Budgetboost.co is supported by its readers. If you click on or buy something via a link on this page, we may earn a commission.

Staying on a Budget in High Cost of Living Areas

Unlike Crystal who still lives in Texas, I left the state right after college (gig ’em Aggies!) for graduate school in Pittsburgh, PA.  At the time, I thought Pittsburgh was outrageously expensive (and it was – compared to College Station!) but since moving to the DC area, I’ve learned what it really means to live in a high cost of living area.  Here is how to keep it as cheap as possible.


One advantage to living in a high cost of living area is that there are a lot of housing opportunities without owning a house.  Saving up just the down payment for a house can be daunting when an “average” house sells for half a million dollars, so everyone else rents as well. However we do still want to be invested in real estate via a combination of owning our own property and crowdfunding investments. In fact we found Realty Mogul reviews helpful in making this choice.

Renting with friends is one of the best options for housing – the more people you have sharing the cost, the less expensive it’s going to be – whether renting or mortgaging a house.  You probably shared a place with people in college.  It’s not so bad, and it can provide built-in entertainment value if you have the right roomies.  If you don’t have friends in the area, there are many services that will help you find a roommate you can live with.

Most high cost of living areas also have their flashy and very high cost areas where it’s deemed most desirable to live, and the not so flashy areas, but still decent, and less expensive.  Depending on where you are in life, you might even consider an area in the process of “gentrification” to save some cash.

There are many areas to choose from in a city, both close to and far from work – which leads to:


Almost all high cost of living areas are big metro areas – with good public transportation.  Use it.  These are the same areas where you have to rent/buy a parking spot for your car or motorcycle to live in addition to a place for you to live – adding up to more $$.  Almost all cities also have trains or buses that go out to the suburbs, which tend to have less pricier living arrangements than “downtown”.  Whether the length (and cost) of the commute is worth it is your call.

Ditch your car and take public transit – or move your two legs and walk or ride a bike.  Venues, offices, and apartments are usually pretty dense, making a walk or ride perfectly reasonable.  Stop paying for a parking spot both at home and at work, car and full coverage motorcycle insurance, and gas (which also tends to be higher in cities).  It could easily save you an extra $200-300/month, even after you’ve paid for a public transit pass.

On a side note, larger metro areas have more craigslist posts, so more opportunities to find that bike for less.


Food is one of the unfortunate expenses of living in a city; the cost of shipping it in can raise the prices beyond what you’re willing to pay.  And don’t get me started on restaurant prices.  First, learn to cook if you don’t already know how, you’ll save yourself a lot of money just by cooking your own food.  Find the local ethnic stores for good quality, but inexpensive ingredients – each market will have it’s own specialty.  If there’s a farmers’ market that comes to town, research their prices before you buy.  In many big cities, these can be more expensive than the grocer down the street.  If you feel strongly about buying produce and meats from a local farmer, splurge if you can afford it – it’s a choice.

Eating out is usually prohibitively expensive, unless you go to fast food places that have uniform prices across the country.  They also usually have uniformly bad food.  Watch for “restaurant weeks”, which provide a prix fixe menu – just don’t spend that savings on drinks!


Major metro areas are full of free and cheap entertainment options.  Living in the DC area, I’m very spoiled by the Smithsonian – free museums all the time – but you should check with your local museums for free days, or reduced fares for locals.

Theaters (opera, musical, symphony, etc.) sometimes have “rush” tickets where you can get whatever seats are left an hour before the show for a (very) reduced fee.  So do major sports leagues.  Sure, they’re usually nosebleed seats, but you can still see the show or game – bring binoculars.   Ask at any venue that has seats left, they’re usually happy to sell the remaining seats at a reduced price rather than not sell them at all – work on your negotiating skills at the same time.

Find your local free paper that tells you where the free entertainment is.  Look through it and pick and choose what you like.  The Washington Post Express here in DC has a going out guide, which covers free and inexpensive options for each weekend.

And if you’re the drinking type – skip the bar, go to the local liquor store and invite some friends over – it’ll be about 20 times less expensive, especially if friends chip in.  And without the car, you don’t have to worry about drinking and driving.

While it’s unlikely that you’ll pay off your mortgage in 6 years like Crystal, you can still enjoy living in such an area on a relatively low salary. And refinancing home loan rates will make that even more doable if the rates have come down low enough. When I first moved to the DC metro area, I was making 45k as a single person, and I managed to save up a 10% down payment on a 250k townhouse on that salary. Doing so involves a lot of tradeoffs, but there’s a reason you live in the area in the first place, right?

14 thoughts on “Staying on a Budget in High Cost of Living Areas”

  1. Brian

    It’s all about choices when living it an a high cost area. I’m in NY, so I feel your pain. We take advantage of the free entertain when every possible. The local library has lot to offer. Eating at home is another big cost saver, epically with a family of 5.

  2. Taynia | The Fiscal Flamingo

    Oh – I love DC. All the free museums and monuments. A few years ago, we looked at moving to that area, but the housing was so expensive – I just couldn’t do it. Way to go on finding your townhouse and putting down 10%. Applause.

  3. The College Investor

    It’s always good to go in group whether you are living in an area with a high cost of living or you simply wanted to save money. Though, that only applies most of the time to single people, if you’re married or has a family, eating at home and doing simple and fun activities at home or free public places like parks for recreation will really help save you money.

  4. Mom @ Three is Plenty

    @Brian – there are a lot of tradeoffs to living in a high cost area – the biggest bonus being that salaries also tend to be higher in these areas, and they tend to be the areas where jobs are relatively easy to find.

    @Taynia – The housing here is *very* expensive – even in the suburbs. We live in a single-family house now in the far suburbs (near Dulles airport), and it’s still very expensive! You can still make choices about where you live in relation to specific areas and neighborhoods.

    @The College Investor – group living isn’t only for singles, but you’re right, that’s the demographic that tends to room together. Even with just a spouse/partner, it’s easier than if you have kids running around underfoot. I know it’s not the same in other areas (like NYC), but many the houses here in DC are way too big for one small family, and they rent out a room (or two).

  5. Emily @ evolvingPF

    I grew up in the DC area and my husband grew up in L.A. so until we moved to NC for grad school we had no concept of what a moderate cost-of-living area was like! We want to move to Boston, SF, or San Diego next so this is a short-lived respite. We’re pretty confident the upsides are worth it, though, and you just need to get creative with housing and transportation like you said to reduce those big chunks of your budget. I lived (close to the edge) in the DC area on 24k$/yr in 2008 so I know it can be done! By the time we move to one of those HCOL cities I expect to be earning much more money so it will be easier next time around. 🙂

  6. Meghan

    How do you get out of the city to explore the surrounding area without a car? I ask because it’s not so easy to take my dog in a Zipcar to go on a hike and I sold my car before moving to DC. I’m kind of miserable here and am on the verge of buying another car. The only thing keeping me from doing so is the $250/mo parking charge in my building. If given the choice, I’d definitely relocate back to an area that’s more affordable.

  7. Little House

    Great tips (and this is coming from someone who also lives in an expensive metro!) My spouse and I have only one car to reduce expenses and I ride my bike when he needs the car. However, we’re lucky when it comes to food since sunny California grows a lot of its own produce. Now we just need an earthquake (just kidding-sort of) to lower property prices. Okay, I only want to scare people away, not injure them. 😉

  8. Mom @ Three is Plenty

    @Emily – I went from a very tiny town in south Texas (where a 10-bedroom mansion on 10+ acres was $200k), to College Station which was slightly more expensive, to Pittsburgh, then to DC, so I got the full shock experience. In grad school, I was very short on funds and used a lot of these tips to survive, and unfortunately expanded my lifestyle along with the increased salary.

    @Meghan – A friend goes hiking with the Wanderbirds of DC (https://www.wanderbirds.org/) They provide transport from downtown, so you can go hiking without having a car. Not sure what their policies are on dogs, but you might at least meet someone who has a car and is willing to drive you?

    @Little House – I think most of our food comes from CA anyway! Although we have some excellent farmer’s markets and we were a member of a CSA for a while.

  9. I like how you acknowledge that there are sacrifices to living in a high cost area. I see lots of people in my profession who live in popular, but expensive, areas and do nothing but complain about not having enough money while they drive a Mercedes and go out to eat every night. Life is about trade offs. I live in a super cheap area, and miss some of the opportunities that a big city might provide, but we have everything we need, and it’s one of our keys to financial freedom.

  10. Mom @ Three is Plenty

    @Kim – There are tradeoffs to living in any area – big city or small town – I miss the lack of traffic in my tiny town a lot! It all depends on what you like and what your goals are.

  11. Bryce @ Save and Conquer

    Nice post. I wish my area had better public transit. I live 13 miles from work. It takes about 20-25 minutes to commute by car one way if no traffic jams on the freeways. It takes nearly 2 hours by bus. There are half-mile walks at each end and two bus transfers that have to be done, with a half-mile walk at one transfer. It’s just not feasible.

  12. Mark Ross

    There are really some great advantages when it comes to living in a first-class city, such as transportation and entertainment. Though some of the things you need may be expensive, there are some alternatives to it, you just have to be more resourceful to avoid spending too much.

  13. shelli @ writtenFYI

    This is a great post! You point out that there are lots of different choices to make when it comes to lifestyle and saving money — but one has to make CHOICES. We live so differently from many of our friends because we’ve downsized and simplified, and we’re so much happier for it. We’re not only saving money, but we’re saving energy, too.

  14. Tushar @ Everything Finance

    Places that have a high cost of living also tend to have a lot of free entertainment options. They are usually high cost of living because they are beautiful places, so enjoying the outdoors is another idea. I do enjoy your idea of getting some friends together at home, too.

Comments are closed.