If you’re an average “mean” American…
A little math humor for the nerds. I’m using mean averages, in the below math, not median. 🙂
If you make $60,000 a year, and you’re an average American worker, your gross average hourly wage is $33.80. This calculation uses 34.8 hours worked per week and 51 workweeks per year. That’s a total of 1774.8 hours per year of work.
- The OECD arrived at a similar total, 1767 hours per year per American worker. If you use this total, the average hourly wage increases to $33.96 per hour.
- If you plan on working 40 hours per week and taking 2 weeks of vacation per year, then $60,000 a year is $30 dollars per hour.
The last calculation uses 2000 hours per year of work. That’s a really good rule of thumb for mental math. Just take any salary and divide it by 2000 to get an estimate of your hourly wage.
Is 60k a good salary?
The short answer is no, it’s not a good salary. It’s an average salary. The average salary for an individual was $62k in 2020.
After taxes, a $60,000 salary is about $3800 per month in income. Plus or minus a few hundred bucks depending on the state you live in. If you’re young, live in a lost cost of living area, and are relatively frugal. You can live a fine lifestyle on this income. A $45,600 yearly budget is higher than the often-quoted $40,000 per year budget in the FIRE community. 4% of one million dollars is 4% per year in spending. It’s lean fire to me, and an OK to live. But I firmly believe high achievers, like yourself, need to aim higher.
Is $60K a year good?
Ok, we answered the question is 60,000 a good salary. What if we ask the question about a different type of income? $60,000 per year of passive income is great! An investment portfolio of stocks and bonds will have a much lower tax burden than earned income. So if your investments are earning you $60,000 per year, you’re in solid shape.
Run through a few different investment income scenarios using these tools.
You’ll see your taxes are almost zero most of the time! So with a low to no tax burden, you have a monthly budget of $5000.That’s my personal Lean FIRE budget. It’s solid frugal living but it’s not a bad way to get by. So to answer the question, is 60k per year good? It depends! It depends on the context and conditions of the question.