Have you actually done this? Know anyone who has? This seems completely implausible, outside of some extreme frugal lifestyle cases (I'm talking "eating garbage dumped by grocery stores" level frugal)...
[1] Googling "average software engineer salary california" shows figures ranging from 107k to 135k, 120k seems to be more or less the median of Google's figures.
Edit: added footnote
You must admit that $40k bonus after tax is a huge, atypical amount of money. It makes your effective yearly income to be about $156k.
It reminds me of the mrmoneymustache.com guy, saying "anyone can retire early! Just look at me, all I had to do was get $1M in stock from Cisco!"
No disrespect intended for you; I'm sure compared to some of your friends you lived frugally. The point I'm making is that to duplicate your living standard today, very few comparable developers would be able approach your level of savings.
Not sure what typical bonuses are these days, but I don't think that's out of line for a big tech company. Certainly stock grants can be much more than that, but it usually takes more than 18 months for them to amount to anything.
[1: I am an engineering manager at Google]
The whole point of the original statement was "I made $X and saved $Y, it's not that hard." But when you examine the X and the Y, they are not representative at all!
It has similar merit to a lottery winner saying, "why can't you win the lottery too? All I did was buy a lottery ticket."
Not being very frugal:
- rents $2000K/mo 1BR apartment (single but wants some comfort in the Peninsula, no hellish commutes from East Bay)
- transportation $200/mo
- free lunch (and possibly dinner) at the company - eating out and groceries $300/mo
- entertainment $200/mo
So far, $36k expenses + $50k savings and you still have $8k left to go on ski trips to Tahoe, Outside Lands and other non-frugal lifestyle expenses.
"A decent 1BR" - It all depends on the definition of decent. I pay $2k for a 1BR walking distance to Redwood City downtown/Caltrain.
But forget about renting an apartment, if you want to save and you're single, having roommates allows you to rent in the Peninsula for much less than $2k/mo.
Also, I added $300 discretionary spending which lets you to cover some of the things you described, and you're left with $8k at the end of the year.
Can you easily save $50k while spending $3k on rent+utilities to live in a fancy apartment in the Peninsula ? Maybe not, but you certainly don't need to be "eating garbage dumped by grocery stores".
Nice strawman :) I was specifically talking about the situation conditional on saving the 100k in 18 months, my comment was a response to the comment above it.
Separate point: your figures seem very low. I thought SF is roughly equivalent to NYC in terms of cost of living. In which case 300/mo is a zero off as an estimate for all food expenses.
Like the article mentions, saving a lot is easy if you're fine with a roommate and living in a non-luxury apartment, but if your housing standards are higher than that then it's tougher.
This is, of course, at the compensation levels talked about in the article. Some companies (early stage start-ups, banks) pay much less.
NYC, not SF, but the difference isn't huge.
Most people are atrocious with their money by either overspending or under-optimizing.
Also, the average apartment in Manhattan (if you do rent without roommates) is pretty close to your cited figure for total monthly expenses. Which means you either lucked out, or seriously compromised on your living arrangements.
I was making $150k/yr, which is pretty standard for a developer in NYC.
> Also, the average apartment in Manhattan (if you do rent without roommates) is pretty close to your cited figure for total monthly expenses.
I take it you don't live in NYC. The average is a useless metric because it's distorted by millionaires and billionaires. Just go on Craiglist and you'll find plenty of suitable apartments in the $2-3k range.
Nobody I know pays more than $3k/m for their apartment. Heck, my friend just rented a beautiful luxury single-bedroom for $2.8k.
In my case, I chose to go for a non-luxury apartment for $1.8k/m. This was definitely a deal, but even though it wasn't luxury there was plenty of space and I even had a back yard.
I do.
> Nobody I know pays more than $3k/m for their apartment.
Few people I know pay under. We live in parallel dimensions I guess.
> In my case, I chose to go for a non-luxury apartment for $1.8k/m.
I don't know what NYC you live in, but this is non-existent AFAIK. I know someone who went all the way to Rego Park (this is really far from Manhattan) to rent a 1BR for $2.5k.
edit I don't know what a 401k is good for (I already have two retirement saving schemes in other countries), mostly did staycations since SF is such a tourist destination.