5 ms·

For most purposes, what matters is what you earn in comparison to the economy you live in. For example, if you live in a place where people make $12,000/yr, on

For most purposes, what matters is what you earn in comparison to the economy you live in. For example, if you live in a place where people make $12,000/yr, on average, then earning $24,000 is a nice living. In the US, software engineers often make north of $200k/yr, but a single family home in a lot of US cities is $500-800k, putting a new roof on your house costs $15-40k, and a dinner out at a sit-down restaurant costs $30-60 per person. If you earn $24,000, but it costs $8 to eat out and $80k for a decent house, that's not too shabby. Where are you located, if you don't mind sharing?

RGamma 2y ago
60 / 200k < 8 / 24k, 500k / 200k < 80k / 24k ~(666k for same ratio on the higher salary) Not accounting for taxation, other CoL and all that, but your example doesn't really work out. Just to put this into perspective: In Germany average fulltime wage is rougly 54k ~= 34k after tax and social security. Average price of building a new 150 m^2 (living space) home is 400k-500k.
toast0 2y ago
I think there's a lot to location relative thinking on this, but if you're generating a surplus, it's worth thinking about the actual value of the surplus, because your savings are portable. Ex: if everything is relative, and you can make double the average and save 10% regardless of location, you'd have a lot more savings if you lived where costs were much more, because 10% of $200,000 is a lot more than 10% of $24,000. And then after several years of working, you might move to the low cost area and retire. More likely, things aren't really that equally relative. So you'd want to estimate how many dollars you could save in low cost location and the high cost location (and add in factors for non-monetary concerns, like stress, natural beauty, access to things you like to access, and work authorization)
hiAndrewQuinn 2y ago
Having moved from the US to the EU a few years ago, I can only say from my lived experience this is not true at all. More money really does buy nicer things pretty much across the board. I would far prefer to make $200k and buy a $500k house than to make $20k and buy a $50k one. Similarly making $2m and buying a $5m house would be even better.
StefanBatory 2y ago
I know, but I'm curious. I'm Polish. Here I'd say I can expect an average wage of somewhere around 6 to 8k PLN should I have few years of experience as a software engineer; that is around $1.5k - $2k ($1 = 4 PLN is a good estimate even if it can vary at times). Minimal wage is 3.5k PLN, so ~$880.
JustExAWS 2y ago
It’s not the difference between $24K and $200K. If you are “senior” developer at an enterprise CRUD company making $160K, do the leetcode grind and probably be down leveled to a mid level developer making $250K-$275K living in a high cost of living area , it gets more nuanced. If you are single and living in an apartment, the difference in rent will still make it worth it. But if you are trying to duplicate the big house, in the good school system with 2.1 kids and a stay at home spouse, the numbers change where it’s not worth it.

RGamma 2y ago

60 / 200k < 8 / 24k, 500k / 200k < 80k / 24k ~(666k for same ratio on the higher salary) Not accounting for taxation, other CoL and all that, but your example doesn't really work out. Just to put this into perspective: In Germany average fulltime wage is rougly 54k ~= 34k after tax and social security. Average price of building a new 150 m^2 (living space) home is 400k-500k.

toast0 2y ago

I think there's a lot to location relative thinking on this, but if you're generating a surplus, it's worth thinking about the actual value of the surplus, because your savings are portable. Ex: if everything is relative, and you can make double the average and save 10% regardless of location, you'd have a lot more savings if you lived where costs were much more, because 10% of $200,000 is a lot more than 10% of $24,000. And then after several years of working, you might move to the low cost area and retire. More likely, things aren't really that equally relative. So you'd want to estimate how many dollars you could save in low cost location and the high cost location (and add in factors for non-monetary concerns, like stress, natural beauty, access to things you like to access, and work authorization)

hiAndrewQuinn 2y ago

Having moved from the US to the EU a few years ago, I can only say from my lived experience this is not true at all. More money really does buy nicer things pretty much across the board. I would far prefer to make $200k and buy a $500k house than to make $20k and buy a $50k one. Similarly making $2m and buying a $5m house would be even better.

StefanBatory 2y ago

I know, but I'm curious. I'm Polish. Here I'd say I can expect an average wage of somewhere around 6 to 8k PLN should I have few years of experience as a software engineer; that is around $1.5k - $2k ($1 = 4 PLN is a good estimate even if it can vary at times). Minimal wage is 3.5k PLN, so ~$880.

JustExAWS 2y ago

It’s not the difference between $24K and $200K. If you are “senior” developer at an enterprise CRUD company making $160K, do the leetcode grind and probably be down leveled to a mid level developer making $250K-$275K living in a high cost of living area , it gets more nuanced. If you are single and living in an apartment, the difference in rent will still make it worth it. But if you are trying to duplicate the big house, in the good school system with 2.1 kids and a stay at home spouse, the numbers change where it’s not worth it.