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Razors Edge

Once You Own Your House

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...what advantage is there to living in a "low cost of living" location?  Assuming, of course, it's within the same state, so general tax rules remain in place - eg. no property tax, or no sales tax, or no income tax. 

I was chatting with my sister the other night, who lives in another state, and she was complaining about some new tax she might get hit with.  Anyway, in that discussion, we really couldn't come with many expenses these days that are regionally significantly different.  In other words, buying a car in XYZ is pretty close to the same as in ABC. Buying healthcare is pretty much the same across a state.  Groceries, with the exception of local produce, is pretty much the same.  Cable, cell, power, and other monthly bills are usually pretty similar in that they are more related to individual use, rather than regional costs.  And forget EVERYTHING bought online which is identical in price no matter where you live.

Any thoughts?  Clearly, living on Manhattan will be more expensive in many respects than living in a small upstate NY town, but NYC and a couple other places like San Fran might be outliers.

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17 minutes ago, Razors Edge said:

...what advantage is there to living in a "low cost of living" location?  Assuming, of course, it's within the same state, so general tax rules remain in place - eg. no property tax, or no sales tax, or no income tax. 

I was chatting with my sister the other night, who lives in another state, and she was complaining about some new tax she might get hit with.  Anyway, in that discussion, we really couldn't come with many expenses these days that are regionally significantly different.  In other words, buying a car in XYZ is pretty close to the same as in ABC. Buying healthcare is pretty much the same across a state.  Groceries, with the exception of local produce, is pretty much the same.  Cable, cell, power, and other monthly bills are usually pretty similar in that they are more related to individual use, rather than regional costs.  And forget EVERYTHING bought online which is identical in price no matter where you live.

Any thoughts?  Clearly, living on Manhattan will be more expensive in many respects than living in a small upstate NY town, but NYC and a couple other places like San Fran might be outliers.

I think the advantage would be if you owned in a high rent area like you and I and then sold and bought in a low cost area. Apples to apples I don't know if there is a big difference as wages are generally adjusted to the cost of living in certain regions.

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42 minutes ago, Razors Edge said:

...what advantage is there to living in a "low cost of living" location?  Assuming, of course, it's within the same state, so general tax rules remain in place - eg. no property tax, or no sales tax, or no income tax. 

I was chatting with my sister the other night, who lives in another state, and she was complaining about some new tax she might get hit with.  Anyway, in that discussion, we really couldn't come with many expenses these days that are regionally significantly different.  In other words, buying a car in XYZ is pretty close to the same as in ABC. Buying healthcare is pretty much the same across a state.  Groceries, with the exception of local produce, is pretty much the same.  Cable, cell, power, and other monthly bills are usually pretty similar in that they are more related to individual use, rather than regional costs.  And forget EVERYTHING bought online which is identical in price no matter where you live.

Any thoughts?  Clearly, living on Manhattan will be more expensive in many respects than living in a small upstate NY town, but NYC and a couple other places like San Fran might be outliers.

Alberta does not have provincial sales tax.  Ontario does have it and B.C.

But then, a lot of Americans think Canada has higher taxes. (And they forget about our public health care system how it is supported.) I personally have never sat down to compare the 2 countries.  How can one not have property tax?  I don't get it.  In Canada, for property owners, one pays it to the municipality.

Staying in same province..... lots of people have complained that food is more expensive in Toronto. I actually find that strange. Unless one is buying from the farmstand….food pricing is highly competitive in Toronto and there is so much choice and slightly lower prices. Complainers aren't looking hard enough beyond the national chains.  It's actually often more expensive where I live in the prairies except for beef (since beef comes from Alberta). 

I don't see much financial advantage of  lower cost living in rural area...it costs to drive a car to do stuff and the distances will be greater.  Only strange folks like us even dare to bike for errands and that's not even some cycling enthusiasts.  I make this comment after visiting a friend several times over the years where she lived in a rural area...town of 1,000 people about 120 km. west of Toronto. I felt I spent an inordinate amount of time in her car with her, in order for us to do stuff together outside of her home.  Same for another friend living about 100 km. from the U.S. border living in a town of 2,000 people in farm country. I visited her several times and stayed for a few days over the years.   Her food costs were slightly lower but only during summer months.  Again more constant driving (thankfully she enjoyed going out for 1 hr. walks.)

 

 

 

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42 minutes ago, Razors Edge said:

...what advantage is there to living in a "low cost of living" location?  Assuming, of course, it's within the same state, so general tax rules remain in place - eg. no property tax, or no sales tax, or no income tax. 

I was chatting with my sister the other night, who lives in another state, and she was complaining about some new tax she might get hit with.  Anyway, in that discussion, we really couldn't come with many expenses these days that are regionally significantly different.  In other words, buying a car in XYZ is pretty close to the same as in ABC. Buying healthcare is pretty much the same across a state.  Groceries, with the exception of local produce, is pretty much the same.  Cable, cell, power, and other monthly bills are usually pretty similar in that they are more related to individual use, rather than regional costs.  And forget EVERYTHING bought online which is identical in price no matter where you live.

Any thoughts?  Clearly, living on Manhattan will be more expensive in many respects than living in a small upstate NY town, but NYC and a couple other places like San Fran might be outliers.

If you are retired, a low cost of living location can make the difference between living comfortably and struggling to make ends meet.

The BIG advantage to a lower priced area is the cost of buying a home and paying property taxes. I know people who moved from the Baltimore Area (relatively high-priced with the nation's high average household income) to Tennessee and Maine because they could buy a nice low-cost home for half the cost in the Baltimore suburbs, where they couldn't afford one.

In Maryland, most places have property taxes that are 1% or less, but in northern New Jersey they're typically 4.5%. I tell my relatives there they should revolt.  As it is, a lot of people with jobs in NJ buy lower-priced-for-the-same-sized homes on the other side of the Delaware River in Pennsylvania, with low property taxes, and drive two hours each way to and from their jobs. That's how much the cheaper homes and prop. taxes mean to them.

When 12 of us went on vacation to rural Western Maryland - out at the west end of the panhandle - there was a Walmart supercenter. It had a lot of locally produced food.  Chicken was cheaper than in suburban Baltimore and a half-gallon of 2% milk was 75 cents - less than half the price back home.  So there are some places where food is cheaper.

Personally, the best cheap places to buy things in my county were all originally pointed out to me by people making well above 6-figure salaries.  There are people who don't want to be caught dead walking in or out of a Walmart, Aldi, Dollar Tree, Salvation Army Discount Store. etc.  I someone sees me, I'll bet the only thing they'll say is, "See? That's why he has more than a couple pennies to rub together."

But I know people who call discount store stuff and store brands "welfare food" and "welfare clothing" and won't but them even though they're barely making ends meet and can't take the vacations that shopping at such places basically pays for.  When I was teaching in the early 2000's most of us veteran teachers were making $60,000 or more and the people working as janitors, warehouse workers, etc. were making less than $40,000.

On of those warehouse workers asked me, "How do you end up going to China and Egypt and doing a Mediterranean Cruise and all on a teachers salary?  I pointed out to him that I bag lunched almost every day, I brought in my own coffee and 25 cents/can Pepsi from home.  On the other hand, he went out to lunch some days and sent out to McDonald's the other days. Someone went for a coffee run to 7-11 a couple times each day and he bought soft drinks for $1 at the vending machines.

I told him how, if he did what I did, he would save enough money to take his wife and him on those same vacations I took every other year.  He just stared at me blankly - I'm sure he didn't think I was right.  But he was spending about $7/day more than I was for roughly 250 working days and little things do add up. That $1750 and in 2000-5 that would have paid for the flights and a Caribbean Cruise or a Mediterranean Cruise.  My China Trip cost $2150 in 2001.

 

 

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The cost of living, groceries, gasoline, taxes etc is clearly not the same from place to place.  Around here it's not even the same within easy driving distance.  We often travel a couple of towns away to achieve significantly lower prices on groceries.

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I do think you get a bigger cost of living change between states, but even within a state, city taxes can make a big difference.  Price of gas, commuting costs (even taking a train from the NYC suburbs is expensive.  It can be $30 a day roundtrip without including parking at the station, although monthly passes are cheaper than day passes.  An annual pass for parking at the train station can be $1,000. )  These costs wouldn't apply in other parts of the state where people don't commute over an hour because it's too expensive to live in Manhattan.

Costs for restaurants, hotels, entertainment can also vary even within a state.

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I agree taxes are a major factor in cost of living. Sales tax can vary up to 2% within cycling distance from here. Cost of living, in general, can effect the cost of good and services. When cost of living is higher, the cost of labor is higher.

Something else to consider is the ethos of the region. Poorer areas offer more in the way of "off the books" opportunities and barter situations. People are always looking for that extra cash, offering services at a lower rate. You will also share more openly with your "friends in need".  When I was a child, kids clothing was passed around like the common cold.

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Out-state is somewhat cheaper than the metro area..taxes etc...but then you have the access to larger medical facilities and universities etc.

I have briefly thought about my friend who lives in Sioux Falls (to her it is huge and growing..she could never last in the Twin Cities with traffic)...but college town and a well established medical facility...and to me...almost small town like...It would have some advantages....

I also have friends who spend most of their winter in Southern Missouri...in a very rustic cabin...but maintain a place in MN..due to better medical facilities..and well the arts...museums, concerts, etc.

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39 minutes ago, donkpow said:

Something else to consider is the ethos of the region. Poorer areas offer more in the way of "off the books" opportunities and barter situations. People are always looking for that extra cash, offering services at a lower rate. You will also share more openly with your "friends in need".  When I was a child, kids clothing was passed around like the common cold.

My sister is a physician with 2 kids.  She and hubby haven't had to buy 85% of their children's clothing for past few years, because in their circle of parents in Toronto, they all swap and trade clothes all the time:   That alone is saving a lot of money in past few years. Times have changed. There is no shame even in middle class families to exchange used clothes for young children. in the big cities now.

It won't be the same as her daughter hits 11 yrs. old next year.

Quote

Mick:  

On of those warehouse workers asked me, "How do you end up going to China and Egypt and doing a Mediterranean Cruise and all on a teachers salary?  I pointed out to him that I bag lunched almost every day, I brought in my own coffee and 25 cents/can Pepsi from home.  On the other hand, he went out to lunch some days and sent out to McDonald's the other days. Someone went for a coffee run to 7-11 a couple times each day and he bought soft drinks for $1 at the vending machines.

I told him how, if he did what I did, he would save enough money to take his wife and him on those same vacations I took every other year.  He just stared at me blankly - I'm sure he didn't think I was right.  But he was spending about $7/day more than I was for roughly 250 working days and little things do add up. That $1750 and in 2000-5 that would have paid for the flights and a Caribbean Cruise or a Mediterranean Cruise.  My China Trip cost $2150 in 2001.

Some of us are guilty, Mick of frittering our daily coffee money away..no matter how intelligent we are.  

On one hand I"ve had a daily coffee like that (which now I've gotten free for past 8 months because the dept. I work for) but a lot of people think we're  strange not to own car and live/use transit when needed.  I only pay transit once a month or less.  But  fly by plane about 2-3 times annually within Canada. (That's why I wish our country wasn't so enormous.)

It depends what parents want in terms of exposures for their children long term.  My partner grew up in a very small town north of Toronto...there's not much for the kids to do. And he was a self-learner.  And social diverse learning was highly restricted for a bright young boy.   He couldn't have progressed personally until...he moved into the big city.  In all this discussion, we are forgetting about educational opportunities, post high school  --both formal educational programs and on job learning /training. Sometimes people do need to move away from rural areas to get that for a few years.

As for retirement:  I most certainly would like to remain in a city with at least 1 university/college. Often it is this institution that  offers certain courses/generates others who have capacity, sparks public events/very different in-your-face contact of doing things differently/issues.  Internet remote virtual learning,  hasn't solved that learning totally....since we have a lot of misinformation flying around anonymously. 

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My sister in NJ paid +$6k/year in property taxes on on 800 SF, clapboard, 30 YO house, while I was paying less than $800/yr for a 2500SF, all brick, new house in MS. My garage was bigger than her house.

We pay about $3k in property taxes on a 2100 SF home where the median home price is ~$400k (we're below the median)

There are only a handful of toll roads in GA, all of which are the rush-hour expressway variety.

Roads above the Mason-Dixon line are in horrible condition.

Our cars don't look like shit after 5 winters.

A commute of >45 minutes is a long one (barring accidents and rain, but I'ma guessing that's the same everywhere one lives (except maybe sheep_herder))

We're paying $2.35/gallon of gas.

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50 minutes ago, 2Far said:

My sister in NJ paid +$6k/year in property taxes on on 800 SF, clapboard, 30 YO house, while I was paying less than $800/yr for a 2500SF, all brick, new house in MS. My garage was bigger than her house.

We pay about $3k in property taxes on a 2100 SF home where the median home price is ~$400k (we're below the median)

There are only a handful of toll roads in GA, all of which are the rush-hour expressway variety.

Roads above the Mason-Dixon line are in horrible condition.

Our cars don't look like shit after 5 winters.

A commute of >45 minutes is a long one (barring accidents and rain, but I'ma guessing that's the same everywhere one lives (except maybe sheep_herder))

We're paying $2.35/gallon of gas.

Uh, those are two different states.  

So, in your state, there are likely two or more distinct areas where there are different costs of living.  After you factor out housing - why would anyone choose one over the other?

But for the record, if someone's car looks like shit after 5 years in NJ, that's the owner, not the fault of the car, roads, or weather.

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12 hours ago, Razors Edge said:

...what advantage is there to living in a "low cost of living" location?  Assuming, of course, it's within the same state, so general tax rules remain in place - eg. no property tax, or no sales tax, or no income tax. 

I was chatting with my sister the other night, who lives in another state, and she was complaining about some new tax she might get hit with.  Anyway, in that discussion, we really couldn't come with many expenses these days that are regionally significantly different.  In other words, buying a car in XYZ is pretty close to the same as in ABC. Buying healthcare is pretty much the same across a state.  Groceries, with the exception of local produce, is pretty much the same.  Cable, cell, power, and other monthly bills are usually pretty similar in that they are more related to individual use, rather than regional costs.  And forget EVERYTHING bought online which is identical in price no matter where you live.

Any thoughts?  Clearly, living on Manhattan will be more expensive in many respects than living in a small upstate NY town, but NYC and a couple other places like San Fran might be outliers.

I don't know of any areas that are property tax free?  Do you?  Our property taxes are quite high in Oregon.  This is why we will choose to stay in a tiny and modest home.  This prevents high taxes.  

 

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38 minutes ago, Razors Edge said:

So, in your state, there are likely two or more distinct areas where there are different costs of living.  After you factor out housing - why would anyone choose one over the other?

Availability of work.

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5 minutes ago, Dirtyhip said:

I don't know of any areas that are property tax free?  Do you?  Our property taxes are quite high in Oregon.  This is why we will choose to stay in a tiny and modest home.  This prevents high taxes.  

Good question, and like all fun topics, it looks like there are some places where it is "free" or hugely reduced - for certain folks.

But the better way to put it would be, "similar property tax rates" I guess.

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5 minutes ago, Dirtyhip said:

I don't know of any areas that are property tax free?  Do you?  Our property taxes are quite high in Oregon.  This is why we will choose to stay in a tiny and modest home.  This prevents high taxes.  

 

The county just north of us is PT free for homeowners +63.

We won't pay city taxes after age 65.

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