We’re no strangers to high cost of living areas. We’ve lived in Seattle, Charleston, Washington DC, and now we just moved to the Northern California.
Going from a low cost of living area in the Midwest to the extremely high prices of Wine Country, there’s only one way we’re going to survive this… BY CREATING A SOLID BUDGET!! The budgeting tips you’ll find below are going to help you not only survive, you’re going to THRIVE no matter where you live.
LEARN HOW TO THRIVE IN A HIGH COST OF LIVING AREA WITH THESE SIMPLE BUDGETING TIPS
Whether you live on the East Coast, the West Coast, or somewhere in between, these budgeting tips are going to help you make the most of your paychecks.
We spent 3 years living in Washington DC, one of the most expensive cities in the country.
Guess what??? We were able to save $20,000 during one of those years on a combined income of $75,000!! That’s crazy in such an expensive city.
We recently moved to Northern California which makes DC look affordable! I’m not worried though because we’ve got a secret weapon… A BUDGET!!
I’m a firm believer that budgeting is the key to financial success. I don’t care where you live, if you’re not budgeting your money, you’re not going to achieve your financial goals!
Why You Need These Budgeting Tips
Listen, I’m going to go out on a limb and say you’re here because you’re looking for some help with your budgeting skills. Am I right??
If you’re struggling to pay off debt, living paycheck to paycheck, or just can’t seem to figure out where all your money went, you’re in the right spot.
We’ve been living on a budget for quite a few years now. It takes a little getting used to and it can be time consuming at first, but once you get the hang of it, it’s a piece of cake!
Budgeting is a powerful tool because it shows you were every single dollar of yours is going. There’s no more guessing where all your money went at the end of a pay period. You know where it went because you told it where to go!!
There are a lot of resources online to help you learn about budgeting. You can read through things like this guide to budgeting or how to set up a Cash Budget System.
Or you can join a totally FREE step-by-step budgeting course here.
It doesn’t matter how you get the information, creating a budget is going to help you thrive even if you live in a high cost of living area.
Budgeting Tools For Beginners
If you’re new to budgeting, it can be overwhelming at first. Don’t worry, it’s not as hard as you might think.
The best way to start budgeting is to have the right tools. We created a FREE Budget Binder to help you get started on the right track.
You can learn more about the FREE Budget Binder Here.
If you really want to make things easy on yourself, check out this Annual Budget Binder. It has over 90 pages of financial tools to help you get started.
With the Annual Budget Binder you get things like a Budget Planner, Savings Trackers, Debt Tracker, and even a plan to save up a $1,000 Emergency Fund.
This Budget Binder has everything you’ll need to create a solid budget and start managing your money the way you want to!!
Budgeting Tips For High Cost Of Living Areas
Make A Budget
The first step to thriving in a high cost of living location is having a solid budget. If you don’t have a budget in place, you don’t stand a chance of winning with your money.
Budgeting is a great way to control where you spend or save your money. We’ve been budgeting for a decade and it’s helped us cash flow 2 Bachelor degrees, 4 new cars, and put a nice down payment on a house.
A budget is the secret weapon to crushing your debt and saving more money! If you need help setting up your budget, sign up for our FREE budgeting course below. It walks you through step-by-step instructions to build your budget!
Start Saving Money With Our FREE Budget Like A Pro Course
My personal favorite budget system is the Cash Envelope Budget System. It’s super simple to use and it’s effective. We’ve used it to pay off debt and save over $100,000 towards retirement.
If you’re looking to start your own cash budget system, check out these super cool printable budgeting envelopes.
Pay Off Debt
When we lived in DC it was crazy expensive. Our rent ate up over 30% of our monthly income. Not to mention the cost of food and everything else was just downright expensive.
We knew that if we wanted to thrive in that high cost of living area, we needed to get rid of any debt we had. We crushed the last of our debt in the first year there and lived comfortably after that.
Honestly, this piece of advice applies no matter where you live. If you have debt, get rid of it. Think of how much stress would be out of your life if you didn’t have to worry about how much money you owe people.
For some tips to pay off your debt fast, check out our post How To Get Out Of Debt Fast And Live Debt Free!!
Build An Emergency Fund
This is an important step to take. You need to have an emergency fund! I don’t care if it’s $500 or $5000 at this point, just get one started!
Think about it, if you’re living paycheck to paycheck in a high cost area, what’s going to happen if your car breaks down or you have to make a trip to the emergency room. How are you going to pay those bills?
That’s where the emergency fund comes in. If you have an emergency fund in place, it’s going to save you the stress of worrying how to pay those bills and it won’t impact your daily life.
Even better, your budget should be untouched because the emergency fund protects you.
If you don’t have an emergency fund already, sign up below and we’ll send you a FREE cheat sheet to saving $1,000 in just 3 months! It’s super simple and it works!
Cut Back On Groceries
Groceries are one area where we always found ourselves going over budget. It’s really easy to buy more food than you actually need.
If you want to stick to your budget, you have to follow a couple basic rules when it comes to food.
- Don’t grocery shop when you are hungry. You’ll end up buying stuff you don’t need.
- Grocery shop with a list and stick to it!
- Grocery shop alone, you’ll spend less.
- Don’t go out to eat as much. Going out to eat a couple times a week really adds up throughout the month.
- Do some meal planning for the week. Check out our Free Resource Library to get a printable meal planning worksheet.
- Stretch the food you have. Get creative with the food you have in your house and try to stretch the time in between trips to the grocery store.
For even more great ways to save money, check out this post on How To Save Money At The Grocery Store.
Ask for Discounts… On Everything
There is no shame in asking for discounts on the purchases you make. You never know, it might just save you a ton of money by asking a simple question.
We ask for Veteran discounts at Home Depot all the time. It’s literally saved us thousands of dollars over the last two years while we upgraded our house.
There are many different discounts out there. Try asking for military or veteran discounts if you were in the service. Some places have discounts for AAA members, students, or seniors.
If they have a rewards program you might get a discount. Target has a 5% discount if you have their Target Red Debit Card.
Don’t be afraid to use coupons either. They are a great way to save some money. The bottom line is, Don’t Be Afraid To Ask About Discounts to help you save money.
Cut Unnecessary Expenses
We’ve all got them, you know, those expenses that are wants and not needs. Do you really need to stop at Starbucks every morning and spend $5 on a coffee?
You could just get yourself a nice coffee mug and a coffee pot to make your own. We make our own coffee each day and it saves us a ton of money.
When you’re setting up your budget, think about all the things you spend money on that you really don’t need to. I bet there are a lot of things you spend money on that you could do without and not even notice they are gone.
If you really want to thrive in a high cost of living area, re-think all your expenses and cut out the unnecessary ones.
Reduce Your Utilities
Nobody likes paying high electricity bills and you’re probably tired of telling the kids to turn lights off when they leave the room. Reducing your utility bills can be a great way to have more money in your pocket no matter where you live.
One of the best ways to quickly reduce your utilities bills is to just call the utility company and see if they will reduce your bill. It never hurts to ask and you might be surprised by the answer you get.
Our house in Minnesota is pretty old. After we moved in, we found out that it leaked air all over the place. We took some steps to help insulate and plug some of those air leaks and we’ve seen our energy bill come down because of it.
Here are some great tips and tricks we used to reduce our energy bill. 5 House Hacks To Reduce Your Energy Bill
Ditch Your Car, Get A Bike
Depending on where you live, you might be able to get by without a car. When we lived in DC, we were close to a Metro Station so that we could use that to get around.
We saved money on gas and car maintenance by using the Metro to get around the city. Most major cities have good public transportations that can help you save money.
If you live close to work or close to amenities, you might want to try riding a bike around instead of driving. Bikes can be very cost effective and save you a ton of money when you live in a high cost of living area.
The basic idea here is to find alternative methods of transportation that will save you money!
Find Free Activities For Fun
One of the cool things about being in a high cost of living area is that the city realizes it’s expensive to be there. Because of that fact, they tend to have a lot of free events you can attend.
Just because you’re in a high cost of living area, doesn’t mean you can’t have fun. You just have to find cheap or free ways to have fun.
When we lived in DC, they had cheap or free events all the time. With a quick search online you can find a ton of great ideas for fun in your area.
If you want some help coming up with free things to do for fun, check out our post for Summer Fun Ideas and we even put together a list of Winter Fun Activities.
Get A Side Hustle
At some point you cut back your expenses to where there just isn’t anymore to cut back on. At that point, you have to start looking to make more money.
Finding a good side hustle is a great way to add some extra money to your bank account. We have tried many side hustles over the years and have always found it to be a great way to have some extra spending money or to help pay off debt.
You can learn more about our personal favorite side hustle here. This one actually helped us recently pay for a new SUV with cash! It’s nice having a side hustle that helped us keep the streak of no car payments going.
Aside from helping with the car, our Side Hustle helps pay most of our bills every month, which leaves us with more money to have fun!
If you need more ideas for ways to make money, check out this list of ways to make extra money this week.
Get Frugal With Your Shopping
We all get tempted from time to time to go shopping. If you want to find ways to stretch your paycheck but still go shopping, try looking for trade shows, farmers markets or discount stores to shop at.
Don’t be afraid to wait for sales or use coupons. Make sure you are comparing prices if you’re making big purchases.
Stop Going Out To Eat…So Often
This is a great way to save money. I’m not saying you should quite eating out all together, but you should definitely limit it to once or twice per month.
Let’s do some math. If you go out to eat twice per week and average $15 each time, that’s $30 per week. Multiply that by 52 weeks in a year and you’re spending $1,560 per year on restaurants!! That’s a nice emergency fund if you saved all that!
Going out to eat less can save you thousands of dollars over the course of the year! When we saved $20,000 in one year, we didn’t go out to eat one time that whole year! It made a huge difference in our attempt to save money.
Going out to dinner is nice from time to time, but keep it limited. Not only will it save you money, but you’ll enjoy it more when you do finally go out to eat.
Choose Where You Live Wisely
Whether you already live in an expensive area or you’re planning to move to one, it’s important to pay attention to your location.
We’ve moved a lot over the last decade and we always make it a point to live close to amenities. We like to have gas stations, grocery stores, even shopping all close by. It saves us from having to travel too far for the things we need.
It’s also important to take into account your commute time to work, proximity to public transportation and if there is entertainment near you.
Our new house in California is right next to the elementary school, close to a grocery store and isn’t too far from work. It’s a good location to keep commuting costs down.
The location you live in can either cost you a ton of money, or have you living like royalty!
DIY Projects Aren’t Just for HGTV
With a higher cost of living comes higher cost to have repairs done around the house. Don’t be fooled, a lot of these fixes can be done pretty easily and for a lot cheaper than hiring someone.
When it comes to repairs around the house, I always turn to YouTube for help. I’ve saved us thousands of dollars by watching YouTube instructional videos on how to fix or update things around the house.
If you’re even semi-handy, you can save yourself a ton of money by repairing things around the house.
Here are some basic tools you’ll want around the house to do easy fixes:
With our recent move to California, I wasn’t able to bring all my tools. I brought everything on the list above and so far it’s been all I needed.
Get A Roommate To Save On Rent
If you’re single and want to cut down on the cost of rent or your mortgage, try getting a roommate.
When you split the cost of living between two or more people, it goes down significantly for each of you. Having a roommate can be a great way to save money in a high cost of living area.
Make sure you either know the person who will be your roommate or do a thorough background check on them. Saving money on rent only goes so far for quality of life if you end up with a bad roommate!
Workout For Free Or Cheap
Let’s face it, most of us want to stay in shape and finding a cheap gym isn’t easy anymore. Don’t worry through, there are plenty of options for free or cheap ways to workout.
For free workout plans, check out Pinterest. Do a quick search and you’ll find plenty of quick workout ideas that you can do in your home.
We always like to search for CrossFit WODs that don’t require any equipment. We do them at home and are usually done in under 30 min. They’re always a great workout.
If you’re looking for other methods of working out at home but are looking for something more structured, check out Beachbody On Demand. It’s $99 per year and gives you unlimited access to all the great Beachbody Workout routines.
It shouldn’t break the bank to keep you in shape. In all the areas we’ve lived in, we always managed to find cheap or free ways to stay fit. Make sure you do some research and find a plan that works for you.
What’s Your Favorite Budgeting Tip For High Cost Of Living Areas??
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