Money and Moving
Simple Steps to Keep From Breaking the Bank
By Daniel Beauregard
Moving to a new city can be an expensive and stressful proposition.There are many financial factors to consider: Should you rent rather than buy a new home? What’s the cost of living in your new city? What should you budget for? A little preparation can go a long way toward preventing unwanted or unexpected expenses and taking much of the anxiety out of the experience.
The first and most important step is to have a plan in place so that you know what to expect. “Any proper plan begins with a list of expenses relating to the move itself, getting set up, and ongoing changes with annual expenses such as property or tax rates—city and state—as well as differences in living expenses,” says Debbie Montgomery, an Atlanta-based certified financial planner.
Making the Move
It’s important to be aware of small expenses that can add up quickly, such as packing materials. Be sure to budget for such items as boxes and tape. Figure out what you’ll need beforehand and buy as much of it as possible before you get started.
If you’re moving your belongings yourself, there are additional costs to account for, including van or trailer rental. If your trip will take several days, determine whether you’d feel comfortable booking hotels in advance, and be aware that discount travel sites like Priceline and Hotwire don’t disclose where you’ll be staying until after you’ve paid for the room. Moving with pets presents its own issues, such as making frequent stops to let your animal stretch its legs, and finding pet-friendly lodgings.
A cross-country move presents other issues, as well. “If you can afford to hire a mover and ship all of your belongings, then that is the easiest way,” says David Weinberg, an attorney who has worked as both a residential and commercial real estate agent. “You just have to consider that it will take the mover several days to get to your new residence.”
Do some comparison-shopping of different moving companies to get the best price for the best service. If you’re moving for your job, check with your employer to see if they will cover the cost of the move.
And whether you’re leaving behind an apartment or selling a house in your old city, “don’t forget to cancel your utilities and return your cable boxes,” Weinberg says.
Finding Your New Home
Perhaps the most significant financial issue is deciding where you’re going to live. Often, there’s not enough time to scout various neighborhoods and make an informed decision before you move to your new city. Daren Blomquist, vice president of real estate website Realtytrac.com, recommends renting for up to six months while you investigate different parts of the city. This can be a difficult adjustment if you’re used to owning a home, but Blomquist stresses that there are many single-family homes available for rent in today’s market. “Choosing to rent doesn’t mean you’ll be stuck in an apartment,” he says.
When considering the rent-versus-buy debate, it’s crucial to weigh such factors as the expenses involved in homeownership and how long you plan to live in your new city.
“Typically, if you’re not planning on staying in that city for more than five years, you should rent,” Blomquist says. “The equity that you would build in a home in less than five years isn’t going to offset the costs of keeping it up.”
If you do decide to buy, engage the services of a knowledgeable Realtor to help you navigate the process and advise you on the different mortgage rates available, as well as mortgage interest-rate deductions and other incentives for which you may be eligible. Additionally, a Realtor can give you a clear picture of the financial landscape involved in buying a home, including sales and property taxes and closing costs, which are generally 3 to 5 percent of the purchase price.
Whether you’re renting or buying, however, you should definitely consider purchasing insurance to cover any unexpected losses or damages. Pay particular attention to the rate, as well as how much coverage a particular plan offers.
“Find an [insurance] agent who has been in the business 10 years,” Weinberg says, “and who is willing to spend 30 minutes to an hour explaining coverage limits with you, what special needs you may have.”
Cost of Living in Atlanta
Once you’ve factored in the cost of your new home (and getting yourself there), it’s time to take into account the costs associated with living in Atlanta.
The good news is that this isn’t an expensive place to live. The American Chamber of Commerce Research Association’s Cost of Living Index for 2012 places Atlanta’s cost of living at approximately 96 percent of the national average, meaning life in Atlanta is a little cheaper.
Sites such as Relocation Essentials, CNNMoney.com and Coli.org offer cost-of-living calculators that can give you a sense of what you’ll need to make in Atlanta to approximate the salary you earned in your previous city.
It’s also a good idea to take into account any auto or property taxes or expenses that might be different from your previous city. Most counties in metro Atlanta, for example, require yearly emissions inspections for cars and light trucks dating from 1989 to 2010.
And as Debbie Montgomery points out, don’t forget to budget for filling your new home with such items as tools, curtains, furniture and appliances.
Most importantly, be sure to leave room in your budget for exploring everything your new home has to offer.
“Consider how far the dollar will take you,” advises Weinberg. “If you can’t afford to enjoy your new city, then why move there?”