Author Topic: Accepting opportunity to relocate to the US?  (Read 3533 times)

jezsh

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Accepting opportunity to relocate to the US?
« on: October 26, 2016, 04:00:59 AM »
I work in Europe for a company whose headquarters are in San Francisco. My boss and boss's boss have brought up the possibility of me relocating and I'm having trouble working out whether I should. It would be the same position with a salary increase, but of course there would be associated cost of living increases.

Current situation:
Salary: 71k EUR before tax, 40k after tax
Mortgage: 700 EUR p/m, 3% interest
Savings rate: 55%

Approximate situation if I move:
Salary: 100-120k USD
Rent: 1500 USD P/M (I'm guessing based on what I know others pay)
Relocation bonus: 10k
Healthcare: Covered by company
Travel costs: Covered by company

Other considerations:

  • I already live abroad and have been doing so for about seven years. I'd like to move again in the near future
  • I would likely have the type of visa that restricts your eligibility to work to the company sponsoring you and would enter the visa lottery each year
  • The housing market where I live is extremely hot and I could easily sell my apartment for around 60k EUR profit
  • I currently have my own apartment but doubt I would want to shell out for that in SF!
  • I have a cat I'd either have to bring with me or rehome
  • I have a partner but am unmarried and am unsure how/whether he would be able to join me eventually

I know from a life experience perspective I'd really enjoy living in a new place. From a career perspective, it's possible that living in San Francisco would open a lot of doors for me, both because I work in tech and because I have many contacts there. However, I want to understand a) whether it'd make financial sense or would make my journey to FIRE longer and more difficult and b) whether I'm underestimating the impact of factors such as downgrading to a smaller living space and possibly doing long distance with my partner.

Any advice on how I can figure out if this is a good decision or any stories from people who've faced something similar would be much appreciated!

ShoulderThingThatGoesUp

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Re: Accepting opportunity to relocate to the US?
« Reply #1 on: October 26, 2016, 04:26:56 AM »
I think you ought to visit San Francisco and look at some apartments, do your prospective commute, and so on to really get an idea. From what I've heard I'm not sure that $1500/month will get you much there. They don't have any branch offices elsewhere in the country?

jezsh

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Re: Accepting opportunity to relocate to the US?
« Reply #2 on: October 26, 2016, 05:33:00 AM »
Mm good point, that is possible. I'm going off what colleagues told me it might cost for a room in a shared apartment, but things might have changed. I'll do some sleuthing online to confirm if my price estimate is correct or not.

I've already visited a few times and spent six weeks working there a year or so back, so I'm fairly familiar with the city itself and the commute. It's more the specifics of rent, taxation, benefits, saving etc that I'm unfamiliar with as it's very different to where I'm currently living.

Thanks for the advice!

expatartist

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Re: Accepting opportunity to relocate to the US?
« Reply #3 on: October 26, 2016, 05:53:13 AM »
This sounds like an exciting opportunity.  $1500 sounds doable for a room in a shared apt, which it sounds like you're willing to do.

Is the apt you currently own a potential rental?
How does your SO feel about the possibility? Would they be eligible to work in the US as well?

jezsh

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Re: Accepting opportunity to relocate to the US?
« Reply #4 on: October 26, 2016, 08:13:26 AM »
In order to rent my apartment, I would need permission from the bank, but they do sometimes grant that if you're leaving the country. It could make a good rental since rental prices are high and mortgages are low currently. I'd be equally happy to sell, since it's gone up quite a bit in value in the two years I've owned it and I don't know a lot about landlording!

SO is very keen on moving but less keen on the prospect of a long-distance relationship if it came to that. Can't say I blame him. We actually work at the same company but in different departments. I don't know if he would be able to get a transfer too, but that would definitely make things a lot easier if it were possible.

doneby35

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Re: Accepting opportunity to relocate to the US?
« Reply #5 on: October 26, 2016, 09:09:40 AM »
You really don't want to rent in San Francisco, unless you have at least 2 other roommates, in order to keep your rent down to less than $800. I used to live there, and my salary was a little higher than $120k, i decided to leave because it's not worth it, personally i think $1500 for rent AND a roommate is just ridiculous. However, if you're getting an increase from 70k euro which is 75k USD to 120k USD, i would say go for it, get a couple of roommates and save the extra money.

ShoulderThingThatGoesUp

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Re: Accepting opportunity to relocate to the US?
« Reply #6 on: October 26, 2016, 09:53:23 AM »
The raise is nice, but if they also have an office in Charlotte or Dallas or basically any place outside of SF and would pay you $100k there instead, do that.

Jack

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Re: Accepting opportunity to relocate to the US?
« Reply #7 on: October 26, 2016, 10:12:42 AM »
SO is very keen on moving but less keen on the prospect of a long-distance relationship if it came to that. Can't say I blame him. We actually work at the same company but in different departments. I don't know if he would be able to get a transfer too, but that would definitely make things a lot easier if it were possible.

You could tell your boss that you'd agree to relocate if and only if the SO could be relocated along with you.

jezsh

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Re: Accepting opportunity to relocate to the US?
« Reply #8 on: October 26, 2016, 11:16:40 AM »
SO is very keen on moving but less keen on the prospect of a long-distance relationship if it came to that. Can't say I blame him. We actually work at the same company but in different departments. I don't know if he would be able to get a transfer too, but that would definitely make things a lot easier if it were possible.

You could tell your boss that you'd agree to relocate if and only if the SO could be relocated along with you.

I'm sure they'd be happy to in theory as we're hiring aggressively next year. I don't know what the immigration rules would allow, though. I'm no expert, but from my understanding, they can make a business case for me as I'm in a technical role. Since he's not, so I'm not sure if it would be harder to sponsor him. Not too well-versed on this area though!

The raise is nice, but if they also have an office in Charlotte or Dallas or basically any place outside of SF and would pay you $100k there instead, do that.

Unfortunately only SF and New York so far!

You really don't want to rent in San Francisco, unless you have at least 2 other roommates, in order to keep your rent down to less than $800. I used to live there, and my salary was a little higher than $120k, i decided to leave because it's not worth it, personally i think $1500 for rent AND a roommate is just ridiculous. However, if you're getting an increase from 70k euro which is 75k USD to 120k USD, i would say go for it, get a couple of roommates and save the extra money.

You're not the only one who thinks it's ridiculous :) I'm not psyched about the prospect of living with roommates again, but if it were just one or two I think that would be fine. Most of my previous experiences were houses of 5+ which got a bit crazy sometimes. If my SO were able to come, we'd probably have more flexibility.

The raise of course sounds great in theory, but I am unsure how far it'd actually go with the additional costs in rent. On the other hand, I live in a super tax-happy country right now where even my savings get taxed (regardless of whether they earned interest), so I might benefit in that regard...

Can anyone recommend any good resources for calculating salary after tax were I to relocate?

SKL-HOU

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Re: Accepting opportunity to relocate to the US?
« Reply #9 on: October 26, 2016, 11:52:18 AM »
They can get your SO an L-1 (intra-company transfer) visa I believe. What are they getting you?

Jack

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Re: Accepting opportunity to relocate to the US?
« Reply #10 on: October 26, 2016, 11:59:29 AM »

Can anyone recommend any good resources for calculating salary after tax were I to relocate?

I'd say the only good way would be to actually calculate your taxes:

https://www.irs.gov/pub/irs-pdf/i1040gi.pdf
https://www.irs.gov/pub/irs-pdf/f1040.pdf

https://www.ftb.ca.gov/forms/search/index.aspx

https://www.tax.ny.gov/forms/

The Federal taxes aren't as complicated as people like to think, but doing the math might be a little bit overkill for someone who isn't even here yet. One of the simplified forms might be good enough:

https://www.irs.gov/pub/irs-pdf/f1040a.pdf
https://www.irs.gov/pub/irs-pdf/f1040ez.pdf

 I have no idea how CA or NY taxes work; I just googled for the forms. For all I know there might even be local income tax in SF or NYC too.

jezsh

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Re: Accepting opportunity to relocate to the US?
« Reply #11 on: October 26, 2016, 12:59:56 PM »
The Federal taxes aren't as complicated as people like to think, but doing the math might be a little bit overkill for someone who isn't even here yet. One of the simplified forms might be good enough:

https://www.irs.gov/pub/irs-pdf/f1040a.pdf
https://www.irs.gov/pub/irs-pdf/f1040ez.pdf

Amazing, thank you!

Tester

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Re: Accepting opportunity to relocate to the US?
« Reply #12 on: October 26, 2016, 02:39:31 PM »
They can get your SO an L-1 (intra-company transfer) visa I believe. What are they getting you?

In fact I think you should get there on an L1 - in this case you SO will get a L2 - which gives the right to work without being tied to the sponsor - you apply for and EAD just to be sure you have it if the employer asks.

Goldielocks

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Re: Accepting opportunity to relocate to the US?
« Reply #13 on: October 26, 2016, 07:37:50 PM »
Yeah, an L1 is a management transfer, and the spouse (and kids) come along on an L2, allowing  them access to work and public schools, etc.   I am not sure if you can file 'married jointly' from your country on an L1.  You can from Canada to USA, but that may be because of tax treaty... Note, you can't file jointly on a TN, for example, or H1B from some countries.

Filing jointly for taxes is a huge benefit, as your spouse can't work until they get the work authorization, and that can take 6 months after arrival... meaning that only one of you has significant income the first year.

$120k is not a great amount of money for San Francisco.  I made $125k, 10 years ago, and with a young family of 4, and 1.5 hours outside of SFO, we made it work, but there was not a lot of money left over. $2650/mo in renting a house, preschool, etc. Our savings rate was about 7% back then.

Because you seem quite flexible about living accommodation, see if your employer will provide you with a place to live for the first year, and maybe for a lesser salary.  Many employers have townhomes or apartments that they keep for long term project employees, that can be reassigned to you with a bit of negotiation, and it costs them far less than it would cost you (as they have had it for many years).


Tester

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Re: Accepting opportunity to relocate to the US?
« Reply #14 on: October 27, 2016, 12:18:55 AM »
 L1 is for non management too, I am on L1.
But it might be harder to make the case for L1 if you don't have good tenure, plus other conditions for the L1 which I don't really know.
The good thing with L1 is that it allows you to apply for permanent resident status, plus I think it has separate available openings from other types of visas.
I don't remember how we filed, will have to look.
About the money I don't know, I am in another part of the country so I can't know the expenses for your potential place.

Good luck with any decision you make.
If you need more information ask, hopefully we can help.

jezsh

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Re: Accepting opportunity to relocate to the US?
« Reply #15 on: October 27, 2016, 03:48:11 AM »
Yeah, an L1 is a management transfer, and the spouse (and kids) come along on an L2, allowing  them access to work and public schools, etc.   I am not sure if you can file 'married jointly' from your country on an L1.  You can from Canada to USA, but that may be because of tax treaty... Note, you can't file jointly on a TN, for example, or H1B from some countries.

Filing jointly for taxes is a huge benefit, as your spouse can't work until they get the work authorization, and that can take 6 months after arrival... meaning that only one of you has significant income the first year.

$120k is not a great amount of money for San Francisco.  I made $125k, 10 years ago, and with a young family of 4, and 1.5 hours outside of SFO, we made it work, but there was not a lot of money left over. $2650/mo in renting a house, preschool, etc. Our savings rate was about 7% back then.

Because you seem quite flexible about living accommodation, see if your employer will provide you with a place to live for the first year, and maybe for a lesser salary.  Many employers have townhomes or apartments that they keep for long term project employees, that can be reassigned to you with a bit of negotiation, and it costs them far less than it would cost you (as they have had it for many years).

Lots of good ideas for things to look into, thank you.

I don't believe the company has any apartments, although they really should look into it as they spend an absolute fortune on accommodation for visiting employees. Still worth asking.

Leaving aside the SO issue for a moment, I have been trying to do some rough calculations and this is what I've come up with so far to compare my financial situation currently vs SF:

Cost/LocationCurrentSF
Salary70000110000
After Tax41000 (41% tax)71500 (35% tax)
Housing900018000
Left over after tax/housing3230053500
Amount needed for 50% savings rate2065035750
Leftover to spend1165017750
% Leftover to spend28%24%

My conclusion from this is that overall there's a fairly similar outcome. I've tried to be both conservative with the income and the amount owed in taxes. Anything I am missing though? Is this far too hopeful a picture?!

Appreciate everyone's responses so far - it's really helpful!

munch

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Re: Accepting opportunity to relocate to the US?
« Reply #16 on: October 27, 2016, 06:59:00 AM »
I did quick calc on taxes and you are probably not far off conservatively.  If you could file as married and with a dependent then will lower the taxes.

For expenses other than rent you are left with 17k -- get an estimate of how these might change in SF vs where you live now.

One expense that you will have that you dont have now is airfare back to visit family.  I would guess your company will give you and your SO at least one paid flight per year?  Any additional trips would be at your expense.

So going by your numbers at end of it all you save another $15k per year and would be living in one of the key areas for your field with possibility to make many connections to further opportunities.   Before I moved out of the US for an opportunity offered to me I asked myself the question -- "20 years from now would I regret NOT taking this step?"  My answer was yes.   So I took it and yeah there have been tradeoffs but am glad I did take it.

Good luck!

Goldielocks

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Re: Accepting opportunity to relocate to the US?
« Reply #17 on: October 27, 2016, 06:02:17 PM »
One thing that you have missed in your analysis.

Living in or near San Francisco is awesome.   Really Awesome.   

Once you get past all the money numbers, and assuming you are ok with crowds and congestion at times--> the weather, the people, city and surrounding natural areas are absolutely wonderful.

schneider

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Re: Accepting opportunity to relocate to the US?
« Reply #18 on: October 28, 2016, 05:41:36 AM »
What do you know, I'm contemplating the reverse[-ish]: http://forum.mrmoneymustache.com/ask-a-mustachian/riskycool-career-move-short-term-pay-cut-(or-first-world-problems-)/

My conclusion from this is that overall there's a fairly similar outcome. I've tried to be both conservative with the income and the amount owed in taxes. Anything I am missing though? Is this far too hopeful a picture?!

I agree with a lot of what's been said here: it's going to be a challenge to find a place you'd want to live in the Bay Area for $1500 (viable with flatmates, impossible without), but other than that your math looks about right. If your housing budget were $3500/month and you budgeted in one flight a year, it would probably be about a wash. Lots of people thinks it's worth it!

One thing to be aware of: the US government does not recognize domestic partnerships at all so far as I know; as I understand it you would have to get married to sponsor your partner for an L2 visa.

jezsh

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Re: Accepting opportunity to relocate to the US?
« Reply #19 on: October 28, 2016, 07:54:41 AM »
What do you know, I'm contemplating the reverse[-ish]: http://forum.mrmoneymustache.com/ask-a-mustachian/riskycool-career-move-short-term-pay-cut-(or-first-world-problems-)/

That's exciting! I'll write a comment on that thread to return the favour :)

I agree with a lot of what's been said here: it's going to be a challenge to find a place you'd want to live in the Bay Area for $1500 (viable with flatmates, impossible without), but other than that your math looks about right. If your housing budget were $3500/month and you budgeted in one flight a year, it would probably be about a wash. Lots of people thinks it's worth it!

One thing to be aware of: the US government does not recognize domestic partnerships at all so far as I know; as I understand it you would have to get married to sponsor your partner for an L2 visa.

Yeah I agree. I don't think I could force myself to pay over maybe 2000 in rent unless the salary were a lot higher than I'm expecting.

You're right about the marriage part. Now that I've thought through the financials, that's the part that still remains difficult.