Cheap Places to Live: David Savageau
Interview

From LoveToKnow Save

As the economy continues to fluctuate, you might be considering cheap places to live as a way to gain control of your future.

Author David Savageau

There are a number of factors to evaluate when choosing a new location. A helpful guide to the process is David Savageau, author of The Places Rated Almanac, Retirement Places Rated, and World Retirement Places Rated. Through these books and his site, Places Rated, you’ll have access to facts presented in an easy-to-understand format.

During his career at Time Warner, Savageau traveled all over the U.S. For five years, he and his wife Karyl learned about the country through the windows of an Airstream camper. He currently lives in Washington, D.C.

LoveToKnow Save recently asked Savageau for his tips on selecting affordable places to live.

Finding Cheap Places to Live: David Savageau Interview

Please give us some basic parameters used to evaluate cheap places to live.

Most cost-of-living sources give you indexes against a national average of 100 in the major household expense categories. So, for instance, if San Francisco's "housing" index is 275 and its "transportation" index is 119, then one could say housing expenses in San Francisco are 175 percent greater than the country at large, and transportation expenses are 19 percent greater.

Yes, there are differences between these major categories:

  • Housing
  • Health care
  • Recreation
  • Transportation
  • Food
  • Taxes
  • Miscellaneous items

But if you focus one just two of them – housing and taxes – you'll capture about 80 percent of the cost difference between any two areas. That's a short cut – ignore things like food and health care and just laser in on the costs of buying a home and keeping it going plus state income and sales taxes.

What states are generally more affordable to live in and why?

  • Income tax free states:
    • Nevada
    • Florida
    • Texas
  • Income tax states with low living costs:
    • Alabama
    • Arkansas
    • Louisiana
    • Mississippi
    • Oklahoma
    • Generally the inner South and the central Southwest

Knowing What to Evaluate

What are some of the criteria people forget to include in their analysis or comparison that contribute greatly to the final decision?

  • Public college tuition. In some states like California, Texas, and New York, it’s very reasonable.
  • Auto insurance and auto excise taxes.
  • Difficulty in finding primary physicians – especially pediatricians – in fast-growing areas.

Please list five places in the U.S. that are surprisingly affordable.

Here are 10:

  1. Alamogordo, NM
  2. Alpine-Big Bend, TX
  3. Brownsville, TX
  4. Cedar Creek Lake, TX
  5. Lake of the Cherokees, OK
  6. McAllen-Alamo, TX
  7. Natchitoches, LA
  8. Roswell, NM
  9. Silver City, NM
  10. Thomasville, GA

These locations rank high across the board in strengths such as ambiance, low costs of living, low crime, mild climate, good job prospects, services, and housing choices.

On your site Places Rated.com, there's a list of the Top 10 overall locations. What factors ranked them that high?

Those locations are for people considering retirement:

  1. Georgetown, TX
  2. St. George-Zion, UT
  3. Fort Collins-Loveland, CO
  4. Charleston, SC
  5. Henderson, NV
  6. Kalispell-Flathead Valley, MT
  7. Fairhope-Gulf Shores, AL
  8. Scottsdale, AZ
  9. Laguna Beach-Dana Point, CA
  10. Sarasota, FL

These spots benefited from mild winter climates (except for Fort Collins and for Kalispell), good job prospects, low living costs (except for Laguna Beach and Scottsdale) and splendid outdoor recreation endowments.

Living Where the Jobs Are

A major concern right now is living somewhere with strong employment opportunities. Are these locations only in big cities, or are there some other areas of the U.S. that offer solid employment potential?

I would have to say at this point in our shrinking economy with no end in sight, metro areas with a population greater than 250,000 and fewer than 1 million throughout the city and suburbs.

As a general rule, smaller areas aren't good job-searching grounds for the most high-paying occupations in the most high-paying industries. Some metro areas greater than 1 million are slumping, while others offer higher paying occupations and industries than small metros but are expensive places to live.

In general, the South and West are still projected to grow economically, in spite of the temporary slowdown.

What other suggestions do you have for individuals hoping to relocate to a less-expensive area?

  • High oil prices can easily come back. Choose a location within your new city with easy access to employers, school, and shopping so you're not spending so much on gas. Don't be caught way out in the boondocks. Choose, if possible, a combination of natural gas and electricity utilities for your house.
  • Most areas of the country are still working their way through the foreclosure crisis. Try to find an attractive investor-owned house to rent while you learn the lay of the land. Rents are reasonable now. Renting when you first settle in gives you valuable knowledge and power over the real estate market.
  • Before you move, so some extreme housecleaning. In no other moment in life are you allowed to get rid of so much. The question should be, “Would I buy this if I didn’t have it?” If there is any doubt, toss.

More Information

To start your search for cheap places to live, try these resources:

~Tracey L. Kelley

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