The Financial Benefits of Small Town Living

Has your bank account got the bustling city blues? If you’ve ever considered heading somewhere that’s a bit more provincial, you might find some monetary advantages that suit you. Take it from current small town gal Ruth, who’s seen the benefits to her financial security.

When PocketSmith asked me to share my experiences of the financial benefits of small-town living, I immediately began jotting down thoughts, and my very first thought was this:

Oh, how do I count the ways?

My thoughts rapidly expanded to a full-blown conversation with myself (I work alone) about how small-town living has so many benefits, but not all of them are financial.

I’ve had the pleasure of living in Christchurch, Wellington and Dunedin, the second, third and seventh largest urban areas in New Zealand. I now live in the 67th! I have certainly downsized my town.

Housing is usually cheaper

We moved to a small town in Central Otago because there was a housing shortage in Christchurch, the last city we lived in. That pushed house prices up and out of our league. It made us look elsewhere, and take many road trips to find a more affordable region where we bought our next home

A trap for city slickers moving to a small town is that they trade a city house on a small section for a country house on a big block of land. The amount of money spent might be the same. However, the ongoing costs of a lifestyle property and the sheer amount of work involved in upkeep are far greater. It is very easy to move to a small town and spend more. If you are moving to save money, think carefully about your housing purchase.

Sometimes, completely uprooting yourself from all you know is what it takes to find affordable housing and improve your life — if that’s what you’re happy to do. We had no connection to this region except for a family member who has since moved elsewhere. Sadly we left close family behind. However, we picked a great spot and have never suffered from a shortage of city visitors, who always stay awhile because they are on holiday. The next best thing to owning a holiday home is having friends who own a home in the town you want to holiday in!

Employment tends to be more secure

With housing sorted, employment is the second most important consideration. When you downsize the town, in my experience, you commonly downsize the salary. This surprised me, given that products and services are relatively similar in price. 

So I advise those who move to a small town to retain their current employment and take their job and higher salary with them, if they can. I’m constantly surprised by the community of work-from-home employees in my town, earning significant incomes working for some big national and international companies. But, if that is not an option, then you need to be prepared to research remuneration for your role, negotiate your wage or salary, and be aware that you will most likely work for a smaller employer.

I’ve realized that employment is incredibly stable in my small town. If you start with an employer and find a great fit, they don’t want you to leave, and you don’t see why you should! Employers work hard to retain good staff because they have a limited pool of employees to draw upon. Also, a lot of work opportunities come through word of mouth, which I find is the way to find the best career fit. I’ve never had a problem with finding work.

Plus, it is my view that in my small town, at least, it’s relatively recession-proof. Each business has a customer base who want their products and services, so there are not excessive amounts of the same business competing for customers. Yes, this might, in theory, reduce competition, but if the prices get too high in small towns, customers don’t let their feet do the talking by taking their business elsewhere. No, they literally tell the business owner they are dissatisfied with their product or service. The feedback is direct and immediate, which seems to keep the whole system in check.

Alexandra — Ruth's small town in Central Otago, New Zealand.

The most significant saving is needing less

When we lived in cities, we used to jokingly say we were going ‘hunter gathering’ at the weekend, where we moved from a mall to a restaurant to a hardware store, stocking up on the two things we were looking for and filling up the car with ten things we didn’t know we needed until we saw them. 

See it, want it, buy it. 

Quietly, gently and almost without noticing, our spending dropped when we downsized our town. We saw less for sale because fewer shops were selling things, so the urge to spend quietly left us. Initially, we kept driving the hour to our closest large town or buying online, but over time, our wants drained away, and we saved a fortune. When I go to a big city, I’m now shocked at the quantity of stuff available. The most significant saving I have noticed in my PocketSmith budget is fewer consumer items purchased because there is less to buy. Each time we holiday in a city, solely because there is more stuff to buy, I see my spending on consumer items explode. 

Fewer opportunities or different opportunities?

There are different things to do in small towns that are generally cheaper. It’s harder to find organized entertainment such as a ballet, comedy festival, or big sports event, meaning you will undoubtedly save money. When big things happen in small towns, the event is cheap, and everyone shows up, creating a fantastic vibe. Without those big events, you have to find ways to have fun, which requires you to get out and about in your community and find what’s on, or create your own event. So instead of paying an entry fee to a single event you attend and leave, it’s not uncommon to turn up to an event, recognize many people at it, and take part too. I know I’m never bored with the cheap fun my town offers.

Some surprise benefits to our finances

I thought we would spend more on fuel because we drive longer distances between towns. Although fuel is priced similarly to other places (we are often cheaper than the main centers), we only head out of town a few times a month. However, when at home, I can walk everywhere. Overall, we use less fuel.

About 22% of our spending is done at the supermarket. However, with fewer choices of restaurants, we naturally eat most of our meals at home. And instead of dining out with friends, we dine at each other’s homes, meaning food and entertainment are provided under our grocery budget! 

Although my town has gym facilities, I’ve never found a need to use them because I can run, walk or bike out my front door to exercise in my region’s incredible landscape. I can do an online workout or walk to my local swimming pool, tennis club, sports ground, or BMX track (as if!)

I love living in a smaller town. It doesn’t mean I’ll never leave, but for now, it is perfect. Had we arrived here and expected to continue to try to live our city life in a smaller town, our costs would have ballooned. Instead, we went with the local flow and realized we needed to adapt and find contentment. We had to adjust to our new surroundings, they didn’t have to adjust to us, and the slower pace of life that you find in smaller towns does mean that if you try, you can live on less money. 

While the prices of homes in my area have grown over time, that is not to say that there are not plenty of other regions in New Zealand with more affordable housing, plenty of jobs, friendly people, and a quality lifestyle. You just need to leave the city limits and go out and explore.

Ruth blogs at all about how she and her family handle money. What’s the secret? Spend less than you earn, invest the difference, avoid debt and budget each dollar that flows through your hands. She firmly believes that if you can just get the basics right, life becomes easier from there on in.

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