Although the math behind this principle is relatively straightforward, it can be hard to put into practice. There is no one-size-fits all approach to geographic arbitrage—but there are five key pillars to plotting a big move and pulling it off successfully. After all, packing up for a new place has its own inconveniences and financial outlays. The only way to know if a move will be worthwhile is to grow the gap between your recurring expenses and your income. When you can’t get any more frugal or there are no new ways to stretch a dollar, then follow your budget to your next destination. Can you reduce the cost of transportation? Will childcare expenses drop? Does the job market command a higher salary? Are sales taxes lower? You see where this is going. Line item by line item, use sites such as Bestplaces.net, Numbeo.com, and Expatistan.com to compare your current expenses to projected prices elsewhere. Sometimes the move can be as simple as going from San Francisco to Oakland or from Miami to Fort Lauderdale. Even small shifts can spell sizable savings. For those looking further afield, don’t let the lure of an exotic adventure side-track your savings: Only pack your bags if the numbers shake out. And once you’re settled in your new digs, don’t spend all your loot trying new restaurants or splurging on fancy furniture. Stick to the plan and prioritize those original financial goals. Based on personal preferences and life goals, each person has to decide how long they’ll stay and how far they’ll go. Check sites like talesmag.com for inspiration and insights from people who have already done it. Stay creative about what might work for you and your family—and be open to unexpected possibilities. A little bit of imagination could go along way. If this move will usher in a career change, apply for preferred roles and secure your spot before you move. Gone are the days when you have to interview face-to-face for everything. Now, it is normal to job-hunt from afar with the promise of a move farther down the road. Some employers will even pay for relocation. But do all your homework on employment prospects and put your name in the hat well before you pack your bags. Lastly, freelancers: You already have a lot of location flexibility, but beware of tax implications that could undermine take-home profits. Ask a tax advisor what income and sales taxes might affect your bottom line. Consult with experts and be strategic about increasing your earnings and solidifying streams of income. If you move overseas, keep a United States phone number (GoogleVoice or Vonage are good options) just in case a high-paying remote work opportunity pops up after you’ve moved to Bali or Bangalore. Even if the transfer is just across state lines, you might want to hang on to your number with that old area code. It might send the right signal to hiring managers in your old neighborhood who might be looking for virtual workers with your credentials. Have a trusted person handle your mail, so you won’t miss out on reimbursements, bills, and special offers that could affect your spending plan. No matter which destination promises big savings, if your relocation is longer than a day trip away from the ones you love, build an annual visit home into your budget. You’d be surprised how many weddings, birthdays, and anniversaries pop up after your departure—but none of those events (or costs) should come as a surprise. Make travel home a predictable part of your relocation plan. Keep your bank account and your options open, but don’t lose touch with the people and communities you leave behind.
