That's the problem. Salaries on job hunting sites are wildly inaccurate. Glassdoor lists FANG compensation as 2-3x less than what they actually pay.
Also, the important metric isn't COL adjusted income; it's the total amount of money that's left over to save/invest after all other expenses. So it doesn't matter that CA has high income tax or that rent costs $50k per year when you're still able to save significantly more than anywhere else in the U.S.
1) You don’t aspire to own a home here, as that will eat easily 100% or more of your savings.
2) You plan to spend your savings in a cheaper place.
USD is a convenient shorthand for purchasing power, but breaks down under huge regional COL differences. A $200k savings account in the Bay Area is like a $50k savings account elsewhere: about enough to think about setting up a middle-class grown-up lifestyle.
Which probably won´t be the case for most people working there now.
Thats achievable in 5 years for someone who is working towards that goal specifically, less if you have a partner who also works. Anecdotally, I know two couples (out of not many total) that purchased within 2 years of moving to the bay. One had some savings, and that plus the first years stock vests was enough for a down payment on a condo. The other took ~2 years to buy a home from very little prior savings, which was possible because both had decent incomes.
So I'm dubious as to the doom and gloom, at least for married professionals.
(Of course, this ignores the reality that for anyone not working in tech or 1-2 other fields, these are wholly out of the picture, and that's hugely problematic! But for the calculation of CoL for someone who is picking between tech companies, I think people overestimate the costs of the bay, and I'm not really sure why)
Remember that, as you save, housing appreciates. I've run the numbers; the lines only intersect at all for more conservative % increases, between 8 and 12 years out.
I wish I’d gotten into software sooner. If you come out here at 22, live with roommates and stay until you’re 30, you probably take anywhere from $400-700k in savings with you to then have a much easier life somewhere else.
That’s why people do it, especially when they’re young.
Also in terms of math, you need to know that the big companies here pay about 50% via salary and the rest via bonus and stock, so the salary numbers you see are only the “live day to day” money. The other half of your income comes in big checks every quarter or so, which makes it easy to shovel that straight into savings.
I could live without one, my rent would be marginally more, though I'd still probably bank close to the same. But the social aspect is really nice.
So it really isn't giving up your youth or anything. And many young people even enjoy the city of San Francisco. It is a big city. Lots of stuff for young people to do...
Yes there is, actually. It is called "working for one of the big 5 tech companies/or one of the unicorns".
200k+ total comp is the norm for someone with a couple years experience working at one of these places.
And god knows how much the people with 10+ years make. A Google L6 (staff engineer) makes something like 450k?
Source: I'm keeping a pace of 1 promo / 2 years in Google. I've seen people going both faster and slower (and some stopping at L4, because why bother).
And with 15 years of experience I was being groomed to be promoted from an L6 to L7 "Uber Team Lead"... it wasn't easy and wasn't coasting, took a ton of very hard very impactful work... but it's possible for a mere mortal.
Google, Facebook, Netflix, Linkedin, Airbnb, Uber, Lyft etc. typically^H^H^H often pay $400-500k for someone with that much experience who can be a team lead.
If you can be a more senior architect-type person, or a manager who manages managers, 7 figures can be within reach (though not easy).
This is why you're losing coders to Silicon Valley. If you want a big house, then yeah, that will be $2M and you might be better off making $150k in the midwest. If you're happy with a two bedroom apartment for $4k-$5k/mo, there is no place better.
For good or ill, people tend to fall out of the funnel as they hop from job to job.
And there are things to spend it on here. Heck many in their thirties do this.
Or live in a nice area for 800 a month. Or live in a shit area for 400.
SV math does not work out. You are taxed to much. Pay to high rent and have the pleasure of needing a shit map to walk in your city.
I keep seeing this same argument about getting to pay 1.5k to live with a bunch of other people to save some money.
No thanks.
Or in my case, a 5 bedroom house with a mortgage of $850.
We paid ~$125k for ours, in a semi-rural area, last year.
It blows my mind that people would prefer to live in the Valley or elsewhere. I put in my five years in a higher COL area (Charlottesville, VA) to build my earning potential - and then I moved back to where I grew up as soon as I was confident that I could hold down a well-paying remote dev position and could get another one if the need arose.
The disparity between the coasts and "middle America" is insane. Working for a company based in the LA area, I make literally 2-3x what my colleagues are making working for local companies - while my employer pays me probably around half of what they'd have to pay for similar talent local to them.
Sure it does. For one, they're taking home an extra thousand dollars per week in SV even after all the taxes. Also, they don't have to live in Birmingham, AL or whatever the hell.
Your hell hole is other people's heaven; navigable traffic, lakes galore, proximity to clear, warm, clear oceans. Backyards with trees, playsets, green grass.
Warm to hot 10 months of the year.
Last year for thanksgiving we were in Knoxville. Was looking at abandoned warehouses that I could flip. Downtown is tiny but nice and supplemented by the university. I’d have to take up rooting for the vols tho.
I was LUSTING over this place though (https://www.google.com/maps/@35.9679553,-83.9199396,3a,60y,4...) was for sale at $2.2M when I was there last year. If only I could sell my house for 2x and I could think of a business to keep that place maintained would be about as dream of a place as I can think of.
And that assumes you want a 5 bedroom house, I have zero interest in that right now. Too much space to take care of. Why would I do that?
And why would I go somewhere with fewer things to do. I attend social events 2-3 times a week. I've checked elsewhere, that would drop to 2x a month in Atlanta and less in a less populated area, unless I picked up more hobbies.
In Atlanta theres a couple things a month. Anywhere super rural that isn't a college town, I'd be lucky to find dance partners my age.
I'd maybe pick up other hobbies again (I used to play magic the gathering but stopped in college, FNM is in a lot of places), but it's not the same.
Some people prefer saving and looking for other forms of stimulus other than the acquisition of space. For those of us, the fear of living "some place in the south" amounts to:
"The cells just say, 'that's it', and you, the unwary victim of cellular ennui, are quite literally bored to death."
This isn't true in the slightest. You can easily make double or more in a top tier tech city like SF/SV as you can in the south. My salary is about 7X higher than when I first started in tech over a decade ago at a smaller IT consulting firm (and note that my starting salary was decent for the area, not horribly low-balled). There's no way that would have happened had I stayed where I was instead of moving to a top tier tech city offering the highest salaries.
I'm saving twice as much per year as the average developer in the country makes. That's definitely not possible in the south.
Working a 60 hour/week professional job to live like a 1890s garment factory worker sounds... unappealing.
https://newrepublic.com/article/113176/science-loneliness-ho...
There are many young software engineers working at Google/Facebook who would be able to save significantly more than the median US household income per year while renting their own place but still choose to live with roommates.
This is false for software engineers in the Bay Area. Can they save more by living with roommates? Sure.
But they wouldn’t be “financially distressed” or “unable to save money comfortably” if they didn’t - that is easily verified by looking up new grad salaries and rents in the Bay Area.
It’s simply a rational decision - these are people who were living with roommates in college and by continuing that arrangement can save more, live in a better location w/ more amenities, and quite often share a place with friends - win/win/win.
That's true everywhere. Yet the overwhelming majority choose not to have roommates.
Nothing like a garment factory worker.