Move Based on Taxes?

[trfie]

I live in a very expensive city now and am considering moving to a tax-free state with a lower cost of living so that I could live in a nicer place with lower cost as well as save a higher % of my income. I am late 20s and single and would like to not live in a completely rural area. Am considering Nevada and South Dakota. I don't know anyone who is considering anything like this, firstly because there is no understanding/knowledge of ERE, also everyone I know does not choose their place of living based on finances but it seems to me to be a perfectly reasonable way to choose a place. I may be working in multiple states but still need to choose a primary place of residence.

I saw a list of cities conducive to ERE but as far as I can tell there is no forum or place to discuss this specific topic (nor could the page I saw support comments on locations).

Has anyone done this and how did the decision work out? Suggestions on possible cities/areas? I don't really know what I'm looking for but maybe a city somewhere nearby (although I think I may be content without this too, have been working a lot recently), safety, cost of living, propinquity to an airport, friendliness of ppl.

[SimpleLife]

Perhaps start with a google search of the parameters above, then do more research on the city data website and forums to narrow it down. Climate and culture are important too.

[Tyler9000]

Seems perfectly reasonable to me. Taxes were certainly on my radar when I last moved.

One thing I'd recommend is to look at the overall tax load for your particular situation and income rather than focus solely on state income tax. Many of those states make up for it with high property taxes, and depending on your lifestyle they may not be the absolute best tax deal.

Several people I knew in the Bay Area ended up moving to the Texas/New Mexico/Colorado corridor and money was a big reason. You might add those to your evaluation list. I moved to central Texas, but family and industry were also considerations for me.

[DividendGuy]

I moved from Michigan to Florida back in 2009 in part to avoid state income taxes. One of the best decisions I ever made. MI taxes north of 4%, so at $50k that's more than $150 per month. Factor in a lower cost of living and more income down here and it seriously helped me get on the right track. In addition, it was a lot easier to live car-free down here to a more favorable year-round climate.

[Dragline]

It's something to consider amongst other local taxes and general living expenses, which are mostly housing.

[FRx]

that's why I did just for 2015. I moved from San Diego to Portland Oregon. I thought about no-tax/low-tax states but the issue is that it's easy to fall into a lifestyle inflation. I wanted to be somewhere where it's easier for me to be frugal, not own a car and have access to cheap food/drinks/social hour. So far it's working out really well.

[DividendGuy]

FRx,

What do you think of Portland? That might be one of the most "Europeanesque" cities in the US, from what I can tell. The rainy weather, high state income tax, and relatively high (relative to Sarasota, FL) COL keeps me on the sidelines from considering a move there. But it does seem like an awesome and clean city. The public transportation is also the bomb.

[FRx]

yea it reminds of Europe quite a bit. everyone is for. very few people drive new cars. after 11p when I ride home there are still plenty of people on their bikes. there isn't really rain here the way we know it in FL and Cali. it's a drizzle. very friendly group of people. crime appears to be low. summer time has a lotta homeless people but they have just as much right to be on the streets as me so they don't bother me at all. Good and drinks and socializing os very cheap. happy hour is dirt cheap. clbig gyms and yoga can be had for $8-10 a session. libraries are nice but small. lot of culture and activities. rent is expensive in the city and home prices super high. but further out it's quite a bit cheaper, not as cheap as maybe Jacksonville FL but much cheaper than the worst neighborhoods in southern Cali.
I can be frugal here and it's not even considered frugal. I can not own a car and it's really not that impressive. Like you said, public transport is cheap and very accessible.

[IlliniDave]

For a time right out of college I lived in the Boston area, then had a long-term temporary assignment in Tennessee. Ultimately I was presented with an opportunity to make the assignment "permanent" and relative costs of living absolutely weighed into my decision to accept the opportunity. I was single an in my middle 20s at the time. There were other considerations besides financial though. I was not a native of the Boston area so I was not leaving family/friends at the time. From an employment perspective I was staying with my employer and had actually been performing my "new job" for over a year so there were no unknowns there, nor reductions in pay that often accompany a relocation from a high to a low cost of living area. The area I was moving to wasn't strictly rural, but significantly more rural than the Boston area. This was more than 25 years ago, so it was not a decision based on ERE per se.

Many of my colleagues who were on similar temporary assignment ultimately returned to Boston, based on numerous considerations: family, cultural, perceived long-term economic opportunity, etc. Others stayed a few years and left. Some, like me, are still here. For me the decision to stay in the southeast was a very good one. I adapted easily to the culture, at least in the sense I could peacefully coexist with it, and especially over the last 7 years have exploited the relative cost of living rather well. I do pay state income tax in AL where I currently work, but costs of housing and property taxes seem to outweigh that.

Growing up a long stone's throw from Chicago, I would have never in a million years have seen myself spending most of my adult life in the south. So what I would say by way of advice relative to my experience is to remember that there is more to such a decision than cost of living, and that one should keep an open mind. What might seem unacceptable a priori could prove much better than it appears.

[OldPro]

The answer to 'move based on taxes' is no. It has to be no since it is only one factor in any decision to move. If the question was, 'should you consider taxes when looking at moving' then the answer would be yes, it's worth considering in a list of factors.

[SimpleLife]

I live in a very expensive city now and am considering moving to a tax-free state with a lower cost of living so that I could live in a nicer place with lower cost as well as save a higher % of my income. I am late 20s and single and would like to not live in a completely rural area. Am considering Nevada and South Dakota. I don't know anyone who is considering anything like this, firstly because there is no understanding/knowledge of ERE, also everyone I know does not choose their place of living based on finances but it seems to me to be a perfectly reasonable way to choose a place. I may be working in multiple states but still need to choose a primary place of residence.

I saw a list of cities conducive to ERE but as far as I can tell there is no forum or place to discuss this specific topic (nor could the page I saw support comments on locations).

Has anyone done this and how did the decision work out? Suggestions on possible cities/areas? I don't really know what I'm looking for but maybe a city somewhere nearby (although I think I may be content without this too, have been working a lot recently), safety, cost of living, propinquity to an airport, friendliness of ppl.

OP, did you relocate? I think it's a good idea to relocate if you can lower your cost of living, especially while maintaining your standard of living. Combine that with tropical weather, no state income tax, etc. and I think it makes sense to relocate.

I myself am seriously considering relocating. Not right now, but once I'm done working. I think it makes sense to live in a place where the cost of living is high during the accumulation phase only because that's where the high paying jobs are. That's not to say you have to live an expensive lifestyle, you can live cheaply even in expensive areas if willing to live in less desirable areas or commute. In any case, once you have your money, there is no reason to stay in the same high cost of living area if you are retired and thus no longer working.

[Jenie]

What do you guys think of an IL to CA move? I am wondering since both states are broke, at least CA would have a better weather, but the housing is quite more expensive. TIA