Possible career change - move to HCOL area and salary expectations?

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JHU ALmuni
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Joined: Tue Jan 20, 2015 12:40 pm

Possible career change - move to HCOL area and salary expectations?

Post by JHU ALmuni » Tue Feb 27, 2018 6:13 pm

Hi everyone. Need bogleheads wisdom regarding my personal career. Currently I live in Tampa, FL and make 96K a year plus ~8% bonus. I have been with my current employer for about two years and about to start submitting applications for new job due to lack of promotions/future advancement opportunities (plus I feel underpaid) .

I work in finance/compliance and most of the opportunities I looked at are located in NYC. Assuming I apply for roles that are close to my current role. What would be a reasonable expectation regarding salary increase considering cost of living difference between Florida and NYC is huge? I feel if I get 30%, it will barely cover cost of living difference and the extra taxes (no income tax in Florida).

Anyone made similar moves in their career? How did you handle cost of living difference in the process?

N10sive
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Re: Possible career change - move to HCOL area and salary expectations?

Post by N10sive » Tue Feb 27, 2018 7:06 pm

While I moved from a HCOL to another HCOL area, make sure you look at every single thing. I thought I would be getting some bit of a raise due to living in CA previously but with the sales tax where I currently live and all other costs involved its almost more expensive to live where I am now.

I wouldn't move to someplace like NYC unless I was making 200k plus. Getting a 30% raise from where you are, is correct in that it will barely cover the living differences if it even does. Making more money may also put you in a different tax bracket as well.

While you feel underpaid, have you actually looked into what the market rate is for your job in your area?

EJS22
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Re: Possible career change - move to HCOL area and salary expectations?

Post by EJS22 » Tue Feb 27, 2018 7:08 pm

I moved from MCOL to VHCOL and remember looking at cost of living calculators which said I would need to make 30 or 40 percent more for the same quality of life. The major mistake I made was not considering the fact I wanted to own a home in the new area and the salary required to do this would be almost three times what I was making to match the similar house I owned in MCOL. Speaking just financially, I would want to make at least 200k to live in NYC.

adamthesmythe
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Re: Possible career change - move to HCOL area and salary expectations?

Post by adamthesmythe » Tue Feb 27, 2018 7:36 pm

My guess is that your standard of living would take a hit in most ways for that amount of raise.

If you move, do so for the potential to move up quite a bit more as you gain experience. There are opportunities in the big city that you will not get elsewhere. But you may need to be a high performer to get them.

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Watty
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Re: Possible career change - move to HCOL area and salary expectations?

Post by Watty » Tue Feb 27, 2018 7:43 pm

JHU ALmuni wrote:
Tue Feb 27, 2018 6:13 pm
Anyone made similar moves in their career?
It was a long time ago but I moved the other way, to a much lower cost of living area. I was a software developer and I moved from the Silicon Valley to Portland Oregon. I was able to find a job where they matched my salary but I was at the top of the salary range so my future advancement was more limited there.

You can look up salaries online but my impression is in general that salaries don't vary nearly enough to make up the for the differences in the cost of living. What does seem to vary a lot, at least in technology jobs, is the amount of stock options and bonuses which be much higher in the high cost of living areas but that will vary a lot by company.

It is not only housing that is more expensive but everything you buy locally is more expensive in the HCOL area and I really noticed that when I moved to Oregon.

I did a post awhile back where I compared the price of an Applebee's menu item in diffeent parts of the country. Out of curiosity I just looked and at an Applebee's in Tampa their Build your Sample Choose 3(which was the first thing on the menu), was $12.99. In Brooklyn it is $18.99 so it is about 50% more expensive in after tax dollars. The higher tax brackets there would magnify the cost difference.

This is sort of like the international Big Mac index.

https://en.wikipedia.org/wiki/Big_Mac_Index

Of course things you can buy on line will be the same and big ticket items like cars will not vary as much.

Hiring people to work like a mechanic or plumber can be dramatically more expensive in the HCOL area since they not only have higher expenses but they may also tend to be in short supply in the HCOL area.
JHU ALmuni wrote:
Tue Feb 27, 2018 6:13 pm
How did you handle cost of living difference in the process?
I did very well financially by moving.

That said having worked in Silicon Valley for at least one "glamor" company that you have heard of really jump started my career and I got excellent training and work experience when I was there. I have no regrets about having worked there. Even twenty plus years later having that background still helped me stand out at times.

It is unlikely that working in NYC would be a good financial move but going there to work for five years as sort of a "graduate school" could give you great work experience that expands your skill set and would help you in finding your next job in some more financially desirable location.

I am not a big fan of NYC but for someone that is young and single that could be a lot of fun too.

You might also consider looking for an international job if that appeals to you, that could also be great work experience.

Trying2learn
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Re: Possible career change - move to HCOL area and salary expectations?

Post by Trying2learn » Tue Feb 27, 2018 7:54 pm

I'm not sure what is average or typical but I took a 55% raise to move from a MCOLA to VHCOLA. I also went from no state income tax to 10%. :oops: This was 2 years after grad school so part of the increase was expected after getting some experience.

I also agree with the PP. I wouldn't live in NYC on 130k unless it was a short stint to boost your resume.

runner3081
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Re: Possible career change - move to HCOL area and salary expectations?

Post by runner3081 » Tue Feb 27, 2018 8:03 pm

N10sive wrote:
Tue Feb 27, 2018 7:06 pm
While I moved from a HCOL to another HCOL area, make sure you look at every single thing.
Yes, everything. Taxes, car insurance rates, homeowners rates, auto licensing, utilities, etc.

keith6014
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Re: Possible career change - move to HCOL area and salary expectations?

Post by keith6014 » Tue Feb 27, 2018 8:10 pm

EJS22 wrote:
Tue Feb 27, 2018 7:08 pm
Speaking just financially, I would want to make at least 200k to live in NYC.
why not 400k ? :P

Although there are a lot of jobs in NYC and job types are much more interesting in NYC, the job market is also very competitive in Finance/Tech.

There are many many many qualified candidates who will work much below the magical 200k .

Housing in NYC is 5x as much as Tampa. Pick your top school district in Tampa Bay Area -- the likes of Hillsbourgh/Pinellas and choose a modest house; Now see what that would buy you in the NYC/N NJ area. You will get an idea.

stats99
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Re: Possible career change - move to HCOL area and salary expectations?

Post by stats99 » Tue Feb 27, 2018 8:27 pm

Born and raised in NYC and spent last 30 years in northern NJ. If you are single and this is a step on the way to $200k or $400k or partner, do it. If you want to boost salary and cv and then go back to Tampa or equivalent, also do it.

rgs92
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Re: Possible career change - move to HCOL area and salary expectations?

Post by rgs92 » Tue Feb 27, 2018 11:02 pm

What kind of house or condo/co-op do you need? (That is the main extra cost of living in NYC.)

If you just need a 1 bedroom for yourself, you could get a nice one-bedroom in Queens in a good neighborhood like Forest Hills/Rego Park for about $350-400K and easily afford it on about a $100K salary with a $100K down payment. Remember, you don't need (or want) to own a car in the city.

Examples in very nice area I found with a quick search:
https://streeteasy.com/building/gerard-towers/15o

https://streeteasy.com/building/110_31- ... t_hills/2c

It's a pretty easy/short commute by subway into the city (Manhattan), about an hour door to door midtown or downtown.

You could even find a nice 2 BR 2 Bath for about $500K that would work with about a $120K salary, which sounds within your reach.

Living in Manhattan is more, but that's kind of for rich people unless you live in a closet-sized place or way uptown, like north of Columbia U.

EJS22
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Re: Possible career change - move to HCOL area and salary expectations?

Post by EJS22 » Wed Feb 28, 2018 7:04 pm

keith6014 wrote:
Tue Feb 27, 2018 8:10 pm
EJS22 wrote:
Tue Feb 27, 2018 7:08 pm
Speaking just financially, I would want to make at least 200k to live in NYC.
why not 400k ? :P

Although there are a lot of jobs in NYC and job types are much more interesting in NYC, the job market is also very competitive in Finance/Tech.

There are many many many qualified candidates who will work much below the magical 200k .

Housing in NYC is 5x as much as Tampa. Pick your top school district in Tampa Bay Area -- the likes of Hillsbourgh/Pinellas and choose a modest house; Now see what that would buy you in the NYC/N NJ area. You will get an idea.
The 200k is a just a bench mark I have for myself to stay in the VHCOL area I am in now. I run into the same problem here with salaries. People may have more efficient housing situations (living at home with parents, partner makes more money, live with a lot of roommates, or house poor) which allows them to take a salary that does not support a home and save for retirement.

Nearly A Moose
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Re: Possible career change - move to HCOL area and salary expectations?

Post by Nearly A Moose » Wed Feb 28, 2018 9:49 pm

Keep in mind, it's not just housing costs that are different. Nearly everything is more expensive in a VHCOL city like NYC, both services and goods. I was recently back in a smaller town, bought a round of drinks at a bar for a whole ton of people, and then had to triple check to make sure the bar tab actually included everything it was so low compared to what I'm used to. Point is, you need to see how your lifestyle maps against an expensive city. If you like to each out a lot, for example, that's going to get pricey fast. Not trying to dissuade you, but housing is only part of the issue.
Pardon typos, I'm probably using my fat thumbs on a tiny phone.

Kow
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Re: Possible career change - move to HCOL area and salary expectations?

Post by Kow » Wed Feb 28, 2018 10:07 pm

You likely will not be able to live the same lifestyle. Salaries are not adjusted for the cost of living in the area you move to. Companies will look for the standard pay in the job market which does not keep up with cost of living. I'd expect a 20% increase if it's a similar type company.

The big x factor is the specific competitiveness of your job in that location you are moving to. If the talent pool is tight you will have more opportunities. The other consideration would be the ability to advance your career given there are likely more like opportunities in a close area.

Don't move thinking you will be able to afford a better lifestyle if you are happy in your current job for the long term but if you want advancement it could make sense. It never hurts to test the market and see if something matched your number.

mac808
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Re: Possible career change - move to HCOL area and salary expectations?

Post by mac808 » Wed Feb 28, 2018 10:11 pm

JHU ALmuni wrote:
Tue Feb 27, 2018 6:13 pm
Hi everyone. Need bogleheads wisdom regarding my personal career. Currently I live in Tampa, FL and make 96K a year plus ~8% bonus. I have been with my current employer for about two years and about to start submitting applications for new job due to lack of promotions/future advancement opportunities (plus I feel underpaid) .

I work in finance/compliance and most of the opportunities I looked at are located in NYC. Assuming I apply for roles that are close to my current role. What would be a reasonable expectation regarding salary increase considering cost of living difference between Florida and NYC is huge? I feel if I get 30%, it will barely cover cost of living difference and the extra taxes (no income tax in Florida).

Anyone made similar moves in their career? How did you handle cost of living difference in the process?
30% won't even come close. You'd need >$200k in NYC to match $100k in Tampa. Assuming you enjoy living in Tampa, I would only do it for substantial career advancement, not for the extra $ (which will evaporate).

remomnyc
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Re: Possible career change - move to HCOL area and salary expectations?

Post by remomnyc » Wed Feb 28, 2018 10:39 pm

NYC is a great place to be when you're young and single. My husband wants to move to Tampa, where we determined we could live a nicer lifestyle for 100k than we can for 200k in NYC. I doubt a 30% increase would cover a comparable lifestyle. Move to NYC because you want to be here. I'm sure there are more finance/compliance opportunities here. Since I'm not in that field, I have no idea what the salary range would be for those positions.

Beach
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Re: Possible career change - move to HCOL area and salary expectations?

Post by Beach » Fri Mar 02, 2018 4:22 pm

We moved from Florida a few years ago and can't wait to get back. Moving to such a different climate actually makes quite a difference. We are making 40% more currently than we were and while the additional income is nice, I hate it here. I would gladly give up some of that gain to have better weather.

Just something else to think about before making such a move.

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