Whether you're relocating for a new job, moving closer to family, or just seeking a higher quality of life, packing up your life is a massive undertaking. It's completely normal to feel a mix of excitement and stress, but proactively planning for this new chapter can give you the clarity and confidence you need to enjoy the journey.
Three moves to get started
Understand the emotional impact
Moving is one of the most stressful things in our lives, ranking right up there with money issues and even divorce. Chances are you'll experience some level of anxiety. Knowing this in advance can help you remain calm and avoid making ill-informed decisions. One of the best ways to reduce that anxiety is to get financially organized before the packing tape comes out.
Get financially organized
Proactive organization helps you see exactly what you need to keep track of and what information needs updating. If you wait until after the boxes are unpacked, you might find yourself overwhelmed by a never-ending to-do list. Getting ahead of the paperwork now allows you to focus on the adventure later.
Plan for moving costs
Don't forget to estimate and plan for the physical cost of the move itself. Your budget will vary based on whether you choose a DIY approach or hire professional movers, but creating a rough estimate helps you avoid arriving in your new town with less cash than expected. Be sure to budget for storage and transportation costs depending on the length of your trip. Moving can easily cost $5,000 or $10,000, if not more.
Finding a place to call home
Selling your current home
If you're selling a home as part of the move, it's important to work with a real estate agent to navigate the complexities of the transaction. The timing of the sale can impact your cash on hand, your ability to purchase a new property, and your monthly cash flow. While an overlap in monthly payments between your old and new residence is normal, you should account for these extra expenses and plan for a little extra wiggle room.
Buying vs. renting
Whether you're buying or renting, get a clear sense of costs and what you can afford. A change in housing costs will have a significant impact on your budget. Even if you own a home now and plan to buy in the new area, it might be smarter to rent initially. This gives you time to understand the neighborhoods, school systems, and culture of the area.
This approach might mean moving twice, but it could help you avoid a decision you regret later. Renting offers flexibility and more time to prepare for the costs of homeownership. There's no right or wrong answer here, but doing your research helps you make a smart decision.
Child care and education
For current or expecting parents, researching child care options, costs, and quality may be critical to choosing a location. A good starting point is GreatSchools.org for reviews of local schools. It's also a smart idea to research neighborhoods before you move. You can find extensive reports on neighborhoods at NeighborhoodScout.com.
Job and career opportunities
Moving has less of an impact on careers now that more people work remotely, but it's still important to understand the strength of the local job market. This is especially true if you are moving as a couple and one partner needs to find a new role.
If you're moving for work, be aware that federal tax deductions for moving and job-hunting expenses are currently suspended for most taxpayers. It's important to work with a tax professional or CPA to understand current tax laws and how your move impacts your overall tax picture.
The rest of your financial landscape
Cost of living
One big factor is a change in the cost of living. Imagine moving from Topeka, Kansas to San Francisco, California. The sticker shock would be overwhelming. Before making a move, use online calculators to get a general sense of what your new cost of living will look like. Just remember that your personal circumstances and lifestyle will play a major role in the final numbers.
Taxes
State taxes are often overlooked. All states have different rules and regulations. Nine states have no income tax, while five have no sales tax. Some use flat tax rates, while others have a progressive tax structure where rates change as income rises. They also vary in how they tax pensions and Social Security income.
However, living in a state with no income tax doesn't always mean you're getting a free lunch. You have to look at other areas, like property and real estate taxes, to get the full picture. Do your homework to understand what you will owe and how to pay it. If you have state income taxes, remember to update your tax withholdings through work to avoid a big tax payment when you file your returns.
Auto and home insurance
Insurance costs to protect your home and vehicle will vary widely depending on where you live. For example, living in Florida on the water will be more expensive than living in Western Maryland. If you plan to stick with your existing insurer, they can tell you what your new rates will be when you move.
Health insurance
If you work for a larger employer, your health insurance will likely be uninterrupted by your move, but you do need to check local providers to ensure they are in-network. If you are self-employed or have a health care exchange policy, you will likely have to look for a new policy. Research the insurance exchange in your new state before you move to see your options, and contact your provider to ensure seamless coverage.
Estate planning
Estate planning laws and taxes also vary widely. When you move to a new state, you should plan to update all of your estate planning documents, including your will, financial power of attorney, and health care power of attorney.
For married couples, different states treat the things you own, such as your homes, cars, and investments, differently. Understanding how you own your assets, like whose names are on a deed or bank account, is critical. It impacts legal ownership, property rights, tax consequences, and creditor protection. Getting this right helps avoid costly estate planning mistakes.
What to update after the move
Once you're ready to enjoy your new city, it's important to update your official documentation. This includes:
- Change of address and voter registration information
- Personal profile information with your employer (if staying with the same company)
- Car title and driver's license
- Bank, credit, and investment account information
- Insurance policies
Some processes, such as registering a vehicle, have strict deadlines. Avoiding a delay can save you a lot of issues down the road.
The Facet difference
A move is seen as a physical relocation, but it has a very real impact on your entire life today and for years to come. At Facet, we believe financial planning is about more than just investment accounts; it's about helping you navigate life's biggest transitions with confidence. Our membership-based model gives you access to a CFP® professional who can help you understand the impact of an out-of-state move and create a proactive roadmap to make it possible.
We don't just look at the numbers. We look at the life you want to build in your new community. By offering objective advice and a transparent flat fee, we help you settle in and thrive without the worry of unexpected advisory fees or sales commissions.
