- Differentiating based on location can create an HR risk/burden.
- After you subtract out living costs, people living in a more desirable area still end up better compensated because they live in a more desirable area, with the associated cost difference subsidized by the employer.
That doesn't make any sense. The cost of living isn't just because there is more value there. It's often times because of idiotic housing policies.
A software developer living in LA is receiving no better compensation than one living in Miami just because the housing costs more.
Now all your expenses are 6% lower, but your money left after expenses is also 6% lower. That means that despite being no worse off in terms of quality of life, your savings went down 6%.
Strictly speaking, if you maintain the same relative ratio of costs to savings, it’s always rational to take the highest income, even if it’s in a higher COL area. This is because costs can be measured as a percentage of income, but savings ought to be measured as an absolute value.
A home requires expensive upkeep. They can be destroyed through natural disasters, or rendered undesirable by changing fashion tastes.
Investing your money in a broad index fund over 30 years would almost certainly provide much more growth. You can sell your position in a matter of minutes, there’s no maintenance cost, etc.
Short term market fluctuations could reduce value for a time, but over a 30 year time horizon, you’re basically certain to do well.
A 200k home in 1980 is probably worth about 2 million today in SF. It's for this reason I'll never move anywhere near there, I just don't see myself being to afford it even, if I do become a rockstar ai developer or something. I personally would like though for people outside SF to get more remote opps at higher rates than elsewhere, maybe even just drive up the freelance/conctract rates, although I think a lot of contract rates have to do with levels of imposter syndrome, I'm an intermediate dev, who is probably comparable to some senior devs by now, but still feel like I'm charging too much if I go above $50/hour, but part of me knows I can get $100/hour.