Is Moving Worth it to Achieve Financial Independence?

Does it make sense to move somewhere cheap to achieve financial independence sooner? It's not an option for everybody, but leaving an expensive city for a cheaper one can have a big impact on your retirement aspirations.Does it make sense to move somewhere cheap to achieve financial independence sooner? It’s a topic we talk about sometimes in our household. If we could lower our housing costs by moving, we could retire much sooner than our plan.

We’re in a middle stage of life with three young kids, a minivan, and a mortgage and in the suburbs. Moving somewhere cheaper would be difficult now, but it’s not out of the question.

Younger people who haven’t settled down yet but still aspire to retire early should pay close attention to their living situation and the forthcoming decisions around permanent residences. Cost of living has serious implications on the financial independence equation.

Pick Up Your Life and Move

After traveling to nearly 50 countries and various small and large towns across the globe, only a handful stand out as places I’d want to live permanently.

My hometown is one place I’d consider. I don’t live there anymore, but that’s where my parents are, and most of my childhood friends are still there.

Carmel, CA, Switzerland, and London, are a few other compelling places. But they’re expensive and not practical.

Another place is San Diego. The first few times I visited I thought, what would it take to pick up my life and move here?

When I was a kid, my family visited my Aunt and Uncle there. They took us to Coronado Beach and we had breakfast at the cool hotel. They introduced us to fish tacos from street vendors. I loved it.

Then early in my career, I had a week of software training in Carlsbad. I stayed at a hotel in La Jolla. So nice.

And after backpacking for 14 months and enduring a brutal 48-hour bus ride from Mexico City, I reentered the U.S. from Tijuana into San Diego.

I stayed with an old friend. His roommates would walk down to Pacific Beach at 4pm to play horseshoes and drink beer a few times a week. That’s my kind of happy hour.

If there was ever a time to move to San Diego, it was in 2002 after traveling. But I was passing through and planning to settle down in my hometown.

The climate is perfectly comfortable in San Diego. Beach towns ping the coast headed north of an economically thriving and cultural city. San Diego has it all… except one thing.

Low cost of living.

Fast forward to when I was in San Diego again for FinCon. FinCon is a conference primarily for financial bloggers, media, and companies. This was the second year I attended. It’s a place to meet “online friends”, learn to run a better blog and network with companies who partner with sites like RBD to grow their businesses.

Being my fourth visit to San Diego, I expected to have a similar what would it take to pick up my life and move here moment. But I didn’t. My life has changed quite a bit since 2002. This time around, I was quite happy to leave and return home to my family.

Our Little Corner of the World

Our family lives in a Virginia suburb of Washington, D.C. The metro area is expensive, though not as bad as New York or San Francisco. We’ve thought about moving away to settle somewhere with a lower cost of living. But we haven’t.

Because we like it here.

The D.C. area has a lot to offer. The city itself is mostly awesome from a lifestyle perspective. Public transportation is abundant (though not always reliable). It’s broken into manageable neighborhoods. The museums are world-class and free. Good paying jobs are plentiful. Area residents are well-educated, diverse, and from all parts of the country and world.

Our suburb is very pleasant. It’s not sprawling or congested. The state of Virginia is far more laissez-faire and business-friendly compared to D.C., making the state a great place to settle down. Pockets are walkable, historic, modern, and cultural all at the same time. People from around the world visit our suburb and think…

What would it take to pick up my life and move here?

Living Free in Guatemala

Among the dozens of extraordinary people I met in San Diego was Pauline from Reach Financial Independence. She owns a guesthouse in Guatemala and spends part of the year there. She is location independent due to the nature of her businesses.

relocation-guatemala-400px achieve financial independenceShe’s crafted a life where she is in complete control of her time and location. Her passive and business incomes are plenty to sustain her lifestyle.

I felt nostalgic speaking to her about her property in Flores in the north on Lago Petén Itzá. Flores is the base town for visiting the ancient ruins of Tikal (of Star Wars fame). I visited during my big trip and then again with my Dad a few years later on an excursion from Belize.

As a budget backpacker traveling on a tight budget, I always prided myself on finding the cheapest beds everywhere I went. Flores was cheap.

But the two cheapest non-free rooms I ever stayed in were in Vang Vien, Laos and San Pedro la Laguna Atitlan in southern Guatemala. I paid $1.25 US per night in each place for a decent room of my own. The San Pedro room was bigger. Vang Vien, fewer mosquitoes.

Despite having my life threatened and getting robbed by four machete-wielding miscreants while hiking around Lake Atitlan, I was fond of San Pedro. Everything I needed was a short walk or boat ride away. The lake is stunning.

Considering that the cost of living in a place like San Pedro is so low, our family could move there TODAY and be financially independent for the rest of our lives.

If we stay in the Washington D.C. area, we’re many years away.

Shortage of Assets vs. Cost of Living

From one perspective, we do not have enough assets to be financially independent.

Alternatively, we have plenty of money to retire early, we just aren’t living in the right place.

To become financially independent, we need to either move or build our assets. We’ve chosen to keep building assets.

But every time I peek at our net worth, I’m reminded that we could achieve financial independence sooner (even immediately) rather than wait until I turn 55. If only we’d move where the cost of living is lower.

I highlight Guatemala as an extreme end of a spectrum. Compared to Washington D.C., San Pedro is dirt cheap!

Though Guatemala is extreme, there are undoubtedly affordable cities and towns closer to home. We could move to a city or town where the cost of living is low, schools are good, and we’d have everything we need and still be able to achieve financial independence earlier. So why not move there?

cost of living achieve financial independence

Why Not Move to Achieve Financial Independence?

As adventurous and blog-worthy as it sounds, our family is not moving to Guatemala. Maybe someday we’ll visit together and take Spanish lessons in Xela (aka Quetzaltenango). Or volunteer at the school at Casa Guatemala. Or we’ll explore the unique natural pools and waterfalls at Semuc Champey or the insanely cool river cave near Finca Ixobel.

Our area has far better schools and infrastructure. It’s safe and convenient to family, airports, recreation, and everything we need and want. Our friends are here. Our kids are making friends here.

But the conversation still comes up with Mrs. RBD every once in a while. We ask ourselves: Why don’t we move to be in an even better financial position?

The answer is usually: Where to?

My hometown doesn’t appeal to her because it’s colder than D.C. and she only knows my friends and family. I’m not sure it appeals to me all that much either.

Her parents no longer live where she grew up. So not much there is drawing her back.

We met in the D.C. area. It’s where we dated, lived in our first place together, married, bought a house, and started a family together. The D.C. area is part of who we are as a family.

So leaving is a big deal.

And there’s that lack of affordable places where we want to move. I suppose we could go exploring to find somewhere else to live. But after 13 years of living and building relationships, it’s difficult to justify leaving, aside from the cost of living.

So we either stay put, or start from scratch to find a new place to settle down. After already settling down here.

The thought of that is unsettling. For us today, moving isn’t worth it.

You can, therefore, deduce that our desire to stay where we are outweighs our desire to achieve financial independence earlier.

Location in the Financial Independence Equation

Location is the key component to the financial independence equation. Because location determines cost of living, in terms of housing, transportation costs, food, and available services.

Backpacking in parts of Asia and Latin America is cheap for food and accommodations. But we don’t want that now. We want a stable home for our kids to grow up in, where they can build the intellectual foundations to go and find their own adventures someday. We live in an ideal place for that, surrounded by like-minded families… like-minded in terms of raising kids, not in terms of pursuing financial independence.

The suburban lifestyle has its pitfalls. Namely, a reliance on cars and a mortgage.

Even with its pitfalls, the expensive city suburban lifestyle is the one we’ve chosen. We realize that the longer we stay, the more challenging a move to somewhere cheaper gets. As the children age, they’ll have a say in it as well. I’m guessing they won’t want to leave their friends and for something new because the other place is cheaper.


When I was 27, I was broke, unemployed and living with my parents. From that restarting point, I had the option to live and find a mate in a less expensive place. Had I been more informed about what it takes to become financially independent, I may not have moved to D.C.

Today, I consider moving here one of the best decisions I ever made.

But for the singles or young couples out there who aspired to retire early, a critical decision point may be near. If you chose an expensive city, expect to work a while longer. That’s not to say early retirement cannot be achieved in an expensive place. You’ll have a steeper mountain to climb.

Declaring that we’re going to maintain our current lifestyle instead of pursuing more immediate financial freedom is somewhat liberating.

We’ve built our nest and our household size is (probably) complete. We can now take the lifestyle we know and love and estimate what it’s going to take to reach our goal. College planning has become clearer. Our housing costs, while high, are affordable and predictable. My current career trajectory is steadily moving upwards.

Knowing that we’ll likely stay where we are makes planning for our retirement easier. Through working hard to achieve financial independence in an expensive city, we should have more money and options to relocate and/or travel extensively when we retire.

Do you struggle with the decision to stay or leave an expensive city? Could you achieve financial independence sooner by moving?

Photo by image4you via Pixabay CC0 Public Domain

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  1. We’ve thought a lot about this as well, and our situation isn’t all too different from yours. I think where we come out on it is that maybe we’d consider moving once we retire. Or perhaps we move with still a year or two to work, get know people and the area more and settle in. Tough choice though with lots to consider. And with all that said, staying putting isn’t a bad choice either.

    1. GS,
      If I recall, aren’t you NYC? That’s rough. Expensive and no space!

      Since we like our neighborhood too, even moving to a further out suburb is a risk. There’s a good chance we would move to as nice a neighborhood. So at this point, I don’t think we’d actually move until we’re closer to retirement. It’s helpful to have that date in the cross hairs so we can plan for it.

  2. To me it really comes down to whether you’re comfortable living in that area. There’s plenty of places we could move tomorrow and be financially independent; however, moving from where we live, especially internationally would be a big shift and make it much harder to stay in touch with family. If I was a single guy or it was just my wife and me with no kids it’d be a possibility, but with a 3 month old and likely another one on the way in 1-2 years moving doesn’t make sense for us.

    1. JC,
      We’re both in that family expansion phase which makes the big picture hard to look at. When the kids keep you awake all night, it’s hard to even think straight let alone plan ahead 15 years!

      Family is a big draw. Leaving was easy when I was single. But I’ve been here too long to move back. At some point we just accepted that we like it here and we’re staying. Took a weight off our shoulders.

      We talk about how cool it would be to live overseas with the kids on day. Maybe Spain. But we haven’t set up our lives to be able to do that. Part of why I am simplifying our lives and building multiple incomes streams is to give of the option to maybe try moving away someday. Kids are too young at this point.

  3. It’s a tricky topic. There are lots of things that I love California, but the things that I do with my free time don’t necessarily require me to live in California, something that certainly has a premium attached to it. Do I value the opportunity to decrease the length of my career over proximity to family? I’m still figuring all that out. I’m sure a big influence over where I ultimately end up is going to be where mystery future wife would prefer to live, because honestly as long as you give me a good mattress and some reliable wifi and I can make that situation work. 😀

    1. TJ,
      Wifi and a mattress. Reminds me of my former self. Now I need snacks and butt wipes pretty much anywhere I go.

      Location is a team decision now. Adds a whole element. Good that you’re thinking about this early. Decisions you make now will effect you later.

  4. We love CA too, my wife grew up there, it’s a place we have considered moving, but the cost of living is tough on the West Coast. Much easier to pick up and relocate when you are younger or single. With three teenagers firmly planted in school and friends it tough to do now. We are certainly considering a move once the kids are on their own, but than the tricky part becomes were they settle and we want to be somewhere near them too.

    1. Brian,
      I hear ya. As much as we want to travel in retirement, I’m sure we’re going to want to be near our kids. Our parents don’t have that, and the distance between us has an impact on our lives. We’re still a long way off from these issues. But I know that the more money we can save, the easier they will be to deal with when they get here.

  5. I live in the DC area, just on the “right” side of the river, but agree with what you said about the area. It might not be the cheapest area to live, but I don’t have to worry about being with out a job and I never had to worry about my property value dropping. Those would be killers to the fi dream. Also, hopefully with the better than average to top schools in the area the kids will be less likely to need financial assistance later in life, so I am hoping to retire, move and send the last kid off to college all in the same year. Thanks for the bog, I look forward to reading more.

    1. Matt,
      Plentiful jobs is another reason to stay. My career is very much DC centric, so it makes sense from that standpoint. But location is becoming more flexible. I work with people who are remote. So location arbitrage may be an option at some point. Get to keep the salary but live somewhere cheaper.

  6. We have a skewed perspective because we lucked into being able to telecommute from a slightly cheaper place compared to the big city we left. But of course the big flipside of a cheaper place is lower earnings. I really do think if you’re dedicated about saving, and don’t get caught up in the lifestyle inflation that often happens in the bigger cities, but it’s just as easy to hit FI in a more expensive city, just because you’re most likely getting paid a lot more. The temptation is the problem, not the absolute cost.

    Having said all of that, I do think that moving to a smaller, less expensive place did help accelerate our timeline to early retirement in a big way. But I mostly attribute that to having way fewer opportunities to spend money, and less to the actual cost of things. And, it does make me happy that we could afford a house here instead of being crammed into some small condo in a bigger place (“afford” being our definition, not the banks’). It has definitely improved our quality-of-life to have more space… And less traffic. 🙂

    1. ONL,
      The suburbs can actually help keep spending down. Since we’re further out, we are more likely to stay home. For example, fourth of July, our neighborhood has its own fireworks display. So we avoid the downtown mess and associated costs.

      Low earnings in a smaller town is a big downside. I’d assume I could keep a relatively high salary by telecommuting. High salaries in expensive places can still be great wealth building tools if lifestyle remains under control.

  7. We have considered this, as you may know, Vancouver isn’t the cheapest place to live. What we have considered is rather than moving, we can live in a cheaper COL place for a few months each year and rent out our house. That way we’d still have a “home” base.

    1. Tawcan,
      I like that idea. Especially if your home is a low maintenance place (apartment, condo etc). We have a yard that would need maintenance. And the neighbors probably wouldn’t like AirBNB. But if it works for you, I like it!

  8. RBD,

    Great meeting you at FINCON!!! You listed where I want to retire! Carmel! I had an assignment in Monterey for 3 years and loved it!!! I’ve still got a little less than 4 years til a military retirement. If I continue to make smart buys in real estate between now and then, and continue to save, I think we could do it. At least long enough for our kids to do junior high and high school there.

    1. Rich,
      Likewise, great meeting you at FinCon. Oh man, every time I go to Carmel I am blown away. I remember liking it so much as a kid. Then after traveling for 14 months, I returned and thought it wouldn’t live up to my memory. But it definitely did. That view of the beach in the evening is incredible. I guess that’s why it’s so expensive. Good luck in your goal to settle there!

  9. Great topic.
    We’ve taken the equation backwards a bit: we moved to the a place with better wages temporarily to make more money and achieve financial independence faster, then we plan to move back (it wasn’t always the plan, but that’s what it’s looking like for now).

    I have been far away from my family for more than ten years, and it feels bad. For a while it was ok because we were still close to friends and my wife’s family, so we still had strong emotional support. Having moved to a new place, far away from both families (we’re talking a 12 hour plane ride either way) and friends, it’s been difficult. I now understand clearly that our next move will have to bring us closer to family and friends, as it matters more than the cost of life in the grand scheme of things.Making lots of money but being far away from the people I like is growing old very, very fast.

    1. Stockbeard,
      On the plus side for the big expensive cities, is the ability to earn more. That’s why they got so expensive. The key is to sock away as much as possible and keeping cost of living low so you can eventually take off. Sounds like you’re putting the plan into action already.

  10. I’ve been thinking about this post for a few days 🙂 We left an area of town that had much lower housing expenses in 2012 to move to a very nice suburban neighborhood on the other side of town. On paper, the right thing to do was to stay… we had only 5 years left on the mortgage, no property taxes due to an abatement, and our youngest was about to start Kindergarten so day care expenses were about to drop. However – moving to a much more expensive area – while initially definitely was a strain on our budget – was absolutely the very best decision we could have ever made for our family, for all of the reasons mentioned above. But for us the #1 and #2 reasons came down to safety of our family and better schools. I never expected to love our new neighborhood and everything that goes along with it SO much, nor did I have any clue how much our ‘happiness factor’ was going to play into this equation. The bonus was buying when the market was down 🙂 Now with things on the upswing again and the last car payment out of the way, we are really able to leverage our money in ways I never expected.

    1. Sage,
      Glad moving to the more expensive area worked out for you. Must have been a tough decision to leave the last five years of a mortgage to get another big one. School quality is essential. We are lucky to live in a district where most all of the schools are very good. But we pay for it in property taxes.

  11. I moved to Portland to work, but stayed because I liked it here. The cost of living was much lower than other major cities on the west coast and it was great when I was young. Now the cost of living is rising quickly and we’re thinking about moving to a cheaper location after we both retire. We don’t have a good location to move to, though. I don’t like CA. It’s way too busy there. We like Santa Barbara because we went to school there, but I don’t think we can afford it.

    1. Joe,
      Sounds like a difficult dilemma. The longer you stay anywhere, the more affordable it becomes, if you working for market rate salary. Your situation is different being a stay at home Dad and blogger. CA seems out of the question if you’re looking somewhere cheaper to move. We have family that is looking for a cheaper place to move to in CA and having trouble identifying somewhere.

  12. I too live in the DC area and in the VA part of town 🙂 My wife and I were both born in raised in the area and while we both fantasize about moving away from the area for a lower cost of living I don’t think that we could actually move out the area and away from friends and family. That means I’ll probably have to work a little longer than I anticipated but being able to spend time with our families each week is slightly higher on my list than being retired and never seeing them. Thanks for sharing your perspective, I enjoyed the read!!!

    1. MSD,
      Hey neighbor! With both of you from the area, that’s definitely tough to get away. Not too many natives in these parts.

  13. I grew up DC and know how crazy that market is – but if you’ve bought a house the past 10 years in DC you’ve made an incredible investment! So if you can invest in real estate in an in demand market then it makes sense to stay.

    I live in Chicago and the only way I could get ahead was by MOVING to a different less expensive area in my city. So you can stay in a city that you want to live in, but more to a more affordable area. I don’t know about DC anymore, but in Chicago you can still find great deals on rent if you move just a little bit farther outside of the city.