Working in London vs Washington DC
Discussion
Background: I live and work in London as Director of Engineering for a well known but not FAANG company. Skillset is fairly in demand and transferrable across the world. I earn £150k + 20% bonus and other perks which round up the total package to say around £200k. My wife works in Strategy for a Tech company and earns just shy of £120k (£100k + bonus and perks). We have 2 kids (4 and 2) who both go full time nursery and the older one starts at a private prep school in September. We have a comfortable lifestyle, live in an affluent suburb of SW London but in a relatively modest 1930s semi-detached house that is worth say £900k (probably less given recent market conditions). Some investments and a couple of other properties means we are not in any debt (apart from mortgages) but also don’t feel particularly flush at the end of each month. No luxurious cruises on the cards for sure!
My company has offered me a choice between working in London vs Washington DC. We haven’t discussed exact numbers but my boss has indicated that US sticker price / salaries are higher than in the UK. I’m guessing a package of $250k+ would be on the table. My wife would also work when we get there. Not sure what level but looking at similar roles and advertised salaries online, I’m guessing $180k+.
I have no experience of living or working in the US apart from a 1 week work trip, so my knowledge is gleaned either anecdotally or what comes across in the media.
Here’s the pros and cons I’ve drawn up.
US Pros:
My company has offered me a choice between working in London vs Washington DC. We haven’t discussed exact numbers but my boss has indicated that US sticker price / salaries are higher than in the UK. I’m guessing a package of $250k+ would be on the table. My wife would also work when we get there. Not sure what level but looking at similar roles and advertised salaries online, I’m guessing $180k+.
I have no experience of living or working in the US apart from a 1 week work trip, so my knowledge is gleaned either anecdotally or what comes across in the media.
Here’s the pros and cons I’ve drawn up.
US Pros:
- Lower taxation and higher salaries means more savings
- Bigger houses – this is a big thing for both my wife and I, as we grew up in big houses and UK houses always feel too cramped.
- Access to a bigger market compared to UK in case we decide to go into business for ourselves later
- Visas and working through getting permanent residence/green cards etc – we are both British citizens now but came as international students and it took us almost 10y of jumping through hoops to get our citizenship! Doing it again puts me off slightly, though is not an insurmountable task.
- Healthcare – this scares me a little as even with the best insurance, this can cost quite a bit I’ve heard. We don’t have any underlying conditions as such but I would still make sure we’re covered in any circumstance
- Education system not as good as UK private system, though universities are probably better (if more expensive)
Find out the package.
Director at FAANG makes $750-$1M. You said you are not FAANG but I’d still expect a lot more than $250 even in places where the title is diluted like a bank.
But, don’t underestimate cost of living. My old house had 3.5% property taxes. This is NJ so not DC but property tax bills of $20k are not unusual. In my town that doesn’t cover garbage pick up.
Director at FAANG makes $750-$1M. You said you are not FAANG but I’d still expect a lot more than $250 even in places where the title is diluted like a bank.
But, don’t underestimate cost of living. My old house had 3.5% property taxes. This is NJ so not DC but property tax bills of $20k are not unusual. In my town that doesn’t cover garbage pick up.
HJG said:
Can somebody please explain these property taxes ?
I was recently talking to a guy in Texas who said there is no 'income tax' in Texas but 'property tax' is high (sorry to jump in on thread - but spent the last month travelling the US to decide if my wife and I could live here!)
There are State taxes and Federal taxes. When some one says there’s no income tax they are talking state. I had an office of convince in NJ as it was cheaper tax than my real office in NYC. Even then, NY took a piece of my stock vest each year because it was granted when I listed my office in NY 3 years previously.. I was recently talking to a guy in Texas who said there is no 'income tax' in Texas but 'property tax' is high (sorry to jump in on thread - but spent the last month travelling the US to decide if my wife and I could live here!)
Property tax is a way for states to get their slice. I have a friend who has 2 houses and pays over $100k in property tax.
From knowledge of my own line of work, and having looked into transferring across there, I’d say you need at least double your UK salary to make it worthwhile - or triple if you use the dollar figure. So £100k UK you’d need $300k US.
I’m not sure I fancy my kids going to school and having Maths, followed by English followed by ‘active shooter protection’……f
k that! That’s the biggest turn-off for me.
That being said, I do love the US and spend a lot of time there with work. The outdoors lifestyle stuff is epic and on another level to here. Not sure I’d want to be in Washington, though - it’s a bit st.
I’m not sure I fancy my kids going to school and having Maths, followed by English followed by ‘active shooter protection’……f
k that! That’s the biggest turn-off for me. That being said, I do love the US and spend a lot of time there with work. The outdoors lifestyle stuff is epic and on another level to here. Not sure I’d want to be in Washington, though - it’s a bit s
t. Thanks. I guess I was being conservative in my estimate. I do have a guy in my team who is moving from the UK to US and his salary is to go from £70k to about $160k to be in line with market rates in the US. So a doubling (at least) seems to be a safe assumption. $750k to $1m seems toppy though not something I'd say no to - but I'm being pragmatic!
Good call on property taxes - wasn't aware that they were that high. Does this work on purchase price or does it go up and down based on market conditions? A rough look up seems to indicate in the region of 1% - this is quite the change from council tax in the UK which is not tied to property prices.
Gun violence is obviously one of those things that comes up often in any discussion, and one that my wife worries about a lot.
Location wise - we do have people in the team who are also based in San Diego (which seems to be much preferred over somewhere like Washington/Arlington which is the other cluster). The work is remote enough that it can be done from anywhere though I'd look at being within an hour of the office as the RTW movement picks up speed.
Good call on property taxes - wasn't aware that they were that high. Does this work on purchase price or does it go up and down based on market conditions? A rough look up seems to indicate in the region of 1% - this is quite the change from council tax in the UK which is not tied to property prices.
Gun violence is obviously one of those things that comes up often in any discussion, and one that my wife worries about a lot.
Location wise - we do have people in the team who are also based in San Diego (which seems to be much preferred over somewhere like Washington/Arlington which is the other cluster). The work is remote enough that it can be done from anywhere though I'd look at being within an hour of the office as the RTW movement picks up speed.
I posted FAANG as you mentioned them in your OP. FAANG are going to be higher. You can take a look at glassdoor and level.fyi to get an idea. Linkedin estimates are widely inaccurate so would not bother. Most are only showing an estimate of base pay and not total comp.
The 2 locations you gave are both expensive areas to live/exist.
Be aware that stock and bonus can be a huge part of your total comp. For example, Amazon had this "quaint" thing where no one earned more than Geoff. Geoff made $175k base so "everyone" earned $175 base with those in VP positions receiving $1M+ in stock. I mention this as it can have an impact on the way you view your take home. My base is for living and my bonus/stock is for cars, house upgrades, or savings.
Property tax varies massively from state to state, county to county and town to town. Property taxes are often listed on Zillow so take a look. If you rent, it is included in your rent. In NJ assessed value approach can vary from town to town. My house was a "renovation" and kept low property taxes as it had not been reassessed even though there is only the basement left after the renovation. My town then reassessed all properties and my taxes were brought up. My town, and taxes, as given as examples before are not representative of the US. Mine are high.
Crime...
Crime is incredibly localized. I live in the town center (sort of. Thats what is it classed as). We virtually do not have crime. I have a $x000 robot lawn mower out and about in full view of everyone. It gets a lot of attention with cars stopping and dogs chasing him (he is called Geoff). The only issue we have had is the garbage collectors thinking he was out to be thrown away and sending Geoff Sr. to the garbage dump in the sky.
My kids love to leave my garage door open with my Porsche on full view and the keys in it (Boozy, if you are reading this...hands off!).
There is a mind shift for an English person. My kids ride their bikes to school and leave them unlocked all day. An English person thinks they almost deserve to lose them. Over here, if they were stolen the entire police force would be out.
We did have 4 cars stolen last year hence virtually having no crime. There was panic as it seemed to be a crime wave. 4 cars for a town for a year. All 4 of which I know the owners. 2 admitted the keys were in the car at the time. One told me they had lost the key in their brand new X5 when they first got it and had been just jumping in and driving it. Someone else just jumped into it and drove off when they valet parked at a restaurant that is not in our town. (Does that mean we only had 3 cars stolen?). The final 2 cars were owned by one person who is a character... I do not believe the owner about the circumstances and suspect he was looking for a way out of his lease payment.
Gun crime. Guns in general. We have a rule. There is only one house where my kids can go where there are guns. That house is my friend who is a special forces sniper and has everything locked up properly. He knows my feelings and invited me over to inspect. I have no idea what I am looking at but I trust him. He is the only person in my circle that owns guns. My father in law is an idiot and would leave guns around his house. He is the reason guns should be banned. My kids do not go to his house and after he threatened to kill me, he is no longer in my circle.
Gun ownership varies by state and then county. In Northern NJ gun ownership is very low compared to other states.
I am not saying school shootings do not happen. Clearly they do and they are terrible. It is something we have thought about a huge amount. Our schools do have full time police officers. They are incredibly nice and kind to the kids so not like robocop. Having said that I would prefer they not be "required". Looking at the stats, there are 130k schools in the US where we have had 386 shooting in 24 years. That means there is a 0.012% chance per school per year. I am not sure that stat is comforting though but it does assume all schools have an equal chance and I do not believe that as our state is anti gun.
The 2 locations you gave are both expensive areas to live/exist.
Be aware that stock and bonus can be a huge part of your total comp. For example, Amazon had this "quaint" thing where no one earned more than Geoff. Geoff made $175k base so "everyone" earned $175 base with those in VP positions receiving $1M+ in stock. I mention this as it can have an impact on the way you view your take home. My base is for living and my bonus/stock is for cars, house upgrades, or savings.
Property tax varies massively from state to state, county to county and town to town. Property taxes are often listed on Zillow so take a look. If you rent, it is included in your rent. In NJ assessed value approach can vary from town to town. My house was a "renovation" and kept low property taxes as it had not been reassessed even though there is only the basement left after the renovation. My town then reassessed all properties and my taxes were brought up. My town, and taxes, as given as examples before are not representative of the US. Mine are high.
Crime...
Crime is incredibly localized. I live in the town center (sort of. Thats what is it classed as). We virtually do not have crime. I have a $x000 robot lawn mower out and about in full view of everyone. It gets a lot of attention with cars stopping and dogs chasing him (he is called Geoff). The only issue we have had is the garbage collectors thinking he was out to be thrown away and sending Geoff Sr. to the garbage dump in the sky.
My kids love to leave my garage door open with my Porsche on full view and the keys in it (Boozy, if you are reading this...hands off!).
There is a mind shift for an English person. My kids ride their bikes to school and leave them unlocked all day. An English person thinks they almost deserve to lose them. Over here, if they were stolen the entire police force would be out.
We did have 4 cars stolen last year hence virtually having no crime. There was panic as it seemed to be a crime wave. 4 cars for a town for a year. All 4 of which I know the owners. 2 admitted the keys were in the car at the time. One told me they had lost the key in their brand new X5 when they first got it and had been just jumping in and driving it. Someone else just jumped into it and drove off when they valet parked at a restaurant that is not in our town. (Does that mean we only had 3 cars stolen?). The final 2 cars were owned by one person who is a character... I do not believe the owner about the circumstances and suspect he was looking for a way out of his lease payment.
Gun crime. Guns in general. We have a rule. There is only one house where my kids can go where there are guns. That house is my friend who is a special forces sniper and has everything locked up properly. He knows my feelings and invited me over to inspect. I have no idea what I am looking at but I trust him. He is the only person in my circle that owns guns. My father in law is an idiot and would leave guns around his house. He is the reason guns should be banned. My kids do not go to his house and after he threatened to kill me, he is no longer in my circle.
Gun ownership varies by state and then county. In Northern NJ gun ownership is very low compared to other states.
I am not saying school shootings do not happen. Clearly they do and they are terrible. It is something we have thought about a huge amount. Our schools do have full time police officers. They are incredibly nice and kind to the kids so not like robocop. Having said that I would prefer they not be "required". Looking at the stats, there are 130k schools in the US where we have had 386 shooting in 24 years. That means there is a 0.012% chance per school per year. I am not sure that stat is comforting though but it does assume all schools have an equal chance and I do not believe that as our state is anti gun.
h0b0 said:
...
I think this highlights another issue as well - culture.Before I visited the US (as a tourist, admittedly), I expected a lot of similarity, common language etc, perhaps somewhere I'd want to live in future. But afterwards, I realised that really I'm a lot more European - the language might be the same, but the culture was so different, about how people view the world and other people in it.
I think that's probably more important than healthcare and a little bit more money (not to be crass - if it was a life changing amount of money, maybe it'd be different like ex-parts in the middle east).
Jakg said:
h0b0 said:
...
I think this highlights another issue as well - culture.Before I visited the US (as a tourist, admittedly), I expected a lot of similarity, common language etc, perhaps somewhere I'd want to live in future. But afterwards, I realised that really I'm a lot more European - the language might be the same, but the culture was so different, about how people view the world and other people in it.
I think that's probably more important than healthcare and a little bit more money (not to be crass - if it was a life changing amount of money, maybe it'd be different like ex-parts in the middle east).
I came over in 2002 for 2 weeks with work and on my return said "I will never live in that country!". Then in 2003 I was approached by someone that had already done it to move out. He hosted me for an "interview" so I could spend a day in the life of my prospective job. I was still on the fence but my girlfriend was all in. Then, just before I moved out, her mother changed her mind and she dropped out. By that time I had got used to the idea of living in the states and still went through with it. The plan was to stay for 12 months and then head home. I'm still here.
It is not all about money. It can be (I worked for Evil corp for 3 years where my soul absolutely had a price tag! It is also why I know FAANG compensation). But, even when I worked for a bank I made it clear I was walking out of the office at 4:30 to go and grab the kids. I have not had the ability to check email on my phone for nearly a decade. That fact blows my colleagues minds. I have flexibility in my work hours.
Healthcare costs vary by employer so make sure you confirm. My unsubsidized family plan would be about $20k for the 4 of us. After subsidy it is probably around $3k in premiums with additional co-pays for services. It is the copay that scares people because they have heard how you break an arm and go homeless.
Many standard services are included at no cost or copay. My IVF kids (yeah, I am like Chuck Norris because even when I w**k women get pregnant) cost about $20 for the first and $2k for the second. This included scans every day and 3 nights in hospital for the wife for each kid.
Also, when things do go bad... There is then a maximum co-pay per person (about $4k) and a maximum for the family (about $11k). Not peanuts but not going to make you live on the street.
Why are medical bills the number one reason for ending up on the street then? Being uninsured. My kids would have cost $200k each at least. I am looking at them now and questioning the value
. I once had a conversation with an Uber driver who, at the time, had no coverage and was offended someone was going to force him to be protected. He said it was his right to take on the risk.
OK, this leads on to pension. It is called a 401k here. Good companies will match up to 6%. Companies that "strive to be the worlds best employer" will match 50% up to 4%. i.e. 2% in reality. There is a BIG catch here though. The max you can put into a 401k is $22,500/yr. Bummer. Oh yeah and look out for the cut offs. Earn over $x and they will stop matching.
Speaking of cut offs. We do not talk about income in the US. Ever. Why? because there will be someone doing the same job as you earning 30% more and some sad sack earning 30% less. Neither do the job better or worse. At the bank I worked at someone said "Isn't it great how the back up daycare is $x a day". I instantly knew how much they earned because there were different thresholds that were not openly published but I had access to. I politely suggested they do not mention the number in future.
Many standard services are included at no cost or copay. My IVF kids (yeah, I am like Chuck Norris because even when I w**k women get pregnant) cost about $20 for the first and $2k for the second. This included scans every day and 3 nights in hospital for the wife for each kid.
Also, when things do go bad... There is then a maximum co-pay per person (about $4k) and a maximum for the family (about $11k). Not peanuts but not going to make you live on the street.
Why are medical bills the number one reason for ending up on the street then? Being uninsured. My kids would have cost $200k each at least. I am looking at them now and questioning the value
. I once had a conversation with an Uber driver who, at the time, had no coverage and was offended someone was going to force him to be protected. He said it was his right to take on the risk.OK, this leads on to pension. It is called a 401k here. Good companies will match up to 6%. Companies that "strive to be the worlds best employer" will match 50% up to 4%. i.e. 2% in reality. There is a BIG catch here though. The max you can put into a 401k is $22,500/yr. Bummer. Oh yeah and look out for the cut offs. Earn over $x and they will stop matching.
Speaking of cut offs. We do not talk about income in the US. Ever. Why? because there will be someone doing the same job as you earning 30% more and some sad sack earning 30% less. Neither do the job better or worse. At the bank I worked at someone said "Isn't it great how the back up daycare is $x a day". I instantly knew how much they earned because there were different thresholds that were not openly published but I had access to. I politely suggested they do not mention the number in future.
The US is a strange place. Everything is so familiar yet at the same time it is very alien. It's vastness means that it can be very different in the various states, cities, regions.
I was once keen to move to the US, but with the benefit of hindsight I'm glad I didn't. I like the place for a visit but as a final destination, I just don't feel like I could call it home. I've only worked for US companies; I work around Americans all day; I've lived in the US (well Texas) on a couple of occasions, so its not like I'm unfamiliar with the place or the people.
It's hard to put a finger on anything specific though.
I was once keen to move to the US, but with the benefit of hindsight I'm glad I didn't. I like the place for a visit but as a final destination, I just don't feel like I could call it home. I've only worked for US companies; I work around Americans all day; I've lived in the US (well Texas) on a couple of occasions, so its not like I'm unfamiliar with the place or the people.
It's hard to put a finger on anything specific though.
I will speak to my personal experience here:
Move for the non monetary reasons only.
While obviously you want it to be of some kind of financial uplift.. but doing it for your primary reason will lead to misery.
I haven't spent much time in Washington DC but I would guess that a nice part of SW London would be a nice place to live overall, especially in the situation you describe. San Diego is a different kettle of fish. We live in Orange County (North of San Diego) right near the ocean so we have a wonderful lifestyle and really experience the benefits of the weather.. DC doesn't have this upside.
The big big thing you won't appreciate right now but will is the kids and their proximity to family and friends.
We had kids over here so we don't know the difference, but all of the cousins / grandparents / extended family is back at home and i often wonder if they would be happier closer to them.
So really ask yourself how happy you would be vs how much extra money / savings / investments you can make. None of that is worth being miserable, homesick and living a poorer lifestyle.
Move for the non monetary reasons only.
While obviously you want it to be of some kind of financial uplift.. but doing it for your primary reason will lead to misery.
I haven't spent much time in Washington DC but I would guess that a nice part of SW London would be a nice place to live overall, especially in the situation you describe. San Diego is a different kettle of fish. We live in Orange County (North of San Diego) right near the ocean so we have a wonderful lifestyle and really experience the benefits of the weather.. DC doesn't have this upside.
The big big thing you won't appreciate right now but will is the kids and their proximity to family and friends.
We had kids over here so we don't know the difference, but all of the cousins / grandparents / extended family is back at home and i often wonder if they would be happier closer to them.
So really ask yourself how happy you would be vs how much extra money / savings / investments you can make. None of that is worth being miserable, homesick and living a poorer lifestyle.
Thanks, these are really useful points.
I will admit the main drivers are (a) higher salary sounds nicer, and (b) the fact that you get bigger houses (quality of construction notwithstanding).
We will end up losing a lot of our friends, though most friends these days tend be either work based or around the kids school and other activities. Given that they are relatively young, I don't think they would find it too hard and we will end up making a new social circle anyway. We don't really have an extended family network around in London - so that doesn't play into the situation. We have extended family in America but they're spread all over really.
I have worked with some American colleagues and their tendency to work longer hours and shorter holidays is at odds with European ways of working. However, our company tends to promote taking 4w off even for the US employees - so it's not much different compared to the 5w + public holidays that we get in the UK.
Some conversations I've had with work colleagues who did similar things have generally been positive but the fact remains that almost all of them ended up working in the US for a few years and then came back to settle in the UK or other parts of Europe (Spain/France). That seems to be the direction - i.e. it's great to try out for a few years and see if you like it, but don't fully uproot yourself and sever all ties.
My issues with that are that we've worked really hard to get my older son into a really sought after private pre-prep that feeds into one of the top schools nationally (with the younger one set to follow in the same path). If we were to move now and then back again in 3yrs, not sure how that would affect them as it would be around the point for 7+ entries into the prep schools and the American education system won't have prepared them for the entrance exams here.
I will admit the main drivers are (a) higher salary sounds nicer, and (b) the fact that you get bigger houses (quality of construction notwithstanding).
We will end up losing a lot of our friends, though most friends these days tend be either work based or around the kids school and other activities. Given that they are relatively young, I don't think they would find it too hard and we will end up making a new social circle anyway. We don't really have an extended family network around in London - so that doesn't play into the situation. We have extended family in America but they're spread all over really.
I have worked with some American colleagues and their tendency to work longer hours and shorter holidays is at odds with European ways of working. However, our company tends to promote taking 4w off even for the US employees - so it's not much different compared to the 5w + public holidays that we get in the UK.
Some conversations I've had with work colleagues who did similar things have generally been positive but the fact remains that almost all of them ended up working in the US for a few years and then came back to settle in the UK or other parts of Europe (Spain/France). That seems to be the direction - i.e. it's great to try out for a few years and see if you like it, but don't fully uproot yourself and sever all ties.
My issues with that are that we've worked really hard to get my older son into a really sought after private pre-prep that feeds into one of the top schools nationally (with the younger one set to follow in the same path). If we were to move now and then back again in 3yrs, not sure how that would affect them as it would be around the point for 7+ entries into the prep schools and the American education system won't have prepared them for the entrance exams here.
One caution is "fire at will" - if the company does layoffs then your notice period (assuming a US contract) would be very short.
You should qualify for an L1A visa, and your wife would also be able to work while you hold a valid visa.
On the topic of DC it is super expensive to live in and around until you get further out. Super hot and humid in the summer.
You should qualify for an L1A visa, and your wife would also be able to work while you hold a valid visa.
On the topic of DC it is super expensive to live in and around until you get further out. Super hot and humid in the summer.
I've moved to the US with work in the past and there are things to consider:
- The move is expensive, so you really want someone to pay for you to get there
- Depending upon your visa, your partner may not be able to work for 6 months, (This was true with my L1 visa and my wife's L2) (Other visa types are available)
- You will need to work out your residency for tax purposes and be very clear in your declarations
- If not selling your houses, think about CGT implications for when you do sell (including your main house)
- As others have said, look at property taxes as it can vary wildly
- US living can be amazing but you need to go and get into a social group or 2 and not be seen as planning to leave in a year or so
- Healthcare will likely be provided with your job but you should try to understand how deductables work how your medical pot can be used
- watch out for US holidays .... I negotiated a UK amount
If you are moving back you need to know the rules on shipping goods back and the tax implications of that (My company had a big bill when I moved back to the UK)
Its an amazing place to live and work but it's very different
- The move is expensive, so you really want someone to pay for you to get there
- Depending upon your visa, your partner may not be able to work for 6 months, (This was true with my L1 visa and my wife's L2) (Other visa types are available)
- You will need to work out your residency for tax purposes and be very clear in your declarations
- If not selling your houses, think about CGT implications for when you do sell (including your main house)
- As others have said, look at property taxes as it can vary wildly
- US living can be amazing but you need to go and get into a social group or 2 and not be seen as planning to leave in a year or so
- Healthcare will likely be provided with your job but you should try to understand how deductables work how your medical pot can be used
- watch out for US holidays .... I negotiated a UK amount
If you are moving back you need to know the rules on shipping goods back and the tax implications of that (My company had a big bill when I moved back to the UK)
Its an amazing place to live and work but it's very different
LondonWorker said:
Thanks, these are really useful points.
I will admit the main drivers are (a) higher salary sounds nicer, and (b) the fact that you get bigger houses (quality of construction notwithstanding).
A word of caution. Do not get into the criticism spiral that many who come over here do. It will not make your transition smooth, I will admit the main drivers are (a) higher salary sounds nicer, and (b) the fact that you get bigger houses (quality of construction notwithstanding).
Also, a lot has changed in the US home market and construction. Building techniques/approaches are different in the US to the UK and may seem temporary as a result. They also vary depending on the environment the house is built in. Codes are very strict and inspections during the building process are constant. I had a deck built in 2013. I had to have planning permission/approval and it was inspected 3 times during construction.
This is my current house. The siding may appear to be wood but is actually fiber cement which comes with a 30 year warranty.
The US used to build inefficient houses because energy was cheap. Today, codes have been updated and now houses have to be very efficient. My house goes through temperature swings from around -20C to 48C
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