What is a Good Salary to Live On? You May Be Shocked!

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If you’re just starting out or even if you’ve been working for a while, you might be wondering what is a good salary to live on. Honestly, the answer will depend on several factors. Read on to find out how much you need to make, to live comfortably.

What is a Good Salary to Live On

First off, when tackling this question, you have to think about whether or not you are single without children, single with children, or have a partner.

Your current living situation, and how many dependents you have, will change the answer to this question.

The truth of the matter is, if you only have to worry about yourself, then you can live on a lot less than if you have children or an adult family member that counts on your support.

So, let’s dive in and find out what a good salary is.

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1. Where You Live

Your location will play a major factor in what is and is not a good salary for you.

For example, according to GoBankingRates, the average living wage across the entire United States is $67,690 but in New York state it is $95,724 dollars.

But, let’s define the living wage…

How the term living wage is used here is being able to live comfortably, pay for housing, other monthly expenses, savings, and having some money for fun.

Keep in mind that currently, the median household income for an individual in the United States is $78,500 dollars a year, and the average salary is $36,000 dollars.

That means half of the adults in the United States make less than $36,000 and a half make over that amount.

So, if you take the numbers from GoBankingRates to heart, the average person in the states would not be able to live comfortably anywhere.

(You can find the living wage for each state here.)

I don’t really believe that is true.

While it might be true if you live in NYC or San Francisco, if you live in a smaller town where housing costs and the cost of living is lower, then you can live on a lot less than they are suggesting.

Keep that in mind when you decide where you want to live and how you want to live.

You can buy a million-dollar home in California and get a tiny 600 square foot place, or you can spend $150,000 dollars in a small town and get a 2,000 square foot, or larger home with an actual yard.

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Location will determine how well you live on whatever salary you have.

That means, if you are making $30,000 or $40,000 dollars and you want to live comfortably, you need to live in the middle of the county in a smaller community.

You don’t have to live in the middle of a cornfield as I do, but a smaller town will allow you to live well on an average salary.

If, however, you are bound and determined to live on one of the coasts, you will need to make a lot more money and have a salary that is well above the average income to enjoy your life.

If you are a single person living in Boston, New York, or Los Angeles, you’ll need roommates to be able to cover your housing costs and have the money to pay for basic necessities. 

Before you decide on where you want to live, spend some time researching the costs associated with living there compared to the salary you can expect to make.

In some American cities, your salary will be higher due to the fact that your living expenses are higher, but that salary won’t actually provide you with more money in your pocket each month.

This is true in some expensive cities such as San Diego.

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2. Your Lifestyle

Do you like to sit at home and read a good book on Friday night?

Or do you like to go out to some new club with friends and party all night?

Your lifestyle will have an impact on what is a good salary to live on and what isn’t.

Do you like to buy a new car every two years or have you been driving the same old beater since high school?

What about travel? 

Give your lifestyle or the lifestyle you’d like some thought.

If you like to be on the go all the time, then you will need to make more money than if you are more of a homebody.

Take some time and add up the average cost of the activities you enjoy. 

Add that to the housing costs you expect to pay and the cost of living in the city you live in.

This will give you a good idea of what you need to make each year salary-wise.

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3. Your Future Goals

Do you want to buy a house, save for retirement, and put your kids through college?

If so, then you will need a larger salary and have a lot of income for discretionary spending and saving.

You’ll need to save a higher percentage of your salary each month to reach those goals.

Instead of the 20 percent experts talk about, you might need to save 30 or 35 percent.

A minimum salary won’t get you to where you want to be.

After you have decided where you want to live and your cost of living, add on an additional 30 or 40 percent to determine a good salary for you.

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4. Your Debt

Do you have student loans to pay off or a lot of credit card debt?

If so, you will need to make more money than the average person.

A comfortable salary for you will be higher than for someone without debt.

Add up your monthly payment for all your debts. 

You’ll need to add this to your average cost of living and housing costs.

The point is, the less debt you have the less amount of income you need to be comfortable. 

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To Sum it All Up:

You’ll need to take your location and the standard of living you would like to achieve to determine what will be a comfortable life for you and what salary you will need to obtain it. A homebody living in a small town in North Carolina can live quite well on $30,000 or $40,000 dollars a year. Someone that loves the nightlife and lives in Southern California will need $100,000 dollars a year or more to live their dream life.

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