Financial Issues You Should Consider When Relocating
As you begin planning for your relocation, whether you are moving on your own or with a relocation package or company through your employer, it’s important to consider the costs associated with a big move, and to plan ahead.
Having experienced 4 major relocations myself, the last one from Boston to Southern California in 2005, I know a bit about what it entails, and provide a range of relocation services and resources for those moving to Carlsbad and the North San Diego County area.
For more information, check out my YouTube Channel playlist on relocation tips and advice, a series of 19 short videos about the things you should know when relocating.
While any move is going to cost, a major move, say across the country, will likely come with some expenses you aren’t thinking about or planning for, especially if you have not made a big move before.
This post is for those of you who are not making a move with a relocation package from your employer. We’ll talk about relocating with a corporate relocation package in another article.
NEW TAX LAWS FOR 2018
First, the new tax laws for 2018 made a number of changes, including a change from being able to deduct moving expenses as you could in the past.
Here’s a quick note from H&R Block about this issue, but I advise talking with your CPA to find out the situation (I am not an accountant and can’t provide tax advice) and how the tax laws affect you.
That said, you certainly want to track your expenses so you know the impact on your budget, especially if you are racking up those credit cards due to your relocation and not paying attention.
So here are the primary areas that could impact you financially in your relocation:
SELLING AND BUYING?
A relocation is more complicated if you are both selling your primary home and buying another. You need to consider your financial situation early on to determine if you have to sell your home in order to buy another, or if you can manage 2 mortgages, so you can plan accordingly.
There are additional costs, of course, for maintaining 2 households – the loan, taxes, insurance, and utilities.
You should talk with a lender early on to look at your options for selling and buying, and to get pre-approved for your purchase in your new location so you know what you can afford.
HOUSE HUNTING TRIPS
Unless you decide to buy your new home sight-unseen, you will likely make at least one trip to look at homes with your Realtor, perhaps several. Consider:
- roundtrip costs of the trip, e.g., air fare OR
- driving expenses if you have the time to drive or distance is not great
- hotels and food while traveling to and from your destination
- food and accommodations while on your house hunting trip
- car rental
- do you need to board a pet while away or have a house sitter?
COST OF MOVING YOUR HOUSEHOLD GOODS
There’s no doubt using a moving company will cost, and in my experience they can vary quite a bit in terms of costs depending on the specific services, the insurance (check to see if your homeowner’s insurance will cover you in a move), and even what you need to move (cars, specialty items such as a boat or motorcycle, antiques, art work).
Another option to consider, depending on how much stuff you have, are moving companies like PODS which are a less expensive option.
Consider these costs:
- the physical move itself – may be determined by weight and distance
- any packing you have the movers do (unless you do it all yourself)
- packing supplies (check to see what they cost with the mover vs. some other supplier)
- unpacking by movers or others
- the cost of a shuttle truck (for example if you live up a long narrow or steep road a big van cannot navigate you will probably need to pay additional fees for a shuttle van like my Mom did).
Here are some key questions to ask your movers (when interviewing movers I strongly recommend getting at least 2 estimates).
Depending on your personal situation you may need temporary housing during your relocation.
- You may need to move out of your primary home that you just sold before moving into a new property
- You might have a hard time finding that new home and need temporary housing until you find it
You should do some planning on this issue if you think it’s a possibility so you have a plan in place if needed. Temporary housing can get pretty expensive, especially if the option you elect is a hotel as opposed to an apartment or rental condo.
An extended stay hotel (e.g., Extended Stay America, Choice Hotels, Residence Inn) will likely be far less expensive than a regular hotel if you need accommodations for more than just a few days. You may pay extra for a pet, too
Again depending on the situation when coordinating a sale and a purchase in a new location you might need to store some or all of your household goods, either at your old location or the new one. If you use a moving company they may provide storage for a period of time so check on that, and the cost and any time limitations.
You may need to arrange for a storage facility so check on that before you need it. These facilities typically offer different sized storage areas and the costs of course vary. This could also include storage of a car. You’ll want to ask out about any contract, or it may be month by month, as well as any required deposit.
If you have any questions, please don’t hesitate to ask – I’ve done this a bunch of times myself and am happy to help you relocate here to Carlsbad or nearby. Please call me at (760) 840-1360 so we can discuss your relocation, housing needs, and timing. It’s never too early to start planning.
NEXT STEPS TO TAKE:
You can start your search for a new home in the Carlsbad area by clicking on the photo to the right. Or give me a call and I can create a custom home search list for you!
If you need help selling your home in your current location I can assist you in finding the right Realtor in your local market, given my vast professional network of great agents around the country.