In this article, we’ll discuss the important topic of: “Is 75k A Good Salary?”
Are you trying to live off 75k and wondering if that’s enough? Let us tell you that it depends. Most people who earn 75k live their life on a fixed budget. That does not mean it is not sufficient to live off 75k. When people say money can buy you happiness, our question is how much money can buy you happiness. Does buying a car make you happy? Or living on a budget and taking a trip at the end of the year make you happy? Similarly, some people say 75k is just peanuts, whereas some people are satisfied with the 75k.
We are going to discuss in detail, is 75k a good salary for a decent living.
Is 75k A Good Salary?
The amount 75k is said to be a magic number. The reason being, on average, every American can afford to pay off the necessary living expenses and have only a little to be spent on their desires. That means that 75k is just enough to support your family and buy what is necessary. It can never allow you to buy anything that you want.
Factors That Justify If 75k An Excellent Annual Salary
Multiple attributes decide if 75k is a good enough salary or not.
The Place When You Live
The location of your stay determines the cost of living and the various state taxes. In the United States, you will have to pay federal, local, and state taxes. However, there is no income tax in a few states, which means you get to take home more amount. But in some of the states, there was a fixed 5.1% tax. Different places have a different set of local/property taxes imposed.
Also, considering the location of your stay is essential in terms of the cost involved in staying. For instance, consider Silicon Valley. If you stay in Silicon Valley, 75k is a low salary. But you are planning to stay on the outskirts where the houses’ rents are cheaper, but you will have to commute for 2 hours, then 75k in Silicon Valley may just be okay.
Benefits You Get Beside Salary
The most important benefit that your employer should provide besides salary is health insurance. If your employer does not offer any health care, 75k can be tough to manage.
There are no mandatory sick leaves or vacations in the United States, which means you will not be paid when you are either fallen sick or need some time off work. If the health care plan covers you and your family and which does not have a co-pay or is very limited, then 75k is a decent salary to have a good living.
But if your employer does not provide that, and you have to approach a private insurer to get yourself and your family covered, be rest assured, you will have to face a hard time. Most private insurance has high co-pays with minimal coverage.
In between all this, if you lose your job, you still have to pay for the insurance while you are looking for a new job.
Savings for Retirement
What are your plans for retirement? In the United States, there is nothing called a pension scheme. Social security will also not cover someone 100%, mostly when they have worked their entire life in the United States. Therefore, you need to have some amount saved for your retirement.
There are a few employers who have a 401k Scheme. Under this scheme, you need to contribute a part of your salary, your employer also contributes something, and that amount is then invested pre-tax. This means that the money you will invest will reduce the taxable income.
If you have an excellent 401k plan and the market is stable, you will get a decent sum of money while retiring. Believe us when we say this, you do not want to be poor and old in the United States.
What Is A Good Salary for A Single Person in the US?
The cost of living in every state of the United States is different from the other. In a few states, a person can live off 23k, and in some other states, 40k is just sufficient to make their ends meet. Here are a few examples to tell you how much a person will need in each of these states to survive in the United States.
For Alabama, the required income is approx. 23k, for California, it is approx. 31k. For living in Florida, your income needs to be around 25k, and for Hawaii, your income has to be 32k. All these amounts are before tax reductions.
By now, you must have gotten an estimate on the amount you need to earn for a decent living in the United States.
To sum it up, 75k is not such a decent salary if you are the only earning member in the family and you do not get any extra benefits from your employer. Based on your quality of life, needs, and requirement, 75k can be a good salary if you live on your own. Therefore, we cannot say for sure if 75k a good salary, as it depends entirely on the factors mentioned above.
This video illustrated if 70k-75k good enough to live in the United States.