Friday Reader Case: Moving to Alaska. Should I Buy A House?

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Hi all! As you know we’ll going to be at Chautauqua Ecuador in 2 weeks with Mr. Money Mustache, JLCollins, Vicki Robin, and Jesse Mecham from YouNeedABudget. Since we’ll be spending most of our time with the attendees, the next Reader Case will be replaced with updates from the events. So before we head out, I picked a really meaty Friday Reader case for you to chew on. Enjoy!


I’m 23 years old. I’m a fresh graduate with $50,000 in student loans and am starting my very first full-time job teaching 2nd grade in Bethel, Alaska! 

I’m getting married soon (more like “eloping” though, not spending any money on ANYTHING) and will be bringing my boyfriend/ husband who has an additional $10,000 in student loans, not to mention our collective $13,000 in credit card debt (financial aid didn’t cover my summer courses unfortunately). So, in all we have a collective $73,000 in debt and I’ve accepted a job in bush Alaska making $58,000 before tax.

 –Annual family income: $58,000 before tax (He will also get a job, but we can’t plan on how much it will be at this point) 

–Monthly family spending: projected $2,750- $3,000

 –My student loan debt: $50,000 student loan interest: between 3.86% and 6.8% (average 5.08%) monthly minimum payment: unknown, based on income 

–My credit card debt: $9,000 credit card interest: 0% APR on various cards, earliest 0% APR ends September 2017 (should have it paid off) monthly minimum payments: about $100 collectively 

–His student loan debt: $9,700 student loan interest: 3.86% monthly minimum payment: $210

–His credit card debt: $4,000 credit card interest: 0% APR until November 2018 monthly minimum payment: something under $100

–Fixed asset: Truck worth about $3,000, paid off

–Savings: $0! 😀

Now, Alaska is a unique place to live; 0% property/ state income tax, much higher cost of moving due to import costs, and needing about $10,000 in moving costs because we have to barge over our truck due to the town not being connected to any roads… We also do not plan on staying here permanently. The idea is to take advantage of the VERY high teaching salary for 5-10 years, save everything, and then retire early! Also, being a teacher I qualify for the federal loan forgiveness program, but I don’t want to plan around it because I personally can’t see it living through this Trump/ Devos era.

Of course, in working out the kinks of my master plan, I’ve come across some dilemmas. The most harrowing being whether to rent or buy a house. I’ve read your blog, so I know your opinions on buying a house, but hear me out: 

Option 1: We rent a house for $2,100 monthly with utilities (like I said, cost of living here is high due to its remoteness). That’s $25,200 per year, and pretend we stay in Alaska for 5 years. That’s $126,000 in rent money that we have dumped into our landlord’s pocket and leave Alaska with nothing to show for. 

Option 2: We buy a house for $126,000 and live in it for 5 years. The housing market over there is awful (very expensive shacks…) so say at the end of 5 years we sell it for $115,000. Minus $15,000 in collective maintenance, minus $10,000 in seller fees, minus $20,000 in any other homeowner expenses (just for fun), and we actually only make back $70,000 from our original $126,000 house purchase. HOWEVER, compared to renting, that’s still $70,000 that we leave with in our pockets as opposed to renting. Which means that after 5 years we really only spent $56,000 on a home instead of $126,000 on renting. 

To me, I think “buy!”– but after reading your blog, and your very strong opinions on buying, I still can’t find a good long-term, mathematical reason not to. I assume I must be missing something, and I want to go into this mission in Alaska with a ready-made plan for early retirement, so I want to know from the expert what the best situation is that I can make for myself.  

Aside from this rent/ buy question, there’s also the question of how long we would need to be in Alaska before FI became a reality. On only my paycheck, it’s a long shot. But, while my paycheck will be enough to cover our cost of living and a tiny bit of saving, his entire paycheck can be pocketed. He’s a mechanic, but wants to work part-time so we can travel when school is out in the summer. So I’m estimating an additional $21,000 before tax to add to our savings ($15/ hour X 35 hours per week X 40 weeks).

So, my second question, with this information and the investing I plan on doing based on information from your blog, how realistic is my 5-10 year plan for early retirement? 

Your fan,



Current Gross Income:$58,000/year
Net Income:$48,503/year
Estimated spending:$3000*12 = $36,000/year
Investable Assets:$0.

Hoo boy. There is a LOT going on here. I see the words “credit card debt,” and “student debt,” and “collective $73,000” and “I want to buy a house” which immediately makes me want to vomit.

But as I dug deeper into the numbers I realized that this case study is best analyzed by trying to answer 3 questions:

  1. Should she buy or rent?
  2. Should she move to Alaska?
  3. When can she retire?

Get it? Got it? Great. So first…

Should She Buy Or Rent?

Now I started preparing a big long analysis talking about ownership costs, and PMI, and the 1% rule, but then I realized that this entire exercise was pointless because of the following:

–Savings: $0! 😀

…Yeah. That.

You have $0 savings, a pile of debt, and you want to get into more debt? Ignoring the philosophical debate about “good debt” vs “bad debt” and whatever crap the real estate industry feeds us, you need at least 5% to put down before the bank will give you a mortgage. So a house is quite simply off the table, for now. Even if the math suggests that buying is a good idea, you’ll need to rent and work for at least a year to pay off some of that credit card debt and save up for the down payment. After that, you can start worrying about interest rates and carrying costs.

Should She Move To Alaska?

OK so here’s where things get really dire. If AB rents for the first year instead of buying since she has no money saved up, then her estimated living expenses jumps from $3000 to $5100 a month, which means her living expenses goes up to $61,200 a year. And given her pre-tax salary of $58,000…


Her living expenses would eclipse her pre-tax salary. So even if she somehow paid 0 in federal and state taxes, by taking this job she’s actually cash flow NEGATIVE from day one. Which makes it impossible to either pay off her debt, or save up for a down payment. So in this case, even if housing did turn out to be a good way to lower her living expenses, there’s no way to actually get there because her salary doesn’t come close to paying the living costs of being in Alaska!

So basically, DON’T TAKE THIS JOB!!! The living costs are so high that you would actually LOSE money by moving to Alaska.

This whole thing doesn’t work because the cost of living is so damned high. $2100 a month in rent?!? I know people in New York City who are paying less than that! Hell, Numbeo suggests that the average rent in Anchorage, AK is only $1200, not $2100, so something is going horribly wrong with AB’s rent estimate.

And looking back through the reader email, I think the “horribly wrong” part is right here:

We rent a house for $2,100 monthly with utilities…

Uh, no. You can’t rent a house. Nor can you buy a house, because you don’t have any money yet. That’s how money works.

So throw out the idea of living in a house for now. Ain’t gonna happen. But lets say she can rent a nice one-bedroom apartment for Numbeo’s estimate of $1200. Does the math work then?

Well, let’s assume she’s a little careful with her spending and can hit the lower estimate of $2750 for living expenses. Then we add rent of $1200. With that, we get $3950 a month, or $47,400. So that’s better.

But when we plug her salary in a tax calculator, we get an after-tax salary (assuming no 401k contributions because AB’s gonna need every dollar she can get now) of $48,503. So now this job is juuuuuuust barely paying her living expenses. And I hope to God that the $2750 per month she quoted includes the monthly minimum payments on her credit card and student debt. If they don’t and we have to add that on top, this job is once again cash-flow negative.

So can she move to Alaska?

Maybe. If she keeps a clamp on her living expenses, rents a $1200 a month apartment instead of a house, and just pays the bare minimum on her credit card debt and student loans, the job will just barely cover her living expenses. She won’t be able to save anything or make much progress on her debt, but at least she’ll be in Alaska, so yay?

When Can She Retire?

Short answer: She can’t. Taking this job locks her into a savings rate of around 0%, which means she will never become FI.

Or at least, not on her own. Remember, she DOES have a boyfriend/future hubby. Because if she can cover all living expenses on her own, then every after-tax dollar he earns can go towards debt repayment/retirement savings. So basically, their retirement plan hinges completely on him. No pressure, buddy 🙂

But first, the idea of working part-time isn’t going to work. None of this 35 hours a week, 40 weeks a year BS. You just got out of school and you’re thinking of working part-time to travel already? You can think about doing that when you have maybe a couple hundred thousand socked away, but right now you 2 have no money and a bunch of debt. You’re gonna have to work the salt mines full-time like the rest of us.

So assuming he works full time at $15 an hour, he’d make $31,200 pre-tax. The first few years should be spent using that money to clear off the debt. Credit card debt first, then his student loan, then AB’s student loan. After that, you can start contributing to both of your 401(k) plans and to reduce your tax burden. This would bring your after-tax earnings to $78k, and your savings rate from 0% to a respectable 40%.

Your FI number would be $47,400 x 25 = $1,185,000.

And how long would it take to get there?

YearBalanceSavingsPortfolio GrowthTotal

21 years. Which, after adding the 3 years it would take to pay off the loan, means she can retire at 47. So not in your 30’s, but in your 40’s, which is already pretty good considering most people retire in their 60’s.

And again, this whole thing hinges on the boyfriend’s/husband’s earnings. If you were to find just $500 a month of expenses to cut, and his earnings were to rise to match yours, it would slash 8 years off your retirement and then you’d both be able to retire in your 30’s. And then you can ride off in your truck to explore the Alaskan wilderness all you want.

Okay, let’s open the floor up to our intrepid readers. What do you guys think? Am I putting too much pressure on AB’s boyfriend? Or am not putting ENOUGH? I think I’m not putting enough.

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79 thoughts on “Friday Reader Case: Moving to Alaska. Should I Buy A House?”

  1. I’m (obviously) not familiar with Alaska but that seems an abnormally high rent to me. $2,100 to live in the middle of nowhere? In a place that charges no property tax? I thought the point of living in these places was it’s cheap and you can save a lot. I don’t see much of an upside on moving to the middle of nowhere on that salary with those kind of living costs.

    Our downtown Vancouver apartment is less than that, in one of the most expensive housing areas in the world. Perhaps they are choosing a more luxurious rental?

    Anyway, the whole move seems a questionable idea to me. There are much cheaper (and less remote!) places to live in the US than that. What’s the job prospects of the husband in a remote location too? He might find it easier to become employed in a less remote location, like, ANYWHERE ELSE!

      1. She did say rent “PLUS UTILITIES” is $2100 – I’m guessing due to the climate and remoteness that the utilities could be a much larger than usual portion of that total monthly housing cost estimate. And she did say “house” which sounds pricey, but depending on where she is there may be no apartments. I’m from a fairly rural area in Alabama and there were precious few if any multifamily buildings. Everyone lived in houses or trailers.

        Given the home price she’s citing is $120K, I understand her argument for buying. The mortgage on that is likely to be cheaper than rent (or very close to it), and a lot of that payment will go to build equity not just to the bank. But that’s assuming you’ll be there AT LEAST five years – closing costs are crazy and demand is iffy at best so selling could be dicey. I agree with you that it makes sense to rent for a year FOR SURE to save a little money and also make sure that you don’t totally hate life in Alaska.

        And if they DO plan to spend the summers traveling then buying makes even less sense. Homes vacant for months are hard to insure, and you’ll be paying for a house you only use 3/4 of every year. Better to rent month to month if possible during the school year and peace out in the summers.

        But yeah taking this job doesn’t really sound like it makes sense unless they just have a dream of living in Alaska. $58K sounds like a lot for a new graduate, and yeah it’s way more than teachers make starting out in most places. But it puts her husband on track to earn only $21k by her estimate. If they stay in the continental US they could both launch careers (he could even start a business), and in 5 years they both have a good shot of earning really good money – versus her current plan which in 5 years entails them starting over somewhere with him having basically no resume.

        PS do the math on the truck barge plan…paying thousands to ship a car only worth $3000 probably doesn’t make sense. Could you sell the truck, save the barge fee and just buy another $3000 truck there? Probably lots of autos end up there because people don’t want to pay to send them back.

  2. I did a bit of googling. I guessed that Alaska bound is planning on teaching on Kodiak Island, though there are other places she might be going. According to Trulia, it’s possible to find one bedroom apartments for around $1200, and if she and her fiance can squeeze into a Studio, they can rent for $950. For what it’s worth, my family lives in a 2 BR in San Diego—in the 18 months we’ve been here, we have yet to run the heat and only rarely run the A/C—and we pay less than what she expects to pay to live in the middle of nowhere.

    My advice would be to take only what fits in the truck, and live in as small a place as possible for as long as possible. Also, NO PETS. You can afford one if you have space and cash to spare, and they really don’t. Her estimates for housing seem absurdly high, given how much debt her family has. And her husband-to-be needs to find work, fast.

    1. $950 rent might make the numbers work out better, but not by a lot. If credit card minimums aren’t included in their $2750 number, then they’re back to just barely keeping their head above water.

  3. The wicked high salary is that way for a reason, and unfortunately it ain’t so you can live like royalty your first year out of college. A friend of mine has taught just outside of Anchorage for more than a dozen years and he’s doing alright, but it’s a constant battle; the political and economic systems in place in Alaska really do not lend themselves to treating teachers well. It’s even weirder out west. Here’s the third google hit for this little town that wants to hire a 2nd grade teacher:

    And some reports from on the ground in the ol’ forums:

    Reading these frankly gave me the shivers. AlaskaBound, I’m excited for you and I genuinely hope things go well, but yikes.

    1. That TheAtlantic article was really interesting. No bars? You’re in the middle of nowhere and you’re also not allowed to drink? I’m out.

  4. Are you sure that her rent (or mortgage payment) wasn’t included in the monthly family spending estimate? It seems that she would have at least run these numbers initially before accepting the job.

    1. Yes that is a good point, it is more helpful to understand when the readers detail their monthly spending in the letters. I think some people might not want to do this though because some of the comments can get pretty vicious when people reveal how much they are spending on entertainment, food or “misc expenses”

    2. I thought about that, but then that means she’d be expecting to live on just $900 a month for 2 people. That’s a stretch even for me.

  5. I don’ t know the Alaska market at all but the rent seems high (even with utilities included) compare to the cost of a house, sounds like it may be a great place to own rental properties!
    I agree with the “don’t move there” but looks like it is already done. I read the case several times and didn’t see anywhere how she plans to get a mortgage , how much of a down payment she would have (and from where since they have no saving) and what the interest rate would be. Interest expenses need to be added to her analysis. Also variable cost of home ownership should not be underestimated. $20K just for fun may actually not be enough. (Did it include lawyers’ fees for both transactions? Other closing costs?). Where did the utilities get added and is it also more expensive there?

    1. I’m not so sure. I think the biggest challenge with this place might not be financial, it might just be adjusting to the lifestyle. I would go batty within a week.

  6. For teachers, its better to have a low salary in a low cost of living location. You will net more money and have relatively higher purchasing power. The cost of living will rise with inflation automatically while teachers salary may not. Texas is a great option.

    High cost living places like Alaska or New York City (where I live) only make sense if your in a high paying industry that more than compensates for getting your face ripped off on rent.

    And when states have no income tax they just make up that money somewhere else.

  7. The whole “working part-time so we could travel around during my time off” was enough to see that they’re not serious about early retirement. The boyfriend/husband should be busting his ass full-time, and she should be finding another job when school’s out in the summer, in order to pay down the debt ASAP and to start maximizing their saving/investing rates in the near future.

    1. Yeah I was like “you just got out of school and you’re already thinking of taking a break? Get your ass in gear like the rest of us!”

  8. Don’t buy… no matter what… you will only be there 1 year at most and then be gone. Correct me if I am off, but your fresh out of school, and this is the only teaching job you can find, correct? Have you ever lived in a place like this, no Starbucks, no WiFI, a car is a luxury item, and gas is grossly expensive. They make you sign a one year contract, and by the end of it, you will be begging to get the hell out of there…

    My ex got her teaching degree, moved to a small village in BC Canada, after a week she called me balling her eyes out, the kids were monsters, and the living conditions sucked… and it wasn’t even winter yet. She was stuck there as she had signed a contract. I found someone else, as there was no way I was going to follow her, after telling her not to take the job.

    This place is a Shit Hole… Your boyfriend will dump you and exit stage left in a matter of months…

    1. This comment was so harsh…but it’s the same story I’ve heard from many others. They were nurses that moved to Alaska to work. Signed contracts, which they eventually paid to break. They were physically assaulted by patients, far away from home, and boyfriends left.

      Visiting Alaska is on my list of things to do. Living there, never! I’ve heard nothing but horror stories from Americans from the mainland who’ve tried.

      1. Holy shit. Is Alaska really that bad? Maybe that’s why the housing prices are so depressed.

        …but then why is the rent so high?!?

        Maybe everyone just gets eaten by polar bears eventually.

        Hey! This is the first time I was able to make fun of somewhere ELSE for being a frozen wasteland! Yaaaaay!

        1. Yes, it’s really like that. Some people love that isolated lifestyle — the hunting, the fishing, the lack of modern niceties like … err … roads.

          Most people end up owning expensive “toys” like boats, planes, and snowmobiles to get around and enjoy these outdoor activities.

          The whole “high Alaska salary” thing is a wolf in sheep’s clothing. They pay more because it’s so expensive to live there.

          It used to be that Alaska would even pay you a dividend for living there, but these days with oil prices being low I think those payments are much smaller.

          Don’t even get me started on the mosquitoes…

          1. Is $58k considered a high salary here? Maybe it’s from my tech background, but if you doubled that to try to entice me to go to Alaska, I still wouldn’t.

            Also, mosquitoes?!? I’m out.

    2. “no Starbucks, no WiFI, a car is a luxury item, and gas is grossly expensive” Sounds a lot like the place I live other than the part about cars that was mentioned in that article someone posted. We have one grocery store with everything marketed up 25% from the prices at the nearest city and gas is about $1.60/L, 30 cents more than the nearest city. I’m guessing by WiFi you mean public WiFi and those hotspots are very limited here.

      For the most part I am fine with those conditions (and could easily get by without owning a car), no one wants to pay more for food/gas but as my rent is very low it makes up for it. I work from home and only leave the house about once a week so public WiFi isn’t an issue.

      I lived in Metro Vancouver for 25 years before I came out here and being in a secluded place doesn’t bother me at all as I didn’t take advantage of the “perks” of living in the city when I lived there. It can be an ok place to live for the right kind of person, the main problem I see with this case is the high cost of living. I moved here because of a unique opportunity for cheap rent which actually brought my cost of living way down, where this person is moving to the middle of nowhere and paying out the ass because of it.

      1. …yeah. As I read more about Alaska it sounds like all the worst parts of every city I hate rolled into one. The walkability of LA, the rental costs of NYC, plus the food scene/cost of groceries of the Yukon, plus the job prospects of SmallTown, USA.


  9. Are you sure the rent isn’t included in her monthly number? She says she’d be able to save some money by moving so I’m thinking it is.

  10. I had to google bethel, alaska and one of the first things I read was that most people don’t even own cars there but they do have taxis. Get rid of the car? Your bf’s prospect of finding a mechanic job is pretty slim. I just don’t see this happening. Better off finding a local teaching position in your area and live separately or with parents if possible.

  11. “Cars, even used ones, are out of the price range of many people living in Bethel, and even if you buy one, gas currently costs $6 a gallon.

    Instead, just about everyone in town depends on taxis or their own two feet to get around. There are about 70 taxi drivers in Bethel, one for every 85 people, making it the city in America with the most taxis per capita.”

    1. This seems like a very expensive place to move to! I don’t understand the value proposition, so I hope it works out for her…

    2. My God. I wonder if she has even looked at this qualitatively? It sounds like a living nightmare of a place to live. No public transit, $6 gas, 23% of people living below the poverty line…I can only imagine what the education system is like there. People moving house by carrying their belongings in garbage cans across the town. No clothing stores(!), book stores, bars or anywhere that sells liquor. The only way to entertain yourself is to fly out of the town somewhere else. I can only imagine what the winters are like. All of this for an enormous cost of living and average wage?

      As much as your initial comment seemed harsh, I can definitely see it coming true! Where is the positive in this “opportunity”? I see only negatives.

      I hope to God she hasn’t already committed to this hellhole.

      1. She should also take a read through of your website Money Miser. I’ve enjoyed the articles that you have posted there.

        But to your comment above, after reading that article, and just generally knowing the geographical location of this place… I would give this “opportunity” a pass. She could make more with a side hustle + teacher’s salary somewhere in the continental US I would imagine.

        1. Thanks man! It’s nice to get some feedback on the blog. It can be a bit of a struggle when you feel like nobody is reading haha.

          Unfortunately I just re-read the case above it sounds like she has already accepted the offer and started making preparations for moving. Might be no turning back at this point…

    3. Taxis are $5, and the town only has a few miles of paved road. You don’t need a car, and its actually a huge liability here. Restaurants are open late and deliver, though prices are high. Rent is about $900 to $1200 for a 2 bedroom apartment, though your water comes from a tank. Work pays very well, and state jobs have a 50% cost of living differential added to the hourly rate. Its not for everyone, but if you know what you’re getting into it can be very rewarding.


    Live Well Within Your Means

    Now its your turn to beat me up… yep, got my own blog…

    FC, punt this if you don’t like selfless promotion, but I do this to help people…
    On one day I am coming to Chatanuga… Chataruagwa, Chawagawi… whats it called ?

    1. Just a tip, rather than just copying your blog into a comment, change your name to your blog name and add a website link. That way anybody can just click your name and go straight to your blog. Most people do this and I think most bloggers are fine with it (other than Garth, who can be a bit of a miserable old fart with that kind of thing). You might also want to set up a gravatar etc.

    2. I don’t like shameless self promotion? Have you met…me?

      And yes please do come to Chautauqua. Best week ever! (I didn’t pick the name, blame JLCollins)

  13. How about her massive equity/return miscalculation with regard to the home purchase? If there’s 126k in Monopoly money available for a house, then a fair comparison is [rent + invest 126k in a basket of cheap ETFs] vs. [buy crackerbox shack, invest nothing, have property taxes/insurance/maintenance/utilities cost siphoned out through bodily orifices]. I guarantee the expected value of option (1) exceeds that of option (2), although I’m too lazy to go through the math at this particular moment.

    On a related note, the round-trip transaction costs of buying/selling a house in five years tosses that option right off the table without any real analysis. I guaran-damn-tee it.

    1. Yeah normally I’d run the math but it’s a moot point. She herself is planning on leaving in 5 years, so it makes no sense to buy. And from the comments here, she may not even make it to the end of her first year before she attempts to run screaming from the “hellhole” that is Alaska.

      Money Miser’s words, not mine.

  14. She can get a 0% down loan in Alaska because it’s rural (Look up USDA loans). That said, I would do some quick math on utilities because $2100 per month actually sounds like it might be a decent deal since utilities in the hinterland are expensive.

    I think in Alaska, she and the BF will also get a tax credit, so she’ll come out way ahead financially.

    1. Yeah 0% down loans allowing people with no money and no money management skills to get into more debt than they’d normally be allowed to. Great idea. I can’t think of any case where THAT’s gone wrong before.

  15. Need to get Ed the Millionaire Educator on the spot ( He was making more than $58k in the middle of bumfcuk Georgia where rent was something stupid like $600/month. And everything is dirt cheap because there’s plenty of Walmarts everywhere. So that’s the story of how me made his million as a teacher and it didn’t involve $2100/month rent.

    Though that rent figure is astounding assuming there’s a $126k house available somewhere up there. Seems like a strong case for buy over rent given the high rent. Maybe that’s a short term rental situation so it’s much higher than what a long term lease would be.

  16. Hi Guys, I saw the M.E. light shining in the night sky, so I’m here to add my two cents. Alaska sounds like quite an adventure, but those debt and cost-of-living numbers scare the crap out of me. First, you guys need to HAMMER that credit card debt tout suite. There should be no talk of part-time anything until that debt load is nuked; that goes for the student loans too. Second, if you two plan on spending an awesome life together, you need to work together on your collective finances. There is no his-and-her debt when you’re married. You need to be on the same page if you’re going to pay off your debt and eventually FIRE.

    Third, if it’s not too late, you might want to consider a low-cost state in the Midwest or South. My wife and I did well in Georgia where teaching salaries are higher than neighboring states. At our last job in Douglas, GA we paid $500 a month for a 2/1.5 townhouse with a pool. Utilities were about $125 a month and our total monthly living expenses were about $1,500 FOR EVERYTHING. Think about that $18k a year to live in the U.S.

    Coffee County has an elementary teaching vacancy right now: ( Look under “Coffee County”) There are jobs popping up in Georgia all that time; book mark that website if you’re interested.

    If you want to buy a home at some point, there are bargains to be found in “Flyover Country” because not many people move small town America due to the limited economic opportunities (complete myth if you ask me). We’re currently in the process of buying a 1600 sq. ft., 3/2 brick ranch for $68k in south GA. (FIREcracker and Wander, please don’t be mad at me!)

    Our financial success came from our low-cost of living set-ups coupled with crazy hardcore savings in our 403b, 457, IRA and HSA accounts. Some years we managed to save over $100k a year on our two teaching salaries. If you take care of your debt and live in an inexpensive part of the U.S., you will eventually be able to work your own hardcore savings magic. (Trust me, it DOES feels magical when you save $500k in 4.5 years like my wife and I did.)

    Once you slay your debt and build some wealth, you can then take a teaching job wherever you want because money will be a secondary or tertiary concern. However, right now getting out of debt is priority number one. Email me if you ever need my input. Good luck guys! Ed

    1. You bought a townhouse for $68k with $1M in the bank? Why in the Hell would I be mad at you?

      I salute you, you magnificent bastard!

  17. Her numbers for the mortgage don’t make any sense. You’re going to *buy a house for $126k? If that’s the case your monthly payment will be minimal (about $600/month). But maybe she was saying she will buy a house where the payments will work out to be 126k over five years. But then the house would cost about 450k. Which doesn’t make sense because she mentions selling it for $115k. I just hope she’s not teaching maths or finance.

  18. Every dollar I have earned for the last 12+ years has been in the NWT and Nunavut. Living costs are crazy. A friend of mine calculated that he will spend 3 years gross salary more on electricity than I will (because I’m on a rotation) over our lifetimes…He seriously spends 10x what I do on electricity. Food is very expensive and selection may be mediocre at best. Check the best before on anything with a price that is too good to be true. The next thing is finding companies that will ship to you for free…but they usually catch on to the outrageous shipping charges and exclude your zip code or your state. How big is this town? Is the barge service seasonal or year round? Just the shipping costs on parts for your vehicle will be expensive and it’s quite posible the roads in this town will destroy your vehicle. I’m presently writing this from a town where I can take a cab for 7$/ person anywhere in town. Maintaining a house will be crazy expensive. I would be very hesitant to buy a house in such a stagnant market. Maintaining the house while you try to sell could be very stressful…and yes many people leave within their first year or two. If this job is gateway to your career I’d take it….but don’t count on it as a retirement gig.

    1. Yeah, but did your salary at least compensate for the higher living costs? I know people who worked in the North and the government subsidized their rents and groceries and such.

      1. My first job didn’t but was a gateway into an industry. Every job after that my employer owned or provided my accommodations and presently I receive 100$ tax free per day for food when at work…and this is less than what the government gives their staff when travelling in the NWT and Nunavut.

  19. Her numbers seem out of whack. And it’s not smart to bring the vehicle. A small community everything’s prob within a 10min walk. Or buy a clunker in town if you need it. And hubby definitely needs a job or I doubt they’ll make it. Are they prepared for the mental stress of living in an isolated communty?

    But for comparison sake, I moved to Nunavut and bought a house. I wasn’t a teacher (they are provided subsidized housing here). We bought because renting was going to be 3100+ utilities (at approx 1000/month). We were able to get a house for 315,000. The thing to remember with these small communities is that there is no “market”. Even when things “crash” elsewhere people in these communities still need houses, and the housing stock is generally the same year to year. Very unlikely for your house to loose value, even as it ages. It’s a very different world than large cities. There’s no eating out budget there’s no where to go. No entertainment budget there’s nothing to do. 🙂

    1. “There’s no eating out budget there’s no where to go. No entertainment budget there’s nothing to do.”

      That’s a…unique way of looking at the budget. Never thought of that.

      That being said, I am more and more convinced I would go batty in a place like that. I can’t even stand being in the suburbs for more than 2 weeks cause there’s nothing to do up here!

  20. I’ve been working in remote areas of Canada for the better part of 10 years as a nurse. The north is definitely not for everyone, so buying a house is nothing short of insane. You need to try out your community for awhile to see if it (and the north in general) is a good fit for you. Rent at 2100 including utilities is not at all outrageous. It’s cold. It costs money to heat (from late Sept to potentially May or June. Seriously). That said, does the employer offer some sort of subsidized housing? This is almost always available for teachers/nurses/cops in northern Canada.

    1. Right. I know from friends that worked in Nunavut that there’s often government subsidies to entice you to go. Haven’t heard anything from that from AB though…

  21. I’m with BO on this one – they aren’t serious about FI. I’m not trying to bring people down but w/ these expectations (house buying, vacationing without current employment while working 40 weeks a year, etc) it’ll never happen. First off , as soon as I saw the pre-tax income, I knew it was over – even with tax credits etc. they will be working their way out of debt for years. I think this move is a bad idea, stay in the continental 48 and come up with a new plan. Maybe just focus on killing debt first and getting some FU money saved up.

    Also, I have buddy who moved to Alaska with his wife and loves it. But he’s in the military and is a real outdoors-man (camps, fishes, hunts [cleans and cooks his kills]). They love it up there but its definitely not for everyone.

    1. Oh yeah, I can see this working if you’re one of those “commune with nature live off the land” kind of people. I supposed grocery money might go down if you can catch/skin a wolf yourself, but I’m gonna go ahead and declare that “outside my area of expertise.”

      *munches on instant noodles*

  22. Wow, harsh comments! Living in a remote, high-cost location does not work for everyone, but for some it does – I’ve been living in a fly-in only community in the Canadian Arctic for more than 10 years now, so it can be done. I’d have to guess she’s aware already that there’s no starbucks, cell service, or whatever and can live with it. I’m surprised no one suggested finding a room mate… if she is intending to rent a house, they may be able to take in another newcomer and split the rent.

    She’s presumably not been to Alaska and doesn’t know how she’ll actually take to it, so best to plan for 1 year first, pay down some debts and build experience and take it from there. Nothing ventured nothing gained.

    1. A roommate may not be a bad idea. I hadn’t thought of that.

      But yeah let’s see if she can survive just the first year first. It sounds…rough.

  23. Chiming in from Anchorage. Alaska is getting a bad name here. Anchorage is awesome! Anchorage, however, is not rural Alaska. Bethel is REMOTE! Off the road system. Milk is like $10. Alaska’s economy is also not doing well which leads me to “don’t buy.” You may not be about to get off the home AT ALL when you move. You will get the PFD, however if you stay for over one calendar year which is about $1000 each for you and your husband, so that’s a perk. But rural Alaska is rough. You’ll most likely spend your money on flying out when you can.

  24. OK. As someone who used to live for ten years in northern Alaska, I feel it’s my duty to chime in. But first I need to grab a drink – hold on.
    I’m gonna break this down list-style.

    1. Your boyfriend. Moving to Alaska sounds all well and good (especially with enticing images like on this blog post), but Bethel isn’t like that. It’s flat, boring, cold, rainy, and as some have mentioned, many people live below the poverty line. My old coworker from Bethel used to run a grocery store/restaurant there where you could grab a burger, but only if you phoned her an hour before to see if she felt like cooking. Most people go to Alaska thinking it’ll be one way, and find out very quickly it’s not. I moved there at age 18 and I loved it. I wish I was there now. But my husband hated it, and so now we’re in Colorado.

    2. Utilities. You didn’t factor utilities into your homeownership costs – that’s why your rent (With utilities included) is so much higher. We spent about $2,500 per year in fuel, on top of regular $200/month electricity charges. There is no municipal water system or wells. You get a big tank outside your house that you fill with water, or pay someone to do it for $100/month or so – and that’s IF you have running water. I spent my first five years in Fairbanks with an outhouse, a bucket under a sink, an aquatainer, and buns of steel.

    3. Home maintenance. Take whatever you think you will spend on maintenance, and triple it. Housing codes are very lax, and most people don’t follow them. There is an entire culture of DIY people up there holding everything in the town together with duct tape and well-wishes. Our house in Fairbanks had been built with a former septic tank as our drinking water tank, and we spent $30,000 over two years on repairs alone. More here:

    4. Selling your home. You can probably forget about doing this easily, regardless of what the realtor tells you. We tried selling our home for two years after we left. We finally had to give it up through a deed-in-lieu of foreclosure because we couldn’t afford the upkeep on it while we waited for someone to buy it. We won’t recover from that credit hit for another six years.

    5. Cost of living. Utilities aside, everything there costs an astronomical amount. Every last little nail and cucumber is flown in by airplane or shipped in by barge. All the produce is old. Here are some prices you can expect (courtesy of this site: $7.00 for a dozen eggs, $12.00 for a gallon of milk, and $6.00 for a loaf of bread.

    6. Your boyfriend’s job. He MAY be able to get a job there as a mechanic, but seeing as how almost no one owns cars there and there’s only 6,000 people in town, it’s a long shot at best. There are mechanics there, but whether or not a position is currently open when you get there is another story. He’ll quite likely have to get whatever random job is open at the time.

    7. Side hustles. You WILL need to do a side hustle, but don’t expect to do it locally since so many other people are impoverished. You’ll need to do it online.

    8. Health costs. You’ll need to take Vitamin D supplements since your skin will be covered for 99.96% of the year. Even then, Alaska has some of the highest rates of Seasonal Affective Disorder (SAD – which as a writer, is oddly an acronym that makes me happy) in the world. Many Alaskans even use special day lamps during the winter (collectively known as “happy lamps”). There is also rampant alcoholism in these communities, regardless of whether the village government has voted it a dry village or not. Also, lots of calamine lotion. Gallons of it. The mosquitoes are so thick on the tundra that they’ve actually blocked my vision looking out of a bug net.

    All of this sounds pretty harsh, especially coming from me. I love Alaska. I’m the type of girl who loves remoteness. Plop me down somewhere on the Kenai peninsula with a smokin’ hot internet connection, a fishing pole, a gun, and a cabin, and I’d be a happy camper. But Bethel? Nah.

  25. I also live in Alaska. It’s an amazing state and I love it! If your goal is optimizing your timeline to FI, however, this is not a good plan. Find a way out. But, if your dream is to experience what it’s like to live as a minority in a remote village, go for it. With the right attitude, teaching in Bethel will be very rewarding and challenging. Embrace the positive and don’t listen to the haters!

    My advice if you are committed: ditch the truck. If, after a year, you insist on having a motor for transportation, use the money saved to buy a snowmachine or boat. Don’t worry about buying vs. renting until you’ve been there for a year. You’ll quickly learn it’s not a normal market. Like Maggie said, it’s easy to spend a lot of money getting in and out of remote Alaska. Understand the power of Alaska Airline miles for getting to/from Anchorage. Do everything you can to find mechanic (or any) work for him as soon as possible. With motivation, you’ll find something. If unemployment persists, it will be a strain on more than just your finances.

    1. I agree! While I did give Bethel a lot of shit in my post above, I don’t think it’d be a totally bad experience living there if AB just wants to experience a totally different way of living.
      But, I think she’d have to choose one or another: FI or Alaska. It sounds like she’s more interested in FI than living in Bethel for Bethel’s sake. Choosing Bethel sounds like she’d basically have to give up her FI dream.

  26. She would be much better off if she took a job in a place like Las Vegas or other fast growing districts. My brother teaches there and the cost of living has gotten worse, but is a lot less than Alaska. The salary would be around 50k and her boyfriend/husband could easily find a job. Considering that Clark County is one of the fastest growing school districts in the country she could easily find a job there. My brother got a signing bonus for coming there. Also, they are looking for teachers in Pennsylvania as well (and other places).

  27. Teach abroad at an international school. I think there was a case study on a guy in Korea. My wife and I taught in Taiwan and saved about %50 each of our 20k a year salaries. (Not much money, but cost of living was cheap! and fucking awesome!).

    I heard of folks making good western salaries at international schools in the Middle East (Emirates, Saudi, Egypt)… And other parts of Asia. Usually with provided housing…

  28. People always talk about teaching in Japan, but Taiwan is much cheaper to live, and the Taiwanese treat you like a king. My wife is Taiwanese, and I can work on a spousal visa because she has National status.

    The south is even cheaper to live than Taipei, Chiayi or Kaoshiang are great places to work.


  29. I used to live in Yellowknife nwt. A one bedroom in a little bit of an older apartment building goes for around 1250 CAD there. 2100 is indeed for single family homes. A basement suite can be as cheap as 800 CAD. I’m not entirely familiar with the education system, but I thought most teachers in Yellowknife would make around 70000-80000. All in it’s definitely worth it to properly run the numbers. Free house sitting is also quite big in these places. Utilities should be included in the rent. At least heating. Electricity and water might be separate , but should not cost more than 100 a month. Internet is expensive and a decent package is around 80 a month. Hope this helps.

    1. This is what I figured…for that cost of living to work, the pay should be $70-80K, but in Alaska, they’re only offering her $58K. Thanks for sharing your numbers!

  30. Wow… So much hate for AK tsk tsk tsk you guys privilege much?

    First off, teacher salaries in rural Alaska (like Bethel) are roughly $10k more than in Anchorage. And, teachers DO NOT PAY SOCIAL SECURITY TAX (they also do not have to pay into the state unemployment fund), which brings your total payroll tax for $58k to $841.00 for the whole year. Income tax will be around $7k for the year, but will be lowered by your health insurance contributions as well as possible retirement contributions? (please do your own calc since you’ve started somewhere in the middle of this year)

    Second, oh we so do have property tax. Some counties also have sales tax :O

    Third, you will not find a property for $120k that is not falling apart – so yes, you have to rent. Ask your principal, usually word of mouth will substitute you the craigslist. Facebook is pretty active too.

    4. Try your hardest at this job, there are a huge amount of conferences or sport or other events when school will fly you to Anchorage, provide accommodation, meals, you’ll have some play time (aka go to Costco and buy fruits and cheeses time – man, pizza in rural areas is around $30-$40)

    5. Tax tip for a teacher – track you monies you will spend on kiddos (and you will spend on kiddos), up to $500 is deductible above the line – not a lot but hey!

    6. Children are not monsters, please remember that.

    7. There’s a huge drug problem in rural Alaska, don’t be surprised to find out some of your kids’ parents might be dealing.

    8. If that man of yours is adequate and good and is not gonna make more than $16k this year – marry that man. For tax purposes! IRS considers you legally married if on 12/31 of the tax year you are legally married. So do your tax calc before you elope.

    9. In some areas high school kids make around $25 an hour fishing, granted – they can fish (granted – probably not in Bethel).

    10. Rural schools are pretty used to teachers breaking their contracts and leaving in the middle of the school year (I think this is extremely sad), I don’t know the repercussions though…

    11. Keep your mind and heart open, maybe you’ll fall in love with this place?

    1. Oh good, someone on the opposite side who’s actually defending Alaska! *phew* it was looking WAY too one sided for a while there. Thanks for your 2 cents!

  31. I currently live in Seward, and have worked and lived in Bethel periodically. Bethel is a bush Alaska community that serves as a hub for several extremely remote Yupik villages on the Kuskokwim river. Picture a miniature, rural, polar New York City on the Alaska tundra. The population is diverse, pay is good, taxis plentiful and cheap (Only $5), and every restaurant is open late and delivers. However, it is a very difficult place to adjust to for most. Prices are high because all goods have to be flown in or barged up. There are only a few miles of paved road. Crime is high, and alcoholism and sexual abuse run rampant. Sewer pipes run above ground because of permafrost. Water is bottled, and indoor plumbing is a luxury. The tundra is windswept, cold, dirty, and often featureless. As someone who lives in rural Alaska, I’ve noticed a disturbing trend of unprepared people moving here chasing dreams of easy money only to find themselves disillusioned and financially ruined, most of them having visited only on a cruise or taking TV knowledge as gospel. This is not the lower 48. Before you move here, visit in the winter, work a seasonal job in the bush, do extensive research. If you move to Bethel, ditch your car. Rent. Build relationships with the people, particularly the natives. Most of all, GO THERE FIRST. Bush Alaska can be rewarding, but you need to know if its right for you.

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