A job change is no longer just about higher pay or a better title. It can also be about achieving a healthier life balance or simply trying something new. In many cases, a new job includes relocating to a new community. A new opportunity can be very exciting, but even the most positive change comes with financial implications, especially when a move is involved. It’s good to understand the unexpected costs around relocating. A little knowledge can help you capitalize on the momentum of your new role without compromising your overall financial plan.
Here are some key questions to ask yourself before you relocate for a new job:
What is the cost of living in the community I'm moving to?
Cost of living fluctuates dramatically across the country. If you’re getting a pay raise but moving to a city where all the necessities of life are significantly higher, that salary increase won’t be as beneficial as it looks on paper. On the other hand, if you’re relocating to a community with a much lower cost of living, you may find yourself with extra funds that could be invested for your future.
Are there hidden costs I'm not seeing?
A new job location often comes with costs that haven’t yet been factored. Hidden expenses like utilities, parking, gym memberships, entertainment, recreation and even education can all add up quickly. To make the most of your new opportunity and pay increase, it’s essential to have a budget and overall financial strategy that accounts for all of the upfront and unforeseen circumstances.
What will my moving costs be?
Once you’ve done the math, located a nice house and crunched budget numbers for your new life, you still have to factor in moving costs. This can be a substantial expense, depending on what you are planning to bring along with you, such as cars, pets, furniture and so on. Will your new employer cover some of or all of this expense? You need to find out before you accept the job. Fortunately, Revenue Canada offers tax deductions for people moving at least 40 kilometers to start a new job or a new business.
Even with these tax deductions and anything that is covered by your new employer, there are bound to be unexpected costs around moving. Depending on what you bring with you, setting up your new home and life has a price tag. From kitchen utensils to furniture, vehicles and appliances, it’s expensive and it all adds up. Having savings in place to fall back on as you make the transition is an absolute must.
A new job in a new city is an amazing opportunity this decision could have a major impact on your financial reality and future. Don’t make this decision alone. Talk with your financial advisor about putting an overall strategy in place that protects you today and positions you for the brightest tomorrow. If you don’t have a financial advisor, there’s no better time to establish that relationship as you move forward with a defining life moment.