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 n recent months, with the steep unprecedented ascent in the price of the dollar and the subsequent devaluation of the Indian rupee, the US has further plumed its attractions as a career destination for Indian techies. Grossing an average annual salary of $ 40,000-60,000, (Rs 18,00,000-27,00,00) depending on the company, the nature of the job and the geographical location, IT pros are well on the way of realising the current pan-national dream of becoming crorepatis ( if one believes KBC’s TRP ratings). But quite often fantasies precede and preclude reality.
Many IT pros forget that earning in dollars also means spending in dollars. I can vouchsafe for techies whose dream jobs and dream salaries in the US became killjoys merely because they have worried, sighed, anguished, moaned and lamented over every dollar they had to shell out and others (although they are in a minority) who in the first heady intoxication of earning actual green bucks woke up months later with a painful hangover of not having saved enough. To prevent incumbents from the temptations of either two extremes,
AssureConsulting.com plays Mammon’s advocate by helping techies budget their monthly cost of living and maintain a more than decent standard of living with saving precious green bucks.
In this article, a basket of items - rent, utilities,
groceries and travel - has been used to define the monthly cost of living. Rather than actual figures, which depend on tangible variables, such as area, government imposed taxes etc, the article provides cost ranges of various items to provide a fair idea of living costs in the US.
| Snappy Tips for Renters |
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Does the apartment have enough natural light? |
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What kind of closet space is available? |
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What is the condition of the floor? |
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How many electric and phone outlets does the apartment have?. |
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Are wall hangings permitted? |
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What is the condition of the refrigerator? |
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What is the condition of the toilet? |
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Are the walls soundproof? |
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Are laundry facilities available in the building |
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What is the condition of the elevator |
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The distance of the gym and the grocery store from the apartment? |
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Do you have roof access? |
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What kind of parking space is available? |
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RENT: Costs vary depending on the state and the city. I recommend that you do not spend more than one-third of your monthly income on rent. For a studio apartment (one bed room apartment), the approximate rents are $800 to $1,000. As you move away from the city center, (known as the downtown area) you will notice a reduction in downtown prices. In the Bay area, rentals are 40 to 50 per cent higher than other States, averaging $1,500 According to a
siliconvalley.com report, “renters pay the steepest price in the Silicon Valley.” In certain places, rents can be as high as $1,500.
If your family is not accompanying you, it would be more economical to share an apartment. You can post your requirement for a room mate on a number of online sites like
apartments.com. The site will also provides detailed information about rental costs in various US cities.
After your visa has been approved and before you actually go to the US, take time off to visit certain online apartment sites. Use search engines and type apartments for rent or related words. Some good sites are
homefair.com and 100topapartmentsites.com. Certain sites even provide virtual tours of the apartment. This will prepare you in advance on what to expect. The more aware you are, the better your choice and the heavier your pocket. FURNISHING THE APARTMENT: In the US, it is obligatory on the part of the apartment owner to provide a refrigerator and an electric stove. You can opt for a furnished apartment, but the rents are high and I would not recommend this to anybody going there for a brief period. They are three basic ways in which you can furnish your apartment:
BUY NEW FURNITURE: An expensive proposition. Recommended, only for those ready to compromise on their savings without cribbing.
RENT FURNITURE: An easy in-between option for those who do not want to buy new furniture and are not adventurous enough to hunt for second hand stock. The rental agency will charge around $ 200 –250 per month. If you opt for renting furniture. do take renter’s insurance. In case of any damage to the furniture, your insurer will pay for it. You will have to pay approximately $20 a month depending on the package you opt for.
BUY SECOND HAND FURNITURE: (Highly recommended and least expensive.) You will be able to pick up second hand furniture at a consignment stores (resale or second hand stores) at very economical prices. For instance, a dining table and chairs will cost around $ 25-40. The total cost will not exceed $500.
Another good place to pick up secondhand furniture is garage sales. When you are taking a walk in the neighborhood, keep you eyes open. You might find a notice of a garage sale in front of a house or at the local grocery store. Garage sales are conducted by people who are shifting to another locality and the prices are a fraction of the market rates. You will be able to furnish your house at throwaway prices. However, if you plan to buy furniture at a garage sale reach early in the morning, before somebody else beats you to it.
BUYING A CAR: The golden rule of buying furniture holds even for buying a car. Always buy second hand. To get local information about second hand cars, look up the local papers or can go through the Internet local pages. On Yahoo, select local states, choose your state and go through the classifieds.
A secondhand car in good condition is available in the US for $5,000. Do not become miserly and select a $2,000 model. You may have to spend an equivalent amount on repairs. You do not have to make the entire payment at once but can pay off the amount in monthly installments. If you are in the US for a year, at the end of the period you can sell the car for $3,000. So the actual cost will not be more than $2,000.
Before you buy the car ask yourself?
Do I really need the car?
How far is my office located from the apartment complex?
Can I become a member of an existent car pool?
Are there other newcomers with whom I can share the cost of the car?
Can I afford car insurance, maintenance and service costs?
If the office is not at a distance, or if you can become a member of a car pool, do not buy a car. For long distance travel, take the train, though this is really done. I wonder why as travelling in US trains is economical and an experience in itself. You can also hire a car for the weekend. It’s dirt cheap and many rental companies provide special weekend discounts.
If you feel you cannot do without a car, leasing a car may make sense at times. A typical leasing option (under which you would have the option to buy at the end of the lease) for a new Honda civic would be $200-$250 a month for 13 or 24 or 36 months.
BUYING
A TELEVISION: A new 29 inch television will cost approximately $150. You can also opt for a second hand set. A serviceable set will be available at one-third the cost. To get a local cable connection, ring up your cable operator and sign for service. There are different kinds of services and packages. Basic service will cost around $25 a month. But if you opt for the pay channels you may have to pay between $ 50 -60
UTILITIES - ELECTRICITY, GAS AND WATER
Set aside $ 100–125 for electricity and gas. Water is generally included in the apartment rent. Quietly cough up the amount as there is no scope for cutting costs here.
TELEPHONE: Unlike India, you can chose your LSD line in the US. Most companies offer attractive packages so it pays to shop around for the best price. The basic rental will be around $35. But many techies run phone bills as high as $250 reporting every minor detail of their stay. So every time, you feel like telling amma and friends that you miss them and dil abhi hai hindustani, e-mail to them or write a letter. If you are careful, your phone bill will not be more than $100-150.
Long distance or international calls work out cheaper if you opt for phone cards. Usually, phone are priced low. The call card functions like a mobile phone service and you can make your call from a public booth or a friend’s place. So when you get to the US look around.
INTERNET: You will have to pay a nominal amount of approximately $20 for your Internet connection. Many companies provide a month of free service. It is better to subscribe for a year, and pay in advance as your Internet connection will cost you sixt per cent less. You do get back the money in case you decide to unsubscribe midway. If you are considering the ISDN connection, the charges are about $49 for unlimited access.
CREDIT CARD: Monthly credit card payments will be in the range of $30 and 60, depending on the kind of card you opt for.
GROCERIES: For heaven’s sake, however sinfully mouthwatering, don’t pack amma’s appams and garam masala to take to the US. These are easily available at Indian stores. Your monthly grocery bill will not exceed $150. But costs can be cut, not by starving and depriving yourself of the goodies you want to pick up, but by teaming with two or three people to buy groceries. In the US, the bigger, the pack you purchase, the lesser the cost. I also recommend shopping at warehouse stores. They are twenty per cent cheaper, but you need to buy in bulk. Warehouse stores may be located at some distance from your apartment, so factor transportation costs before you shop there. Shop for groceries on Tuesday, Wednesday and Thursday as you can avoid the weekend rush and queues.
You can also consider shopping online for groceries. Some sites which I visited are
whyrunout.com and homegrocer.com. But these will include delivery costs and will be 15 to 20 per cent more expensive. You will also have to pay an initial membership fee of $2 to 3. Therefore, avoid online shopping. Certain online stores like Webhouse club have introduced a novel way of shopping. Customers can name the price to which they want to pay for groceries and can pick them up at the local grocery store. Find out more details when you reach the US.
TRAVEL: I assume that if you have gone to the US, you would like to travel and visit Staes and cities other than the one you are based in. Travel is not very expensive, especially if you are travelling with friends Rental rates for an economy car is around $25- 30 per day, with insurance ranging from $10-$15 per day. Insurance covers you from having to pay for repairs in case there is any unfortunate accident. (Check up
www.nationalcar.com/ for rental car rates from National Car Rental). A 600 to 700 miles round trip, budget $ 800-1,000.
EATING OUT: There is a substantial cost differential between cooking at home and eating out. Cooking at home is four to five times cheaper. Considering the Indian palate the closest most Indians ever get to continental food is burger and pizza. A meal comprising Coke, chips and pizza will be between $6 and $8. Average Indian or Chinese or American buffet ranges from $5.95 on weekdays to $7.95 on weekends. The buffets are essentially "all you can eat" places with lots of different food choices. At specialty restaurants, the food is more expensive.
SHOPPING: If you are in the US for a six to twelve month period, wait for the Labour Day or the Christmas sale to shop for gifts. A gift on which you may expend $100 may cost around $ 40 during a sale. So don’t be in a hurry to buy gifts, the minute you like something. Bide your time. Remember in the US, branded products are sinfully expensive and avoidable buys for the money conscious.
THE FINAL WORD: After the initial investments on furnishing your house, your monthly expenditure including rent will be around $2,000 a month. Do not fret at the fact that you are spending around Rs 80,000 a month, the equivalent or a bit more than your salary in India. Remember you are also earning four times the amount.
Disclaimer: (All statistics provided in this article are approximate figure. The views expressed are those of the author and
AssureConsulting.com takes no responsibility for them.)
(Many of Assureconsulting.com's readers have taken time off their busy schedules to provide inputs to the writer for this article. The writer thanks readers, especially,
Manish Gopal who e-mailed valuable information from the US. There are others who have contributed equally but do not wish to be named.)
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