Cost of Living in Southern California

Cost of Living in Southern California

This article is part of the Cost of Living by State Series and is a guest post by Robert Farrington from The College Investor which aims to provide financial freedom through information.

I hear on the news almost weekly how expensive it is to live in Southern California, and I don’t always agree.  While some things are cheaper in parts of the country (for the cost of my house, I could buy huge spreads in some parts of the country), all things are relative.

Some of My Costs

When I think of cost of living, here are some of my major expenses.  I have a nice suburban house in a good neighborhood – inland (no, not all Californians live on the beach or coast) – which is 20 minutes from everything I could ever dream of.  I have a 4 bedroom, 3 bathroom house on a half acre, with a great view.  It has a two car attached garage, a nice spread of grass, and lots of mature trees.

Cost of Living in Southern CaliforniaHowever, all of that comes at a cost – my home cost $575,000, and it is on the lower end of homes in my neighborhood, even at a price-per-square -foot of almost $240, which is cheap for the neighborhood as well.

But a home is more than just baseline costs – there are a lot of other expenses.  However, I’m lucky in that they are fairly cheap compared to other places.  For example, my property tax bill is only 1.1% annually, and thanks to a law known as Prop 13, they won’t be raised for the most part.

Utilities are also pretty cheap, except for water.  My average monthly gas and electric bill, year round, is $80.  I run the air conditioning maybe 5 days a year, and the same goes for the heater – maybe 5 days a year.  Water is the only killer – it is billed bi-monthly, and it comes in at around $280, so about $140 per month.  A large part of that is my large yard, but water in Southern California is expensive.  Some of my neighbors have even drilled wells and now use that water instead of paying for city water.

Finally, the last drawback of Southern California costs is transportation.  There is very little mass transit, and what does exist is poorly done.  As a result, I drive everywhere, and so does my wife.  We spend anywhere from $300-400 on gas alone each month, as I drive 17 miles one way to work, and she drives about 14 miles.  However, my 17 mile commute only takes me about 15 minutes, as it is all freeway, and it is great!  My wife, on the other hand, does sit in traffic every day, and her commute takes about 25 minutes.

The Perks of Southern California

What people forget is that Southern California is expensive because there are a ton of jobs, and they aren’t going away any time soon – the market is too diverse.  I’m in the hub of tech, biotech, defense contractors, and more.  There is huge government and private sector employment, and the unemployment rate is slightly lower than the national average.  However, if you want work, and have a college education, you can get a job quickly.

The better part of the employment picture is that the jobs pay a wage that allow for the “so-called” high cost of living in Southern California.  Yes, it does cost a bit more, but you have much higher earning potential and much more employment potential.

Furthermore, I’m not afraid to admit that I will pay a sunshine tax any day to live here.  I don’t know what snow is, or a blizzard, and drizzle is cause for alarm.  Never had a tornado or hurricane, and the closest to freezing it gets is 45 degrees.  Because of that, I save a lot of expenses related to everything storm, weather, and winter.  It keeps housing costs down, and more.

At the end of the day, it’s very hard to compare Southern California cost of living to those elsewhere, because the reasons for the higher cost can’t be justified elsewhere.  Yes, I could move to Montana, and get a huge property, but will I have a high paying job that is steady?  So there are trade-offs beyond just the basic costs!

Note from Forest: What an excellent insight! If you have any comments or thoughts for Robert or I then please leave a comment below. Also if you have any interest in writing a cost of living post for your State or area then please don’t hesitate to send an email to Forest@FrugalZeitgeist.com.

4 thoughts on “Cost of Living in Southern California”

  1. California. We have plenty of time to plan being that we don’t graduate till next year June. the three of us are serious about this plan but are not sure which direction to go. if anyone has any suggestions or advice for us that would be great. We would like a house kind of big with three to four rooms and at least three bathrooms. the three of us plan to split the total cost to live there but are not aware of other things such as if we would need credit and etc… thank you ahead of time.

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