# Is 70k a Good Salary? Will I be Able to Have a Good Lifestyle?

\$70k sounds like a great salary, right?

Whilst earning \$70,000 a year puts you well above the national average median salary of \$53,490, whether it’s a good salary or not will depend on your lifestyle choices, your debt, and your expectations. Earning 70k a year is considered middle class income in America.

So let’s find out if 70k is a good salary” by working out exactly how much you can expect to earn per month, week, day and hour and how the way you live will affect how much cash you actually have.

## How much is a \$70,000 salary per month?

In an average month you will earn \$5,833 before any deductions such as tax. Once the tax has been taken off, your net pay will be approximately \$4,433, giving you an average yearly salary of \$53,196.

## How much tax will you pay on a \$70k salary?

Tax brackets determine the percentage of tax that you are expected to pay from your annual income. For taxes due in the 2021/2022 tax year there are seven federal tax brackets. These are 10%, 12%, 22%, 24%, 32%, 35% and 37%. A \$70k salary falls within the \$40,526 to \$86, 376 bracket which means you will pay 24% tax. 24% of \$70,000 is \$16,800, which means your net pay will be approximately \$53,200 unless you have any other taxable benefits such as healthcare coming out of your wages.

Each state will also have a different tax rate, so it’s important to know how much you will be expected to pay in your area.

## How much is a \$70,000 salary per week?

\$53,200 divided by 52 weeks is \$1,023 a week. If you get paid weekly rather than monthly, you will either receive four or five weekly pay checks depending on how many weeks there are in that month.

## How much is \$70,000 per day?

If you’re having a bad day at the office it can help to know how much you earn per day. If you work five days a week, divide your annual salary by 52, then divide it by five days per week. If you work fewer days, simply change the calculation to factor in how much you work. For example, your weekly pay based on a 70,000 salary is \$1,023 post-tax. \$1,023 divided by five equals approximately \$204 per day.

## How much is a \$70,000 salary per hour?

Now we’ve worked out the daily pay that you can expect to receive based on a 70,000 salary, it’s easy to find out how much you earn per hour. \$204 based on an eight hour day gives you an hourly wage of approximately \$25.50.

## What is the US median income?

The annual median salary or median household income for 2021 was \$53,490 per year. Both the median incomes are considered as a livable salary.

## Is \$70k a good salary?

Let’s now take a detailed look at the factors you need to consider before deciding if \$70 is a good salary for your individual circumstances.

### 1. Debt

Your monthly net take home of \$4,433 will soon disappear if a large part of your earnings is used to pay off high interest debt. Debt includes any credit cards, personal loans or student loans that you may have. Make a list of all your debts, in order of the highest interest. Prioritising debts will help you manage them. Start by looking at your budget and add in the total for your debt repayments based on how much you can afford to pay off each month (the more the better). Consider taking out a balance transfer to help reduce the cost of borrowing. The money you save on interest can be used the pay off the balance, rather than just the fees.

### 2. Location

If you want to live on the coast, \$70,000 might not be enough money to pay your bills and give you enough extra money for savings and having some fun.

Your outgoings will be directly impacted by the state you live in, so it’s important to understand the cost of living in your area before figuring out whether you are earning enough money.

Factors that determine the cost of living include:

Food – grocery prices can vary significantly across different states in America. For example, Honolulu pays the highest for their food each month whereas New Hampshire pays the least. The actual store that you shop in will also affect your total grocery bill. Don’t be afraid to shop around and switch to own brand products if you want to save money in this area of your monthly expenses.

Housing – the most expensive cities to live in the USA include New York, San Francisco, Boston and Los Angeles. If you’re on a tight budget, consider living in a smaller city or town instead.

Transport – commuting isn’t normally a choice, it’s a necessity. Working out your annual cost of car payments compared to using public transport will not only help you budget for this essential spend category but also determine whether it’s cheaper to live in another state.

Energy – gas and electricity rates will also depend on where you live. The rates you pay in your state will be determined by generation and transmission costs which are set by government regulation and consumption rates. Make sure of comparison sites to compare rates in your area and save on your outgoings.

Healthcare – the U.S healthcare cost is higher than the healthcare systems in other countries. Age, location, state laws and plan type will all influence the total cost of healthcare and health insurance. Make sure you fully understand the costs involved and budget accordingly for this essential area of spending.

Taxes – Some areas have a higher tax rate than others. For example, New York has high state taxes while Florida has no state income tax.

### 3. Monthly expenses

To work out whether \$70k is a good salary for your personal circumstances, you need to go through your monthly expenses first.

Gather at least three months’ bank statements and go through them in detail, making a note of each essential and non-essential transaction that you make each month.

Examples of essential spending include:

• Mortgage/rent. These are typically the biggest costs.
• Utility bills.
• Debt repayments.
• Car repayments, insurance and fuel.
• Food.
• Childcare.

Examples of non-essential expenditure include:

• Vacations.
• Coffee.
• Clothes.
• Entertainment.
• Eating out.

If your essential and non-essential totals equal more than your 70k income, it’s time to start reducing your outgoings. Start by going through your non-essential spend list and cutting out the areas that are costing you the most.

If your income is higher than your expenditure, you’ve highlighted how much disposable income you have that can be saved or used to pay off debt. It’s still a good idea to cut down on your non-essential spending areas to maximize your savings efforts.

Decide on a realistic figure for each of your spending categories and how much you will put aside for savings each month: this is your budget.

Once you have completed all of the above steps you will have a much clearer picture of whether earning \$70,000 is a good salary for you.

### 4. Number of people and earners in your household

If you live on your own and earn \$70,000 a year and don’t have anybody who is financially dependant on you (children or a spouse), then there’s no denying that you are in great financial shape. However, if you are a family of five and the sole earner of your household income, your earnings will be tightly stretched to cover all of the housing costs and other monthly expenses.

As a family, your budget is either:

Surplus – when your income is more than your outgoings, allowing you to save money.

Balanced – your income and outgoings are equal.

Family budgeting not only gives you control of your money, but it also eliminates unnecessary spending, keeps you out of debt and brings the family closer together. The key to sticking to a budget is finding one that works for you and your family.

Here are a few popular family budgeting methods to consider:

The cash envelope system – each of your spending categories is represented by an envelope. You then fill each envelope with the exact cash you need to spend on that area. For example, if you spend \$400 a month on your grocery shop, place \$400 in that envelope. Once you’ve spent all of the money in that envelope you can’t spend any more that month. Studies have shown that using cash helps prevent bad spending habits.

Pen and paper – all you really need to budget effectively is a pen and paper. Write down all of your expenses and categorize them into needs or wants. Next, add up your monthly income. If your outgoings exceed your income, you’ll need to make some cuts. Writing everything down helps many people to understand where their money is going and highlight obvious areas where spending can be reduced.

## What kind of lifestyle can you have on a \$70k salary?

The 50-20-30 plan is one of the most popular budgeting techniques that can be applied to any salary. Simply allocate 50% of your monthly income on essentials, 20% to your savings pot and the 30% left can be spent in any way you choose. So, based on this theory you can break down a monthly take-home salary of \$4,433 in the following way:

\$2,216 should be allocated to your essential outgoings such as mortgage/rent, utility bills, debt repayments, car repayments, insurance and fuel, food and childcare.

\$886 should be put into a savings fund that can be used for things such as paying off debt, emergencies, buying a home, retirement and your children’s future education.

The remaining \$1,331 can be used in any way that you want on non-essential purchases. Non-essential expenditure includes things you want rather than need.

## What to do with spare cash from your \$70k

If you’re a budgeting pro and have spare cash each month, consider the following points before deciding what to do with it.

Your financial situation: are you planning any big life events such as getting married or having children? Do you have high-interest debt that needs paying off?

Your goals and priorities: is paying off your mortgage early more important to you than saving for your retirement?

### Invest

Investing money can allow you to grow it and reach your long-term financial goals quicker. But it’s important not to invest in anything that you don’t completely understand. Here are a few investments to consider.

Stocks: if you want to invest spare money from your annual 70k long-term, stocks may be a good option for you. The simplest way to invest in stocks is through an online stockbroker. Once this is set up, start researching companies that you’d be happy to invest in from personal experience as a consumer. Consider starting small and only investing in single shares. You can always add to your portfolio over time.

Corporate bonds: company bonds are a great low-risk investment. You can select bonds that are only from large, reputable companies or bonds that will mature within the next few years. Although investments are never risk-free, bonds are generally a lower investment risk than stocks.

### Save

Pay off debt: debt impacts your financial security. If you have some extra cash, a financially-savvy decision would be to use it to clear debt.

For an emergency fund: cover three to six months of your living expenses. Look at your budget and total up the expenses that have to be covered every month. Multiply that figure by three or six to come up with how much you should put into your emergency fund.

For your retirement: even though you may be decades away from retirement, the earlier you start saving for the later years of your life, the more financially comfortable you will be once you decide to retire. Whilst many Americans believe that social security benefits will cover retirement expenses, in reality, this isn’t the case. Thanks to the wonders of new technologies and medical advances, people are living longer, which means that retirement funds need to last longer. Adding to your retirement pot now will take the pressure off saving for your retirement in the future and ensure you have enough money to live a comfortable life.

## Jobs that pay \$70k+ in America

If you dream of hitting the high five figure salaries, consider the following occupations:

Commercial pilot – the role of these pilots are to handle unscheduled flight activities, such as aerial application, charter flights and aerial tours. Other non-flight duties such as scheduling flights, arranging for maintenance of the aircraft and loading luggage are also completed by commercial pilots. Earn your pilot’s licence and high school diploma to get started.

Detective – if conducting interviews, examining records, observing the activities of suspects and participating in raids and arrests appeals to you, a detective is considered a well-paid job. You will need at least a high school diploma and some police departments may require a college degree.

Elevator installer and repairer – this role is in demand and can be very lucrative. After a four-year apprenticeship program you will be trained to install, fix, and maintain elevators, escalators, moving walkways, chairlifts and other lifts.

Funeral service manager – whilst this is a morbid job, it can be a highly rewarding and well-paid one. You’ll be responsible for staffing, marketing and maintaining revenue, but also at offering counsel and support to grieving families, arranging for the removal of the deceased’s body, preparing the deceased for the funeral, and filing death certificates and other legal documents with appropriate authorities.

Power plant operator – power plant operators control and maintain machinery that generates electricity and distributes power among generators. You’ll need a high school diploma and complete several years of on-site training and experience.

## So, is \$70k a good salary?

If you want to know whether or not \$70k is a good salary, take a closer look at your monthly expenses, lifestyle and the area you live in. These factors will allow you to figure out whether you can live comfortably on this salary or whether you will just get by.

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