Does Lower Cost of Living Mean Lower Income?

[mark311]

Originally Posted by mike_terror

I'm currently residing in Buena Park, California (Southern California) living with my parents and plan to get more information about moving to Texas for a better job market and lower cost of living. I'm 23 and will be passing my CPA exam real soon. I'm looking into Texas because of the booming economy with the oil companies.

From everything that you've stated above, it sounds like you should be posting this in the Houston forum and not in the Austin forum. The big oil companies are mostly headquartered in Houston. Housing is generally a bit cheaper in Houston as well while the salaries are roughly the same or even sometimes better than Austin.

A lot of the Californians that you mention moving to Texas are getting the benefit of affordable homes along with good schools compared to the CA equivalent so it's not just the cost of housing benefits. It's some of the non-monetary benefits like good schools and ultra-safe neighborhoods that are attractive. In my opinion, the cost of living differences for a 23 year old willing to rent an apartment in Buena Park might not completely make up for the difference in salary in Austin because some of the major benefits are ones that you might not care about in regards to lower crime in Austin along with better public schools.

So let's say that an apartment that might run you $1300 in Buena Park might be $800 in the Austin area (I'm just throwing these numbers out there). That's a difference of $6000 per year. And then let's say that the rest of your expenses average to be about 10% lower in the Austin area and that saves you another $4000 per year total. You would be about $10K ahead, but as you stated, it's possible that this could even out for you. Now if you wanted to buy a $200K home in a suburb of Austin that feeds into good schools that has almost no crime, it's almost a no brainer that the Austin area wins out over Buena Park. Of course, you could move to Riverside and then the gap gets a little closer.

I'm basically just trying to point out that you'll need to evaluate certain things on your own. As long as you don't mind being a 20 to 40 minute drive from dowtown Austin, you can buy a pretty nice house in a safe area with good schools for about $160K. That is where a lot of the "cost of living" differences are. A family just can't find that in CA currently.

[OpenD]

Originally Posted by OpenD

What you want is to use a Salary Comparison Calculator which takes into account both prices for common consumer expenses AND salary ranges and taxes, to give you a comparison of what salaries are worth. For example, comparing Atlanta to Boston, Sperling's calculates that your $100,000 salary in Atlanta would have to increase to $146,000 in Boston to have the same buying power, due to higher prices and taxes in Boston.

Here's the one I referred to, but there are others. It probably pays to try 2 or 3 and compare: Moderator cut: link removed, linking to competitor sites is not allowed

Here's an example, using the COL Calculator I mentioned above... to enjoy the same standard of living, you would need to earn $50,000 in Buena Park, but only $37,075 in Austin. So if the same job paid $50K in BP, and $42.5K in Austin, you'd be over $5K ahead working in Austin. See how that works?

And the comparison between BP and Houston is even more favorable... it would only take $31,752 salary in Houston to match the buying power of a $50K income in CA. And since it's already been pointed out that Houston is where the oil business is, you might want to look in that direction.

Good luck!

[texastrigirl]

Originally Posted by LI2Texas

It is true that many of the offices here for top accounting firms are smaller than Houston or Dallas. However at this point, most of the larger accounting firms have offices here - PWC, EY, Deloitte, KMPG and BDO are all here.

Yes, but they are small offices. Much more likely to get hired in a bigger city where they take a "class" of 30-40 new hires every fall. Not 3-4.

[mike_terror]

Thank you everyone for chiming in with your insightful advice and suggestions. Thanks to all the examples that never crossed my mind, I do kind of see the bigger picture now of how it's not so black and white since there's many other factors and variables involved.

I will definitely take a look at Houston and Dallas as well since it may offer more opportunities for jobs in my career field.

@texastrigirl, I value your advice, especially from someone with years of experience in the field. I would really like to get an entry-level auditing position with a public accounting firm as that would be my goal. As others have mentioned, a lot of local graduate candidates will indeed have an edge over an outsider like myself. I'm not some hot-shot candidate with a really high GPA or with previous public accounting experience. Do you think my chances of obtaining a position will be slim due to being an outsider? Did you enter public accounting doing tax or auditing? What was your college / career path?

^ sorry, the above questions may be a little off topic. If you happen to have the time and don't mind PMing me, that would be greatly appreciated!!

[cp102]

Have you saved 6 months of living expenses in case it takes that long to get a job. My son is an accountant and as a family we all moved here. It took 6 months for him to get a job we never thought it would take that long. In Austin they have the IRS that starts hiring around January of each year, apply beginning of December. This is a temp job that would give you time to find a more permanent one. Living here I have found that most companies don't hire you until your here..obviously that depends on the type of job your looking at. You can also apply for state jobs in your field. BUt this too takes time because they are plenty of people applying.

Houston seemed to offer more jobs in the accounting field for someone out of state but we had all bought homes prior to moving to Austin...we didn't think a job would be hard to get. Thankfully we did have money in reserve and our son was able to get thru the dry spell . Good luck in whatever you choose.

[Josephus22]

Any advice for a 23yr hospitality major with a Bachelor's degree trying to move to TX?

[drshdw]

Originally Posted by Josephus22

Any advice for a 23yr hospitality major with a Bachelor's degree trying to move to TX?

Apply at one of the new hotels building/opening?