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Old 05-10-2011, 01:17 PM
 
Location: West Orange, NJ
12,546 posts, read 21,395,557 times
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i find that the competiveness of many high-cost areas helps drive down the price of a lot of quality services. this is often true of restaurants, bars, delis, etc. also, for instance, i can have a CPA do my taxes in NYC area for less than in northeast PA - because there are tons of CPAs competing for business. some things are more expensive, some things are less. i also feel like i often get exposed to a lot more clothing on sale, warehouse sales, sample sales, etc.

and craigslist in the NY Metro area? a gold mine. i bought a lawn mower that the guy said he used 4 or 5 times. it looked brand new. it was 1/3 of the price of a new one. bought his weed-whacker also for 50% of the new price. you can find high quality furniture on craigslist in abundance. sports tickets. broadway tickets. so much to do, easy to find a cheap way to do it.

you can't avoid the cost of home/rent unless you do a large share amongst people...but you can do that too if you'd like.

i find that sometimes i find some great deals on products that my parents often get stuck paying more for, because they only have a few places they can buy it from.

so....i guess i'm saying...cities often aren't as expensive as they appear.
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Old 05-10-2011, 08:26 PM
 
Location: Conejo Valley, CA
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Quote:
Originally Posted by bradykp View Post
you can't avoid the cost of home/rent unless you do a large share amongst people...but you can do that too if you'd like.
Sharing among people does not avoid high rental/ownership costs, after all its a lot more expensive to rent a room in say NYC than it is in the middle of no where. But it does minimize your exposure to the high housing costs, renting a room provides one with perhaps the least exposure. Next would be studio apartments, 1-bedroom apartments and so on.

Regardless, yeah, I live in a high cost area but my exposure to it is fairly limited because I rent a small place. Its funny too, tons of million+ homes around me. I imagine my housing costs are a small fraction of what most people are paying. But, like many high cost areas, there are tons of things to do here so I'm not sure what I'd do with a big place anyways. Clean it? Cut the grass? Sounds boring...I'd rather go out.

In reality, homes are just a sort of status symbol. Most people don't even use the space they have, they just collect junk in it.
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Old 05-10-2011, 10:40 PM
 
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I live in a high COL area. Small apartments are easily $1K and up if you want to be near public transport. Less if you live suburban but you have to have a car. (Then again, I realized at age 23 that I had to live alone and did not want to share housing- always an expensive preference).
I agree that home ownership isn't a be-all/end-all, but if rents keep going up in your area and you plan to stay in that area because you really like it, renting/sharing could lose its appeal.
I certainly agree that no one should make a financial decision based on status or what others think. Heavens, do people really do that?
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Old 05-10-2011, 10:54 PM
 
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Originally Posted by jtur88 View Post
That cuts both ways. Which is why so many ordinary people in the third world are "richer" than Americans.
Definitely. I've seen this first hand in 3rd World countries. Less need for a car because the bus/mass transit goes everywhere and most people use it, so it's convenient. Since none of your friends or family have expensive electronics, cars, and don't take out huge loans to buy homes, you don't do it either. The focus in Latin America is just on hanging out with friends & family. In the US, going out with friends on weekends often means blowing a lot of money at bars / restaurants / local attractions.
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Old 05-10-2011, 11:02 PM
 
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Originally Posted by brightdoglover View Post
.I certainly agree that no one should make a financial decision based on status or what others think. Heavens, do people really do that?
Heack, yeah people do that. That's why 2/3 of Americans live payday to payday or are going further in debt. I don't think it's a conscious decision as in "I wonder what other people think I should do". It's more of an unconscious thing about doing what other people in your perceived peer group are doing. If people were more thoughtful and conscious of what they were doing, they would generally spend less money and save more.
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Old 05-10-2011, 11:34 PM
 
Location: Conejo Valley, CA
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Originally Posted by mysticaltyger View Post
The focus in Latin America is just on hanging out with friends & family. In the US, going out with friends on weekends often means blowing a lot of money at bars / restaurants / local attractions.
On the weekends I always find it amusing that its the "Latin" families that are at the park having barbecues with their families while the other people are at the mall, movies etc. They seem a lot happier doing their essentially free activities when compared to many others...
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Old 05-11-2011, 01:21 AM
 
483 posts, read 1,559,279 times
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Frugality is relative. Someone who makes $400k per year after taxes and spends $100k of it, is frugal to me. But someone who makes $75k after taxes and spends $70k of it even though they could live on $40k, isn't frugal.

By this measure I think a lot of homeowners in expensive areas are frugal. That's how they were able to buy their house. And note I said "homeowners", because renters in those places probably aren't too frugal; they just want to live in a high-status neighborhood instead of living in a cheaper place while saving money. Ie., they want it all now instead of later.
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Old 05-11-2011, 07:22 AM
 
Location: West Orange, NJ
12,546 posts, read 21,395,557 times
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Quote:
Originally Posted by user_id View Post
Sharing among people does not avoid high rental/ownership costs, after all its a lot more expensive to rent a room in say NYC than it is in the middle of no where. But it does minimize your exposure to the high housing costs, renting a room provides one with perhaps the least exposure. Next would be studio apartments, 1-bedroom apartments and so on.

Regardless, yeah, I live in a high cost area but my exposure to it is fairly limited because I rent a small place. Its funny too, tons of million+ homes around me. I imagine my housing costs are a small fraction of what most people are paying. But, like many high cost areas, there are tons of things to do here so I'm not sure what I'd do with a big place anyways. Clean it? Cut the grass? Sounds boring...I'd rather go out.

In reality, homes are just a sort of status symbol. Most people don't even use the space they have, they just collect junk in it.
yeah, i agree. that's what i was trying to say. choosing smaller options (room share) is gonna net you the most bang for your buck. i the ny city area, if you look at a lot of rental options, studios and 1bedrooms are actually quite expensive in relation to getting a 2 or 3 bedroom and splitting it 2 or 3 ways. that's how i saved a lot of money my first year working out here. instead of getting my own place, i found myself a roomate on craigslist, and saved a couple hundred a month.

and yeah - with all the things to enjoy, the more space you acquire, the more you need to maintain. i like my small(ish) house for this reason. we needed to get more space than we had, but we didn't want to buy one of those monster houses in NJ that not only cost a fortune to obtain, but cost a fortune to heat, cool, clean, etc.
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Old 05-11-2011, 07:15 PM
 
Location: Conejo Valley, CA
12,460 posts, read 20,078,663 times
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Quote:
Originally Posted by josh u View Post
By this measure I think a lot of homeowners in expensive areas are frugal. That's how they were able to buy their house. And note I said "homeowners", because renters in those places probably aren't too frugal; they just want to live in a high-status neighborhood instead of living in a cheaper place while saving money. Ie., they want it all now instead of later.
Frugality in itself isn't going to make you money and most people have expensive houses because they have expensive mortgages (unless you're talking about multi million dollar properties).

Why would the renters not be frugal? Over the last decade renting has been the cheaper option in both the west and east cost, so its now frugal to spend more money on the same thing?!
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Old 05-12-2011, 02:40 PM
 
Location: NJ
31,771 posts, read 40,672,588 times
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Originally Posted by user_id View Post
Why would the renters not be frugal? Over the last decade renting has been the cheaper option in both the west and east cost, so its now frugal to spend more money on the same thing?!
but the reality is that most renters are renting because they cant save up the money for a downpayment. its a perfectly legitimate financial decision for a frugal person, but its usually not really how it goes.
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