I am moving to a new city. How do I plan and prepare - financially - for the move?
Some of the costs you might incur include: Utilities and cost of living vary from city to city but maybe not that much.  For basic planning purposes you can probably figure to spend as much as you are now, maybe a little more.  And adjust as needed when you get there.  (And adjust if, for example, you're moving from a very low cost of living area or to a very high cost of living area.) The cost of housing varies quite a bit from city to city, but you can do this research using Zillow, Craigslist, other places. Now, on to moving itself.  The cost of moving can vary hugely depending on how much stuff you have and how much work you want to do.  On the cheap end, you can rent a U-Haul or one of those portable boxes that they plant outside your old house and move for you.  You'll do all the packing/loading/unloading/unpacking yourself but it saves quite a bit of money.  My family and I moved from Seattle to California last year using one of those portable box places and it ended up costing us ~$1400 including 30 days of storage at the destination while we looked for a place.  We have a <1000 sq foot place with some furniture but not a huge amount and did all the packing/loading ourselves.  If we had wanted full service where people come pack, load, unpack, etc, it could have been 2-3x that amount.  (And if we had more stuff, it could have been a lot more expensive too.  Try not to acquire too much stuff as you just end up having to move it around and take care of it all!)  Your employer may cover moving expenses, ask about this when talking about job offers.  Un-reimbursed moving expenses are tax-deductible in the US (even if you don't itemize).   Since you're just starting out, your best bet is to overestimate how much you think things will cost, then adjust as you arrive and settle in for a few months.  Try to save as much as you can, but remember to have fun too.  Hope this helps!
"Figure out how much money you earn, what you spend it on, and how that will change when you have kids (will one of you stay at home? if not, how much will daycare cost and how do you finance the first few month when your child is still too young for daycare?) You will usually plan to spend your current Kaltmiete (rent without utilities) on your mortgage (the Darlehen that is secured by your house) - keep in mind though that a house usually has a higher utility cost than an appartment. When you've figured out what you can save/pay towards a house now and how that will change when you have kids, you can go on to the next step. If you don't want to buy now but want to commit to saving up for a house and also want to secure today's really low interest rates, consider getting a ""Bausparvertrag"".  I didn't find a good translation for Bausparvertrag, so here is a short example of how it works: You take a building saving sum (Bausparsumme) of 150000€ with a savings goal (Sparziel) of 50000€ (the savings goal is usually between 20% and 50% of the sum) and then you make monthly payments into the Bausparvertrag until you reach the savings goal at which point you can take out your savings and a loan of 100000 € (or whatever your difference between the Bausparsumme and Sparziel is). If you're living in an expenisve area, you're likely to need more than 150000 but this is just an example. Upsides: Downsides: If you decide to buy sooner, you can also use your Bausparvertrag to refinance later. If you have a decent income and a permanent job, then ask your bank if they would consider financing your house now. To get a sense of what you'll be able to afford, google ""wie viel Haus kann ich mir leisten"" and use a few of the many online calculators. Remember that these websites want to sell you on the idea of buying a house instead of paying rent, so they'll usually overestimate the raise in rents - repeat the calculation with rent raise set to 0% to get a feeling for how much you'll be able to afford in today's money. Also, don't forget that you're planning to get children, so do the calculation with only one income, not two, and add the cost of raising the kids to your calculation. Once you've decided on a property, shop around a bit at different banks to get the best financing. If you decide to buy now (or soon), start looking at houses now - go to model homes (Musterhäuser) to find out what style of house you like - this is useful whether you want to buy an existing house or build a new one. If buying an existing house is an option for you, start visiting houses that are on sale in your area in order to practice what to ask and what to look for. You should have a couple of visits under your belt before you really start looking for the one you want to buy. Once you're getting closer to buying or making a contract with a construction company, consider getting an expert ""Bausachverständiger"". When buying an existing house they can help you estimate the price and also estimate the renovation cost you'll have to factor in for a certain house (new heating, better insulation, ...). When building a new house they can advise you on the contract with the construction company and also examine the construction company's work at each major step (Zwischenabnahme). Source: Own experience." "Look for states that have no income tax. A lot of these states supplement their revenue with higher property taxes, but if you rent and do not own property in the state, then you will have no state tax liability. Similarly, many states treat capital gains no differently than income tax, so if you make your earnings due to a large nest egg, then way you will still incur no tax liability on the state level Look for ""unincorporated"" areas, as these are administrative divisions of states that do not have a municipal government, and as such do not collect local taxes. Look for economic development perks of the new jurisdiction. Many states have some kind of formal tax credit for people that start business or buy in certain areas, but MONEY TALKS and you can make an individual arrangement with any agency, municipality etc. If the secretary at city hall doesn't know about a prepackaged formal arrangement that is offered to citizens, then ask for the ""expedited development package"" which generally has a ""processing fee"" involved. This is something you make up ie. ""What is the processing fee for the expedited development package, quote on quote"" States like Maryland and Nevada have formalized this process, but you are generally paying off the Secretary of State for favorable treatment. You'll always be paying off someone." Just set up a budget. Indicate how much money comes in, how much goes out to must pay expenses (lodging, food, gas, heat, cooling, etc), and determine how much is leftover for anything else you want. If that amount is ok, then you're fine. If not, something needs adjusting. "The suggestions towards retirement and emergency savings outlined by the other posters are absolute must-dos.  The donations towards charitable causes are also extremely valuable considerations. If you are concerned about your savings, consider making some goals.  If you plan on staying in an area long term (at least five years), consider beginning to save for a down payment to own a home.  A rent-versus-buy calculator can help you figure out how long you'd need to stay in an area to make owning a home cost effective, but five years is usually a minimum to cover closing costs and such compared to rending. Other goals that might be worthwhile are a fully funded new car fund for when you need new wheels, the ability to take a longer or nicer vacation, a future wedding if you'd like to get married some day, and so on.  Think of your savings not as a slush fund of money sitting around doing nothing, but as the seed of something worthwhile. Yes, you will only be young once.  However being young does not mean you have to be Carrie from Sex in the City buying extremely expensive designer shoes or live like a rapper on Cribs.  Dave Ramsey is attributed as saying something like, ""Live like no one else so that you can live like no one else.""  Many people in their 30s and 40s are struggling under mortgages, perhaps long-left-over student loan debt, credit card debt, auto loans, and not enough retirement savings because they had ""fun"" while they were young.  Do you have any remaining debt?  Pay it off early instead of saving so much. Perhaps you'll find that you prefer to hit that age with a fully paid off home and car, savings for your future goals (kids' college tuitions, early retirement, etc.).  Maybe you want to be able to afford some land or a place in a very high cost of living city. In other words - now is the time to set your dreams and allocate your spare cash towards them.  Life's only going to get more expensive if you choose to have a family, so save what you can as early as possible." This is the exact reason I don't live in an expensive city.  I turned down a job offer in DC paying 60k right out of school because I could get a similar salary in the midwest and pay about half as much in living expenses.    --Sent from a 2 bedroom apartment in an urban area with included laundry facilities for $750/month. "To begin, I'm not sure you understand what COL refers to.  It's what you spend, not what you bring in.  Let's say Bob makes 60k in some midwest town, but spends 30k for living.  If his salary and his cost of living both increase at the same rate, let's say they both double, this means Bob now makes 120k but spends 60k.  He now saves double what he would have before.  That 30k extra saved is 30k extra saved.  His purchasing power has now gone greatly up, especially in respect to housing outside of an expensive area like the valley.  For one, let me clear this up - SF, the city itself, is expensive.  I'm talking more generally about the bay area, and silicon valley as a whole.  Most tech jobs from the big tech companies that we think of as ""the bay"" are not in SF.  they are in mountain view, Sunnyvale, and that area.  So this might explain some of our disagreements.  Most people who work for large tech companies understand they have a decision to make - live in the city proper, pay a lot more than the greater valley, use transit into work (all of the giants have regular shuttles in), but get to love a more ""hip"" life, or be more conservative in the valley, where rental prices are on par with NYC.  In talking to a lot of people who work for the big companies, they know this.  Younger folks who want to live the city life pay the premium, but by far and wide they live outside of it, where it is closer to work, and they take the rail up for weekends out with buddies.  I'm still not sure where you are getting a doubling of the COL in the valley versus outside.  Yes, housing as a single item is going to be a person's largest expense.  But all the rest of their expenses are not going to see a similar increase.  It's also important to remember that saving 10% of 60 v 10% of 120 is significantly different.  Lots of people take jobs in the valley, are able to save vastly larger amounts of cash, and then leave.    In my calculations I evaluated the COL markup to be ~30% for the valley for a 200k job.  That is, I spend maybe 50k of my earning on all living expenses in the Midwest (in a downtown, nice area), and would expect I'd pay about 70k for the same standard in the valley.  But I'd be saving a shitton more.  I've done the math, I'm not here to argue with someone who just googled SF cost of living searching for the answers I want.  I've talked to actual people out there.  I appreciate your passion for this, but your 100% increase in COL estimate is simply wrong.  But then again, it depends on how you live and where you live in your current situation.  I live in a large midwest city, actually in the city itself." You question is a bit scary to me. You show $2100 rent, and let's even assume that's 100%, i.e. never a vacancy. (Rule of thumb is 10% vacancy. Depending on area, a tenant may stay a year, but when they leave, you might need to have a bit of maintenance and miss 2 months rent) You count the mortgage and taxes, and are left with $500/mo. Where is the list of ongoing expenses? I suggest you put that $500/mo into a separate account and let us know a year from now if anything is left. To Anthony's point. I agree 100%, no one can tell you everything you need to know. But, whatever my answer, or his, other members with experience (similar or different) will add to this, and in the end you'll have a great overview. The truth is that it's easy for me to sit here and see what you may be missing. By the way, if you look at the 'rules of thumb' they will make your head spin. There are those who say the target is for the rent to be 2% of the value of the house. But, there are markets where this will never happen. There's another rule that says the expenses (besides mort/tax) should be planned at 50% of the rent, i.e. you should put aside $1000/mo for expenses over the long term. The new house will be lower of course, but in years past year 10 or so, this number will start to look reasonable. I think the biggest thing you need in this situation is a budget/spending plan that you both agree on.  Look at what your income is going to be and what expenses you'll have, and make cuts where needed.  If it's important to you that she be able to spend some money on herself, then make sure there's a budget for it.  Often, knowing that there's a plan that will work will help put someone's mind at ease. Also, make sure you're communicating, especially in the subtle non-verbal ways, that you're in this together, and that you don't think it is unfair that you're bringing in most of the income during this time.  In general, make sure you're talking with each other a lot and being honest about your feelings about this major life change. "How will 45K-60K ""end up in your pocket""?  Are you selling your home?  Where are you going to live?  You talk about moving to Arizona, what is so magical about that place? Congratulations on making a wise purchase.  Some people with new found money use it to correct past mistakes.  However, if they do not change their behavior they end up in the same situation just less them money they once had. While 50K income is respectable at your age, it is below the national average for households.  One factor in having a college education is those with them tend to experience shorter and fewer periods of unemployment especially for males.  Nothing will ever replace hustle, however.  I'd ask you to have a plan to raise your income.  Can you double it in 5 years?   You need to get rid of the revolving debt.  Do that out of current income.  No need to touch the house proceeds for something so small.  Shoot for 9 months. Then you need to get rid of the speeding fines and the vehicle loan.  That is a lot of vehicle for your income.  Again, I would do that out of current income or by selling the vehicle and moving to something more inline with your income.   As far as to moving or flipping foreclosures that is more of a question that has to do with your hopes and dreams.  Do you want to move your children every 3 years?  What if you move to Arizona and it turns out to be quite horrible?  You and your wife need to sit down and discuss what is best for your family." "Okay. Savings-in-a-nutshell. So, take at least year's worth of rent - $30k or so, maybe more for additional expenses. That's your core emergency fund for when you lose your job or total a few cars or something. Keep it in a good savings account, maybe a CD ladder - but the point is it's liquid, and you can get it when you need it in case of emergency. Replenish it immediately after using it. You may lose a little cash to inflation, but you need liquidity to protect you from risk. It is worth it. The rest is long-term savings, probably for retirement, or possibly for a down payment on a home. A blended set of stocks and bonds is appropriate, with stocks storing most of it. If saving for retirement, you may want to put the stocks in a tax-deferred account (if only for the reduced paperwork! egads, stocks generate so much!). Having some money (especially bonds) in something like a Roth IRA or a non-tax-advantaged account is also useful as a backup emergency fund, because you can withdraw it without penalties. Take the money out of stocks gradually when you are approaching the time when you use the money. If it's closer than five years, don't use stocks; your money should be mostly-bonds when you're about to use it. (And not 30-year bonds or anything like that either. Those are sensitive to interest rates in the short term. You should have bonds that mature approximately the same time you're going to use them. Keep an eye on that if you're using bond funds, which continually roll over.) That's basically how any savings goal should work. Retirement is a little special because it's sort of like 20 years' worth of savings goals (so you don't want all your savings in bonds at the beginning), and because you can get fancy tax-deferred accounts, but otherwise it's about the same thing. College savings? Likewise. There are tools available to help you with this. An asset allocation calculator can be found from a variety of sources, including most investment firms. You can use a target-date fund for something this if you'd like automation. There are also a couple things like, say, ""Vanguard LifeStrategy funds"" (from Vanguard) which target other savings goals. You may be able to understand the way these sorts of instruments function more easily than you could other investments. You could do a decent job for yourself by just opening up an account at Vanguard, using their online tool, and pouring your money into the stuff they recommend." "According to your numbers, you just stated that you spend approximately $1500 in discretionary expenditures per month, yet are unable to save. I fully realize that living in a big city is usually expensive, but on your (presumably after-tax) salary, I think you can easily save a substantial portion of your income. As others have already noted, enforcing saving of a significant portion of your discretionary income is the most obvious step.  It's easy to say, but I suspect that if you are like most people who have difficulty saving, the psychological impact of quitting your previous spending habits ""cold turkey"" is likely to be very harsh, all the more so if you have an active social life.  You may find yourself becoming depressed or resentful at ""having"" to save.  You may lose motivation to work as hard because you might think that you're putting away all this money for the distant future, whereas you are young now and want to enjoy life while you can. It is in this context, then, that I looked at your other financial obligations.  Paying $1300/month to your parents is a lot.  It's over 20% of your after-tax salary.  You do not specify the reasons for doing this other than a vague sense of familial duty, but my recommendation is to see if this could be reduced somewhat.  If you can bring it down to $1000/month, that $300 would go into your savings, and you would psychologically feel a lot better about putting, say, $600 of your own discretionary income into savings as well.  Now you have, all told, about $1000/month of savings without severely curtailing your extra expenditures. But I would start with that $1500/month of luxury spending first.  And yes, you do need to view it as luxury spending.  The proper frame of mind is to compare your financial situation to someone who is truly unable to save because their entire income is spent on actual necessities:  food and shelter; their effective tax rate is 0% because they earn too little; and they usually find themselves in debt because they cannot make ends meet.  Now look back at that $1500/month.  Can you honestly say that you cannot afford to cut that spending?" Thanks for the reply!  Sadly, I have considered NYC, Chicago and even London, but my heart is set on Toronto. Also, I'm not quite sure I know what you mean by siphoning funds. I wasn't aware that financial engineers in Toronto do things differently than financial engineers in the US. You don't say why you want to move. Without knowing that, it is hard to recommend a course of action. Anyway... The sequence of events for an ECONOMICAL outcome in a strong market is as follows: (1) You begin looking for a new house (2) You rent storage and put large items into storage (3) You rent an apartment and move into the apartment (4) The house now being empty you can easily do any major cleaning and renovations needed to sell it (5) You sell the house (and keep looking for a new house while you do so). Since the house is empty it will sell a lot more easily than if you are in it. (6) You invest the money you get from selling the house (7) You liquidate your investment and buy the new house that you find. If you are lucky, the market will have declined in the meantime and you will get a good deal on the new house in addition to the money you made on your investment. (8) You move your stuff out of storage into the new house. There are other possibilities that involve losing a lot of money. The sequence of events above will make money for you, possibly a LOT of money. "If you want to be really ""financially smart,"" buy a used good condition Corolla with cash (if you want to talk about a car that holds re-sale value), quit renting and buy a detached house close to the city a for about $4,000/month (to build equity. It's NYC the house will appreciate in value). Last but not the least, DO NOT get married. Retire at 50, sell the house (now paid after 25-years). Or LEASE a nice brand new car every year and have a good time! You're 25 and single!" I would advise against this. My main reason for saying so is that you are in a time of major transition, and transition equals uncertainty. What if the new job turns out to be a bad one, and at the same time the house is more difficult to rent out than you expect? That seems like a situation that would be worse than the sum of its parts. Some other things to consider: first, if you want to buy a house where your new job is located, you will not be able to borrow as much for that house.  This is especially important if you are moving to a city with a very high Cost of Living. Second, your margin on the rental doesn't sound like it would leave much room for profit. A $100 difference between your mortgage and your rent amount will be eaten up very quickly through property management fees and maintenance.  If the value of the house does not rise like you expect, that could mean you put in a lot of effort for very little or no gain. Finally, this will require a good deal of time management. Between relocating, closing on this house, and beginning a new job, it sounds like you'll have a lot going on. This may not concern you much, but it's still worth considering.