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Will I be earning enough?

Will I be earning enough?

Old Apr 9th 2014, 11:50 am
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Default Will I be earning enough?

Hi Expats and sorry for the long post!

I work for an elearning company here in the UK and will be moving to Chicago in less than month on an L1 (L2 for my wife) visa.

We are a small company and so I have been offered what I think is a reasonable package for the time being but want to get views on this.

I am 28 years old, renting with my wife in Oxford and earn £25k currently. We have around £18k savings ready for a house and my company suggested a move to USA as we do a decent amount of business out there. I have worked for them for 2 years.

I have a degree and was a web developer/elearning developer but have transcended into a kind of sales role. Small company means I do a lot of different things!

They have basically offered me:

- $40k basic salary
- $5k for business costs (laptop phone etc). includes money towards our sister companies office where I will be working from.
- $5k health insurance
- $5k housing contribution
- $5k travel costs
- extra commission based on revenue

My wife will be working too but has no job confirmed just yet.

So after looking at another thread on this site that seems low although they were discussing California which I know is pricey.

When I did my research before we could get a nice apartment for $1,500 per month which is only slightly more than we pay for a 1 bed in Oxford. The health insurance looked like roughly $400 for basic cover so maybe I am missing a reason we need to be earning more?

We plan to view how the business is going after a year which is when I can ask for more money.

My thoughts are that we are sacrificing time (through hard work!) and money for a future in a country we both love. Short term sacrifice for long term gain?!
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Old Apr 9th 2014, 12:10 pm
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Default Re: Will I be earning enough?

Sounds low to me, unless you're expecting bonuses and/ or commission payments of at least $10k/ yr, or there is scope for steady salary growth.

The headline cost of medical insurance is only the start of overall cost. If you are in good health and don't need medical care regularly then you'll be fine, but there are multiple other costs to visiting a doctor and filling a prescription, including copays, deductibles, and "out of network" costs.

Your utility bills are certainly going to be higher in Chicago too, because it is unbelievably cold in winter, and much hotter than the UK in the summer, so you'll be using air conditioning in the summer; even for a small apartment you should budget $100-$120/ mth for electricity (including gas if it has gas heating). If you have any choice of apartment, choose one that is surrounded on both sides and above by other apartments, with north facing windows, so you'll be insulated summer and winter by your neighbors, and not get heated by the sun in the summer.

Your wife will need an EAD before she can work, so don't expect her to be working until 2-3 months after you arrive.

Last edited by Pulaski; Apr 9th 2014 at 12:26 pm.
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Old Apr 9th 2014, 12:13 pm
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Default Re: Will I be earning enough?

Originally Posted by Pulaski View Post
Sounds low to me, unless there are bonuses and/ or commission payments, or there is scope for steady income growth.
My target to start with is just to make the cost of me being there! Then I get commission on anything over that. The basic example given to me would give me a $10k bonus per year on quite feasible figures.

A lot of the revenue will be on a monthly basis so that will grow and grow over time which will mean for easier bonuses!
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Old Apr 9th 2014, 12:29 pm
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Exclamation Re: Will I be earning enough?

As you are only 28 (not sure how old your wife is) then I assume that you may be planning to have children in the not-too-distant future?

If so, it is essential that good maternity coverage is included in your health insurance plan - some policies don't cover maternity until after 10 months of signing up to the plan. Btw - contraception is not free in the USA....

Your wife might even want to have a baby sooner than you think when she finds out how awful the annual leave and maternity leave is in the USA....it is quite possible/likely that she may only get up to 10 days annual leave (inc. sick days) in her first years of employment...


http://www.babycenter.com/0_maternit...-basics_449.bc

http://www.huffingtonpost.com/2013/0...n_2617284.html

Last edited by Englishmum; Apr 9th 2014 at 12:40 pm.
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Old Apr 9th 2014, 12:35 pm
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Default Re: Will I be earning enough?

Originally Posted by Englishmum View Post
As you are only 28 (not sure how old your wife is) then I assume that you may be planning to have children in the not-too-distant future?

If so, it is essential that good maternity coverage is included in your health insurance plan - some policies don't cover maternity until after 10 months of signing up to the plan. Btw - contraception is not free in the USA....

Your wife might even want to have a baby sooner than you think when she finds out how awful the annual leave and maternity leave is in the USA....it is quite possible/likely that she may only get up to 10 days annual leave (inc. sick days) in her first years of employment...


http://www.babycenter.com/0_maternit...-basics_449.bc
She 24 and we both wants kids one day (she would have them right now!)

The health plans we have seen put basic insurance at around £260pm without maternity and £410 with it so I thought we would stick to basic cover for a few years until we are ready to try for a baby then go onto the better plan.

The pill isn't free in the US?! Don't know why I didn't think about that before. Hopefully not too expensive lol
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Old Apr 9th 2014, 12:37 pm
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Default Re: Will I be earning enough?

I have added some questions and comments below, as it depends ...


Originally Posted by delbitter View Post
Hi Expats and sorry for the long post!

I work for an elearning company here in the UK and will be moving to Chicago in less than month on an L1 (L2 for my wife) visa.

We are a small company and so I have been offered what I think is a reasonable package for the time being but want to get views on this.

I am 28 years old, renting with my wife in Oxford and earn £25k currently. We have around £18k savings ready for a house and my company suggested a move to USA as we do a decent amount of business out there. I have worked for them for 2 years.

I have a degree and was a web developer/elearning developer but have transcended into a kind of sales role. Small company means I do a lot of different things!

They have basically offered me:

- $40k basic salary [seems quite low
- $5k for business costs (laptop phone etc). includes money towards our sister companies office where I will be working from. What happens if that isn't enough? Will you have to dip into your own pocket?
- $5k health insuranceMay not cover your expenses, especially if you have children. Be aware that health insurance does not cover all of your health are costs, it only covers a portion of it. I would ask them to identify the company and policy that they will fund (what happens if the premiums go up in year 2?), and read the associated documentation very carefully.
- $5k housing contribution What exactly does this mean/ $5k cash to spend as you wish, e.g., on rent or a deposit on a home?
- $5k travel costs Again, what does this mean? Relocation costs/ Or work-related travel costs? If the latter, what if your work-related travel costs go above $5k?
- extra commission based on revenue

My wife will be working too but has no job confirmed just yet.

So after looking at another thread on this site that seems low although they were discussing California which I know is pricey.

When I did my research before we could get a nice apartment for $1,500 per month which is only slightly more than we pay for a 1 bed in Oxford. The health insurance looked like roughly $400 for basic cover so maybe I am missing a reason we need to be earning more?

We plan to view how the business is going after a year which is when I can ask for more money.

My thoughts are that we are sacrificing time (through hard work!) and money for a future in a country we both love. Short term sacrifice for long term gain?!
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Old Apr 9th 2014, 12:53 pm
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Default Re: Will I be earning enough?

Originally Posted by dunroving View Post
I have added some questions and comments below, as it depends ...
Thanks for that, I should have gone into a bit more detail probably. So these figures are based on the 1st year alone and will increase if they decide to keep me out in the US and providing we want to. As long as the business produces at least a small profit and we like it we will try and stay as long as possible and apply for green cards at this stage.

The housing contribution is towards our rent.

The travel costs don't include travel back to the UK so that should not be an issue with the quite low amount of travelling I forsee.

The basic health plan is something I wanted us to have for just a year and then increase if we stay.

$40k basic salary [seems quite low
- $5k for business costs (laptop phone etc). includes money towards our sister companies office where I will be working from. What happens if that isn't enough? Will you have to dip into your own pocket?
- $5k health insuranceMay not cover your expenses, especially if you have children. Be aware that health insurance does not cover all of your health are costs, it only covers a portion of it. I would ask them to identify the company and policy that they will fund (what happens if the premiums go up in year 2?), and read the associated documentation very carefully.
- $5k housing contribution What exactly does this mean/ $5k cash to spend as you wish, e.g., on rent or a deposit on a home?
- $5k travel costs Again, what does this mean? Relocation costs/ Or work-related travel costs? If the latter, what if your work-related travel costs go above $5k?
- extra commission based on revenue
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Old Apr 9th 2014, 1:06 pm
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Default Re: Will I be earning enough?

Well although it doesn't answer the exact question you asked, at your age I would have jumped at a chance like this. The money seems do-able, though not fantastic. (I am a bit out of date with cost of living in the US these days, as I left in 2006.

Because it is a company move, if things don't work out you have a job back in the UK so there's your escape route. Some people emigrate with no support, no job lined up, etc. and take on huge risks.

So in the big scheme of things this looks like a huge adventure with many guarantees and the support of your employer. And how many people get to have a huge adventure these days???

Originally Posted by delbitter View Post
Thanks for that, I should have gone into a bit more detail probably. So these figures are based on the 1st year alone and will increase if they decide to keep me out in the US and providing we want to. As long as the business produces at least a small profit and we like it we will try and stay as long as possible and apply for green cards at this stage.

The housing contribution is towards our rent.

The travel costs don't include travel back to the UK so that should not be an issue with the quite low amount of travelling I forsee.

The basic health plan is something I wanted us to have for just a year and then increase if we stay.

$40k basic salary [seems quite low
- $5k for business costs (laptop phone etc). includes money towards our sister companies office where I will be working from. What happens if that isn't enough? Will you have to dip into your own pocket?
- $5k health insuranceMay not cover your expenses, especially if you have children. Be aware that health insurance does not cover all of your health are costs, it only covers a portion of it. I would ask them to identify the company and policy that they will fund (what happens if the premiums go up in year 2?), and read the associated documentation very carefully.
- $5k housing contribution What exactly does this mean/ $5k cash to spend as you wish, e.g., on rent or a deposit on a home?
- $5k travel costs Again, what does this mean? Relocation costs/ Or work-related travel costs? If the latter, what if your work-related travel costs go above $5k?
- extra commission based on revenue
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Old Apr 9th 2014, 1:12 pm
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Default Re: Will I be earning enough?

Depending on how it's classed some of those extras may be taxed at around 40%. I would also figure around 25% of the salary going to various taxes. Decent food for two and the odd alright meal out could run you $150 a week depending on what you get. General bills, including everything, could be around $500 a month. There are a lot of hidden expenses and taxes here, $40k salary in Chicago sounds very low but with a dual income and the extras you will probably be able to survive and do some stuff. I doubt you'll be living the high life but you wont be on the poverty line. You may struggle until you have a dual income though.
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Old Apr 9th 2014, 1:16 pm
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Default Re: Will I be earning enough?

Originally Posted by Duncan Roberts View Post
Depending on how it's classed some of those extras may be taxed at around 40%. I would also figure around 25% of the salary going to various taxes. Decent food for two and the odd alright meal out could run you $150 a week depending on what you get. General bills, including everything, could be around $500 a month. There are a lot of hidden expenses and taxes here, $40k salary in Chicago sounds very low but with a dual income and the extras you will probably be able to survive and do some stuff. I doubt you'll be living the high life but you wont be on the poverty line. You may struggle until you have a dual income though.
Yeah we live quite a "frugal" lifestyle at the moment so I think we can live off of quite low amounts of money. Because my wife doesn't not have a job they have paid for an apartment for the first two months up front which is handy!

Originally Posted by dunroving View Post
Well although it doesn't answer the exact question you asked, at your age I would have jumped at a chance like this. The money seems do-able, though not fantastic. (I am a bit out of date with cost of living in the US these days, as I left in 2006.

Because it is a company move, if things don't work out you have a job back in the UK so there's your escape route. Some people emigrate with no support, no job lined up, etc. and take on huge risks.

So in the big scheme of things this looks like a huge adventure with many guarantees and the support of your employer. And how many people get to have a huge adventure these days???
This is exactly what we have been thinking!

It is an amazing chance for us and we don't have much going for us here in the UK. The house prices actually made us question whether buying a home here was worth it or not and then this came along. £200k first home would get us a crap terraced house in a poor area!

They are great people I work for so often offer help for the move and have said if it doesn't work out we can come back.
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Old Apr 9th 2014, 1:30 pm
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Default Re: Will I be earning enough?

Originally Posted by delbitter View Post
Yeah we live quite a "frugal" lifestyle at the moment so I think we can live off of quite low amounts of money. Because my wife doesn't not have a job they have paid for an apartment for the first two months up front which is handy!



This is exactly what we have been thinking!

It is an amazing chance for us and we don't have much going for us here in the UK. The house prices actually made us question whether buying a home here was worth it or not and then this came along. £200k first home would get us a crap terraced house in a poor area!

They are great people I work for so often offer help for the move and have said if it doesn't work out we can come back.
I should have added - in fact I did something like this, way back when I was 25 years old (a rather long time ago, before the internet and information accessibility so it seemed even more of a leap into the dark than maybe this is for you). That decision ultimately change my life completely, in many ways.

The only slight regret I have in retrospect was not saving/investing into a pension back then (the power of compound interest!!!) - I presume your company will continue to pay into some sort of pension scheme for you?

It might be worth asking whether this will be in the US or the UK ... this has potential implications for complications later on!!
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Old Apr 9th 2014, 1:40 pm
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Default Re: Will I be earning enough?

Originally Posted by dunroving View Post
I should have added - in fact I did something like this, way back when I was 25 years old (a rather long time ago, before the internet and information accessibility so it seemed even more of a leap into the dark than maybe this is for you). That decision ultimately change my life completely, in many ways.

The only slight regret I have in retrospect was not saving/investing into a pension back then (the power of compound interest!!!) - I presume your company will continue to pay into some sort of pension scheme for you?

It might be worth asking whether this will be in the US or the UK ... this has potential implications for complications later on!!
They will match my pension contribution, in fact we have been talking about it recently. I wanted to wait a year until we decide which country we will be staying in before commiting to a pension. I do have a small one already which I started when I was 18! So I will carry that on in the future although I HATE pensions because of the bad experience my dad had. I have been looking at SIPP options instead so I at least have more control over my pension but again I think I want to get my head down for a year and see what happens.

If the business makes no money or we hate it we will be coming back but I cannot see that happening!
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Old Apr 9th 2014, 1:50 pm
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Default Re: Will I be earning enough?

You do realize that being on a L1 visa you'll be stuck with the company? Meaning if you find a better opportunity with better pay in the US you won't be able to switch?
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Old Apr 9th 2014, 1:53 pm
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Default Re: Will I be earning enough?

Originally Posted by delbitter View Post
They will match my pension contribution, in fact we have been talking about it recently. I wanted to wait a year until we decide which country we will be staying in before commiting to a pension. I do have a small one already which I started when I was 18! So I will carry that on in the future although I HATE pensions because of the bad experience my dad had. I have been looking at SIPP options instead so I at least have more control over my pension but again I think I want to get my head down for a year and see what happens.
If the business makes no money or we hate it we will be coming back but I cannot see that happening!
I understand where you are coming from and I feel the same way (maybe not so strongly!) about the financial sector in general because of mis-selling of almost any financial product you can name (mortgages, pensions, endowment policies, unit trusts).

However, I am going to put my preachy hat on and say if you do not consider this at the moment (not in a year!) you are almost literally throwing thousands of dollars down the drain!

When you say that "They will match my pension contribution", do you mean they will pay you an amount similar to what you are paying into pension now, as salary? Or are they saying if you pay into a pension, they will pay an equal amount? If the latter, take it, and pay in as much as you can afford.

I won't go into the detail, and I am sure one of our pensions/tax experts will likely jump in at some point and give you advice. However, I'd say don't put off thinking about this or doing anything for a year. Your employer is offering to give you money for nothing! Take it! If you pay just $4,000 into a pension, your take-home pay will only be lower by about 80% of that amount (I am not familiar with US income tax rates these days), plus, your employer will pay an additional $4,000! That's the same as a $4,000 pay rise ... but you are going to put off making a decision for a year ... think about it.

OK, off my soapbox, just saying that when I was your age, pensions were Boooorriiinnnggg with a capital B ... but now they are not boring at all, and I wish I had put more effort into investing way back.

BTW, if you are living in the US, I don't think you can pay into a UK SIPP - or if you do, you won't get the tax relief on your contributions.
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Old Apr 9th 2014, 2:10 pm
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Default Re: Will I be earning enough?

Originally Posted by delbitter View Post
I have a degree and was a web developer/elearning developer but have transcended into a kind of sales role. Small company means I do a lot of different things!

They have basically offered me:

- $40k basic salary
The general rule of thumb is to double your UK salary and ask for that in USD.

FWIW: I would not move to the US on a $40k salary.
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