Having to relocate for a job can be exciting or stressful, but it’s always involves transformation. Regardless of the situation, you have to uproot your family and let go of almost everything you know for a totally new experience.
From a financial standpoint, it’s essential to make smart choices about your money.
Tips to Make the Process Smoother
When you’re relocating to a new city, you have a lot to think about. But with regard to finances, the following five tips should help to keep you on track so you avoid making any costly mistakes.
- Research the Cost of Living
The first thing to do is research the differences in the cost of living between where you currently live and in the city you’re moving to. A handy calculator like this one can give you a general idea of how much you may need to make in order for the move to pencil out for your household.
- Figure Out Where You Want to Live
Although your employer will dictate the city you’re moving to, you usually get to decide exactly where you want to settle in terms of the area of town. In some cases, real estate values can change dramatically from one street to the next.
If you know exactly where you want to live (or where you don’t!), that will help you calculate how much you’re apt to need to spend. Internet research is great, but it’s nice to be able to talk to a real person as well.
“The key is to talk with multiple types of people. You want to get as many different perspectives as possible,” Green Residential advises. “Ideally, these views will be objective, but they’re always tainted by personal preferences and experiences. Thus, the more opinions you get, the less likely it is that one positive/negative review will throw you off.”
- Find Ways to Save on the Move
A move itself can cost thousands of dollars, but there are plenty of ways to save money if you take the trouble to research costs and make sharp choices. For starters, you should inquire with your employer about what the firm might be willing to cover.
“Some companies cover relocation costs, but it is important to know exactly what that entails. Your employer may reimburse items such as shipping services, packing services, transportation and travel expenses associated with searching for your new home—if you are moving specifically for the job,” Smart About Money explains.
“Negotiate during the hiring process and ask whether your employer will cover other costs such as lease cancellation fees, realtor assistance, temporary housing and storage.”
- Keep Receipts Organized for Tax Season
Even if your employer covers some of your costs, the odds are you’ll end up footing some part of the bill. Make sure you track those expenses and save the receipts. When it comes time to file your returns next tax season, relocation costs may qualify as deductible expenses.
- Find a New Financial Team
As soon as you get settled into your new city, you should begin looking for a new financial team to surround yourself with. This will include a reputable financial advisor, accountant and tax preparer, and insurance provider.
Unless you’re absolutely in love with your previous team, it’s best to align yourself with local experts. They’re going to be more accessible than people who live three or four states away.
It’s Your Money – Make Smart Choices
In some cases, a job relocation will be good for your finances. Other times, it might not make much sense from a dollars-and-cents perspective, but you’ll still have to do it.
In either case, you still have the option to make smart choices with your money so you enjoy a comfortable present and future.