[mr_pink]

> It takes about 2 years to save up $100K on a typical Bay Area engineer's salary

Have you actually done this? Know anyone who has? This seems completely implausible, outside of some extreme frugal lifestyle cases (I'm talking "eating garbage dumped by grocery stores" level frugal)...

[nostrademons]

I actually saved up $100K in about 18 months, working at a large Bay Area tech company and living in Mountain View. I don't feel I made significant compromises to do so, either: I had roommates for 6 of those 18 months but lived in a 1BR afterwards, I had friends (many of whom I still keep up with), I owned a car and got out on weekends. I did cook the majority of my (non-employer-provided) meals at home, and my friends tended to like relatively cheap activities like LAN parties, board games, and hiking rather than expensive meals out. I didn't go on any major vacations, but my family lives back East, and so that includes rather expensive airfare at Christmas, Thanksgiving, and 4th of July to see them.

[mr_pink]

Paycheck calculator shows me that $120K [1] in CA leaves you with $6,220 after-tax monthly income. If you really made about as much, and managed to save ~$5.5K a month, then you spent only ~$660 a month, which is just impossible, sorry. Even if you're sharing a 1BR with several roommates, which, by the way, is not really an option for many.

[1] Googling "average software engineer salary california" shows figures ranging from 107k to 135k, 120k seems to be more or less the median of Google's figures.

Edit: added footnote

[pedrosorio]

Single person $150k gross pay (salary, stock, bonus). $94k net pay according to this: http://www.paycheckcity.com/calculator/salary

Not being very frugal:

  - rents $2000K/mo 1BR apartment (single but wants some comfort in the Peninsula, no hellish commutes from East Bay)
  - transportation $200/mo
  - free lunch (and possibly dinner) at the company - eating out and groceries $300/mo
  - entertainment $200/mo

That's $2700/mo. Let's round it up to $3000/mo because you're a well paid software engineer and can spend $300/mo on top of what I listed whenever you feel like it.

So far, $36k expenses + $50k savings and you still have $8k left to go on ski trips to Tahoe, Outside Lands and other non-frugal lifestyle expenses.

[jartelt]

A decent 1BR on the peninsula (in San Mateo, Redwood City, Mountain View, etc.) is likely closer to >$2,500 a month plus $200/month for utilities/renters insurance. For transportation, I pay $200/month for a 15 year old Civic with liability insurance. If you have a moderately nice car that isn't paid off, you are going to pay >$200/month (especially if you commute daily). If you cook moderately nice meals and drink some alcohol, that food budget is likely going to be >$400/month. Plus going out to happy hour once a week, which isn't that uncommon, can easily cost you an extra $30-50 a week (or more). A good number of people have college debt as well, so add a monthly payment for that. I agree with you that saving is definitely possible when single and making >$100,000. I just think you low balled most of your numbers to prove your point.

[ceras]

Sure, I did this (and more if you count my 401k). I don't think I was that frugal: I certainly didn't want for anything, and ate my fair share of sushi.

Like the article mentions, saving a lot is easy if you're fine with a roommate and living in a non-luxury apartment, but if your housing standards are higher than that then it's tougher.

This is, of course, at the compensation levels talked about in the article. Some companies (early stage start-ups, banks) pay much less.

[morgante]

I went from a net worth of <$50k at age 20 to >$150k at 22, while never being particularly frugal at all. Heck, I didn't even have roommates. My monthly spending averaged $4k/m.

NYC, not SF, but the difference isn't huge.

Most people are atrocious with their money by either overspending or under-optimizing.

[mr_pink]

OK, it all depends on what the cash flow looks like :) You're leaving out that one very important piece of the puzzle...

Also, the average apartment in Manhattan (if you do rent without roommates) is pretty close to your cited figure for total monthly expenses. Which means you either lucked out, or seriously compromised on your living arrangements.

[falsedan]

I did it, paying $3400/month rent & supporting a family. Salary took care of living + unexpected expenses, and stock grants/purchase plans took care of the saving + knowing where to keep the money (thanks, years of scraping by on non-SF-ludicrous pay packets).

edit I don't know what a 401k is good for (I already have two retirement saving schemes in other countries), mostly did staycations since SF is such a tourist destination.