6 Questions to Ask Yourself Before Deciding to Move—So You Can Prepare Yourself and Your Wallet

Moving is expensive. These questions will help you get the full financial picture before you start packing up.

Stack of cardboard boxes in empty apartment
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The decision to move can be both logistically and emotionally complicated. Whether you're moving to a new neighborhood or a new state, the process can involve tough goodbyes and big financial undertakings. While some moves are more or less decided for us, like when you need to move for an exciting job offer or to make room for an addition to the family, other moves can be harder to justify and determine if they're worth the stress on yourself and your wallet.

That's why it's important to weigh the financial practicalities to ensure that moving is the right step for you and and anyone else you may be moving with. Whether you have your sights set on renovating, downsizing, or relocating, finance experts say you've got to ask yourself these six questions to get a handle on how a move will affect your budget.

Do you want a turnkey house or a fixer-upper?

Having an idea of what kind of home you're ready to invest in can clarify budget expectations. There may be opportunities to save money if you're looking to purchase a fixer-upper instead of a brand new house, especially if you renovate and resell the home. Since they need more work, fixer-uppers are usually sold at lower prices than move-in-ready homes. Plus, a fixer-upper is customizable to your tastes and needs.

However, there are non-financial costs to also consider with these homes, such as time and labor. And if you can't live in your fixer-upper during the renovation process, you'll need to account for accommodation and storage costs.

With a move-in-ready home, you can better predict and plan for your costs, though you pay for this convenience with higher housing prices. Ultimately, having an idea of what type of home will best suit you and your family's needs can help you financially plan for moving.

What is your budget for renovations?

Whether you're making minor repairs or remodeling a room, it's important to factor these renovations in to your overall budget. Depending on the status of the home and how much you're willing to spend, your renovation budget can range significantly. Prioritize needs over wants to stay on target. If it's a roofing repair or a bathroom remodel, consider all the costs associated with the project, from materials to contractors. Since you can't always plan for everything, make sure to set aside an additional 10 to 20% in the budget for unexpected hiccups.

Does it make sense to upsize or downsize?

If you decide to upsize or downsize in your move, this will affect how much you potentially spend or save. Consider how you use your current space, how you'll use the potential new space, whether you need to purchase more furniture, whether you'll need to spend more on maintaining additional space, and if you can afford to purchase a bigger or smaller home.

Honest answers to these questions can help you narrow your search to cities where you can afford what you want. Most people assume that downsizing automatically means saving: You can sell or donate furniture, spend less on the purchase of your new home, and pay less on maintenance, utilities, and taxes. But it's not guaranteed. If you move to a smaller space in a city with a higher cost of living, then that may throw your budget into the red, or you may simply break even.

Will the cost-of-living change in your new location?

Whether you're moving from a rural area to an urban area, vice versa, or staying the same, there may be changes to how much you should budget for living expenses. Groceries, gas or transportation prices, utility fees, and taxes are all expenses that can increase or decrease when you move to a different location.

"Many people assume that electricity and other utility expenses will be relatively the same as the area they are moving from," Taylor Kovar, a certified financial planner in Texas, says. "But due to the lack of infrastructure and reduced population, many times the costs of these items are higher." He adds that many people also don't account for utility companies' deposits when moving into a new development or rural area. Another hidden expense he's seen is a rise in health insurance and other premiums for car and homeowner's insurance.

Research potential new locations well ahead of time to have a more complete picture of all the true costs of living.

How much does the moving process cost?

Aside from the costs of the house itself, the true cost of packing and moving unfolds slowly. According to Forbes, the national average cost of moving in-state is $1,400 with a range from $800 to $2,500—based on a two-person moving team doing an under-100 mile move. If you're crossing state borders, the average cost of movers increases to between $2,200 and $5,700.

Another important cost to consider is interim housing. If the closing date on your current home is earlier than the move-in date on your new home, then you'll have to factor in the cost of temporary living accommodations and storage.

There are many ways to cut down on moving expenses. Moving yourself, having help from friends and family, or hiring movers for only the essentials can all save you money. But don't underestimate the cost of the moving process itself. Packing materials, rental trucks, and gas (especially for a long-distance move) can really add up.

Do you need to live near work?

The flexibility to work from home (or anywhere) has increased significantly over the past couple years, and it's projected to become more and more common across industries in the future. This offers more opportunity to those shopping for homes to live farther away from the workplace.

Marco Sison, a financial coach with Nomadic FIRE, says that "remote work offers a unique opportunity to slash housing budgets through geographic arbitrage." Geographic arbitrage essentially means earning income in a strong economy and spending (and living) somewhere with a less aggressive market. Sison gives the example of Los Angeles versus Las Vegas. "A one-hour $20 airplane ticket separates Los Angeles from Las Vegas," he says, "yet moving from L.A. to Las Vegas can save you over $12,000 a year on rent alone."

Going one step further, moving to a cheaper country can reduce your housing expenses even more significantly, Sison says. "Jumping on an airplane to another country may seem like an extreme way to cut your budget, but the savings can be financially life-changing," he remarks. Depending on your work and family circumstances, living abroad may be a win-win adventure.

Some of these moving questions above may have immediate, simple answers, while others may push you to confront your larger life goals and plans—but each of the considerations are important for you to make an informed decision about your next move (or stay).

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