Small Town Living

This is a guest post by Martin, who is preparing for retirement within the next 5 years; no later than his 40th birthday.  He is married, has 2 young children and lives and works in rural Alberta as a regional finance manager for a large energy company.

My family and I have lived in small town rural Alberta for the past 5 years after spending 5 years in Calgary.  To provide some context, our town has a population of about 3,500.  The nearest small city to us is about 150 KM away and the nearest major city is about 250 KM away (definitely not a bedroom community).  We plan to stay here and raise our family during our retirement and beyond that once the kids move on.  In examining the details of our retirement planning, we’ve found that living in a small town has significantly contributed to our ability to retire early for a number of reasons.

Capitalizing on House Price Differences
Generally, small town housing pricing is considerably cheaper than in cities.  In our case, we sold out of the big city and adequately replaced our house in terms of quality and size for considerably less than our city home’s sale proceeds.  In terms of our net worth, we effectively converted idle equity (I’ve never considered my primary residence in net worth and retirement calculations) into active financial investments, pushing us closer to our net worth retirement target.

Reduced Opportunities to Spend Money
The businesses that serve my community are utilitarian; not offering much beyond the basics.  Spending money on anything else requires a trip to the city or purchasing online.  This necessitates patience and planning which are the natural enemies of needless spending.  As for services such as dining, there is too little variety to get excited about eating out.  As a result, our dining out is less than a third of what it was when we lived in the city and had easy access to great restaurants.

Lower Cost of Living
There are several living expenses that have decreased by the simple nature of our community.  Fuel consumption goes down as everything is so close together.  Property taxes are generally less given the reduced municipal services.  Local pricing on services (mechanics, movie theatres, home contractors, etc.) are also less than in the city.

Cheaper Environment in which to Raise Children
We haven’t had the chance to prove this yet (our children are too young), but we feel that a small town will help us better control the cost of raising children.  Peer pressure regarding brands should be less (goes back to the lack of local availability).  Extracurricular activity options are limited.  Keeping up with the Joneses should not be as difficult in a small town given the lower average household income (although it only takes one over-spender to mess this up).

On the surface, it may seem that any financial benefits from relocating to a small town come at great sacrifice to quality of life.  It is true that there are sacrifices involved and there is plenty that I miss about the city (great ethnic restaurants, cultural opportunities, sporting events).  However, there are many intrinsic benefits that come from leaving the city that do not show up in a financial calculation (closer proximity to nature, less traffic, cleaner air, more time, greater sense of community, very little crime).  For us, these benefits more than make up for any sacrifices we made when we left the city.

Are you considering moving to a small town as part of a early retirement strategy?  Would you?

7 thoughts on “Small Town Living”

  1. Well, I am moving to a small island on the B.C. coast. I already have 5 acres of land there… and more than enough room for a big garden and tons of firewood to heat my cottage. The beach is a short stroll away – I can literally row a 100 metres off shore and catch all the fish and crab I need for my protein needs.

    Needless to say, food costs are going to plummet for me in my early retirement. And because I view fishing as entertainment, I am going to save on those costs as well!

    I can’t wait to escape big city living.

  2. I live in a small town and love it. The biggest difference is house prices. A comparable house in Toronto would have cost nearly 3-4 times as much, I couldn’t imagine the mortgage payments and interest costs. Many of my friends state that they would prefer to live in a smaller town but can’t because either they would not have a job in their field or a comparable job would pay much less. I guess my wife and I are just lucky that we are able to have solid careers in the smaller community we call home.

  3. I am definitely thinking about it for retirement. Should be able to cash out of my big-city place and have a comfortable retirement in a small town.

  4. While not specifically for early retirement, we did leave a big city to move three hours away to a much smaller ‘city’ (400,000 to 28,000) so that we didn’t have to both work full time while raising our son. It has allowed us to own a home with a small mortgage, and save much more of our income towards retirement. We also did it for some of the intangibles that you mention. Small towns/cities can be tough to move into, but for us it was certainly worth it.

  5. We live in a small town (5,000) in a mostly rural state in the US. We are actually moving to a somewhat larger town because we could not find co-op living in our town. We are making this move to save money and maintenance time. Added benefit is that my sister lives in the co-op.

    We are moving out of a community where we have lived for 30 years. It hurts to leave our long time connections. So for me those are the ups and the downs of moving, esp. later in life when one has roots.

  6. My hubby and I chose to buy a home in a rural community and commute to our jobs in the nearest small city. Since we bought, he was able to make his career happen about 5 minutes away from our home (although he has now had to retire due to medical issues.)

    The commuting costs are not fantastic for us – I figure we’ve probably spent close to $50,000 over the years commuting, and that does not include vehicle purchases. However, the intangible benefits are fantastic, as well as all the financial benefits you mentioned. And now that I carpool with someone from the same community to the same small city, our commuting costs are down about 1/3.

  7. we retired in our 40s and living in a small town really helped. our cost of living was lower, housing costs lower, we have built-in entertainment (woods and creek and etc.), room to grow our own food (huge garden), and on and on.

    we have considered moving to an even more rural location where jobs are scarce and property is cheap. it helps that we love the country, love outdoor activities, and have abundant hobbies we can enjoy here.

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