Beware of the Hidden Costs of Relocation

Posted: 30 Sep 2010 04:30 AM PDT

Recently I found myself faced with relocating in order to start a new job. As difficult as moving is under normal circumstances, the stress of my move was compounded by the poor economic climate and the fact that my credit has suffered as a consequence. Relocating is expensive but proper planning and being aware of extra expenses that are often overlooked can be a simple way to save hundreds or even thousands of dollars not to mention the untold cost of extra stress. Here are some areas of difficulty I encountered from the more obvious to those you may not consider until you find yourself in the position (which hopefully you won’t after reading this!)

: Photo: Shenghung Lin

The Job Search: Although not a cost of relocation, finding a job in the first place proved more challenging due to my poor credit history. With many employers routinely conducting credit checks on potential employees, when two candidates have basically the same education and experience, a bad credit check may be the difference between getting the job and continuing to search.

Utilities: One of the expenses that I encountered early on that was expected, but higher than I had anticipated was the cost of connecting utilities. Even though I moved into an apartment, there was still a connection fee (which I did expect), but due to my poor credit I was also required to supply a security deposit.

Securing an Apartment: Speaking of apartments, poor credit can adversely affect you when looking for an apartment. A couple of places wouldn’t even talk to me when they found out my credit rating, but I was able to produce a letter of recommendation from my previous landlord which helped me to get the apartment I finally moved in to. I had to pay a bit more up front, but I got what I wanted in an area that was good for my commute and close to a good school for my daughter.

Cell Phone Carriers: Another expense in my move was switching cell phone carriers. The one that I used to have didn’t have good coverage in my new city, so I found one that did. However, due to my credit, I needed to sign on to a pre-paid plan that was not as good for me. In time I hope to convert to another, better plan as my credit improves.

Insurance: The city that I moved to has higher insurance rates than the previous town I lived in and my rates are even higher due to my credit. My renters insurance and car insurance both nearly doubled due to these two factors; something worth checking out when deciding where to move.

There were many other hidden expenses to moving which were not be directly affected by my credit history, but I was able to mitigate the additional burden on my already stretched finances by keeping tabs on several areas:

Travel costs such as gas, hotels, and meals out that arise during the move and as you check out new areas. If you are moving to an area where you already know some people, try to work with them to find places to stay. Just remember not to overstay your welcome.
Moving supplies like boxes, packing materials, and a vehicle. It’s easy to find free boxes from businesses or friends and neighbors. For packing materials you can use newspaper (check out your local recycling facility to see if they have some you can use) or towels, sheets, and other soft household goods.
The cost of your commute in the new area you are planning to move to. What is the price of fuel? How about tolls on the roads you will travel frequently? These increased costs can add up quickly. Also consider parking because in if you work in a city and your company does not have private parking, you may find yourself funding this expense as well.
Cost of living expenses. Some areas have significantly higher grocery prices, for example. Also, many public schools have various fees for books, supplies, and activities, so if you have children you will need to factor these in as well.
Other expenses. Does the area you are moving to have property taxes? What about excise taxes for your vehicle? If you are crossing state borders, you will also need to transfer the registration on your car which may entail a new title as well. These fees and taxes are often a surprise to those moving into a new area. There are many good sources for information on these types of expenses, including the local Chamber of Commerce or just a quick search on the internet.

Having poor credit does not make it impossible to relocate, but it may make it more difficult. Knowing the status of your credit and being prepared to make sacrifices will go a long way toward helping to repair it. Also, do lots of research into the area you are moving to so that you can avoid some of the surprises that I found. In the current economic situation it is more important than ever to be wise with your finances.

Sara Coleman is a working mother who works for Sudden Pay Day. With a full time job and a family, a priority of hers is making the most efficient use of her time.

Dollar Matters: Business Edition

Posted: 29 Sep 2010 09:00 AM PDT

One of the ways you can build an income stream is to start your own business. But you don’t have to start your own business to find success in that arena. If you are looking for success in business, whether on your own or within someone else’s business, these posts might be able to help:

Best Home Based Business Ideas

The Digerati Life offers some great ideas for home based businesses. If you want to work from home, you might try some of these suggestions.

The Cost of Starting A Franchise

Over at Boomer & Echo, there is a great post on the costs of starting a franchise. Before you commit, make sure you understand what is involved.

Limited Liability Corporation (LLC) vs. C Corporation for Your Business

Jeff Rose at Good Financial Cents lays out the pros and cons of two popular, and different, business organizations.

Should I Buy This Book? Review: How To Run A Thriving Business

Financial Poor provides a helpful book review of How To Run A Thriving Business. Includes some of the high points of this book, with a recommendation to buy.

Building an Inexpensive Office Wardrobe

Alan Schram at Canadian Finance Blog offers helpful suggests for putting together a professional wardrobe without breaking your budget.

SBA Program Renewed

I wrote this post over at Personal Dividends. President Obama renewed a popular SBA program that guarantees 90% of the amount of a small business loan. But will it really help the economy?

How Do Employee Stock Options Work?

A helpful look at employee stock options from Ryan at Cash Money Life. A must-read if you are considering receiving — or already getting — stock options as part of your compensation at work. Also helpful for those thinking of offering stock options to compensate their own employees.

Life Insurance Blog

Thursday, September 30, 2010