Your Money and Your Location

There are many decisions to be made in your life regarding money.  The big questions tend to revolve around things like making money, saving money, investing, etc.  One thing that does not get discussed as often is where to live.  I don't just mean a decision of whether to buy or rent, but a decision of what city to live in or even what country to live in.

Everybody's situation is different.  Some people really have little choice in where they can live.  Many people are tied down by family, real estate, businesses, or jobs.  There are others who have far more flexibility.

If you have flexibility, particularly if you are young, you should really take this decision seriously on where to live.  I am not a big fan of moving to another country unless you live in a third world country that doesn't have much opportunity.  If you are young and flexible, it is not a bad idea to see the world, but I would advise against moving somewhere until you have seen it and spent some time there.  It may sound like a great idea to move to some exotic location for someone living in the U.S., but you may be surprised at the culture shock.

Within the U.S., I would recommend staying away from the really big cities.  New York City, Chicago, and Los Angeles are all expensive with high taxes.  Of course, there are always exceptions.  If you are a big-time banker on Wall Street or a movie star in L.A., then you will probably want to stay where you are. But for most people, it really isn't worth it.

It is hard to stay away from bigger cities because that is where the most opportunity tends to be.  Your profession will play a big role in your location.  For someone who works at home, you should really take advantage of your flexibility.  If you want to be near a big city, live in the suburbs.  Keep a distance from downtown.  It will be safer, cheaper, less crazy, and more family oriented.

Try to stay away from states that are in big trouble, fiscally speaking.  California, Illinois, New York, and New Jersey are just a few of the states that come to mind.  They are deep in debt and they already have really high taxes.

There are currently 9 states without an individual income tax.  They are Alaska, Florida, Nevada, New Hampshire, South Dakota, Tennessee, Texas, Washington, and Wyoming.  You can view the list here:

You should consider each one with your own situation.  For instance, if you are retired and have income from stocks and bonds, then Tennessee may not be that good since they do have a tax on that.  New Hampshire, home of the Free State Project, does not have an income tax or sales tax.  There is a tax on interest and dividends.

Of course, climate and lifestyle will also play a huge role.  But when researching a place to live (if you have the flexibility), you should research the taxes, regulations, and cost of living.  Again, I understand that it is easier for some than others, but you really should take time to see some of the great places to live if you have the option.