Let's say my salary is $100k/year, and my expenses are $90k/year. I have $10k/year to save (or blow). If I move to somewhere with 3x salary and 3x costs, then my salary goes to $300k/year and my expenses go to $270k/year, and so I now have $30k/year left over.
But it's not that simple, because of progressive tax rates. The federal income tax on $300k/year is more than 3x the tax on $100k/year. Or, to put it a different way, you get 3x the salary, but not 3x the take home pay. Out of that less-than-3x take home pay, you now get to pay the 3x expenses.
Now, it could be that when people say "3x the expenses", they're taking that into account. But I suspect they're not. I suspect they're looking at COL numbers, and I suspect that the published COL numbers are just housing, food, medical, and the like.
Your taxes go up a bit because, yes, taxes are graduated. But it’s not as big a deal, and your SS is capped. A house hold making $450k/year in a high COL is still going to be doing much better than 200k in a low COL.
Lots of costs aren’t indexed to the area you live in. Computer, phones, trips to Mexico, and to some extent cars cost similar in SF as they do in Mississippi. Food prices don’t vary as much either, their might be a 20% difference, but not 3X, same with medical (really, housing is the main thing that is very much more expensive, everything else is slightly more expensive to the same price).
Your retirement savings include your house, so you have a career in SF and then retire to New Mexico, the locals will hate you and your crazy home equity you bring with you.
Yup I saw this with a lot of friends who chose to retire in their 20s to Portland. They could live remarkably comfortably working simple hourly retail jobs while I was busting my hump at competitive big corporate jobs NYC to live in less comfortable circumstances. Their "Portland dollars" income went very far on "Portland dollars" denominated goods&services like their rent, food trucks, entertainment, etc.
However our disposable income was dramatically different. So anything in "US dollars" like airplane tickets, smartphones, etc were out of reach to them.
Let's say my salary is $100k/year, and my expenses are $90k/year. I have $10k/year to save (or blow). If I move to somewhere with 3x salary and 3x costs, then my salary goes to $300k/year and my expenses go to $270k/year, and so I now have $30k/year left over.
But it's not that simple, because of progressive tax rates. The federal income tax on $300k/year is more than 3x the tax on $100k/year. Or, to put it a different way, you get 3x the salary, but not 3x the take home pay. Out of that less-than-3x take home pay, you now get to pay the 3x expenses.
Now, it could be that when people say "3x the expenses", they're taking that into account. But I suspect they're not. I suspect they're looking at COL numbers, and I suspect that the published COL numbers are just housing, food, medical, and the like.