Should you move to earn more money?


This article reflects the opinions of Earnest, not Credit Karma. Earnest offers financial products on our platform, and we make money every time you get a financial product from Earnest through our platform.

Should you move to earn more money?


Congratulations! You got a great job offer for a position that pays significantly more than you earn now. The company seems great, and you loved the team when you interviewed. The only catch: It'd require you to relocate.

If you're considering moving, know that you're not alone -- data from Earnest found that in recent years, there has been a migration west for graduates, particularly from elite schools. This isn't surprising, considering that cities on the West Coast also had some of the fastest job growth in the country in 2015.

No matter where you're considering moving, there is a lot more than salary to take into account. Read on for the other factors to think about as you make this important decision.

Moving costs

Moving can be as simple as loading up your car and driving for a few hours, or it can require hiring professionals to do the heavy lifting (both literally and figuratively) for you. Before accepting the job offer, see if the company will pay for your moving expenses. If it won't, rest assured that you may be able to deduct any money you spent on moving expenses when tax time comes around.

The actual cost of moving can vary widely, depending on how much stuff you have and who's doing the work -- typically ranging from a few thousand dollars to tens of thousands of dollars. Before picking a moving company, call around to get referrals and quotes from different companies.


If you're looking to rent an apartment, keep in mind that you'll likely have to pay a security deposit that'll probably amount to one to two months' rent (or more, depending on your credit).

On top of that, if competition for rentals is intense in the city you're moving to, you may have to spend a few nights, or even weeks, in a hotel or with friends while you find an apartment. If you have to break a lease for your current place, you might also have to pay a few months' rent or extra fees.

However, the good news is that the high rental prices you may have seen or heard about in the city you're moving to may end up being more than what you end up paying. Earnest data found that young professionals spend an average of 22 percent of their income on rent -- rather than the old 30 percent guideline.

In addition, many of these numbers you might be seeing in news headlines are based on estimates for entire units - not actual rent payments, which often take into account a number of housemates. This may be why Earnest data shows that most young people end up paying a fraction of "market" price, and that fraction gets smaller in more expensive housing markets.


Your new salary may not translate the same way it did back home if state taxes differ between the two locations. This could work for or against you. Some states, such as Texas, don't have income taxes, so moving to one of these states could help you. In contrast, moving to a state that collects income tax might take away some of your income.

It's also important to remember that if your new job comes with a hefty pay raise, you could be pushed into a higher tax bracket, which means your tax rate will be a greater percentage of your income.

For a more complete picture, it can also help to compare property and sales taxes in your current location to your new location. These can also impact how far your paycheck goes.


Cities with great public transportation systems, such as New York and Chicago, make it easier for residents to avoid driving, but this certainly isn't the case in every city. If you currently live somewhere you don't need a car, moving elsewhere may require you to buy a vehicle.

If you will need a car, keep in mind that car insurance can be very expensive in some cities but very affordable in others

Sometimes, the annual costs of owning a car, which can vary between around $6,000 and $10,000, can wipe out any salary increase you'll see. Also think about your future commute -- how does it compare to your current situation?

On the flip side, if you currently own a car and are moving somewhere you'll be able to get around without it, you might be able to save thousands each year, effectively giving yourself a second pay bump. Make sure to evaluate your transportation situation as you compare budgets between the two cities.

Other costs

Look at your other monthly costs to see how they may change once you move. Expenses such as utilities, insurance, health care and even groceries can all vary widely depending on where you live. This calculator can help estimate how far your current paycheck would go in another city, and takes into account expenses such as groceries, utilities and health care.

You might also want to consider what costs are essential to your own sense of happiness. For example, some cities have access to fresh produce year-round, while in other locations you'll have to get used to less variety (or pay a premium). Likewise, if the weather is good year-round, you might not need to pay for the gym -- an option you won't have in a city with harsh winters.

Opportunity costs

Lastly, take a look at how your move could affect your future -- whether that's income potential, your professional network or even whom you're looking to meet if you're single.

While a less-expensive city might be appealing to your bank account, cities with higher housing costs tend to offer greater upward mobility over the long term.

If you've built a great network in your current city and see opportunities for growth there, perhaps it's a better idea to stay put. On the other hand, some cities offer great networking opportunities for different fields: think San Francisco for technology, Washington, D.C., for politics, or New York for media and finance. Depending on where you see your career going, it could be useful to build a new network in a hub for that industry.

Bottom line

At the end of the day, moving to a new city is a huge life decision, and not one you should make based on any one given factor. Most importantly, make sure your choice makes you happy. And remember, you can always move again.

About the author: Catherine is the senior editor at Earnest, where she works with national financial experts and innovators along with Earnest's data science team to tell stories about new-fashioned finance. Before joining Earnest, she worked at the automated investing service Betterment.

Prior to that, Catherine spent a decade in journalism with jobs at Associated Press, Wall Street Journal, and Huffington Post. She graduated from Stanford University and studied journalism at the Columbia University Graduate School of Journalism. Her passion is for consumer advocacy and empowerment through better information and technology. You can read more of Catherine's work on Earnest's blog.

New to Earnest? Earnest is a technology company that combines data science, elegant design, and efficient software to bring people a fast, low-cost, and hyper-personalized experience for financial services. Learn more here.

Editorial Note: The opinions you read here come from our editorial team. While compensation may affect which companies we write about and products we review, our marketing partners don't review, approve or endorse our editorial content. Our content is accurate (to the best of our knowledge) when we initially post it, but we don't guarantee the accuracy or completeness of the information provided. You can visit the company's website to get complete details about a product. See an error in an article? Use this form to report it to our editorial team. For questions about your Credit Karma account, please submit a help request to our support team.

Advertiser Disclosure: We think it's important for you to understand how we make money. It's pretty simple, actually. The offers for financial products you see on our platform come from companies who pay us. The money we make helps us give you access to free credit scores and reports and helps us create our other great tools and educational materials.

Compensation may factor into how and where products appear on our platform (and in what order). But since we generally make money when you find an offer you like and get, we try to show you offers we think are a good match for you. That's why we provide features like your Approval Odds and savings estimates.

Of course, the offers on our platform don't represent all financial products out there, but our goal is to show you as many great options as we can.

Comment on this Article

Write your comment:
Enter Your Comments