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Comment by st1x7 | Hacker News Reader

> According to Dan Luu's conservative estimates a fresh grad at a big tech company can safely earn ~$500k post-tax in 5 years. The US median income post-tax is ~$25k, and investing in an index fund has historically earned ~5% average returns in the long run. So as a tech worker, if you can manage to live as 'frugally' as the average American, you can comfortably retire before 30.

The $500k number in the post that he links to seems way off, the $25k median salary is also incorrect (it's closer to $40k).

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> the $25k median salary is also incorrect (it's closer to $40k).

Not according to the government:

> The U.S. Census Bureau lists the annual median personal income at $33,706 in 2018

33.7k pretax is closer to 25k than to 40k post tax.

https://en.wikipedia.org/wiki/Personal_income_in_the_United_...

Yeah, a 25k median national salary was probably true thirty years ago. Has anyone ever tried living cheaply in San Francisco? It's not easy, or cheap. If you plan on working 8-10 hours a day, after commuting an hour or more each way, after five years, you'll go insane.

Move when you retire to a LCOL area.

I managed ~$14k/year of consumption in the early 2010s in the East Bay, as a single guy. $25k/year in SF is entirely doable, especially if you have a partner. Even if not, so long as you're willing to have housemates, it's practical.

I lived in East Palo Alto for a few years during that time. I was able to save some money and pay off some student loans. It was doable, but it wasn't great. Parking, traffic, garbage, noise, theft, and fleas were a constant thing.

I think he means $500k post tax over five years. Not $500k per year.

> The $500k number in the post that he links to seems way off

Assuming 30% tax rate that's 150k gross compensation/year over 5 years. That's pretty average compensation for big tech companies for fresh grads[1]. That also assumes no raises in those 5 years.

[1] https://www.levels.fyi/

The aim is to have $500k saved after 5 years not just earned post tax. And he does assume pretty big raises to get to that figure - https://danluu.com/startup-tradeoffs/

His assumption is that you can start at $130k and get an additional $30k each year for the first 4 years. And do this while not in an expensive city. That's the part that doesn't seem realistic to me.

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