Possible Job Transfer from LCOL (NE WI) to MHCOL (Reno, NV) - Advice on salary differential expectations?

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BanditKing
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Possible Job Transfer from LCOL (NE WI) to MHCOL (Reno, NV) - Advice on salary differential expectations?

Post by BanditKing »

I am interviewing a second time for a position with my Megacorp that would relocate me from a LCOL area (NE Wisconsin) to MCOL to MHCOL (depending on perspective) area being Reno, NV. I've made it known that the cost of living differential needs to be part of any overall proposal, but now that I've progressed to the second round, I wanted to get some thoughts.

The position change would be a lateral, but allows me to move to an area I've been wanting to relocate to for some time with a job and longevity already in place.

My current area has your basic post-2000 3bd/2ba homes in the $170-200k range, and it looks like similar homes I'm seeing online in Reno are in the $400-500k range depending on location and age. Currently looking in the NW part of the city, outside the beltline, up 395 towards Lemon Valley area, which is close to the office location. Sun Valley is also an option. If I can find a place, great (I know the market is stupid crazy right now), so I may rent for a year in order to have more options.

My currently salary is about $90k(base) + ~$25k(target commission range). My current mortgage is very low - about $800/mo inclusive of taxes and insurance due to an older-but-immaculate house I lucked into a year ago that was significantly underpriced. My instinct says I should target in the $120-130k range for the base salary. The target commission is "universal" across the organization so that's not really negotiable. Am I aiming too low to maintain a similar QOL?

I don't have a tremendous amount of leverage with the company. Besides basic salary bands being a limiting factor, they don't really NEED to move me as I'm quite successful where I am - it would be about allowing a season veteran to relocate where they'd like to, vs risking my leaving on my own.

Any insights would be appreciated.
Tingting1013
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Re: Possible Job Transfer from LCOL (NE WI) to MHCOL (Reno, NV) - Advice on salary differential expectations?

Post by Tingting1013 »

I would be very surprised if your company considers Nevada and Wisconsin to be in different pay bands. My company has five pay bands across the US and both those locations would be in the bottom pay band.
Starfish
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Re: Possible Job Transfer from LCOL (NE WI) to MHCOL (Reno, NV) - Advice on salary differential expectations?

Post by Starfish »

Tingting1013 wrote: Tue Apr 06, 2021 10:47 pm I would be very surprised if your company considers Nevada and Wisconsin to be in different pay bands. My company has five pay bands across the US and both those locations would be in the bottom pay band.
Nevada is huge and has all kind of prices. Stateline and Incline Village have NorCal prices.
Reno is very close to California and I expect to be more like Cali than Nevada.
Last edited by Starfish on Tue Apr 06, 2021 11:22 pm, edited 1 time in total.
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Watty
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Re: Possible Job Transfer from LCOL (NE WI) to MHCOL (Reno, NV) - Advice on salary differential expectations?

Post by Watty »

I have done the opposite where I have moved from a high cost of living area to much lower cost of living area but I found an equivalent new job at a different company. I was able to make a lateral move and keep my old salary. It might vary with what field you are in but I have moved around since then and my impression is that unless you are in some special situation salaries do not vary with the local cost of living by as much as you might think and usually not enough to pay for difference in the cost of living. People in higher cost of living areas often settle for a lower standard of living when it comes to things like housing.

Even if the company does pay you $20K more in the new location a lot of that will go to pay income and FICA taxes. Do all your calculations in after tax dollars.

Salaries are all about supply and demand and there are even situations where someone like a doctor might be paid more to move to a low cost of living area to work in a small town hospital in Wisconsin than they would get paid in a large more expensive city where there are lots of doctors that can be recruited when some place like a hospital needs to hire a doctor.

You should check salary websites to see what people with your job are being paid in Reno. That will be somewhere around what the company will be willing to pay unless there is a special situation. The company will not really care about the cost of living if they can hire someone locally for less than it would cost you to maintain your current standard of living.

Don't underestimate just how much that will cost to move.

Years ago during a merger I did a company paid relocation and it was expensive even though I was not a senior manager or anything like that. The costs involved selling and buying a house, moving stuff, house hunting trips, etc. I never saw a total number but that easily cost the company over $50K and today it would be a lot more than that. Anything the company is not paying for you will end up paying for. Once you own a house moving is a lot more expensive than just renting a U-Haul truck.
BanditKing wrote: Tue Apr 06, 2021 10:44 pm My current mortgage is very low - about $800/mo inclusive of taxes and insurance due to an older-but-immaculate house I lucked into a year ago that was significantly underpriced.
If you have lived in the house for less than two years you will not qualify for the homeowners capital gains exclusion so you would need to pay capital gains taxes on any gains.
Tingting1013
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Re: Possible Job Transfer from LCOL (NE WI) to MHCOL (Reno, NV) - Advice on salary differential expectations?

Post by Tingting1013 »

Starfish wrote: Tue Apr 06, 2021 11:21 pm
Tingting1013 wrote: Tue Apr 06, 2021 10:47 pm I would be very surprised if your company considers Nevada and Wisconsin to be in different pay bands. My company has five pay bands across the US and both those locations would be in the bottom pay band.
Nevada is huge and has all kind of prices. Stateline and Incline Village have NorCal prices.
Reno is very close to California and I expect to be more like Cali than Nevada.
I didn’t say they were equal in cost of living. I said companies are not likely to pay differently. Two different concepts.

My company makes this explicit on its internal wiki:

“We do not pay based on cost of living. We pay based on cost of talent.”
Annabel Lee
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Re: Possible Job Transfer from LCOL (NE WI) to MHCOL (Reno, NV) - Advice on salary differential expectations?

Post by Annabel Lee »

Were you asked to apply for this role or did you take it upon yourself to find it and post for it?

If the former, Megacorp may sweeten the deal to convince you to make the move. I’d be surprised if they weren’t offering you a higher salary for your new job in NV. Further it would be customary for Megacorp to pay for your move, house-hunting trip(s) etc.

If the latter, it’s very unlikely that the firm will make any special concessions for you. Also it will very likely be on your shoulders to pay for the 2000 mile move of the contents of your house to Reno. Have you priced this out?

Worth noting... Due to COVID almost every Megacorp has scaled relocation benefits WAY back, recognizing massive savings. Why move people around the world when it’s generally not permitted, and why move people around the country when you can stream in on Zoom? Will be really interesting to see how, if, and when corporate relos come back.
trueblueky
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Re: Possible Job Transfer from LCOL (NE WI) to MHCOL (Reno, NV) - Advice on salary differential expectations?

Post by trueblueky »

Please note that, under current tax law, moving expenses are not deductible. MegaCorp reimbursement of moving expenses is taxable income.
marie17
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Re: Possible Job Transfer from LCOL (NE WI) to MHCOL (Reno, NV) - Advice on salary differential expectations?

Post by marie17 »

Most companies do a cost of labor comparison not a cost of living comparison. At my megacorp, WI and NV are the same. Even WI and Boston are the same (which is nuts, but don't get me started). The only "premium" markets are the bay area and nyc. I would be surprised if you see a difference, but i wish you luck.
TLL24
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Re: Possible Job Transfer from LCOL (NE WI) to MHCOL (Reno, NV) - Advice on salary differential expectations?

Post by TLL24 »

I've relocated across the country 3 times in the past 5 years for work (WI to TN, TN to WI, and WI to FL). Companies often have different philosophies on compensation, but in my experience they will bend their rules for someone they really want.

Obviously, the compensation is an important factor in your decision and to help balance the COL differences here is what I recommend looking into:

- Compare estimated rent or mortgage payments: sounds like you've figured out NV will cost you more here
- Compare state income taxes: big win or you here, NV has no state income tax
- Compare property taxes: you may have done this with your mortgage comparison, but make sure you do your research to understand what those could be (example: FL has "homestead" tax break where property taxes cannot grow faster than 3% per year, however the tax rate resets when a property is sold, so the new owner immediately pays a higher tax rate, sometimes much higher depending how long the prior owner lived there)
- Compare homeowners and auto insurance costs - you might be surprised at differences and I recommend getting quotes on houses for sale in an area you would realistically live

Those items should help you figure out what the larger cost differences can be. Surely, there can be others (sales tax, cost of groceries/gasoline, cost of utilities), but those won't be material enough to impact the bigger picture.


One time costs to consider:

- Will your employer pay for relocation services? Packing, shipping, potential storage, and delivery of our 3 bedroom house cost about $15K to $18K each move. Shipping one vehicle cost about $1,500 each move.
- As someone else already posted, relocation assistance is not deductible for tax purposes and actually considered income. If your employer will cover relocation costs, will they also gross up the dollars they give to you to cover the tax liability?
- Will your employer pay for closing costs to sell your house and/or buy a house in NV?


Good luck and don't get stressed about the details and enjoy the journey!
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