2 ms·
My perspective is the COL difference is mostly housing. There are other things that are more expensive than MCOL cities like gas, utilities, childcare, but it'
by refurb 4y ago
My perspective is the COL difference is mostly housing. There are other things that are more expensive than MCOL cities like gas, utilities, childcare, but it's pretty much housing that makes up most of the higher costs.
And housing costs are quite different between the peninsula south of SF and the East Bay, so it's not easy to answer your question.
But if the expectation is that a family of 5 owns a home and the 3 kids are in public school, I'd say a household income (base salary) of $200-$250k is where you get into the "I can afford the basics and still save for retirement" starts.
- Firmwarrior 4y agoThat fits my experience. If your W-2 income is 200k+ you should be able to afford everything including a place to live (old beaten-down shithole house in a bad neighborhood with a long commute, or old beaten-down tiny shithole condo close to work) Of course, it's easy to look at that and say "Oh, I'm coming out way ahead by making 150k in $NormalCity instead", but realistically _everything_ after that base 200k is going straight into liquid net worth. So if you're choosing between 400k in Mountain View and 300k in $NormalCity it's an interesting decision, but 400k in Mountain View means you're going to retire way earlier than you would with 200k in $NormalCity
- refurb 4y agoExactly. Once you cover the essentials, everything above that is cash in your pocket. People say "oh my god, housing is double in the Bay Area"? And yeah it is. But if you're renting and it doubles from $2,000 to $4,000, that's an extra $24,000 post-tax per year. If you're getting a salary bump of >$36,000 per year (pre-tax) then you'll still be ahead paying double for rent.