We all want to live a life where we can cover our basic needs and live comfortably. However, not all of us know what that entails or how to do it.
While in high school, each student is asked what they want to do as a career? But no one tells us what careers to look for according to annual salaries.
As we venture out into the real world and start applying for jobs, we might wonder if that job offering an annual salary of $60,000 is going to be enough.
Below we will talk about what a $60,000 yearly salary looks like, how it compares to the US average, and what sort of lifestyle you can expect from it.
What does a $60,000 yearly salary look like?
A yearly salary of $60,000 sounds like a lot of money, but what does that look like broken down, and how much of that will you get to take home?
Let’s take a $60,000 yearly salary and break it down using a 40hr work week, factoring in 52 weeks a year.
Gross Income (Before Taxes)
These figures represent gross earnings before taxes, insurance, 401(k), and other deductions.
- $5,000 per month
- $2,308 bi-weekly
- $1,154 weekly
- $230.77 per day
- $28.85 per hour
Net Income (After Taxes)
Factoring in taxes is hard to do on a general level. Many different components will affect the final numbers.
For the sake of this article, let’s base this yearly income on someone who lives in Detroit, Michigan.
Michigan has a 4.25% income tax. When you take the $60,000 income and factor in the income tax, you get a yearly take-home amount of $42,690.30. Let’s break that down:
- Gross Pay $60,000.00
- Federal Income Tax $4,169.70
- Social Security Tax $3,720.00
- Medicare Tax $870.00
- State Income Tax $2,550.00
- City Income Tax $0.00
- Deductions withheld $6,000.00
- Final Paycheck $42,690.30
Now take the $42,690.30 and the adjusted salary looks like this:
- $3,558 per month
- $1642 bi-weekly
- $821 weekly
- $164.19 per day
- $20.52 per hour
Therefore, someone living in Detroit, Michigan, can expect to make $20.52 per hour and see bi-weekly paychecks in the amount of $1,642 after taxes from a $60,000 yearly income.
If you would like to run the numbers yourself, check out this salary calculator.
How does a $60,000 salary compare to the average wage in the US?
When searching for a new job, it’s helpful to know whether the salary offered is something you can live on. However, that’s hard to judge just off the numbers alone. It helps to know what the average income is in the United States to have something to compare it to.
According to the wage statistics for 2020, 67.6% of wage earners in the US made less than or equal to $53,383.18.
U.S. Average Annual Income
The average annual income in the US for 2020 was $67,521. (census.gov)
U.S. Average monthly salary after taxes
The average monthly salary after taxes is $3,610.07 (numbeo.com)
U.S. Average Hourly Pay
The average hourly pay in the US for 2022 is $26.92 (tradingeconomics.com)
Average Cost of Living
According to Numbeo.com, the breakdown for the average cost of living goes as follows:
- If you’re single and do not have rent to pay, your average monthly cost of living is $939.16
- If you are a family of four and do not have rent to pay, your average monthly cost of living is $3,328.31.
If you have rent to pay, here is the breakdown according to bedroom and location:
- 1 bedroom apartment within city limits $1,370.28
- 1 bedroom apartment outside city limits $1,111.37
- 3 bedroom apartment within city limits $2,241.84
- 3 bedroom apartment outside city limits $1,814.59
Going back to our example of Detroit, Michigan, the cost of living is 3% lower than the national average. Housing expenses are 6% lower, utilities are 2% higher, and gas prices are 8% higher. (smartasset.com)
- If you are a single person living in Detroit, Michigan, you can expect a monthly average cost of living to be around $989.19 without rent.
- If you are a family of four living in Detroit, Michigan, you can expect a monthly average cost of living to be $3,406.33. (numbeo.com)
If you take on a job that offers $60,000, you will be getting just under the national average annual income but not by much. However, after factoring all that in, it is safe to say that a yearly salary of $60,000 could hold up well compared to the US income average.
What sort of lifestyle can I have with $60,000 a year?
Figuring out how much $60,000 can stretch depends on a wide variety of factors, like whether you are single, married, or have a family. It also matters where you live and how you budget your monthly expenses.
The advantage of being single while making $60,000 a year is that your salary can stretch much further than if you had a family because you only need to cover the expenses of one person. In addition, a single person will usually spend less than if they were part of a family, thus allowing them to live a more luxurious life on the same income as a person with a family.
If you are supporting a family on $60,000 a year, things get more complicated. The cost of raising a child born in 2015 from birth to 17 was $233,610 (this does not include the cost of college). This breaks down to $12,980 annually per child. If you have more than one, it comes out to the following:
- Two Kids = $25,960 per year
- Three Kids = $38,940 per year
- Four Kids = $51,920 per year
- Five Kids = $64,900 per year
Having kids understandably creates a sizeable dent in your yearly income, but you can still make it work if you consider where you live and your lifestyle choices.
You can live as a family in the US on $60,000, but you will not be able to afford everything you desire. To create more room in the budget, you might need to be a dual-income household.
Next, let’s look at what jobs typically offer $60,000 as a yearly salary and what states would be ideal to live in with that income.
What kind of jobs offer a salary of $60,000?
Here is a list of 39 jobs that start or have an average salary of around $60,000:
- Aircraft Mechanic
- Air Traffic Controller
- Asset Protection Specialist
- Boilermaker
- Cargo Pilot
- Cartographer
- Claims Adjuster
- Conservation Scientist
- Dental Hygienist
- Detective
- Electrical Forman
- Electrical or Electronics Engineering Technician
- Elevator Technician
- Food Scientist
- Forester
- Freelance Photographer
- Funeral Director
- High School Teacher
- Human Resources Specialist
- Industrial Designer
- Insurance Agent
- Librarians
- Makeup Artist
- Market Research Analyst
- Massage Therapist
- MRI Technician
- Pharmacy Technician
- Police Officer
- Power Plant Operator
- Public Relations Specialist
- Ranch Manager
- Respiratory Therapist
- Sales Representative
- Truck Driver
- Video Editor
- Web Developer
- Wildlife Biologist
- Yoga Instructor
- Zoologist
What are the best places to live with a $60,000 salary?
Living comfortably with $60,000 a year depends a lot on where you are located. In the beginning, we used Detroit, Michigan, as an example and found that you could live a modest life there with that income. But what if you wanted to move?
High Cost of Living State – New York
If you moved from Detroit, Michigan, to New York, New York, you would need to make a yearly salary of $141,818 to maintain how you lived back in Michigan with a $60,000 salary. However, if you tried to live in New York with a salary of only $60,000, you would be poor and have a hard time making ends meet. Why? Because the cost of living in New York is 129% higher than the national average and is 136.4% higher than in Detroit.
Low Cost of Living State – Tennessee
If you moved from Detroit, Michigan, to Memphis, Tennessee, you would only need to make $54,917 a year to have the same quality of life as you did with a $60,000 salary in Michigan. Therefore, if you lived in Memphis, TN, with a yearly income of $60,000, you could potentially be living a very financially comfortable life. Why? Because the cost-of-living ins Memphis is 17% lower than the national average and 8.5 % lower than in Detroit.
To stretch your dollar further in a high-cost-of-living place, you’d have to live a very modest lifestyle and prioritize where you want to spend your money and where you don’t.
In contrast, if you reside in a low-cost-of-living location, you can afford to live a far more luxurious lifestyle since living costs are lower. However, this could result in you creating bad spending habits.
According to Smartasset.com, the best places to live on a $60,000 salary comparing 9 different metrics are:
- Sioux Falls, SD
- Billings, MT
- Lincoln, NE
- Eau Claire, WI
- Wyoming, MI
- Appleton, WI
- Duluth, MN
- Omaha, NE
- Cedar Rapids, IA
- Lexington, KY
Regardless of your yearly income, if you can’t afford to live the lifestyle you desire, no matter how much money you earn, you need to make changes. No one should have to live a life stuck in poverty or unable to meet their basic needs.
How to Be Financially Stable
If you live a life free of debt and have smart money management skills, you can make almost any income level work for whatever lifestyle you want.
However, that is often not the case. So many people are stuck in the destructive cycle of living paycheck to paycheck.
But don’t worry. You can attain financial stability through almost all circumstances by doing the following steps:
Step 1: Figure out all the important numbers. You need to gather all your financial information and add it up to see where you stand. For example, you will need to know how much income you make, how much money you have in assets, your monthly spending, and how much debt you currently hold.
Step 2: Create a monthly budget. List all of your monthly expenses to see how much you spend each month then take that number and subtract it against your monthly take-home pay. This will let you know if you make enough to cover your basic needs. If you don’t, this will show you how much more you need to bring in. The monthly bills you should factor in are:
- Mortgage/rent
- Homeowner/Renters Insurance
- Car Payment
- Car Insurance
- Childcare/School Tuition
- Utilities (Gas, Electric, Water, Trash)
- Cable/Internet
- Streaming services
- Cell Phone
- Loans/Credit Card Payments
- Gas for Car
- Cost of Public Transportation or Rideshare (Uber or Lyft)
- Groceries/Household items
- Savings Goals
- Retirement
- Heath Insurance/Healthcare costs
- Entertainment (Eating out/Going Out/Movies/Apps/Online Services)
- Nonessential Secondary Expenses (Sporting Events/Concerts/Home décor)
Step 3: Automate your Bills and Savings. Once you get yourself to the point where you can safely automate paying your bills, do so. Set up multiple bank accounts. The first account can be where your paychecks get deposited, and then from there, the second account can be for bills. Take the money needed to pay your monthly bills and subtract that from your paychecks. Transfer that amount straight to a billing account and set up all your bills to be paid automatically through there. A third bank account can be for an emergency fund, and a fourth bank account can be for savings. You can use what’s left in your first bank account as house expenses like groceries or spending money.
Step 4: Emergency Fund. If you do not already have one, create an emergency fund.
Emergencies happen no matter how careful you are. Setting money aside to cover such expenses will protect your bank account and help keep you out of living paycheck to paycheck. A good starting point is $1000 and then expanding it to cover up to 3-6 months of your expenses.
Step 5: Live within or below your means. You don’t need to be extremely frugal, but spending less than you make each month will make it so that you can easily save for upcoming larger expenses, vacations, or other financial goals you might have.
Step 6: Pay down your debts. The dreaded “D” word. We all have it in some form, and we wish we could ignore it, but that is just a recipe for disaster. In step 1, you gathered all your important numbers, including your current debt. Take that information, and using the money you’ve set aside for this purpose, start paying it down. You can begin with debt that has the lowest payoff or the highest interest rate.
Step 7: Pay Yourself. It’s easy to focus only on covering your monthly expenses and taking care of debt, but you will truly never get anywhere unless you start paying yourself. This means investing in your future by contributing to your retirement or investments. It is said that a good number to reach is $1 million or more. However, don’t let that intimidate you. Any amount of retirement is better than nothing.
Step 8: Bring in a side income. If you’ve got the time, take on a side hustle. Side hustles are great for increasing a person’s income while giving them the freedom to work when they want and how much they want. For example, you could find a part-time job, do rideshare and delivery gigs, take on an online gig or create something to sell.
Here are a few ways to invest in your retirement:
- Opt-in when your employer offers a 401K match program with the minimum you need to qualify.
- After you’ve paid off your debt, start putting 15% of your monthly income into a ROTH IRA until you max it out for the year. Once that happens, take that 15% and add it to other investments you have.
Conclusion
$60,000 is slightly lower than the average US income, but depending on where you live and how you spend your money, it can be a comfortable income to live on.
No matter what income level you have, as long as you know how much money is coming in and how much money is going out and making your money work for you, you will live the kind of lifestyle you want.
