4 ms·
To be more precise : wages in big cities are high. Most “things” are made in low cost of living / low wage areas. Therefore, paying a local to cook for you is
by j7ake 3y ago
To be more precise : wages in big cities are high. Most “things” are made in low cost of living / low wage areas.
Therefore, paying a local to cook for you is expensive. Buying a kitchen knife made by someone in a low cost of living area is cheap.
This also means that buying a custom knife handmade by a local artisan in your city will be expensive.
- DeathArrow 3y agoWhat you say is that bigger cities have bigger inflation. If you live in a smaller city, earn half, but everything costs half, then, you don't have any incentive to move to a big city.
- ZoomerCretin 3y ago2x salary, 2x costs, 2x savings. The savings are far greater if they compound in investments, and if you're remitting income to someone who lives in the lower cost of living area, it can be worth it.
- DeathArrow 3y ago2x savings does not matter if you have 2x prices.
- deleted 3y ago[deleted]
- citrin_ru 3y agoI does matter if you plan to move to a cheaper area after a retirement. Or even if you are buying a car which costs about the same from California to Virginia - only local goods/services (and housing of course) are more expensive in high cost high salary places. Everything else if about the same within a given country.
- DeathArrow 3y ago>I does matter if you plan to move to a cheaper area after a retirement. Likewise, you can be employed in the big city and work from home living in the small city.
- sublinear 3y agoThe post-covid silver lining. Ask anyone who understands retail market trends and they 100% agree. This is the bulk of the "soft landing". As usual on the shoulders of the middle class.
- j7ake 3y agoSchools, restaurants, and infrastructure like public transport are better in big city than small.
- peterlada 3y ago100% this. Maxing out the 401k annually at the relatively low salary of 150k in NYC is easy. Doing that in St Louis at 50k livable wage is super hard. Car payments? Ditto.
- j7ake 3y agoTrue if you save zero or negative percent of your earnings. If you always save 10 percent of your earnings, then clearly the multiplier works in your favour.
- psychoslave 3y agoIf inflation is higher than what you can earn from a saving account, then how is it rational to "save" anything? You’ll have a bit bigger number on the account, but in the end you can actually buy less. You can of course go with more risky placements and hope to go higher than a saving account, but then you have to spend attention on the market circus with additional worrisome mental load that you can actually lose everything.
- johnnyanmac 3y ago>If inflation is higher than what you can earn from a saving account, then how is it rational to "save" anything? general security? You don't need to (nor should you) hoard 10% of your finances for all 40+ years of your career into a low interest savings account. But you do want to keep a decent amount in case of various downturns. a high CoL city where you pay not much more for "things" can help with that. Can also help pay for an financial advisor who will happily play with the monopoly money for you. Delegation is a great "experience" to consider when comparing costs of living.
- j7ake 3y agoWhen you buy car, fly planes, or shop at Amazon, you do not get a discount for living in a low cost of living area. So the bigger number matters because many products are the same price ecerywhere in the world.
- alright2565 3y ago> but then you have to spend attention on the market circus with additional worrisome mental load that you can actually lose everything. Not true. You can just buy a slice of the whole economy. Then the only situation in which you lose everything is that in which your dollars would be worthless anyway.
- wongarsu 3y agoAlso the industrial revolution happened, which massively drove down the cost of things. Nothing comparable happened for experiences. A restaurant today needs a similar amount of labor to make your meal as a tavern did 400 years ago. Their ingredient costs went down, but waiters and cooks do about the same amount of work, and property values haven't gone down. Meanwhile the amount of work to make a knife has been drastically slashed through technological progress.
- j7ake 3y agoThere was some story once that a quality handmade tailored suit costs about the same amount of gold centuries ago compared to today. Would love to see this fact checked.
- johnnyanmac 3y ago>Nothing comparable happened for experiences. it kind of did. Fast food sacrificed the experience for the core consumption. Then you have chain restaurants like Denny's that exist to give the bare minimum "experience" without throwing it all away like modern drive-thrus. Did they cut down enough to eliminate fine dining? Doesn't look like it. But I haven't done a deep dive into the ecnonomics of that. Just general wisdom that food as a business has always operated on razor thin margins.
- Al-Khwarizmi 3y agoAlso explains why housing is a "thing", but not cheap at all.