[kelnos]

Yes. I live in SF right now, and have friends who live in MV, Sunnyvale, and Palo Alto (among other south bay/peninsula cities).

But you can easily pay for a $3k/mo apartment on $130k/yr, still have a good amount of disposable income, and still be putting money toward savings/college loans/stocks/whatever.

Even $4k/mo for rent is doable. That's $48k/yr, and if you can't live off the remainder (say $40k after taxes), my opinion is that you need to take a hard look at the crap you spend money on.

Of course Texas is cheaper than this. Not at all debating that. Money goes farther in some places than in others; this is not news. I'm merely addressing the assertion that $130k/yr doesn't get you "much", which is demonstrably false, and sounds like it was written by someone who hasn't lived here.

Whether or not you can do "better" elsewhere is a matter of preference. I personally would find the idea of moving to Texas (or a great many other places where the dollar buys you more) unappealing, regardless of what my financial situation would be there. Paying a premium to live in SF (while still sending 40+% of my software-developer salary right to savings/stocks/mutual funds every month) is worth it to me.

[potatolicious]

Your math doesn't work.

40% of a $130K salary is $52,000. $48K a year in rent brings the total up to $100,000.

You still haven't paid for food yet, or any other cost.

Assuming you're a silicon-lifeform that can subsist off of minerals leached from the ground, you'd still need a 22% or lower tax rate to make this work.

Which is to say, your math doesn't work, at all. Even assuming $3K a month in rent, your overall tax rate (remember, you're a silicon lifeform that doesn't eat) still needs to be ~31% to make it work out. This is definitely not the case in California.

Assuming you're human (and therefore need to pay for food, clothing, bills, such), you are nowhere near being able to take a $3K (much less $4K) rent on a $130K salary. The level of spending you're talking about is more appropriate for someone with a $130K income post-tax, which by California tax rates puts you in the $200-220K range, pre-tax.

[kelnos]

Sorry, for the saving-40% figure I was talking about me, not the hypothetical person who makes $130k. I should have been clearer on that point. And I was also talking about 40% post-tax, not pre-.

Still, I'm not understanding how you think a $3k/mo rent isn't possible on $130k/yr. I personally know people who do that.

Let's be conservative and say 40% tax rate. That's $78k left. $3k/mo on rent is $36k/yr, which drops you down to $42k. If you can't eat, drink, and be merry on $42k/yr, and still save some money, I would seriously suggest you take a hard look at your priorities.

I wouldn't say that at that level you'd necessarily want to sock away 40% (again, post-tax), but that's even doable if you're living on your own and don't have dependents: 40% of your post-tax pay on $130k is $46,800. Subtract $3k/mo for rent, and you have just shy of $11k free. I'm not saying you're going to have tons of fun spending only $11k/yr on food and entertainment, but it's certainly possible. But instead dial it down to 30% or 25% or whatever. I bet at that level you'd still be saving more than the average American.

[judk]

You forgot income tax. Or children. Or both.

[kelnos]

I absolutely did not ignore income tax.

I did ignore children, fairly deliberately. If you do have kids, then hopefully there are two parents, both with income (yes, I know this isn't always the case).

Four people (two parents and two kids) will live much cheaper together than four people living on their own. Kids are expensive. I get that. That changes the equation quite a bit. I'm not particularly equipped to do that math since I don't have kids and don't know what they tend to "cost".