When on the hunt for a new job, one of the main priorities will be the salary or compensation package.
After all, this is why you work in the first place, right!?
You might be wondering, “Is $45k a good salary?” and the truth is, it depends.
In this post, I'll explore whether or not $45k is a good salary, the hourly rate of a $45,000 salary, and some tips to manage your money with this pay. Let's dig in!
Is $45,000 a Good Salary?
According to the US Census, in 2020, the median household income was just over $67,000. This means that for an entire household, the income was higher than a $45k salary.
However, if you're living in a multi-person household, this could be an above average income.
In 2019, the average income for a 40-hour work week was $88,672 according to the Bureau of Labor Statistics meaning a $45k salary would be just under the national average.
Earning a monthly income of around $3,750 should be enough to keep some of your monthly expenses paid.
Determining if $45k is a good salary will depend on where you live, your lifestyle, and other factors like the size of your family.
For example, if you live in New York City, it will be much more difficult to afford your lifestyle because of the high cost of living.
However, if you live in a low cost of living state like Indiana, Oklahoma, or Mississippi – you can stretch your dollar much further have money left over and live comfortably with a $45,000 salary.
In America's economic class, this would put you in the lower-middle class status according to USNews.
When it comes to worldwide income, this salary is much higher than many places.
Is $45,000 a Good Salary for a Single Person?
If you're a single person, you might be wondering if $45k is a good salary for just you.
The answer, again, is that it depends on where you live.
For some locations, this could be more than enough, while in other locations it might be barely enough money to skate by.
In general $45k is a good salary for a single person to live off of, especially if you can find cheap places to live.
While you won't live a lavish lifestyle with this take home pay, you'll certainly earn enough to get by.
For the average person, it should be easy to judge if $45k is a good salary by your own expenses.
Another consideration is if your work can be done remotely. You can achieve comfortable living if you can work remotely on this salary and live in a low cost of living location. For example, trying a digital nomad job with a $45k salary would be a great option.
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Is $45,000 a Good Salary for a Family?
For a family, $45,000 a year is less than the median household income.
After you pay taxes, it's going to be more difficult to meet your basic expenses, especially if you have a larger family.
Because the amount you spend on food for each person increases, it can be tough to afford your living expenses on this total income.
That said, if you have a spouse that works, this can make it easier for the average family to make ends meet.
Other Benefits to Consider on an Annual Salary of $45k
Some jobs might offer additional compensation like retirement options, health insurance, and even a bonus structure for you to earn more money.
Retirement Benefits
Retirement benefits can add to your total compensation and make your annual salary more appealing.
While this doesn't come with every job, this can amount to thousands in extra cash each year that's invested in your future.
If your employer offers a 401k plan, be sure to consider this when evaluating a new position.
Health Insurance
Health insurance is another benefits that is critical for full time workers. But not all health insurance plans are created equal and for some states, it's required for employers to provide access to health insurance.
Because of how costly the American health care system can be, finding an employer with superior health insurance offerings can save you thousands per year.
At this income level, finding a job that offers great insurance can be a make it or break it.
Bonus Structure
Some jobs will be upfront about the potential to earn an annual bonus. For example, if your yearly salary is $45,000, you might be able to earn an additional $5,000 in bonus money depending on the quality of your work and the companies performance.
While bonuses typically aren't guaranteed, it's certainly worth considering when determining if $45,000 is a good salary.
PTO
While paid vacation time is common for most full time jobs, check to see how much paid time off you'll get each year.
By factoring in PTO to your hourly rate, you'll earn much more per hour.
For a full time job, the standard paid time off is two weeks. But sometimes you can negotiate more.
Most companies will allow you to take federal holidays off or pay overtime for working these day. There are 16 federal holidays that should be accounted for.
$45k a Year is How Much an Hour
If you're earning a $45,000 salary, you might be wondering how much that is per hour. Ultimately, it will depend on how many hours you work each year.
Earning $45,000 a year is an hourly wage of $21.63 per hour assuming there are 2,080 working hours.
If you have PTO or time off, this will increase your hourly wage.
$45k a Year is How Much an Hour After Taxes
Unfortunately, Uncle Sam always takes his cut and therefore a $45k a year salary will quickly be reduced through taxes.
Between state and federal income taxes, social security taxes, Medicare, and FICA taxes – these can add up.
On average, if you earn $45,000 a year – your post tax income would be around $34,357.
If you live in a state with no income taxes, this amount could be much more.
This means your hourly wage after federal income tax and other taxes would be around $16.83.
For 2023, the federal income tax rates are as follows:
| Tax Rate | Income (Single) |
Income (Married) |
| 10% | Up to $11,000 | Up to $22,000 |
| 12% | $11,001 to $44,725 | $22,001 to $89,450 |
| 22% | $44,726 to $95,375 | $89,451 to $190,750 |
| 24% | $95,376 to $182,100 | $190,751 to $364,200 |
| 32% | $182,101 to $231,250 | $364,201 to $462,500 |
| 35% | $231,251 to $578,125 | $462,501 to $693,750 |
| 37% | Over $578,125 | Over $693,750 |
How Much is $45,000 Per Month?
If you earn a net income of $45,000 a year, your monthly income would be around $3,750 per month.
Keep in mind that this is before taxes.
If you assume your after tax income is around $35k, your monthly income would be $2,916.
$45,000 a Year is How Much Per Week?
If you earn $45,000 a year, your weekly income would be around $865 per week.
If you assume your post tax income is around $35k, your weekly income would be $673.
$45,000 a Year is How Much Biweekly?
Many employers will pay biweekly instead of on a weekly or monthly basis.
If you earn $45,000 a year, your biweekly pay would be around $1,730 per week.
If you assume your post tax pay is around $35k, your biweekly income would be $1,346.
$45,000 a Year is How Much Per Day?
Assuming you work a standard eight-hour workday, there are 260 work days each year.
If you earn $45k a year, your daily pay would be around $173 per day.
If you assume your post tax pay is around $35k, your daily income would be around $135.
Can You Live on $45,000 a Year?
Yes! It's possible to live on $45k a year in many locations around the country.
As long as you don't spend money frivolously and live a lavish life – you should be able to afford your expenses.
But there are a few tips to help you live off of $45,000.
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Open a savings account
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Build an emergency fund
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Earn passive income by investing with Acorns
Budgeting on $45,000 a Year
Budgeting your money is essential for anyone, especially if you make $45k a year. By using the right type of budget, you can make your money go further and ensure a stronger financial future.
There are a few main budgeting categories include:
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Housing costs (mortgage or rent)
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Utilities (gas, electric, internet)
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Food and groceries
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Clothing
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Transportation costs
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Medical costs
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Retirement savings
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Entertainment
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Schooling and education
To build a monthly budget, you'll first want to consider your take home pay as this is the money you'll have left to spend on your bills.
Next, try to determine your most important expenses each month, like housing, utilities, transportation, and food costs. You can look back to see how much you typically spend on these items each month.
After that, include any additional items such as saving for retirement, entertainment costs, or other expenses that you have.
You should be left with zero dollars when subtracting your total expenses from your income.
If you are left with a negative amount, you'll need to reconsider your spending habits or find ways to increase your income to balance it out.
Check out these budgeting tips for more help!
How Much House Can I Afford with $45,000 Salary?
If you have a yearly salary of $45k, the amount of house you can afford will vary depending on other debts and expenses.
Experts recommend that you should never exceed a 36% debt to income ratio when purchasing a home according to Zillow.
This means, assuming you have no other debts, you can afford a house with a purchase price of around $185,000 with a down payment of $20,000 on a $45k salary. However, this number will vary depending on the interest rate of your mortgage, your down payment, and the taxes on your home.
How Much Car Can I Afford with $45,000 Salary
Purchasing a new vehicle can be a stressful process, especially when it comes to the finances.
With car loans reaching record highs, it can be difficult to manage your money wisely and make the right decision.
So how much car can you afford with a $45k salary?
Most experts claim you should spend no more than 15% of your pay on a vehicle. In this scenario, your car payment should not exceed $437 per month.
If your bank account is drained, it might be wise to spend even less.
How to Make More Money with a $45k Salary
While $45k is a good salary, you might still be looking for ways to make even more money.
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Start your own business
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Invest in your future to make passive income
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Work overtime
There are tons of different ways you can make more money, but you'll have to put in the work to increase your income.
For example, starting a side hustle as a freelance writer can be an easy way to make extra money but it might mean spending your nights and weekends working instead of having fun! Just remember the opportunity cost of your additional work.
Final Thoughts on is $45k a Good Salary?
Making $45,000 a year is a decent salary depending on where you live, your expenses, and several other factors.
It's much higher than the minimum wage and you should be capable of covering your basic expenses with this monthly income.
The average American should be able to live a comfortable life with this income, especially if you live in a low cost of living area.
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