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Leaving California and Moving to Idaho

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If you’re here for the free download detailing what not to do during a moving from California to Idaho, you can download it by clicking the image below!

Hey everybody Treasure Valley Dave here! People leaving California and Moving to Idaho has been a hot topic for a while now and I wanted to talk about why that is happening. Maybe the reason people are leaving California is obvious to you, but to others it might not be. Either way, I’m sure that you will find the information here worth your time, so let’s jump right in!

Why People Are Leaving California?

It’s no secret that citizens of the Golden State are packing their bags and calling it quits. CNBC Reports that 360,000 people left California in 2021 because of the availability for remote work and cheaper housing. While that may be true, not one of the dozens of clients that we have helped during that same time period cited, “remote work in Idaho” as a motivation for them to leave California. What did? Here’s a short list of the most common reasons we found that people have left California and moved to Idaho.

  • Politics
  • Taxes
  • Cost of Living
  • Crime

Politics

California has been a “Blue” state since 1992. The disparity between Red Voters and Blue Voters became even larger in the 2008 election when Obama was elected President of the United States and it hasn’t changed much since.

While California may not be a “conservative” state, the citizens have still voiced some concerns regarding some of the state’s policies according to PPIC.org:

  • Most Californians from coast to interior feel their taxes are too high, and Californians almost everywhere believe immigrants are a benefit to the state.
  • Concern about the cost of housing shows sharp divides between the coast and the interior, though Californians are concerned in most parts of the state.
  • Support for the Affordable Care Act (Obamacare) is lukewarm in most places.

 

You can watch Dave Edwards cover some of the politics in California below if you like.

Most recently, with the November 2022 Elections, little if anything has changed. Actually, if there has been a change, it’s that the leadership of the state leans even more left now that the election is over than it did before.

Here is the political leadership as the state sits right now:

The state is led by a Democratic Governor, Gavin Newsom and Alex Padilla, a Democrat, represents the state in Washington D.C.. The state’s senate has 21 Democrats and 6 Republicans and the state’s assembly has 27 Democrats and 8 Republicans.

You can see that the state is overwhelmingly run by democrats and it appears that won’t be changing any time soon.

Taxes

Another commonly cited reason for leaving California is heavy taxation. Using Gusto.com’s Hourly Paycheck Calculator, let’s calculate how much money someone will take home while living in California.

leaving-california-and-moving-to-idaho
Gusto.com

I said that I was making $25 an hour, that I get paid every two weeks, and was married.

Income taxes were calculated at 9.71% and FICA taxes were calculated at 7.65%. After taxes my take home pay was $1,652.72. 

It starts getting a little more complex when you start looking at the taxes that a business will have to pay. We recommend this breakdown by Legalzoom to understand it all. But what we did find interesting was how California’s government found a way to tax business owners of LLCs not just once, but twice each year.

If an LLC has a net taxable income they can elect to pay the Corporate Tax, which is 8.84% of their annual earnings.

If an LLC does not have a net taxable income they must pay the Corporate Alternative Minimum Tax which 6.65%

Regardless of how the LLC files above, all LLCs must pay a Franchise tax, which is $800 or 1.5% of their net income, whichever is larger.

At a glance the taxes may not seem so bad. You make $2,000 every two weeks and you take home $1.652. That’s not terrible, that’s $3,338 a month. Here’s the thing though. We haven’t even gotten into cost of living yet. Which is what we’re about to do right now.

Cost of Living

Beautiful beaches, scenic mountains, endless deserts, bold mountains, and towering redwoods, California really does have it all. But you’re going to pay for it.

Under the Taxes section we calculated that if you made $4,000 a month you would take home around $3,338.71 living in California after taxes.

Now, what about all of our living expenses? How much do those cost? Well, they cost enough to make people leave the state. Let’s do some research and let’s find out.

You have to have somewhere to live so let’s start with that. Let’s say you live in Sacramento, California, and you live within your means and have a one bedroom apartment.

We found a cheap apartment for $1,695 so let’s deduct that from our $3,338.71.

Our remaining funds after paying rent are $1,653.71.

Now let’s pay our utilities.

We did a Google search to find out how much the average power bill is each month. However, we hear that this number is much higher than reported here:

“In Sacramento, CA, the average monthly electric bill for residential consumers is $164/month, which is calculated by multiplying the average monthly consumption by the average electric rate: 876 kWh * 19 ¢/kWh”.- EnergySage

Moving on to Water, Sewer, and Trash.

This redditor living in Sacramento said, “Our 2 Bedroom house is $170 a month. The variables you can control are the size of your trash cans and the amount of water you use (we haven’t switched over over to a meter yet so it’s based on # of rooms). The rest are fixed costs (sewer & storm water, street sweeping). With smaller trash cans and reasonable water usage you should be below $150”.

Now, after deducting our utilities we are left with $1,319.71.

The Bureau of Economic Analysis estimates that in California the average person spends $302.50 on food monthly. Remember, I said I was married so that means I am feeding at least two people so we need to multiply that by 2: $605

We are left with $714.71.

Now, I drive to work so I need to factor-in gas, car insurance, and registration.
Financebuzz.com states that California residents spend 3.72% of their annual income on gas each year. Before taxes we made $48,000 each year.

3.72% of $48,000 = $1,785.60 (annually) we then need to divide this number by 12 to get the average amount spent on fuel. $1,785.60/12= $148.80 which we then deduct from our remaining $714.71 budget.

We are left with $565.91.

Now we need to pay our registration for the year.

I don’t currently live in California so I wasn’t sure how much registration would be. This was how much it cost me to register my new vehicle online:

leaving-california-and-moving-to-idaho

Now I need to deduct my registration fee of $521.00 from my budget.

$565.91 – $521.00 = $44.91

In order to drive legally and safely on the roads I need to make sure that I have car insurance. This annual car insurance calculator estimated that the lowest I would pay with Progressive would be $596. Let’s get that into monthly costs.


$596/12= $49.60 which leaves us at a balance of -$4.69


We haven’t even added in our cell phone bill yet, paid our health insurance, budgeted for anything fun, or even set aside anything for savings.

At the beginning of our Cost of Living assessment I said that I was making $25 an hour and filing married.

At this point, I either need to find a higher paying job, which may or may not happen, or my wife will need to go to work. Hopefully we don’t have kids any time soon because that would be an added cost as well!

If you’re living in So-Cal and commute to work, you can attest to the amount of money that comes out of your paycheck just in tolls alone! Before you move onto reading about crime in California, leave a comment below telling me how much you pay in toll fees!

Crime

Another common thing that people express after visiting Idaho was how safe they feel even walking in the heart of Boise’s downtown. Pulling once more from PPIC.org here’s some data on crime in California:

California’s violent crime rate increased by 6.0%, from 440 per 100,000 residents in 2020 to 466 in 2021. While robberies fell somewhat (by 1.9%), aggravated assaults jumped by 8.9%, and homicides and rape increased by 7.7% and 7.9%, respectively.
In 2021, aggravated assaults were 67% of reported violent crimes; 24% were robberies, 8% were rape, and 1% were homicides.
California’s violent crime rate in 2020 (the latest nationwide statistics available) was higher than the national rate of 387 per 100,000 residents and ranked 16th nationwide.

Clearly crime is a factor when it comes to people deciding if they want to stay or leave California, but it’s not like nothing is being done about it.

The state website, cdcr.ca.gov reports, “as of September 14, 2022, the State’s adult prison population is 91,638, occupying 111.8 percent of design capacity”.

Meaning that California’s state prisons are about 11.8% overcrowded.

More than just numbers, it really boils down to how safe people feel, and our clients report feeling overwhelmingly more safe in Idaho than in California.

Interestingly enough, it’s not just individuals that are seeking exodus from California.

Businesses are leaving too.

Why Are Businesses Leaving California?

It probably doesn’t take much to arrive at the conclusion that businesses have left California for some of the reasons listed above. One of the main reasons is most likely the taxes. Remember that whole double tax thing?

Well, let’s look into the business side of things some more. Here are how many businesses left California for the past four years:

2021: 153
2020: 75
2019: 78
2018: 46

We said it had a lot to do with taxes, which we still believe to be true, but look at that spike in departures from 2020 to 2021! Think back to what was going on in the world during that time and you might discover a really big reason why businesses are leaving California.

We could detail the taxation of businesses again, but we wouldn’t want to bore you once more with that information. So let’s jump into some of the crime going on in the Golden State.

Crime

Penal Code 459.5: shoplifting is stealing items valued at under $950 and a misdemeanor crime. Shoplifting is always a misdemeanor crime and punishable by up to six months in a county jail and fine up to $1,000, unless the defendant has one or more prior convictions.

So, if you are someone that wants to risk stealing something, and you want to get the most bang for your buck, you could walk into a store and find something valued at $949.99 and walk out. You might get caught, but you might not. If you do, you only get a $1,000 fine. If you don’t, you get an item worth just $51 shy of $1,000.

Now put yourself in the shoes of a store owner. There’s no possible way that you can catch every single theft. You have to have employees that are willing to care for your items just as much as you are, or you need to hire security.

This has become a widespread problem for store owners, so much so, they had to make a new acronym: ORC.

CS News Reports: “During the economic crisis fueled by the COVID pandemic, ORC was costing the U.S. economy $125.7 billion in lost economic activity. It was also costing federal and state governments roughly $15 billion in tax revenues, money that should be used for infrastructure and public services”.

No wonder businesses were leaving the states that were harboring these thieves. The risk only lied with the store owner, the law abiding citizen.

In other states, not only could business owners operate freely without the fear of a mob organizing a “hit” on their stores, they could also pay their employees less due to a lower cost of living.

Employment Wages

As it stands the current minimum wage in California is $15 an hour. In Idaho, it is $7.25 an hour. Now, let’s say you were going to start a successful business with several employees, and you knew that you could operate in either state, where would you go? Idaho or California?

The decision that would make the most financial sense for you is Idaho. Bear in mind this is before shipping, and management, product availability, and overhead, and everything else. We are strictly looking at how much you would have to pay your employees, based on that alone, most businesses would choose to move to Idaho instead of staying in California.

Very few businesses today can still pay $7.25 an hour and still get anyone to work for them though. Just as in California very few businesses can pay $15 an hour and still remain attractive to job seekers. Inflation has had its own impact on the job market.

Why Are People Moving to Idaho?

When it comes to a state that would draw people in, very few people might have Idaho at the top of their list. So, why do people even consider moving there? What is it about Idaho that brings people there?

Politics

Idaho is, always has been, and hopefully always will be a red state. Recently, the Governor of Idaho, Brad Little, was re-elected in a landslide vote. He drew in 60.5% of voters while his democratic challenger only drew in 20.3%.

It doesn’t seem like Idaho is going to flip blue, or even purple any time soon.

Outside of how people vote, there’s also certain laws and policies. For example, you don’t need a permit or license to conceal carry in Idaho. This is just something that people do here.

Another example is that of Grand Theft, which is the theft of anything over $1,000 amounts to a felony, no more $10,000 and 1-20 years in prison.

Idaho does things different when it comes to politics. The state doesn’t have soft on crime policies that we believe have made California go downhill as quickly as it has.

Taxes

From the Idaho Tax Commission, “Income tax rates for 2021 range from 1% to 6.5% on Idaho taxable income. Individual income tax is graduated. This means that Idaho taxes higher earnings at a higher rate”.

The most that your income will be taxed is 6.5%, and as a business owner, there’s no double taxing like you saw in California.

In Idaho the sales tax is 6% as opposed to California which is 7.25%.

Across the board, Idaho is just more tax friendly. The only place that California beats out Idaho is property taxes.

California sits at 0.73% while Idaho’s statewide urban tax rate averages 1.511% and the rural rate is 0.994%.

Cost of Living

Instead of writing out the cost of living for Idaho, we’ve done research for you in a video which you can watch below.

Crime

We know we’ve mentioned this before (maybe more than once) but our clients love how safe Idaho is. But it’s not just our clients that have taken notice of how safe it is here. Even US News put Idaho in their Top 10 of Safest Places to Live in the United States.

You can read the full 2021 Idaho Crime Report here.

Pros and Cons of Moving to Idaho

We wouldn’t be doing you, the reader, any favors if we didn’t just lay out some of the common pros and cons in a simple, bulleted list that you can glance over. Let’s start with Pros:

Pros of Moving to Idaho

  • The weather
    • Interestingly, this one is also on our Cons list, but is still a pro. In Idaho you get 4 full seasons. You get to see the leaves turn which is one if not our favorite part of the year.
  • Cost of Living
    • Clearly living in California is sometimes a little overbearing cost wise. Idaho is much more resident friendly.
  • Less Crime
    • There’s only 9,000 incarcerated individuals, what does that tell you?
  • Taxes
    • Less taxes means more money in your pocket
  • Politics
    • Not saying red is better, but it certainly feels like it makes life a little easier!

Cons of Moving to Idaho

  • The weather
    • Like we said, this one is a pro and a con. The winter can be an adjustment, although it’s nothing like you’re probably imagining. We usually have a white Christmas, but don’t get feet and feet of snow. It’s usually a light powder.
  • Less pay
    • As we mentioned earlier you do get paid less here in Idaho, but that just comes with the territory, your cost of living is less.
  • No oceans
    • For some this is a huge drawback for others it’s really not a big deal. They made planes and trains for a reason!
  • The Politics
    • Depending on how you align your views, Idaho might not be the place for you.
  • Amusement Parks
    • In Northern Idaho there is a small amusement park but other than that, that’s about it! No Universal Studios or Disneyland here!

 

How to Plan Your Move to Idaho

We actually wrote a guide on 10 Things You Shouldn’t Do When Moving to Idaho From California which we highly recommend downloading. But for things that you should do, here’s our list:

  1. Do a fact-finding trip
  2. Know your wants and needs
  3. Trust Yourself
  4. Create a Budget and Stick to it
  5. Get rid of your junk
  6. Prep your pet
  7. Have health insurance
  8. Get your car looked at
  9. Don’t second guess your decision
  10. When you’re ready to move… DO IT!

We go over these ten things in more detail in the guide we mentioned earlier by covering the things you shouldn’t do. If you stick to what we tell you in the guide, you’ll be just fine!

Moving to Idaho Will Be the Best Move You Ever Made

Clients like working with us because we practice and have practiced what we preach. Each one of us has moved to Idaho from somewhere else. Dave, Mareen, Kelly, and Aaron each moved from California and Steven moved from Washington.

We know that you will be happier in Idaho.

But how will you know?

It all goes back to that fact finding trip, doing some research, and really just giving us a call and letting us help you. We know that a better quality of life is waiting for you in Idaho, and we want to help you get it!

If you’re interested in learning more about Idaho give us a call at 208-860-2004 or shoot us an email at info@treasurevalleydave.com, we’d love to help you start planning your move from California to Idaho today!

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