Why two big salaries are not the same salary
When people weigh a move between cities, they usually fixate on the headline number, and that number lies in two directions at once. The first distortion is currency: a salary quoted in dollars, pounds, or euros sounds different purely because of the exchange rate, with no change in what it buys. The second distortion is price level: rent, groceries, transport, and services cost wildly different amounts in San Francisco, Berlin, and Bangalore. A salary is only meaningful relative to what it has to cover, so the only fair way to compare two cities is to strip out both distortions and ask a single question: how much money do I need in city B to live the way I live in city A.
That is exactly what the adjuster computes. It first converts at the mid-market rate, the true rate before any bank margin, then multiplies by the ratio of the two cities' cost-of-living indices. The result is the equivalent local salary. Seeing the raw conversion and the adjusted figure side by side is often a small revelation: a London offer that looks like a pay cut against a San Francisco salary in dollar terms can be roughly level once London's lower cost of living is folded in, and a move to a cheaper city can leave you materially better off on a smaller nominal number.
What the cost-of-living index does and does not capture
The index is a blended average across the main categories of household spending, weighted roughly the way a typical resident spends. It is excellent for a first-pass comparison and poor at modelling anyone unusual. If you spend far more or far less than average on housing, the single biggest line item, your personal adjustment will diverge from the index. Someone who is happy in a small flat in an expensive city, or who insists on a house with a garden in a cheap one, will not match the average basket. Use the adjusted figure as the centre of a range, not a precise target, and sanity-check it against actual local rents for the kind of home you want.
The index also says nothing about tax, which is a separate and often larger swing between countries. A city can be cheap to live in but sit in a high-tax country, eroding the gross advantage before you ever spend it. That is why the most reliable cross-border comparison runs salaries through both this adjuster and the take-home calculator: one handles prices, the other handles tax, and only together do they tell you whether a move actually leaves you ahead.