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Comment by djohnston | Hacker News Reader

You make way less money than your peers in California and everything is still as expensive. It's a financially horrible decision if you can work in the US. If you want to work in Europe though it's pretty good.

I've worked at FAANG in US and UK and am currently going back to the US for non-financial reasons. I don't regret being here but I find London to be impossibly expensive to build a family in.

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It's interesting that you have lived in both and can do a fair comparison. There was a reddit thread a while back that compared US and UK salaries.[1] The consensus seemed to be, that if you compared the cost of living, you would need a considerably higher income in the US to have the same standard of living as the UK. One person said that 130K USD salary in the Bay Area would be equivalent to 50K GBP in London.[2] Another person said that 100K USD in the Bay Area is equivalent to 50 GBP in London. [3]

It would be great to get your feedback on this.

[1]:https://old.reddit.com/r/UKPersonalFinance/comments/nhe8v1/w...

[2]:https://old.reddit.com/r/UKPersonalFinance/comments/nhe8v1/w...

[3]:https://old.reddit.com/r/UKPersonalFinance/comments/nhe8v1/w...

> The consensus seemed to be, that if you compared the cost of living, you would need a considerably higher income in the US to have the same standard of living as the UK

While this does have a partial truth to it, the examples are delusional. How can anyone compare 50k GBP to 130K USD?

I have lived across the USA, EU, and Asia; but such comparisons are heavily personal situation dependant. The calculations would differ for single vs family as well.

I’ve also lived in the UK and US, though did not work for a FAANG in the UK.

By the exchange rate right now, 50k GBP is around 65k USD. If you want to live within (say) an hour reach of an office, you’ll have a much easier time doing that in the London metro area with 50k than you will in the Bay Area with 130k. This is before you even consider taxes and healthcare. High quality groceries also substantially cheaper in the UK. A new wildcard is the price of energy, which looks to have gone up considerably in the UK since I left, though.

Neither would be a comfortable position, and you wouldn’t be in danger of being able to buy a house absent other income. All in all though, if they were my fixed options, I’d take the money in London.

Anecdotally, 10 years ago, two people could rent and live comfortably in zone 1 (just a few minutes from work) with a salary of ~50k. A few salary bumps later we managed to buy a flat in zone 2. Prices of flats have gone up (but not as much as houses) and so has cost of living, but I would say that two people or even a family will live more than comfortably in London on ~100k, manage to save some money and even be able to buy a flat, given a reasonable deposit.

Houses, even small ones, in zone 1-2 are now prohibitively expensive, but if you are willing to move further away there are options.

not only there are options, but there is excellent transportation in London, especially compared to the driving hell because of the all day traffic all around Bay Area. Another parameter I don't see people mentioning (not surprisingly, since its HN after all) is the monoculture in Bay Area, versus living in one of the few global metropolis. In the Bay all you see and live is tech, in London tech is only a part of the overall life experience.

But yeah, overall it's highly personal depending on personal circumstances than anything else.

Very much agree.

Regarding transportation, I have been living here for 13 years and still don't own a car.

Like I said, it depends on your circumstances. If you /have/ to live in the center of a metropolitan, SFO and LHR are equally bad - I have friends in both areas.

I still wouldn’t compare 50k GBP to 130k USD.

I moved from SF to London in 2010 and back in 2014. I was working for a startup at the time, so not FAANG, but also salaries weren't anywhere near what they are today.

My experience is you can't really compare salaries directly, you really need to think about your personal lifestyle. First, if you care primarily about money then there's no substitute for being in Silicon Valley. After that it gets more complicated, basic cost of living like food and going out to the pub is cheaper in London, but high end goods are more expensive and the 20% VAT really hurts. People are generally calibrated on less material goods than the typical American is used to. That includes smaller flats and spending a greater percentage of your income on them. On the other hand though, you don't have to worry about health care, and you don't need to own a car because public transport coverage is solid, and the majority of places have at least decent walkability with some local shops. Overall I would say if you're interested you need to look at potential salary and rents and figure out if it works financially, but don't expect to make equivalent as the US and stay on the same financial trajectory—it's apples and oranges.

3bdrm house in London is basically $1m. This is on par with the Valley. I am surprised salaries are not higher.

I am not sure what you mean by less material goods... I don't think that's true or really means much of anything. Not having space means less stuff in general anyway cause you have to put it somewhere.

Agree. I’m a US citizen who lived in London. The cost of essentials are actually very affordable in the UK. Your lifestyle excludes the need to acquire material goods. If earning money is your primary focus, I would choose the US. These are my prime earning years and am happy to be here. Otherwise, I found the UK to be an amazing place to live. I look forward to hanging it all up and returning to a quiet village in the Cotswalds.

130K USD salary in the Bay Area

It's worth pointing out that this is below FAANG range. A software engineer with zero years of experience in the US should make roughly $160K-190K in compensation at the large tech companies.

https://www.levels.fyi/?compare=Amazon,Google,Facebook,Apple...

In the Bay Area, the cost of real estate will dominate your cost of living. If you are happy to live in a 1-bedroom apartment, that entry level FAANG software engineering job will pay for everything you need in life and more. If you want to buy a house for your spouse and three children, it will start to depend much more on precisely where you want to live.

Unfortunately a 5 bedroom house in Mountain View will run you maybe $3.5M. But it depends a lot on where you go though. Look out in the San Jose suburbs and the same house might cost half as much. I don't know much about the London real estate situation so I can't speak to it but if you really want to compare cost of living for software engineers you probably should look specifically at housing, rather than comparing general statistics.

London housing is expensive, but I think still significantly less than SV.

It isn't really worth pointing that out, because GP's quote was '... is equivalent to £50k in London'. (Which is also below FAANG range, but that's still besides the point.)

> One person said that 130K USD salary in the Bay Area would be equivalent to 50K GBP in London

I don't know how expensive the Bay Area may be, but 50K in London (3100 per month) are barely enough to pay rent (2000 per month) and definitely not enough to send a child to nursery (2000 per month).

I think you are correct that yu need approximately 2x salary in the United States to maintain the same cost of living as in London. However with larger companies, you can usually make 3x or even 4x working in California compared to what they pay in London.

A few years ago FAANG salaries in London were pretty weak, but they’re much better now and even within the startup ecosystem — traditionally much lower than FAANG salaries here — £90k is a reasonable base expectation and £100k at a minimum for FAANG (>150k TC is normal).

On £100k London is pretty affordable, so I’m curious, how much were you making in London and what do you consider to be a required salary to start a family here? London is very expensive but I’ve not heard the sentiment that FAANG salaries aren’t enough — would be helpful to learn more specifics of your view!

£150k is much, much less than non entry level FAANG engineers in the US are making.

£150k is ~$196k base. I don't really see how that's much much less? My friend is an L6 at 220k base (with a shitload of equity). Definitely within the range.

Workers in UK also work less than their US counterparts (paid holidays, parental leave, sick days ...) [1]. Would make more sense to compare these countries by hourly income, not yearly.

[1] https://en.wikipedia.org/wiki/List_of_countries_by_average_a...

My (current) experience is that the London teams at my FAANG work no less than the US ones, and indeed often much later into the evenings to accommodate meetings. And everyone works fewer hours than those in finance.

Base is not that important especially at L6. How much stock is your friend getting?

150k after tax, pension and healthcare or before?

UK/Australia/NZ tend to talk about Base salary (excludes bonus/health care/before tax).

Is that different elsewhere?

Edited to note this is "Base" not "Total" Salary

Salary in the UK means just the cash part of the package. Before tax, pension, healthcare, stock, bonuses and any other perks.

At least in UK, pension is usually on top of the quoted gross salary (Usually it is at least 10% more). But otherwise yes, the figure is before tax.

Adjusting for benefits etc. it's not that different but my point is that £150k in London is a great salary on which someone can live very well, regardless of what you can earn in the US.

150k USD is around what you'll get with 2-3 years of non-FAANG experience in the US, so not that bad for London.

Really non fangs pay 150k? Where?

£100k London as a single person could definitely buy a flat somewhere. Maybe not a great area but it's doable.

A house with a garden, kids, private school etc. 100k won't cut it unfortunately.

For some reason I thought FAANGs in London were paid really well but seems like contracting or finance is the only way to get a reasonable income.

I have a buddy who was working for a DeepMind and now works for Google (UK). His salary is £140k. Meanwhile day rates of £600 per day are pretty standard and pay the same for arguably less hassle.

I agree with everything you said aside from: "For some reason I thought FAANGs in London were paid really well but seems like contracting or finance is the only way to get a reasonable income."

Even in London £100k is above a reasonable income for one person. It's not enough to buy a house and provide for a family on one income and still have no worries, but expecting that is unreasonable. It's really easy to get stuck in a bubble where we forget that six figures is crazy out of the ordinary for an average person.

But as to your main point. Yeah finance and contracting really is the right way to go to get a high income. Though I think this might be changing with the contracting as there were some recent changes that make contracting less efficient tax wise, and could push high performers to either ask for more, or just move to being an employee.

It's really out of the ordinary when you're in the top 1% and can't afford a decent life - meanwhile lower middle class people who bought before QE (15 years ago) can afford a decent life.

We shouldn't be lowering our "unreasonable" standards. If you're in the top 1% in income - you should have an complementary lifestyle. Not just be grateful that you're not in complete financial misery like everyone else your age.

You should pay more attention to household incomes than individual incomes, because housing is a per-household expense. Even if you are a high-income individual, you may still live in a mid-income household. In most large cities, being mid-income means you can afford to rent in most areas or buy in cheap areas.

Income is so unevenly distributed that if you're in the top 1% of personal income, you're in the top 3% of HH income.

Assuming you're single and in the top 3% of HH income (top 1% personal) - you have 2.1 less persons to provide for. You should probably be better off than two people with a kid. You need less bedrooms and floor space, that's for sure.

If you can't find a decent 1 bedroom in town - I feel sorry for the family shopping for a 3 bedroom on a slightly higher income that has most of that extra income going directly to the tax man.

I don’t think it’s unreasonable to expect that someone in the top 10% of incomes should be able to buy a house.

Top 10% of household income with some savings for a downpayment should indeed be able to purchase housing if they choose to tie themself down that way.

It’s not necessarily the case that top 10% individual income means you’re top 10% household income (and the top 10% household income can obviously bid more for housing than the second, third, or farther decile of household income).

A household (not individual) income of £100000 is sufficient to be well inside the top 10% by income. Using the standard ratio of 4.5 times income for a mortgage means that you are capped at houses costing around 560k, assuming you have 20% to put down.

The following search for 3 bedroom houses [1] provides either flats, maisonettes and a few houses in areas with poor transport links, and many of these are still over budget.

[1]: https://www.rightmove.co.uk/property-for-sale/find.html?sear...

What's wrong with a decent flat or maisonette?

I agree with your general point that housing is too expensive! I'm just curious.

Not as nice as an house, but having lived in one for a 10 years, they are perfectly fine homes.

An usual downside is that technically you never own it.

Nothing is wrong with purpose-built flats or maisonettes - I personally live in a high rise! Most people I know looking for a place to live with a family etc are looking for a house though.

The downside of contracting though is that the work is typically the work full-time employees don't want to do. You gain in flexibility, but lose in enjoyment -- enjoyable contracts are a minority. Specific to the point on finances: there's typically 250 billable days in a UK year so £600/day is £150k/year. There are tax benefits to contracting, so it's not a one-to-one relationship, but £150k/year salaried is better than £600/day for most people.

Yeah you're right there. 150k salary is better than a £600 day contract.

£150k per year is tricky to find for salaried positions as a dev. They exist but not as visible (to me at least) compared to the contract equivalents.

The enjoyment side is something I hear mixed opinions on. There are plenty of "disguised employment" type contracts in the UK that just go to contractors for rarer skill sets. YMMV.

I agree. I left £800pd for £150k salaried for work interest reasons mainly, but tbh I haven't noticed the reduction in monthly income at all.

Reminds me of Martin Hairer commenting on what he is going to do with his $3m breakthrough prize-money: “We moved to London somewhat recently, three years ago, and we are still renting. So it might be time to buy a place to live." [0]

[0] https://www.theguardian.com/science/2020/sep/10/uk-mathemati...

I wonder, is moving from UK to US easy within a FAANG company? Is that something people do?

It really does depend on the company. Within large companies, there is often a structure that lets you do that. There will be internal job postings, you can apply, get interviewed, accepted, and then the hiring manager begins the process to transfer you over. Visas, processing fees, moving costs, things like that.

The level you're working at matters too for visa reasons. If you can qualify for an L-1 visa, it's one of the easiest ways to get from the UK to the US: https://en.wikipedia.org/wiki/L-1_visa

Yes but it can tie your hands promotion wise.

Why would it?

L1's are based on functional role so IC specialized knowledge(L1A) vs manager (L1B) cross promotions are difficult.

In the UK your family will be covered by the NHS. There is a welfare state. Don’t discount the value of the EU welfare state when it comes to raising a family.

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