New York City’s bright lights and energy make it one of a kind. The cultural and financial capital of the world has so many things going for it, like its superior entertainment, commerce, media, shopping, art, fashion, and technology, that it’s an attractive living location for anyone.
It’s even more appealing for young adults who are ambitious and dream of the big city experience. This is why internships and full-time positions in NYC are some of the most sought after and desirable of all. Applications come flying in from all parts of the United States and the world.
But, this city becomes a little less attractive once you truly understand the cost of living in New York City and how expensive your life will become. With this considered, is living in the capital of the world worth the financial stress and sacrifice? Let’s dive in to see how expensive it really is.
Cost Of Living In NYC
To get a clear understanding of the cost of living in NYC, I decided to compare my current salary in Cincinnati, OH with a comparable New York salary. I used a cost of living calculator that asked the city I live in and the comparison city, plus my current salary, to calculate the results.
If you’re not familiar with Cincinnati, I like to describe it as a bigger city with a small-town feel. To help your perspective of its size, Cincinnati is the #34 ranked TV market in the country (New York is #1, Los Angeles is #2, and Chicago is #3). And the standard of living is reasonable, as it’s not overly expensive but not rural-city cheap. None of my out-of-town friends have complained about the price of things.
Also, to give you an idea of my salary (the second requirement in the cost of living calculator), my income is in the 95th percentile for 22-year-olds. While I’m not even that close to a six figure salary, I’m not scraping by either.
Now that you know about Cincinnati and my salary, here are the calculator’s results for the cost of living in New York City.
The image above shows that I need to make $136,024 for my salary to go the same distance in New York as it currently does in Cincinnati. While I didn’t tell you my exact salary, I can tell you that the difference in this NYC salary is pretty significant. And although my company might pay more for a New York position, I doubt it would be up to par with this figure.
Now let’s take a look at the calculator’s breakdown for the price difference in each major category between New York and Cincinnati.
The craziest difference is clearly the 479% more expensive housing in NYC. I had a clue about the outrageous cost of rent in New York, but I had no idea it’s almost five times as expensive as where I live. Yikes!
That sounds painful just typing it. So the thought of paying it each month for a room the size of a closet space makes me cringe. How do you do it New Yorkers?
And I’m sure the 37% more expensive New York City food and 30% more expensive transportation would quickly add up to thousands of dollars, if not tens of thousands, annually. Not to mention the entertainment and going out costs, or if you had student loans while trying to afford NYC.
It’s no wonder why I’d need to make $136,000 to keep my standard of living.
Play With The Cost Of Living Calculator
I selected where I currently live and New York City as my example to get the cost of living difference. But the city where you live and the other city you’re comparing are going to be different.
That’s why it will be better for you to use the same cost of living calculator for your individual case. Play around to compare different cities across the country and compare cities in certain states.
For example, say you want to live out west. You see how expensive California is and get bummed. But, then you find that Las Vegas might be a comparable area that also won’t break your bank account. Plus, being in Vegas allows you to easily visit or vacation in California.
Or if you want to live in Florida for the weather but don’t necessarily have a specific city in mind, you can narrow it down by finding the most economic location. You’ll see that Miami is the most expensive, Orlando is in the middle, and Tampa is the least expensive of the three.
I randomly will spend 10 minutes on this calculator like every month because I find it fascinating. And because I’m a weirdo, but we’re all some type of weird—you included.
The Lesson: Consider Salary In Context
The point of this post is to highlight one of the biggest financial oversights I see from young adults when considering multiple offers. Their mistake is evaluating salaries in a vacuum without any context. For example, they compare making $50,000 in Chicago to making $45,000 in Columbus to making $60,000 in New York City.
Based off of these three choices, they assume $60,000 in NYC is the best financial offer, without considering all the expenses like rent, transportation, and food. Ironically, out of the three offers, this person is probably going to get the most bang for their buck in Columbus. And if they can live at home or get some other advantage, then Columbus far outweighs the other two options in terms of money.
So, next time you’re considering internships or full-time positions in different cities, don’t think of the salary by itself, as we saw how important context is from looking at the cost of living in NYC.
But instead consider the salary in the context of the city’s cost of living. Because becoming rich is never about how much money you make, but how much of the money you’re able to save and make it grow.
Readers, does the cost of living in NYC scare you away? Is living in New York City worth it? How does a city’s cost of living factor in your decision to work there? Any other thoughts or questions related to this?
Should I Wait To Buy Bitcoin And Ethereum?
When cryptocurrency prices spike, you may question if you should wait to buy Bitcoin or Ethereum at a lower price later. Buying low is only wise after all.
Of course I don’t disagree with the reasoning behind the “buy low, sell high” thinking.
However, the methodology can be difficult if not impossible to accomplish with some investments in real life. And following that philosophy will cost you big opportunities to make money investing in Bitcoin, Ethereum, or other assets.
Let me explain the problem behind this philosophy—because once you understand you’ll become a better investor with more money to show for your efforts than you do now.
The Problem With Waiting To Buy Bitcoin And Ethereum
For people who believe in the cryptocurrency technology and are convinced they’re going to make money investing in the long term, what’s the logic in waiting to buy Bitcoin, Ethereum, or any other asset?
It’s simple: the thought process is by waiting to buy at a later time they can get Bitcoin at a cheaper price and make more money years from the date you purchased.
In a vacuum that strategy is unbeatable. However the market doesn’t work that way! In reality this strategy is very often botched.
Because every day you wait to buy Bitcoin, you run the risk of not buying lower—which you intend—but buying higher—the complete opposite of your plan.
Many times the price is never lower in the future than what it is currently. So buying high, could still mean buying lower than any price point you’re ever going to get going forward. Got it?
It doesn’t make sense to miss out on gains because you’re waiting for the perfect storm when the price of Bitcoin drops 50% in a day—that’s extremely unlikely and by no means guaranteed to happen.
With potentially revolutionary assets like this, my opinion is it’s better to get in the game as soon as possible, even if the price is at an all-time high and you feel like johnny-come-lately.
Think about this: The price of Bitcoin was once at an all-time high of $10, so if you never invested then because you were waiting until it went down to $8 then you cost yourself millions of dollars as one Bitcoin is trading for over $8,000 today.
I didn’t forget about the visual learners out there. Take a look at this price chart to look at every investor that got hammered assuming they waited for Bitcoin to go down when instead it shot up to the moon almost every month since 2013.
There are only a few months, from 2013 on, in that chart where you’d have been better off to not buy Bitcoin and instead buy it the next month. The super majority of months show that it’s crazy talk to wait to buy this hot cryptocurrency.
And this logic is exactly why it makes the most sense to invest with a strategy called dollar-cost averaging.
Use Dollar-Cost Averaging To Build Your Position
Dollar-cost averaging is an investment strategy that recommends you buy a fixed dollar amount of an asset at the same time every month.
For example, someone using dollar-cost averaging to invest in this coin would set aside $300 to purchase Bitcoin on the 15th of every month for (at least) 12 months—no matter the current cost of one Bitcoin.
By doing this, the individual purchases more Bitcoin (or shares) when the prices are low and fewer Bitcoin (or shares) when the price is high. But their dollar amount invested stays the same following this philosophy—and they’re guaranteed to own some of the asset instead of wait on the sidelines.
The difference is simply you’re just gradually investing over months and years instead of investing a huge sum of money one day. And based on the past, performance increases when you invest with dollar-cast averaging.
The reason this technique works well is it’s impossible to time the market.
No one knows when Bitcoin, Ethereum, or stock prices are going to go up or down at any given moment. There’s too many moving parts and random things that can affect the price to accurately predict price movements.
And dollar-cost averaging ensures you don’t buy high and takes your emotions out of investing since all you have to do is stick to a set plan. Even better, set up an automatic investment the day after you get your paycheck to relieve you of the manual labor.
This is a winning investing strategy you should absolutely adapt to maximize your profits.
While most people are either waiting too long to invest in these cryptocurrencies or buying them at their peaks, you’ll be using dollar cost-averaging to rake in more profits.
Keep at this and you’ll go from a percentage of a coin to owning a full coin, and then maybe owning 3, 5, or 10 coins plus over time.
If cryptocurrencies like Bitcoin and Ethereum are not your thing, I’d encourage you to execute on this dollar-cost averaging strategy to buy index funds in the stock market. The strategy works just as well here.
And it’s not only a smart strategy in this space, but when wanting to increase your position in any asset—painting, real estate, coin collections, car collections, etc.
Best of luck in your investments and journey to financial freedom!
The above references an opinion and is for information purposes only. It is not intended to be investment advice. Seek a duly licensed professional for investment advice.
Interview: Multi-Millionaire & CreditLoan.com Founder, Dan Wesley
It’s not every day I get to interview an early Internet power player like this guy.
Dan Wesley founded CreditLoan.com in 2003 and then exited this startup 8 years later with an 8 figure payout. He’s also been a contributor for top publications like Forbes, Mashable, Huffington Post, and Inc.—among other impressive accomplishments.
Confident that Mr. Wesley is rich in knowledge and you guys would take away some solid insights from him, I asked him for an interview and he happily said yes.
The main topics covered below are financial ones like student loans, credit cards, personal loans—you know, that important stuff that ultimately decides how much money you end up with, which controls how free you are to do what you love. And then the interview finishes off with Dan sharing some of his best life lessons.
Getting your money right is a big deal and Dan is going to help us.
Let’s just dive into this goodness so you don’t have to wait any longer.
1. What led you to start CreditLoan.com and help millions of people financially in the process?
Humble beginnings – I grew up well below the poverty line with the deck stacked against me, like millions from all walks of life, face today. So, I decided to do something about it long before the Nerdwallet’s of the world.
As you can imagine in 1998, Google is, what, 3 years old? Yahoo, Lycos, Netscape are the main events. It took me awhile to get going (2003 is when I really started to publish consistently). It’s been a fairy tale of sorts, as I ended up completely bootstrapping this from a $5,000 tax return to an 8 figure exit.
I still run the business today, the only regret is I only started to scale things (with venture capital) just a year ago.
I could have been Nerdwallet… but I’ll take it!
2. Where do many college students go wrong with student loans and what should they do instead?
That’s a really great question. I’m 40 and while I don’t have college bound children yet, I took student loans to survive. I was the first to graduate in my family with a college degree. So my parents had just as much understanding as I did of student loans plus long term implications. This is a fancy way of saying basically no party had ANY idea what I was getting myself into lol!
But if I had a child college bound today, they would definitely be a beneficiary from my student loan experience. So is it survival? Generational knowledge gap equaling naivety across the board (parent <=>)? The lack of obvious life experience for most college students? You only learn from making mistakes right? Is that inevitable? I don’t know.
Personally, I know I should’ve just stuck to subsidized loans but I ended up taking on unsubsidized as well (I don’t believe these exist anymore and rightfully so). The student loan alternatives: are grants (is Matthew Lesko still around? ha!), employer tuition assistance, military GI bill, and scholarships.
3. Since 1998, when you started helping consumers on financial issues, until now in 2017, what’s changed most about personal finance in your opinion?
Great question! First off, the amount of personal finance information on the web, hands down. They call it “content shock”. Digital information overload plus ubiquity of mobile with always being “connected” (love this graphic…worth a 1,000 words I tell ya).
I read a few years back (2012 I believe), over 2 million pieces of content are published everyday. I can’t imagine how that has grown exponential today. Moreover, I think there’s a form of censorship in play (unintentional in my opinion, explained below).
As the top finance Google results are dominated by brands (nerdwallet, bankrate, thesimpledollar, thebalance) it’s tough for small businesses with better end user value propositions to overcome these behemoths. But I don’t think Google is doing this on purpose—naturally you have so many bad players that Google (as the police officer) ends rewarding the brands that are trusted the most.
If they are trusted the most, you can assume they’re content is commensurate (plays right into Google’s “yo money, yo life” search ranking guidelines).
At the end of the day, the consumer votes with engagement metrics and all Google does is aggregate that against the population of finance sites—it’s that simple in my opinion.
We always pander to the user, not the search engine.
4. Do you recommend 20+ year olds get a credit card? Why or why not?
Can we really stop them? Paraphrasing a great quote, “The only substitute for life experience is being 20”, right?
I’m 50/50 on this. It’s situational – some 20 year olds act like their 40 and others act like they are 10. The key here in my opinion, is limit yourself to just 1 major credit card. You want that credit card as an outlet, safety valve (discretionary or not, things happen and we are human after at all).
In my opinion, no credit card equals no life experience, more risk, potentially more costly to a 20 year olds’ cashflow. (Example: overdraft fee or a late electric bill payment sometimes exceed the interest only payment of that respective credit card.)
In my opinion, a credit card equals life experience if used responsibly; you want that credit card as an outlet, safety valve (discretionary or not…things happen and we are human after at all). Bad credit, as we know, has a nasty butterfly effect when you are trying to finance a car, get an apartment, it unnecessarily complicates your life (I’ve been there begging my parents to co-sign).
Related: Credit Cards Are Your Best Friend
5. How many credit cards do you personally have? What ones? And what’s the purpose behind each one?
I have an Amex Black, Discover, Visa Black. Primary use is, honestly, an additional layer of security (would rather have my credit card compromised vs my bank card).
The Amex Black is awesome for making a point though. I don’t play the I’m-a-multimillionaire-card (you can ask anyone). I’m a pretty laid back, humble guy, but I can totally upend any perceived judgement, underestimation fairly quickly ;).
6. I’m sure there’s a wealth of information you could go on and on about when it comes to this. But what’s your best single piece of advice for a young adult who needs a personal loan?
My single best advice involves one sheet of paper and two columns: pros on the left, cons on the right. Then you can truly figure out if it’s a need or a want.
Use cause and effect exercise so you can identify the drivers of obtaining a personal loan.
Secondary to that, if you embark on the personal loan quest, be sure to shop around. Get at least 3 quotes: 2 digital (like our site or lending club) and 1 brick n mortar (your local bank).
7. Say I’m 27 years old needing a mortgage for my first home. What’s a key point I need to know to come out with the best interest rate possible?
Due diligence, as you know, many governors in play here. Your credit score and income are two items that single-handedly dictate everything.
Assuming those items are in line, I would advocate for comparative shopping (get 3 quotes).
With so many businesses out there, like Nationwide at times, competing for your business, fully maximize that leverage and use points to buy down the rate.
8. Is there one final knowledge bomb you want to drop on us?
Take things one day at time, can’t stress this enough. If one day at a time is too overwhelming, slow it down even further. One hour at a time, whatever it takes to catch your breath.
It’s so important. I always remind my 8-year-old son (he plays baseball) when his team is losing:
“How many runs can you score at once?”
He replies: “1 dad…”
I reply: “Then work on 1, son, then 2, then 3”, one at a time.
This puts the most important things into perspective, so you bite off what you can chew and this usually leads to a much better outcome in my experience.
Also, here are a few “Danisms”: “refuse to be a statistic”, “never be denied”, and “move like you got a purpose in life”.
9. Where can we go to learn more about what you do and you?
Here’s my LinkedIn profile. I will be launching my personal website by EOY.
Like I mentioned before, I do write for Entrepreneur and my work has been featured in over 150 articles across 61 publications including Time Magazine, WSJ and Business Insider.
CreditLoan.com has also been featured in over 48 books and in 2011, I helped Guy Kawasaki launch his new book (view here).
There’s a ton of important information shared in this interview.
But, if you’re a regular reader of Take Your Success, you should know by now that life isn’t about absorbing knowledge and calling it a day. You need to take what Dan Wesley said and put it to action if you desire to see positive results.
I want you to win. Do you want yourself to?
Related: The Best Time To Start Is Now
Why Your Salary Is Costing You Millions In Earned Income
The average person craves a salaried job the for comfort, security, and the guarantee they can pay their bills.
But a salary will cost countless people millions of dollars in earned income throughout their career.
It’s ironic that we want a guaranteed income so we can live comfortably leading up to and through retirement.
That’s what society promises, at least, until things become uncomfortable.
Once something bad happens—you get fired, laid off, don’t save enough, salary increase doesn’t keep pace with inflation, make bad financial choices, have expensive kids, get divorced—and now you’re far away from a comfortable retirement nest egg plus have less skills and determination to go make your own money.
The salaried gig looks great on the outside, until you dive deeper to see that it’s often the single biggest demotivator and limiting factor to earning more money.
Your Salary Kills Urgency And Entices Laziness
Though not entirely similar, a salary shares some common characteristics of communism.
You get the same paycheck every month regardless of your performance—pretty close to communism.
At many jobs, a guy like Bill will voluntarily show up at 6 AM every work morning and leave at 8 PM, while slacker Johnny over there shows up at 8 AM and leaves at 6 PM and is paid the exact same wage as Bill.
The paycheck doesn’t reflect the reality that Bill worked 20 plus more hours than Johnny and got a heck of a lot more done than Johnny.
Talk about unfair? The salary gig is cruel, I’m telling you.
And since that situation isn’t fair, human nature will get Bill to think, “Stop working so hard. Why bother to put in the extra hours if I’m not rewarded? I’m going to start acting like Johnny because he’s doing just what’s asked of him and the boss doesn’t notice my performance.”
Now I’m not naive to think that bonuses, raises, and promotions aren’t a thing in the workforce—a differentiator from communism.
However, those are just too much out of your control to count on and you’re not rewarded until months or years later. And they often require smart salary negotiation, which is difficult if you’re not practiced, on top of luck.
Plus, in the example above, if Bill decides to work less and deliver less value then he won’t get the bonus or raise even if there’s one available.
The idea is that a salary often persuades workers to do the bare minimum to keep their job and keep getting paid.
It doesn’t entice individuals to give their all each and every day to not only make themselves double the income, but the company double the return on investment in them as well.
Knowing a paycheck is coming has a cocaine effect where you’re addicted to that monthly guaranteed income even though it’s not in your best interest to rely on it.
What’s worse is the damage it does to your overall net worth.
Guaranteed Income Costs You Millions Of Dollars
The addiction of needing a salary will costs millions of people, millions of dollars in lost income.
Let’s take a look at the multiple reasons why a salary sets you up to fail in the chase towards wealth.
For one, the average salary increase in the US doesn’t match the potential of a hustler who gets to decide their own income based on their work ethic.
A May 2017 forecast from WorldatWork predicts that salary increase budgets for U.S. employers will grow 3 percent on average in 2018 across most employee categories.
Say you make $50,000 a year at your 9 to 5 job you despise. Are you going to bust your butt for 261 work days in the year for a 3% salary increase? I’m not. We’re only talking about $1,500 at that rate.
The work compared to the payoff doesn’t add up to a good deal. It’s not motivating to me. It shouldn’t motivate you.
I could work at McDonald’s and come out with more dollars per hour than that thievery.
You’ll drag your feet for a 3% salary increase (+$1,500), but perform like a workhorse if you have a definite opportunity to double your current income (+$50,000).
That’s a difference in $48,600 between the two of them for the year and this is just the beginning. The difference is exponential over the lifetime of a career.
Second, when your income is entirely in your hands—be it as a beginner entrepreneur, commission sales rep, recruiter, or other job—your butt is on the hot seat from the get go to perform.
There’s no room to take it easy if you want to eat that week and keep your business alive.
Plus, you’ll be motivated to save extra money since this can turn into the business’ emergency fund or a payroll account to hire some contractors or full-time employees.
Meaning each dollar you earn has a higher purpose than eating expensive meals and treating yourself to materialistic clothing purchases.
And by investing in your business, your company and you personally will take home more profits than if your income was tied down by a normal 9 to 5 job.
I’m not surprised when I look at the richest people in each state only to find that none of them are salaried works but entrepreneurs and business owners.
Now you don’t have to be an entrepreneur, but you do need a job with no ceiling on your income if you want to get maximum performance out of yourself and the rewards that come with it.
Third, the rate of your learning is immensely sped up when you have to rely on your own work ethic to make money and pay the bills. You can’t afford to be out of the know in your industry if you want to compete with your competitors.
This is the pressure that forces you to gain knowledge and then use that experience to win more deals for yourself.
Plus, you can compound your knowledge to make more money in the future or consult others on the keys to success based on your experience. These opportunities aren’t there in the corporate world.
By getting off the addicting salary drug and choosing your own medicine, you force yourself to provide value to others so you can ultimately get paid what you’re worth.
And the more patient and skilled you become, the greater this income increases over years then decades.
That’s how your income grows by hundreds of thousands of dollars every year, which adds up to millions, instead of 3% and $1,500 (if that) every year.
Work Like You’re Not On Salary
You only get to do this thing called life once.
Why take the safe and boring road with a salaried job that is like driving a minivan straight on a flat road until retirement, when you can take the thrilling road in a sports car up a mountain with jagged cliffs and unbelievable views?
Bet on yourself. Work your face off. And work like you’re not on salary.
By mixing things up, you’ll discover if your company rewards you for going above and beyond what’s asked of you.
And if they do incentivize your efforts then you don’t need to find a different job. Maybe it doesn’t though and you see the writing on the wall: you’re worth millions more than you will ever earn here so you find a better job you love.
It’s like any pursuit in life, you need to get out of your comfort zone to truly push yourself, grow, and become the best version of yourself.
Happiness comes from personal growth. So take the jump and make the most of it.
Millions of dollars are nice, but the feeling of personal satisfaction from working incredibly hard and getting rewarded for it will far trump the money—every time.