May 18 2007
Comparing Cost of Living
Anyone looking to move to another area of the country should check out the relative cost of living before doing so. In fact, for many people, that might be one of the determining factors in whether or not a move is advisable, or even feasible. Since She and I are going to Maine, costs be damned, I thought it prudent to see how much our costs might change in doing so. There are a number of cost of living and salary calculators on the web. Here I present the results from three of these sites. The conclusion I reach from the somewhat dissimilar numbers is that our cost of living isn’t going to change much, but what little it does will be in the less expensive direction (I hope).
Source #1 - Sperling’s Best Places. Sperling’s asks that you put in your salary and your current and destination locations. For the sake of simple numbers, I told them we made $100,000 between the two of us (no, that’s not actually what we make, but it’s simpler math). Here is what I found out. According to Sperling’s, the Portland area is about 3.7% more expensive than New York’s Capital Region, our current home. Albany-Schenectady-Troy rates a 108.7 on their cost of living scale (where 100 is the national average) and Portland a 113. Ouch. Interestingly, Albany is more expensive in almost every area which Sperling’s lists, with one major exception. Food, transportation, health, and miscellaneous expenses are all more expensive here. The cost of utilities is way out of whack with the rest of the country, but is pretty much a wash. The area where Portland fares much worse than Albany is housing. Given that housing is generally everyone’s number one monthly expense, it’s not surprising that this single item would cause Portland to rate as more expensive than Albany. And the housing cost difference is not slight either–118.6 for Portland versus 84.5 for Albany. I guess the $900-1000 range we’ve been seeing for two bedroom apartments is about right.
Source #2 - CityRating.com. The CityRating.com Cost of Living calculator yields slightly different results. Again, I used Albany, NY and Portland, ME as our current and eventual locations and $100,000 as our combined annual salary. CityRating.com doesn’t give the same level of detail in its cost breakdown that Sperling’s did. The information I get is that my $100,000 only needs to be $96,249.09 in Portland. This is again almost exactly a 3.7% difference, but in the opposite direction. CityRating.com gives their cost of living in terms of CPI, but does not give it in individual categories. According to this site, Portland and Albany have an identical CPI of 181.8, which is a full 8 points higher than the national average. Strange, then, that it tells me we don’t need to make as much money.
Source #3 - Salary.com. Salary.com’s Cost-of-Living Wizard asks for your current salary, where you currently live and work (two separate input fields), and where you’re moving to (again, separate fields for home and work locations). Based on this information, the Wizard gives you a comparison of your cost of living and how much you can expect to be paid in your new work location. According to Salary.com, housing in Portland is 12.6% cheaper than Albany, but I can expect to make about 3.5% less in salary. I certainly find the idea of an increase in disposable income, which Salary.com reports at just over $9,000 (again, on a fictitious $100,000 annual salary), a pleasant one. Let’s just hope that it’s actually true.
So, looking at the above sources, which one(s) do I believe? I’m not sure any of them have the whole equation down, but it’s good for initial comparison and budgeting purposes at least. As Sperling’s listed the cost of housing in Portland as significantly higher than in Albany and Salary.com reports it as significantly less, I’m not sure which way to look at this data. All three of the sites seem to agree on Portland and Albany both being costlier than the national average, but that housing is the only real differentiator between the two locations. Given what we’re seeing on Rent.com and Craig’s List for apartment prices, I have a feeling that Sperling’s Best Places may paint the most accurate picture. Google’s page ranking for Cost of Living calculators seems to agree.