There is some strain and resentment in our relationship over our income differential, sure... especially when I want to complain that I'll never be able to afford a 1.4 million dollar house on the Peninsula because I only make 150k. It's just pointless to even bring that up to him because I know I will come off as an ass. However in some ways, he has it better than me. He and his wife bought a nice 4 bedroom rancher on a half-acre lot with an inground pool for 120k- which I will never ever be able to afford around here in my lifetime barring some unicorn ipo.
My cousin who lives in LA heard that and told me I couldn't rent somebody's closet in LA for $500 / month. With all of the remote work opportunities, it actually kinda blows my mind that more people don't move down this way and work remote. On sheer cost of living it would be like giving yourself a huge raise.
Over the last 2 years at my company the percentage of remote workers have increased dramatically. They all used to sit in cubes, but now they sit at home on the couch.
I live in a city of about 60k with a median household income of 47k. My cost of living is low too and I tell everyone I love where I live. I couldn't imagine having an income of 100k-150k and not being able to live a nice life and not being able to afford "the American Dream".
http://www.zillow.com/homedetails/103-Baker-St-Cooperstown-N...
...looks pretty nice, with a good sized yard.
I'm simply at a loss for words...
http://www.zillow.com/homedetails/12169-Findlay-St-Detroit-M...
...1029 sq. ft. for $1700. But if you are looking for real rock bottom prices, it is hard to beat $500:
http://www.zillow.com/homedetails/14421-Wilfred-St-Detroit-M...
...There are photos of the interior, and it looks like it is in a good neighborhood on Google Street View:
https://www.google.com/maps/place/14421+Wilfred+St,+Detroit,...
Call me impressed. I wonder what the closing costs are on a property like that.
No regrets. Thanks for sharing your space.
I moved here from Boston three years ago. I love taking advantage of the remote work environment, living in a lower cost area, and I feel Myrtle Beach is a gem, to have such low living cost, and big city amenities, due to all the summer tourists.
I was able to buy a detached single family home, 2400sqft for half the cost of my 1000 sqft Condo in Cambridge, MA - just outside Boston.
I maintain a list of remote job sites at http://LX.tc/positions - so that I can share with those I bump into, about the prospects of working remotely.
Been going down to Murrells Inlet/Garden City my whole life.
In the rest of the country, which is fairly sparse, you can find high standards of living, minus some of the extras you'll find in the rich, dense, coastal areas (extras usually in the form of various culture and activities). However, due to the lack of local demand, the prices are lower.
This creates hugely variable economic conditions on the order of the differences between London/Paris and Budapest.
Housing, like anywhere, dominates living expenses after taxes $30k/yr income looks more like $22k/yr. There are single bedroom apartments, not fantastic, but pretty nice, around where I live that are $2k+/mo. Now you have no money for food, transport, clothing, hobbies, etc. You can find cheaper places for around $1.5k+/mo (there are no housing options here under $1200) but that still leaves you pretty thin with $4k left to spread across the entire year for other necessities.
On the other hand, in Omaha, Nebraska, I found some comparable apartments at $500/mo. Which gives you a little more than $1k/mo for the rest of the year. You'll probably blow through half of that on food and half of that on car expenses (cheap housing in the U.S. implies almost no public transport options) and now you still have no money for savings or hobbies.
The median income in the U.S. is ~$54k/year (about the same as Europe but a hair higher). But that also means children, a couple income earners and so on.
Note that the average local more or less intentionally can't afford the time or money to visit the tourist traps. If you are not rich and want to visit the museums and galleries of Chicago, or attend a Bears game at the stadium, or a music concert, you can't live in Chicago because then you'd be too poor, you have to live elsewhere and visit.
What dense, expensive, low standard of living areas provide, is extremely dense employment. No matter how unique your job is, there's dozens to thousands of positions within walking distance of your current employer. In the more rural areas you'll see a lot more sinecure behavior, retired in place, people who've worked the same place for 20 years, nobody (such as yourself) gets promoted because the company doesn't grow and nobody quits, etc. Long term relationships are comfortable and lower stress on average, yet also less exciting and less adventurous, just like with love life.
There are also minor behavior constraints. If there's 50 companies all doing the same thing in a big city, then stack ranking basically wastes a lot of HR money pointlessly shuffling people every year, but at least its possible, whereas in a rural area especially if its a company town, stack ranking would rapidly destroy the company because the applicant pool is too small to sustain bad behavior. As a gross generalization people tend to spend far less time commuting in rural areas than urban, but the rural commute has more (high speed) miles so it is more expensive, in the city a twice a day rush hour commute might waste more than two hours of precious life per day, but at least its short therefore cheap, whereas in the country it'll be a comparatively lightning fast 30 minutes each way, but at 80 MPH and 50 cents per mile, that'll be an expensive 40 mile daily commute. City people are amazed how much rural people spend on their commute, rural people are amazed how much time city people spend on their commute.
Ah, but that's an American perspective. In Britain museums and art galleries are generally free, for exactly this reason.
However, the free days are often during the weekdays and I think during work hours, so lots of working people can't really take advantage of them very often.
Yes I know Dublin isn't a suburb of London or whatever, but culturally its not that far away.
Ireland's economy and cultural sector is distinct from the UK's and much smaller. The Guinness Brewery and Book of Kells are really exceptional cases which cater to wealthy international tourists. They have little to do with local cultural life.
PS: You can actually just flat out save 1 million by mid 30's working for big co.
Yep, if you're serious about saving, this is entirely doable. I'm not at all on track for this because I'm not dedicated enough. But when I lived and worked in the bay, I knew a couple of guys who saved >50% of their take-home every year. They maxed out their 401Ks in the first few months and then redirected the money to other savings. Someone earning $100K before taxes can absolutely save a million in cash by saving aggressively for a decade and a half.
Hell, my roommate in grad school earned $30K/year and managed to save $10K one year, despite buying a (used) car. This was the result of cheap cost of living and generally just being really frugal.
This is true for Wisconsin also. I think OP is hitting the right point that many states easily allow you to live comfortably at around 30k p.a. (after taxes). It depends a lot on whether you have a family or not, party a lot or not, materialistic in general or not.
>cheap housing in the U.S. implies almost no public transport options
I am not a citizen but this isn't true for Milwaukee where I have been living for almost 2 years now. I have not needed a car because bus service is awesome and Uber (or Lyft) help me out other times. It also helps if bike tracks are good in your city, so that's another factor to lookout for.
Furthermore, having money to buy unnecessary stuff for your hobbies is not the metric to go by. The more important metric is about what you're able to save. Important questions are:
* Are you saving enough money to ensure a comfortable retirement?
* Are you saving enough money to buy your children (assuming you have/will have them) a decent education?
* Are you saving enough money to cover medical expenses later in life?
* Are you able to set aside an emergency fund?
If the answer to any of those questions is "no", then you should probably be concerned.
[0] https://www.glassdoor.com/Salaries/software-tester-salary-SR...
If I´m not mistaken, Finland has free healthcare, education and generous welfare system (that you said you benefited from, as you should), all of these should be taken into account when making comparisons, since they factor in the taxes companies have to pay for hiring people.
That said, it still seems a bit low for Finland, but ok for a recent graduate.
Other sources aren't nearly as helpful, but they put me somewhere in the middle of all people (or something).
I'm sure some people earn more, especially closer to Helsinki, but currently I'm content with my earnings.
So don't be surprised we worry about money.
I was working at a video game publisher at the time and we tried to take advantage of it, being an American company but with roots in Japan, but there was some cultural and communication issues that helped lead to products that didn't sell too great and negated all benefits of cheaper development in the first place.
I wouldn't be surprised if many of those companies are still struggling today.
To a first approximation, how much house does your $30k income buy/rent you where you live?
(Even within the UK, I went from "choice of buying 2 bed flat or renting a 3 bed one" to "4 bed detached house" at the same salary by moving further away from London).
Cost of living varies a lot, but overall Americans are pretty rich in comparison to most Europeans (in the sense of being able to afford more imported Apple products made with child labor). Our median income is 35% higher than Germany and 50% higher than Finland. The flip side of that is that there is less of a safety net and having less money here is a lot harder. For example, our cheap urban neighborhoods are far more dangerous than comparable neighborhoods in most European countries.
It really is. However in Silicon Valley cost of living is so expensive that earning 100k/year still makes you relatively not all that better off.
Where I live most of senior software engineers make around 30k/year with higher cost of living than in the US (excepting hotspots such as SV/SF/NY/...).
People who have spent their whole lives in places like California have no meaningful perspective. You get millionaires crying due to their "poverty".
Its if you have > 1 mill in liquid assets that you are a millionaire.
If you make six figures and are "house poor", it means you're either bad at making financial decisions or you feel the house is worth the sacrifices. Either way you aren't poor and shouldn't feel poor.
I am not poor, but I am not rich enough to get access to 1MM$ mortgages.
There is a difference between a bachelor pad in Bratislava Slovakia and a suite in Trump Tower - yet both are merely "appartments".
Please stop the ridiculousness of blaming "poor" people for the recent housing collapse.
http://thisamericanlife.org/radio-archives/episode/355/the-g...
If you think software developers in SV have it bad, imagine how it must be for cleaners and food service workers in the same areas.
This is what bothers me about SV devs bemoaning how high the cost of living is. The self absorption is really offputting. Oh, you can't afford a house in Palo Alto? How sad for you. The guy cleaning your table probably commutes for an hour on BART and still spends the majority of his money on rent.
I lived in the bay area for a while. I get that housing is absurdly expensive, to the point that six figures doesn't feel like a lot. It is a lot, though. Saying things like "six figures isn't really much money" is just tone deaf. You aren't poor on six figures.
On the downside, the state is economically depressed and is probably never going to get better. NAFTA plus the decimation of american car manufacturing really fucked them. My family have jobs but they don't pay well (I've bought groceries for a sibling) and it's not likely they will ever be paid even $50k/year -- enough to own a modest home, buy a car every 10 years, pay bills, and have savings -- in a relatively stable job. My brother similarly can't leave because of a joint custody agreement.
Also on the downside, these wages make it impossible to ever really retire. You can't save for retirement if you area barely making ends meet. I don't know anyone working a low wage job that looks forward to doing the same job until they die.
You can too. Buy it now, and leave it. Once you are done with Silicon Valley madness you can always go back and settle there(May be even retire?).
("Dirty Santa" is where everyone brings one gift -- we do $10 -- and then you play a game where you either open a random gift from the pile or steal someone's opened gift. It's pretty fun. To me it's more fun than "real" christmas gifting...)
Edit: Wikipedia page: https://en.wikipedia.org/wiki/White_elephant_gift_exchange
Because my dad became a doctor he was able to put me and 5 of my cousins through college. He makes the original decision and my entire family is completely different today.
Granted, we wouldn't know the difference.
Not just key, those are life altering decisions. I still remember my friends who chose civil/mechanical engineering over CS'ish fields(Electronic, IT, Computer science) because they wanted a better college, than a better course. I remember friends and cousins who chose to go into fields like literature/arts. I remember kids in my school who dropped out because their father's business was good enough. Most of them aren't doing good. But back then they justified their decision on all sorts of grounds, yet they didn't have to make them at all.
At each step it felt like I was getting lonelier along the way. It was tough, but it was worth it.
People make stupid decision and they make them for no rational reasons at all.
Here is another hint, your sister and you are probably even now making small decisions over time which will make you 10x worth more than her, another 15-20 years from now.
Small decision add up to big things. Especially the kind of decisions which can change the direction of your life.
Incremental money at the lower end is worth way more. Inequality is the problem.
How do you reconcile this with the claim that inequality is the problem?
If you take a long look at that same graph [3], productivity has climbed, dramatically. Perhaps the depression of wages was caused by almost doubling the workforce, adding women.
Eh, it's probably not that big of a deal. that wsj article pointed out it's really just young men without much education that are taking the hit. I really doubt having millions of young, broke, easily persuaded males will cause much of a problem. Historically, that's always worked out just fine
Less snarkily, economists from Greenspan to Krugman have said this is something that needs to be looked at. It's an indicator of something being not right. It's clear you have an economic model in mind. It's the job of the market to push that pay edge as hard as possible, get as much productivity for as little pay as possible. Have you considered that the market might push so hard that your economic model doesn't apply?
[1] http://blogs.wsj.com/economics/2015/07/06/just-how-stagnant-...
[2] http://www.epi.org/publication/ceo-pay-continues-to-rise/
[3] https://upload.wikimedia.org/wikipedia/commons/4/45/Producti...
Everyone getting richer is not an accurate description of reality.
The more you already have of something the less it's worth to you, that goes for almost everything including money in this case.
It's a real shame, because it is literally impossible to solve a problem you deliberately misunderstand. That's humans for you though.
Don't play dumb. They're going to break down crying when they're told what our planet went through right now. It will be like when today's children are made to really look at photos of Auschwitz, or the Syrian Civil War, or guinea-worm cases in Africa, or child labor in coal mines.
Oh wait, some of those things are still present-day problems.
Note that the article assumes poor white people all have salaried jobs with great medical insurance plans, or at least get sick pay. Of course they don't.
Therefore the article doesn't understand that lots of people fall into the trap of not fixing something when its small, and instead end up lowering the average lifespan.
Look at, say, alcohol addiction. Lack of medical coverage means if you got treatment your whole family would get the economic death penalty via direct and indirect costs, ruining all their lives, or you can auger in and ruin just yours. Either way, all outcomes of addiction are decreasing average life span.
Besides pay one of the largest burdens the poor face are all the government fees and indirect taxes that most of us don't notice in our daily lives. That twenty dollar tag fee renewal to me is nothing, but if you have to have a car and aren't clearing much twenty bucks can mean beans and rice.
Government already has the ability to track all fees paid it directly and can make assumptions about indirect fees so that the working poor; far different from the non working poor; can be relieved of some of the burden.
The only other option for solving inequality as many bemoan is to take from those earning so much so they really don't see the point and eventually everyone ends up poorer.
As well as focussing our discussion on economic equality and social justice, we can also approach the problem from a perspective of enlightened self-interest.
Widely distributed economic equality implies a greater ability to spend, and a greater ability to borrow, and a greater ability to create wealth in aggregate.
A wider distribution of wealth, on average, yields greater wealth overall.
This doesn't imply equality -- just a distribution of wealth that is closer to a Normal/Gaussian distribution, with less of it's "energy" disappearing off into the upper tail of the wealthy -- a tail which is necessarily inefficient due to its' bandwidth constraints and limited decision making capacity.
Let me suggest one of those data-driven analyses you like: for a set of equal-population regions or some such (ideally not just countries, although that might be the only way data is available), plot a happiness measure against mean wealth (income might be easier to get figures for) and Gini coefficient, and do a linear regression or similar. That should give a formula for how efficient wealth redistribution policies need to be (i.e. how much they need to lower the Gini per dollar-per-capita expended[1]) to be worthwhile in terms of increasing overall happiness.
[1] Of course actually redistributed dollars aren't expended and don't change average wealth at all. But the redistribution programme would involve a certain amount of labour that could otherwise be used productively being redirected to administration, court battles, police etc. and the value of that labour is expended.
Or in this case, would you recognize that correlation isn't causation?
Yes, although surely segregation just moves people around and can't change the average percentage, and so the net effect would always be zero.
> Or in this case, would you recognize that correlation isn't causation?
Do you think the causal factors are different then? I think inequality directly causes unhappiness in and of itself. That matches my subjective experience and the rhetoric I hear from many others.
Inflation is a separate problem.
Back in the real world however, the relative price/value/production of things is not a separate problem...and since I'm guessing most people's objections to inequality is not its effects in some hypothetical world where all concepts are independent, but in the real world where they all connected, I'm not sure hypotheticals of this nature are often that useful...
If you want to claim that inequality somehow causes poverty (and poverty is the real problem), make that case.
> Inflation is a separate problem
It's not just inflation: supply/demand dynamics will be changed across income levels. For example bidding wars might cause rentals to go up, and the mother will be outbid (see: gentrification or recent news on San Franciso rents)
But I've been thinking about how much money I really need. I could have indulged in some expensive hobbies, but I can also get by with lesser equipment and practice the same hobbies, as long as I don't obsess over how "bad" that equipment is. And there are a lot of hobbies that either cost little to maintain, or that benefits other people. So there seems to be a lot of potential for reducing spending on oneself ones immediates and funneling some of it elsewhere (either through money, labour or time).
My sister gave me a $50 gift for christmas, and it brought tears to my eyes because she's a single mother making the federal minimum wage of $7.15/hr. That comes out to $290/wk, before taxes, if she's lucky and gets a full week's worth of hours. To earn that pittance, she is physically laboring and might have to work 7 days a week to get enough hours in the schedule.
It makes me feel like a douche every time I think about it. Me sitting there in my Aeron chair, eating free snacks while reading code. And making ~10x what she does. When I really think about it, from similar beginnings, only a relatively small number of key decisions separate our two economic outcomes.
I try to give generously to assuage my guilt. But I've found that there are limits to what can be given without stirring resentment, or provoking attempts at reciprocity. That's how this $50 gift came about... I bought some nice stuff for her kid, and she wanted to show her gratitude.