"The problem with America’s semi-rich" -- sound familiar around these forums?

San Jose is much larger and probably more representative of the area; Zillow says about $1.3 million for the “typical” home value in San Jose.

Of course, Los Altos is also a smaller city that is one of the more expensive places in the area.

While it is possible to spend half of a $300k post-tax income on rent or a mortgage , it is by no means a requirement to live in the Bay Area. It is a choice. One could also find decent properties for half of the listed figures within the Bay Area. The median household income in SF county is ~$120k. Most people manage to get by with far less.

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No question about that. But a good reason not to come here (or leave) nowadays for many people in that earning bracket. And a lot have been here a long time and paid a lot less for their houses. I’ve mentioned before my Uber driver who lived in a $5M house in Palo Alto that he inherited from his parents (who bought it for $20K).

Yes, but there are a lot of people between Mountain View and San Mateo, and most family size homes are $2M+. So you can go to San Jose or Fremont (or even further out) and commute (once people go back to the office) and impact your quality of life in that way. Lots of people do it. But if you earn $300K your quality of life would be a lot better in other parts of the country.

Many of the jobs are in San Jose, rather than in the more expensive areas on the peninsula, so those living in the more expensive areas on the peninsula may be the ones doing more commuting.

Anyway, what prevents a family with a $300k income from spending like a family with $100k to $150k income (still around median or above in much of the area) and saving and investing the rest of after-tax income? It is not like the family with $100k to $150k income is “poor”.

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Driving your Tesla to Draegers can get expensive. :stuck_out_tongue_winking_eye:

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If you bought your house 15 years ago then that’s fine. If you move here now then you have to decide if you have a poor quality of life just to save for college, or you spend everything you earn on a house and (unless you strike it lucky with equity) plan for your kids to go to a UC. Many do the latter, very few people I know have saved much in a 529. After all, prices have risen so much that leveraging yourself up to buy the best house you can has worked very well for the last 50 years.

To be clear, this is not “woe is me”, I’ve been here for 20 years. But I wouldn’t recommend anyone to move here now and I fully expect my kids not to come back after college.

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FWIW, lots of families buy homes out in the 238/580 corridor, cities like Castro Valley, Dublin, San Ramon, Pleasanton, Livermore, Mountain House, Tracy, etc. and commute or take BART.

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And by the time you get there, many other parts of the country start to look like a much better option (not to mention what happens to the value of those houses in a 2008 like downturn)

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Somebody is buying all those houses out there.

My D’s roommate at CP SLO is from the Stockton/Lodi area. I met a guy at a recent powerlifting competition who drove to the Peninsula from Manteca.

Lots of jobs out there, including a recently-built large Amazon Fulfillment Center.

The high cost of living usually contributes to the high earnings bracket. A Silicon Valley software engineer is unlikely to earn the same salary if they move from SV to take a new job in a low cost of living area. A similar statement could be made about NYC, Boston, Seattle, and other locations associated with higher cost of livings and higher salaries.

A higher cost of living means $300k doesn’t go as far in SV than most other areas of the US, but that doesn’t mean SV families with $300k income cannot be expected to have much income left over for college or must pay the figures you listed on real estate. There are far less expensive good options for real estate, including ones that do not involve commuting from another county. Some high income families may choose to spend the bulk of income on real estate. Others may choose to spend less on real estate, and spend more on investing or college savings.

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That is a brutal commute.

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In the last few decades the most successful bet has been to go all in on Silicon Valley real estate and then borrow against the growing equity to fund college expenses (and ultimately use the equity for retirement when you sell and move away). The question (especially for those who are earlier in their careers and have young kids) is whether that is going to be a viable option in the future.

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People forget that high income families may not have been high earners their entire careers. When we had our first child, my dh was making less than $40K. It is only as our oldest kids were near college age that he began earning an income that puts us in the full pay category.

I have observed those who qualify for significant aid drive luxury cars, take expensive vacations, etc., which are things we don’t do. We are happy with our income, financial situation, and college options for our kids, so it doesn’t bother us. However, I have observed what BunnyWu described above.

The exorbitant price of college opens the door for this type of judging and complaining. Our parents did not save nor help fund college, but it wasn’t as much of an issue back then as the prices were not so high as to require parental support.

People make all kinds of choices re: family size, single vs dual income, lifestyle, etc. that affect college funding, as is their right. I don’t care about my friends’ and neighbors’ personal choices, regardless of income level. I do believe college prices are too high. Even those who qualify for significant aid may not receive the amount of aid they need to make college affordable if they can’t get into selective meets need colleges.

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My kids kept expanding their search for a house. I’ve been following home costs in Sunnyvale and other cities for months, and, to an outsider, one gets old and little homes. After a while, a half hour commute doesn’t seem so bad.

Does anyone expect the home costs to fall in next few years?

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Lol, of course this thread has dissolved into the plight of the full pay and the cost of living in the Bay Area.

Some things never change.

Once upon a time, my kid qualified for significant financial aid. We had 2 in college, one was full pay at a state college, no merit. We drove one newer car and one that had 200,000 miles. We lived in a 1100 sq.ft. house with a detached garage and 1 bath, in a low COL area. We took no vacations except to a siblings cottage when invited. And we took loans, quite a few loans that took years of living frugally to pay off.

But we’ve managed to get our kids through college, they were loan free (because we paid them) and have great jobs and great lives. And go on much better vacations than their parents.

So if we are those parents you are talking about, this was our reality. Also many parents get need based financial aid and merit mixed up.

Please don’t feel sorry for us. We got lucky that one kid was able to gain admittance to a needs based university. We’ve recovered and will retire with plenty. But we never were and will never be in the 9.9%

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If you drove old cars and took no vacations, then no, you are not the type of parents being talked about.

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OMG, you’re my parents! All kidding aside, the fact that i am a member of the 9.9% today is pure luck. I qualified for need-based fin aid at a college that was very generous with it. And, it feels as if everything that followed was a consequence of that. But, here’s the thing: getting rich was never my goal. I was just trying to keep my head above water. It just felt as though over the years fewer and fewer young people were able to afford things I had grown to take for granted. Like living without roommates. More than one suit in the closet. More than one pair of dress shoes. A down payment (admittedly a biggie.) A mortgage. A mortgage deduction. A 401-k Plan. Capital gains. The list has grown almost imperceptibly over the course of my adult life. Yet, all I was trying to do was “avoid being poor”.

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Forgive me if I missed this along the way - does one need to possess both the income component as well as the net work component to be considered in the top 9.9%?

I’m honestly surprised that the income levels are as low as they are - both for individuals and households.

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I think those numbers are either-or. A lot of the people in the highest net worth bin are recent retirees (another similar-sized bunch is nearing retirement) and so have low incomes. Medians and means tell different stories here.

I think all lot of us can relate. My sense is my kids will have to work harder to have what I have. But I’m also looking at it from the point of view of someone who has been comfortable (through hard work mind you) for a long time. When you don’t have much, the word “sacrifice” means something different than what it means to me now.

I too was just trying to improve my lot. Not a grand plan. I just wanted to be able to do and have some things. Real Sperry Topsiders; not the knock-off brand.

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