Early FI – How to “Survive” in the Bay Area… Temporarily

by FI Fighter on March 31, 2017

in Bay Area, Travel Updates

As readers know, I’m back in the Bay Area now… and having one hell of a time trying to make ends meet here! When I checked out of the game for good last year, at the age of 31, I had a pretty good inkling that it would be really tough for me to survive out in the Land of High Tech (let alone thrive), so within a matter of a few months, I had booked my ticket out to Hong Kong and said “peace out” to Silicon Valley…

No, I’m not trying to be all doom and gloom… Certainly, it’s a viable option for one to hunker down and embrace a Life of Minimalism (to conserve on cash and really make sure their dollar stretches a long, long ways)… By doing that, I’m sure it’s possible that all the “pain and sacrifice” involved could be worthwhile in letting a person continue living in the Bay Area on a most frugal budget.

But you know what?

After experiencing a wonderful few months in Asia, I just don’t want to live “bare bones” like that…

I mean, why do so when I don’t have to?

So, yes, I have every intention of returning overseas back to SE Asia for some more sun, fun, and CHEAP living!

However, as I mentioned in the last post, I have some business that I need to take care of in the Bay Area, so for the immediate future, I will be residing here, in the Land of Super Expensive.

It is what it is, so I’m just gonna try and do my best to maximize my time here.

For starters, let’s see how we can save some serious $$$!


The biggest ticket item out in the Bay Area is no question housing! How do I know? Well for starters, Rental Property SH #3 recently went vacant and I had the task of trying to fill the unit before April 01 to avoid a vacancy…

I handed off the keys to the new tenants today, so luckily I can now cross this important item off the list (made it just on time)!

Monthly rental income?



Hey, just because I own rental properties out here doesn’t mean I have to sip on all the Kool Aid that’s being served out! Yes, I ABSOLUTELY agree that the rental rates are absurd! I mean I, myself, could NEVER hack early FI if I was forking over that type of dough each and every month…


Just keeping it real here.

No, instead, I’m doing what I do best — House Hacking.

I implemented House Hacking successfully in my 20s and I’m attempting to do it again my 30s… This time around, instead of living with family, I’m relying on the kindness of my good buddies (shout out to my AWESOME landlord if he’s reading this!).

Right now, I’m renting out a single room for ~$575/month… Call it the “homie discount”…

$575/month in the Bay Area?!?

Yes, my homie is definitely hooking me up here, and I of course really appreciate it! In turn, I’m going to do my best to stay out of his hair…

This means:

  • I’m hardly there.
  • I’m really only there to sleep at night.
  • Minimize usage throughout the house, especially the kitchen.
  • Minimize usage of water, in particular.
  • Don’t mess with no heaters, and other gadgets that drain gas/electric.
  • Etc.

It’s a give and take kinda agreement… A mutually beneficial business transaction, if you will — I get a nice place to stay at a discount and I’m helping him pay down his mortgage at minimal inconvenience to him.

In any case, yes, $575/month in rent is a pretty sweet deal out here in the Bay Area!

But if that’s not possible for you, I strongly believe that ~$700-800/month should be doable (my multiple datapoints definitely suggest so)… There are tons of homeowners out here who desperately wanna get to early FI too, so they should be more than willing to help someone out who is able/willing to negotiate a similar type of mutually beneficial “partnership” as the one I entered into!

Anyway, $575/month (with utilities and wi-fi included) sure beats $2,895/month (with NOTHING included), no questions asked!


Food ain’t cheap in the Bay Area either, especially restaurants. I’ve been routinely spending $5/coffee and $12/meal (before tax and tip).

I stopped by Specialty’s (a coffee shop) today in Santa Clara. Over $8 for a small salad… We’re talking north of $10 for a large salad!

Shit, dem inflated prices get old fast, no joke…

How can I save on food?

Well, since I’m trying to minimize kitchen usage, lately I’ve been relying on an old friend a lot — Costco.

Yup, good ol’ Costco.

You can buy in bulk and their food court ain’t half bad either… Obviously, this isn’t an ideal long-term solution, but the whole point of this post is to address a short-term “survival” plan.

Costco salads are only $3.99/bowl

They are pretty filling and large too! Processed chicken ain’t the best stuff, but there’s a lot of greens and tomatoes… I dunno, I could do far worse, I guess.

This is an interesting challenge that I’m facing here… For the most part, I try and stick to eating on the greener side of things, for health reasons…

Still, the Bay Area ain’t cheap so I ain’t indulging in my pleasure traps quite the way I was when I was in Asia…

Cell Phone

I’m making use of Ting right now, so utilizing a “pay as you go” plan… The intent here is to try and use free wi-fi as much as possible (say 90% of the time), only tapping into the dataplan on the rare occasions when I don’t have wi-fi available…

Yes, I even rely on Google Hangouts to make free wi-fi phone calls…

Yes, I’m a cheap guy… or at least I try and save $$$ whenever/however I can.


This one kinda sucks… Registration, insurance, gas, geez, I really miss my Hong Kong BMW (Bus, Metro, Walking)!

Not sure how I can save much more on this item, except… don’t drive too far and too often.

Right now, I wish I had an electric vehicle, but I’m stuck with a hybrid…

So, again, I guess things could be worse, but transportation costs in the states really is a HUGE expense I much prefer to do without!

Early FI Thoughts

You might be wondering/thinking:

“Gee, FI Fighter, you really sound like you planned this whole early FI thing pretty badly… In fact, I don’t think you’re even in early FI at all you phony! If you can’t make it in the Bay Area, why don’t you get off your bum ass and get back to work already?!”

Fair enough…

Well, it’s true that my cash flow isn’t “spectacular”, and ~$3,000/month doesn’t go very far at all out in expensive Cost of Living (COL) regions like the Bay Area…

But, dude, you only need like $1,500/month (housing included) to live like a champ out in SE Asia!

So, I ain’t fronting, that’s exactly what I’m all about right now!

To really hack it out here in the Bay Area, I’d say you probably need something on the order of $6,000-8,000/month to just survive if you’re going to buy a house (in a good neighborhood) and take on the responsibility of paying down a conventional 30 year fixed-rate mortgage (Principal, Interest, Taxes, Insurance, etc.) each and every month. Bump it up to say $10,000-15,000/month if you want to really live large and most comfortably.


Yeah, I’m not quite on that level yet… so that’s a no go proposition.


House Hacking…


Point blank — You gotta do it if you want to “survive” in the Bay Area.


Anyway, if I really, really, really wanted to make it work out in the Land of Absurd Housing Prices, I probably could… I mean, here’s my current mining portfolio.

Current as of March 31, 2017.

Let’s just use basic math here and say I could earn 3% yield on the current principal of $825,000.

That would be an additional $24,750/year, or $2,062.50/month.

In my situation, this would give me a bump up to over $5,000/month in cash flow…

Would that fly in the Bay Area?

Maybe, maybe not…

Obviously, I’m not enamored enough with the Bay Area to attempt such a crazy idea, or I would have done it by now…

Thanks, but no thanks…

I much prefer my mining stocks at this point in time, as I strongly feel that the upside potential is still immense… And down the line, yes, I’m going to attempt to “time the market”, and try and see if I can earn greater than 3% yield, and much more than $24,750/year, or $2,062.50/month in additional cash flow.

If I wanted a lot more than 3% yield, I know that I can also easily find that in the Midwest, today, focusing on cash flow properties… 8% yield (or even greater) should be realistic to obtain, since that’s about what my Indianapolis property is getting me now…


Anyway, that’s a story for another day…


I’m still quite bullish on commodities and mining stocks…


So, we’ll see where things go from here.


But yeah, the Bay Area is one tough cookie…

At Specialty’s, it’s $2.70/cookie (snickerdoodle), to be exact…


Yup, I’m starting to really miss SE Asia right about now!


Fight On!

{ 19 comments… read them below or add one }

1 ChillywitNo Gravatar March 31, 2017 at 9:21 pm

Jay, this is a great post. I can related to everything you said, and admire how you’re navigating the Silicon Valley housing stress. I lived in Palo Alto when I worked on my post-doc and was fortunate to have had a cheap living situation. I stayed there 10 years before I bailed with cash in hand (microphone drop) to live the lifestyle I wanted in a place that was more reality-based with respect to cost of living and had a good quality of life. That’s not to say that I don’t miss the Valley. I really do miss it at times but it’s with some mixed feelings. The cost of living is there is high, but the rewards can be too if you set up things right, have a side gig, and benefit from some luck.


2 FI FighterNo Gravatar April 1, 2017 at 11:18 am


Thanks for stopping by and the support! Yeah, Silicon Valley housing is pretty crazy, and it does take a bit of house hacking to to help us get ahead here.

Haha, that’s so awesome that you got what you wanted out of the Bay Area and decided to go elsewhere to a much more affordable COL environment! That’s how you really shortcut the way to early FI!

I will always be fond of the Bay Area as well, and who knows, maybe down the line I will elect to settle down here. For now, I think I can maximize my ROI elsewhere.



3 WheatNo Gravatar March 31, 2017 at 11:40 pm

Great post and reminded me of the days when I rented a single room for $500/month down in SJ. I guess the single room rent hasn’t increased that much all these years. This method of house hacking is much more doable when one is single and doesn’t have a lot of worldly possessions, but definitely saved me quite a bit of dough. Just curious, how do you handle the maintenance of your rental properties while you are oversea? Property managers or have your tenants send you the receipts?

Btw, congrats on getting a tenant so quickly. While still sky high, bay area rents, along with starting salaries for engineers, has softened a little over the past 12 months or so. It is still pretty ridiculous that a studio in East Palo Alto now runs for ~$1800/month though.


4 FI FighterNo Gravatar April 1, 2017 at 11:25 am


Wow, $500/month, that’s an incredible rate, even back in the day! That’ll help you get ahead in life and early FI.

Very true, housing hacking and what I’m doing is much easier and more applicable when you’re someone who doesn’t have family/kids to worry about. Still possible to do with a family, but for sure it’s easier without one.

In terms of property management, I self manage my Bay Area rentals myself, even from overseas. The tenants here are typically excellent and very low maintenance… For the most part, I can get everything I need accomplished from anywhere as long as I have access to wi-fi.

Wow, East Palo Alto has sure climbed up in the last few years. It was definitely a sleeper, under the radar location a few years back… The geography is too good to ignore, so it’s not surprisingly that the housing market there is HOT and catching up to the rest of the Bay Area and its much more expensive neighbors.

All the best!


5 Midwestern LandlordNo Gravatar April 1, 2017 at 1:57 pm

I get your point on living frugally and watching long term cost. But I think you are selling yourself a bit short if you think you couldn’t live in the Bay Area for quite a long stretch when you take into consideration your portfolio, savings, real estate, etc. Yes, maybe it will chip into principal, but you have a long ways to go before it will turn negative. Plus theoretically you have cash flowed it just fine with the extreme returns you have been getting in the stock market. Not to say that you can rely on that long term but the bottom line is lately your returns have been substantially higher that what financial planners talk about (4% withdrawal rate). Ultimately it just sounds like you want to travel to other places (and the fact that they are cheaper places to live is a bonus).

But I believe you could afford a lot of expensive meals and high rent for quite a long term at this point of the game and not really change much.


6 FI FighterNo Gravatar April 1, 2017 at 2:10 pm

Midwestern Landlord,

You’re probably right there and I’m definitely dramatizing things a bit (I tend to do that). Though it does help to get the overall message across loud and clear — The Bay Area is a very expensive place to live.

In my own situation, definitely I have the desire to travel and explore the world some more, and it really is a huge bonus that the areas that I want to visit currently feature a much more affordable cost of living environment.

In reality, even if the Bay Area was affordable and a lot cheaper than overseas, I would still be tempted to leave since I’ve been here practically my entire life… So, it’s all working out and pointing in the same general direction, and that’s for me to continue living overseas.

When it comes to margin of safety, yup, more is always better, and I’m really just dealing with a “first world problem” here… If I was desperate for cash, I could easily switch over my mining portfolio and savings into more cash flow… and like you said, even selling out of some principal to fund living expenses would still last me a very, very, very long time… perhaps even indefinitely…

So, I think I’m good to go with early FI, and just nitpicking things now.

But someday, I would like to turbocharge the cash flow some more and ensure I can make it anywhere in the world, that would be the ultimate dream.



7 Financial SamuraiNo Gravatar April 1, 2017 at 3:36 pm

Got a question! With a $825,000 portfolio, does your homie really feel bad charging you below market rate? Does he actually have a lot more money than you, which is is why he’s giving you a break? I would think that most people who have your type of portfolio wouldn’t be considered struggling.

And on the flip side, do you really need to live on under $3,000 a month in the Bay Area with a $825,000 portfolio? I think it’d be nice to live a little more comfortably and independently at 32 no? Not judging, just wondering because after I turned 26 I decided never to have roommates again. Maybe it was my quarter-life crisis.

I agree with you on the $10,000/month after tax budget if you want to own a decent home and live comfortably.

What are your income plans for the future?



8 alNo Gravatar April 4, 2017 at 4:49 am

You nailed it all….


9 FI FighterNo Gravatar April 10, 2017 at 5:05 pm


We are good friends and have a deal in place that benefits both parties. I don’t think he’s overanalyzing things too much and neither am I.

I’m very comfortable with my current living arrangement… I don’t need more and this is just temporarily anyway, as I have plans to return to Asia and travel some more in the near future.

In terms of income, we’ll see what investment opportunities open up in the future. I’m all ears.



10 PonNo Gravatar April 1, 2017 at 10:41 pm

That cookie didn’t taste good did it? My chocolate brownie was disgusting.


11 PonNo Gravatar April 1, 2017 at 10:42 pm

The chocolate fudge brownie I got was gross. Hope you liked your snickerdoodle 😉


12 PonNo Gravatar April 1, 2017 at 10:42 pm

ignore this comment, thought the spam bot took control again


13 FI FighterNo Gravatar April 10, 2017 at 5:06 pm


LOL! The snickerdoodle was pretty good! 🙂

Take care!


14 Micro DividendsNo Gravatar April 4, 2017 at 10:29 am

San Francisco resident here. This article really hits home. Although, SF is expensive, you’re really paying premium for the weather, cultural diversity, intellectual density/diversity, food! etc.

I’ve done a lot of traveling in my days, and lived in many places, but SF is probably my favorite city, within CONUS (Continental United States)

Would I want to live long term, probably not. But it does provide ample opportunities for higher earnings potential and increase in savings/investing, so long as I keep my expenses low.


15 FI FighterNo Gravatar April 10, 2017 at 5:07 pm

Micro Dividends,

Yup, SF is a wonderful city for weather, culture, food, etc, most definitely! It’s a favorite city of many residents and tourists…

I’ve lived in the Bay Area my whole life though, so I’m kind of itching to venture out and explore other regions more… Still, long term, I could see myself coming back here.

All the best!


16 MaxNo Gravatar April 8, 2017 at 1:01 am

Welcome back to the Bay.

Yeah, iUnno I don’t think you need to be making that much to live comfortably and I wonder if it’s really worth the cheap rent to not be able to use the kitchen.

I admire the frugality but personally don’t think I’d be very happy without the ability to cook regularly. Maybe get a mini-fridge, hot plate, and some basic stuff to at least make a meal once in a while or make an agreement to be able to use some sort of communal kitchen.

Also by your own accounts you should have around $5k/month between portfolio + rents, I’m all for frugal living but why are you not allowing yourself some more comforts?

You don’t need to go out and spend it all either, but you can live fairly well on like $1-2k/month if you can find cheaper housing with roommates and access to a kitchen. Just some food for thought.

How long you planning on staying around here?


17 FI FighterNo Gravatar April 10, 2017 at 5:08 pm


I have access to the kitchen, I’m just on the road a lot, so I tend to do very little cooking these days. Definitely, my friend/landlord isn’t depriving me, or trying to in any way.

Yeah, in terms of more comfort, I can easily obtain/access all that by going back to Asia, where I was living very comfortably for very cheap.

I’m in a good situation now… I plan on staying in the Bay Area probably 4-5 months, but we’ll see… Playing it by ear mostly.

Best wishes!


18 Dividend DiplomatsNo Gravatar April 8, 2017 at 3:07 pm

Damn it is expensive in the Bay Area. Makes me appreciate my low midwest cost of living here. Nice of your homie to rent you a room that cheaply. Love Costco, and that is a great deal for someone who is trying to get as much value for your money without leaving the meal unsatisfied. Best of luck and I think the numbers you cited at the end will be doable!



19 FI FighterNo Gravatar April 10, 2017 at 5:10 pm


Definitely, the Bay Area is expensive and the Midwest makes for some very economical living, a wonderful environment that really can support the early FI lifestyle! Housing, especially, can really help someone fast track their progress and you get a lot of bang for your buck out in the Midwest!

All the best!


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