sounds like it's not the place for you. a household making "only" $120k, no matter where you live, puts you in the top 15% by income in the US--hardly the "working poor" (see census data).
trying to keep up with the joneses, on the other hand, can warp your sense of relative privilege. top 15% in the US is among the top few percent in the world. keep that in mind, and that'll help assuage the negative feelings that can arise from comparing yourself to those you otherwise consider your peers.
This isn't just about "keeping up with the Joneses." Most families want a) a decent home, and b) a good education for their children. I had to pay an obscene amount for a) in SF, and I was holding my breath while figuring out how to pull off b). My quality of life otherwise was relatively ordinary: I drove a Toyota and didn't go out all that much due to the newborn.
I made a princely sum compared to the average American. Had I lived in average America, I would have lived like a prince (you could literally buy a mansion for the price of my 3BR home in most places in the US). But since I lived in SF, I could only barely afford the basics. This has nothing to do with skewed expectations on quality of life — it's about the skewed economics of the city.
that $160k figure is for residents of san francisco, not the nation as a whole, which is what i was quoting, and is the whole point of what i posted. you're comparing yourself to your neighbors, not the nearly 7 billion other people on the planet or the 270 million americans who are less well-off than you. relatively ordinary is relatively amazing for the rest of the world. it's about perspective.
You don't understand what it costs to live here. Keeping up with the Joneses means envy for new and shiny, not wanting a modest house, cars, kids, and retirement savings. And here, that means an income of $250k is tough to do -- one bedrooms in sf are $3500; condos in the peninsula sell for $700k+ and houses cost $1100/ft^2.
$240k married filing jointly w/ 2 kids means $5900 hits your bank account twice a month. Essentially all of one of those paychecks will go to housing in sf, or a mortgage + taxes on the peninsula. That leaves $6k per month to live off -- which is certainly doable, but between childcare (at least after school w/ both parents working, possibly more), utilities, telecomm, cars, savings, groceries, and all the miscellaneous costs of life such as clothes, doctors visits, etc -- you aren't saving much money.
ps -- it's stupid to look at national statistics for income when this is the #1 most expensive housing market in the US. At least nyc has good transport options between Manhattan and Brooklyn / Queens. Here we have caltrain or the 580.
I mean, here's a home right here [1] -- 4 bedrooms for $315k! Of course, it's in Madison, WI -- but that shows housing prices are just fine in sfbay :rolleyes:
@smtddr: we're not discussing what most people have; we're discussing what you can get in the bay area on $240k. Otoh, if you're now claiming that keeping up with the joneses == a middle class life, ie wanting a modest house, cars, kids, and retirement savings, then the plutocrats have won.
Yeah, that thought pattern does explain much of the dysfunction in american government
The salient fact of American politics is that there are fifty to seventy
million voters each of who will volunteer to live, with his family, in a
cardboard box under an overpass, and cook sparrows on an old curtain rod, if
someone would only guarantee that the black, gay, Hispanic, liberal,
whatever, in the next box over doesn’t even have a curtain rod, or a sparrow
to put on it. - Davis X. Machina, balloon-juice.com
that perfectly captures the zeitgeist of the 90s on...
What I'm trying to say is... I'd be more interested in getting a bigger chunk of society to catch up to our level than us complaining, getting more and widening the gap between us and the rest of middle class USA. Basically, I think bayarea tech folks are doing pretty good and the ones who are truly suffering are the ones not in tech. The imagery[1] in my mind is like those 3-legged races where 2 people tie one of their legs to each other... the bayarea-tech guy is in full speed mode and the other person is being dragged on the floor, taking all kinds of scratches. Can we at least give everyone else a chance to catch their breath before we talk about dashing ahead even further than we already are? And we definitely are ahead.
As Peter Thiel has observed, if we tried to bring the world up to an American middle class standard of living without changing anything else, we'd quickly destroy the planet. So your choices are a: leave everyone else poor (a.1: wait til the oil runs out so we're poor too), or b: find some way to get us off oil and other things that keep us from raising that standard of living globally.
Silicon Valley, at its best, is doing exactly that. And sure as hell isn't anyone else trying.
Having always lived in the Bay Area, I find it hard to imagine it is tough to live on a combined income of $250k. That's at least top 10% of household incomes in the Bay Area. No, you won't get any neighborhood there is, but 80+% of places are open to you.
First, $5900/month is a huge amount to spend on housing. Large houses on the peninsula rent for around the $4500 range; you only hit $5900/month for 4 bedrooms in the hottest neighborhoods of SF.
Paying $5900 (after tax deductions, including property taxes) for owning a house implies a $1.3M mortgage, so maybe a $1.5M house(?) which is high-end. Houses that cost over $1000/sq foot are very rare; most are in the $600 range looking at Zillow on mid-peninsula.
Also, note that owning a $1.1M house is a form of retirement savings, so you can adjust accordingly.
And housing costs differences of $800k over 30 years (your Madison link vs. a $1.1M Bay Area house) is about $3300/month. You need to earn maybe $70k (before taxes) more in the Bay Area to have equal non-house income. I find it hard to believe that earning $180k in Madison combined (top 8%) is struggling.
Finally, there's always the Easy Bay: great houses in great neighborhoods for $800k.
A home requires: pmi (possibly, often on jumbos) until 80% ltv; insurance, at $300-$350 per month per million dollars; taxes, at roughly $1k per month per million dollars; earthquake insurance, particularly if you're near a fault line; and maintenance, of which I'd budget $5k/year on a million dollar home. Maybe more for CAs housing stock. So that $6k becomes $4k for a mortgage.
Using a house for retirement savings is for idiots; that's an enormous gamble on the future of CA 35 years from now.
The Madison house, btw, is in a location walkable from many offices; Madison is more competent than the bay area, so while buses aren't great, the roads are very drivable in many directions. Someone with even an hour long round trip commute has a very long commute there (except, perhaps, after snowfall.) So you could probably use one car, or one commuter car and one beater car for a couple. Not two cars as you need on the peninsula or sf for a couple with kids.
Not to mention that $70k doesn't capture all the other things significantly cheaper in Madison: food, daycare, and education (many Madison schools are quite good) being the most important. Many peninsula schools are quite good, but not in sf.
Cost wise, I did ignore insurance costs, but yours needs to factor mortgage interest deduction. You might be getting income taxes reduced by $2k/month.
If you view it as plausible your house value will collapse, you shouldn't buy a house. If so, you'd rent and you'd be looking at much lower housing costs.
With regards to cost of living: some things are much more expensive in Madison; e.g. utilities (no A/C needed in Bay Area; heating rarely needed).
Not entirely sure that owning a $1.1M home (now) is a form of retirement savings; I wouldn't be surprised if, by the time I retire in 40 years or so, Silicon Valley looks like Detroit. A bunch of parallels are there: single-industry region, large amounts of shoddily-built tract housing, and a mobile, transient worker population chasing the latest hot industry.
Anecdotally, I know a gainfully employed senior engineer who was literally couch surfing with his wife and daughter for a month after losing their house. The excessive price of living caused by the housing shortage in the bay cannot be understated.
Compared to the worst neighborhoods in London? Because the Mission is one of the worst neighborhoods in SF.
Also, please note the /sf (per square foot) of his price quote. I also thought it was way too cheap even for the Mission in SF, until I noticed the /sf.
If house prices are as bad as HN indicates I can understand how that income could put a person if not in the "working poor" then into the lower middle class.
know that competition is tight enough that if the apartments are decent, they will be rented on the spot during the showings, and often for much more than the asking price. An acquaintance was looking for months and finally got an apartment because he and his roommate offered $250/mo over asking.
trying to keep up with the joneses, on the other hand, can warp your sense of relative privilege. top 15% in the US is among the top few percent in the world. keep that in mind, and that'll help assuage the negative feelings that can arise from comparing yourself to those you otherwise consider your peers.