Tuesday, August 19, 2014

Relative Costs of Living

Thanks to Mike for identifying this for me.

Obviously states are big diverse places. Check out these figures showing the difference in cost of living in different urban places within the same state. There are differences in cost of living between urban, suburban and rural areas.

Estimates of cost of living are based on a "market basket" of goods and services thought to be purchased by the "average" consumer. Florida has a lot of retired people, and their purchases may well be different than those of a younger working person. Services like health care and schooling vary considerably from person to person. If you are rich, your market basket is likely to have more caviar and less rice and beans than if you are poor.

The quality of life is likely to be more due to the relationship between income and cost of living than on the cost of living per se. Indeed, the cost of living will be lower in places where wages and salaries are lower just because services can be provided at lower cost; the other side of that coin is that the dollar in the smaller paychecks in just those areas will go further.

Still if your working at home by Internet, and your income doesn't depend on where you live, you might want to live in a place with low cost of living. But then you may not have the cultural opportunities that you want in those places.

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