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Does It Make Sense for Programmers to Move to the Bay Area? (triplebyte.com)
359 points by runesoerensen on Dec 14, 2016 | hide | past | web | favorite | 503 comments

As someone who grew up in the Bay Area, but moved to Portland about three years ago, I can tell you there is a stark difference in ecosystems. However, if you are a young up-and-coming programmer coming out of school, it makes complete sense to move to the Bay Area. If you're an Actor you move to L.A. to get your big break. If you're a programmer, you go to the Bay Area to work for a big firm that will help build your reputation and resume. For people later in their careers who have "been there/done that" it's less about what you can do for a company and more about what you can do for yourself. People later in their career tend to think more about their quality of life after spending years grinding it out in markets like the Bay Area. I know it's the big reason I moved to Portland. I love the tech community here. It's much more collaborative. The salaries may not match what you get in the Bay Area, but what I lose in salary I gain in not being stressed all the time.

I agree with you, but only people who want to make big buck should move to the Bay Area. As you concluded later, money is not everything. I am young and about to finish school, but I am moving away from the Bay Area and even move to a different country. I do not care about the high salaries here, as I just do not like the lifestyle here. So, I'd say that the Bay Area is for people who do not mind having to work 24/7 (mind work, not physically being in the office 24/7). Mostly, this is people who love tech a lot and want to innovate all the time (start up people).

I for one care more about less stress, less inequality, etc. and decided that the Bay Area is not for me.

My experience doesn't line up with your preconceived notions of the Bay Area at all. I've worked at three different jobs in San Francisco, and all of them were standard 9-5 jobs. I've worked weekends under 5 times. Most of my friends are in the same situation.

Sure if you want to work at an early stage startup, you can grind yourself into a paste. But there are plenty of jobs here where that's not the case.

When he said "mind work", I took it as the constant, 24 hour stress I experienced while living there. Which sometimes is completely unrelated to work.

The insane commutes, the work culture, the high rent / COL, the culture of trying to look as rich/smart/successful as possible, the sue happy people, the fact that there's absolutely nothing else to do other than work, etc really wore down on me.

I lived in the south bay though... admittedly it seemed slightly better in SF. Less money grobbing and more hipsters. But it looks like all that is going out the window very quickly. The south bay culture is spreading like a cancer.

I've lived in the South Bay my whole life and have absolutely no clue what you are talking about. There are subcultures of workaholic stress magnets, but they are easily avoided. I work 40 hour weeks, have non-tech hobbies and weekends are sacred. Your experience may be typical of the crowd you hang with, but not the valley as a whole.

I'm also mystified at the assertion that SF would be better in this respect. The conventional view is that SF is more status seeking and elitist while the South Bay neighborhoods are more laid back, or at least more diverse in their subgroup compositions.

The cost of living is insane, yes, although astronomical tech salaries entirely compensate for you and me. (Sucks for people who work retail though, and schoolteachers, police etc.)

I've lived in San Jose from birth to 19 years old (worked one year at a startup) and I can see where you're coming from, but you must be blind if you have no idea what I'm talking about. The friendships I cultivated while growing up there are sacred, but those friendships would have been impossible if I didn't meet them while growing up. If I moved to SJ from somewhere else at 19+ I know I would be miserable, because like it or not most people are exactly like I described in my original comment. The type of people we grew up with and the type of people who migrate here are VASTLY DIFFERENT. Thankfully you and me could avoid them, since we were "fortunate" enough to grow up in the south bay. I'm thankful for my unique experience, but it's just that: a unique experience.

As far as SF goes, I was talking about 5-6 years ago. I've heard its way worse these days. And it's going to keep getting worse, because the south bay is a cancer. It wasn't until I moved away when I realized that.

I don't know what to say. Get out more, I guess? Change your group of friends? There's a million people that live here and I'm always meeting new people and striking up conversations. Some stick, some don't. I actually don't hang out with anyone from my childhood anymore, as I've made so many new friends over the years.

I'm glad things worked out for you in any case.

> Get out more, I guess?

I don't think I'm getting my point across correctly. Sure. There are niches in the bay area that are great, and I'm sure I'd meet many interesting people there, if I decided to stay.

However, there's a certain point where enough is enough. It's not like this problem I'm describing is just the effect of a one-off bubble that will go away soon. It is going to get worse and worse; like it has always been. Housing prices / COL are going to go up and people are going to be constantly forced out of their homes and have to relocate and compromise. If you fuck up in your career or make one bad move with your finances, you are done. Bye bye bay area. If it doesn't happen to you it will definitely happen to your friends. It's just a horrible existence and I am honestly baffled you don't see this despite living there your whole life. The only way I could conceive of you not seeing this is if you and your friends have something like $2M saved up and don't need to worry about finances.

You are very fortunate then. My experience here in the Bay Area mirrors kLeeIsDead's. I get up at 6AM and come home from work at 7-8PM, and am mentally and physically exhausted daily from the whole rat race + commute. Totally different from other places I've lived where I could have a life. Fortunately I'm currently not subject to a lot of weekend work.

> The insane commutes, the work culture, the high rent / COL, the culture of trying to look as rich/smart/successful as possible, the sue happy people, the fact that there's absolutely nothing else to do other than work, etc really wore down on me.

Oh god, you really quantified the cruft that made me hate the place. The bay is sublime in its beauty but could only be perfect for me if the population was subbed out for Austin's or DC's (which are in many ways opposite, but they're also far more distant from SFBay than they are from each other).

Yeah, same. I live in San Jose and feel 100% like you. I haven't even worked yet and only went to school here and I am already exhausted.

This is why I chose not to live here after graduation.

The crazy part about it is it's just going to get worse and worse. I was born and raised in SJ... since the 80s this tech stuff has been slowly building on top of itself like some sort of tumor, and the city does absolutely nothing to stop the gentrification and overall shittyness of the money-money-money mindset from taking over. I'm 23 now, most of my friends and 100% of my parents friends (lived there since the 60s) have moved out because of the constant influx of migrant workaholics.

It's given me a very cynical view on life. I really don't know where else to move, I feel like I need to leave the country as well, or at least leave California. Where are you going, if you don't mind me asking?

I felt the same way after living in SF for 6 years. I moved up to Portland, though they probably find me to be an annoying migrant too :/

FWIW, it's not the "migrant" part in itself that irritates me. It's the whole thing, "migrant workaholics". I hate the people who moved to my hometown for the sole reason to make money and go back to their home country, with no intention to integrate.

I am moving (back) to Europe (Germany). I have a European Passport, so I don't have to worry about a visa, like I would have to if I decided to stay here.

Ah, interesting. I'm German too. Unfortunately all my ties to Germany have been severed when my Oma died.

Come to Berlin, the startup scene is great by european standards, the city is cheap and super diverse. Great food, great nightlife but cold winters ;)

If you get exhausted by working a lot, it's probably best to not work at a small startup or a company that is growing super fast. There are larger (usually public) companies in the Bay Area where people can work 9-6 type jobs and be great at their jobs. It can be team dependent, but there are people who work totally normal hours at google, apple, linkedin, etc. There are a lot of other mature companies people work at as well. It's not as sexy to say you work for them, but they pay you a respectable salary and don't have to take over your life. That said, ANY job can take over your life if you let it, whether that job is in Portland, Austin, Chicago, or San Francisco (not that it is necessarily a bad thing to have your job be your life).

> the fact that there's absolutely nothing else to do other than work

> I lived in the south bay though

Well, yeah

Over the years I've noticed the south bay culture spreading up to SF and Oakland, and down to Santa Cruz. They haven't been hit as bad as Palo Alto and San Jose, but I'm afraid that the culture will continue to spread as long as the software industry continues to be lucrative (and other industries become less so).

Not everyone has the same experiences with the Bay Area - I live in the Valley and my commute is better than when I lived in DC (where even going < 2 miles to work took longer than it takes for me to go 7 miles by bus currently, even with direct routes in both cases), and I enjoy running/playing board games/hanging out with friends greatly.

For me, it's mostly been great.

Agreed though I'm coming from the opposite perspective. Despite the traffic, I'm willing to put up with it in DC because the caliber of people is entirely different and far superior to any experience I've had in SFBay.

I've carefully cultivated non-tech friends in SF/South/East Bay, to the point where I actually need to meet more tech people now since I have no idea what work life is like at other companies.

It's been worthwhile and we do plenty of stuff, but you have to be prepared to drive very long distances to see anyone. And many people who don't get into tech move away, so practically everyone is younger than me (and male) and can't afford the hipster restaurant visiting hobbies.

Oh, but the commute here is really not that bad compared to other American cities that aren't "world tier" (LA, Atlanta, DC) because those cities refuse to build mass transit.

> DC

I'm assuming you've never paid us a visit :( DC literally has the second largest mass transit system in the country.


Assuming they can keep it from catching on fire or de-railing. I'm happy to be out of NOVA/MD/DC.

I lived in Vienna, VA for a while, so I'm pretty familiar with all the failings of WMATA. And there are many. But...and it's a big "but", if you've lived in any major non-coastal city in the US you might think that DC's Metrorail is at least a public rail system, which is better than many cities have.

It's sad that in the US, you have to take what you can get, and the reasons why the US doesn't have good public transportation have been discussed here ad nauseum, so I won't even flog that dead horse again.

Sure, but when the density gets too high, you require public transportation to get around. I used to live in Falls Church. 20 years ago it only took 20 minutes to drive 5 miles to Tysons Corner (still crazy). Now it takes 45, but you can take the metro.

Sorry, meant the suburbs I guess. Some friends in the military and government definitely complain about how long it takes to drive a short distance.

I've only ridden the Metro once, yeah.

I mean, I'm in the suburbs... Haha

Maybe it is because I live in the South Bay. But here it seems that everyone is just going to work and back home.. and that's it. There is nothing else going on here, but work work work.

It might be your specific location. It also might be a combination of "selection bias" -- people tend to be friends with people who are like them in some way -- and psychological filtering where you just don't see anything else for some reason.

I remember reading a piece about alcoholism where it was describing an alcoholic who concluded that everyone drinks a great deal and just doesn't admit it because that was what their social circle was like. I rarely drink alcohol and have known plenty of people like me, so, no, not everyone drinks.

Most people suffer confirmation bias. We look for confirmation of what we believe to be true about a thing. It is unusual for someone to actively seek more objective data and try to determine what the actual truth is. Most of us default to trying to fit the world to our preconceived notions of it.

I think it comes down to culture.

The culture of the South Bay is relatively non-existent outside of small pockets like Palo Alto, Los Gatos, Mountain view, and maybe Santana Row. It's geared toward raising kids and family life in general.

I am having enormous difficulty parsing that comment. I have tried to just let it go, but I am failing at that, and I am seriously struggling to reply in a way that does not sound like snark.

Could you clarify what you mean? Because it sounds like either you are saying "Culture only exists in tiny parts of certain places, no place else in the South Bay even has a culture" (which is utterly nonsensical) or maybe you are saying "People who have kids and put family life first are not part of any culture." (again, a big fat nope).

I'm guessing what was meant by culture was "cultural life", as in "things to do outside" (think the Arts & Culture section of the newspaper).

I look for that type of thing and seem to find an alright selection. I don't always select, but there's a selection.

A culture of people with no kids doesn't sound like a real culture to me.

I think what he is saying is that the South Bay is completely without culture, unless you count strip malls and chain restaurants.

I thought the same thing of the first place I lived in my early twenties after moving away from my home town. Then my older sister came to visit and schooled me in how blind I was.

Culture is a human artifact and although it exists partly out there in the world we create, a big piece of it lives inside us and informs us of the proper way to interact with both other people and the spaces we share. Sometimes, people who decry the lack of culture of an area are telling you more about themselves than about the area.

Interesting reply, it seems you've misconstrued the intent of my post.

I was merely sharing my observation that certain areas in the South Bay tend to have more stuff to do (i.e. a downtown). Not sure why you took that as me denigrating parents and families. Perhaps I was being vague.

I agree that culture is something, as you put it, that is kept inside of us. However, people don't exist in a vaccum. We are very much influenced by the environment we live in. Most people don't exist in a cultural vacuum where they don't interact with the larger cultural forces in their environment.

My (admittedly anecdotal) experience has been that the South Bay is primarily a work culture. Having lived both in SF and the South Bay, I can tell you that both are offering very different answers for the same question, regardless of whether or not you are single, married, or have kids.

Interesting reply, it seems you've misconstrued the intent of my post.

Yeah, no. Please do not assume that a reply of mine to one of three replies to my actual request for clarification is some kind of commentary on you.

I agree that culture is something, as you put it, that is kept inside of us.

That isn't at all what I said. I said it is a human artifact and part of it is stuff out in the world and part of it is a thing inside us, which is very different from saying it is "only" inside us, which is what your framing strongly suggests you read it to mean. In which case, it is you who are misconstruing my comments.

My (admittedly anecdotal) experience has been that the South Bay is primarily a work culture.

Thank you for clarifying.

"Chain restaurants" Really? I don't even live in the Bay area but I visit a fair bit on business and I don't know the last time I've eaten at a chain either in the city or the South Bay.

But the South Bay is basically suburbia, SJ technically being a "city" notwithstanding. So just like pretty much every other urban area in the US, there's enormously more "culture" (in the Arts, Theater, and Culture section of the newspaper sense) in the city, SF in this case, than in the suburbs.

Boston/Cambridge are exactly the same way. I live well West and like it but if I want to go to see a show or music performance, 95% of the time I'm going to drive into town.

I don't know what exactly you're looking at, because from my perspective "everyone" is an insane exaggeration on your part. I know countless people who run, cycle, ski, mountain bike, play soccer, go backpacking, play board games, travel, partake in live music, and so on and so forth.

Sure there are disproportionately more workaholics in the area. There are also disproportionately fewer people who work 9-5 then go home and veg out on their couch. To me, the lifestyle here is rich and amazing. Where I grew up, which was in an equally large and cosmopolitan city, it's too cold or too hot for 4-6 months of the year to do much outdoors, salaries weren't high enough for people to routinely go to expensive restaurants or travel, and the geography is nowhere near as beautiful or interesting.

Maybe you should look inward more and take charge of your life; it may be that you're hanging around people who focus entirely on work, and so your perception is skewed.

Well, everyone around me pretty much determines what is available to me. No one is going to build a zoo in San Jose if no one is coming. San Jose does not even have something like University Ave in Palo Alto. SJ Downtown is horrible and certainly not a place I'd like to go to have fun. What I am saying is, that compared to other cities such as LA or San Diego, San Jose is dead. Nothing besides working is happening. Considering how much I am paying to live here, that is disappointing.

Santana Row or Lincoln in Willow Glen would be the analog to University Ave. Both are pretty nice to hang out in.

Campbell also has a nice downtown; while it's not San Jose, it's surrounded by San Jose and is basically the same metro and is VTA-accessible. There's also Saratoga and Los Gatos, but those are further out.

Downtown, I'll grant you, though. San Pedro Square can be OK, and the area nearer the University has some quirky stuff, but it has a ways to go. It's gotten somewhat better over the years, though, and I think BART coming to the area may accelerate that a bit since it can actually be a destination.

I totally agree. If people want to gripe about high rent/COL or lack of public transit that is fine and legitimate. But complaining about lack of things to do just doesn't add up. You can go hiking in Marin or in the open space preserves on the peninsula. You can drink great beer at several breweries or go to Napa/Sonoma to wine taste. You can go skiing in Tahoe. You can go to Yosemite or Sequoia. You can ride your bike in the mountains/hills on the peninsula. You can go to several different beaches. There is a good restaurant scene (albeit expensive). There are NBA, NFL, and NHL teams if you are into sports. As someone who moved here from Illinois, I think the variety of things to do in the Bay Area is huge.

But all the places you mentioned are at least 1.5 hours drive from San Jose. You can't expect me to drive 1.5 hours just to not have to sit at home every time I want to have some fun? I love day trips, but I don't want to have to to a day trip every weekend or every day I want to have some fun. Compare that to LA or San Diego where you don't have to drive far to have fun (nightlife for example) or awesome beaches. All I see in San Jose is empty streets after 9pm. There is nothing going on in this town besides work.

Nightlife in the south bay is rather lame.

But here's one thing I've found: People who really want to have fun find a way. There are small pockets all over the bay. SJ downtown is a little lame but it is getting better

We do have hiking trails in the area too, particularly up in the Santa Cruz Mountains, and Henry Coe State Park is a little less than an hour away. There are a number of wineries in Los Gatos and Saratoga, around half an hour away. I'm less familiar with the microbrew scene around here, but I know there's mead in Sunnyvale (~30m) and a handful of larger "micros" like Rock Bottom in Campbell and Lazy Dog in Cupertino. NHL is downtown, NFL is ~30 min away in Santa Clara, etc.

You're overstating the issue. It's not New York or San Francisco, for sure, and we sure do need better rapid transit but you're definitely not an hour and a half from everything cool. You're more like half an hour or so. You just need to look for it.

Sounds like you're simply living in the wrong place. Within 30 minutes, I can drive from SJ to a number of great hiking trails or take my road bike to some super fun hills. Of course the streets are empty after 9pm... people want to be able to get outside when the sun is up!

I guess that could be true. South San Jose seems to be much better.

Going straight from work to home and staying there is indicative of a "work work work" culture? That's some doublespeak. I have lots of hobbies (and kids) at home, and wish I could do more of that.

The South Bay is a residential suburb. It doesn't have much of a nightlife. The same can be said about most of the places people live in this country outside of the densest urban centers.

If that's not what you want, then by all means move. But recognize that this is exactly the sort of stability many people strive hard for.

Try Meetup or joining ridiculous activities like crossfit. I read someone here call them "secular cults" - why do you think people go to church everywhere else?

Whether or not that's true, your lifestyle isn't dictated by what "everyone" does, it's only dictated by what you do. I know lots of people who are workaholics or spend all of their non-work time with their families, and I know as many or more people with rich and varied lifestyles that go out and do stuff with friends all the time. It's what you make of it, like many things in life.

Sadly, what everyone does determines what is available to me. They are not going to create nightlife and other interesting stuff if there is no target demographic.

You need to broaden your horizons. There are tons of things to do in the South Bay.

* Rock climbing * Scuba diving in Monterey * Bicycling on the bay trail * Board gaming clubs * Meetups * Wineries * The boardwalk in Santa Cruz

You can even take an hour train ride straight to SF and spend the day with the snobs and homeless. And then take the same train home to a place that doesn't stink like urine.

> My experience doesn't line up with your preconceived notions of the Bay Area at all

Your phrasing is needlessly incendiary and possibly mistaken, since parent says

>> I am young and about to finish school, but I am moving away from the Bay Area and even move to a different country.

It really depends on what you want to do. If programming is programming and programming is just a job, then you can do that anywhere there are programming jobs, and with so many companies offering remote work, that could be anywhere.

But if programming is what you intend to bring as a founder - if it's simply a means to get the burning ideas out of your head and into a product, then there's a much smaller number of places where that will work: San Francisco, Seattle, New York. You need to be able to have coffee with a VC, meet with multiple co-founder options, do a tech meetup and also spend a sizable chunk of the day coding.

If you live near a small city, working that way is an impossibility. You'd have to go to the nearest big city to find that type of collaboration, and the trip will burn through all your coding time, and you still won't have the kind of quality selection that you'd get in NY or SF.

As you say, hacking the rent-salary ratio, which is what the article is about, should be a much smaller factor in how you decide where to live.

What if I'm working on a side project, don't want VC funding (or any sort of loans), and just want to build organically? I can find people who can program and can program well in almost any place on the planet. There are a shitload of Russians and Chinese cleaning up at things in the software engineering domain. There are a shitload of people writing all kinds of good and bad code everywhere. Even if I wanted to found a startup in Nowhere, Saskatchewan I could, particularly since there are plenty of folks who will work remotely and maybe a few locals who are good as well.

San Francisco is a place. Engineering talent is available everywhere, though perhaps most places it isn't so much fish jumping onto the line as in the Bay Area.

What about all the nerds who are Polish, Portuguese, and Peruvian and choose to remain local because their spouses, children, and other interests are? They can still code, some of them are definitely brilliant, and they can either work locally or (more likely) remotely.

Starting a "startup" with venture capital might be next to impossible in Peru, for all I know, but a hell of a lot of folks don't want to exit, don't want to dilute their ownership of their product, and frankly like the environs elsewhere.

If you can afford to pay a couple Chinese programmers this isn't a bad idea. You run the risk of your code just vanishing and a eerily similar Chinese product appearing a few months later, but depending on your financial situation you can be a sole funder in that case.

Not that I have anything against using out of country programmers, but it's a fact that China does not strongly enforce copyright and does not go out of its way to protect foreign businesses. I don't know about Russia, India, South America, etc, I'd be curious about anybody that's done this sort of thing before. Tim Ferris always talks about it for things like running his support and returns and whatnot.

You can just choose countries with Western culture that didn't have too much luck economy-wise in the recent years, but have stable states and law. That usually means Central/Eastern Europe: Poland, Czech Republic, Hungary, Lithuania, Estonia, Latvia and so on. Avoid Belarus, Ukraine and others with heavy eastern influences (a rule of thumb: if they use Latin alphabet, there's a good chance that it's safe).

I think to padobson's point, it's all about what you want to do.

There are certain restrictions that the Bay Area places on you, like how much money you need to earn, and a particular lifestyle you want to live, in a very specific industry. This is the same as someone going to Houston for Oil, NYC for Finance/Fashion, LA for entertainment, etc. People who live in those places have a particular set of goals - e.g. building big companies (vc or not), doing well on wall street, hitting it big in the movies, etc.

If you don't have those goals, then absolutely - stay where you want to stay. Work remotely. There is a ton of arbitrage in software dev right now, you can make a killing and live in really cheap places. You can literally live like a king. if that is what you want to do.

So it all comes down to your goals, and the Bay Area as a whole is self selecting in that way. If you want to do something more chill in software, that's great. We need more people making money writing code - it's great for the world economy. But you don't need to be in the Bay Area for this (unless you want to).

> you need to be able to have coffee with a VC

If you are building a company that needs VC funding. Most companies don't.

"Venture Capital is the wrong source of capital for the vast majority of entrepreneurial ventures" http://avc.com/2005/03/dont_take_the_m/

If you aren't looking to raise VC but instead want to be part of a vibrant tech ecosystem, well, that opens up more mid tier cities. For starters: San Diego, LA, Boulder, Austin, Portland, Pittsburgh(?) in the USA.

I've been far happier as an engineer in NYC and Berlin than SF. Gentrification has made SF a pretty boring place to be, and I felt that my overall sense of creativity plummeted there when I was surrounded by so few people from different backgrounds.

Agreed. I ended up moving across the bay and living in Berkeley while working in SF just for that reason.

I don't think there's nearly as much gentrification as people say there is, overall. I mean sure, there's a huge amount of gentrification in the 20% of SF that is not rent controlled: there only the super rich can live.

But, as for the other 80% that's rent controlled, lots of it is pretty dilapidated, almost borderline 3rd world country in some parts. 1% (7k people) of the SF population is homeless and even more are nearly there (despite over 240 million$ a year spent fighting homelessness).

Perhaps the reason people find SF boring is due to the hollowing out of the middle class.

It's kinda funny though, as people in Berlin at least (I'm sure in NYC too) are constantly complaining about gentrification too :)

Adding one: if you're doing anything security related, DC's your friend.

Good point!

And if you are into oil/gas, Houston. Marijuana, Colorado or Washington. Cars, Detroit (maybe?). Commodities, Chicago. Ag, Kansas City (maybe?). Outdoor experiences, SLC. Building something for Latin America, Miami. Ets, etc.

I imagine there are many other cities that dominate in niches that I'm missing.

St. Louis tends to be one of the best cities for Ag stuff.

For the ignorant, what's AG? Google isn't helping.

Someone should tell Google (hey googlers on here) to add that case to the search engine's special cases, as in: "Did you mean agriculture or (the chemical symbol for) silver [1] or ..." :)

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


I live in the Detroit suburbs. Can confirm many programmers working for auto companies around here and friends with a few.

>go to Bay Area to a big firm to build your reputation

Doesn't make sense. The big 4 have campuses across the country.

Instead of telling people to move to SV I would recommend making sure to get into the right (big 4 or not) team and role for your career. Just fixing bugs at big SV company will not help much. You want to make sure you have a chance to contribute something to show your skills on an innovative or leading team.

Joining one of the FANGs as your first job is a great way to kill your chances of developing a highly diverse skill set early on. Good luck doing anything interesting when there are 120 superior engineers who are bored out of their minds all vying for the opportunity. Working in a smaller company that has real problems to solve tends to be much more rewarding. There's a reason the technical leadership at the big 4 tends to be comprised of engineers who came from elsewhere.

I have to agree with the OP, I know a few Googlers (my wife used to work there) who transferred from satellite offices (say Venice or NYC) to MTV and all of a sudden their careers took off. Generally, being physically there where the action is (HQ) seems to pay off for ones career.

One time I talked to a Google recruiter, and that was the message he conveyed. "Sure, you can work at a satellite office, but if you are interested in your career, Mountain View is where you want to be."

Two caveats to that:

- I promise you that's only true as far as your project's priority. For example if Google Maps in Colorado is more important to the company, at the moment, than some other project at HQ, then working on that project at HQ is not better for your career.

- Remember a recruiter is a sales person. Some are honest, some will tell you what serves their own interest.

All Google VPs are in MTV, it's not a secret inside Google that it's easier to get promoted there. Still, I'm perfectly happy in working at a satellite office.

Yes, I doubt the MTV recruiter gets commission if they have to hand you off to the satellite office recruiter instead.

> Doesn't make sense. The big 4 have campuses across the country.

Yes, but a disproportionate number of their positions are in the bay area. Also, it's much easier to job hop between high-paying companies in the bay area, and this is particularly true if you have a specialization more specific/less common than "web dev" or "iOS dev".

My first role was in Charlotte - at a startup. It's not everyday that you get to work for a company with fewer that 10 people and less than 10 months old but it happened for me in a market notorious for only having banking mobile dev roles. Ironically, I left the Bay Area to get my first shot because I wasn't young enough for cultural fit most places (apparently). Now, I'm in Chicago and while the weather is shit, there is a lot of energy here and the scene appears to be lifting off. You don't need to build a reputation in SF (or Oakland, et al).

I think that whole ridiculous "cultural fit" nonsense is why I ignore jobs in the BA. What on earth do I care if my team listens to the same music that I do? or wants to eat the same food I do? Culture is best when it's infused with all kinds of outside sources. Having this homogeneous hive-mind isn't really good for any business. But trying to explain that to your average 20-something is typically not that easy.

>Just fixing bugs at big SV company

They're called "incidents" at some (enterprise software) bigcos, BTW :) - and tend to be called "defects" in software services companies using software engineering standards like ISO 9000 or SEI CMM.

Juniors or freshers tend to get assigned those for a while. Nothing wrong per se, it helps them learn the codebase, and in some bigcos, the codebases can be pretty big. The same practice is followed in some smallcos too.

I live in the BA and work in tech, and I'm not super-stressed. Neither my peers seem to be. It doesn't mean we don't work - but not more stressfully than I'd expect to work anywhere else. Maybe I'm just lucky.

The downside is everything is so expensive. Housing, of course. But also everything else too, services, other things. If you can live frugally, it may be to your benefit - you get higher income and keep low spending, win. But if you can't or work lower income job, it may be a problem.

The upside is there are a lot of exciting opportunities around, both in employment and in conferences, lectures, events, etc.

Totally. The nice thing about being in Portland is that the Bay Area is only an hour and a half flight. We still have family down there so we spend some time there, but we have kids. So one big reason we left the Bay Area was just to find better quality education and we definitely do not regret the move after finding amazing schools here.

But to your point, there are some great events and conferences which is probably the biggest thing missing from Portland. There are a few good events, but nothing at the scale of what happens in SF.

Somewhat off topic.

I thought Portland's, and Oregon's schools in general, are not that good. Unless you are talking about private schools.

I love Portland. I might make more in SF, but I'm already making more than the median SF salary while living in Portland, and my house only cost me $350K or so. The cost of living is starkly lower here, and the city itself is much, much smaller and less hectic -- while still being big enough to have all the things you want and plenty of people if you want to be social. I can't see moving to SF unless I could earn $300K+, and even then it might not be enough to make me jump.

I really want to like Portland because it is so cheap and seems to have good access to outdoor activities. Unfortunately I can't get past the weather, and the stark lack of diversity.

The weather is cloudy/rainy/misty many months of the year - is that right? only heard of it briefly from someone.

As someone who grew up in Portland and still lives here. Please stop telling people about Portland. The traffic is already bad enough and I personally enjoy dreaming of owning a house one day that isn't in the sticks. Portland housing is sky-rocketing because of techies leaving the bay for cheaper housing.

It only makes sense to move there, if you have an incredible job offer on the table. Don't assume you might get one by moving there. If you have no access to some network there already, you much more likely will get access to some kind via amazing work and communication online, than by hanging out in a coffee shop in the Bay Area, burning money for rent and eating Ramen noodles.

Curious about how huge the difference in costs and life-quality might be? Play with https://teleport.org

It's always expensive to chase the hot thing. If you're an average joe, SFO is that thing that is best avoided.

I'm living in a median cost market in an expensive state and live like a king in comparison to someone in my job (senior tech role) in SFO, although my salary is 50% less. I won't be working for Google anytime soon, but I don't need $500k to live in the lifestyle that I want for my family.

If you want the northern CA lifestyle, wait for the real estate cycle to bust and save some money in a normal place.

Having grown up in Portland and worked with and for Bay Area companies my whole career, I'd say that I agree with the premise that for younger tech people it could be beneficial to move there- but not because of the money. Because of the size of the community and more diverse opportunities.

I thought PDX was a vibrant (albeit small) tech scene until I moved to Seattle. It was amazing how many more opportunities to meet and learn from interesting people there were across all tech stacks. Having enough friends down in the SF area I get the impression that their scene is even more lively.

As for bigger salaries, I think it's mostly hype. My anecdotal evidence makes me believe that there's likely more opportunities for early stage equity/stock type agreements than you'd find in other places, but my salary has always compared favorably to people in the exact same role living down in the bay- and that's before factoring in the cost of living.

I considered moving to Portland, until I read about how a big earthquake would pretty much completely wipe it out:


Might as well live in Washington at that point. No state income tax, while there is Oregon state income tax. Then again, Washington has sales tax, whereas Oregon does not. I used to live in Portland, and some peopled lived / worked in Vancouver, Washington, and drove to Portland to do all their shopping, groceries included.

It's really cold and wet all the time. Non-compete agreements are valid so prepare to be screwed over if you change jobs. You don't have the California code on your side if you want to do a side project-- it will be owned by your employer. Amazon will work you like a rented mule and that bald guy in charge is creepy as fuck. Traffic in Seattle is worse than the Bay Area (yes really). They can't expand I-95 because they made the decision to tunnel it through a building (long story)

I've actually worked at Amazon in the past. My experience wasn't that bad. And I'm a actually a Seattle native! For some reason, the traffic there never really bothered me.

> They can't expand I-95 because they made the decision to tunnel it through a building (long story)

Expanding highways makes traffic worse.

Expanding highways makes traffic acceptable for more people (no change or slight dip in latency, but more throughput) which increases housing supply.

No income tax + legal weed everywhere + alcohol in grocery stores + liberal gun laws + you can pump your own damn gas.

Seattle would also get hit hard in the same big earthquake. See the same article above.

Funny thing. I remember reading about this a while back. There were particular regions in Seattle that would be unaffected. I'm not sure how accurately the predicted boundaries were, but I remember my apartment being 10 feet away from the boundary, in the unaffected area. My company, though, was on the other side. In essence, I was exempt from danger for half of the day during weekdays, and a full day during weekends.

I wouldn't worry tooo much about earthquakes in any country with good local building codes. Background: I am from Christchurch New Zealand; my parents live on top of the 2010 Canterbury earthquake, and my sister lives on top of the 2016 Kaikoura earthquake.

Avoid living or working in brick buildings (they fall apart).

If worried, perhaps avoid high tsunami risk zones (that lack high ground, roads are less useful since they will be unusable during large earthquakes).

If you catalog your risks, earthquake death or disability is probably low in scheme of things.

From my experience, if you work in software with a laptop, earthquakes are not likely to affect your work too much.

Unless you have a neurotic partner, in which case avoid earthquake zones, because they lose the plot when the earth takes control.

Yep, I live in the city with the most powerful recorded earthquake (9.5) and not worried.

You realize the Bay Area is likely to be devastated by a large earthquake too right?

Meh. I was in the Bay Area during the 89' quake. I'm not terribly worried about what would happen here. I remember hearing "the big one" was coming for the past 30 years.

If the super volcano explodes do you really want to be alive after?

I moved from the UK, with my wife and two young kids, to the Bay Area in 2012. I'm an experienced dev; mostly hands-on architecture/development, but also leading teams.

Spending time there and experiencing the people and general fast approach to development has definitely help me and my career. It is, mostly, different to the more conservative approach typical used elsewhere. So experiencing the two and being able to use both, when appropriate, is helpful.

After two years we moved back to the UK.

Living and working there was amazing. But, overall it felt like it came at a too huge a cost (financially, work commitment, and commuting).

PS: I do miss being there though. :)

I think there are a number of cities you could get that kind of great experience in though -- Seattle, Boston, New York, Austin, probably others.

if you have that gnawing feeling of "needing to get out" then fuck yeah go to the west coast.

but remember, it's all sorts of a fucked up and competitive out here so be prepared to work your ass off. don't move out here to just make friends.

try it out at. you will miss your friends and your family.

It looks like the salary differential of $33k listed in the article is gross earnings. After taxes this would just barely cover the rent differential of $1.5k/mo ($18k/year). Note that this is the best case scenario according to their estimates.

What troubles me is the use of median rent to compare housing costs. As rent increases, renters are likely to downsize offsetting some of the rent increase. I'd be willing to bet Seattle renters are able to get more space for the area's median rental. Accordingly, the salary increase probably doesn't cover the rent increase for a similar sized home.

A peculiarity of "median" is neither my income nor lifestyle are median. I'm currently thousands of miles from SV and earn and live at the 90th to 95th percentile depending on who's fuzzy math and crazy definitions you trust. So its interesting to know median expenses for something like coffee or restaurant food, but I'd never live in a median real estate so whats the standard of living like at the 95th percentile assuming I'd get a raise? Its pretty good for me and my family where I live...

Median would be relevant if you were talking about moving to CA to sell car insurance to tech people.


I incorrectly multiplied the tax rate to the salary difference, and said that this was a 5$ difference. This is totally wrong (as multiple people point out below). I'll leave my original embarrassing comment as a cation to not write stupid things :)


I just added in a mention of the tax difference. But the numbers are 13.3% in CA vs 0% in WA. That's significant, for sure. But 13% tax on $33k is about $5k. I don't think that changes the conclusion that the salary difference does (in many cases) cover the housing costs.

You're likely correct about the price for a similarly sized home. People who want large homes should probably not move to the Bay Area.

Where are you getting 13.3%? Most likely a software developer is going to be in the 9.3% bracket. And it is also a graduated bracket system so you are only paying that 9.3% on income over $51K.

See https://smartasset.com/taxes/california-tax-calculator

On a $150K income you are going to be paying an effective rate for CA around 7%.

You're omitting MediCal. It ends up being about 13% (marginal) after it is added.

13.3% is the marginal tax for people making over $1 million/year in CA. People in that income bracket are not worrying about whether they should move to the Bay Area.

Are you referring to CA OASDI/EE?

Not sure what MediCal is. You mean Medicare? That's federal.

CA OASDI/EE is 0.9% but you only pay it on the first $100K or so.

Thanks for adding the note on the tax difference! That doesn't address my point though.

If the salary difference of $33k is the difference between gross salary, that $33k is going to be taxed at the marginal tax rate. My guess at a marginal tax rate would be ~40%. Accordingly, that $33k becomes closer to $20k after tax.

Edit: to clarify, consider a Seattle salary of $100k and a Bay Area salary of $133k. The take-home salary for each location would be:

  Seattle : $100k*(1-0.4) = $60k 
  Bay Area: $130k*(1-0.4) = $78k
Leaving $19.8k in additional income to cover the median rent increase of $18k annually.

Washington state has no state income tax, which in California is a little under 10%: https://www.tax-brackets.org/californiataxtable

Works out to $9k according to this for a single filer: https://smartasset.com/taxes/california-tax-calculator#8TRRj... -- so your additional income is more like $11k, or just under $1k / mo. In my experience, the difference in housing is far more than $1k/mo, so you come out ahead in Seattle.

EDIT: Looks like I forgot about California's other taxes on payroll, so it's actually even more in Seattle's favor.

> My guess at a marginal tax rate would be ~40%.

Sounds high for Seattle.

There are take-home salary calculators online (know about the variations by state) if you want to get that "into it."

One nitpick: the 13.3% bracket only applies to taxable income of >$1M/year. The marginal rate that actually applies to most of the numbers being thrown around is 9.3%, which corresponds to the 51-263K bracket if filing a single return (103-526K if married filing jointly or HOH) - plus you can deduct these taxes on your federal return, to boot.


If you move to CA, you need to pay state tax on your entire earnings, not just your raise. 13.3% of 140k is more than 18k, which is certainly significant.

You're totally correct and I am wrong :)

I believe you can deduct state from federal tax, which would save ~2.5% in marginal tax. In addition, social security phases out at ~120k so that's another 7.5% savings. So the difference is almost a wash if I understand correctly?

Don't forget about AMT. That usually throws a wrench in things.


Correct. Specifically, it disallows deduction of state/local taxes from your federal taxable income.

Wait -- is the assertion here that California state tax rates aren't marginal? Because I don't think that's true.

The difference is that WA doesn't have state income tax.

CA taxes are marginal. My math was overly simplistic, because I only wanted to illustrate that you needed to pay CA taxes on your full salary.

Ha, getting taxes wrong isn't stupid. It's a sign that taxes are complicated. :)

Taxes can be complicated but tax brackets aren't a complicated concept. Especially for programmers. Not understanding and planning around taxes is extremely unwise and inefficient. If you understand taxes and finances you can cut another 10-20 years off your working life.

You should write a primer. A lot of programmers get into the game pretty young and figure they'll deal with all of the financial planning stuff when they're older.

For clarity, I wrote up my thoughts here [0]. The issue I pointed out applies to Federal as well as State taxes. By my calculations, it looks like it's clearly not worth it to move to the Bay Area.

[0] http://blog.harterrt.com/is-moving-to-the-bay-area-worth-it....

Downsizing is a plus, not something to be baked into estimates. If down sizing to having roommates in the Bay Area, then the only fair comparison is the same roommate situation elsewhere.

The idea is to normalize salaries by cost of living. If you have more specific information for each area (you have actual offers), then you can use that. However, using a lower rent for the Bay Area, for example, because you'll have roommate, may set you up to take an equivalently lower salary.

For example, if you're going from $100k/$2000 location to $100k/$3000 (salary / rent), but you set it back to $2000 because that's your rent with roommates, you've foolishly/ignorantly accepted a lower equivalent salary.

How would a renter effectively downsize if the entire market is increasing? Is this the typical reaction from those who can afford it?

A renter can get get roommates or landlords can subdivide properties further. Renters may also consider increasing their commute time.

2bdrm to 1brm, 1bdrm to studio, studio to van.

van to nap-pod

Compromise on neighbourhood. If you're in SF instead of living in the nice areas, go to Tenderloin, Hunter's Point, etc. You can find great deals in those areas.

Best is to move there in an RV :)

Where do you imagine you're going to park it? It's 2 hour parking in resdidential areas unless you have a resident permit (not that there'd be any available), no overnight parking in commercial areas.

A paid parking space will run you the price of a 1-bedroom in a sane region.

Then use an autonomous RV. As long as it keeps moving around, you don't have to pay for parking :)

Some Walmart stores allow RV parking -- not sure if there is a limit, or what the quality-of-life is like.

Mountain View's Walmart does not, according to this: http://www.walmartlocator.com/no-park-walmarts-in-california...

i don't know the Bay area, but can you maybe get a job at a company that has some parking spaces?

People have lived in an RV in Google's parking lot. Being on the campus all the time, they could save almost all of their salary.

Interesting that Bay Area hackers make more than local hackers when they relocate outside the Bay Area.


  A 2015 report by Hired found that when engineers from 
  the Bay Area relocate to other areas, they out-earn
  engineers on the local market. Experience in the Bay 
  Area seems to advance careers. Engineers moving from 
  San Francisco to Seattle make an average of $9,000 
  more than others who get offers in Seattle. This Bay 
  Area premium is even higher in other cities: $16,000 
  in Boston, $17,000 in Chicago, and $19,000 in San Diego.
[found slide at http://get.hired.com/rs/348-IPO-044/images/Hired-State-of-Sa...]

Bay Area hackers are more valued in different markets than local hackers. I would love to see the raw data for the "relocating" hackers and local hackers. Is it a question of applied experience opportunities in the Bay Area hackers? Is just startup afterglow? Are relocating hackers better than average pre-Bay Area experience to begin with and this shows up when they migrate away from the Bay Area?

This could also be an artifact of the metric. I call this the "Geico" fallacy.

Geico advertises that "People who switch to Geico save 15% or more". Notice that people who would lose money by switching to Geico should rarely switch. Accordingly, this metric will usually be positive.

Consider that people moving to a new city for a job may need more incentive to move.

I've always found those advertisements weird. If consumers are rational and have good information, then the average savings from switching is the same as "how much do you have to pay someone to switch to Geico?". The higher it is, the worse you should expect service to be!

Consumers don't have good information; applying for car insurance is a big pain, so they usually don't know. They probably apply once, then have the same car insurance for years... which might mean that they are paying too much.

Same basic problem as an employee who has worked at the same company for 10 years, and gotten their 3% raise every year - the market may have changed radically, but looking is a burden (emotionally, and otherwise) so they are unaware of that.

Enter a tremendous flood of car insurance advertising... to get people to actually evaluate if they are paying too much.

Most insurers actually increase premiums over time regardless of whether you make any claims. In the past they offered longtime customer loyalty discounts but as some point some bean counters looked into consumer psychology and noticed exactly what you're talking about so now it's up every year.

All the more reason that they separate from the fair market price!

In practice it's quite difficult to compare insurers in this way since it's not that often you need to make a claim and online reviews are overwhelmingly biased toward negative reviews so they're all like one-star. As far as I can tell the correlation between price and service is not that strong.

For what it's worth, when I had to make claims with Geico it was fine. But I was clearly not at fault in either case so it was not a difficult process.

I also think part of their ability to offer lower premiums is generally having lower human involvement -- no independent agents, claims routed through Web site or call centers, claims adjuster on site in body shop instead of visiting you, etc.

Exactly! "Customers pay us more than our competition. They clearly love us and we're doing something right" is a nuanced point hard to make in an ad, but it needs to be made somehow. That's probably why Statefarm et al focus on their customer service in their ads, but those ads don't sound so catchy.

According to Consumer Reports the last I checked, State Farm is near the bottom of the pack in customer satisfaction among claimants.

Oh interesting. I guess that's the benefit of not competing on price. People assume you're probably good at something if you aren't the cheapest.

I like the term you've coined, but their claim is actually significantly weaker.

"Fifteen minutes could save you 15 percent or more on car insurance."


This is really insightful. Does this fallacy have an well known name?

I think it’s attrition bias, a form of selection bias.


Not that I know of... the closest might be the Broken Window Fallacy (http://www.investopedia.com/ask/answers/08/broken-window-fal...), where only the effect of "seen" outcomes are front of mind and considered, but "unseen" outcomes are ignored even if they are more impactful to reality.

Sampling bias, I think


While I agree with the others calling this a type of sampling bias, I've seen this type of error frequently enough that I think it deserves a more specific name.

It could be as simple as Bay Area hackers being accustomed to higher salaries and negotiating higher (or not accepting lower offers) even in places with cheaper living expenses.

There is that, and the fact that in the eyes of prospective employers Bay Area experience is highly valued.

Honestly I don't think experience in Bay Area is necessarily better, there are great teams in Europe/rest of US and shitty teams in SV, but for some reason there is this Bay Area "halo".

Source: I've relocated to Europe after 3 years in Silicon Valley.

Maybe European companies see a Bay Area "halo," but I wouldn't say the same about American companies.

My company has software developers in Los Angeles, Boston, Dallas, and Sunnyvale. From what I've seen it's a lot easier to bullshit your way into a senior software role in the Bay Area than it is elsewhere, so the rest of us tend to be a bit wary of the ones we don't yet know well.

It's easy to get a senior role at a random company in SV. There are many companies looking for senior people, provably more than there are candidates. However you have to check if they stick, and what they do. It's actually fairly easy to weed out the bad ones with a 45 minute interview if you don't let yourself be seduced by their ability to talk well. In my entire career I have only once heard of someone who seemed senior doing really well at coding exercises and then turning out to be horrible. I have frequently heard of people not coding as awesome as you expected but talking a good line and then being disappointed after the hire.

It's BS but the most effective negotiation tactic in salaries is "I make $X now so I want to make at least $X+Y."

Perhaps developers in the Bay Area learn very quickly how much demand there is for their skills and that confidence translates directly to leverage during negotiations, regardless of where they look for a job. There's too many confounding factors to clearly pick out which are significant without much more precise data.

On a side note: Calling them hackers when you clearly mean run of the mill corporate programmers seems like something straight out of an HBO show.

Oh, I default to using the hacker label as a compliment to programmers here on news.yc. I tend to assume (based on reading bits of code from various news.yc contributors) that many devs (carefully not bucketing myself in this group) here exhibit a level of mastery above a run of the mill corporate programmer.

I can offer only anecdotal evidence; take it for what it's worth (not much, I know).

I lived and worked in the Bay Area for a little over fifteen years, almost two thirds of it at Apple, and almost a third of it at a successful startup called Reactivity.

I left in 2006 because of some catastrophic health events, and have lived and worked in Arkansas since recovering my ability to work.

When I'm working, I find it pretty easy to command higher-than-average pay for this area. Of course, I fairly often work remotely for people still in the Bay Area, or in Boston or Denver, and naturally they're going to tend to offer me more than Arkansas companies would. But I can also command a pretty good premium in Arkansas.

I don't know how much you can take from my example. I'm an old-fart developer now, with a long resume that has a bunch of famous names on it. People who are impressed by those things will naturally tend to offer more money to get them. I've seen some employers in this area become visibly more enthusiastic because of some of the people I've known and worked with, or that I can offer as references. My assessment is that some of that enthusiasm has been respect by association.

On the other hand, there may be some real quality differences in engineering culture, and some fraction of the premium may reflect that. Some of the markets I've worked in outside Silicon Valley have significantly different standards and practices, and the differences are not often for the better. In some cases they've verged on infuriating or clown-car laughable. Maybe some fraction of the premium is employers paying for people they expect to know better, and maybe they're not entirely wrong.

A lot of employers look at previous salary to determine a base point for a new job. Coming from somewhere with a high salary makes it much easier to "justify" asking for more.

How would they know your previous salary?

they ask, and some people stupidly answer.

It's not a big mystery. They ask for higher salaries, because that's what they are used to and end up getting paid more. It's not because their skills are more valued.

When people compare salaries / the cost of living in different cities, they often fail to account for the fact that many people don't spend their entire salary in the local economy. If you are trying to save money (or pay for college, donate to a cause, or buy a Ferrari) this costs the same no matter where you live. You should only apply the cost of living adjustment to housing (and maybe food). When you do this, living in the Bay Area starts to make more financial sense.

We lived in the Bay Area for 3 years. Prior to that, I agreed with you. Living there changed my mind.

More of our salary went to the local economy than I expected. We have a bunch of kids, which amplified the effect, but I am astonished at how much money it took to not feel like we were struggling to stay above water. Babysitting, gas, food, clothing, activities were all extremely expensive. Even insurance was high.

The things that didn't go to the local economy still cost more — because taxes. We bought a car from Minnesota and paid a huge amount of excise tax to the state of California. Almost everything we ordered from out of state was subject to high local sales taxes. Income tax didn't help either — our higher salary put us in a higher tax bracket. The top $50k of salary only netted us $25k in buying power, which was eaten up by rent.

There's a stage-of-life effect. Bay Area is great for young people, where cost of living is a much lower proportion of income. All the excess goes straight into savings or discretionary consumer goods, where a Bay Area dollar is worth just as much as a Rust Belt dollar. It's much less great for a family, where you have additional food, housing, childcare, and health costs that rise along with cost of living.

I don't think that's entirely true. Housing and food are still the highest spending categories. Most of the excess goes to taxes, I think. Families just make it more obvious that's happening.

> Housing and food are still the highest spending categories.

They can be your highest spending categories and still leave plenty of room left over to save.

As a young person living in NYC (high taxes, high housing, high food costs) I can still save a huge percentage of my income due to the high salaries.

NYC is much more reasonable than the SF Bay. Manhatten itself is incredibly expensive, but it's fairly easy to live frugally in the NYC area. There's basically nowhere to go "in the bay area" to save much money.

You're not wrong about NYC, but the bay area is really broken.

In my case, I was renting in Manhattan. When I've considered moving to SF I found plenty of comparable apartments for around $2.5k/m.

Childcare exceeds all other household expenses (incl housing) in a huge % of families. Wish I had stats to cite, none avlbl atm.

Oh yes. That wasn't a factor for us (stay at home parenting!) but school expense would have been if we'd tried to get our kids good schooling.

Staying at home to parent means a missing income. I would include that as a cost.

Yes, this is absolutely true. Your car, clothing, computers and gadgets, and most of your groceries will be a lower percentage of your discretionary income in the Bay Area than in most other places. Your housing and gasoline will cost more, and maybe your car insurance.

However, the caveat is that housing is so expensive here that it's difficult to save up for a down payment on any kind of housing on a single engineer's salary. A 20% down payment on pretty much anything is more than $100k, and even a highly paid engineer will need a long time to save up that kind of money while also paying high rent. An 80/10/10 mortgage or some kind of mortgage with PMI is easier to achieve, but those have significant drawbacks.

So, if you have significant cash savings, or a home somewhere else you can sell, you can achieve home ownership in the Bay Area (but it will probably be a smaller home than the one you have now). If you don't aspire to home ownership, you'll be fine too -- a software engineer with an average salary can afford to pay rent here, and people who say otherwise are simply incorrect. But if you are just starting your career and move to the Bay Area planning to buy a home anytime soon, you're going to be disappointed.

Given that many people predicate their quality of life on home ownership, that's a pretty big caveat.

It takes about 2 years to save up $100K on a typical Bay Area engineer's salary, if you're fiscally prudent. Figure that $150K/year after taxes is about $110K/year, and live on $60K/year. That's eminently doable even in the Bay Area.

The problem is that $100K is a very low estimate for a down payment in the Bay Area these days. Most people I know are getting parental help to put down $500K down, because with housing prices running around $1.2M, that's what's necessary to get under the $700K jumbo mortgage threshold.

> It takes about 2 years to save up $100K on a typical Bay Area engineer's salary, if you're fiscally prudent.

I'm not sure what you think an average salary is. If you think an average engineer can save $50k cash per year out of his/her net income, you're way above the average I had in mind.

Let's assume an average salary of $120k per year gross. That's about $6k per month net for a single person who takes the standard deduction, assuming no 401k contributions. That's a net income of $72k per year. If that engineer saves $50k, that leaves only $12k for everything else. Saving $100k in two years on that salary, which I think is pretty close to the average, is just not doable.

EDIT: Should have been $22k left over, not $12k. Still not enough to live on considering the cost of rent.

When talking about saving, if you're working somewhere established, you also need to take into account bonuses and RSUs or whatever longer-term retention plans are in place. The size of these boggled my mind coming from the middle of the country as much as the base salary numbers. You should never plan on living off of them, but if you can toss 15k or more (and I've seen much more than that) into your savings just from non-base-salary comp, you're pretty nicely ahead of the game.

Whether or not the established places will toss so much money around if the hiring competition from startups dries up if there's a crunch there, well, that's probably a legitimate question, but I'm not sure that job losses of that size would only hit the Bay Area.

Yes it's expensive, but also yes there really are quite a lot of jobs that pay more than well enough to make up for it.

> assuming no 401k contributions.

Why? Fully contributing to a 401k (assuming no company match) would put your "take home" at ~$79,200 instead of $72k following your tax rate (which I assume is roughly correct).

> That's a net income of $72k per year. If that engineer saves $50k, that leaves only $12k for everything else

$72k - $50k = $22k, not $12k.

So with no 401k, you'd have to live on $22k to save $50k/year. When contributing to a 401k, you'd have $29k to live on, which sounds pretty do-able. Add in the fact that you would probably invest these savings, and you can hit $100k after 2 years by saving a bit under $50k each year.

Saving $100k in 2 years is not as outlandish as you make it seem.

How exactly do you figure increasing your take-home pay by contributing to a 401k? Did you forget to subtract the money that's actually going to the 401k instead of your pocket? Even at 90% tax rate, all you are doing is sparing that 90% on the money you are contributing. In other words, you are only actually paying $10 for every $100 you put in, because that other $90 would have gone to the tax man anyway. But you are still losing $10 of your take-home pay.

> How exactly do you figure increasing your take-home pay by contributing to a 401k?

I guess it depends what you mean by "take-home". The original premise was "saving 100k in 2 years". I hope we can agree that saving money in a 401k is saving money, regardless of whether we agree it's "take-home".

I assumed we were talking about money for a home down payment, which would not normally go into a 401k. Getting it out would require a 401k loan, and a 401k loan for a six-figure amount is almost always a terrible idea. The only other way to get it out would be to take an unqualified distribution and get hit with a significant fine.

Most 401k loans become due in full if you leave your job. That traps you in your job until you pay it back, because if you had enough cash to pay the loan outright, you would not have needed the loan in the first place. Unless you have an unusually good severance agreement with your employer that would enable you to pay back the loan if you leave your job or get fired, taking out a 401k loan is a bad idea.

401k loans are limited to $50k.

Take-home is typically understood as the amount written on the check. As in, that's the amount you take home with you when you cash the check.

> $72k - $50k = $22k, not $12k.


But that's still less than most people's annual rent, so it's still not enough to live on. It doesn't change my argument.

The article showed a BLS median salary of about $150K/year for San Jose, and TripleByte's data had it at about $140K/year for SF.

I disagree that $22K net is not enough to live on. It is if you go the multiple roommate/1+ hour commute (i.e. East Bay)/never go out lifestyle. It's not a ton of fun, but it's doable.

After maxing out 401k you get about $10k net a month @ $200k. Not including bonus and stock. $10k a month is a lot anywhere unless you have kids.

Sorry, I live here. I have an average salary for my experience. I can barely save $20k/yr.

My rent+util is about $2000/month. I live in a very /cheap/ 1-bedroom with creaky carpet floors, no insulation, and near train tracks that's far outside SF. (Belmont)

Altogether I spend close to $4000/month if I don't do anything special. /Everything/ is more expensive in this region. Food is expensive for no apparent reason other than to gouge customers. ($6 for a few sticks of butter? When I was in Seattle, it was $2-3.) I eat less fruits here because the prices are high year round. My job doesn't provide lunches, so I have to eat out everyday I'm at work. I mean, even cars cost more here just on Craigslist. In the same way there's an Apple tax, there's definitely a Bay Area tax.

I cannot possibly save $50k/yr for a house. Oh and $150k/yr is not $110k/yr after taxes. It's more like $94k.

I'm saving maybe $20k/yr right now. Ain't even contributing to retirement. Just trying to save for who knows what until I can get a job that pays 50% more.

Cook your own food, shop at cheaper places. Big fan of http://www.imperfectproduce.com/

You don't have to spend $6/lb of butter, but if you buy it at Whole Foods (or similar), you do.

I'm quoting Safeway prices...

Huh. We just moved out of a 2/1 in Belmont, 1 block off El Camino next to the Safeway, where we were paying $2050. Sure, once you add utils in it's more, but not a lot more. Splitting the rent with my wife, my share was basically what I was paying in rent for a 'fancy' apartment I shared with a roommate in Santa Clara 10 years ago.

Granted, the house was a good deal, but should be able to swing a 2/1 for 2500 or so.

It's cheaper to live in a larger place with roommates. You pay a premium for single bedroom and living by yourself. I lived in a warehouse with 5 other people for a while to save money.

From a certain point in life living at your own place (no matter if rented or not) with no room-mates is non-negotiable, given the financial means to do so. I'd rather live in a studio apartment at the edge of the city (been there, done that) rather than sharing a villa in a beautiful neighborhood with 5 other strangers. If it matters I'm in my mid-30s now, but started feeling that way immediately after I broke up with my wife 5 years ago.

> Altogether I spend close to $4000/month if I don't do anything special.

That's including rent right? If so that's not too bad.

> Food is expensive for no apparent reason other than to gouge customers.

Stop shopping at overpriced pseudoscience stores (eg Whole Foods). Regular grocery stores are not that expensive. Or buy in bulk at Costco.

> My job doesn't provide lunches, so I have to eat out everyday I'm at work.

Bring food from home and stop wasting money on buying lunch.

>Food is expensive for no apparent reason other than to gouge customers.

You're not the only one paying extra rent to rentiers. So are retailers and restaurants.

You don't have an average salary for your experience.

$4,000 * 12 is $48,000. Plus your $20k in purported savings is only $68k.

That's only $100k in gross pay, which is the bare minimum for a developer in SV. Most new grads make more than that.

According to PayScale[1] and Glassdoor[2], average/median salary for software engineer in the Bay Area is around $110K, so it's tough to believe $100K is "the bare minimum".

1: http://www.payscale.com/research/US/Job=Software_Engineer/Sa...

2: https://www.glassdoor.com/Salaries/san-francisco-software-en...

That's salary alone, not total comp.

Your post only mentioned salary.

EDIT: And to add more to the conversation than that curt response:

When I compare take-home pay among various jobs I tend to ignore bonuses (because they're subject to your employer's whim--you don't necessarily get them) and I tend to ignore equity (because it's typically temporary--once you vest it no longer adds to your yearly take-home). To compare apples with apples you can only really compare base salary.

That is nuts to only compare base salary. At the big 4, base salary will be <60% of total comp. It's possible that Goog will hit really tough times and no longer pay the annual bonuses and it's possible they don't offer equity refreshes. But it's much more likely that Goog's business will hold steady (or grow) and the company will want to continue attracting candidates. It's much more likely that employees get refreshes so that their pay in years 2,3 and 4 are higher than the pay they were promised at sign-on. However, it's possible for pay in the 5th year to drop if the initial grant is huge.

I think it makes sense to discount those factors, but ignoring them entirely is disingenuous.

A company offering $100k in salary + $20k in bonuses and $80k in RSUs is paying significantly more than one offering $120k in salary with no bonus or RSUs.

Also, Glassdoor tends to skew low. Here's a more reasonable database of new grad offers which average $109k base for public tech companies. [0]

[0] http://newgradsalaries.com/

Like I said, $4000 on a regular month. I spend more many months because of trips, stuff breaks, etc.

Most new grads here make $90k-110k from what I've seen. Yes, you can make more. Yes, there are companies that pay stock on top of that. Those people are not me.

I make ~$110k. Minimal benefits. No stock. I happen to work for a big company too. Not every company here pays well and many low ball as hard as they can. (And succeed at low balling)

Before this job, I made $65k. Companies low ball hard and if you can't interview well, you take what you can get.

You claimed that you make an average salary for your experience, now you're admitting to being lowballed. Which is it?

If you're not a new grad and you're only making $110k, then yes you are making under-market. I'm not disputing what you make (that'd be ridiculous), but your assertion that you're making a standard salary.

Uhm, Belmont isn't exactly a ghetto.

> It takes about 2 years to save up $100K on a typical Bay Area engineer's salary

Have you actually done this? Know anyone who has? This seems completely implausible, outside of some extreme frugal lifestyle cases (I'm talking "eating garbage dumped by grocery stores" level frugal)...

I actually saved up $100K in about 18 months, working at a large Bay Area tech company and living in Mountain View. I don't feel I made significant compromises to do so, either: I had roommates for 6 of those 18 months but lived in a 1BR afterwards, I had friends (many of whom I still keep up with), I owned a car and got out on weekends. I did cook the majority of my (non-employer-provided) meals at home, and my friends tended to like relatively cheap activities like LAN parties, board games, and hiking rather than expensive meals out. I didn't go on any major vacations, but my family lives back East, and so that includes rather expensive airfare at Christmas, Thanksgiving, and 4th of July to see them.

Paycheck calculator shows me that $120K [1] in CA leaves you with $6,220 after-tax monthly income. If you really made about as much, and managed to save ~$5.5K a month, then you spent only ~$660 a month, which is just impossible, sorry. Even if you're sharing a 1BR with several roommates, which, by the way, is not really an option for many.

[1] Googling "average software engineer salary california" shows figures ranging from 107k to 135k, 120k seems to be more or less the median of Google's figures.

Edit: added footnote

It was 2009-2010, so rents were lower, but my paycheck was lower as well (I started at only $100K/year base, compared to the ... well, much higher amount a few years later). After taxes and 401k, I netted $5400/month. 18 months encompassed 2 bonus cycles, so about $40K of that was bonuses, after tax. My rent was $900/month with roommates, and then $1400/month in the 1BR, and total monthly expenditures were about $2K. I was packing away about $3.5K/month; 18 months of that is $63K, +$40K from bonuses = just over $100K.

Thanks for sharing your numbers.

You must admit that $40k bonus after tax is a huge, atypical amount of money. It makes your effective yearly income to be about $156k.

It reminds me of the mrmoneymustache.com guy, saying "anyone can retire early! Just look at me, all I had to do was get $1M in stock from Cisco!"

No disrespect intended for you; I'm sure compared to some of your friends you lived frugally. The point I'm making is that to duplicate your living standard today, very few comparable developers would be able approach your level of savings.

It's over 2 years. $20K or so after tax per year. A bit over $30K pre-tax.

Not sure what typical bonuses are these days, but I don't think that's out of line for a big tech company. Certainly stock grants can be much more than that, but it usually takes more than 18 months for them to amount to anything.

Thanks for sharing numbers. Wow, that's an amazing bonus, and you should feel fortunate! This is coming from someone who does work for a big tech company. I've never seen anything remotely close to that.

It's out of line for people who are not at big tech companies with publicly traded stock or bonus.

not for the bay area; and really, that's the point...

I will unequivocally state that a total comp of $150k+ for a new grad is at the very least, the top 5% of software development salaries for that level of experience.

was the op a new grad? sorry, I missed that. yes, $150k for a ncg in the first year is high. but honestly not that high, and for a 2nd year... doable from my experience [1].

[1: I am an engineering manager at Google]

Yes, doable at Google, a company known for being at the top of the market in compensation.

The whole point of the original statement was "I made $X and saved $Y, it's not that hard." But when you examine the X and the Y, they are not representative at all!

It has similar merit to a lottery winner saying, "why can't you win the lottery too? All I did was buy a lottery ticket."

Google pays substantially more than that - matching that number does not put you at the top of the market. Companies paying that much include many of the largest tech employers in the area. Compensation for job switchers has been increasing rapidly since the no-poaching ring was busted, but you have to know to ask for it. Lots of people are anchored from that period and don't know what they are missing.

Well, good for you. I don't think your situation was "average" really, but kudos on the savings :) Coming from a guy in NYC whose monthly expenditures are through the roof...

Single person $150k gross pay (salary, stock, bonus). $94k net pay according to this: http://www.paycheckcity.com/calculator/salary

Not being very frugal:

  - rents $2000K/mo 1BR apartment (single but wants some comfort in the Peninsula, no hellish commutes from East Bay)
  - transportation $200/mo
  - free lunch (and possibly dinner) at the company - eating out and groceries $300/mo
  - entertainment $200/mo
That's $2700/mo. Let's round it up to $3000/mo because you're a well paid software engineer and can spend $300/mo on top of what I listed whenever you feel like it.

So far, $36k expenses + $50k savings and you still have $8k left to go on ski trips to Tahoe, Outside Lands and other non-frugal lifestyle expenses.

A decent 1BR on the peninsula (in San Mateo, Redwood City, Mountain View, etc.) is likely closer to >$2,500 a month plus $200/month for utilities/renters insurance. For transportation, I pay $200/month for a 15 year old Civic with liability insurance. If you have a moderately nice car that isn't paid off, you are going to pay >$200/month (especially if you commute daily). If you cook moderately nice meals and drink some alcohol, that food budget is likely going to be >$400/month. Plus going out to happy hour once a week, which isn't that uncommon, can easily cost you an extra $30-50 a week (or more). A good number of people have college debt as well, so add a monthly payment for that. I agree with you that saving is definitely possible when single and making >$100,000. I just think you low balled most of your numbers to prove your point.

If we're talking about low balled figures, I guess we need to consider the income side of the equation as well. The original question depends a good deal on what kind of job you're doing in the Bay Area. If it's someone coming to the Bay Area to work for Google/Facebook or similar, the figure I used is way too low, for example.

"A decent 1BR" - It all depends on the definition of decent. I pay $2k for a 1BR walking distance to Redwood City downtown/Caltrain.

But forget about renting an apartment, if you want to save and you're single, having roommates allows you to rent in the Peninsula for much less than $2k/mo.

Also, I added $300 discretionary spending which lets you to cover some of the things you described, and you're left with $8k at the end of the year.

Can you easily save $50k while spending $3k on rent+utilities to live in a fancy apartment in the Peninsula ? Maybe not, but you certainly don't need to be "eating garbage dumped by grocery stores".

> Maybe not, but you certainly don't need to be "eating garbage dumped by grocery stores".

Nice strawman :) I was specifically talking about the situation conditional on saving the 100k in 18 months, my comment was a response to the comment above it.

Separate point: your figures seem very low. I thought SF is roughly equivalent to NYC in terms of cost of living. In which case 300/mo is a zero off as an estimate for all food expenses.

Sure, I did this (and more if you count my 401k). I don't think I was that frugal: I certainly didn't want for anything, and ate my fair share of sushi.

Like the article mentions, saving a lot is easy if you're fine with a roommate and living in a non-luxury apartment, but if your housing standards are higher than that then it's tougher.

This is, of course, at the compensation levels talked about in the article. Some companies (early stage start-ups, banks) pay much less.

I went from a net worth of <$50k at age 20 to >$150k at 22, while never being particularly frugal at all. Heck, I didn't even have roommates. My monthly spending averaged $4k/m.

NYC, not SF, but the difference isn't huge.

Most people are atrocious with their money by either overspending or under-optimizing.

OK, it all depends on what the cash flow looks like :) You're leaving out that one very important piece of the puzzle...

Also, the average apartment in Manhattan (if you do rent without roommates) is pretty close to your cited figure for total monthly expenses. Which means you either lucked out, or seriously compromised on your living arrangements.

> OK, it all depends on what the cash flow looks like

I was making $150k/yr, which is pretty standard for a developer in NYC.

> Also, the average apartment in Manhattan (if you do rent without roommates) is pretty close to your cited figure for total monthly expenses.

I take it you don't live in NYC. The average is a useless metric because it's distorted by millionaires and billionaires. Just go on Craiglist and you'll find plenty of suitable apartments in the $2-3k range.

Nobody I know pays more than $3k/m for their apartment. Heck, my friend just rented a beautiful luxury single-bedroom for $2.8k.

In my case, I chose to go for a non-luxury apartment for $1.8k/m. This was definitely a deal, but even though it wasn't luxury there was plenty of space and I even had a back yard.

> I take it you don't live in NYC.

I do.

> Nobody I know pays more than $3k/m for their apartment.

Few people I know pay under. We live in parallel dimensions I guess.

> In my case, I chose to go for a non-luxury apartment for $1.8k/m.

I don't know what NYC you live in, but this is non-existent AFAIK. I know someone who went all the way to Rego Park (this is really far from Manhattan) to rent a 1BR for $2.5k.

I did it, paying $3400/month rent & supporting a family. Salary took care of living + unexpected expenses, and stock grants/purchase plans took care of the saving + knowing where to keep the money (thanks, years of scraping by on non-SF-ludicrous pay packets).

edit I don't know what a 401k is good for (I already have two retirement saving schemes in other countries), mostly did staycations since SF is such a tourist destination.

When you say a typical engineer's salary, I feel like you mean a high performer at Google with a rich family.

I make about that much, at a company without free food perks that doesn't give me amazing stock bonuses (my social skills are too bad to negotiate them…) and I live frugally but could never save that much after $2k/mo rent! And there's no huge parental loans for me.

Even with generous wages house prices are rising faster than salaries. And let's be frank about this, when well-paid sw engineers are feeling the squeeze, imagine how awful the economic situation is for anyone in a less fashionable job. There are lots of people who work just as hard as any coder and whose jobs are just as necessary to a livable economy but who face certain economic ruin if they lose their lease - hence all the pressure for a $15 minimum wage. Meanwhile a lot of people who already own property fight tooth and nail against any large-scale building. It's a vicious circle.

>It takes about 2 years to save up $100K on a typical Bay Area engineer's salary, if you're fiscally prudent.

Read: Don't have a family and don't do anything special, like take vacations.

Also, average rent is $3600/month. That's over $43k a year. That leaves $17k for everything else, following your plan.

A single person does NOT need to spend 3600/month in SF. That's crazy. A studio/1 bedroom can be had for 2500. And if you're willing to compromise on location (i.e. "the ghetto") you can get under 2K.

Families that need 2+ bedrooms and a good/safe neighbourhood are screwed though.

You don't have to live in San Francisco. There are plenty of nearby cities with cheaper rent.

Not sure why this was downvoted.. I live in Berkeley and a 2bdr here is cheaper than a studio in the city.

Yeah, a lot of times people seem to talk past eachother because to them, SF = bay area. In reality it's a small portion of the population and even smaller portion of the land mass of the actual bay area.

If you live in a nearby city, shouldn't you factor in transportation prices along with the rent?

But then you'll have to likely sacrifice several hours of your day just to commuting.

...like Sacramento.~

Even San Mateo, which is not very far away, costs a lot less. And if you work in SF and commute from the East Bay via BART, which isn't too bad, you can save even more.

You would have to be extremely well paid and frugal to save $100K in two years. Sure, it's do-able, but wow. Of course, this is HN, so there's always someone who knows someone's brother's roommate who makes $150K/year at Google but that's a pretty high salary. And to be able to keep $50K of that given the cost of everything? I don't see how it's possible unless you are single, have no kids, no existing debt payments, don't put anything away into IRAs, 401ks, etc. and are are extremely frugal.

But if you do and are, you have $100K. Congratulations. That does you no good when homes are $1M+. Keep saving.

I agree with your premise but I suspect your numbers are a bit off.

Regardless, whether it's 2 years or 3 years, to do the lifestyle you're suggesting takes and incredible amount of willpower to be willing to sacrifice and prioritize. It's passing up that cell phone upgrade. It's cutting discretionary spending to zero. It's passing on happy hour and bringing lunch every day.

While feasible, it's hard.. but suffering for two years to benefit for a decade. Quite possibly worth it.

It's worth pointing out that is just for the down payment. If you want to get ahead in life you need to be "saving" that much and more every year. And oops, your expenses just shot up dramatically because now you're a home owner.

BTW everybody knows about mortgage payments/rent but many forget about property taxes you have to pay as a homeowner. That's about 1.5% of your house purchase cost every year. Of course, there are tax deductions for that but even after them it's still non-negligible chunk of cash on homes approaching $1M.

Anecdote to back up what you wrote:

When I bought my first home my loan (P+I) payment was $1300 per month on average (paid every 2 weeks), which was not only affordable but cheaper than what I was renting at once you accounted for interest deductions! But the taxes were somewhere around $500 a month after the township raised local property tax by the maximum year after year. Due to average daily balance laws and escrow regulations, we often had a substantial amount of money "invested" in to our escrow account.

There was no amount of deductions to make this home an asset. It pushed a good quality home at a great price to something that now remains completely unoccupied.

My situation is 100% atypical - but I more meant to illustrate how big of an impact property taxes can be.

Don't forget about home repairs and renovations, HOA, and services like gardening, etc. depending on what you buy.

It is easy to end up spending double rent on a comparable place. The difference is for now at least the home you buy can grow nicely so you need to do the math on rate of return for that vs other uses of that cash.

And closing/financing fees! If you end up taking a job out of area and decide to sell(understandable as now isn't the right time to be purchasing a rental) you're out the fees.

Oh yeah, those. You pay through the nose when you buy and when you sell. Can easily knock several percentage points off the price you thought you're selling for, or add the same to the price you though you're buying for. One has to be very careful to include those in all calculations. Renting is mostly flat-rate experience, and owning has much higher variance of payments. But owning has its own benefits :)

If you live in an area with closing fees on rentals, like I do, rhat's a wash.

Those are all expenses your landlord has to pay if you are renting. If those costs plus mortgage is double rent than either landlords are hemmoraging money or something is seriously fucked up with the housing market.

True, but when you rent, the cost is obvious and stated upfront, however ownership has many hidden costs that are not apparent when you consider only purchasing price.

Your comment doesn't really make any sense, because there is no benefit to having a conforming loan. In fact, there are drawbacks. Recent data showed that jumbo loan rates were LOWER than the equivalent conforming loan. We bought with 10% down on a jumbo and because it's not federally-backed you don't have to pay PMI. Mortgage, taxes, insurance, that's it.

Also, I don't know anybody who got that kind of parental help or put $500k down.

That was the reasoning given by a coworker who did this, and he put $500K down. I personally know at least 3 people who've bought Bay Area houses/condos in the $1.1-$1.2M range with multi-hundred-K parental help.

November 2013: http://money.cnn.com/2013/11/12/real_estate/jumbo-mortgages/

September 2016: http://www.bankrate.com/financing/mortgages/jumbo-home-rates...

From TFA "the jumbo loan is supposed to come with a slightly higher rate". IMO the rate should be a LOT higher; otherwise PMI is always a losing proposition. Bizarre market forces indeed.

It was certainly surprising/counterintuitive that jumbo rates would be lower than conforming, but even when they're not, it sounds like they're incredibly close.

That said, if someone wanted to throw $500k at me to buy a house, I wouldn't turn it down :)

You should not buy a home unless you are going to live in the same place for 10+ years. Especially if you get a rent controlled apartment, owning a home does not make financial sense in the bay area.

The other big thing to help with home ownership is to get married. With double the income it is a lot easier to save for a downpayment.

If you're a HENRY (High Earner, Not Rich Yet), and have a good credit score (>740), you might qualify for a mortgage with 10% down payment without PMI/second mortgage.

With a frugal lifestyle, 10% should be doable in a couple years, especially if you're okay with living in the East Bay (so the house price is somewhat reasonable).

I'm certainly not agreeing with the value prop of the Bay Area, but PMI is actually not such a bad deal if you have prospects. It's not very much extra a month, and now you can get it removed after you have 20% equity in your home by request.

I mean you only have to pay PMI till you have 20% equity, so it's not necessarily so bad.

Or you just save up to buy a home elsewhere.

Isn't the rent just as high?

No. The housing market in SV makes renting cheaper than buying.

On an engineer's salary, it is very doable to pay rent and still save up enough to buy an entire house in cash elsewhere in the country.

When people compare salaries/cost of living in different cities, I think they probably look it up online, where the data is already summarized.

The cost of living comparisons I've seen are comparing the "local economy". They compare the cost of: housing, food, transportation, health care.

Don't forget taxes. Your taxes are 25% higher in San Francisco compared to Seattle.

Which taxes? Marginal California income tax + MediCal is about 13% at the $120k bracket.

Seattle has no income tax, and sales tax doesn't apply to most food from the grocery store, so taxes in Seattle really depend on how you choose to spend your money.

Washington state will ding you in other ways to make up for the lack of an income tax...e.g. more property tax.

Actually Seattle's property tax is pretty good. You wouldn't believe how unprogressice WA is in practice.

Lyman Stone has a good blog post[1] suggesting that it's rational for Millenials loaded down with student loan debt to live in high cost-of-living regions, for exactly this reason. The high nominal incomes give them more power to repay their student debt, which is not cost-of-living adjusted.

[1] https://medium.com/migration-issues/millennials-have-less-de...

This worked for me. I borrowed way too much money going to school. As a fresh MBA grad in the suburbs of Los Angeles, California, with few marketable skills, I couldn't find any career options that would offer a starting salary that came close to covering my costs.

My big break was finding a job in San Francisco. I charmed my way into an entry level sales gig with a base salary of about 35K USD (in 2004), and was soon making at a 70K-ish "annual run rate" (stealing that from startup PR lingo). And that job did all of the lead generation for me. I wasn't able to find a job like that outside of a big city.

Even when I was homeless for a bit a few years later, I chose to stay in San Francisco over moving in with my suburban LA parents because there I saw more opportunity in San Francisco. For me, it was riskier to play it safe in the burbs than hustling in San Francisco. It's better to burn out than fade away.

The way I see it, if you wanna make it as a professional, and you don't have a reasonably understood career path to follow, it makes sense to go where the money is. You can live financially cheaply in most places, and you'll have to decide how much you're willing to work for it. For me, living in San Francisco is, and has been, worth it.

Which leads to a funny observation -- I have never seen so many expensive German automobiles in cheap apartment complexes in my life. Driving elsewhere makes you wonder where all the fancy cars went.

I agree 100%. Right now in SF and get paid relative to SF. If one day I return to the Midwest (or almost anywhere else) what I have in the bank has more buying power.

Never thought of it that way. Percentage of income consumed by state and local taxes, housing, etc compared and average gross income would show the whole picture.

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