Debunking The Cost of Living Myth

Debunking the myth of cost of living relative to geography. Debunking claims of some places having higher or lower costs of living than others by examining geographical statistics and tendencies. This is not a political video designed to push an agenda but rather an objective look at the issue from a nerdy geographical viewpoint.

Please note: I did not create any of the maps used in this video. They were all taken from reputable sources like the US Census Bureau, USDA, etc. I do not want to insinuate that I made the maps.

[JB-zqjx]

I grew up in Mississippi. People think I'm joking when I talk about how expensive it was to live there. Yes, rent and housing was dirt cheap in more rural or economally depressed areas (not even so much in the nicer, more suburban areas), but utilities, groceries, gasoline, insurance, and other things all seemed to cost more than they do where I live now, in suburban Missouri. And in Mississippi, the nearest employer was a Dollar General about ten miles away, providing about a dozen people with a part-time, $7.25 an hour salary. A $100k home in rural Mississippi is a mansion, it's going to just sit on the market for a year because nobody making $7 an hour can afford such an extravagant home. There were doctors, professors, successful farmers, etc. who made a decent living there (usually born into wealthy families), but by and large, most people were dirt-poor. Another factor in more rural areas is there are a lot fewer stores and less competition so prices for everyday goods and groceries tend to be higher.

[Jarekthegamingdragon]

There's one, major, big thing not being considered here. When people talk about high cost of living, they're generally referring to the cost of living raising faster than the average income. In cities like Portland and Seattle, this factor alone has pushed out most of the locals. The cost of living is also increasing far faster in these places. When I first moved into a 2 bedroom house in SE Portland 10 years ago, it was $750 a month. Within 6 years it was $1550 then I moved out. It's probably more now. AND THAT'S IN SE PORTLAND! That area used to be called felony flats. That's as cheap as you're getting in Portland proper. So yea, no. High cost of living is certainly not a myth.

[BokBarber]

One thing that's overlooked here is that most of the time, high wages in a state are usually concentrated to specific areas, but income taxes are even across the state. One example is New York. The vast majority of high wage jobs in the state are concentrated in the NYC metro area, but the rest of the state is stuck with the same high income, property and sales tax rates (yes some of these taxes are progressive and NYC has special metro taxes, but the rates are still higher than they would be for a person living elsewhere on the same income.) This means that the high tax states overburden low income portions of their state far more.

[stevewagner]

The best cost of living calculators attempt to take all of these factors and more into account. It is not a myth - it is just very complicated to allow for all the contributing factors.

[petereastwood]

12:24 “When you live in California you don’t have to run your heat or air conditioning as much ...”. Maybe in Monterey that is true. Spend some time in Fresno, or Bakersfield or Riverside and see if you will still stand by that statement.

[otiica]

My personal experience was moving from Idaho to California. My housing was more expensive in California, but every single other expense was cheaper, plus my wages doubled for a similar job. The biggest savings was on my health insurance for myself and my kids. We pay $800 less per month for health insurance in California vs Idaho. My car insurance was about half the price in California too. Definitely more than makes up for the extra $700 per month I pay in rent now Vs Idaho.

[fewworddotrick]

Great points you made here. Regardless of what state you live in, it is a fact that wages have not stayed anywhere near productivity levels in the last 60 years. I mean, there have to be hundreds of different charts and studies that prove this. All the while corporate profit climbs and climbs quarter after quarter. This is not a right wing or left wing issue- it affects us all. Corporate greed is an absolute cancer on this country.

[dalecomardelle]

I’m from Louisiana, (low cost of living] decided to move to DC [high cost of living] 5 Years ago. Everyone told me I was crazy and it was so so expensive. I got a job making twice what I was making in New Orleans doing the same work with less stress... and my dc apt was actually the same price. Once I factored in no more parking Since I no longer needed a car, I’m saving money on insurance and gas and a car note... add in the small improvements to my quality of life and can’t believe how much better things are here. The benefit of escaping the daily struggle stay stay out of poverty has been priceless.

[pgrant]

When I was in the military, I was at the same grade in California and Texas. The government paid me $2100 a month in CA for my housing, $700/month in TX. I pocketed about $600 a month in CA, nothing in TX because my electric bill skyrocketed in TX because it’s a million degrees in the summer.

[valerielhw]

Good points. Everyone and every living situation is different.

Even though a city such as Portland, OR would never be listed as a cheap retirement city, the numbers work for me because--

1) Oregon has no sales tax.

2) Portland has relatively low heating and cooling costs owing to milder-than-average weather.

3) Car-ownership is an expense that I wish to avoid in retirement. Thanks to living in a city with good mass transit services, I can.

[cookieskoon]

Groceries are... actually not the same wherever you go. It can very wildly just between cities. I also want to point out how my home state of NY has high taxes in nearly every single category youu mentioned.

[bcparanormal]

Love your channel, but when your talking at the beginning it looks like your in a hostage video. Blink three times if you get this message and need help

[kraziecatclady]

I have a house on the TN, KY border. TN has no state tax, KY has no sales tax. If I really want to save money, I could do all of my shopping in KY.

[jimanianortonified]

Yeah the biggest problem is the expense increasing faster then income. Brooklyn is really bad these days. The minimum wage finally budged from $9 to $15 since 2016. Our parents did just fine in Brooklyn with some hard work back in the day. When Mom says to me “By the time I was your age, I had a home and a half paid mortgage”, I tell her, “YEAH, TRY THAT NOW”!

[BoylenInk]

People I know who have moved south from New York are either retired or semi-retired. They buy a nice house much nicer than what they left up north - with straight cash - and still have money left over. They can have all the toys they’ve dreamed of and enjoy the more moderate winters and lower traffic congestion. It’s a pretty sweet deal for them.

One interesting aspect of this is what happened in Montana years ago when wealthy Californians started buying up ranches just because it was the cool thing to do. It drove up real estate prices so much many natives could no longer afford to live there.

[travis]

You're right that "cost of living" is much more nuanced than people think. You neglected a couple of things though: The price of energy is quite high in some states (like California). Groceries and services also tend to be more expensive in "expensive housing" areas as well because the price of labor is higher except where other factors cancel it out for certain items. Durable goods tend to be about the same price everywhere though. Wages are only higher if you're in an industry that actually pays proportionally higher wages in that area. The point is that it's highly individualistic. Some people might be better off moving to a lower cost of housing area. Some people are better off doing the opposite. I fell into the latter camp (high cost), but so far it has worked out for me. That said, I have a smaller house and yard than I would have if I lived in the south or midwest and earned half as much.

[BoylenInk]

Depending on when your house in Tennessee was built, part of your utility bill problem could be due to poor insulation. Back in the heyday of the TVA, electricity was so cheap that it made little economic sense to make houses with well insulated walls and roofs.

[Marchant]

I live in TX. The property taxes here are outrageous. The toll roads are pretty pricy, too.

[MountainDewComacho]

I moved from California to Arizona. I made less money but my standard of living went up. My commute time also went from 90 minutes to 15 minutes.

[BeLoud]

I love your "regular guy" persona, with no unnecessary glam or affectations. Just the facts, in a lighthearted way. Thanks for your hard work.