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-   -   Moving from London to CH for less money? (https://www.englishforum.ch/housing-general/289436-moving-london-ch-less-money.html)

KubaUK 22.01.2019 11:48

Moving from London to CH for less money?
 
Hi everyone

We are looking to move to Switzerland (thinking Geneva or Zurich) from London. We have done a fair bit of research and one thing that I concluded is that the move from London to GVA/ZUR is different for everyone due to their individual situation… hence so many people are asking every time on this forum, in addition to using the ‘available resources’.

My main question/point -> we have (a little bit of) money, but we want to trade some of it for quality time. Do you feel that switching £200-240k in London make sense for £155-190k equivalent in Zurich/Geneva (CHF200-240k incl. bonus) with all of its associated costs?

- Will we compromise the financial flexibility too much for just an incremental gain in life quality?

I appreciate everyone has to make their own decision on this, but any perspectives from those who made the move would be appreciated.

--------------------------

Details for those who are interested…

I am not intending to boast/brag/do whatever about my situation. I just want to lay out some facts and understand how my life would potentially change in Zurich (what I would gain/give up). I would really appreciate factual answers.

Current situation:
- Couple in early thirties with a baby coming up very soon and hoping for one more; originally from Central/Eastern Europe; have a small dog
- I work in finance (salary £140k + ~£60-100k bonus), my wife doesn’t work (please assume for now she won’t work in CH)
- We have 2 rental flats in London (with mortgages) + own our current 2 bed flat in Islington/zone 1 (no mortgage) – lucky we got early on the magic ‘property ladder’ during the malaise in 2010
- We could sell our current flat we live in and move to a 150sqm house in Clapham, so that we can fall in one of the catchment areas and still have a reasonable commute to work (20 mins cycling for me) + manageable mortgage <£500k
- My workday is from 6:30am to 6:00pm (sometimes 5:30am), never work weekends, never late nights
- We have a car from an upper range, and we would like to have some car in Geneva/Zurich

Our lives sound ‘great’ (to some), so why change?
- Brexit situation is sickening and we are tired of the constant uncertainty, i.e. so what that we are making X amount of money/savings, in a situation when the value of these is highly uncertain 5 years from now?
- We are tired of constantly having to drive hours in traffic outside of London to just walk around in some green space (yes we know there are parks here, but how many times can you do the same route around Hampstead Heath over the weekend?)
- We go to theaters 1-2 times a year, eat out maybe once a month and generally do not make the most of what London has to offer
- We are not fully sold on the education system in the UK with the likely need to pay for private secondary schools (even if we fall in the catchment areas for the primary school)
- A job in Switzerland promises more flexibility in terms of hours and certainly no 6am starts
- We found ourselves travelling at least once a month to Chamonix before the pregnancy and we really enjoyed that calmness, nature, etc.

Main concern on the move -> the job in Zurich offers CHF100-120k base + 100% bonus (+/-20%) – and looking around this seems fairly attractive in finance over there (am I right?) – so contrary to the situation of some individuals on the forum, I would be swapping for a lower income (both in absolute terms, and especially after FX). Does this make sense or is the gap too big? Are we going to be 'killed' by the wealth tax on UK assets?
- Please keep in mind that, we want to… (i) live within 30 mins commute from the job, in a house with a garden, (ii) keep our car, (iii) be able to go on 1 summer holiday at least, and (iv) save “some” money

So, would you do the switch?

I appreciate the time of everyone who made it to the end.

RufusB 22.01.2019 12:00

Re: Moving from London to CH for less money?
 
Can't speak to the majority of this but you do seem to be assuming you'll get your 100% bonus. That's not guaranteed and therefore makes the gap in your projected salary far greater.

Congratulations on the imminent arrival. Free on the NHS. Not in CH. I assume your wife has a great support network here. That won't be the case to start with in CH. And trust me on this: as wonderful as a new baby is, it's also exhausting and quite isolating for the at-home carer.

Would I move given the situation you outline above? No. Better the devil you know, I reckon.
But that's me. London isn't my favourite place but there's certainly huge amounts to do.

You're quite a way away from needing to worry about secondary schools. Get yourself in a catchment with good/outstanding primaries and breathe.

Good luck.

KubaUK 22.01.2019 12:17

Re: Moving from London to CH for less money?
 
First of all - thank you for the quick response.

Quote:

Originally Posted by RufusB (Post 3032914)
Can't speak to the majority of this but you do seem to be assuming you'll get your 100% bonus. That's not guaranteed and therefore makes the gap in your projected salary far greater.

This is the indication I received from a person in the company who says that (oddly) there is amazing transparency of salaries there, so everybody knows what everyone else earns (...) And this has been a general trend for X years. But fair enough with your comment - every company has a rough patch and I can get disappointed with my budgeting (thanks for pointing this out).


Quote:

Originally Posted by RufusB (Post 3032914)
You're quite a way away from needing to worry about secondary schools. Get yourself in a catchment with good/outstanding primaries and breathe. Good luck.


haha, "breathe" is probably the right thing to do. I always think way ahead. But I do see other 40+ here and I am not keen on their lifestyle hence trying to anticipate that earlier and not waste my thirties on a rat race in the City.


Anyway, initially we were leaning strongly towards CH (as everyone says "salaries in CH are higher"), but after we did all pros/cons (and realised that in some cases they may not be higher), we seem to prefer staying put and see how things develop - I posted this to make sure I am not missing something very obvious.

Thank you very much again!

Silvestre 22.01.2019 12:26

Re: Moving from London to CH for less money?
 
I would second RufusB's post.

Perhaps others would disagree but, from a financial perspective, I would say that:
  1. CHF 100 - 120k is more comparable to £55 - 60k. Just to put it in perspective, whilst the bonus % is a lot higher, base of CHF 100 - 120k is a qualified accountant's base.
  2. Assuming 50% bonus payout, you are at CHF180k (c£135k). I, personally, would not be trading in a base of £140k in London let alone total package of £200 - 240k; and
  3. CHF is seriously overvalued (and conversely GBP undervalued) at this stage by 30 - 50%, thus at a more "normal" exchange rate that is £90k

KubaUK 22.01.2019 13:27

Re: Moving from London to CH for less money?
 
Quote:

Originally Posted by Silvestre (Post 3032923)
[*]CHF 100 - 120k is more comparable to £55 - 60k. Just to put it in perspective, whilst the bonus % is a lot higher, base of CHF 100 - 120k is a qualified accountant's base.[/LIST]

Thanks - that's really good relative perspective!

Quote:

Originally Posted by Silvestre (Post 3032923)
[*]CHF is seriously overvalued (and conversely GBP undervalued) at this stage by 30 - 50%, thus at a more "normal" exchange rate that is £90k[/LIST]

I suppose, it is a matter of judgment, but with Brexit uncertainty (£), debt level in the US ($), constant political mess in Europe/Italy (€) - plenty of wealthy people may prefer to just park money in CHF because they "know" they will take out the same amount in X years time (even if it earns nothing). Stability in the current world is pretty valuable and a lot of clouds of uncertainty have to get lifted for CHF to be out of favour (I think). But I am not a CCY "expert" - just a casual observer of the world :D

Brian1985 22.01.2019 13:40

Re: Moving from London to CH for less money?
 
Just my two cents. The financial services job market is really struggling here right now. Just look at UBS/CS/Baer and you get the picture.....endless cost cutting and increasing "juniorization" where experienced employees are pushed out and replaced by cheaper juniors. The buy-side is no different (look at GAM) with AUM moving into passive funds and fees under pressure....coupled with greedy owners/PMs who want to protect their margins by justifying any excuse to pay you a smaller bonus.

The issue this creates is that it becomes very hard to move or find a similar job if you don't like your employer or you get laid off. Let's say you're an equity analyst in London and you lose your job, well there are always a few openings in London and you eventually find something. Now, let's say you're an equity analyst in Zurich.....it might take you two years to find another job and you will have to compete with all the locals who have a much broader network.

The end result is you live in constant fear of losing the nice life you've built in Switzerland and having to move back to London/NYC if things don't work out. Also worth mentioning, the industry here is not really a meritocracy. The Swiss value loyalty and years of experience over ability. It's not like London where you can have a 30 year old MD and a 40 year old VP, generally the Swiss are suspicious of promoting people who haven't "done their time" so to speak. Just an FYI as it will vary from company to company and your fund/job may be different.

YuropFlyer 22.01.2019 13:50

Re: Moving from London to CH for less money?
 
Quote:

Originally Posted by Silvestre (Post 3032923)
[*]CHF is seriously overvalued (and conversely GBP undervalued) at this stage by 30 - 50%, thus at a more "normal" exchange rate that is £90k

Definitely NOT true regarding "overvalued CHF". At least not by anything like the numbers you're pulling.

https://www.cash.ch/news/top-news/ka...ntlich-1265448

The pound itself is weak, but again, not by 30-50%.

Since OP claims to work for a bank, I hope he knows that himself ;)

ankurm.2008 22.01.2019 14:17

Re: Moving from London to CH for less money?
 
Quote:

Originally Posted by KubaUK (Post 3032907)
Hi everyone

We are looking to move to Switzerland (thinking Geneva or Zurich) from London. We have done a fair bit of research and one thing that I concluded is that the move from London to GVA/ZUR is different for everyone due to their individual situation… hence so many people are asking every time on this forum, in addition to using the ‘available resources’.

My main question/point -> we have (a little bit of) money, but we want to trade some of it for quality time. Do you feel that switching £200-240k in London make sense for £155-190k equivalent in Zurich/Geneva (CHF200-240k incl. bonus) with all of its associated costs?

- Will we compromise the financial flexibility too much for just an incremental gain in life quality?

I appreciate everyone has to make their own decision on this, but any perspectives from those who made the move would be appreciated.

--------------------------

Details for those who are interested…

I am not intending to boast/brag/do whatever about my situation. I just want to lay out some facts and understand how my life would potentially change in Zurich (what I would gain/give up). I would really appreciate factual answers.

Current situation:
- Couple in early thirties with a baby coming up very soon and hoping for one more; originally from Central/Eastern Europe; have a small dog
- I work in finance (salary £140k + ~£60-100k bonus), my wife doesn’t work (please assume for now she won’t work in CH)
- We have 2 rental flats in London (with mortgages) + own our current 2 bed flat in Islington/zone 1 (no mortgage) – lucky we got early on the magic ‘property ladder’ during the malaise in 2010
- We could sell our current flat we live in and move to a 150sqm house in Clapham, so that we can fall in one of the catchment areas and still have a reasonable commute to work (20 mins cycling for me) + manageable mortgage <£500k
- My workday is from 6:30am to 6:00pm (sometimes 5:30am), never work weekends, never late nights
- We have a car from an upper range, and we would like to have some car in Geneva/Zurich

Our lives sound ‘great’ (to some), so why change?
- Brexit situation is sickening and we are tired of the constant uncertainty, i.e. so what that we are making X amount of money/savings, in a situation when the value of these is highly uncertain 5 years from now?
- We are tired of constantly having to drive hours in traffic outside of London to just walk around in some green space (yes we know there are parks here, but how many times can you do the same route around Hampstead Heath over the weekend?)
- We go to theaters 1-2 times a year, eat out maybe once a month and generally do not make the most of what London has to offer
- We are not fully sold on the education system in the UK with the likely need to pay for private secondary schools (even if we fall in the catchment areas for the primary school)
- A job in Switzerland promises more flexibility in terms of hours and certainly no 6am starts
- We found ourselves travelling at least once a month to Chamonix before the pregnancy and we really enjoyed that calmness, nature, etc.

Main concern on the move -> the job in Zurich offers CHF100-120k base + 100% bonus (+/-20%) – and looking around this seems fairly attractive in finance over there (am I right?) – so contrary to the situation of some individuals on the forum, I would be swapping for a lower income (both in absolute terms, and especially after FX). Does this make sense or is the gap too big? Are we going to be 'killed' by the wealth tax on UK assets?
- Please keep in mind that, we want to… (i) live within 30 mins commute from the job, in a house with a garden, (ii) keep our car, (iii) be able to go on 1 summer holiday at least, and (iv) save “some” money

So, would you do the switch?

I appreciate the time of everyone who made it to the end.

I personally wouldn't make this move if I were you.
Grass is greener on the other side...

KubaUK 22.01.2019 14:29

Re: Moving from London to CH for less money?
 
Quote:

Originally Posted by Brian1985 (Post 3032947)
Just my two cents. The financial services job market is really struggling here right now. Just look at UBS/CS/Baer and you get the picture.....endless cost cutting and increasing "juniorization" where experienced employees are pushed out and replaced by cheaper juniors. The buy-side is no different (look at GAM) with AUM moving into passive funds and fees under pressure....coupled with greedy owners/PMs who want to protect their margins by justifying any excuse to pay you a smaller bonus.

Same in London really - very recent profit warning/anticipated cost cuts at SocGen, lower bonuses at ING + BNP. Seems like a structural issue for the sector unfortunately.

Quote:

Originally Posted by Brian1985 (Post 3032947)
The issue this creates is that it becomes very hard to move or find a similar job if you don't like your employer or you get laid off. Let's say you're an equity analyst in London and you lose your job, well there are always a few openings in London and you eventually find something. Now, let's say you're an equity analyst in Zurich.....it might take you two years to find another job and you will have to compete with all the locals who have a much broader network.

Thanks - that's a good perspective on the competition with locals + good to see how juniorisation has disproportional impact on senior individuals in CH.


Quote:

Originally Posted by Brian1985 (Post 3032947)
The end result is you live in constant fear of losing the nice life you've built in Switzerland and having to move back to London/NYC if things don't work out. Also worth mentioning, the industry here is not really a meritocracy. The Swiss value loyalty and years of experience over ability. It's not like London where you can have a 30 year old MD and a 40 year old VP, generally the Swiss are suspicious of promoting people who haven't "done their time" so to speak. Just an FYI as it will vary from company to company and your fund/job may be different.

All good points. Seems like most of the continental Europe requires employees to serve their time... I am one of those who thinks they are more "able" and so I jump quickly at new opportunities, so not very used to serving my time...

The appeal for Zurich was the growing AM, with under 100 people at the moment, and having direct exposure to the founders/owners/managers. But this is betting on a constant promise of being noticed by them one day (which may not be too promising if CH people believe that "serving time" is important)...

Silvestre 22.01.2019 15:56

Re: Moving from London to CH for less money?
 
3 Attachment(s)
Quote:

Originally Posted by YuropFlyer (Post 3032951)
Definitely NOT true regarding "overvalued CHF". At least not by anything like the numbers you're pulling.

https://www.cash.ch/news/top-news/ka...ntlich-1265448

The pound itself is weak, but again, not by 30-50%.

Since OP claims to work for a bank, I hope he knows that himself ;)


some support for the claim. If you take the midpoint of the Economist you end up with 39%

KubaUK 22.01.2019 16:57

Re: Moving from London to CH for less money?
 
Thank you once again everybody! I am sure we will feel now a more at ease about the idea of swapping our flat in London for a house for the next few years!

Will be visiting CH instead for the weekends to do our hiking and skiing :)

eyebeebe 22.01.2019 20:36

Re: Moving from London to CH for less money?
 
Also worth considering this on a post tax basis.

According to my UK post-tax salary calc app GBP 200k gross = 111k net, excluding company/personal pension contributions.

Depending upon where you live in Switzerland the tax rate varies massively, but where I live, CHF 230k gross = c. CHF 160-170k net including a decent pension contribution and would be higher still for a married couple with a single earner and children. Note in Zurich canton this would be higher and Geneva higher again.

Our train station is 25 minutes from Zürich main station.

So potentially not a pay cut at all. There is plenty of info on this site about the general cost of living, so you can work out the cost side based on your lifestyle.

I would say though that the base pay change you are looking at certainly implies a reduction in seniority in a financial services role.

eairicbloodaxe 22.01.2019 21:07

Re: Moving from London to CH for less money?
 
Also worth considering this on a post tax basis.

According to my UK post-tax salary calc app GBP 200k gross = 111k net, excluding company/personal pension contributions.

Depending upon where you live in Switzerland the tax rate varies massively, but where I live, CHF 230k gross = c. CHF 160-170k net including a decent pension contribution and would be higher still for a married couple with a single earner and children. Note in Zurich canton this would be higher and Geneva higher again.

Our train station is 25 minutes from Zürich main station.

So potentially not a pay cut at all.



This unfortunately depends if you manage to successfully "leave" the UK. Which (If you keep your properties there) may not be so easy.


IF HMRC deem you tax resident in UK and so do the Swiss, you pay the combined highest rate of tax. Eg. If it's 40% in UK and 25% in CH, you pay 25% to CH and then 15% to UK.


It's worth it for me because I moved for more money, but could be a nasty sting in your situation.


Regards




Ian
https://www.englishforum.ch/images/buttons/edit.gif

KubaUK 22.01.2019 22:35

Re: Moving from London to CH for less money?
 
Quote:

Originally Posted by eairicbloodaxe (Post 3033151)
Also worth considering this on a post tax basis.

According to my UK post-tax salary calc app GBP 200k gross = 111k net, excluding company/personal pension contributions.

Depending upon where you live in Switzerland the tax rate varies massively, but where I live, CHF 230k gross = c. CHF 160-170k net including a decent pension contribution and would be higher still for a married couple with a single earner and children. Note in Zurich canton this would be higher and Geneva higher again.

Our train station is 25 minutes from Zürich main station.

So potentially not a pay cut at all.



This unfortunately depends if you manage to successfully "leave" the UK. Which (If you keep your properties there) may not be so easy.


IF HMRC deem you tax resident in UK and so do the Swiss, you pay the combined highest rate of tax. Eg. If it's 40% in UK and 25% in CH, you pay 25% to CH and then 15% to UK.


It's worth it for me because I moved for more money, but could be a nasty sting in your situation.


Regards




Ian
https://www.englishforum.ch/images/buttons/edit.gif

We definitely want to keep the properties (especially if we are not buying in CH - and thus far I have not seen a single post online supporting house purchase over there). As a result we were concerned with the wealth tax. My (rudimentary) understanding is that for UK taxes we need to be a resident in the UK for over 183 days and otherwise there is no personal tax liability (there is also no personal allowance I believe and we would pay flat 20% rate on the rental income we make).

Re lower tax rate - I have been reading about that. However, a local person from Zurich advised me to take ~40% from my gross salary for all deductions (incl. health insurance + pensions + federal taxes + kanton taxes). So I erred on a side of caution and assumed 40%.

Also, I can run a theoretical spreadsheet, but only a person that has been to both places and lived there, would realistically know how they feel in each respective location with a given income. And thus far it seems that overwhelming majority would feel better in London.

Odile 22.01.2019 22:45

Re: Moving from London to CH for less money?
 
We are all different- and there are 1000s of different factors apart from salary and taxes- for sure. Quality of life is very much in the eyes of the beholder.

miniMia 22.01.2019 23:15

Re: Moving from London to CH for less money?
 
I agree with those who would not move for that kind of pay cut. As was said the Financial sector is in a mess with Job cuts, uncertainty, and lower level lower paid positions, as you very well see by the quality of this offer.

I think you are also fooling yourself to think that people in the financial sector are not working 23 hr days with zero commute time. (Commenting is particularly bad in Geneva). The competition for the jobs that are left, understaffing, leaves people working really long hours.

I'm confused why you would think this is a good offer in Switzerland. I'm 100% certain if you were offered this is London you'd run.

KubaUK 22.01.2019 23:48

Re: Moving from London to CH for less money?
 
Quote:

Originally Posted by miniMia (Post 3033181)
I agree with those who would not move for that kind of pay cut. As was said the Financial sector is in a mess with Job cuts, uncertainty, and lower level lower paid positions, as you very well see by the quality of this offer.

I think you are also fooling yourself to think that people in the financial sector are not working 23 hr days with zero commute time. (Commenting is particularly bad in Geneva). The competition for the jobs that are left, understaffing, leaves people working really long hours.

I'm confused why you would think this is a good offer in Switzerland. I'm 100% certain if you were offered this is London you'd run.


Thanks. I have not started this post with the premise that this comp is ‘better’ than in London. I am aware it is not. I would not be switching to focus on my career, but to start at 8-9am, finish by 5pm, work sometimes from home - all these things have value.

But, realistically speaking I was not aware how much worse the salary comparison is. Someone mentioned above, that CHF100-120k ‘feels’ like £55-60k in London. To me that says it all -> we are not willing to make that compromise for a promise of POTENTIALLY fewer hours in the morning and some days of working from home.

This post has been nevertheless a very helpful source of info for us in reaching this conclusion (as we are deciding now where to move to a bigger house) so once again - thank you everyone for your help!

Jim2007 23.01.2019 03:11

Re: Moving from London to CH for less money?
 
Quote:

Originally Posted by KubaUK (Post 3032970)
The appeal for Zurich was the growing AM, with under 100 people at the moment, and having direct exposure to the founders/owners/managers. But this is betting on a constant promise of being noticed by them one day (which may not be too promising if CH people believe that "serving time" is important)...

Have you any experience of trying to land an AM job in Zurich? I can tell you that right now it’s a race to the bottom and the main cost cutting is salaries and bonus. To get the kind of financial rewards you are expecting you’d need to bring something especially to the table, like a client block (yes, I know we’re not supposed to do that, but that is reality). You want the big bucks you need to be bringing in the big fees.

Urs Max 23.01.2019 08:44

Re: Moving from London to CH for less money?
 
Quote:

Originally Posted by KubaUK"
As a result we were concerned with te wealth tax.

This varies wildly. A married couple with 1mln net wealth pays 0.6% at most (0.2% in Zürich). But the percentage increases with the net wealth, taxation for 25mln net weatlh is the highest in Geneva with about 2.5%.

See this table with amounts and tax by Canton, notice the link "Einkommenssteuern für Verheiratete" in the section labeled "Was Sie sonst noch interessieren könnte" (notice the arrows on the rigth to navigate).

Alternatively play a bit with the official tax calculators für Zürich, you're interested Staats- und Gemeindesteuern (local and Cantonal tax, income and wealth are taxed) and Bundessteuer (federal income tax, no wealth tax on the federal level), together the two form for your total tax burden.

Rental income gained in the UK will be added to your income from the job, assuming it hasn't been taxed in the UK already.

KubaUK 23.01.2019 09:27

Re: Moving from London to CH for less money?
 
Quote:

Originally Posted by Jim2007 (Post 3033200)
Have you any experience of trying to land an AM job in Zurich? I can tell you that right now it’s a race to the bottom and the main cost cutting is salaries and bonus. To get the kind of financial rewards you are expecting you’d need to bring something especially to the table, like a client block (yes, I know we’re not supposed to do that, but that is reality). You want the big bucks you need to be bringing in the big fees.

That's really good info re the environment.

I have a fairly good visibility among clients across Europe/US in what I do (within capital markets), and indeed already some 'network' in GVA and ZUR. I threw the idea of moving there to just 2 of my clients there in December and that's how they both started interviewing me, without any job adverts out there, etc.

At the same time it is good that you say this package they are talking about is "big bucks". If this is the top end, then at least I understand there is not much upside from there (obv I appreciate more senior people will earn more etc, but at VP this is good if you can get it I suppose).


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