4 ms·
I'm in the process of transitioning out of a FAANG SWE position to be full time in property development. There's not enough houses for people to live in. Most
by onlyrealcuzzo 5y ago
I'm in the process of transitioning out of a FAANG SWE position to be full time in property development.
There's not enough houses for people to live in. Most people hate you for "driving up prices" and "gentrifying neighborhoods" - but it leaves me much more satisfied than engineering.
After paying ~40% tax for a decade and paying ~3x what the Fed and State spend per Capita over a lifetime - it's nice to see my working hours reduced dramatically and my true tax rate drop down to ~12%.
You don't need to make $1M per year, when you don't have to give $400k to the tax man.
- soared 5y agoAlways feels weird when someone in the top 1% of earners, making over $500k/yr, complains about taxes.
- marcrosoft 5y agoWhy? They are the ones that end up paying the most.
- micromacrofoot 5y agobecause regardless of paying most taxes, they’re still making most money
- 55555 5y agoHe’s saying his tax rate is dropping to 12%. So at his level it is possibly easier to make more money by switching to a job/business with a lower tax rate, even if income is somewhat lower. (I’m not sure how he’s getting 12%… LTCG with deductions?)
- onlyrealcuzzo 5y agoIn real estate your cash flow can be much higher than your taxable income due to depreciation. Since it's unearned income, you don't have to pay payroll taxes. And you can also avoid paying capital gains tax on the first $250k in capital gains on a property (after 1 year). There are a lot of people in speculative markets that pay close to 0 tax in real estate.
- 55555 5y agoThanks! That’s interesting.
- sixstringtheory 5y agoProbably because 1) it’s not a surprise. You knew how much the tax would be when you accepted the position and 2) your net take-home is still higher than most. Also note that the nice round figures OP provides are slightly over the top. In 2021, someone earning $1M would pay an effective 33% tax rate, or about $334K. That’s $66K below their stated $400K. The poverty line for a family of 4 is just over $20K. So their rounding error is nearly 3 times the poverty line for a couple with two kids. Their net take home every year is an absolutely staggering and life changing amount of money for anyone who hasn’t spent years climbing the sociopathic career ladder at a tier 1 tech outfit.
- onlyrealcuzzo 5y agoIn California - your total tax on $1M is close to $485k...
- thisarticle 5y agoHow can they possibly survive on ten times the median national income.
- gaws 5y ago> They are the ones that end up paying the most. Top 1%? Paying their share of taxes? Ha ha ha.
- Eextra953 5y agoCan you expand on you how transitioned to property development? Where there any books or classes that helped? I am interested in doing something similar but I don't know where to start.
- onlyrealcuzzo 5y agoIn short - I'm not aware of anything great. I don't think BiggerPockets is actually a great source - but it might be the best to get started.