The San Francisco Bay Area has held an allure for centuries, and despite enduring many natural catastrophes over the past 100 years, has still managed to continuously rebuild and reinvent itself. That doesn’t mean that the present-day challenges of life in San Francisco are no less real for those who choose to make it home. State, local, and sales taxes, homelessness, and the scarcity of available public resources are tangible any given day. However, those that love “The City,” as it’s called, learn to forgive its flaws and adapt.
Several major tech and start-up firms have made the South of Market (SoMa) district their home. Companies like Twitter, Google, and Riverbed Technology have transformed the once quiet neighborhood into a busy tech hub of high rises with beautiful parks intermingling the surrounding neighborhoods below. It’s a great place to work and then head over to Salesforce Park afterward to relax. This is only one example of a neighborhood that has undergone some dramatic change.
The booming tech industry has altered the Bay Area drastically, and for some, it has not been a welcome sign of progress and ingenuity to everyone because it has come at a cost. One, namely, is the exodus of the middle class. Those who live in San Francisco and especially those families that want to raise children in the Bay Area need to be rigid about financial planning and spending. The cost of living is high; there isn’t a lot of room for emergencies, such as the loss of a job. Sound wealth management in San Francisco is truly a necessity. Here are 7 key things to keep in mind when it comes to financial planning in the area.
Competitive landscape of jobs and homes
- Competition is fierce
If you’re recently becoming established in the San Francisco Bay Area, it could mean making some sacrifices early on to ensure your long-term success. Highly desirable companies mean that you can expect the job market to remain competitive for a long time, but you will have to be willing to dive headfirst into these highly competitive situations. Not only are you competing for jobs, you are also competing for housing, which is always in short supply in San Francisco. Proper wealth management in San Francisco will be a large part of your success.
When you take the appropriate steps to save and invest, then you have prepared to wait until the best jobs open. If you have reserves and happen to find yourself in a job you don’t like, you don’t have to stay. Much like your job, you will be prepared to upgrade your living space when the opportunity presents itself.
Wealth management strategies and ways to save
- Parking and transportation costs
Low income as defined by Housing and Urban Development (HUD) for San Francisco and Marin counties in 2018 was approximately $117,000. If you make $125,000 per year, is it still worth owning that car if you’re paying $400 per month for a parking space in the Financial District? That’s one example. If you live in the East Bay Area and you drive to work, consider taking the BART and read on your way to work instead.
- Employee discount programs
Companies work closely with city services and other local businesses to establish partnerships that offer discount programs to their employees. Employee orientations are rigorously organized to get you ready to perform at work, not to teach you every discount for which you’re eligible. Sometimes it may be as much as a complimentary ticket to the art museum; that’s free entertainment. Find out what you’re missing. Managers do not know all these details. Check online under employee benefits or call your human resources (HR) sponsor.
- Additional employee benefits
Employers in San Francisco want to hire and retain the best talent and, therefore, offer competitive benefits packages. Gym membership discounts are one example. Some companies offer special lending rates or terms for qualified home and auto loan applicants. When you earn a yearly bonus, pay off a credit card or park it in a six-month certificate of deposit (CD) if you think you may need it in a year.
- Earning bonus points to travel
Earn bonus points by making purchases with your credit card and use the travel points you earn towards airline tickets. Be sure to pay down your balance with cash soon after. Being creative in controlling how much you spend will allow you to invest in more than your retirement account. You will thank yourself if you’re raising a family.
School systems and families
- Public school vs. private school
Public school assignments for San Francisco residents are made through a lottery system. They are among the highest and lowest-ranked in the state, which means the quality of the school where your child gets assigned is a toss-up. Private schools cost about $20,000 for elementary school and $30,000 for high school. Combine these expenses with the cost of living, and things can really add up. Careful wealth management in San Francisco will shape the future of your family. If you choose to enroll them in private school, you will need a college savings account.
Choosing a professional wealth manager
- Prepare for success
Dealing with many different variables that can affect your finances every day, it can be tough to stay on task in your financial planning. But it can be done. The cash-intensive requirements that come with living in the San Francisco Bay Area make it crucial to put forth a solid plan early on. SD Mayer is one of the best local wealth management firms. They have decades of combined experience and a full-service office conveniently located in the Financial District. Careful planning with an experienced professional can set you up for success.
The San Francisco Bay Area is vibrant and wonderful—we love it here, and our SD Mayer wealth managers have been providing their expertise to local clients for decades. If you are starting out in the area, we can work with you to get a solid financial plan in place so that you can enjoy all that SF has to offer. Contact us today to get started with an initial consultation.
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SECURITIES AND ADVISORY DISCLOSURE:
Securities offered through Valmark Securities, Inc. Member FINRA, SIPC. Fee based planning offered through SDM Advisors, LLC. Third party money management offered through Valmark Advisers, Inc a SEC registered investment advisor. 130 Springside Drive, Suite 300, Akron, Ohio 44333-2431. 1-800-765-5201. SDM Advisors, LLC is a separate entity from Valmark Securities Inc. and Valmark Advisers, Inc. Form CRS Link
DISCLAIMER:
This material has been prepared for informational purposes only, and is not intended to provide, and should not be relied on for, accounting, legal or tax advice. The services of an appropriate professional should be sought regarding your individual situation.
HYPOTHETICAL DISCLOSURE:
The examples given are hypothetical and for illustrative purposes only.
