New Mustachian in search of wisdom. Major life change incoming!

[Xandamere]

Hi all,

First, I'd just like to say I'm really glad I found this site. :) What an awesome place, and I've spent a couple of days trolling around the forums and reading up on all of the content here. Lots of great finance and lifestyle blogs out there, but the community here seems just amazing and I'm happy to be joining it.

So, here's my situation:

I currently live in Daly City, California (just outside of San Francisco). After wasting most of my 20s floundering around, I went to grad school and was lucky enough to land a great job when I finished, about a year and a half ago. I make about $90k, but given real estate prices around here, it would still take at least another year to save up for a down payment.

I have an opportunity to move to Las Vegas this year, as my company is starting up an office there and they offered me the chance to run it. It wouldn't be a promotion, per se, but I'd get to keep my same salary at a much, much cheaper area. I'm married, but my wife is currently unemployed (just got out of school herself). In the long term, we would really like to settle in the Bay area, as both of our families are nearby and we love the area. We have no debt and about $25k in liquid assets, along with another $20k in retirement funds. My thoughts on this currently are:

-Go to Vegas this year and buy a house right away (from browsing around Zillow, there are some really nice-looking ones in the $100k range).
-I anticipate my wife and I could live for around $2k/month in Vegas. My take-home pay would be $6k/month in Nevada (with no state income tax), not including bonuses and whatever work my wife would be able to find. That's at LEAST $48k/year, and likely more like $80k once wife income + bonuses are taken into account.
-Stay in Vegas for between 1-2 years, then move back to the Bay area with a nice down payment in hand.
-Depending on the market in Las Vegas, either sell the house there or keep it and rent it out (my best friend lives there, so I would have somebody around to keep an eye on the place).

I'd love to hear peoples' thoughts! And if any of you are located in Las Vegas, I would especially love to hear any input you could offer about the state of the real estate market, or even just which neighborhoods are desirable and which I should stay away from.

[sherr]

It sounds like a good strategy to me. Honestly I would probably stay in Vegas longer than a couple years, as your good job coupled with the low cost of living would let you get ahead much faster there than if you stay in the Bay area.

To quote Yogi Berra: "When you come to a fork in the road, take it!"

[icefr]

I might consider renting for a year before you're sure you want to stay there and that would help you figure out where you want to live within the area. Have you run the New York Times Buy vs Rent calculator? http://www.nytimes.com/interactive/business/buy-rent-calculator.html It's pretty awesome.

[unpolloloco]

One note: Transaction costs on either end of the home purchase might be enough to sway you towards renting in Las Vegas.  Check these out before purchasing.

[Xandamere]

That calculator says I'll be better off buying after 2-3 years (depending on inputs). Not shabby...renting is certainly an option, but like I said, I was also thinking about keeping the property as a rental when I move back.

On a financial level, I know this move makes sense. On a personal level, it's trickier, and I guess that's what I'm looking for a bit of advice/guidance with...is this worth uprooting my whole life for? For anyone else who's done something like this, how did it turn out? Is there anything I'm not considering that I should be?

[boy_bye]

That calculator says I'll be better off buying after 2-3 years (depending on inputs). Not shabby...renting is certainly an option, but like I said, I was also thinking about keeping the property as a rental when I move back.

On a financial level, I know this move makes sense. On a personal level, it's trickier, and I guess that's what I'm looking for a bit of advice/guidance with...is this worth uprooting my whole life for? For anyone else who's done something like this, how did it turn out? Is there anything I'm not considering that I should be?

when i am making a decision and find myself at a loss, i start making lists. what will i gain from the move, and what will i lose? it really helps to see the pros and cons down on paper.

i also find it helpful to consider the worst case scenario. what would be the worst case scenario here? you move, you hate it, your wife can't find work, but you're making a good salary. is that something you can live with? would you be able to undo whatever you'd done in 2-3 years if you decide you want to move back to the bay area?

most decisions you make can be easily backtracked, and your course can always be adjusted. from what you've told us, you stand to really benefit from this move, and the risks don't sound like anything you can't back away from in the future if you change your mind ...

[John74]

Sounds like a very good strategy to me. I think it is pretty hard to build wealth in the Bay Area unless you make tons of money. So if you can make the same amount of money in a much lower COL area, it should give you a great head start. I may live in San Francisco now, but I didn't make it to FI here. I lived in the deep south while working for a Bay Area employer with a Bay Area income. It was an incredibly effective way to build wealth (high income, low expenses and low taxes).

I understand that on a personal level, it may require some sacrifice (moving away from family and uprooting your whole life). So it depends how motivated you are with regards to FI.

[Tyler]

My wife and I went through a very similar situation in reverse. We moved to the Bay Area 5 years ago for job opportunities, saved as much as possible (renting, of course), and recently moved to Austin once we realized how close we are to FI if we smartly mange expenses. Even far before ER was even on our radar, in retrospect both moves served that end plan well. Flexibility opens up all kinds of opportunities that others arbitrarily deprive themselves of.

And FWIW, we worked out that staying in the Bay Area long-term could add another decade to our required working careers over moving to a different area. As many things as we loved about California, that wasn't a reasonable tradeoff for us. We'd much prefer to retire elsewhere and take long leisurely trips to visit friends in San Francisco. ;)

But to each his own.  I understand the draw, even before you bring family into the picture. The fact that you're thinking smartly about savings early is a great sign you'll find a way to achieve whatever goal you have in mind.

[CNM]

Your plan sounds good, except for the buying a house part.  If I were staying for such a short amount of time, I'd probably end up renting.  It might be hard/take a while to get rid of the house and I'd hate to be in a situation where I have to pay 2 mortgages or a mortgage and a rent.

[lizzigee]

Re your query about is it worth uprooting your whole life for? Maybe my way of thinking is different, coming from NZ.  Since we are so far from most of the rest of the world , it's quite common for young Kiwis (NZers) to do the big OE for a few years and check out what the rest of the world is like.  So I don't think it's that big of a deal for you and your wife to move partway across your own country for a couple of years.  Have a good plan, have a backup plan in case you both hate it, or determine beforehand how long you think you can stick it out if the benefits in the long run outweigh some temporary pain. Nothing ventured, nothing gained.

[Xandamere]

Thank you all so much for the input - I feel like the move is the right choice, but it's really, really nice to get some additional thoughts. My wife and I have decided that we will take this opportunity if it presents itself (still waiting on full confirmation from the company). Now to negotiate how much they'll pay me to relocate...

[DoubleDown]

Flexibility opens up all kinds of opportunities that others arbitrarily deprive themselves of.

Well said! That could be a "thought for the day" on a radio station or something

[Phoebe]

I also did the reverse, moved from the mid-west out to the Bay Area to pursue a job opportunity and stayed there for 2 years.  I lived very cheaply (super hard in that area, but doable) and paid off all my debts.  After 2 years I moved back to the midwest where my family is and the job experience I had under my belt allowed my to get a much higher salary and coupled with the low cost of living, start to build up my stache.

I would take the move while you're still young and don't have kids.  You can always move back later and you'll look back on your little adventure fondly.

Good luck!

[SunshineGirl]

I would not buy. Owning a house is a lot more expensive than you might think, and Vegas sounds like a strange market. Just rent a nice place, save up, then move back to the Bay Area when you're ready. It'll be easier for you to walk away if you don't own.