In from the UK and earn about a quarter as much and I could be unemployed for several years before I had to start caring.
I'm not trying to brag. My salary is shit compared to the US. Just genuinely curious.
Imagine a tech couple earning >$400k, combined income after tax about 20k a month. Awesome right?
Now they need a house with square footage for kids to play and sleep, a home office, and close enough to downtown to maximize family time.
That housing runs at least 5k/mo. A nanny is another 5k. Add in food, bills, transportation, a few yearly trips to see grandma, another 5k.
Said couple might be saving 50k/year. Great! And after a few frugal years together that makes a 10-20% home down payment and they can start their family.
But even though they're both well paid, they're really twice as vulnerable. Either one losing their job puts them at a rapid household burn rate.
Something will have to give. The Nanny loses their job, trapping one parent into a caregiving role. Or they can no longer afford flights to see family. Etc.
Fertility rates and birth defects forced our hand. Saving longer just raises your chances of holding nothing but blood and ashes at the end.
We do quite well, living well within our means, allowing us to be able to cover these types of big once-in-a-home owner’s lifetime surprises, but a layoff could mean we’re simply making the place nice for the next folks while we bail out to find something new.
Life ain’t cheap and the social safety net has been used and abused to the point bad timing can destroy everything you’ve worked for with one unexpected meeting with HR on some random Tuesday.
Nothing’s ‘wrong’ with it but it does make it hard to empathise with someone who subjects themselves to that lifestyle then worries about being laid off.
From some people’s perspective a pricey depreciating car just represents a choice to shorten your runway if things go wrong.
I have a large extended family who all make far less than me. Yes, they have plenty of kids, too.
Their secret is living outside of a tech hub, and near family. It takes a village to raise a child. Their village is free, mine isn't.
> when I look around where I live I see people are just outright mismanaging their money with frivolous luxury items
No offense, but you're either a robot or a sociopath. "Frivolity" is often what motivates humans to get out of bed and go to work, rather than sink into something like substance abuse.
I, personally, budget about $10k/y for motorcycles and art, which are definitely frivolous personal pleasures that don't directly benefit my family. Except it brings me joy, and who knows how productive or alive I'd be without it.
Hoard your treasure in a cave like a dragon if you choose, but spitting on others for finding a different balance is definitely unempathetic.
We are very privileged to have the money for a nanny. Having to let go of a wonderful employee and friend is itself worth plenty of anxiety.
And we're lucky enough to be citizens. Plenty of folks in our situation aren't.
That's not even anecdata, that's just first glance impressions!
$200-300k is not normal in the US and if you are getting fired from one of the few firms paying that much you might have some elevated anxiety that it will take a lot of effort to find another job with such a pay and perks.
But if you are a part of a massive layoff and you read that other such firms are going through layoffs too then you are really afraid that you might not be able to get an equivalent job in the near future as your former colleagues will be competing with you for the reduced number of these high-paying jobs left.
This is what is really dangerous about remote work to the status quo: if I take a SWE salary to a low CoL area, I don’t have the same pressure to burn through it like in a tech hub. I can live comfortably compared to my neighbours and still save. This gives big business far less leverage.
And like with a lot of "new money" experiences, the answer to your question is: no. You get excited to taste a luxury lifestyle and get carried away buying an dangerously expensive house because it fits your Peleton and your bank says you're good for it. With this being your first time through a tech boom, you didn't believe the old cynics telling you there was a second act coming. But now you might get laid off and have $15,000 per month in bills to pay lest that house go back to the bank.
It's an understandable story, and a tragic one. :(
In addition to the other responses, two major factors for me:
1. At the time, I wasn’t making anywhere close to that salary. The tech job market in my region at the time didn’t pay anywhere close to SV salaries, and even less as someone working tech at a non-tech company.
2. I only had a few years of decent earnings at that point, and was funneling most extra funds into debt.
Having enough savings to quit for a few years is amazing, but a privilege that few people have.
Luckily you live in a still mostly civilized society, where you don't lose your health care when you lose your job, and you have a decent welfare program so you don't lose your house and can still eat.
We don't have that here. Also, in the Bay Area, $300K will barely get you by if you bought a house in the last five years.