HCOL savings rates

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Topic Author
huai
Posts: 47
Joined: Mon Jul 24, 2017 9:11 am

HCOL savings rates

Post by huai » Thu Aug 15, 2019 8:47 pm

Hello bogleheads,

For those of you who live in the SF Bay Area (and didn’t buy your house 10 years or more ago) if you are making high 6 to low 7 figures total comp what amount are you stashing away every year after taxes, housing, tiny lap giraffes, etc?

Huai

Ron Ronnerson
Posts: 1353
Joined: Sat Oct 26, 2013 6:53 pm
Location: Bay Area

Re: HCOL savings rates

Post by Ron Ronnerson » Thu Aug 15, 2019 9:23 pm

I meet most of the criteria you outlined so I’ll respond. I’m a public-school teacher and my wife is a stay-at-home parent in the Bay Area. We bought our home less than 10 years ago. Here are our numbers:

Income: $115k (no health benefits provided by the school district, though)
Taxes: $2k/year for federal income taxes, $0 for California income taxes (despite the common misconception, taxes are progressive here instead of being high)
Housing cost: mortgage for 2150 sq. ft townhouse in a great neighborhood with great schools (4 bedroom/4 bathroom): $1800/month, property taxes: $10k/year (or $840/month), HOA: $290/month
Tiny lap giraffes: $0
Savings: $11k toward pension; $19k into 403b, $19k into 457b, $4k into IRA accounts, $10k toward mortgage principal (which we count as savings since we might sell our Bay Area home and move elsewhere in retirement)
My pension should be approximately $100k/year (in 2019 dollars) around age 60 and cover all our retirement expenses

mervinj7
Posts: 1161
Joined: Thu Mar 27, 2014 3:10 pm

Re: HCOL savings rates

Post by mervinj7 » Thu Aug 15, 2019 9:27 pm

huai wrote:
Thu Aug 15, 2019 8:47 pm
Hello bogleheads,

For those of you who live in the SF Bay Area (and didn’t buy your house 10 years or more ago) if you are making high 6 to low 7 figures total comp what amount are you stashing away every year after taxes, housing, tiny lap giraffes, etc?

Huai
Why don't you start with yours first? :twisted:

User avatar
whodidntante
Posts: 6707
Joined: Thu Jan 21, 2016 11:11 pm
Location: outside the echo chamber

Re: HCOL savings rates

Post by whodidntante » Thu Aug 15, 2019 9:29 pm

Ron Ronnerson wrote:
Thu Aug 15, 2019 9:23 pm
Tiny lap giraffes: $0
Increase.

Litfury
Posts: 34
Joined: Sat Aug 10, 2013 8:43 pm

Re: HCOL savings rates

Post by Litfury » Thu Aug 15, 2019 9:31 pm

Ron Ronnerson wrote:
Thu Aug 15, 2019 9:23 pm
I meet most of the criteria you outlined so I’ll respond. I’m a public-school teacher and my wife is a stay-at-home parent in the Bay Area. We bought our home less than 10 years ago. Here are our numbers:

Income: $115k (no health benefits provided by the school district, though)
Taxes: $2k/year for federal income taxes, $0 for California income taxes (despite the common misconception, taxes are progressive here instead of being high)
Housing cost: mortgage for 2150 sq. ft townhouse in a great neighborhood with great schools (4 bedroom/4 bathroom): $1800/month, property taxes: $10k/year (or $840/month), HOA: $290/month
Tiny lap giraffes: $0
Savings: $11k toward pension; $19k into 403b, $19k into 457b, $4k into IRA accounts, $10k toward mortgage principal (which we count as savings since we might sell our Bay Area home and move elsewhere in retirement)
My pension should be approximately $100k/year (in 2019 dollars) around age 60 and cover all our retirement expenses
Above poster says taxes aren't high in California then pays 840 a month in property taxes...

HawkeyePierce
Posts: 741
Joined: Tue Mar 05, 2019 10:29 pm
Location: Colorado

Re: HCOL savings rates

Post by HawkeyePierce » Thu Aug 15, 2019 9:39 pm

I make mid 6 in Boulder (so HCOL but not VHCOL) and saved 60% of my net in 2018.

stocknoob4111
Posts: 839
Joined: Sun Jan 07, 2018 12:52 pm

Re: HCOL savings rates

Post by stocknoob4111 » Thu Aug 15, 2019 9:41 pm

Ron Ronnerson wrote:
Thu Aug 15, 2019 9:23 pm
Taxes: $2k/year for federal income taxes, $0 for California income taxes (despite the common misconception, taxes are progressive here instead of being high)
you pay $2K a year in Federal income taxes on a $115,000/yr income? So, your effective Federal rate is 1.7% ???

Last year I paid $23,400 in Federal Income taxes on a $124,000 taxable income for an effective rate of 19%. In addition I paid almost $10,000 in CA income taxes!!!

HEDGEFUNDIE
Posts: 3668
Joined: Sun Oct 22, 2017 2:06 pm

Re: HCOL savings rates

Post by HEDGEFUNDIE » Thu Aug 15, 2019 9:45 pm

500k gross
120k to 180k annual savings depending on how many lap🦒 we buy

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willthrill81
Posts: 14008
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Location: USA

Re: HCOL savings rates

Post by willthrill81 » Thu Aug 15, 2019 9:58 pm

Litfury wrote:
Thu Aug 15, 2019 9:31 pm
Ron Ronnerson wrote:
Thu Aug 15, 2019 9:23 pm
I meet most of the criteria you outlined so I’ll respond. I’m a public-school teacher and my wife is a stay-at-home parent in the Bay Area. We bought our home less than 10 years ago. Here are our numbers:

Income: $115k (no health benefits provided by the school district, though)
Taxes: $2k/year for federal income taxes, $0 for California income taxes (despite the common misconception, taxes are progressive here instead of being high)
Housing cost: mortgage for 2150 sq. ft townhouse in a great neighborhood with great schools (4 bedroom/4 bathroom): $1800/month, property taxes: $10k/year (or $840/month), HOA: $290/month
Tiny lap giraffes: $0
Savings: $11k toward pension; $19k into 403b, $19k into 457b, $4k into IRA accounts, $10k toward mortgage principal (which we count as savings since we might sell our Bay Area home and move elsewhere in retirement)
My pension should be approximately $100k/year (in 2019 dollars) around age 60 and cover all our retirement expenses
Above poster says taxes aren't high in California then pays 840 a month in property taxes...
It depends on the market value of the home. We pay about 1.45% annually in a MCOL area. I believe that the rate in San Francisco is 1.163%.
“It's a dangerous business, Frodo, going out your door. You step onto the road, and if you don't keep your feet, there's no knowing where you might be swept off to.” J.R.R. Tolkien,The Lord of the Rings

Topic Author
huai
Posts: 47
Joined: Mon Jul 24, 2017 9:11 am

Re: HCOL savings rates

Post by huai » Thu Aug 15, 2019 10:22 pm

mervinj7 wrote:
Thu Aug 15, 2019 9:27 pm
huai wrote:
Thu Aug 15, 2019 8:47 pm
Hello bogleheads,

For those of you who live in the SF Bay Area (and didn’t buy your house 10 years or more ago) if you are making high 6 to low 7 figures total comp what amount are you stashing away every year after taxes, housing, tiny lap giraffes, etc?

Huai
Why don't you start with yours first? :twisted:
I’m considering a move to this area with a salary increase proportionate to COL increase compared to my LCOL area according to nerd wallets calculator. For round numbers sake let’s say it’s 1.5x my current salary. I am trying to figure if I should expect a proportionate 1.5x increase in my savings amount as well or do the online COL estimates assume static savings but increased costs.

MathIsMyWayr
Posts: 1121
Joined: Mon Mar 27, 2017 10:47 pm
Location: CA

Re: HCOL savings rates

Post by MathIsMyWayr » Thu Aug 15, 2019 10:33 pm

Litfury wrote:
Thu Aug 15, 2019 9:31 pm
Ron Ronnerson wrote:
Thu Aug 15, 2019 9:23 pm
I meet most of the criteria you outlined so I’ll respond. I’m a public-school teacher and my wife is a stay-at-home parent in the Bay Area. We bought our home less than 10 years ago. Here are our numbers:

Income: $115k (no health benefits provided by the school district, though)
Taxes: $2k/year for federal income taxes, $0 for California income taxes (despite the common misconception, taxes are progressive here instead of being high)
Housing cost: mortgage for 2150 sq. ft townhouse in a great neighborhood with great schools (4 bedroom/4 bathroom): $1800/month, property taxes: $10k/year (or $840/month), HOA: $290/month
Tiny lap giraffes: $0
Savings: $11k toward pension; $19k into 403b, $19k into 457b, $4k into IRA accounts, $10k toward mortgage principal (which we count as savings since we might sell our Bay Area home and move elsewhere in retirement)
My pension should be approximately $100k/year (in 2019 dollars) around age 60 and cover all our retirement expenses
Above poster says taxes aren't high in California then pays 840 a month in property taxes...
California property tax rate is not high, but housing is expensive. Proposition 13 sets the statewide property tax rate at 1 percent and an annual increase up to 2 percent maximum. Those who bought houses long time ago enjoy big tax breaks. It is not unusual that one family pays $25k while their neighbor pay $4k for comparable properties. To those retirees, California is not necessarily VHCOL. If OP bought his house for around $820k 10 years ago, he will now pay property tax about $10k. Any way, we are feeling a lot of California tax pain.

Ron Ronnerson
Posts: 1353
Joined: Sat Oct 26, 2013 6:53 pm
Location: Bay Area

Re: HCOL savings rates

Post by Ron Ronnerson » Thu Aug 15, 2019 10:46 pm

whodidntante wrote:
Thu Aug 15, 2019 9:29 pm
Ron Ronnerson wrote:
Thu Aug 15, 2019 9:23 pm
Tiny lap giraffes: $0
Increase.
I really ought to!

mottooscillator
Posts: 45
Joined: Wed Jul 17, 2019 11:14 pm

Re: HCOL savings rates

Post by mottooscillator » Thu Aug 15, 2019 10:50 pm

Household annual income just under $1M. Marginal tax rate is over 50%.

We're saving ~$385,000 so about 38.5% of gross. New job in 2018 so don't know what our net savings will be after taxes, maybe above 50%.

One tiny animal, non giraffe. He costs a bunch but is worth every penny.

Ron Ronnerson
Posts: 1353
Joined: Sat Oct 26, 2013 6:53 pm
Location: Bay Area

Re: HCOL savings rates

Post by Ron Ronnerson » Thu Aug 15, 2019 10:51 pm

Litfury wrote:
Thu Aug 15, 2019 9:31 pm
Ron Ronnerson wrote:
Thu Aug 15, 2019 9:23 pm
I meet most of the criteria you outlined so I’ll respond. I’m a public-school teacher and my wife is a stay-at-home parent in the Bay Area. We bought our home less than 10 years ago. Here are our numbers:

Income: $115k (no health benefits provided by the school district, though)
Taxes: $2k/year for federal income taxes, $0 for California income taxes (despite the common misconception, taxes are progressive here instead of being high)
Housing cost: mortgage for 2150 sq. ft townhouse in a great neighborhood with great schools (4 bedroom/4 bathroom): $1800/month, property taxes: $10k/year (or $840/month), HOA: $290/month
Tiny lap giraffes: $0
Savings: $11k toward pension; $19k into 403b, $19k into 457b, $4k into IRA accounts, $10k toward mortgage principal (which we count as savings since we might sell our Bay Area home and move elsewhere in retirement)
My pension should be approximately $100k/year (in 2019 dollars) around age 60 and cover all our retirement expenses
Above poster says taxes aren't high in California then pays 840 a month in property taxes...
The context is important to keep in mind too. The property tax rate of $840/month is around 1.2% of the home value in a location where a public school teacher earns $115k/year (mid-career). Also, due to Prop 13, the tax doesn't change much from year-to-year.

ScroogeMcDuck
Posts: 61
Joined: Thu Jan 22, 2015 4:25 pm

Re: HCOL savings rates

Post by ScroogeMcDuck » Thu Aug 15, 2019 11:01 pm

We're DINKs in San Francisco, bought our home 6 years ago.

$310k gross (excluding investment income)
$50k Fed tax
$20k state tax
$7k property tax
$200k savings (excluding employer 401k match and stock options)

Ron Ronnerson
Posts: 1353
Joined: Sat Oct 26, 2013 6:53 pm
Location: Bay Area

Re: HCOL savings rates

Post by Ron Ronnerson » Thu Aug 15, 2019 11:09 pm

stocknoob4111 wrote:
Thu Aug 15, 2019 9:41 pm
Ron Ronnerson wrote:
Thu Aug 15, 2019 9:23 pm
Taxes: $2k/year for federal income taxes, $0 for California income taxes (despite the common misconception, taxes are progressive here instead of being high)
you pay $2K a year in Federal income taxes on a $115,000/yr income? So, your effective Federal rate is 1.7% ???

Last year I paid $23,400 in Federal Income taxes on a $124,000 taxable income for an effective rate of 19%. In addition I paid almost $10,000 in CA income taxes!!!
Here are some more specifics:
FEDERAL:
Income is $115k
Above-line Deductions are $56k (10.25% of salary toward pension contributions, max 403b, max 457b, dental premiums taken from paycheck, health FSA, traditional IRA*)
AGI: ~$59k
Standard Deduction: $24k
Taxable Income: ~35k
Tax before credits: ~3900
Child Tax Credit (1 kid) and Saver's Credit: $2400
Taxes Owed: ~1500

CALIFORNIA:
AGI: ~$59k
Itemized Deductions: $21.5k ($10k in property taxes and $11.5k in mortgage interest)
Taxable Income: ~$37.5k
Tax before exemptions: $600
Exemptions for 2 adults and 1 child: $600
Taxes Owed: ~0

*We contribute toward a traditional IRA instead of a Roth despite our low tax bracket in order to qualify for premium tax credit on the health insurance exchange.

stocknoob4111
Posts: 839
Joined: Sun Jan 07, 2018 12:52 pm

Re: HCOL savings rates

Post by stocknoob4111 » Thu Aug 15, 2019 11:57 pm

oh ok, you're married, kids, house, those are big deductions.. I have none of that and not interested in any of that as well :D

Here are my # anyway -
$156K gross - $148K W2 income, $8K investment income, ~$24k Federal, ~$10k CA state

My employer pays my health insurance 100% so I don't pay anything for that.

Savings Total $67,500 : 401k Max $22k (incl. match), HSA Max $3.5k, Backdoor Roth Max - $6k, Taxable - $36k

Edit - I don't live in SF, rather in SoCal but your thread said HCOL area :D

Just a note though - this is an investment forum so you're going to get a disproportionate number of very high savers here, probably not reflective of the population at large.

hmw
Posts: 638
Joined: Sun Mar 02, 2014 11:44 am

Re: HCOL savings rates

Post by hmw » Fri Aug 16, 2019 12:12 am

ScroogeMcDuck wrote:
Thu Aug 15, 2019 11:01 pm
We're DINKs in San Francisco, bought our home 6 years ago.

$310k gross (excluding investment income)
$50k Fed tax
$20k state tax
$7k property tax
$200k savings (excluding employer 401k match and stock options)

You only spend 33k a year for 2 people? :shock:

MathIsMyWayr
Posts: 1121
Joined: Mon Mar 27, 2017 10:47 pm
Location: CA

Re: HCOL savings rates

Post by MathIsMyWayr » Fri Aug 16, 2019 2:08 am

hmw wrote:
Fri Aug 16, 2019 12:12 am
ScroogeMcDuck wrote:
Thu Aug 15, 2019 11:01 pm
We're DINKs in San Francisco, bought our home 6 years ago.

$310k gross (excluding investment income)
$50k Fed tax
$20k state tax
$7k property tax
$200k savings (excluding employer 401k match and stock options)

You only spend 33k a year for 2 people? :shock:
$2,750/month - I am always amazed how little some people spend unless they are laser-focused on savings in a survival mind set. I am frugal, but want to have life both now and in the furture.
  • mortgage
    home insurance
    auto insurance
    gas
    auto expense
    parking/toll + parking tickets in SF :x
    phone
    gas/electricity
    water/sewer
    trash
    internet
    phone/tv
    grocery
    clothes
    medical/healthcare expense
    misc. purchase
    lunch
    restaurant
    travel/vacation
    hobbies and entertainment
    donations
    .
    .
    .

ScroogeMcDuck
Posts: 61
Joined: Thu Jan 22, 2015 4:25 pm

Re: HCOL savings rates

Post by ScroogeMcDuck » Fri Aug 16, 2019 7:43 am

MathIsMyWayr wrote:
Fri Aug 16, 2019 2:08 am
hmw wrote:
Fri Aug 16, 2019 12:12 am
ScroogeMcDuck wrote:
Thu Aug 15, 2019 11:01 pm
We're DINKs in San Francisco, bought our home 6 years ago.

$310k gross (excluding investment income)
$50k Fed tax
$20k state tax
$7k property tax
$200k savings (excluding employer 401k match and stock options)

You only spend 33k a year for 2 people? :shock:
$2,750/month - I am always amazed how little some people spend unless they are laser-focused on savings in a survival mind set. I am frugal, but want to have life both now and in the furture.
  • mortgage
    home insurance
    auto insurance
    gas
    auto expense
    parking/toll + parking tickets in SF :x
    phone
    gas/electricity
    water/sewer
    trash
    internet
    phone/tv
    grocery
    clothes
    medical/healthcare expense
    misc. purchase
    lunch
    restaurant
    travel/vacation
    hobbies and entertainment
    donations
    .
    .
    .
We spend whatever we want but things we enjoy just don't cost very much. We also don't spend on things we don't care about and don't use shopping as entertainment. (A lot of older relatives seem to do that.) Here's last year's breakdown.

mortgage - none; property tax is $7k on a home worth ~$1.2 million
home insurance - $1,600
auto insurance, gas, repairs, parking, tolls - $1,700 (SF is a wonderful walking city and tech shuttles cover commute)
phone, utilities, trash, internet - $2,600 (mild climate)
grocery - $3,500 (work covers weekday lunch and we like to cook from scratch as it's healthier)
clothes - $500
medical - $3,500
misc. purchase - $1,000
restaurant - $3,500 (this is a hobby, we try to go someplace new every week)
travel - $8,000 (37 nights; we also use points)
hobbies - $700 (we love hiking, swimming, running)
donations/gifts - $5,000
investing fees - $840 :D

willyt25
Posts: 8
Joined: Sat Aug 29, 2015 11:06 am

Re: HCOL savings rates

Post by willyt25 » Fri Aug 16, 2019 7:48 am

My question involves lap giraffes. Should I increase investments in these even if there is a Giraffe Inversion happening currently in the broader US market? Would it be market timing? My EJ adviser wants to charge me a 5% front end load on the purchase of all Lap Giraffes and is also saying that I should purchase whole life policies for all of the lap giraffes.

Grt2bOutdoors
Posts: 21496
Joined: Thu Apr 05, 2007 8:20 pm
Location: New York

Re: HCOL savings rates

Post by Grt2bOutdoors » Fri Aug 16, 2019 7:55 am

stocknoob4111 wrote:
Thu Aug 15, 2019 9:41 pm
Ron Ronnerson wrote:
Thu Aug 15, 2019 9:23 pm
Taxes: $2k/year for federal income taxes, $0 for California income taxes (despite the common misconception, taxes are progressive here instead of being high)
you pay $2K a year in Federal income taxes on a $115,000/yr income? So, your effective Federal rate is 1.7% ???

Last year I paid $23,400 in Federal Income taxes on a $124,000 taxable income for an effective rate of 19%. In addition I paid almost $10,000 in CA income taxes!!!
That’s because he is deferring $59k in retirement contributions. If your employer offered such plans - pension, 403b, 457 then you’d have no issue in paying less tax too. Essentially he has disposable income of $50k+.
"One should invest based on their need, ability and willingness to take risk - Larry Swedroe" Asking Portfolio Questions

Ron Ronnerson
Posts: 1353
Joined: Sat Oct 26, 2013 6:53 pm
Location: Bay Area

Re: HCOL savings rates

Post by Ron Ronnerson » Fri Aug 16, 2019 9:34 am

Grt2bOutdoors wrote:
Fri Aug 16, 2019 7:55 am
stocknoob4111 wrote:
Thu Aug 15, 2019 9:41 pm
Ron Ronnerson wrote:
Thu Aug 15, 2019 9:23 pm
Taxes: $2k/year for federal income taxes, $0 for California income taxes (despite the common misconception, taxes are progressive here instead of being high)
you pay $2K a year in Federal income taxes on a $115,000/yr income? So, your effective Federal rate is 1.7% ???

Last year I paid $23,400 in Federal Income taxes on a $124,000 taxable income for an effective rate of 19%. In addition I paid almost $10,000 in CA income taxes!!!
That’s because he is deferring $59k in retirement contributions. If your employer offered such plans - pension, 403b, 457 then you’d have no issue in paying less tax too. Essentially he has disposable income of $50k+.
Yes, I have the option to defer a lot of my income and that helps us greatly in keeping tax lows. It's actually really beneficial because in addition to lowering the marginal tax rate, it helps us qualify for tax credits too - such as the premium tax credit and Saver's Credit. These credits are worth around $15k/year for us.

Our expenses (including all taxes) are around $70k/year. After putting money into tax-deferred accounts, we end up with around $60k left to cover those expenses. To make up the difference, we get a little bit of money from sources that aren’t taxed. This includes churning credit cards for bonuses, getting gifts (as a teacher and also from our own family), and selling household items. The goal is to keep our AGI around $60k because then we qualify for subsidized health insurance for the entire family. Otherwise, we don't. So instead of buying insurance through my employer at a cost of $24k/year, I get it on the exchange. It costs $15k/year for our family of three, with our share at $2k/year.

Admiral
Posts: 2488
Joined: Mon Oct 27, 2014 12:35 pm

Re: HCOL savings rates

Post by Admiral » Fri Aug 16, 2019 9:44 am

huai wrote:
Thu Aug 15, 2019 8:47 pm
Hello bogleheads,

For those of you who live in the SF Bay Area (and didn’t buy your house 10 years or more ago) if you are making high 6 to low 7 figures total comp what amount are you stashing away every year after taxes, housing, tiny lap giraffes, etc?

Huai
I don't see how anyone making a million dollars a year could or should save less than six figures. Even with high housing costs. If that's how much you will make, that should be your baseline. You could spend $10k a month on housing and on that salary you'd still have plenty leftover.

Heck we make way less than $500k, have two kids BOTH in private school and last year we saved $50k, which doesn't include required pension savings or home equity.

Thegame14
Posts: 1298
Joined: Mon May 07, 2018 11:53 am

Re: HCOL savings rates

Post by Thegame14 » Fri Aug 16, 2019 11:54 am

Litfury wrote:
Thu Aug 15, 2019 9:31 pm
Ron Ronnerson wrote:
Thu Aug 15, 2019 9:23 pm
I meet most of the criteria you outlined so I’ll respond. I’m a public-school teacher and my wife is a stay-at-home parent in the Bay Area. We bought our home less than 10 years ago. Here are our numbers:

Income: $115k (no health benefits provided by the school district, though)
Taxes: $2k/year for federal income taxes, $0 for California income taxes (despite the common misconception, taxes are progressive here instead of being high)
Housing cost: mortgage for 2150 sq. ft townhouse in a great neighborhood with great schools (4 bedroom/4 bathroom): $1800/month, property taxes: $10k/year (or $840/month), HOA: $290/month
Tiny lap giraffes: $0
Savings: $11k toward pension; $19k into 403b, $19k into 457b, $4k into IRA accounts, $10k toward mortgage principal (which we count as savings since we might sell our Bay Area home and move elsewhere in retirement)
My pension should be approximately $100k/year (in 2019 dollars) around age 60 and cover all our retirement expenses
Above poster says taxes aren't high in California then pays 840 a month in property taxes...
Id trade, house worth $475K in NJ and prop taxes are over $12K a year for a less than 2,000 sq ft home

Traveler
Posts: 809
Joined: Fri Aug 30, 2013 9:07 pm

Re: HCOL savings rates

Post by Traveler » Fri Aug 16, 2019 6:01 pm

ScroogeMcDuck wrote:
Fri Aug 16, 2019 7:43 am
MathIsMyWayr wrote:
Fri Aug 16, 2019 2:08 am
hmw wrote:
Fri Aug 16, 2019 12:12 am
ScroogeMcDuck wrote:
Thu Aug 15, 2019 11:01 pm
We're DINKs in San Francisco, bought our home 6 years ago.

$310k gross (excluding investment income)
$50k Fed tax
$20k state tax
$7k property tax
$200k savings (excluding employer 401k match and stock options)

You only spend 33k a year for 2 people? :shock:
$2,750/month - I am always amazed how little some people spend unless they are laser-focused on savings in a survival mind set. I am frugal, but want to have life both now and in the furture.
  • mortgage
    home insurance
    auto insurance
    gas
    auto expense
    parking/toll + parking tickets in SF :x
    phone
    gas/electricity
    water/sewer
    trash
    internet
    phone/tv
    grocery
    clothes
    medical/healthcare expense
    misc. purchase
    lunch
    restaurant
    travel/vacation
    hobbies and entertainment
    donations
    .
    .
    .
We spend whatever we want but things we enjoy just don't cost very much. We also don't spend on things we don't care about and don't use shopping as entertainment. (A lot of older relatives seem to do that.) Here's last year's breakdown.

mortgage - none; property tax is $7k on a home worth ~$1.2 million
home insurance - $1,600
auto insurance, gas, repairs, parking, tolls - $1,700 (SF is a wonderful walking city and tech shuttles cover commute)
phone, utilities, trash, internet - $2,600 (mild climate)
grocery - $3,500 (work covers weekday lunch and we like to cook from scratch as it's healthier)
clothes - $500
medical - $3,500
misc. purchase - $1,000
restaurant - $3,500 (this is a hobby, we try to go someplace new every week)
travel - $8,000 (37 nights; we also use points)
hobbies - $700 (we love hiking, swimming, running)
donations/gifts - $5,000
investing fees - $840 :D
So you bought a house 6 years ago that is worth $1.2M today. Your property taxes are only $7K (how are they so low when the basis would have reset only six years ago?) and you have no mortgage. Hmmmmm

ScroogeMcDuck
Posts: 61
Joined: Thu Jan 22, 2015 4:25 pm

Re: HCOL savings rates

Post by ScroogeMcDuck » Fri Aug 16, 2019 7:38 pm

Traveler wrote:
Fri Aug 16, 2019 6:01 pm
ScroogeMcDuck wrote:
Fri Aug 16, 2019 7:43 am
MathIsMyWayr wrote:
Fri Aug 16, 2019 2:08 am
hmw wrote:
Fri Aug 16, 2019 12:12 am
ScroogeMcDuck wrote:
Thu Aug 15, 2019 11:01 pm
We're DINKs in San Francisco, bought our home 6 years ago.

$310k gross (excluding investment income)
$50k Fed tax
$20k state tax
$7k property tax
$200k savings (excluding employer 401k match and stock options)

You only spend 33k a year for 2 people? :shock:
$2,750/month - I am always amazed how little some people spend unless they are laser-focused on savings in a survival mind set. I am frugal, but want to have life both now and in the furture.
  • mortgage
    home insurance
    auto insurance
    gas
    auto expense
    parking/toll + parking tickets in SF :x
    phone
    gas/electricity
    water/sewer
    trash
    internet
    phone/tv
    grocery
    clothes
    medical/healthcare expense
    misc. purchase
    lunch
    restaurant
    travel/vacation
    hobbies and entertainment
    donations
    .
    .
    .
We spend whatever we want but things we enjoy just don't cost very much. We also don't spend on things we don't care about and don't use shopping as entertainment. (A lot of older relatives seem to do that.) Here's last year's breakdown.

mortgage - none; property tax is $7k on a home worth ~$1.2 million
home insurance - $1,600
auto insurance, gas, repairs, parking, tolls - $1,700 (SF is a wonderful walking city and tech shuttles cover commute)
phone, utilities, trash, internet - $2,600 (mild climate)
grocery - $3,500 (work covers weekday lunch and we like to cook from scratch as it's healthier)
clothes - $500
medical - $3,500
misc. purchase - $1,000
restaurant - $3,500 (this is a hobby, we try to go someplace new every week)
travel - $8,000 (37 nights; we also use points)
hobbies - $700 (we love hiking, swimming, running)
donations/gifts - $5,000
investing fees - $840 :D
So you bought a house 6 years ago that is worth $1.2M today. Your property taxes are only $7K (how are they so low when the basis would have reset only six years ago?) and you have no mortgage. Hmmmmm
We spent less than $600k originally, made improvements and it doubled in value. The original price was a very good deal in retrospect.

<$300k mortgage is very easy to pay off when you save >$150k per year.

DH0
Posts: 33
Joined: Thu Jan 11, 2018 3:00 pm

Re: HCOL savings rates

Post by DH0 » Fri Aug 16, 2019 8:52 pm

[/quote]

So you bought a house 6 years ago that is worth $1.2M today. Your property taxes are only $7K (how are they so low when the basis would have reset only six years ago?) and you have no mortgage. Hmmmmm
[/quote]

Not that unusual in the Bay Area. We bought a place for a little over $200k in 2011 that is currently worth in the low $800s. Was worth 10% more last year. Property taxes are under $3k/yr because of prop 13.

desafinado
Posts: 158
Joined: Wed Dec 28, 2016 3:14 am

Re: HCOL savings rates

Post by desafinado » Fri Aug 16, 2019 9:03 pm

I don't think it's wrong to call it 33k of spend but it's more like 80 or 90k of consumption given imputed rent. Kudos nonetheless!

decapod10
Posts: 403
Joined: Thu Dec 28, 2017 6:46 pm

Re: HCOL savings rates

Post by decapod10 » Fri Aug 16, 2019 9:25 pm

Traveler wrote:
Fri Aug 16, 2019 6:01 pm


So you bought a house 6 years ago that is worth $1.2M today. Your property taxes are only $7K (how are they so low when the basis would have reset only six years ago?) and you have no mortgage. Hmmmmm
Possible if the house was South Bay/Peninsula, doubling in 6 years is within the realm of possibility, though definitely on the more aggressive/lucky side. Doubling in value since 8 years ago anywhere in the South Bay / Peninsula in any sort of reasonable neighborhood is a near certainty.

decapod10
Posts: 403
Joined: Thu Dec 28, 2017 6:46 pm

Re: HCOL savings rates

Post by decapod10 » Fri Aug 16, 2019 10:11 pm

huai wrote:
Thu Aug 15, 2019 10:22 pm
mervinj7 wrote:
Thu Aug 15, 2019 9:27 pm
huai wrote:
Thu Aug 15, 2019 8:47 pm
Hello bogleheads,

For those of you who live in the SF Bay Area (and didn’t buy your house 10 years or more ago) if you are making high 6 to low 7 figures total comp what amount are you stashing away every year after taxes, housing, tiny lap giraffes, etc?

Huai
Why don't you start with yours first? :twisted:
I’m considering a move to this area with a salary increase proportionate to COL increase compared to my LCOL area according to nerd wallets calculator. For round numbers sake let’s say it’s 1.5x my current salary. I am trying to figure if I should expect a proportionate 1.5x increase in my savings amount as well or do the online COL estimates assume static savings but increased costs.
You should be able to model your expenses with reasonable accuracy, especially if you don't have kids. I would consider the following factors in roughly order of importance:

1. Housing - this is by far the most important expense and difficult to control. Look at the area you are going to live and figure out the mortgage/rent you will need to pay. This will probably give you 90% of what you need to know in terms of budget. Property taxes are typically 1-1.5% per year depending on where you live.
2. Taxes - You should be able to model your taxes relatively easily by looking up the state tax brackets.
3. Gas/Transportation - Gas is quite expensive in the Bay Area $3.50-$4 per gallon. Parking is expensive. There may be taxis/uber involved too depending on where you are living exactly.
4. Restaurants - Eating out is quite expensive here, but fortunately it's a controllable cost. Groceries are more expensive too but not to the degree that dining out is. If you mostly eat at home, food shouldn't be a huge increase in expense

I think if you hold your other expenses the same or maybe add 10%, then make adjustments as above, you'll have a pretty good idea of what your expenses will be and therefore your savings rate.

If you have kids, then childcare is a huge expense. Activities can also be quite expensive.

sf_tech_saver
Posts: 215
Joined: Sat Sep 08, 2018 9:03 pm

Re: HCOL savings rates

Post by sf_tech_saver » Sat Aug 17, 2019 12:55 pm

huai wrote:
Thu Aug 15, 2019 8:47 pm
Hello bogleheads,

For those of you who live in the SF Bay Area (and didn’t buy your house 10 years or more ago) if you are making high 6 to low 7 figures total comp what amount are you stashing away every year after taxes, housing, tiny lap giraffes, etc?

Huai
My simple approach is to live off our base pay as much as possible. We use our bonus pay for one time purchases (cars, sometimes big vacations) and save the rest. 100% of equity compensation goes to our portfolio. I literally sell all equity the day it vests and buy VTI/VTEB. This model is easy to live with now that we've used a one-time IPO liquidity event to buy a house except for the tax-deductible mortgage.

We use my wife's base to pay for nanny and eventually private school for our son. That's about $40k a year....forever. At least we won't be shocked on college costs as we essentially have to send him to a private university forever :)

I'm sure many bogleheads would find just the base pay spending a bit much but the equity upside compensation has been big enough to allow us to focus our savings rate there.

Round numbers are:

Him (41): $300k base, $250k Bonus, $500k equity yearly
Her (36): $175k base, $30k bonus, $30k equity

Our current portfolio (not including home equity) is about $3.2M, net worth about $4.6M. On this base, I feel comfortable that adding an additional 300-400K a year after tax in savings will put us in a good place in a decade. I also expect her salary/comp to increase.

Before the IPO I did try to save more towards a home down payment but now that we are over that lump it is obviously easier to spend our base pay freely. I enjoy my job and plan on working till I'm at least 50+.
VTI is a modern marvel

Starfish
Posts: 1461
Joined: Wed Aug 15, 2018 6:33 pm

Re: HCOL savings rates

Post by Starfish » Sat Aug 17, 2019 3:02 pm

ScroogeMcDuck wrote:
Fri Aug 16, 2019 7:43 am
MathIsMyWayr wrote:
Fri Aug 16, 2019 2:08 am
hmw wrote:
Fri Aug 16, 2019 12:12 am
ScroogeMcDuck wrote:
Thu Aug 15, 2019 11:01 pm
We're DINKs in San Francisco, bought our home 6 years ago.

$310k gross (excluding investment income)
$50k Fed tax
$20k state tax
$7k property tax
$200k savings (excluding employer 401k match and stock options)

You only spend 33k a year for 2 people? :shock:
$2,750/month - I am always amazed how little some people spend unless they are laser-focused on savings in a survival mind set. I am frugal, but want to have life both now and in the furture.
  • mortgage
    home insurance
    auto insurance
    gas
    auto expense
    parking/toll + parking tickets in SF :x
    phone
    gas/electricity
    water/sewer
    trash
    internet
    phone/tv
    grocery
    clothes
    medical/healthcare expense
    misc. purchase
    lunch
    restaurant
    travel/vacation
    hobbies and entertainment
    donations
    .
    .
    .
We spend whatever we want but things we enjoy just don't cost very much. We also don't spend on things we don't care about and don't use shopping as entertainment. (A lot of older relatives seem to do that.) Here's last year's breakdown.

mortgage - none; property tax is $7k on a home worth ~$1.2 million
home insurance - $1,600
auto insurance, gas, repairs, parking, tolls - $1,700 (SF is a wonderful walking city and tech shuttles cover commute)
phone, utilities, trash, internet - $2,600 (mild climate)
grocery - $3,500 (work covers weekday lunch and we like to cook from scratch as it's healthier)
clothes - $500
medical - $3,500
misc. purchase - $1,000
restaurant - $3,500 (this is a hobby, we try to go someplace new every week)
travel - $8,000 (37 nights; we also use points)
hobbies - $700 (we love hiking, swimming, running)
donations/gifts - $5,000
investing fees - $840 :D
Some of these numbers don't make any sense to me. They are possible, just hard to achieve.
For example the property tax: I also bought a house 6 years ago, in bay area, but it is worth now under 1 million and my property tax is higher than that. Maybe appreciation rate in that particular neighborhood was exceptional?

Anyway this illustrates why these topic is no use for anybody: you get all the extremes. You get people who live with very little money and people who spend them all. With million income you can rent a 2bdr apartment or you can buy a 5 million $ house, you can send your kids to public school or to Harker for 50k a yer per kid, you can drive a civic or a ferrari.

MathIsMyWayr
Posts: 1121
Joined: Mon Mar 27, 2017 10:47 pm
Location: CA

Re: HCOL savings rates

Post by MathIsMyWayr » Sat Aug 17, 2019 3:06 pm

ScroogeMcDuck wrote:
Fri Aug 16, 2019 7:43 am
We spend whatever we want but things we enjoy just don't cost very much. We also don't spend on things we don't care about and don't use shopping as entertainment. (A lot of older relatives seem to do that.) Here's last year's breakdown.

mortgage - none; property tax is $7k on a home worth ~$1.2 million
home insurance - $1,600
auto insurance, gas, repairs, parking, tolls - $1,700 (SF is a wonderful walking city and tech shuttles cover commute)
phone, utilities, trash, internet - $2,600 (mild climate)
grocery - $3,500 (work covers weekday lunch and we like to cook from scratch as it's healthier)
clothes - $500
medical - $3,500
misc. purchase - $1,000
restaurant - $3,500 (this is a hobby, we try to go someplace new every week)
travel - $8,000 (37 nights; we also use points)
hobbies - $700 (we love hiking, swimming, running)
donations/gifts - $5,000
investing fees - $840 :D
You are able to live comfortably on $33k per year thanks to no mortgage. A mortgage easily tops that amount in this area. If I try to be nitpicky, I would add about $10k annually for the future expenses such as replacement of autos, home appliances and home repair and maintenance. Still it comes out under $50k - excellent. Social security may easily cover them all with a decent lifetime earnings history.

Topic Author
huai
Posts: 47
Joined: Mon Jul 24, 2017 9:11 am

Re: HCOL savings rates

Post by huai » Mon Aug 19, 2019 6:57 am

Starfish wrote:
Sat Aug 17, 2019 3:02 pm
ScroogeMcDuck wrote:
Fri Aug 16, 2019 7:43 am
MathIsMyWayr wrote:
Fri Aug 16, 2019 2:08 am
hmw wrote:
Fri Aug 16, 2019 12:12 am
ScroogeMcDuck wrote:
Thu Aug 15, 2019 11:01 pm
We're DINKs in San Francisco, bought our home 6 years ago.

$310k gross (excluding investment income)
$50k Fed tax
$20k state tax
$7k property tax
$200k savings (excluding employer 401k match and stock options)

You only spend 33k a year for 2 people? :shock:
$2,750/month - I am always amazed how little some people spend unless they are laser-focused on savings in a survival mind set. I am frugal, but want to have life both now and in the furture.
  • mortgage
    home insurance
    auto insurance
    gas
    auto expense
    parking/toll + parking tickets in SF :x
    phone
    gas/electricity
    water/sewer
    trash
    internet
    phone/tv
    grocery
    clothes
    medical/healthcare expense
    misc. purchase
    lunch
    restaurant
    travel/vacation
    hobbies and entertainment
    donations
    .
    .
    .
We spend whatever we want but things we enjoy just don't cost very much. We also don't spend on things we don't care about and don't use shopping as entertainment. (A lot of older relatives seem to do that.) Here's last year's breakdown.

mortgage - none; property tax is $7k on a home worth ~$1.2 million
home insurance - $1,600
auto insurance, gas, repairs, parking, tolls - $1,700 (SF is a wonderful walking city and tech shuttles cover commute)
phone, utilities, trash, internet - $2,600 (mild climate)
grocery - $3,500 (work covers weekday lunch and we like to cook from scratch as it's healthier)
clothes - $500
medical - $3,500
misc. purchase - $1,000
restaurant - $3,500 (this is a hobby, we try to go someplace new every week)
travel - $8,000 (37 nights; we also use points)
hobbies - $700 (we love hiking, swimming, running)
donations/gifts - $5,000
investing fees - $840 :D
Some of these numbers don't make any sense to me. They are possible, just hard to achieve.
For example the property tax: I also bought a house 6 years ago, in bay area, but it is worth now under 1 million and my property tax is higher than that. Maybe appreciation rate in that particular neighborhood was exceptional?

Anyway this illustrates why these topic is no use for anybody: you get all the extremes. You get people who live with very little money and people who spend them all. With million income you can rent a 2bdr apartment or you can buy a 5 million $ house, you can send your kids to public school or to Harker for 50k a yer per kid, you can drive a civic or a ferrari.
Well that poster’s income is way south of the target range I was looking at, but the few who have posted have been extremely helpful

Miguelito
Posts: 283
Joined: Thu Feb 27, 2014 1:21 pm

Re: HCOL savings rates

Post by Miguelito » Mon Aug 19, 2019 7:20 am

Not in CA, but curious as to what you mean by savings. All funds added to retirement/taxable investment/cash accounts? Do you also include principal, 529's, HSA's, and other?

jharkin
Posts: 2368
Joined: Mon Mar 28, 2016 7:14 am
Location: Boston suburbs

Re: HCOL savings rates

Post by jharkin » Mon Aug 19, 2019 7:30 am

Starfish wrote:
Sat Aug 17, 2019 3:02 pm
ScroogeMcDuck wrote:
Fri Aug 16, 2019 7:43 am

We spend whatever we want but things we enjoy just don't cost very much. We also don't spend on things we don't care about and don't use shopping as entertainment. (A lot of older relatives seem to do that.) Here's last year's breakdown.

mortgage - none; property tax is $7k on a home worth ~$1.2 million
home insurance - $1,600
auto insurance, gas, repairs, parking, tolls - $1,700 (SF is a wonderful walking city and tech shuttles cover commute)
phone, utilities, trash, internet - $2,600 (mild climate)
grocery - $3,500 (work covers weekday lunch and we like to cook from scratch as it's healthier)
clothes - $500
medical - $3,500
misc. purchase - $1,000
restaurant - $3,500 (this is a hobby, we try to go someplace new every week)
travel - $8,000 (37 nights; we also use points)
hobbies - $700 (we love hiking, swimming, running)
donations/gifts - $5,000
investing fees - $840 :D
Some of these numbers don't make any sense to me. They are possible, just hard to achieve.
For example the property tax: I also bought a house 6 years ago, in bay area, but it is worth now under 1 million and my property tax is higher than that. Maybe appreciation rate in that particular neighborhood was exceptional?

Anyway this illustrates why these topic is no use for anybody: you get all the extremes. You get people who live with very little money and people who spend them all. With million income you can rent a 2bdr apartment or you can buy a 5 million $ house, you can send your kids to public school or to Harker for 50k a yer per kid, you can drive a civic or a ferrari.
Every spending thread on this board is like that. You have people who earn a million and then tell the rest of us that we should only drive a 20 year old used corolla if we are not worth a million... and then you have the people who humblebrag about deciding between a Prosche Panamera and a Ferrari America.

And agreed that those numbers are MMM low. $3500 a year for going out to eat weekly? In San Fransisco?? Thats under $70 a meal... over the weekend we road tripped and stopped for sandwiches and coffee on the side of the road in **Maine** and spent over $40... In the Boston suburbs just 2 drinks per person + tax and tip nearly blows that meal budget before you even buy food. Downtown Boston is worse, let alone Manhattan or SF.

mmmodem
Posts: 1814
Joined: Thu May 20, 2010 1:22 pm

Re: HCOL savings rates

Post by mmmodem » Mon Aug 19, 2019 7:58 am

Bought home in SF Bay Area 7 years ago.
Family of 5
Household income: ~$150k
401k + Roth IRA + HSA: ~$27k
We only save in tax advantaged accounts.

We moved out of the HCOLA a little over a year ago to LCOLA.
Household income dropped to ~$120k
401k+ Roth IRA + HSA = ~$37k

mervinj7
Posts: 1161
Joined: Thu Mar 27, 2014 3:10 pm

Re: HCOL savings rates

Post by mervinj7 » Mon Aug 19, 2019 10:59 am

mmmodem wrote:
Mon Aug 19, 2019 7:58 am
Bought home in SF Bay Area 7 years ago.
Family of 5
Household income: ~$150k
401k + Roth IRA + HSA: ~$27k
We only save in tax advantaged accounts.

We moved out of the HCOLA a little over a year ago to LCOLA.
Household income dropped to ~$120k
401k+ Roth IRA + HSA = ~$37k
Did you sell your home when you left? If so, that's a sizable increase in your net worth.

Starfish
Posts: 1461
Joined: Wed Aug 15, 2018 6:33 pm

Re: HCOL savings rates

Post by Starfish » Mon Aug 19, 2019 12:00 pm

jharkin wrote:
Mon Aug 19, 2019 7:30 am
Starfish wrote:
Sat Aug 17, 2019 3:02 pm
ScroogeMcDuck wrote:
Fri Aug 16, 2019 7:43 am

We spend whatever we want but things we enjoy just don't cost very much. We also don't spend on things we don't care about and don't use shopping as entertainment. (A lot of older relatives seem to do that.) Here's last year's breakdown.

mortgage - none; property tax is $7k on a home worth ~$1.2 million
home insurance - $1,600
auto insurance, gas, repairs, parking, tolls - $1,700 (SF is a wonderful walking city and tech shuttles cover commute)
phone, utilities, trash, internet - $2,600 (mild climate)
grocery - $3,500 (work covers weekday lunch and we like to cook from scratch as it's healthier)
clothes - $500
medical - $3,500
misc. purchase - $1,000
restaurant - $3,500 (this is a hobby, we try to go someplace new every week)
travel - $8,000 (37 nights; we also use points)
hobbies - $700 (we love hiking, swimming, running)
donations/gifts - $5,000
investing fees - $840 :D
Some of these numbers don't make any sense to me. They are possible, just hard to achieve.
For example the property tax: I also bought a house 6 years ago, in bay area, but it is worth now under 1 million and my property tax is higher than that. Maybe appreciation rate in that particular neighborhood was exceptional?

Anyway this illustrates why these topic is no use for anybody: you get all the extremes. You get people who live with very little money and people who spend them all. With million income you can rent a 2bdr apartment or you can buy a 5 million $ house, you can send your kids to public school or to Harker for 50k a yer per kid, you can drive a civic or a ferrari.
Every spending thread on this board is like that. You have people who earn a million and then tell the rest of us that we should only drive a 20 year old used corolla if we are not worth a million... and then you have the people who humblebrag about deciding between a Prosche Panamera and a Ferrari America.

And agreed that those numbers are MMM low. $3500 a year for going out to eat weekly? In San Fransisco?? Thats under $70 a meal... over the weekend we road tripped and stopped for sandwiches and coffee on the side of the road in **Maine** and spent over $40... In the Boston suburbs just 2 drinks per person + tax and tip nearly blows that meal budget before you even buy food. Downtown Boston is worse, let alone Manhattan or SF.
70$ per meal is nothing extreme, it's normal. We spend abut the same, even with some alcohol and a kid.
Yes, there plenty of places where you can spend double or 10X that (or more). But there are also plenty of very good places in that price range.
MathIsMyWayr wrote:
Sat Aug 17, 2019 3:06 pm
ScroogeMcDuck wrote:
Fri Aug 16, 2019 7:43 am
We spend whatever we want but things we enjoy just don't cost very much. We also don't spend on things we don't care about and don't use shopping as entertainment. (A lot of older relatives seem to do that.) Here's last year's breakdown.

mortgage - none; property tax is $7k on a home worth ~$1.2 million
home insurance - $1,600
auto insurance, gas, repairs, parking, tolls - $1,700 (SF is a wonderful walking city and tech shuttles cover commute)
phone, utilities, trash, internet - $2,600 (mild climate)
grocery - $3,500 (work covers weekday lunch and we like to cook from scratch as it's healthier)
clothes - $500
medical - $3,500
misc. purchase - $1,000
restaurant - $3,500 (this is a hobby, we try to go someplace new every week)
travel - $8,000 (37 nights; we also use points)
hobbies - $700 (we love hiking, swimming, running)
donations/gifts - $5,000
investing fees - $840 :D
You are able to live comfortably on $33k per year thanks to no mortgage. A mortgage easily tops that amount in this area. If I try to be nitpicky, I would add about $10k annually for the future expenses such as replacement of autos, home appliances and home repair and maintenance. Still it comes out under $50k - excellent. Social security may easily cover them all with a decent lifetime earnings history.
Why would somebody who saves that much care about SS?

mervinj7
Posts: 1161
Joined: Thu Mar 27, 2014 3:10 pm

Re: HCOL savings rates

Post by mervinj7 » Mon Aug 19, 2019 12:22 pm

huai wrote:
Mon Aug 19, 2019 6:57 am
Starfish wrote:
Sat Aug 17, 2019 3:02 pm
Anyway this illustrates why these topic is no use for anybody: you get all the extremes. You get people who live with very little money and people who spend them all. With million income you can rent a 2bdr apartment or you can buy a 5 million $ house, you can send your kids to public school or to Harker for 50k a yer per kid, you can drive a civic or a ferrari.
Well that poster’s income is way south of the target range I was looking at, but the few who have posted have been extremely helpful
My advice is for OP to post what they think their projected income, spending by category, and savings will be if they move to the Bay Area. Then folks who live here can specifically give advice based on somewhat real numbers. Otherwise, you will just get a broad spectrum of selected responses that are generally skewed towards high savings rate scenarios. For example, DINKs that bought a house seven years ago will have a very different financial situation than a family of five who just moved here.

mmmodem
Posts: 1814
Joined: Thu May 20, 2010 1:22 pm

Re: HCOL savings rates

Post by mmmodem » Mon Aug 19, 2019 12:23 pm

mervinj7 wrote:
Mon Aug 19, 2019 10:59 am
mmmodem wrote:
Mon Aug 19, 2019 7:58 am
Bought home in SF Bay Area 7 years ago.
Family of 5
Household income: ~$150k
401k + Roth IRA + HSA: ~$27k
We only save in tax advantaged accounts.

We moved out of the HCOLA a little over a year ago to LCOLA.
Household income dropped to ~$120k
401k+ Roth IRA + HSA = ~$37k
Did you sell your home when you left? If so, that's a sizable increase in your net worth.
We did not as we wanted to keep open the option to return to the Bay Area if we did not like the new place. It would be difficult to return, otherwise. The home is currently being rented.

MoneyMarathon
Posts: 556
Joined: Sun Sep 30, 2012 3:38 am

Re: HCOL savings rates

Post by MoneyMarathon » Mon Aug 19, 2019 12:27 pm

huai wrote:
Thu Aug 15, 2019 8:47 pm
For those of you who live in the SF Bay Area (and didn’t buy your house 10 years or more ago) if you are making high 6 to low 7 figures total comp
This is an odd way to ask the question. If you're interested in how people save to buy a house, it'd make sense to ask how much they were making in the years prior to buying the house, not 1-10 years later when they already have the house (and, for some, that house doubled in value).

new2bogle
Posts: 1480
Joined: Fri Sep 11, 2009 2:05 pm

Re: HCOL savings rates

Post by new2bogle » Mon Aug 19, 2019 3:21 pm

Litfury wrote:
Thu Aug 15, 2019 9:31 pm
Ron Ronnerson wrote:
Thu Aug 15, 2019 9:23 pm
I meet most of the criteria you outlined so I’ll respond. I’m a public-school teacher and my wife is a stay-at-home parent in the Bay Area. We bought our home less than 10 years ago. Here are our numbers:

Income: $115k (no health benefits provided by the school district, though)
Taxes: $2k/year for federal income taxes, $0 for California income taxes (despite the common misconception, taxes are progressive here instead of being high)
Housing cost: mortgage for 2150 sq. ft townhouse in a great neighborhood with great schools (4 bedroom/4 bathroom): $1800/month, property taxes: $10k/year (or $840/month), HOA: $290/month
Tiny lap giraffes: $0
Savings: $11k toward pension; $19k into 403b, $19k into 457b, $4k into IRA accounts, $10k toward mortgage principal (which we count as savings since we might sell our Bay Area home and move elsewhere in retirement)
My pension should be approximately $100k/year (in 2019 dollars) around age 60 and cover all our retirement expenses
Above poster says taxes aren't high in California then pays 840 a month in property taxes...
I am in TX and would love to pay "only" $840/month in property taxes.

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