10 ms·

I made 6 figures at my Facebook dream job – but couldn't afford the Bay Area

59 points by yladiz 10y ago

byoung2 10y ago
The only problem: It’s really hard for a family of four to live in the Bay Area on just one income — even if it’s a great income In any of the prime real estate markets it's hard to live on one salary. That is not a problem unique to the Bay Area. Furthermore, barely breaking 6 figures is not a generous salary in tech (he even says it was on par with his salary in AZ).
- flubert 10y ago
  Yes. Compare and contrast: http://www.zillow.com/homedetails/152-Sagamore-St-San-Francisco-CA-94112/15195448_zpid/ http://www.zillow.com/homedetails/152-Sagamore-St-San-Franci... http://www.zillow.com/homedetails/1055-Gilman-Ave-San-Francisco-CA-94124/15154652_zpid/ http://www.zillow.com/homedetails/1055-Gilman-Ave-San-Franci... http://www.zillow.com/homedetails/15320-Swan-Ct-Gulfport-MS-39503/81696625_zpid/ http://www.zillow.com/homedetails/15320-Swan-Ct-Gulfport-MS-...
cyberpanther 10y ago
Having the same problem. I have a lot of job offers for the bay area but can't make the jump because it would destroy my family life due to the high cost. Middle class families are basically priced out of Silicon Valley.
- calebm 10y ago
  Perhaps... some companies would see that as an advantage? If you were a company who only wanted to hire young people with no family to keep them from working 70 hours a week, then locating in Silicon Valley could be a great strategy.
  - cyberpanther 10y ago
    Yes I often wonder if that is a real strategy. Any whistle blowers want to let us know?
dsfyu404ed 10y ago
What the title should read is "couldn't afford a lifestyle I felt was befitting someone making six figures in the bay area"
- dgacmu 10y ago
  "a niceish $40,000 car," ish. High on the list of signs that you've bought far too much into lifestyle inflation is thinking that a car costing 70% of the US median household income is only "nice-ish."
  - aardvark291 10y ago
    Seriously. I have a cushy tech-job yet still drive the hatchback I bought fifteen years ago for $2000. Choices...
    - wehadfun 10y ago
      I still drive a no frils Chevy I bought 10 years ago what happened to me was a wife + kid. Sure I could have bought wife a 19K car but with everone driving around trucks and SUVs it doesn't matter how great your air bags are the laws of physics are not in your favor. 40K is easy for a decent sized car/truck/suv
  - cyberpanther 10y ago
    Lets take the product of Silicon Valley, the Tesla. Even take the cheap one at $35,000. I don't think that is much to expect in a lifestyle also considering you make more than most people. Henry Ford back in the day raised wages and cut hours because he noticed not even his employees had money or time to enjoy his product. I think Silicon Valley is at this same point. Work your butt off to not enjoy life. If your single I think the economics work out but for families the area is very hostile.
    - skybrian 10y ago
      I don't understand why someone having trouble supporting their family would buy a new car at all. A nice used car is not that different and significantly cheaper.
scarby 10y ago
Barely breaking 6 figures is an entry level engineers salary in the bay area. Also in the world that I live in single income families are the exception rather than the rule.
- pmiller2 10y ago
  He was barely breaking 6 figures in 2009. I wasn't around the Bay Area then, but that strikes me probably significantly better than entry level at the time, given the way rents have gone.
  - stephencanon 10y ago
    Back in 2009 you could rent a house with a yard in a nice part of Palo Alto for ~2.5k/month (Or less, my wife and I were paying 1.8k at the time for a small but very nice house with a 1 acre yard). ~$100k (while still reasonably entry-level) went pretty far then.
ting_bu_dung 10y ago
the price increase of silicon valley homes partly is affected by all the foreign capital seeking stable, safe investment in US, particularly China's in the last few years (due to China's exponential growth in debt creation). we should see substantial slowdown/decline in the coming months (because China's economy has stagnated, and because the capital control for most normal citizens have worked)
- kelukelugames 10y ago
  I hear this anecdote all of the time. In fact, when I was buying a house I lost two offers to foreign buyers. I've seen studies show the impact of AirBnB on real estate prices, are there similar one for foreign buyers?
lj3 10y ago
Am I the only one who thinks the great big takeaway from this is the guy works for local motors?!? Talk about landing on your feet. I've wanted to work for them for years, but their need for web developers is small and the timing never quite worked out.
simonturvey 10y ago
I was quite sympathetic until I hit the mini-bio at the bottom: "Matt Kulka works for Local Motors in Phoenix, Arizona. He loves to drive cars around race tracks, his expensive hobby that he just doesn’t want to kick."
- pinewurst 10y ago
  For me it was: "My salary was about on-par with what I was making at my last job in Phoenix — just barely breaking into the six figures — but housing costs were significantly different." Who in their right mind would move to the Bay Area on a Phoenix salary?!
  - PacketPaul 10y ago
    Two reasons: Stock Options Work at Facebook
koolba 10y ago
> We knew as our family grew that we wouldn’t want to live with a roommate forever. So when the opportunity arose for me to supplement my salary by selling my Facebook stock, I took it. I’d been granted a few thousand shares when I got hired, and after the company had its IPO in 2012, I sold all the shares that had vested. > We could finally rent a house for just our family, no roommate. It was great, but that also meant even larger housing costs. In order to afford that, selling stock became necessary every quarter it vested. Obviously, this is not the path to financial security, but when the sum of money that lands in front of you isn’t life changing, you look to the short term and what it can do for you right now. In many ways, this follows exactly with the Silicon Valley hustle that many startups fall into. The path in front of you isn’t always clear, so you hedge your bets. WTF? If your day to day financial survival depends on selling stock as it vests you're either a) an idiot or b) backed into a corner. In this guys case, it should have been obvious when he started the gig that it wasn't sustainable. If not immediately, then when he moved out and started selling stock to cover renting a house. A pretty simple rule is that you should be accumulating capital, not spending it to cover operating expenses. Sure if shit hits the fan, and it invariably will at some point, you will be spending from capital till you get back on your feet. But it shouldn't be a day to day thing.
- robalfonso 10y ago
  I agree completely with you, I would stipulate one thing. When starting a new job its reasonable to take a short term hit in the hopes of advancement (and higher wages). So its fine to have a room mate and live a less than desirable life time short term. I think the time to pull the plug though is at dumping the stock.
timtadh 10y ago
I think the point is: his salary while not high by SF was high in nearly any other location in the US. In any other location, he and his family could live how they wanted. In any other location, have a $40,000 car instead of a $10,000 or less car is a perfectly reasonable. In any other location, eating out more than once a month would be perfectly reasonable. Having a expensive hobby racing cars is reasonable, just not in SF. The point of the article wasn't that I am poor you should feel sad for me. The point was: look the Bay Area is so expensive that it is impossible to afford unless you are making an extremely high salary. A good salary isn't enough, a high salary isn't enough, it has to be extreme otherwise you will need to make life style sacrifices to live in the Bay Area.
- colmvp 10y ago
  Well yeah. That rings true for a lot of popular cities... is that really edifying? Fundamentally before moving to a new city, you can calculate your salary minus expenses and see how much you have to sacrifice to make it viable to save money. It was practically the first thing I did when looking for an apartment in NYC after taking a new job. Especially with major cities, having a single income family is only viable if one person earns a lot and/or the couple has no intention of buying a property and settling down.
- tw04 10y ago
  Just to be clear - racing cars is EXPENSIVE if you're even remotely serious. You're talking about blowing easily $2,000 per weekend of racing, and that's if you're operating on a budget and already own the car.
- PacketPaul 10y ago
  So basically he sold his stock options to buy a 40k car.
- bbctol 10y ago
  But part of the reason he was paid so much was because he lived in the Bay Area; Facebook wouldn't pay nearly as high salaries if they were based in the Midwest. In "any other location," he still might not have been able to afford hobby racing, and it's weird to act entitled on the one hand and not acknowledge the other, as if the salary is deserved solely based on the work he's done, and the cost of living is a completely separate punishment.
noer 10y ago
I don't know, it seems like a lot of this guy's problems are totally within his control. I sort of assume he's the only income source for his family, but also has an expensive hobby he doesn't want to give up and also wants to live a life of (somewhat) luxury. I mean, I get it, kids and the Bay Area are expensive, but I think there are better examples of "the cost of living in the Bay Area is out of control" than a guy with a reasonably good job and an expensive hobby he doesn't want to give up.
- decaysackparity 10y ago
  Yeah, I don't get it either. What happen to living below your means? I make 6 figures, drive a 16yo car (2000 accord FTW!), take public transpiration to work, brown bag lunch. My partner works part-time to take care of our child. My home is the right size for what we need. Why does this guy have to live in a Bay Area? No one is going to weep for you, buddy. You made bad life decisions and you need to deal with them. EDIT: spelling
zeveb 10y ago
> I’d been granted a few thousand shares when I got hired, and after the company had its IPO in 2012, I sold all the shares that had vested. … We could finally rent a house for just our family, no roommate. In order to afford that, selling stock became necessary every quarter it vested. Obviously, this is not the path to financial security, but when the sum of money that lands in front of you isn’t life changing, you look to the short term and what it can do for you right now. What‽ Selling capital in order to finance daily survival is terrible: the entire point of a working life is to accumulate capital in order to finance a retirement. Not having a roommate was, literally, a luxury he and his family could not afford. > But for a person with a family of four who has a certain lifestyle that they want to try to maintain (a niceish $40,000 car, the ability to go out once a month and leave the kids with a sitter, a house that wasn't last remodeled in ’70s, etc.) it can be difficult. If you have a wife and two kids, then maybe buying $40,000 cars is a mistake. Maybe getting a fancy house is a mistake. True fact: children survived into adulthood just fine in the 1970s. Part of being an adult is knowing how to differentiate between essentials and luxuries. Honestly, with his sort of (admitted) short-term financial mismanagement, I don't think he could survive on six figures in Dallas, Houston, Denver, Kansas City or anywhere else. He'd make the same sort of bad decisions, perhaps with a longer runway to ruin.
- coldtea 10y ago
  >What‽ Selling capital in order to finance daily survival is terrible: the entire point of a working life is to accumulate capital in order to finance a retirement. And yet people do it all the time. Not to mention the billions living hand to mouth.
- swsieber 10y ago
  People want the nice things their parents had, but not on the same timeline. They don't realize that nice things take a while to accumulate. Yes my parents drive a Prius. But growing up in a family with 5 other siblings, they pretty much drove beaters. And our house started with, as we so fondly called them, the seven ugly carpets of the world. And those were slowly replaced over time. The house we lived in until I was one had slanted kitchen floors - just throw a towel at the correct wall if you spilled. The point is that our parents affluence isn't the result of a general rise in affluence - it's accumulated. But we often don't think about that when making our early financial decisions.
c17r 10y ago
> The offices are like Disneyland for tech folk. Vast open stretches of adjustable desks.... I kinda stop reading and just started skimming after that.
jkot 10y ago
I work remotely for past 5 years. Nothing beats that if you have small children.
surfrider 10y ago
This guy would get DESTROYED over at /r/personalfinance
- paulcole 10y ago
  LENTILS!
ones_and_zeros 10y ago
I think there is something to be said about living beyond their means but, to me, a new car and home for my family is a fair middle class lifestyle. (You can quibble over the 40k price tag, but buying a 40k car and making it last doesn't have as much of a financial difference as a 30k car over the long term) I think this article is speaking out against this narrative that techies are incredibly well paid while in reality we mostly work in over priced cities with awful commutes and have a government and industry openly trying to suppress wages. Any time one of us says "hey, we aren't that well paid" there is always someone to say we should move further away from work, or downsize, or skip having a family, or stick to rice and beans and it's getting old.
- hapless 10y ago
  When you support an entire family on a single income, spending 30% or 40% of your annual pay on a car is irresponsible. No "ifs," "ands," or "buts." That's just bad financial planning. It's a totally unnecessary luxury that holds the potential to burden the entire family. Additionally, your definition of "middle class" is quite peculiar. The median wage in the United States is less than $30k. The median household income is less than $60k. Do you really think "middle class" families are buying cars that cost as much as one of their salaries?
  - ones_and_zeros 10y ago
    Again, missing the point. The narrative is that we are so well paid that we should be able to do that. But we obviously can't. I'll concede that software engineers are overpaid and in such high demand when that is the case for the median case. Just caught your edit. Middle class is relative to cost of living. Most of us work in cities where the CoL is much higher and so is the middle class income. It'd be better if we can both stick to comparing apples to apples and I think in this case sticking to cities is our best bet. SF median income is 100k [0] [0] http://www.deptofnumbers.com/income/california/san-francisco/ http://www.deptofnumbers.com/income/california/san-francisco...
    - hapless 10y ago
bgirard 10y ago
I'm moving to the bay area to take a job at Facebook in 2 weeks. When comparing all my offers, my wife and I made a budget for each offer to understand the salary differences and their cost of living. We know exactly what we can afford. I don't understand why everyone doesn't do this before taking a job somewhere.
ravenstine 10y ago
That's exactly why I chose not to work in the Bay Area. Perhaps I have chosen the less challenginger or rewarding path (I don't know), but my first job as a programmer paid me peanuts(40k) and I lived in a pretty nice place with a roommate; a year later I got another job that paid 84k and got to rent a small house, live on my own, and not have to worry about how much I spend. Entry level pay, even in SoCal, can mean decent living. Entry level in the Bay seems to mean constantly struggling to make ends meet while living with several people. Granted, I know people who get a thrill out of that, and that's perfectly fine, but that's just not for me. Living both in San Francisco and the East Bay taught me that. Was fun, but I like not being a workhorse and having excess cash to spend on my various projects. Then again, it sounds like tat guy's spending was way out of line. Like many people, he probably blew his money on expensive toys(and a penis car) to gain a feeling of status.
alain94040 10y ago
On craigslist, I find 2-bedroom houses in Santa Clara for $2300 [1]. That would give you a very decent commute to Facebook (much better than living in the East Bay). That's $28K/year. His net salary should be around $65K. You should be able to go out more than once a month with the money. [1] http://sfbay.craigslist.org/sby/apa/5780924443.html http://sfbay.craigslist.org/sby/apa/5780924443.html
- api_or_ipa 10y ago
  I wonder why the author wholesale ruled out apartments when homes like the one you linked to are all together very similar in living space. On a side note the Bay areas' affordability problem could be greatly reduced if more dense housing stock was pursued. Sadly, I fear too many of us demand living in houses as an unassailable demand.
cemregr 10y ago
Facebook has offices in Seattle and NYC too. In NYC you can buy in NJ, Queens or Brooklyn and still have a reasonable commute.
wehadfun 10y ago
100K aint what it used to be.
nunez 10y ago
Tech is a well-paying job in areas where you need to be well-paid to live somewhat comfortably. It isn't nearly as lucrative in other areas unless you're a remote worker and you negotiate well and/or you work in the right industry (finance, healthcare, law). At least that's what I'm beginning to notice anyway. The fiscally responsible thing to do would be to move to New York City, take a $100k+ job, live about 45-60 minutes away in Brooklyn, Queens, Staten Island or the Bronx, create an emergency fund, get promoted a few times and spend a good while finding a high-paying job in the area you actually want to live in that has a significantly lower COL. The thing about SF is that it isn't just the rent that kills you. You also get taxed like crazy for everything and, from what I've heard from coworkers over the years, you'll need to have a car to be realistically mobile outside of the Bay (unless you never leave the Bay, of course). Insurance premiums cost more there and CA gas is the most expensive in the nation. As much as we like to complain about it, public transit in NYC is amazing. You legitimately don't need a car to live there. It's darn convenient in the outerboroughs, but it isn't a necessity and, in many cases, it's a pain in the ass. Speed limits are low city-wide. Expressways top out at 50 and are usually set at 40 because of population density and shitty road conditions. People are super aggressive. NYC is not fun to drive in. Manhattan is much much worse. Nearly the entire city is reachable by train and/or bus. You can save a lot of money this way.
davidf18 10y ago
The higher prices for housing are because of politically induced scarcity through zoning density restrictions. SF, NYC, LA, Boston, DC, London, and other cities suffer from these "market failures" in this case called "economic rents." The result is a regressive "tax" transferring wealth from renters to landlords. Income that should be going towards goods and services are going toward landlords such as Donald Trump instead making landlords far wealthier than they would be in an efficient market. In NYC, there was formerly a politically induced scarcity of taxi medallions (limited to 13,000) with the result that medallions had a market value for $1.2 million and taxi riders paid higher fares to help cover the higher taxi leasing prices of drivers. Once Uber/Lyft came to town, the politically induced scarcity was no longer occurring as there were many more taxi-like vehicles. The result: taxi medallions dropped in value to $700,000 and Uber/Lyft rides have been getting cheaper (but still far higher than LA, Chicago). See (Harvard Economist) Edward Glaeser: Build Big Bill http://www.nydailynews.com/opinion/build-big-bill-article-1.1913739 http://www.nydailynews.com/opinion/build-big-bill-article-1.... and Financial Times columnist and BS, MS Economics Oxford Tim Harford: The Undercover Economist https://www.amazon.com/dp/B007NIDW1Q/ https://www.amazon.com/dp/B007NIDW1Q/ Many people complain about the high cost of living, but the issue is simply political. High tech people, particularly need to get involved in politics to help make housing more affordable for all. Simply fix the "rent seeking" laws that restrict zoning density. In the 19th century, David Ricardo wrote about the "Corn Law" which placed high tariffs on all grain imported to England with the result that landlords that owned land that grain was grown on realized far greater "economic rents" amounts of money for their land while other people paid for for basic food such as bread. Ricardo went into politics to help reverse the Corn Laws with the result that landlords no longer realized their regressive tax on consumers while food prices decreased. The housing problem is simply another case of "Corn Laws." In particular, Google (Alphabet) has a profit making subsidiary called Sidewalk Labs for improving cities. https://www.sidewalklabs.com https://www.sidewalklabs.com From the website: "Sidewalk Labs is a new type of company that works with cities to build products addressing big urban problems." City Labs is in a position to use Google's resources to make housing more affordable. Google owns one of the largest office buildings in NYC and Sidewalk labs is located in NYC, so NYC might be a good place to start. Like Ricardo's case of reversing the "Corn Laws" this is simply reversing unfair laws that benefit landlords over renters and make housing unaffordable. No increase in taxes are required.

59 points by yladiz 10y ago

The only problem: It’s really hard for a family of four to live in the Bay Area on just one income — even if it’s a great income In any of the prime real estate markets it's hard to live on one salary. That is not a problem unique to the Bay Area. Furthermore, barely breaking 6 figures is not a generous salary in tech (he even says it was on par with his salary in AZ).

flubert 10y ago
Yes. Compare and contrast: http://www.zillow.com/homedetails/152-Sagamore-St-San-Francisco-CA-94112/15195448_zpid/ http://www.zillow.com/homedetails/152-Sagamore-St-San-Franci... http://www.zillow.com/homedetails/1055-Gilman-Ave-San-Francisco-CA-94124/15154652_zpid/ http://www.zillow.com/homedetails/1055-Gilman-Ave-San-Franci... http://www.zillow.com/homedetails/15320-Swan-Ct-Gulfport-MS-39503/81696625_zpid/ http://www.zillow.com/homedetails/15320-Swan-Ct-Gulfport-MS-...

cyberpanther 10y ago

Having the same problem. I have a lot of job offers for the bay area but can't make the jump because it would destroy my family life due to the high cost. Middle class families are basically priced out of Silicon Valley.

calebm 10y ago
Perhaps... some companies would see that as an advantage? If you were a company who only wanted to hire young people with no family to keep them from working 70 hours a week, then locating in Silicon Valley could be a great strategy.
- cyberpanther 10y ago
  Yes I often wonder if that is a real strategy. Any whistle blowers want to let us know?

dsfyu404ed 10y ago

What the title should read is "couldn't afford a lifestyle I felt was befitting someone making six figures in the bay area"

dgacmu 10y ago
"a niceish $40,000 car," ish. High on the list of signs that you've bought far too much into lifestyle inflation is thinking that a car costing 70% of the US median household income is only "nice-ish."
- aardvark291 10y ago
  Seriously. I have a cushy tech-job yet still drive the hatchback I bought fifteen years ago for $2000. Choices...
  - wehadfun 10y ago
    I still drive a no frils Chevy I bought 10 years ago what happened to me was a wife + kid. Sure I could have bought wife a 19K car but with everone driving around trucks and SUVs it doesn't matter how great your air bags are the laws of physics are not in your favor. 40K is easy for a decent sized car/truck/suv
- cyberpanther 10y ago
  Lets take the product of Silicon Valley, the Tesla. Even take the cheap one at $35,000. I don't think that is much to expect in a lifestyle also considering you make more than most people. Henry Ford back in the day raised wages and cut hours because he noticed not even his employees had money or time to enjoy his product. I think Silicon Valley is at this same point. Work your butt off to not enjoy life. If your single I think the economics work out but for families the area is very hostile.
  - skybrian 10y ago
    I don't understand why someone having trouble supporting their family would buy a new car at all. A nice used car is not that different and significantly cheaper.

scarby 10y ago

Barely breaking 6 figures is an entry level engineers salary in the bay area. Also in the world that I live in single income families are the exception rather than the rule.

pmiller2 10y ago
He was barely breaking 6 figures in 2009. I wasn't around the Bay Area then, but that strikes me probably significantly better than entry level at the time, given the way rents have gone.
- stephencanon 10y ago
  Back in 2009 you could rent a house with a yard in a nice part of Palo Alto for ~2.5k/month (Or less, my wife and I were paying 1.8k at the time for a small but very nice house with a 1 acre yard). ~$100k (while still reasonably entry-level) went pretty far then.

ting_bu_dung 10y ago

the price increase of silicon valley homes partly is affected by all the foreign capital seeking stable, safe investment in US, particularly China's in the last few years (due to China's exponential growth in debt creation). we should see substantial slowdown/decline in the coming months (because China's economy has stagnated, and because the capital control for most normal citizens have worked)

kelukelugames 10y ago
I hear this anecdote all of the time. In fact, when I was buying a house I lost two offers to foreign buyers. I've seen studies show the impact of AirBnB on real estate prices, are there similar one for foreign buyers?

lj3 10y ago

Am I the only one who thinks the great big takeaway from this is the guy works for local motors?!? Talk about landing on your feet. I've wanted to work for them for years, but their need for web developers is small and the timing never quite worked out.

simonturvey 10y ago

I was quite sympathetic until I hit the mini-bio at the bottom: "Matt Kulka works for Local Motors in Phoenix, Arizona. He loves to drive cars around race tracks, his expensive hobby that he just doesn’t want to kick."

pinewurst 10y ago
For me it was: "My salary was about on-par with what I was making at my last job in Phoenix — just barely breaking into the six figures — but housing costs were significantly different." Who in their right mind would move to the Bay Area on a Phoenix salary?!
- PacketPaul 10y ago
  Two reasons: Stock Options Work at Facebook

koolba 10y ago

> We knew as our family grew that we wouldn’t want to live with a roommate forever. So when the opportunity arose for me to supplement my salary by selling my Facebook stock, I took it. I’d been granted a few thousand shares when I got hired, and after the company had its IPO in 2012, I sold all the shares that had vested. > We could finally rent a house for just our family, no roommate. It was great, but that also meant even larger housing costs. In order to afford that, selling stock became necessary every quarter it vested. Obviously, this is not the path to financial security, but when the sum of money that lands in front of you isn’t life changing, you look to the short term and what it can do for you right now. In many ways, this follows exactly with the Silicon Valley hustle that many startups fall into. The path in front of you isn’t always clear, so you hedge your bets. WTF? If your day to day financial survival depends on selling stock as it vests you're either a) an idiot or b) backed into a corner. In this guys case, it should have been obvious when he started the gig that it wasn't sustainable. If not immediately, then when he moved out and started selling stock to cover renting a house. A pretty simple rule is that you should be accumulating capital, not spending it to cover operating expenses. Sure if shit hits the fan, and it invariably will at some point, you will be spending from capital till you get back on your feet. But it shouldn't be a day to day thing.

robalfonso 10y ago
I agree completely with you, I would stipulate one thing. When starting a new job its reasonable to take a short term hit in the hopes of advancement (and higher wages). So its fine to have a room mate and live a less than desirable life time short term. I think the time to pull the plug though is at dumping the stock.

timtadh 10y ago

I think the point is: his salary while not high by SF was high in nearly any other location in the US. In any other location, he and his family could live how they wanted. In any other location, have a $40,000 car instead of a $10,000 or less car is a perfectly reasonable. In any other location, eating out more than once a month would be perfectly reasonable. Having a expensive hobby racing cars is reasonable, just not in SF. The point of the article wasn't that I am poor you should feel sad for me. The point was: look the Bay Area is so expensive that it is impossible to afford unless you are making an extremely high salary. A good salary isn't enough, a high salary isn't enough, it has to be extreme otherwise you will need to make life style sacrifices to live in the Bay Area.

colmvp 10y ago
Well yeah. That rings true for a lot of popular cities... is that really edifying? Fundamentally before moving to a new city, you can calculate your salary minus expenses and see how much you have to sacrifice to make it viable to save money. It was practically the first thing I did when looking for an apartment in NYC after taking a new job. Especially with major cities, having a single income family is only viable if one person earns a lot and/or the couple has no intention of buying a property and settling down.
tw04 10y ago
Just to be clear - racing cars is EXPENSIVE if you're even remotely serious. You're talking about blowing easily $2,000 per weekend of racing, and that's if you're operating on a budget and already own the car.
PacketPaul 10y ago
So basically he sold his stock options to buy a 40k car.
bbctol 10y ago
But part of the reason he was paid so much was because he lived in the Bay Area; Facebook wouldn't pay nearly as high salaries if they were based in the Midwest. In "any other location," he still might not have been able to afford hobby racing, and it's weird to act entitled on the one hand and not acknowledge the other, as if the salary is deserved solely based on the work he's done, and the cost of living is a completely separate punishment.

noer 10y ago

I don't know, it seems like a lot of this guy's problems are totally within his control. I sort of assume he's the only income source for his family, but also has an expensive hobby he doesn't want to give up and also wants to live a life of (somewhat) luxury. I mean, I get it, kids and the Bay Area are expensive, but I think there are better examples of "the cost of living in the Bay Area is out of control" than a guy with a reasonably good job and an expensive hobby he doesn't want to give up.

decaysackparity 10y ago
Yeah, I don't get it either. What happen to living below your means? I make 6 figures, drive a 16yo car (2000 accord FTW!), take public transpiration to work, brown bag lunch. My partner works part-time to take care of our child. My home is the right size for what we need. Why does this guy have to live in a Bay Area? No one is going to weep for you, buddy. You made bad life decisions and you need to deal with them. EDIT: spelling

zeveb 10y ago

> I’d been granted a few thousand shares when I got hired, and after the company had its IPO in 2012, I sold all the shares that had vested. … We could finally rent a house for just our family, no roommate. In order to afford that, selling stock became necessary every quarter it vested. Obviously, this is not the path to financial security, but when the sum of money that lands in front of you isn’t life changing, you look to the short term and what it can do for you right now. What‽ Selling capital in order to finance daily survival is terrible: the entire point of a working life is to accumulate capital in order to finance a retirement. Not having a roommate was, literally, a luxury he and his family could not afford. > But for a person with a family of four who has a certain lifestyle that they want to try to maintain (a niceish $40,000 car, the ability to go out once a month and leave the kids with a sitter, a house that wasn't last remodeled in ’70s, etc.) it can be difficult. If you have a wife and two kids, then maybe buying $40,000 cars is a mistake. Maybe getting a fancy house is a mistake. True fact: children survived into adulthood just fine in the 1970s. Part of being an adult is knowing how to differentiate between essentials and luxuries. Honestly, with his sort of (admitted) short-term financial mismanagement, I don't think he could survive on six figures in Dallas, Houston, Denver, Kansas City or anywhere else. He'd make the same sort of bad decisions, perhaps with a longer runway to ruin.

coldtea 10y ago
>What‽ Selling capital in order to finance daily survival is terrible: the entire point of a working life is to accumulate capital in order to finance a retirement. And yet people do it all the time. Not to mention the billions living hand to mouth.
swsieber 10y ago
People want the nice things their parents had, but not on the same timeline. They don't realize that nice things take a while to accumulate. Yes my parents drive a Prius. But growing up in a family with 5 other siblings, they pretty much drove beaters. And our house started with, as we so fondly called them, the seven ugly carpets of the world. And those were slowly replaced over time. The house we lived in until I was one had slanted kitchen floors - just throw a towel at the correct wall if you spilled. The point is that our parents affluence isn't the result of a general rise in affluence - it's accumulated. But we often don't think about that when making our early financial decisions.

c17r 10y ago

> The offices are like Disneyland for tech folk. Vast open stretches of adjustable desks.... I kinda stop reading and just started skimming after that.

jkot 10y ago

I work remotely for past 5 years. Nothing beats that if you have small children.

surfrider 10y ago

This guy would get DESTROYED over at /r/personalfinance

paulcole 10y ago
LENTILS!

ones_and_zeros 10y ago

I think there is something to be said about living beyond their means but, to me, a new car and home for my family is a fair middle class lifestyle. (You can quibble over the 40k price tag, but buying a 40k car and making it last doesn't have as much of a financial difference as a 30k car over the long term) I think this article is speaking out against this narrative that techies are incredibly well paid while in reality we mostly work in over priced cities with awful commutes and have a government and industry openly trying to suppress wages. Any time one of us says "hey, we aren't that well paid" there is always someone to say we should move further away from work, or downsize, or skip having a family, or stick to rice and beans and it's getting old.

hapless 10y ago
When you support an entire family on a single income, spending 30% or 40% of your annual pay on a car is irresponsible. No "ifs," "ands," or "buts." That's just bad financial planning. It's a totally unnecessary luxury that holds the potential to burden the entire family. Additionally, your definition of "middle class" is quite peculiar. The median wage in the United States is less than $30k. The median household income is less than $60k. Do you really think "middle class" families are buying cars that cost as much as one of their salaries?
- ones_and_zeros 10y ago
  Again, missing the point. The narrative is that we are so well paid that we should be able to do that. But we obviously can't. I'll concede that software engineers are overpaid and in such high demand when that is the case for the median case. Just caught your edit. Middle class is relative to cost of living. Most of us work in cities where the CoL is much higher and so is the middle class income. It'd be better if we can both stick to comparing apples to apples and I think in this case sticking to cities is our best bet. SF median income is 100k [0] [0] http://www.deptofnumbers.com/income/california/san-francisco/ http://www.deptofnumbers.com/income/california/san-francisco...
  - hapless 10y ago

bgirard 10y ago

I'm moving to the bay area to take a job at Facebook in 2 weeks. When comparing all my offers, my wife and I made a budget for each offer to understand the salary differences and their cost of living. We know exactly what we can afford. I don't understand why everyone doesn't do this before taking a job somewhere.

ravenstine 10y ago

That's exactly why I chose not to work in the Bay Area. Perhaps I have chosen the less challenginger or rewarding path (I don't know), but my first job as a programmer paid me peanuts(40k) and I lived in a pretty nice place with a roommate; a year later I got another job that paid 84k and got to rent a small house, live on my own, and not have to worry about how much I spend. Entry level pay, even in SoCal, can mean decent living. Entry level in the Bay seems to mean constantly struggling to make ends meet while living with several people. Granted, I know people who get a thrill out of that, and that's perfectly fine, but that's just not for me. Living both in San Francisco and the East Bay taught me that. Was fun, but I like not being a workhorse and having excess cash to spend on my various projects. Then again, it sounds like tat guy's spending was way out of line. Like many people, he probably blew his money on expensive toys(and a penis car) to gain a feeling of status.

alain94040 10y ago

On craigslist, I find 2-bedroom houses in Santa Clara for $2300 [1]. That would give you a very decent commute to Facebook (much better than living in the East Bay). That's $28K/year. His net salary should be around $65K. You should be able to go out more than once a month with the money. [1] http://sfbay.craigslist.org/sby/apa/5780924443.html http://sfbay.craigslist.org/sby/apa/5780924443.html

api_or_ipa 10y ago
I wonder why the author wholesale ruled out apartments when homes like the one you linked to are all together very similar in living space. On a side note the Bay areas' affordability problem could be greatly reduced if more dense housing stock was pursued. Sadly, I fear too many of us demand living in houses as an unassailable demand.

cemregr 10y ago

Facebook has offices in Seattle and NYC too. In NYC you can buy in NJ, Queens or Brooklyn and still have a reasonable commute.

wehadfun 10y ago

100K aint what it used to be.

nunez 10y ago

Tech is a well-paying job in areas where you need to be well-paid to live somewhat comfortably. It isn't nearly as lucrative in other areas unless you're a remote worker and you negotiate well and/or you work in the right industry (finance, healthcare, law). At least that's what I'm beginning to notice anyway. The fiscally responsible thing to do would be to move to New York City, take a $100k+ job, live about 45-60 minutes away in Brooklyn, Queens, Staten Island or the Bronx, create an emergency fund, get promoted a few times and spend a good while finding a high-paying job in the area you actually want to live in that has a significantly lower COL. The thing about SF is that it isn't just the rent that kills you. You also get taxed like crazy for everything and, from what I've heard from coworkers over the years, you'll need to have a car to be realistically mobile outside of the Bay (unless you never leave the Bay, of course). Insurance premiums cost more there and CA gas is the most expensive in the nation. As much as we like to complain about it, public transit in NYC is amazing. You legitimately don't need a car to live there. It's darn convenient in the outerboroughs, but it isn't a necessity and, in many cases, it's a pain in the ass. Speed limits are low city-wide. Expressways top out at 50 and are usually set at 40 because of population density and shitty road conditions. People are super aggressive. NYC is not fun to drive in. Manhattan is much much worse. Nearly the entire city is reachable by train and/or bus. You can save a lot of money this way.

davidf18 10y ago

The higher prices for housing are because of politically induced scarcity through zoning density restrictions. SF, NYC, LA, Boston, DC, London, and other cities suffer from these "market failures" in this case called "economic rents." The result is a regressive "tax" transferring wealth from renters to landlords. Income that should be going towards goods and services are going toward landlords such as Donald Trump instead making landlords far wealthier than they would be in an efficient market. In NYC, there was formerly a politically induced scarcity of taxi medallions (limited to 13,000) with the result that medallions had a market value for $1.2 million and taxi riders paid higher fares to help cover the higher taxi leasing prices of drivers. Once Uber/Lyft came to town, the politically induced scarcity was no longer occurring as there were many more taxi-like vehicles. The result: taxi medallions dropped in value to $700,000 and Uber/Lyft rides have been getting cheaper (but still far higher than LA, Chicago). See (Harvard Economist) Edward Glaeser: Build Big Bill http://www.nydailynews.com/opinion/build-big-bill-article-1.1913739 http://www.nydailynews.com/opinion/build-big-bill-article-1.... and Financial Times columnist and BS, MS Economics Oxford Tim Harford: The Undercover Economist https://www.amazon.com/dp/B007NIDW1Q/ https://www.amazon.com/dp/B007NIDW1Q/ Many people complain about the high cost of living, but the issue is simply political. High tech people, particularly need to get involved in politics to help make housing more affordable for all. Simply fix the "rent seeking" laws that restrict zoning density. In the 19th century, David Ricardo wrote about the "Corn Law" which placed high tariffs on all grain imported to England with the result that landlords that owned land that grain was grown on realized far greater "economic rents" amounts of money for their land while other people paid for for basic food such as bread. Ricardo went into politics to help reverse the Corn Laws with the result that landlords no longer realized their regressive tax on consumers while food prices decreased. The housing problem is simply another case of "Corn Laws." In particular, Google (Alphabet) has a profit making subsidiary called Sidewalk Labs for improving cities. https://www.sidewalklabs.com https://www.sidewalklabs.com From the website: "Sidewalk Labs is a new type of company that works with cities to build products addressing big urban problems." City Labs is in a position to use Google's resources to make housing more affordable. Google owns one of the largest office buildings in NYC and Sidewalk labs is located in NYC, so NYC might be a good place to start. Like Ricardo's case of reversing the "Corn Laws" this is simply reversing unfair laws that benefit landlords over renters and make housing unaffordable. No increase in taxes are required.