California is notoriously expensive. And, to be specific, let’s assume I am referring to the areas that are more expensive like San Diego, LA, or San Francisco, and not, I don’t know– Modesto. In a recent study, KTLA reported that a single person needs to make at least $76,000 annually just to live comfortably in San Diego. And that’s just to live comfortably.
And if you wish to own a home in California? That’s even more expensive. Reasonably so, homeownership for people aged 25 to 75 has dropped to 43.5% in 2021, which is down from 50% in 2000. California in general already has a lower rate of homeownership than the rest of the united states.
When I decided to move to California, I knew that I would be nearly tripling my expenses, so I am approaching this with personal experience in mind. If you are looking to move out west or just want a game plan in case the day ever does come, here are some practical tips for how you can afford to live in California.
17 Way to Afford Living in California
1. Focus on the big picture
When figuring out how to afford living somewhere as expensive as California, I recommend focusing on the big picture pieces first. Cutting back on lattes and avocados can be helpful…but only by about $3 dollar each time. But finding a less expensive place to live and a lower car payment? That can save you hundreds, even thousands of dollars a month.
2. Find roommates
Of course this is on the list. But do you know why I feel like I have to mention this? It’s because we currently live in a generation with the most single households to date. Don’t let societal pressures make you feel like you have to live alone to be successful. If you need a roommate or two to afford to live in California, that’s a totally normal and respectable move to make. Especially if it means that you will still have enough funds at the end of each month to do things like invest and pay off debt.
3. Don’t move to a large city
At least, not at first. If you aren’t totally settled on where you want to live, or you know where you want to live but you can’t afford it yet, moving to one of the lesser-known areas of California might help you get your foot in the door.
4. Sell your car
Depending on where you are relocating to, you might be able to sell your car. Public transportation, biking, or walking might all be a possibility in this sunshine state. Cars can add so much to your monthly expenses, between car payments, insurance, maintenance, gas, and more, it’s not unusual for a person to pay over $500 a month on their car expenses. This could be a temporary (or long-term) solution to afford to live in the place of your dreams
5. Relocation benefits
If you are transferring with a company for work, don’t forget to get your relocation benefits! Not only do most companies provide financial assistance for the cost of moving, but you should also ensure your pay is getting the increase it deserves. What might seem like a big pay bump in one state, could actually not be a pay increase at all once you are paying California prices.
6. Work from home
Traveling to and from work can add up, especially with California traffic! Not having to commute can save you in monthly car expenses and some remote work might come with other benefits like the company paying for your internet or part of your electricity bills.
7. Secondhand shopping
Some of the best secondhand and vintage stores I have ever found were in LA! These stores can be a treasure trove of vintage or designer pieces, at a fraction of the cost. Of course, it can be easy to get caught up in a vicious cycle of “it’s only $20!” until you are completely broke, but if you go in with a game plan and stick to it, this can be a great way to save on your usual expenses.
8. Get a side hustle
I can hear the eye rolls now, but if you are serious about wanting to live in California and you can’t afford it comfortably on your current salary, a side hustle might be the best way for you to achieve your dream. Now, I am a pretty firm believer that side hustles should only be for a period of time. You should be working two jobs for 40+ years, it’s just to sustainable (or enjoyable). But if you need a little extra income to get to where you want to be, check out these weekend side hustle options.
9. Increase your income
I have to mention it. Here is a reality check: you may have hit the earning cap for your career field. But it doesn’t have to be this way. You may absolutely love your job, in which case I would suggest doing your research and making sure you are being fairly compensated. But if your job is just so/so, there are plenty of career fields you can make a move into and be earning over 6-figures within the first few years. Read The Secret to Making 6-figures in Your 20s for more inspo.
10. Community resources and events
Many areas in California offer free events, free museum days, and even community performances. Not to mention tons of farmer’s markets and pop-ups.
Another wildly underused resource is a library card. Library cards not only give you access to unlimited books and audiobooks but can sometimes offer discounts or free admission to different places, so be sure to read the fine print!
11. Go outside
One of the great things about California is the incredible terrain and weather. Although your cost of living will almost certainly go up, you can likely cut back on entertainment costs as you explore your local hikes, beaches, and other natural resources.
Investing in a one-time purchase might be a smart move to give you a hobby that has little to no cost anytime you want to use it. Examples of this would be a bike, skateboard, surfboard, or other large purchases that you can use over and over again. Plus, hobbies like these might help you meet your new friends!
12. Look for local and student discounts
Because California tends to be tourist-heavy, some places like museums or restaurants offer discounts for locals and students. If you fit the bill for either of these, don’t let the savings pass you by! Even a small discount can help you save so you can spend more on the things that matter.
13. Don’t shop at Erewhon
Unless that is the whole purpose of your move to California, opting for more budget-friendly grocery store options will likely serve your wallet better. Cooking quality meals at home with organic ingredients doesn’t have to cost a fortune. There are tons of resources out there that can help you learn to cook (and grocery shop) on a budget!
14. Work out in the great outdoors
If you are used to paying for a costly gym membership every month, this might be a good time to cut back to home exercise. If your gym is super important to you, this can always be a temporary solution, but this might be a way to help lower your costs while you navigate this new cost of living. And, thankfully, you are moving somewhere where outdoor fitness is completely the norm.
Maybe you invest in a set of free weights, or maybe you let this be a time of hiking, jogging, or swimming. Whatever your fitness preferences are, the great outdoors can probably help you out.
15. Volunteer for perks
There are some volunteer positions that come with incredible perks. I’m talking about free event access, free food, and more! And in a busy place like California, there is almost always something to volunteer for. You could also take this as an opportunity to fill your time with volunteer work that matters to you. Because while you are volunteering to walk puppies, it is pretty hard to spend money you don’t have in your budget. It’s a win-win.
16. Get a credit card with cashback benefits
Now, I hesitate to suggest this because a credit card is not to be used if you don’t intend on paying it off immediately. However, if you have a good history of paying your bills on time and trust that you won’t overindulge past your spending limits once you get to the west coast, having a card with good benefits can be a game changer.
In this situation, you might want to focus specifically on cards that offer cashback, but if you are a frequent traveler, you could also investigate cards with travel perks. There are so many great options out there, you just have to decide what you need the most! Who knows, it might pay for your groceries one month or a trip back home for the holidays.
17. Learn to Budget
It’s hard to save money if you don’t know where it’s going. If you are moving to a new area, but especially somewhere as costly as California, it’s important to track where your money is going! I would recommend that at least for the first three months that you are there you track your expenses and do a monthly review. This will help you see how you are spending your money on and if there are areas you can cut back on.
For instance, you might see you are spending twice as much on eating out as you are on groceries, and maybe eating out isn’t that nice of a luxury for you. Information is knowledge and a budget is knowledge that helps you achieve your financial goals (a.k.a the best kind).
If you are new to budgeting, I have a free resource to get you started.
Wealth building tips
One of the best ways for you to afford that move to California will be by increasing your wealth. There are several ways to do this.
As mentioned earlier, increasing your income at your 9-5 is my favorite way to increase wealth. In my mind, this is step number one. It’s great to learn to save and stick to a budget, but if you are only able to save $20 a month? That’s not going to get you to your financial goals nearly as quickly as someone who is making double your income. And I assure you, there is someone making double your income.
I say that last part not to make you feel guilty about how much your earn, but because I really wish someone earlier in my life would have exposed me to how much money is out there. There is so much opportunity to increase your income! There is so much money out there in the world just waiting to be made! And there is a good chance you can find a way to do it that suits your preferences and lifestyle.
Investing is also an incredibly important part of building your wealth. There is no way I would have felt as confident in my move to California if I hadn’t already tripled my net worth. Now, that might not be necessary for everyone, but knowing that your money is growing behind your back is really comforting when you are taking calculated risks, like increasing your cost of living.
If you want to learn more about investing, I host a free, live investing class to help you build wealth on autopilot.
My final note on investing is this– if you want to build long-term wealth, don’t assume you will be just SO rich in the future that what you do now won’t matter. The earlier you start investing, the more time compound interest has to do its work. So if you move to California and you only have $15 to invest every month? It’s still absolutely worth it.
Moving to California can come with a cost of living that many will never have to experience. However, living in constant sunshine and beautiful scenery can be more than worth it. If you are hoping to afford to live in California, but aren’t sure where to start, I would recommend budgeting be your first step.
Learning to budget can help give you insight into your spending habits and how you might be able to adjust them in your new place of residence. By tracking what you spend your money on, you will have the knowledge to prepare you for how you want to tailor your life for your move and beyond.
Once you have your budget in place, focusing on the big-picture pieces of the puzzle will help you plan for your major expenses. Finding affordable housing, figuring out your commute and car expenses (or if you can sell your car), and other big bills will help you know if it is a realistic move for you or not.
Lastly, keep in mind that moving to California comes with many free or nearly free resources! Hiking, biking, swimming, exploring, free performances, and so much more await you and this can help offset the higher cost of living.
I’ll be honest with you. When I was making my move to California, I was a bit terrified. It was a big jump in my cost of living and I had to wonder if it was really worth it. But once I was here? I didn’t second guess it for a second.
Sometimes you have those desires in your heart that you just have to follow through on. If moving to California is one of them, there are absolutely ways to make it happen. But for me? It wouldn’t have been possible if I didn’t focus on growing my wealth first.
If you want more information on how to do that? I have a free class for you here.