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Old 08-06-2019, 05:47 AM
 
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Yes for the most part a salary should adjust and always be higher in a HCOL market; however, what your inferring is if your standard of living adjusts. E.g. does a 50% COL increase translate into a 50% salary increase which I would state emphatically no for the most part. So to answer your question it's both the salary can increase so 20% but your cost go up 50% to no covering the difference.
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Old 08-06-2019, 05:50 AM
 
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Originally Posted by damba View Post
Depends on the industry and individual position/type of work. It also depends on how one chooses to live in the HCOL area. YMMV
Definitely this. Iíve had two careers so far both were professional consultant type roles and in both my experiences when interviewing in places like DC, Seattle, Boston, etc. they wouldnít come that close to even matching my pay in the Midwest when I said my starting point would be 80% of the average of the top 3 cost of living calculators. So the starting point theoretically being a 20% paycut and they all reached out to me.

In general unless you are an elite talent in any industry the pay isnít worth the cost of living outside of perhaps high finance where there just isnít A lot of options outside the huge cities and lawyers who want to go the big law route.
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Old 08-06-2019, 05:51 AM
 
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I think it depends on the field, the company and how badly they want you.

In 1978, 3 years out of college, I moved from Ohio to NJ and got a nice bump- good thing since my rent doubled. In 2003 I accepted a job in the KC area with only a slight increase over my previous job, but bought twice the house at half the price- with lower property taxes. Did REALLY well on that one.

Later the company was acquired by one based in Zurich. When the job I had was showing signs of going away I looked at internal positions and found that if I took one in London, Zurich or Westchester, NY (where all the good jobs were) they didn't pay any salary differential for moving from KC. Umm...no. Fortunately I found another job at a company in the area.
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Old 08-06-2019, 07:50 AM
 
Location: Raleigh
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Originally Posted by damba View Post
Depends on the industry and individual position/type of work. It also depends on how one chooses to live in the HCOL area. YMMV
And the area WRT the position/industry.
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Old 08-06-2019, 08:07 AM
 
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I was shocked to find out most jobs don't pay much more in high COL. People just make it seem like they are living the life in HCOL area but the truth is they are saving so much less
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Old 08-06-2019, 08:20 AM
 
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Originally Posted by keraT View Post
I was shocked to find out most jobs don't pay much more in high COL. People just make it seem like they are living the life in HCOL area but the truth is they are saving so much less
I think about 20-30 years ago they did pay more (even adjusting for Cost of Living), but since they've become the "cool place to live" for millennials like me they've been able to get away with pushing it as a lifestyle improvement along with a slight nominal pay increase.

I got asked to interview for a job in DC and they asked me what total compensation I had in mind. The math suggests about a 70% cost of living increase, I said I'd need about a 50% increase to continue discussions and gave the accompanying #. The recruiter chuckled and suggested the top end they had in mind aligned with a 30% increase. I told her that given my wife would need to quit her job (which would have ended up being a HH income nominal pay cut given the total compensation they quoted me ) and we'd be moving 2 kids we wouldn't be able to make it work financially. I've had similar experiences with roles in Seattle and Boston. They think the name of their company and the city itself should be enough to get you to move at what typically equates to a real pay cut.

But hey! You work for Amazon and you're in Seattle, right!

Last edited by mizzourah2006; 08-06-2019 at 08:32 AM..
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Old 08-06-2019, 08:54 AM
 
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Originally Posted by keraT View Post
I was shocked to find out most jobs don't pay much more in high COL. People just make it seem like they are living the life in HCOL area but the truth is they are saving so much less
it depends what you do and where ... my profession was factory automation and designing custom pump panels for water and sewage treatment .... i earn a good living here in new york ...

but those skills in pa in the poconos are worth little .

my son is a high power attorney in a labor law firm in manhattan .. his compensation package is much greater then their attorneys in the midwest since they have offices all over the country .
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Old 08-06-2019, 08:55 AM
 
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I live in Washington DC and it is one of the most expensive places to live in the USA. Higher wages cover about 90% of the higher cost of living for professional jobs. But you do fall behind. Where we come out ahead is more opportunities for career growth. I could have a short term higher standard of living in, for example, Knoxville TN than Washington, but my house would not increase in value as much each year and there would be few professional job openings in my field to move into for career growth. So we take annual shortfalls in our standard of living for longer-term prosperity.
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Old 08-06-2019, 09:08 AM
 
Location: WA
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I had two opportunities in the early nineties, one in NYC and one in LA. I was living in Dallas with a middle class lifestyle and a family of five. Both opportunities offered salary and benefits close to double what I was earning and of course many other things. After a careful evaluation I concluded that financially the offers were a wash with limited gain and great challenges (and opportunities) in lifestyle. I did not accept either.
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Old 08-06-2019, 09:39 AM
 
4,598 posts, read 4,766,214 times
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Originally Posted by mathjak107 View Post
it depends what you do and where ... my profession was factory automation and designing custom pump panels for water and sewage treatment .... i earn a good living here in new york ...

but those skills in pa in the poconos are worth little .

my son is a high power attorney in a labor law firm in manhattan .. his compensation package is much greater then their attorneys in the midwest since they have offices all over the country .
Well I don't think the Poconos is really a fair comparison. It's largely a resort town. It would be like saying Breckenridge doesn't pay what Denver does, but especially given that doesn't cost that much less.

There are tons of other lower cost of living cities. Sure in your specific locations of choice (being 2 options) that was likely the case, but my guess is the Poconos doesn't have a booming water and sewage treatment market.

There are other lower cost of living cities that likely would have paid more in real rates.

For example, if you live in Queens (which I think you said you did) and earned $150k (just a guess):

This is what you would need in other cities to maintain your purchasing power:

Atlanta: $100k
Pittsburgh: $101k
Cleveland: $103k
Cincinatti: $94k
Nashville: $98k
Memphis: $85k
Saint Louis: $95k
Kansas City: $95k
Dallas: $104k
Houston: $100k
Tulsa: $94k
OKC: $86k

So yes, if you have only two options to choose from it might not pay more, but if you open up your options it typically will. In my experience, the reason to live in those cities (many of my friends do) is because they couldn't imagine living someplace as boring as the midwest (which they've only visited 3-4x in their lives). Most of my east coast friends think I'm a hillbilly, but hey that's cool with me. I'm the one making an east coast income and saving 50-60% of it that lives 20 minutes form a gorgeous lake and 20 minutes from some of the best mountain biking in the US


And yes, there are certain fields where you just make more in those cities (but those types of roles come with their own issues). My friend who's a lawyer in NYC commutes 1.5 hours each way and works 60-70 hour weeks on top of that. Yeah, he cleared almost $400k last year, but that's also up and out unless you make partner, which very few do. So that'll likely be the most he ever makes in his career and when you adjust it for cost of living it's really only about 40% more than I make and I commute from my bed to my home office, work 40-45 hours per week and didn't have to go $200k in debt for a law degree

You also hear all those stories of parents working high finance in NYC (that make bank), but see their kids basically on the weekends. See I just don't care about money that much.
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