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Old 08-15-2012, 07:46 AM
 
48 posts, read 79,213 times
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Hello all,

My question is whether a single person could live in Fairbanks on 55k a year? Would this be a comfortable salary for the area? I know it wouldn't be considered wealthy by any stretch, but is it enough to live "comfortably"? Enough for a small house/decent apartment, utilities, car payment ($500 or so a month), groceries, a little spending money, pets, cell phone, internet, cable, etc.? I would only need a small living space (700-1000sqft), but I would like it to be clean. I know heating fuel is a big cost in the winter, but I think I would likely be able to get by keeping the temp between 60-65F.

Thanks for any input. All would be appreciated.
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Old 08-15-2012, 11:08 AM
 
Location: Fairbanks, AK
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For that amount, a single person could live very comfortably here in Fairbanks.
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Old 08-15-2012, 11:22 AM
 
48 posts, read 79,213 times
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Quote:
Originally Posted by 1stimestar View Post
For that amount, a single person could live very comfortably here in Fairbanks.
Really?? That's very exciting! Everything I've been able to find has had me kind of worried, but admittedly there seemed to be quite a bit of discrepencies so that's why I was hoping to get some more feedback from people who live in Fairbanks or the surrounding areas.

Would you recommend house or apartment? I've read that the housing situation is pretty tough up there right now. I prefer house since I know that I'll eventually have big dogs again, but I'm trying to be realistic about what I could afford with that salary.

Thank you for the response!
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Old 08-15-2012, 12:20 PM
 
52 posts, read 76,815 times
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Quote:
Originally Posted by 1stimestar View Post
For that amount, a single person could live very comfortably here in Fairbanks.

I differ from this opinion. Reason being is that you have a $500/month car payment. In addition you're wanting pets, cable, internet, cell phone, and your own place (electricity, oil)? Those additional costs will definitely eat into your 55k. Do you buy clothes at a retail store or at a thrift store? These small necessities cost much more than the lower 48.

If you don't want to post to the thread for us to give an opinion on, compare to yourself how you're living now in the area you live and the salary you make. Are you living comfortably in a lower cost area? Are you debt free?

I'm not trying to scare you here! Just being realistic. If you like to socialize and go out to dinner/drinks/movies, those add up pretty quick as well. This is because the prices of food/beverage are considerably more than the lower 48. I choked the first time I saw the price of a meal at Wendy's!

Here's the ideal situation I would recommend (knowing full well this is in a perfect situation):
1) Sell your car (don't trade it in!) for close to what you owe (here's hoping you're not completely upside down).
2) If you have the cash- buy a good deal around $5k once you arrive in Fairbanks. Most times you can get something already winterized with the snow tires.
3) Find a rooming situation where you either share a 2 bedroom or you rent a room in a home. Hopefully the latter will provide the cable/internet in the rent. Try to pick a place where heat was included! (I paid $125 for a stupid landline and internet. I pay that now in the lower 48 for phone, faster internet, and a large cable package.)
4) Buy all your gear/furniture second hand once you arrive. Scour craigslist, garage sales and the thrift stores. This will save you tons (yes tons) of money from the beginning.
5) Forget the pet.


Good Luck
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Old 08-15-2012, 12:36 PM
 
48 posts, read 79,213 times
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Quote:
Originally Posted by DrRuthie View Post
I differ from this opinion. Reason being is that you have a $500/month car payment. In addition you're wanting pets, cable, internet, cell phone, and your own place (electricity, oil)? Those additional costs will definitely eat into your 55k. Do you buy clothes at a retail store or at a thrift store? These small necessities cost much more than the lower 48.

If you don't want to post to the thread for us to give an opinion on, compare to yourself how you're living now in the area you live and the salary you make. Are you living comfortably in a lower cost area? Are you debt free?

I'm not trying to scare you here! Just being realistic. If you like to socialize and go out to dinner/drinks/movies, those add up pretty quick as well. This is because the prices of food/beverage are considerably more than the lower 48. I choked the first time I saw the price of a meal at Wendy's!

Here's the ideal situation I would recommend (knowing full well this is in a perfect situation):
1) Sell your car (don't trade it in!) for close to what you owe (here's hoping you're not completely upside down).
2) If you have the cash- buy a good deal around $5k once you arrive in Fairbanks. Most times you can get something already winterized with the snow tires.
3) Find a rooming situation where you either share a 2 bedroom or you rent a room in a home. Hopefully the latter will provide the cable/internet in the rent. Try to pick a place where heat was included! (I paid $125 for a stupid landline and internet. I pay that now in the lower 48 for phone, faster internet, and a large cable package.)
4) Buy all your gear/furniture second hand once you arrive. Scour craigslist, garage sales and the thrift stores. This will save you tons (yes tons) of money from the beginning.
5) Forget the pet.


Good Luck
Thanks for the response. My situation as it is now looks like this:

1. New graduate with plenty of student loans needing to be repayed
2. No car payment as of yet (was planning on buying once arriving in Fairbanks)
3. Also, planned on buying new clothes once arriving once in Fairbanks (I realize I may pay more, but at least I will know they will be good clothes for the area)
4. It will just be me, but I know that eventually I will have pets
5. I prefer decent cable/satellite and internet

I will be flown up for an interview and if offered the job could have a place to stay rent free for 3 months. This will give me a little time to build up some money and buy some of my essentials (car, clothes, etc). Including student loans, my bills in the next few months will amount to around $800 a month. That will be my only financial responsibility before applying mortgage/rent, utilities, car payment, insurance, etc.

Does 55K sound like enough given the cost of living in Fairbanks or nearby areas?

Thanks again for the reply.
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Old 08-15-2012, 03:45 PM
 
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I am assuming that this in an entry level job with room for salary improvement?

Student loans usually have low (although long term) payments.

55k/yr. will probably turn out to be around $3500 a month in usuable cash after payroll deductions/taxes. Someone here could porbably get that ballpark figure alot closer to actual. IIRC, Alaska is not part of Federal Social Security, but you still have to pay into the Alaskan retirement system.

You may need to tweak these amounts, but here is my budgeting thought process for my family. I modified it as if it was just me and getting your job:

Starting with $3500 a month:


$xxx - Studen Loan payment per month?
$500 - Vehicle Payment (does this include Car Insurance?)
$320 - Fuel for Vehicle. (I don't know what vehicle or how far from work you are planning on living) Figure is based on 15k miles per year, 18 mpg, and fuel at $4.50 per gal)
$250 - For eating lunch out at work at just over $10 a working day. (Fast Food Lunch-especially in AK where a $5 subway footlong costs $9.75)
$500 - Breakfast / Lunch. This ONLY gives you $15/day for these two meals.
$100 - Housing Incidentals and consummables. (i.e. Cleaners, Toilet Paper, light bulbs, etc...)
$125 - Cell Phone (unless you can get by with a limited phone, I like my iPhone)
--------
$1825 (not including your unknown student loan payment)

This leaves $1675 a month for RENT, Cable, home Phone, Internet, Heating fuel (wood/oil/gas), water, electricity, 'play' money, and dare I say savings. Put a small amount at first $50 - $100 a month - into a savings account of some sort. (regular savings, 401k (IRA), money management, whatever floats your boat - BUT DO IT and start it NOW and when you get a raise split the raise with the account.)

I think that you may need to cut back on the vehicle expectation at first... And you may be able to eat cheaper than what I budgeted you for.. I think I am missing some bills still as well... Ohh, this doesn't count the money you will need to have to get all of the nice cold weather stuff you need either. So you either need to have a chunk of cash on hand or prepare to 'charge it' and pay it off.
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Old 08-15-2012, 03:54 PM
 
48 posts, read 79,213 times
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Thanks Dakster! Very helpful and insightful post. I appreciate the thoughts.

Do you think a small house (1000sqft or so) or an apartment would be the better option financially? I know that some apartments have utilities included, but that brings up another question: can you tell me any nice/clean apartments in Fairbanks? I will be there in a couple weeks so luckily I'll get to look around. If you have any ideas please let me know. The only other problem with getting an apartment is I know I would eventually have to get a house, because I'm a big dog person and eventually will have some more four legged companions and most apartments frown upon big dogs.

Thanks again for your help!
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Old 08-15-2012, 04:45 PM
 
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I just visited and do not live there so I can't help with the local stuff. Although no matter where I am, I am not an apartment living type person. I have lived in them and I do not care for it...

I am animal person and couldn't see owning anything but a house with land around it. (no townhouses eitther) I would take advantage of the three months of 'free' rent to look around and explore. Talk to some realtors (Marty Van Deist here is a great resource, although I am not sure he works in Fairbanks.)

BTW, I highly recommend saving your anticipated 'rent' payment each of those three months. First, it will get you ready for that payment, second, you will save up your first, last, security payment for rent -or- even better, may be able to use it as down payment to buy something.

I always like owning than renting, although there are pros and cons to both that apply anywhere you may live. As a suggestion, assuming you are a DIYer, you might be able to find a good deal on a foreclosure or fixer-upper that doesn't require the usual 20%-30% down to get the loan... A visit with a local realtor can help you with that - Be careful with what you have to fix, I noticed that it isn't only the food and fuel that are more expensive that what we are used to, living down here. The same proverb applies, if it sounds too good to be true it usually is.

Nice thing about owning is that eventually the payments stop and even in a flat market you are still building equity. You have ALOT to look at, learn, and decide about. And even though 3 months goes by fast, it should be enough time to figure it out on your days off.

Even though you can learn and research a lot on the internet and ask questions on the forum here, it still doesn't totally prepare you for what you will experience when you get there.
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Old 08-15-2012, 06:42 PM
 
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Again, I thank you very much for the input, Dakster. You have been extrememly helpful. I'm definitely more of a house person than an apartment person. Of course, I would live in an apartment if that was my only viable option. I'm definitely looking forward to the visit to Fairbanks so I can see it first hand. Nervous, but excited. Not sure what will come from it, but I'd like to be as prepared as possible. You've definitely helped in that regard. Much appreciated.
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Old 08-15-2012, 09:36 PM
 
Location: interior Alaska
6,002 posts, read 4,370,046 times
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Plenty of people support a family in the area on less. But 55k will not go as far in Fairbanks as it will elsewhere. You will have to be frugal if you don't want to be broke all the time. For starters I would not spend $500 for a car payment. I have a pretty nice 4WD SUV and I pay way less than that! Cable is a luxury...that's a lot of money to pay to sit on the sofa while corporations advertise at you. Ray's bourgeois American notions of housing notwithstanding, 1000 square feet is pretty dang big for a one-person residence and will be expensive to heat...keeping the heat at 65 degrees is not a great money saver when it is 50 below. You are warming all that space over 100 degrees! And if you have plumbing you can't turn the heat down much more than that or the pipes will freeze and you will have an even more spendy problem to deal with. So smaller is better; smaller spaces are much less expensive to heat. Etc.

Basically I would say yes, you can live comfortably on 55k, but you need to think about what is really needed versus what is wanted just because it is a norm. Making some lifestyle changes will free up money for hobbies, travel, etc.
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