A friend of mine accepted a $180K offer in San Francisco last spring, then moved to Seattle eight months later for a $162K role. She says it was the best financial decision she’s made in years. The numbers bear her out, even though the headline salary went down.
The conversation around tech compensation is still weirdly fixated on base salary. Nobody talks enough about what you actually deposit. State income tax, city tax, rent, and payroll deductions carve out very different slices depending on where you work. Here’s a 2026 look at what the actual numbers show.
The Seattle vs. San Francisco math nobody puts in the offer letter
San Francisco and San Jose median software engineering salaries sit around $178K to $183K, depending on level and company. That sounds dominant. But California charges up to 13.3% in state income tax, and Bay Area rent for a one-bedroom runs $2,900 to $3,400 a month in most neighborhoods outside the Mission corridor.
Seattle’s median is roughly $162K to $168K in 2026. Washington state has no income tax. At all. Rent for a comparable place in Capitol Hill or First Hill is $1,850 to $2,200.
Run that through a rough take-home calculation and a Seattle L4 at $165K clears more spendable income per year than an SF counterpart at $182K. The gap isn’t huge, maybe $7K to $11K annually in Seattle’s favor, but it’s real and persistent. The Bureau of Labor Statistics Occupational Outlook Handbook shows software developer wages holding strong in both metros, but doesn’t do the after-tax math for you.
New York is its own category
New York City compensation for senior engineers ranges from $145K to $165K at finance-adjacent tech shops. The top-end fintech and trading firms pay considerably more, but those are outliers, not the median experience.
What makes NYC painful is the tax stack. You pay federal, up to 10.9% in New York state tax, and then the city adds another 3.88% on top. That’s a combined marginal rate that can hit 47% or higher at $150K. Manhattan rent for a one-bedroom? Call it $3,200 to $3,700 on the low end. Brooklyn is cheaper, but not as cheap as people assume anymore.
Engineers who stay in New York tend to do it for the career network and the finance-adjacent comp, not the take-home math. I think that’s a reasonable trade at certain career stages. Earlier than senior IC, probably not worth it purely on numbers.
Austin: the “same purchasing power for less stress” city
Austin tech salaries have settled into a real range now that the 2021-2022 hiring frenzy cooled off. Median software engineering comp in 2026 runs around $125K to $132K at established companies and $115K to $125K at the mid-size startups that relocated from the coasts.
Texas has no state income tax. Austin rent for a reasonable one-bedroom outside downtown is $1,450 to $1,750. The cost of living index sits around 118 to 123 relative to the national baseline.
An Austin engineer making $128K takes home a number that, after tax and housing, is surprisingly close to a San Francisco engineer at $175K. Not equal, but close enough that the difference doesn’t justify the Bay Area rent math for a lot of people who don’t need the specific career exposure SF offers.
The catch is that Austin salaries have not kept pace with the cost-of-living increases since 2020. Housing went up faster than wages there. The arbitrage is thinner than it was in 2022.
Denver is underrated in this conversation
Denver doesn’t come up as often as Austin or Seattle, and I think that’s partly because it doesn’t have the startup mythology or the FAANG presence. But the numbers are reasonable. Median software engineering salaries are around $122K to $130K. Colorado’s income tax is a flat 4.4%, which is much simpler and lower than California or New York. Rent for a one-bedroom in the Highlands or Capitol Hill neighborhoods runs $1,600 to $1,900.
The outdoor access and quality of life are genuinely good. I’d rank Denver ahead of Austin for pure livability if you care about that kind of thing. Quality of life doesn’t show up in the spreadsheet but it affects retention and mental health in ways that eventually affect career trajectory.
Remote work and location arbitrage in 2026
The 2024 Stack Overflow Developer Survey found that remote and hybrid engineers reported median salary around $141K globally for experienced developers, with significant variance by employer location even when the employee is fully remote. This matters because the location arbitrage play, working for a SF-headquartered company while living in Boise or Raleigh, has gotten more complicated.
A growing number of companies now geo-adjust remote salaries. Google, Meta, and others have been doing this for years. Stripe switched policies twice in three years. If your remote employer pays market-for-location, the arbitrage shrinks considerably. If they pay flat national rates, it’s still very real, $12K to $18K per year in reduced housing costs is not trivial.
I don’t have solid data on exactly what share of remote roles are now geo-adjusted vs. flat-national. My sense is it’s around half, but that’s an estimate I’d update if anyone has better numbers.
What this means if you’re weighing an offer
The relevant number is monthly disposable income, not base salary. A quick back-of-envelope: take your base, subtract estimated federal and state tax (there are decent calculators for this), subtract rent, subtract rough monthly costs. Compare that number across cities, not the headline offer.
Seattle and Austin tend to win this calculation for mid-level engineers. San Francisco wins it only if your comp includes meaningful RSU grants from a company with real upside, because that’s where the real use in SF salaries sits, not in the cash component.
If you’re in interview loops right now, Craqly can run you through negotiation and offer-comparison practice so you’re not making these calculations in a fog after getting a verbal offer on a Tuesday afternoon call.
One thing worth noting: the city you choose affects the salary you can negotiate in the future. SF and NYC build the network and the resume signal faster for most roles. Whether that’s worth the cost gap is something only you can answer.