For those who live in HCOL areas, how much do you need to make? What do HH incomes look like? I've tried using conversion calculators but they don't seem accurate.
I'm sure things depend on lifestyle factors, children, preferences in housing, etc. but do you think people really earn more substantial incomes based solely on the location/COL?
ETA more details... Here is what our 'stats' would be: 2 adults, 1 cat, no kids (ever), no current loans/debt
Would like: SFH, 2 beds would be fine, probably could/would rent (we currently do)
Right now our HH income is $162,000. Both in health care (myself a dental hygienist, DH in administration at the director level). LCOL area. I work PT so DH makes wayyyy more than I do currently.
do you think people really earn more substantial incomes based solely on the location/COL?
Of course not.
Well, at least not necessarily proportionate to increased cost of living.
Even the most expensive city is home to somebody who makes minimum wage.
"How much money do you need to make?" is an impossible question to answer.
If you could frame a question more narrowly (e.g., How much money would you need to buy a two-bedroom single family home in Silver Lake with two adults and a child under five?), somebody might be able to provide a semi-credible answer.
Post by sapphireblue on Sept 20, 2017 18:15:01 GMT -5
I am not going to be really helpful here, but I lived in Santa Cruz, CA from 2001-2004. My salary was 45K. I had a rental, a nice cottage, and a used car I drove across the country.
I found the cost of living to be very reasonable in Santa Cruz. My health insurance was far cheaper than when I moved to Rhode Island, and my gas and electricity was also far cheaper. The rent was fairly comparable to places in Providence.
Now, I own a home with a nice yard so if I wanted to have the things/lifestyle I have here in Santa Cruz, I could not do it due to the high cost of real estate there.
I don't think the overall higher salary you earn in SoCal compared to the Midwest makes up for the housing costs. I think people in HCOL areas might get more help from parents with the downpayment and general gift money. It's hard to know who is being conservative with retirement savings and who is living off of debt.
I'm not going to say what we make, but we've always been outside the "comfort zone" of 35% on Money Matters on housing costs. I am dreadfully curious about a lot of my friends HHI and what their financial picture looks like (i.e. how they can afford extensive remodels or new cars), but of course I would never ever ask!
Post by penguingrrl on Sept 20, 2017 18:35:37 GMT -5
I mean, H and I lived as a family of 3 then 4 on under $40K in Manhattan from 2007-2012. Our rent made up roughly 80% of his take home pay and it was really difficult, but we made it work because that's what he could earn, we were way priced out of daycare and it was what it was. We were still in a better financial position than many of our neighbors.
Post by Jalapeñomel on Sept 20, 2017 18:39:14 GMT -5
Too many factors here.
Could I be a single person, no children and live in NYC on $50k? Probably.
With a child and a spouse, no way unless you're willing to live in less than desirable neighborhoods. Even $100k would be hard, especially if you needed full time childcare.
Post by pantsparty on Sept 20, 2017 18:40:54 GMT -5
The average household income for the closest "major" city by us is about $78,000. I know plenty of people making around this range, as a household, and they make it work. Small houses, rent, live in good but not great areas, etc.
We barely put a down payment on our house when we purchased and are paying PMI. I think that's the reality for a lot of people. It's not like the majority of people in southern California are getting huge bonuses, inheritances, etc., and dumping it into housing. I know people for whom that's their reality, but it's not the norm.
I don't think the overall higher salary you earn in SoCal compared to the Midwest makes up for the housing costs. I think people in HCOL areas might get more help from parents with the downpayment and general gift money. It's hard to know who is being conservative with retirement savings and who is living off of debt.
I'm not going to say what we make, but we've always been outside the "comfort zone" of 35% on Money Matters on housing costs. I am dreadfully curious about a lot of my friends HHI and what their financial picture looks like (i.e. how they can afford extensive remodels or new cars), but of course I would never ever ask!
This is a weird generalization. And also why I get embarrassed when H and I do stuff (vacations, new car, etc.) because I'm guessing at least one person thinks we're putting ourselves in financial ruin or relying on our parents.
We chose to live in a less exciting Queens neighborhood in order to own in NYC. It's really helped bring our housing costs down.
do you think people really earn more substantial incomes based solely on the location/COL?
Of course not.
Well, at least not necessarily proportionate to increased cost of living.
Even the most expensive city is home to somebody who makes minimum wage.
"How much money do you need to make?" is an impossible question to answer.
If you could frame a question more narrowly (e.g., How much money would you need to buy a two-bedroom single family home in Silver Lake with two adults and a child under five?), somebody might be able to provide a semi-credible answer.
Here is what our 'stats' would be: 2 adults, 1 cat, no kids (ever), no current loans/debt
Would like: SFH, 2 beds would be fine, probably could/would rent (we currently do)
Right now our HH income is $162,000. LCOL area. I work PT so DH makes wayyyy more than I do currently.
Well, at least not necessarily proportionate to increased cost of living.
Even the most expensive city is home to somebody who makes minimum wage.
"How much money do you need to make?" is an impossible question to answer.
If you could frame a question more narrowly (e.g., How much money would you need to buy a two-bedroom single family home in Silver Lake with two adults and a child under five?), somebody might be able to provide a semi-credible answer.
Here is what our 'stats' would be: 2 adults, 1 cat, no kids (ever), no current loans/debt
Would like: SFH, 2 beds would be fine, probably could/would rent (we currently do)
Right now our HH income is $162,000. LCOL area. I work PT so DH makes wayyyy more than I do currently.
With those stats, you could live in most of the popular neighborhoods in NYC. But in an apartment.
Eta that's just an example. I feel like each area would be similar with a "but" somewhere.
Also, your industry matters. I work in health care, so my salary likely would be similar in many areas of the country. My H wouldn't be able to make what he makes now in any area that isn't a huge metropolitan area.
Could I be a single person, no children and live in NYC on $50k? Probably.
With a child and a spouse, no way unless you're willing to live in less than desirable neighborhoods. Even $100k would be hard, especially if you needed full time childcare.
Even this is far too broadly painted.
Admittedly, working in healthcare and facilitating discharge plans for my patients, I am privy to more info than most (family size, age, occupational status, insurance coverage, and often HHI and liquid assets). But I absolutely have seen families (often multigenerational) thrive on far far far less than $100k. I have retired social workers supporting families on modest retirement plans but with the benefit of rent controlled housing in highly sought after hoods. I have ice cream truck operators, grocers, artists and immigrants ineligible to work who would only dream of $50k but are very proud of their neighborhoods and families.
I don't think the overall higher salary you earn in SoCal compared to the Midwest makes up for the housing costs. I think people in HCOL areas might get more help from parents with the downpayment and general gift money. It's hard to know who is being conservative with retirement savings and who is living off of debt.
I'm not going to say what we make, but we've always been outside the "comfort zone" of 35% on Money Matters on housing costs. I am dreadfully curious about a lot of my friends HHI and what their financial picture looks like (i.e. how they can afford extensive remodels or new cars), but of course I would never ever ask!
Why are these the only 2 options?
They aren't. It's a spectrum, I was just pointing out you never know the full picture. Some people have debt, some have inheritances, some don't save, etc.
My random anecdote: Moving from Midwest MCOL to West Coast HCOL I negotiated a 27% increase when I transferred w/in my company. We're pretty new here and still figuring things out but minus owning a house, I think our 'quality of life' is about the same.
I don't think the overall higher salary you earn in SoCal compared to the Midwest makes up for the housing costs. I think people in HCOL areas might get more help from parents with the downpayment and general gift money. It's hard to know who is being conservative with retirement savings and who is living off of debt.
I'm not going to say what we make, but we've always been outside the "comfort zone" of 35% on Money Matters on housing costs. I am dreadfully curious about a lot of my friends HHI and what their financial picture looks like (i.e. how they can afford extensive remodels or new cars), but of course I would never ever ask!
This is a weird generalization. And also why I get embarrassed when H and I do stuff (vacations, new car, etc.) because I'm guessing at least one person thinks we're putting ourselves in financial ruin or relying on our parents.
We chose to live in a less exciting Queens neighborhood in order to own in NYC. It's really helped bring our housing costs down.
That whole thought process is weird. We've had zero help when it comes to pretty much all major life events. In fact I'm pissed thinking anyone would assume we've been financially helped. Assume we're financially irresponsible but don't you DARE assume anyone is helping us! LOL.
Post by alleinesein on Sept 20, 2017 20:04:03 GMT -5
For me to move out of the house and support myself in a 1 bedroom apartment in the greater San Diego area I would need to make a minimum of $53K a year to be able to pay rent, utilities, car insurance, food, gas, etc. It would provide enough money to cover the basic living expenses and allow me to have a little bit of extra $ each month to cover unexpected expenses or fun stuff. Average rent for a 1 bedroom is just under $1600 a month.
My info might help a little bit. I'm 45 miles south of Seattle and single, work in healthcare. Bought a home and a new SUV within the past 7 yrs. My 3 bd/2.5 bath SFH appraises now for $300,000. Am able to contribute to retirement savings but live a fairly frugal lifestyle. I make $65,000/yr take home
Post by rupertpenny on Sept 20, 2017 20:27:41 GMT -5
I recently applied for a job in LA and have done some looking into COL stuff in case anything actually comes of it. Our HHI would be in the $200-250k range and we would try to live in Westwood to minimize commutes. We will soon have two kids, one in public school. I'm not worried about not having enough money for that lifestyle. We could probably do it for a lot less. I don't mind living in a tiny apartment though.
A while ago MM did money diaries for a week with several HCOL posters posting theirs, myself included. Not everyone posted their income and some have deleted, but it might give a better picture. pandce.proboards.com/board/28/money-matters?q=diary
This is hard question, but one I've often wondered myself since we've been thinking (planning? It's likely going to happen) about moving to the west coast.
Could we survive on our salaries out there? I have no doubt. But I am not interested in significantly downgrading our lifestyles to get to the west coast. Right now we spend 20% of our take home pay on rent (2 bed/1 bath 1300 square foot apartment, we could get by with less space but would still want 2 bedrooms), we take 1-2 vacations (often international but nothing luxury, in the 2-4k range since we utilize points and have family in Europe) per year, our car is paid off, and we have student loan debt that amounts to around 15% of our income in payments (IBR plan). We like to go do things like eat at a casual dining restaurant a few times a month, go to a play, concert, or sporting event several times a year (every 1-2 months on average). We eat and drink a lot so groceries end up costing like $600 a month on top of that. Basically, we live a nice life right now but nothing overly fancy. We make combined about 85k per year. When H is done with his Phd I'm hoping we'd make more like 120-130k combined. If we stay here, we can put a ton of money into retirement, upgrade our rental or buy, and maybe spring for a hotel instead of airBNB when we travel. If we move to LA or Seattle area - could we still take vacations? Would we live in a run down apartment vs a reasonably well kept one? Could we eat out once a week or would we have to cook every night? Those are the things I worry about. I don't doubt we could scrape by. But I have no interest in scraping by, KWIM?
They aren't. It's a spectrum, I was just pointing out you never know the full picture. Some people have debt, some have inheritances, some don't save, etc.
Really, even the question is kind of privileged, isn't it?
Many people can't even ask whether it would work. They just have to make it so.
Of course. I'm not the OP, but I don't think the question was necessarily "how does anyone live in a HCOL area and survive?". I think it was more "if I were to take my current lifestyle and income to a HCOL area, what would my lifestyle end up looking like?". I think that's a fair question, and a hard one to figure out an answer to.
I fully realize people live on minimum wage even in Manhattan or San Francisco. I'm incredibly lucky that I don't have to live in minimum wage anywhere. But I'm not super excited to give up my nice lifestyle in a MCOL area to move to a HCOL area and have to squeeze every dollar if I don't have to. For me, a better understanding of how that shakes out would be really helpful - would I be able to live a comparable lifestyle in a HCOL area due to a pay increase and maybe a slightly longer commute and/or slightly smaller apartment, or would I make about the same amount of money and be unable to afford something reasonably comparable to the lifestyle I have right now?
I hear a lot of "you have less money, but there are so many free things to do when you're on the coast!" but I don't really know how that translates for me anyway. Our entertainment budget is probably less than $200 a month (on average) so I'm not sure how that offsets paying 3-4x as much per month for rent - does salary help correct the difference?
Here's a living wage calculator complied by MIT. It breaks it down by state and county what an average living wage is along with average rent, utilities, grocery, etc. prices
Really, even the question is kind of privileged, isn't it?
Many people can't even ask whether it would work. They just have to make it so.
Of course. I'm not the OP, but I don't think the question was necessarily "how does anyone live in a HCOL area and survive?". I think it was more "if I were to take my current lifestyle and income to a HCOL area, what would my lifestyle end up looking like?". I think that's a fair question, and a hard one to figure out an answer to.
I fully realize people live on minimum wage even in Manhattan or San Francisco. I'm incredibly lucky that I don't have to live in minimum wage anywhere. But I'm not super excited to give up my nice lifestyle in a MCOL area to move to a HCOL area and have to squeeze every dollar if I don't have to. For me, a better understanding of how that shakes out would be really helpful - would I be able to live a comparable lifestyle in a HCOL area due to a pay increase and maybe a slightly longer commute and/or slightly smaller apartment, or would I make about the same amount of money and be unable to afford something reasonably comparable to the lifestyle I have right now?
I hear a lot of "you have less money, but there are so many free things to do when you're on the coast!" but I don't really know how that translates for me anyway. Our entertainment budget is probably less than $200 a month (on average) so I'm not sure how that offsets paying 3-4x as much per month for rent - does salary help correct the difference?
Of course. I'm not the OP, but I don't think the question was necessarily "how does anyone live in a HCOL area and survive?". I think it was more "if I were to take my current lifestyle and income to a HCOL area, what would my lifestyle end up looking like?". I think that's a fair question, and a hard one to figure out an answer to.
I fully realize people live on minimum wage even in Manhattan or San Francisco. I'm incredibly lucky that I don't have to live in minimum wage anywhere. But I'm not super excited to give up my nice lifestyle in a MCOL area to move to a HCOL area and have to squeeze every dollar if I don't have to. For me, a better understanding of how that shakes out would be really helpful - would I be able to live a comparable lifestyle in a HCOL area due to a pay increase and maybe a slightly longer commute and/or slightly smaller apartment, or would I make about the same amount of money and be unable to afford something reasonably comparable to the lifestyle I have right now?
I hear a lot of "you have less money, but there are so many free things to do when you're on the coast!" but I don't really know how that translates for me anyway. Our entertainment budget is probably less than $200 a month (on average) so I'm not sure how that offsets paying 3-4x as much per month for rent - does salary help correct the difference?
I see the lord is testing me again.
Lol. I'm sorry!
Maybe this stuff is obvious when you already live in a very hcol place. Having never done that, hearing rent averaging in the several thousands per month sounds impossible. I want it to be possible!