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Written by Roger Wohlner on December 14, 2021
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Is $50,000 Per Year A Good Salary In 2023?

You’ve done it. You have landed a job in your field at a salary of $50,000. Go ahead and celebrate!

But once you come down to earth, you may quickly be asking yourself a pivotal question; is $50,000 a good amount of annual income?

The answer, of course, is not that simple. It has a lot of variables.

The median annual income in the U.S. as of January 2019 (the most recent data available) was $63,688.

Your goal, of course, should be to shoot for the stars and earn far more in your field as your career progresses. But let’s look more closely at this base salary of $50,000, and examine the question... Is this good money?

Here are some important tips to answer this question:

1. Taxes

Taxes are going to take a big chunk out of your take-home pay. After taxes, you will probably take home $32,000.

However, this depends on what state you live in. For example, New York has very high state taxes while Florida has no state income tax.

2. Location

Your geographic location is significant when you look at your salary. Across the U.S. costs of living vary enormously! Check out this breakdown:

Most Expensive

  1. Hawaii
  2. California
  3. Massachusetts
  4. New York
  5. Alaska

Least Expensive

  1. Mississippi
  2. Arkansas
  3. Oklahoma
  4. Michigan
  5. Tennessee

I'm sure this goes without saying, but a $50,000 salary will get you more in rural Mississippi than it will in NYC. That is why it is important to consider what the base salary is in your geographical area.

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3. Cost Of Living

Let’s say you’re living somewhere in between the most and least expensive states. What will you be spending for basic necessities?

Here are the key expenses to consider/factor in:


There is an extremely helpful 30% equation to predict this expense. In simple terms, the 30% rule recommends that your monthly housing costs not go above 30% of your gross monthly income. So, if you gross $5,000 per month, the max you should be paying for housing costs, including rent, is $1,500.


Food can easily put a strain on your monthly budget if you’re not careful.

Studies show the average American household spends between 12 and 13.6% of their salary on groceries and food outside the home. But it is possible to get a handle on these costs. In fact, the U.S Department of Agriculture’s “Thrifty Plan” for food budgeting says a two-person household can eat a nutritionally balanced diet for just $385 per month.

Notice this average household statistic includes food outside the home. That’s an enormous cache for everything from morning coffee to deli sandwich lunch to takeout Thai for dinner. These are all expenses you can rein in! Make a grocery list (and follow it) that includes foods for all your meals and make them at home.

Buy store brand items. Eat less meat. Clip coupons. Learn to cook Thai yourself. Buy cold cuts for that deli sandwich. Make your own coffee. Unlike rent, your monthly grocery bill is entirely under your control.


For most people, this category can be like a runaway train. The average Americans spends $2,504 annually on entertainment.

Where do your entertainment dollars go? Maybe you buy movie or concert tickets. Maybe your weak point is after work drinks with friends, or heading to your favorite restaurant every weekend night.

There are tons of ways to curb these expenses! Invite friends to your place and ask everyone to bring their favorite snacks. Stream a concert or movie. Don’t buy rounds of drinks for buddies, or better yet, have a backyard barbecue as a fun gathering. Be adventurous and switch things up.


One place where many people spend too much is subscriptions. The problem with a monthly subscription is that we often forget to cancel unused ones.

C0mmon subscriptions include the following:

  • Gym
  • Streaming (Netflix, Hulu, Disney+, etc)
  • Amazon Price, Walmart+
  • Clothing Purchases
  • Gaming services
  • Music Streaming (Spotify, Apply Music, etc)
  • Phone apps
  • Cloud Storage
  • Books (Audible, online magazine subscriptions)

It is important to understand your expenses and review monthly to see where your money is going. It is possible you have an uncancelled subscription. Maybe you are currently paying for Disney+, Netflix, and Hulu. Perhaps you can cancel one of them?

Subscriptions always seem like a small expense in isolation, but they certainly add up.


You will have other assorted expenses including gas (or public transportation), car insurance, cable and Internet and clothing.

Some of these are costs that are unavoidable. However, the clothing category is, and should be, something you keep an eye on. Yes, you need a decent pair of running shoes for the gym. But you do not need the latest Nikes. You may need a work wardrobe, but if you stick to basic styles, this doesn’t need to be extravagant.

Set a realistic budget that includes all your expenses just to track where your money is going. You may be surprised to see how much those premium TV channels cost you.

Emergency Fund

Most financial experts suggest that you should keep anywhere from three to six months of your take-home pay in an emergency fund.

You simply cannot predict what may crop up as an immediate expense. Maybe you have a sudden car repair. Or doctor’s bill not fully covered by insurance. Or the furnace breaks. If you set aside emergency funds, you will avoid the trap of paying with credit cards. This is an enormous problem for many adults!

The average person using credit has more than $15,000 in credit card debt — and economy-wide, consumers owe $729 billion. And that figure keeps rising every month when you don’t pay your balance in full. Cut up any cards you have, and don’t apply for new ones. Having an established fund for emergencies will give you peace of mind that you can manage whatever comes your way.


How much you should have saved is related to how much you earn.

One goal would be to have at least one year of salary saved/invested by the time you reach 30. The median salary for people aged 25 to 34 is less than $50,000. In fact, it is around $40,000. So, you’re looking at stashing away one year of your $50,000 salary towards retirement. Aim for this goal!

Most millennials, however, are nowhere near this amount, with some having no savings/investments. It may seem early to be funneling money into a 401(K) or IRA, but the truth is, it is never too early to start retirement planning if you want to live a modest lifestyle.

The Verdict

So, let’s revisit the original question; is $50,000 a good salary to earn?

The answer lies with you. If you live within your means, keep your spending for “needs” rather than “wants,” and follow a strict budget, you will have control over your money and have a good lifestyle.

It all rests in your hands! If you’re an impulse buyer accustomed to splurging and indulging, that salary won’t support your runaway bad habits. If you make a point of spending less than you make, you will be on the right track.

In general, you should look at this salary as a starting point. Hopefully, you have a job that has some upward mobility allowing you to earn more down the road.

Article written by Roger Wohlner
Roger is a financial writer who brings his extensive experience as a financial advisor to his writing. His work has been featured in TheStreet, Investopedia, Morningstar Magazine, Go Banking Rates, US News & World Report, Yahoo! Finance, The Motley Fool, and a number of other sites. His blog The Chicago Financial Planner provides information on a wide range of financial topics.

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