LeavingLondon

Hi, thinking about moving to San Jose, California (husband has been potentially offered a job, about to negotiate package). Am trying to work out if we can afford it long term on his monthly salary and what the costs of moving (that we would be responsible for) would be as don't want us to be crippled financially the minute we step off the plane). So I'm just trying to make a list of significant additional costs/cost increases which will arise from our move (2 adults and 2 elementary-age kids) - I'd appreciate any input/advice on my projected costs (and anything else i may have missed out)

Initial outlay

• 2 x low mileage/second hand cars (as won't be able to cover that from the sale of our cars in UK) - $24,000 (approx)
• Food, travel and accommodation for the first month (presumably part of the company' relocation package)
• 2 month's rental deposit - $3600 (approx)
• Replacement of 2 x TVs - $1000
• White goods (not sure if that'll be included in the rental) - Allow $2000?
• Anything else???

Additional monthly expenses

• Difference between my monthly mortgage vs US rental - $800
• Health care/dental/eye (hopefully included within the package)
• Taxes - will this have a significant impact on our monthly outgoings compared with the UK? Not sure in general how monthly income tax (federal and state taxes/Roth/441K/Medicare, Social Security etc) compare with the income tax/NI in the UK?
• Anything else?

Thanks!

lisa67

Sorry, can't really comment on your numbers because I don't know the area but have you included car insurance?
Also, if health insurance isn't included in the company's package, walk away. Even if it is you need to know the co pay amount (we pay $25 for each Dr visit etc.) because that can soon add up as can prescription charges if the health insurance plan doesn't include that.

md95065

Rentals will normally include a stove, refrigerator/freezer and possibly a dish washer - a clothes washer and dryer may or may not be included.

Most (almost all) rentals are unfurnished so you will need to factor in the cost of new furniture or shipping across your existing furniture (shipping probably only makes sense if it is included in the relocation expenses).

You will also end up buying lots of small appliances - kettle, toaster, microwave, vacuum cleaner etc as well as pots and pans and dishes and cutlery (unless you ship those across).

For a rental, expect to have to come up with 2 x the monthly rental ("first and last") and a security deposit. If your monthly rental is $2000 then $5000 would be closer for this rather than the $3600 you mentioned.

As was already mentioned, don't forget to factor in the cost of car insurance.

Since you won't have any US credit history you should expect to have to pay deposits of a few hundred dollars each when establishing various accounts such as gas/electricity, cable, cell phone contracts etc.

HarryTheSpider

The taxes can be misleading on the surface.

Not long after arriving here a colleague asked me how we were enjoying the low tax environment. The tax rates on income are lower in the US. I told him for us it's about the same effective rate, which surprised him & he asked why.

I told him that the single biggest difference is medical cover. In the UK my tax covered this. Whilst our employer provides a fantastic medical scheme, it is not the NHS. So I cranked up our cover a little, mainly in respect of the Other Half. With our excellent medical cover we still had out of pocket expenses of quite a few grand. We both have minor issues, but having these treated still chewed up co pay, co insurance, hospital visits etc.

Also the cost of fuel here is more than you think when you consider usage. The price is lower sure, BUT the US gallon is some 17% smaller and your typical US car is a gas guzzler. The most recent models are starting to get pretty good, to be fair.

Certain foods are not as cheap as you'd think. Also the cost of electricity is about 20% more per unit for us than back home. We live in Phoenix, AZ. San Jose is a little different I believe. Our main power station is 94 billion miles away, and infrastructure costs when divided between a population that is a tenth of the UK one means the cost per home has to be higher... That said, meat and certain veg are way cheaper.

If you are going to be in temporary rented accommodation while waiting for your belongings to arrive from the UK, and while looking around for a permanent place to live in, either rented or purchased, know that you should allow 2 months for your stuff to arrive and get cleared through customs. And know that such short term rent will be some 2.5 to 3 times typical rental costs. Also $1800 in San Jose won't get you anything big. Get these initial costs included in your package, along with having your first year tax returns done professionally and paid for by the employer, and also for your final year tax returns just before you leave the US.

Depending on visas, if coming on L1/L2 get the employer to pay for your EAD which is the work permit for you. It's around $380.

Factor in state & local sales tax in everything too.

You'll need a rental car for the first few weeks whilst you sort yourselves out with your own, so get that included.

If I have forgotten anything, somebody will be along soon to fill in the gaps.

Good luck!

LeavingLondon

Calculated the rental totally wrong (brain freeze) - I meant two month's rental at approx $5500-6000!

Bob

Low mileage, for anything with less than 80K on the clock a piece? Unless meh cars, possibly on the low end of things.

Deposit on rental, probably more than that because you've usually got to pay first and last as well. Most rentals include washer/dryer, but not all do, fridge/cooker included, microwaves etc shouldn't be to much.

Deposits on each utility, anything from $50-600 a piece.

Car insurance will be pricey too.

Don't presume anything in the relocation package, if it's not stated in writing it means nothing.

md95065

Also, don't forget that the advertised "sticker" price for everything that you buy (including cars) is net of sales tax which, in your case, will be about 8.5%.

For budgetary purposes just assume that sales tax will be another 10% on top and be pleasantly surprised when it turns out to be slightly less than that.

There are also some other fees associated with purchasing a vehicle - prices are always quoted as being "plus tax, licensing and documentation fees" - in practice this means that, in California, if you negotiate a purchase price of $13,500 for a car you will end up paying about $15,000.

LeavingLondon

Thanks. Am re-looking at cars. Am guessing car insurance will be more than we pay now as we'll have no "no claims bonus" (do they have that in the States?)

Agree re relocation package. Not taking anything for granted and will get everything in writing but for the moment I'm making certain assumptions whilst waiting for clarification.

I'll call around realtors tomorrow to get a better idea of rental prices now that I've a better idea of the kind of schools I'm looking at and areas.

Bob

Car insurance, expect $1K per 6 months of coverage, per car and be happy if it is less, for new cars and decent levels of coverage, it's just a general rule of thumb, because you have zero US credit history and zero US driving history, you start out one step above a spotty 15 year old.

If you're using a realtor and the company doesn't pay them, expect anything from 1-3 months rent as a fee that you have to pay them and if you're signed a contract with one, you might have to pay them even if you found something privately, so do double check the contract. This all depends on the rental market, but anywhere which has a good rental market, you usually pay the fee, if it's not a good market the owner pays.

padmapper.com is a good site to check out as it pulls info from various realtor sites in the area, craigslist and others too and sticks them on google maps.