Quote:
Originally Posted by Ecky
Maybe retire to somewhere cheap, but they typically aren't the places to live while you're earning.
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Yes, and no. Retiring someplace cheaper is simple. Wages don't matter because you aren't working and selling a $500K house to buy a $150K house frees up cash for a lot more productive investments.
Working someplace cheaper and saving is more complicated.
Where my parents live in Michigan you would want to be in a healthcare field to make better than average wage in a low cost area.
My wife and I are engineers and moving from Tennessee to Alabama came with salary increases to cover increased housing costs but not to compensate from going from 10 minute commutes to 45 minutes and 1 hr 20 minutes (one way). If we wanted to keep 10 -20 minutes commutes our housing costs would have doubled to tripled.
Moving from Birmingham, AL to Portland, OR didn't come with raises to cover the increased living and housing costs. Housing more than doubled but our salaries increased 15%.
Another big key to banking money money is taxes. Both TN and AL have regressive tax policies centering on a sales tax so they tax low earners higher than high earners. Not good if you are working class but it makes it easier to save for high earners. Oregon has a pretty progressive tax policy mostly based on income taxes so the move from Alabama to Oregon means the tax man takes a bigger bite. (Of course those higher taxes also come with a lot of benefits too) Personally I don't mind paying more taxes because I fundamentally believe that taxing the poor at higher rates than the wealthy is wrong.