Moving to Lower COL Area to Ramp Up Savings? For Dev Associate Gig

Curious to hear community's thoughts on moving to a lower cost-of-living area with the goal of seriously ramping up savings to then use for one's own deals? Currently living/working in tier 1/2 metro at a regional developer (nearly $1b in development pipeline) and received a very competitive offer for a smaller, state/local developer back in hometown ($200mm in pipeline).

Offer is $110-120k base to join as an Dev Associate (they can't find any talent back home), which is effectively $160k+ (when adjusting for COL) in my current city.

Biggest dilemma is whether I'm being too short sighted (only mid-twenties) to think it might make sense to move? For more context, my long-term gf is graduating pharm school in May and will likely be making six figures, so together we can save a ton if we move back to our hometown. That being said, my qualms are lack of transactions in hometown, appearance of taking a "step down" in my career, weaker networking opportunities, and potential future earnings/jobs that aren't as plentiful in a smaller market.

Also recently joined the firm I'm at (< 1 yr) and am loving the job/learning a lot, but am practically saving nothing despite making $80k base + bonus due to COL, inflation, car payment/student loans, etc. Would likely burn bridges with the firm I'm at and recruiter that place me, so that's another thing to note. Ultimately though, like many on this site, I want to do my own deals as soon as possible, so maybe this is a more direct path to achieving that.

What's your thoughts?

Comments (5)

Nov 28, 2021 - 10:10am

Have you crunched the numbers? I mean how much more are you going to save per year, realistically, and how will that help you do your own deals? Is it really going to make a difference if you have $200k or $350k saved? Just seems kind of short sighted to make a move to a location you seem to have a lot of reservations about, based on that fact that you can save more to maybe do your own deal one day. Everyone says they want to do their own deals how many actually do?

My advice as someone who has moved coast to coast and lived a few different places is go where you will be happier and somewhere you see yourself long term. I think being happy should be your priority. When you're happier in your job/where you live, and you stay in that place longer, your work will be better, relationships will compound, etc.

  • Associate 1 in RE - Comm
Nov 28, 2021 - 12:15pm

Sorry I just re-read. You're going from $80k all-in to $110k base? What's the all-in at the new job? If you're making $50-$70k more all-in and lowering COL, it could be worth it. But only if the new job isn't hindering your career progression.

We don't really have enough details to know the extent that it might hurt your career 

Nov 28, 2021 - 12:46pm

I think you're being penny wise, and pound foolish.  Or at least, this attitude is.

What do you want from your career?  That's the important question.  Are you better place where you are?  Obviously dollar value of the pipeline isn't the same as expected work, but it sounds like your current employer is better situated for the near future.  

Put differently, few people on these boards are aiming to save 25k a year and retire in 40 years with a few million bucks in the bank as their retirement.  Honestly, that might be the end truth for most of us, but no one wants that as a ceiling.  But that is the gist of what you're saying.  You're willing to give up future upside and career progression for the sake of a few thousand dollars in annual savings.  I'm not ever going to criticize the desire to save money and have a rainy day fund, but it is a question of priorities.  I'd also argue it's tough to say you have a handle on what your current earnings potential is if you haven't even been around for a single year.

EDIT: missed the bit where you say you want to do your own deals.  When?  In a bigger market, at a bigger developer, you'll get more exposure to potential equity partners, investors, etc.  By definition there is more opportunity.  In the smaller market, you might be able to carve out a good regional business (as it sounds like you're prospective employer has done), but it might be harder to fund it without dipping into all your hard earned savings.

I guess the point still stands, that unless you have very narrow goals, choosing a (relatively) marginal increase in savings over an optimal career path seems shortsighted in the extreme.

Most Helpful
Nov 28, 2021 - 1:46pm

I would only recommend a move like this all of the below are true...

1. You WANT to live and work in this city long-term (going back "up" can be very difficult if you jump "down" at such a junior level)

2. Your strategy of "doing own deals" is fixated on small stuff (this is easier in smaller markets of course), otherwise the extra dollars saved won't make much of a difference (frankly, accumulated savings are only of value for salary replacement, basic business start-up costs, small share of pursuit costs).. you will need capital/partners (even if family).... unless you want to do like duplexes and stuff like that. 

3. You want (or at least okay with) the career path this firm (and its peer set offers)... now the truth is you can maybe shift upwards, but can't count on and may be more difficult (like it is not something to just take for granted). This is really the most important, don't take this job unless you actually WANT this job. 

To echo Ozymandia's point... this could be "penny wise, and pound foolish". Worrying about savings for this purpose before you even have the skill set, track record, and network to raise fund and execute is definitely the wrong set of priorities. Again, if you just want to buy duplexes and the like, may be a great strategy (like the Bigger Pockets kind of stuff). But if you want to legit commercial, let alone institutional, style deals.... your marginal savings is the most meaningless. Get to where you have six figure bonus payouts and save it all. Just be frugal and not stupid (you don't have to live that expensively in big cities, trust me, I'm an NY'er... you have choices). If you really are going to marry this long-term gf then you shouldn't care about the ability to bring someone home and impress them. Find the cheap but acceptable part of town, take the train, and save (people do this, city is not an excuse). 

Dec 23, 2021 - 5:21pm

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