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Comment by NamTaf | Hacker News Reader

As a sort of tangent to your point, it is however beneficial to move to a high-cost-of-living area if you can get a roughly equivalent quality of life outcome. That is, if you can get a salary increase in line with the cost of living increase, it is worthwhile because it essentially deflates all other non-locale-related costs.

For example, the $100 shirt off Amazon is suddenly far cheaper relatively speaking. So is the new phone or laptop. Ditto, overseas trips become much more affordable relatively speaking.

I know it's not related to your original point much except that we're discussing regional cost-of-living disparities. I've just been thinking about this a bit, as I come from a high-cost-of-living country (Australia) and am considering moving overseas to locations that offer a lower cost of living (not that it's my impetus for doing said move). It's a factor I hadn't previously considered and does actually have some significance.

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Your point is definitely valid. If housing costs double and salary doubles, you will have more income for things that don't change price like shirts and laptops in the high-cost area.

However, one of the things you lose in high-cost areas is freedom. You lose the freedom to pursue passions, take time off from work, try out a job you think you might love but pays 30% less, etc. I can delay or forego the purchase of a new shirt or laptop to prioritize something else in my life. Maybe I want to work for a non-profit I find compelling or spend time with my children. The high-cost area isn't high-cost for discretionary spending. It's high cost for essential spending.

If I need $75,000/year on housing, I can't afford a pay cut; I can't afford part-time job and part-time parenting; I can't afford passion. $75,000/year might sound like a lot, but the median home in San Francisco is going for $1.35M. After a 20% down payment, mortgage payments would likely be around $65,000/year. Add on another $10k for taxes and we're at $75,000 for a median home.

Let's say I could earn $250,000/year in San Francisco and $100,000/year in Chicago. In Chicago, the median home is $300,000 so we're talking $15,000/year in mortgage payments instead of $65,000. Let's assume that I pay 30% of income in tax on $250,000 and I take home $175,000. After $65,000 in mortgage payments, I'm left with $110,000. In Chicago, If I pay 25% in tax and $15,000 in housing payments, I'm left with $60,000. That's certainly less, but I've also gained a lot of freedom. If I want to take time off, my expenses are low. If I want to switch to a career earning $50,000/year, I can still live my life. I'm not being forced into specific employment based on cost of living.

If we adjust the numbers slightly and make SF $200,000 and leave Chicago at $100,000, the gap quickly closes. Assuming 28% tax on the lower income, we're talking $79,000 vs $60,000. A little more disposable income, but very little freedom.

SF salaries are certainly high. Are they 2.5x higher? Even if they are 2.5x higher, do you really feel good? I guess a part of me feels like life should be easier and more comfortable. I'm not looking for fancy shirts and yearly expensive laptops. I'm looking for the comfort of knowing that if something goes medically wrong, my cost of living isn't so high that I'm very quickly on the bubble. I'm looking for the ability to be able to choose different life priorities in my future if I desire. We all make our own decisions, but I think there's something intangible that lower cost of living provides.

>Even if they are 2.5x higher, do you really feel good? I guess a part of me feels like life should be easier and more comfortable. I'm not looking for fancy shirts and yearly expensive laptops. I'm looking for the comfort of knowing that if something goes medically wrong, my cost of living isn't so high that I'm very quickly on the bubble. I'm looking for the ability to be able to choose different life priorities in my future if I desire.

Yep - this is something I hear a lot from my colleagues in the Bay. "Can I afford to keep my kids here if my wife gets hit by a bus?" ; "If home values dip, will I ever be able to pay off my mortgage and move elsewhere?", etc.

> SF salaries are certainly high. Are they 2.5x higher? Even if they are 2.5x higher, do you really feel good? I guess a part of me feels like life should be easier and more comfortable. I'm not looking for fancy shirts and yearly expensive laptops. I'm looking for the comfort of knowing that if something goes medically wrong, my cost of living isn't so high that I'm very quickly on the bubble. I'm looking for the ability to be able to choose different life priorities in my future if I desire. We all make our own decisions, but I think there's something intangible that lower cost of living provides.

Yes, yes they are. Sure, the economic boom has contributed to the skyrocketing value of equity compensation leading to some pretty insane incomes. But it is what it is... for now at least.

I totally agree with you. In my case, I countered with a proposal for roughly 3x my current income, which would have maintained roughly similar quality of life, if not some minor improvement. The client balked, mostly because they're not a tech firm and aren't used to paying folks outside their primary money-making departments that sort of salary. But if they had agreed, I definitely would have moved to SF.

There are reasons real estate is more expensive in the bay area, and it's not just NIMBYs. Even if you build to the sky in SF, real estate is going to be much pricier in the bay area than Houston. Not caring about the things that make the bay area market pricier is an arbitrage of sorts for you. The heat and hurricane weather alone are enough to make Houston a non-option for many people, myself included.

>The heat and hurricane weather alone are enough to make Houston a non-option for many people

A factor in my favor: I'm a native, so it doesn't bother me. Same goes for most others that have lived in swamplands during the summer (even places like DC and Chicago have nearly identical summer weather compared to Houston).

I'm afraid you're mistaken about Chicago summers being nearly identical to those of Houston. Chicago has experienced summers without a 90˚ day and quite a few people there have no AC.

That could be a smart move in the end. If the salary is 3x what you’re getting paid in TX you could be one of the first people they’d look to lay off in the event of a cutback.

I heard that usually the lowest-paid employees are fired first.

This was a big part of my decision to move to SF after college, but it turned out not to be true. A down-payment-sized savings goal is insatiable. Even if a fancy car or vacation or whatever is cheap as a percentage of income, you can't justify it, because the money could be inching you closer to homeownership instead. You're in no danger of ever actually reaching "enough" savings, so the excuse for luxury consumption never arrives.

"Equivalent quality of life outcome" is also tricky. Growing up, my parents drove ~7 miles from our sleepy, affordable suburb to the city center in 20 minutes. 7 miles in 20 minutes! Could you imagine such a thing? When I first moved here, I chose a similarly-distant unsexy suburban location; the transit commute worked out to 80 minutes door to door. To get a 20-minute commute here, I had to move to one of the most central, premium locations.

Not to mention the relative cost of student loans, and relative worth of savings that you do manage (ie enough for a decent house elsewhere when you’re ready to gtfo).

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