The Low Stability of High Income

(ofdollarsanddata.com)

30 points | by williamsmj 11 hours ago ago

12 comments

  • qzw 9 hours ago

    Annual income twenty pounds, annual expenditure nineteen nineteen and six, result happiness. Annual income twenty pounds, annual expenditure twenty pounds ought and six, result misery. — Charles Dickens, David Copperfield

    Good old Chucky D. was a financial guru before it was cool.

  • cbhl 10 hours ago

    > how much could you conservatively make in a replacement job? If you set your current spending based on that level of income

    I didn't love the numbers in the article -- they assume $500k total comp, but the levels.fyi heatmap from a few days ago shows SFBA median total comp is $263k, with 64% being base so $169k. Federal taxes are 64k, state taxes are 21k. That leaves you with maybe ~$80k in liquid salary.

    A market-rate studio apartment is $2700-$3000/mo which is about $36k in annual expense. That's about half of your income. Add food and transportation and there's not much left to save for retirement or emergency fund.

    If for some reason you are in the lurch and have to start driving ubers or working at starbucks, you're not going to be able to afford the same kind of apartment that you need to do hybrid work and join meetings at a FAANG job.

    • jerlam 7 hours ago

      Wouldn't your non-base salary (nearly $100k) be your savings/emergency fund?

  • matt3210 11 hours ago

    RSUs and other vesting should be (as in, it would be nice if they did) prorated in the event of a layoff (assuming layoff here means no-fault separation).

    • brailsafe 6 hours ago

      That would be the only situation in which I'd even consider them part of compensation. If I can't use it to pay my rent now, it might as well not exist, given the likelihood I'd never be able to realize them anyway.

    • bigfatkitten 11 hours ago

      Sometimes it is if the company feels generous, though even in countries with strong employment law these benefits have no statutory protection.

      One of my previous employers had a rule where they would vest all of my RSU if I were to die while employed there.

      • clipsy 9 hours ago

        > One of my previous employers had a rule where they would vest all of my RSU if I were to die while employed there.

        Idle curiosity: Was that in lieu of or in addition to life insurance? (Most of my employers have had free life insurance with a payout of a multiple of base salary.)

        • bigfatkitten 9 hours ago

          That's in addition. Just a goodwill thing that they did.

      • ThrowawayTestr 8 hours ago

        Anyone fake their death?

  • ilrwbwrkhv 4 hours ago

    Yes, this is quite true and one of the reasons I left trying to find a job and start my own business. With the business you actually have control over your life. And now I crossed more than I could have ever gotten as a salary by doing my own thing.

  • agrtar 10 hours ago

    We need more weapons for Israel and Ukraine, perhaps a good old fashioned war with Iran so that energy costs go up even further and we have nice stagflations like in the oil crisis in the 1970s.

    Let the world burn so that Lindsay Graham and his ilk cash in while FAANG has major layoffs.

    • Jerrrrrrry 40 minutes ago

      Ukraine is an investment, Israel is our military/diplomatic/stregetic "All lie" in the Middle East.

      And a proxy war between Isreal and Yemen with the US and "everyone else" tagging in and out depending on civil/political trife seems likely, until the area is glassed by India and Pakistan.