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Financial Analysis of Moving From San Francisco to Boston

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DICKSON, TN - Last week, I mentioned that I'm moving from San Francisco to Boston and focused on the emotional change. With all that mamsy-pamsy junk out of the way, let's dig into the mathy, financial fun side of the move.

Straight Dollars and Cents

Many people take a new job because it will pay them more money. At least that's usually a big factor. That's not the case here. We'll be losing about $500 a month. A portion of my wife's military pay is pegged to the costs of living in an area. San Francisco is one of the highest, if not the very highest on the scale. Boston is still very high on the compensation list.

On the other hand, unlike many military moves, where the spouse (i.e. me) has his/her job completely uprooted, all my income should remain unchanged.

As for the actual costs of moving, the military foots most of that bill. They even gave us some cash for incidental costs incurred in moving. The only thing that I can think of is that we are giving up some Groupons. We might use those next year (minus the promotional value) when we plan to come and visit.

Costs of Living

The cost of living in Boston and where we would be living is considerably less than San Francisco. Here's one example: our 1400 sq. ft home with a small patio was costing us $3200 a month to rent... and that is a bargain compared to the nearly $900,000 it would cost to buy it.

It is that reality that put a swift end to any thoughts of living in San Francisco permanently. When my wife retires from the military, her housing allowance disappears... and blogging in San Francisco doesn't pay more than blogging in Winslow, Arizona.

Opportunities Gained and Lost

Whenever you evaluate something as big as this, it also is worth looking into the opportunity cost.

In general, my wife's military status is pretty rigid. It's not like the private sector where living in Silicon Valley gives someone a chance at switching to a better technology job down the line. That said, when the time for promotions come around, a switch to a new job shows growth and looks very good.

It's always tough to quantify "opportunity", but it doesn't appear that my wife will lose much and has more to gain.

On the other hand, I've had the pleasure of working with a number of financial start-ups in Silicon Valley. I wrote for Prosper's blog, which was a nice side job. I got the chance to work a bit with Mint, which wasn't the best experience (they are in a better direction now than they were before). Beyond the work things, SaveUp (review: SaveUp Brings the Fun While Rewarding You for Saving) invited me to their Christmas party.

I'll surely miss out on some of these opportunities, but I'm not sure how much they've added to the bottom line.

The Hidden Benefits

The biggest hidden benefit is one that I haven't mentioned yet. With the new position my wife will work 4 ten hour days a week, with two of them work from home. It's interesting to note that even the government recognizes that it is a signficant cost savings when people work from home. With only two days of commuting, we'll recognize a savings on gas and wear and tear on the car. (She was already bringing her lunch most of the time, so that's not a saving like some would recognize by working from home.)

In San Francisco, my wife had occasionally been working from home and she found that she would naturally work 9 or 10 hours, putting her commuting time into work. Now she'll actually get credit for it. The 10-hour days when she has to go into the office will be difficult, but the hope is two days a week isn't too bad, especially in exchange for 3-day weekend.

It took me a couple of weeks to realize another hidden perk. My wife gets 30 days of vacation a year (government jobs are good like that). In 5 day work weeks, that turns out to be 6 weeks. In 4 day work weeks, it is 7.5 weeks of vacation. This is where I ask readers not to go off into a tangent about government spending, the fiscal cliff, or any of the related topics that I have been listening to on talk radio as I drive across the country.

Breaking away from financial analysis for a second, my wife will now be around the home 5 days a week to see our son grow up versus the 2 days of week she had in San Francisco. This is huge for us.

Child Care Costs

While I hardly expect our extended families to put in a lot of time with baby sitting... having grandmothers around will likely lead to some savings.

Summing it up

This didn't turn out to be the kind of financial analysis that I had hoped when I wrote the title. However, just setting the up the pros and cons list makes me quite confident that we'll come out of this move for the better.

P.S. Did you catch the dateline in the beginning of this post. I've always wanted to do that. Just like a real reporter, right? We're mostly through our travel across the country (taking the Southern route to avoid storms as much as possible). We couldn't figure out why Nashville was so expensive to stay in, but it turns out that it has the Grammy's concert and the baseball winter meetings going on.

Posted on December 6, 2012.

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11 Responses to “Financial Analysis of Moving From San Francisco to Boston”

  1. Kosmo says:

    “My wife gets 30 days of vacation a year (government jobs are good like that). In 5 day work weeks, that turns out to be 6 weeks. In 4 day work weeks, it is 7.5 weeks of vacation.”

    Really? In my company, we have people working 8, 9, or 10 days in a two weeks span, with varying lengths of work days. Our vacation is X number of standard length days, but it’s technically a set amount of hours. If I take a day of vacation, it eats up slightly more than 1 vacation day.

    Is your wife could find a way to work two 20 hour days, she could get 15 weeks of vacation per year.

  2. Ken says:

    In regards to people going off on the military leave system it is worth mentioning how combined weeks are charged. At a civilian job you are charged for the workdays you take and not the weekends, normally. In the military that’s not the case. If your wife wanted M-Th, normal work days, of two consecutive weeks she would be required to use 11 days( M-TH of the following week) of leave to get 8 days off. Not taking 11 days would violate the rule regarding combing leave and liberty.

    Leave/liberty/leave is not allowed but liberty/leave/liberty is allowed.

  3. Steve says:

    Doesn’t military leave count weekends? That’s my understanding of why it’s so generous. In the private sector, I work an alternative/flex schedule, but that doesn’t make my vacation days 25% more potent… a work day is still 8 hours officially. I either take 8 hours and spread the extra time across the other days in the pay period, or if there is more than one vacation day in a a pay period I usually just suspend the flex time for that period.

    • Lazy Man says:

      Kosmo,

      The military doesn’t do the earned hourly thing that the private sector does. I don’t know if they considered the ramifications of a full-day vacation policy in allowing people to work four 10s. They don’t allow you to do the three 13.3s or two 20s.

      Ken,

      You are right about the weekends. If my wife takes a Thurs and a following Monday, it counts as 5 vacation days, even if she’d only normally those 2. It’s a stiff penalty if you aren’t flexible. However, if you just take a Mon through Thurs and don’t span the weekend, it’s only the 4 days that you’d typically take. I’m told other armed forces have changed this sort of thing… at least for some professionals like doctors. I could be mistaken.

  4. Steve says:

    And if she could work 70 hour days, she would get 52 weeks of vacation. Working 70 hours in a single day may be hard, but since she doesn’t have to show up, it might as well be infinity.

    • Lazy Man says:

      Even if she figured out a way to sign in for working 70 hour days, she’d really only have to work 40 hour days to fulfill the work week and still would get a maximum of 30 days off per year. Sorry Steve, it fails in many ways, not just the 70 hour day.

  5. kosmo says:

    If she can find out a way to work a 40 hour day, let me know. I’m pretty sure that violates the basic principle of “24 hours in a day”

  6. MJS says:

    One cost you are leaving out. The amount of therapy she’ll need having to spend five days a week at home with you (just kidding). I work mostly from home now myself and I can tell you if the wife did as well, I would have office space booked tomorrow.

    • Lazy Man says:

      I’ll probably be looking to book some office space at some point. We’ll see. She’ll be in the office two days a week and she can be the day care person on Fridays.

  7. RichUncle EL says:

    Congrats on the move and good luck.

  8. […] Before we get to that video, I want to tell you that I personally feel the message of the video and it's a large reason why I moved back to New England. Financially, I covered some of our reasons for moving in this article back in 2012: Financial Analysis of Moving From San Francisco to Boston. […]

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