That's true, and you make good points. I guess another factor is raise percentage, in this industry, I've never heard of a 2% raise unless they're thinking of letting you go... (or you've got 15 yrs under you belt, by which point lets hope you're making enough already) But I bet that's different the farther out you go from cities.... I wonder if there is a correlation with getting crummier raises in the lower cost of living areas as well?
The 2% was made up for demonstration purposes, I'm not really sure how it plays out in the real world. It is a good question. Though consider this:
$70K + 5% [1]
$50K living + 3%
-----------
$2.5M saved after 30 years [2]
$70K for life
$20K living + 3%
-----------
$2.7M saved after 30 years
Even a decent rate may not be all it is cracked up to be.
[1] For the first 15 years, whereafter you suggest it could plateau (at around $140K, in this case, which doesn't seem unreasonable given the current market and historic income increases)
[2] Assumes all non-living expense allocated income is invested at 5%.
> * I guess another factor is raise percentage, in this industry, I've never heard of a 2% raise unless they're thinking of letting you go...*
Sounds like you have never worked for a large defense contractor. The "standard" raise given to ~70% of the engineers last year (my last review cycle working for that company) was 2.1%.
So I work in the same industry, and I'd suggest shopping around some companies if possible, or explore the "consulting" side of things (which can still be very technical), but much more lucrative... I'm sure you can get a good pay bump just from a company switch too.
