Relocating is an exciting opportunity to move up in your career, make new friends, and experience different cultures. The world is literally at your fingertips if you’re willing to relocate, but the move can be tough if you’re not prepared. Align your relocation dreams and your finances with these four tips.
Compare Living Expenses
The cost of living can vary widely from one location to another, so you’ll want to take that into consideration when you’re relocated. If you’re moving from a city to a small town, your dollars will go farther. If you’re moving to a larger city, expect to pay more for rent, utilities, and even groceries.
Online cost of living calculators like this one can help you compare the cost of living between your current and new locations. For example, a salary of $75,000 in Cleveland would equal a salary of $165,000 in Manhattan. “Use your calculations to determine whether you can at least match your current standard of living with your new salary,” recommends Jean Folger, “and what sort of relocation benefits can help beyond the initial cost of the move.”
Use Social Media
As companies relocate millennials, the role of social media in the moving process becomes more evident. Finding work for a spouse, making new friends, and even connecting kids to a playgroup can all be done through social media to help the new place feel like home. “Connecting faster with co-workers, and/or the ability to meet people before relocating to a new country will have a positive impact,” Michelle Sandlin writes. “By embracing social media, the relocation industry can help transferees learn more about their new location, meet people with similar hobbies, or just feel more welcomed, and thus have fewer failed assignments, which could save companies millions per year.”
Take Advantage of Tax Deductions
Uncle Sam can help pay for the cost of your relocation via tax deductions. If you make a work-related move to a job that is more than 50 miles from your current home, you can write off the cost of your move when you file your federal taxes. You must, however, work full-time for at least 39 weeks during year after you move or you won’t qualify. “And while you have to use the long Form 1040 to claim the moving costs, you don’t have to itemize any other deductions. The costs are detailed on Form 3903 and the total transferred to the adjustments to income section of your return,” Kay Bell advises. “There is no Schedule A to complete, no percentage-of-income thresholds to meet and no tax-deduction phaseouts because you made too much money. All you need to do is keep track of your moving receipts and mileage.”
Ask for Relocation Assistance
Companies that ask you to relocate often have relocation services available. For some companies, a standard package is provided; other companies are flexible depending on the specific needs of the employee. The best way to find out what’s available is to ask your Human Resources department. “Make sure you take the time to learn what’s available to you—and use it,” Forbes.com recommends. “For example, some companies will pay for things like house hunting trips, transportation of your cars, assistance in selling or buying your home, help figuring out how to rent out a property, and event organizers to settle you into your new home. They might also be able to help your spouse with job placement or employment leads in your new city.”