# Comparable salary in a different city calculations

I am doing a salary comparison depending on 2 cities. Very similar to this website

So you select a source city, then a destination city, your current salary in the source city and it will output the "comparable" salary in the destination city. I want to confirm that what I am doing is correct, just bare with me for a minute. I will give you an example. All the data is fictional.

Source city: Cleveland, OH
Destination city: Seattle, WA
Cleveland Salary: $120,000  The way I compare is I take the housing prices, transportation prices and see where it's higher/lower. So, let's assume I will take into consideration only these two pieces of spending: housing and transportation. On average housing represents 30% of spending, while transportation is 20%. Let's assume that housing is 10% more expensive in Seattle, while transportation is 5% cheaper. Now, here is where I want your help. Am I doing this right? 1. 30% + 20% = 50% in salary will fluctuate (since I take into consideration only these two spendures) 2. Total amount that will fluctuate from source salary is:$120,000 - 50% = 60K
3. Housing is 30% (=$36,000) from 60K 4. Transportation is 20% (=$24,000) from 60K
5. Housing is 10% higher, so 36K + 10% (3,6K) = $39,600 6. Transportation is 5% lower, so 24K - 5% (1,2K) =$22,800
7. Comparable Salary in Seattle would be (the untouched) 60K + 39,600 + 22,800 = \$122,400

Do these calculations seem right to you?

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 Seems fine to me. – varty Nov 18 '11 at 17:00 Looks fine, you should probably add in food and any state-based tax rate differentials as well. – Michelle Feb 17 '12 at 20:30 It looks good for a quick-and-dirty calculation, but another way to think about it is calculating discretionary take-home pay. Take the salary and subtract the appropriate COL for the first location, and then add back the COL for the second location to get the equivalent salary. I'm sure others have done a lot of prior work mapping out COL based on more factors, which could be more robust than just looking at housing and transportation. For selecting COL, you could use just the average/median, or potentially something fancier like taking their current percentile as a lifestyle indicator. – Jonathan Jul 17 '12 at 1:07 @Alexandru, We are happy to bear with you -- that's what the site is for -- but out of modesty we may choose not to bare with you. (For that, the internet offers, I believe, alternative venues.) – Arthur Small Dec 14 '12 at 14:56

Works out nicely. A somewhat more condensed version of the calculation is

Predicted Seattle Salary = 120000*(1-.3-.2)+120000*(1.1*.3)+120000*(.95*.2) = 122400


Using this in XL might speed up your work.

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Or an even more condensed version, which helps really break it down into how the different elements contribute to the result:

120000 * (0.3*1.1 + 0.2* 0.95 + 0.5*1)

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