How much money is considered poor?
According to the most recent report from the U.S. Census Bureau, the poverty threshold for a family of four is $29,960. For an individual, the poverty threshold is $14,891.
The Census Bureau determines poverty status by using an official poverty measure (OPM) that compares pre-tax cash income against a threshold that is set at three times the cost of a minimum food diet in 1963 and adjusted for family size.
Pew Research considers middle class to be $56,000 to $156,000 for families of three. Thus, a family of three on $20,000 is not middle-class; it's actually below the poverty level. While an individual on $20,000 a year is not below the poverty line, they are still not considered middle-class.
Poor: Households in the 20th percentile, with a net worth of around $10,000, are categorized as poor. This group likely doesn't own a home and focuses financial resources on necessities.
| Family size | 2023 income numbers | 2024 income numbers |
|---|---|---|
| For individuals | $14,580 | $15,060 |
| For a family of 2 | $19,720 | $20,440 |
| For a family of 3 | $24,860 | $25,820 |
| For a family of 4 | $30,000 | $31,200 |
In 2023, the federal poverty level definition of low income for a single-person household is $14,580 annually. Each additional person in the household adds $5,140 to the total. For example, the poverty guideline is $30,000 per year for a family of four.
The U.S. Department of Health and Human Services uses the Census Bureau threshold to determine who is eligible for certain government assistance programs, like SNAP (food stamps). Under their guidelines, a family of four is considered impoverished if they earn $30,000 or less per year.
Living on $2,000 per month is doable, but you won't be able to live just anywhere. This is important because at the time of writing the average Social Security benefit paid is $1,701 per month.
To live on $25,000 a year after taxes, you would have roughly $2,083 a month to pay for everything —food, rent, medical bills, other necessities and leisure activities. That doesn't leave a lot of room for error. Something as simple as a car breakdown could tip your budget into the red.
Well, it depends. A $40,000 salary may be sufficient for an individual in a low-cost area, but it may not be enough for a family to live comfortably in most parts of the US. Rising inflation has made it more challenging to live on a $40,000 salary, but it still exceeds the poverty threshold for families.
What salary is upper class?
In 2020, according to Pew Research Center analysis, the median for upper income households was around $220,000 and the median for middle income households was slightly above $90,000.
Overall, the rule of thumb is to judge by your salary. Typically, by the time you enter retirement you want to have 10 times your annual salary saved up in your retirement fund. One common benchmark is to have two times your annual salary in net worth by age 35.
Middle-class income currently ranges from a little under $40,000 to a little over $119,000. The definition of middle class extends beyond income to factors like education, location and marital status.
Is $50K a Good Salary? Let's look at the facts: In the United States, the median household income is $57,617, which often includes multiple household members' incomes as well as side gigs. Considering that 47% of the country makes less than $50,000 per household, you're already in the upper crust.
A 2023 survey conducted by Payroll.org highlighted that 78% of Americans live paycheck to paycheck, a 6% increase from the previous year. In other words, more than three-quarters of Americans struggle to save or invest after paying for their monthly expenses.
| Household/ Family Size | 2024 Federal Poverty Level for the 48 Contiguous States (Monthly Income) | |
|---|---|---|
| 100% | 150% | |
| 1 | $1,255 | $1,883 |
| 2 | $1,703 | $2,555 |
| 3 | $2,152 | $3,228 |
Earning $25 per hour puts you well above the poverty line, especially if you're single. With careful budgeting and financial planning, $25 is still a viable hourly wage. Even though it's not a particularly high hourly rate, it's still well above the minimum wage rate in most areas.
The answer is yes, almost 1 in 3 retirees today are spending between $2,000 and $3,999 per month, implying that $4,000 is a good monthly income for a retiree.
| 1 ADULT | 2 ADULTS (BOTH WORKING) | |
|---|---|---|
| 0 Children | 2 Children | |
| Living Wage | $27.32 | $33.26 |
| Poverty Wage | $7.24 | $7.50 |
| Minimum Wage | $16.00 | $16.00 |
A $60K salary is around $14,000 less than the median household income in the country — $74,580, per the most recent Census data — which falls in the bottom half of earners. And at the same time, housing prices and mortgage rates seem to be getting higher and higher.
What is the average salary in the US?
According to the U.S. Bureau of Labor, the average U.S. annual salary in Q4 of 2023 was $59,384. This is up 5.4% from the same time period in 2022 when the average American was making $56,316 per year. Average weekly earnings reached $1,142, while the average American made $4,949 per month in Q4 of 2023.
| Middle-Class Income Ranges | ||
|---|---|---|
| Household Size: | Single | Five |
| Income Range | $30,000 - $90,000 | $76,000 - $210,000 |
| Median Income | $33,350 | $91,000 |
According to Maslyk, living comfortably on less than $2,000 per month during retirement is challenging. He emphasizes that even with a paid-off house, essential monthly costs can amount to about $1,200 per month. This includes expenses like utilities, internet, insurance, property taxes, maintenance and improvements.
Bottom Line. With $800,000 in savings, you can probably cover $4,000 in monthly living costs. However, retirement accounts alone cannot safely sustain that spending for a 25- or 30-year retirement.
Living on $1,000 per month is a challenge. From the high costs of housing, transportation and food, plus trying to keep your bills to a minimum, it would be difficult for anyone living alone to make this work. But with some creativity, roommates and strategy, you might be able to pull it off.
