“Dad, I keep hearing it’s insanely expensive to live in Palo Alto.”
“Yep.”
“How much does it cost?”
“Hmmm, I’m not sure where to start. Trust me. It costs a lot.”
“How much more expensive is it than living elsewhere?”
“Ummm… I have no idea.”
That’s a missed opportunity. You want your kids to have a clue about how much things cost. It’s a key part of understanding the value of a dollar.
So, next time the topic comes up, jump on a browser and visit numbeo.com. It’s a crowd sourced treasure trove of cost-of-living stats from around the world.
Type in your city. Palo Alto, California in my case. See what the crowd cites as the average price for everything from a head of lettuce ($3.00) to a gallon of gas ($3.11) to the monthly basic utility bill for a 915 square foot apartment ($137.22). On the income side, you can see the average monthly salary ($6.500).
So how does that compare to, say, Des Moines, Iowa? Look for the comparison field toward the top and type in Des Moines.
That head of lettuce in Des Moines? Just $1.76. Gallon of gas? Just $2.19. Utility bill? $114.26.
In the summary indices section near the top, you’ll see that rent in Palo Alto is 228.9% higher than Des Moines. Restaurant prices? 13.6% higher. Groceries? 6.8% higher.
Note, however, the average monthly disposable salary is also higher in Palo Alto — by 203%.
Maybe you should encourage your kid to learn to code and move to Des Moines to optimize that delta between expenses and wages!
Take some time to explore comparisons between your city and others in the US. Try other countries too. (Rent prices are 1,082% higher in Palo Alto than in Bangalore, India!)
Numbeo is a fun way to give your kid a clue about how much life costs — at home and elsewhere.
P.S. Is Numbeo accurate? Hard to say, but if it’s even remotely in the ballpark, your kid will gain some valuable perspective. Ready for the next step? Try this reimbursement strategy to let your kid experience the numbers directly.
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