Dear Dr. Don,
I'll soon be graduating from college and will (hopefully) be comparing job offers in the next few months.
I've been looking at Web sites with cost-of-living calculators, and I was wondering how heavily they should influence my decision on a job offer. I will rent an apartment for at least five to seven years, and it seems like the difference between two cities in rent is not as great as the difference in the cost of a home.
If I will only be renting, would the difference in cost of living between two cities be overstated? Or should I put a fair amount of trust in these calculators?
-- Mike Migrate
Dear Mike,
Cost-of-living differences between cities are certainly something to consider, but life's so much more than dollars and cents. Being close to family, friends and things you like to do when you're not working is important. So is good health care availability, as well as a range of job opportunities in case your first job isn't your last job.
Bankrate's Cost-of-living comparison calculator takes into account dozens of items in six broad categories -- groceries, housing, utilities, transportation, health care and miscellaneous goods and services. But it doesn't include the effects of state and local taxes, which can be vastly different from one locale to another.
Some cost-of-living calculators, like the one at Salary.com, go beyond costs to also consider income differentials -- because employers weigh lower labor costs when making their decision where to locate.
Talk to the people at your college's placement office for ideas on how to research lifestyle decisions along with employment decisions. I don't know what your field is, but this is likely to be a difficult year for finding work. I hope you have the opportunity to choose between offers.