Money

This San Francisco account exec says making one lifestyle change saves him $18,000 a year

With significant expenses like student loans, credit card bills and the cost of housing weighing millennials down, it isn't easy to save money, especially in one of the most expensive cities in the country. But Danny Finlay, a 30-year-old account executive who works at public-relations firm SutherlandGold in San Francisco, says he's found a way to save around $15,000 to $18,000 a year on housing and on miscellaneous everyday expenses like parking and groceries.

He doesn't live in San Francisco. Instead, he commutes four hours and 140 miles each day to get there.

And he thinks it's worth it.

For about a year, Finlay has been commuting from the small town of Dixon, California, to his Bay Area office, which is around two hours and 72 miles away. He wakes up at 4:30 a.m., leaves his house by 5:10 a.m. and takes a combination of car, bus and train to get to work around 7 a.m. Given a five-day workweek, he spends more than 1,000 hours commuting each year, or about 43 full days on the road.

"I mean, I wish [the commute] was shorter," Finlay tells CNBC Make It. "But if I had the choice to live in Dixon and commute, or live in the city and not commute, I'd still commute."

That's, in part, due to the amount of money he saves. In San Francisco, the median rent for an apartment is $4,500 and the median price for a home is more than $1.3 million, according to real-estate website Zillow. In Dixon, by comparison, the median home costs just $460,000.

Finaly and his wife own a three-bedroom home with a swimming pool in Dixon and have mortgage payments of $1,600 a month.

That's less than they'd have to pay to rent a studio in San Francisco. Real-estate site and listing service RENTCafé puts the median rental price for studio at $2,461, a one-bedroom at $3,261, a two-bedroom at $4,377 and a three-bedroom at a whopping $5,143 per month.

Finlay and his wife, Mireya, lived in Los Angeles while in college but decided to move to Dixon after graduation. "We started to think about where we really wanted to settle and where we wanted to buy a house," he says. "The commute allowed us to let our money go further." He says spends less than $150 a week on commuting costs, including gas and public transportation.

Factoring in everything from housing to miscellaneous expenses, Finlay says the choice to live in Dixon rather than the Bay Area saves him as little as $15,000, or as much as $18,000, a year.

Meanwhile, housing prices in major cities continue to rise, reports Zillow. In San Francisco, home values have gone up 7 percent over the past year and are predicted to rise another 6 percent within the next year. In New York, home values have gone up more than 5 percent over the past year and could go up another 6 percent within the next year.

Sydney Bennet, a senior research associate at Apartment List, thinks that's why many Americans who work in expensive cities are opting to live in further away, more affordable places, and commute to work instead.

Nationwide, one in 36 commuters travel 90-plus minutes to work each day. In 2005, there were 3.1 million super-commuters, or about 2.4 percent of all commuters. In 2016, there were 4 million, or almost 3 percent of the total.

Nationwide, one in 36 commuters travel 90-plus minutes to work each day, finds Apartment List.
Courtesy of Danny Finlay
Nationwide, one in 36 commuters travel 90-plus minutes to work each day, finds Apartment List.

Some workers find, Bennet tells CNBC Make It, that commuting "is the right trade-off for their lifestyles. So, maybe they don't want to live in an urban city, but that's where the jobs are, so they make that sacrifice to live where they want to live."

If you're looking to make a change that could help you save on housing, another expense or just stash away more money, consider re-evaluating your budget and living within your means.

By moving back home and restricting his spending, Phil Risher, for example, paid off $30,000 in student loan debt in one year and, in the following year, bought a $60,000 home with cash. Amber and Danny Masters took on odd jobs to try and pay off $600,000 in five years.

Whatever your goal may be, keep in mind that it may not happen overnight. But if you set a realistic plan and are proactive about reaching it, you're more likely to succeed.

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Video by Jonathan Fazio