Is 45K A Good Salary For A Family Or A Single Person In 2023?

Crunching The Numbers

Let’s first explore the various numbers involved in a $45,000 salary. It would look very unusual if you got your entire salary at once. Therefore, it’s important to know how much salary you would get every hour or day according to the number of hours you devote to your job. 

Before accepting a job offer, you should always ask the employer about the number of hours you’ll be expected to devote weekly. The specific number of hours expected from employees is around 35 to 40 hours per week. If you’re lucky, some employers might also provide you with two weeks of paid vacation.  

1. $45,000 Per Year Is How Much Per Hour?

When jumping from an hourly job to a salaried job for the first time, it’s always advisable to calculate how much you’ll be paid on a per-hour basis. This way, you can estimate if a job is worthwhile or not. 

To figure out how much you’ll be paid per hour if your annual salary is 45k, let’s take an average of five working days, with 40 working hours per week. 

45000 salary / 2080 hours = $21.63 per hour

2. $45,000 Per Year Is How Much Per Month?

Following will be the calculation for per month’s salary:

An annual salary of $45,000 / 12 months = $3,750 per month

So, on average, you’ll earn somewhere around $3,750. 

3. $45,000 Per Year Is How Much Per Week?

When you get out of bed and rush to work, you might be wondering – how much will I earn this week for my efforts? So, assuming that you worked for 40 hours in a week, the calculation would come down to this:

An annual salary of $45,000 / 52 weeks = $865 per week

4. $45,000 Per Year Is How Much Bi-Weekly?

To calculate this, we take the average weekly pay of $865 and multiply it by 2, which comes down to this:

$865 per week x 2 = $1,730

Another way to calculate your bi-weekly income is as follows:

An annual salary of $45,000 / 26 weeks = $1,730 bi-weekly

5. $45,000 Per Year Is How Much Per Day? 

The amount of salary you will get per day depends on how many hours you work daily. Let’s assume an eight-hour workday. 

8 hours x 52 weeks = 260 working days

An annual salary of $45,000 / 260 working days = $173 per day

So, if you work ten hours per day for 208 days, you’ll make $216 per day. 

6. Let’s Sum Up

All the calculations are summed up below:

• Yearly Salary (52 weeks) – $45,000
• Monthly Wage – $3,750
• Weekly Salary (40 Hours) – $865
• Bi-Weekly Wage (80 Hours) – $1,730
• Daily Wage (8 Hours) – $173
• Daily Wage (10 Hours) – $216 
• Hourly Wage – $21.63
• Net Estimated Monthly Income – $2,863
• Net Estimated Hourly Income – $16.52 

Tax On Your $45,000 Salary

The elephant in the room, of course, is that you won’t see all of this money since a portion of it is paid out in taxes. So, after deducting taxes, is $45,000 a fair salary? 

It depends on where you live in America. There are around nine different states in America that don’t charge taxes on your salary. So, your earnings will increase if you’re lucky enough to live in South Dakota, Alaska, Wyoming, Nevada, Texas, Florida, Washington, New Hampshire, or Tennessee. 

However, in the rest of the country, a federal income tax rate is put on your earnings, and the rate varies according to how much you earn. There are seven different tax brackets that one should always take notice of. 

• Earnings up to $9,950 pay a 10% tax
• Earnings between $9,951 to $40,525 pay 12%
• Earnings between $40,526 to $86,375 pay 22%
• Earnings between $86,376 to $164,925 pay 24%
• Earnings between $164,926 to $209,425 pay 32%
• Earnings between $209,426 to $523.600 pay 35%
• Earnings over $523,600 pay 37%

As you can see, a person who earns a $45,000 salary annually falls under the 22% tax bracket. It means you actually pay:

• 10% on the first $9,950 of your earnings which is $995
• 12% on the portion of your earnings between $9,951 to $40,525, which is $3668.88
• 22% on the portion of your earnings between $40,526 and $45,000, which is $984.28

Thus, you don’t pay 22% of your entire salary. The combined tax bill of $5648.16 amounts to 12.55% of your $45,000 salary. At last, you’ll be able to take $39,351.84 as your annual salary. 

How Does A 45K Lifestyle Look Like?

We recognize that people’s attitudes toward money differ. To some, a $45,000 annual wage is insufficient to assure a luxury lifestyle. Others, particularly those living in cheap areas such as Alabama and Michigan, believe that the pay is sufficient to sustain them year after year.

In this regard, you may regard a 45K income as thrifty, whereas someone else may view the same money as an opportunity to live a luxurious life. If anything, life is full of variations, including our view of money.

Regardless of how we perceive money, the cost of living is typically a determining factor in the type of life that you can afford. The cost of living, which influences the type of lifestyle you can afford, is determined by your demographics, marital status, spending habits, and future ambitions.

How To Live On 45K

Every person is different from others depending on how one lives, spends, and saves the amount of money one earns. Therefore, what might be a lavish lifestyle for one person, might be a lowkey lifestyle for another. One of the most important things to remember here is that this area has no right or wrong. 

Everyone has a different lifestyle, which varies according to how much you earn. You should always settle for a lifestyle that suits you the best. The cost of living is one of the biggest elements in deciding your lifestyle. In America, there are three kinds of areas: 

• LCOL: Low Cost Of Living
• MCOL: Medium Cost Of Living
• HCOL: High Cost Of Living

When you decide to live in huge and expensive cities, maintaining your lifestyle would cost more than just $45,000. Managing your basic expenses like housing, food, transportation, and clothing would be difficult. These expenses would be very high compared to a city with a low cost of living. 

You would have to live a very lowkey lifestyle to save your money. Stretching your dollars would involve prioritizing where you should spend more. Those areas where you were spending money only for entertainment or enjoyment would have to stop. 

However, if you live in a low-cost living area, you can achieve a much better standard of living because the expenses would be less and more affordable. As a result, you can save more and spend on areas like entertainment and enjoyment. 

We have also seen that an annual salary of $45,000 is slightly less than an average American’s. Therefore, you need to be very cautious about spending money and dividing your expenses.  

1. What Lifestyle Can You Afford With An Annual Salary Of 45K?

If you don’t have any debt problems and utilize a proper money management system, you’ll be able to enjoy even with just $45,000 per year. Following are the ways through which you can do this-

• You should prioritize saving and keep around $3000 in your savings account in fifty-two weeks. 
• You should live in a decent neighborhood that is built either in a low-cost-of-living area or a medium-cost-of-living area. 
• Last but not least, apart from saving some money, you should be able to meet all the basic requirements of your life without much struggle. 

2. When Will A 45K Salary Hold You Back?

If you have a debt hanging like a sword on the top of your head, living with a salary of 45k annually might be a bit difficult. There are two things that might hold you back:  

• Break the vicious cycle of paychecks.
• Pay off all the debts as soon as possible and refrain from taking any more debts in the future. 

How Much Rent Or Mortgage Can You Afford?

The majority of budget experts agree on the fact that your house rent should not be more than 30% of your gross monthly income. If you make 45k annually, your housing budget should be at most $1250 monthly. While making $45,000 every year, you can easily rent or buy a house. But in such a case, you’ll have to focus more on saving and follow a strict budget routine.  

Maintain A Budget

Most people don’t care about making a budget. But they need to realize that the budget is very much similar to what you consume on a daily basis. For instance, if you want to lose weight, you should consume less and know exactly what to eat. You should look at budgeting like that. 

All the expenditures that you make are consuming your salary amount. To lose weight, you reduce the amount of calorie intake in your food. Similarly, if you want to save more money, try to reduce your expenses and think more about saving. However, a baseline is required. You must understand what you are spending every month.

You can even compare auto insurance quotes or move to a less costly condominium to make more place in your monthly spending. This category should not use more than 50% of your money. The balance, around 30% if you’re keeping track, can be spent on luxury costs such as dining out, beauty treatments, or splurging on clothes and accessories.

Is 45K A Good Salary For A Single Person?

We can simply answer this question with a “Yes.” If you’re earning only for yourself, there is no need to worry much about spending some part of the salary on self-pampering and entertainment. 

Also, a single person would spend much less than a family with two to five members. Not only the overall expenses, but the ideal budget you set for yourself is quite less. 

So, in our opinion, you can live comfortably with a salary of $45,000 per year if you live alone.  

Is 45K A Good Salary For A Family?

A major difference with a family is that you have to provide for more people than when you’re living alone. One major factor is that children’s education takes up much of your budget, which will largely affect your earnings. In fact, in simple words, this will put a huge dent in your salary. 

Now, the most important question arises – will you be able to provide your family with a good lifestyle by earning $45,000 a year? This is a difficult question because every family member has a different style of living, choices, and priorities that need to sync better with your income. 

At last, it comes down to two factors:

• The place where you live 
• Your lifestyle choices

While you might be able to live within this salary range comfortably, you might need help to afford everything. When handling the cost of a family with two to five members, it becomes easy to handle the costs if there are two earning members. If both members earn $45,000 every year, you can easily divide the expenses among yourself. The total salary comes to $90,000, which is a sufficient amount.  

Pay Yourself First

When you get your salary, remember to put a considerable amount of money into an emergency fund, savings account, 401K, or IRA. All of these come under an interesting concept of paying yourself first. The money you’re putting into all these areas is for your secure future. Additionally, IRA and 401K are great retirement plans; if you invest more money, your retirement life will be automatically sorted. 

Having an emergency fund and a savings account will help you a lot during times of crisis. If you have something big coming up, like buying a house or planning a vacation, then saving small amounts of money from your salary is recommended.  

Is 45K A Good Salary? 

While $45,000 will cover all your minimal and essential costs and at times, it might also give you a good lifestyle. But most of the time, you’ll not be able to spend on other things like self-pampering, entertainment, or other areas you usually enjoy spending time in. In such a case, you can opt for a side hustle. 

A side hustle will allow you to earn some extra cash above and beyond your salary. You can do anything you want as a side hustle. For instance, you can do freelancing, open a small business on Instagram, babysit, etc. 

Final Verdict – How To Maximize Your $45,000 Salary?

When designing a strategy for your monthly bills, the first step is to compensate yourself first.

Saving 15-20% of your net salary will allow you to prepare for the future and eventually commit to good financial habits. After you’ve set away your savings, the remainder of your earnings can be divided into required outgoings and luxury costs.

The initial of these subcategories will cover housing expenditures such as rent or mortgage payments. It would be best if you also considered how much you spend on transportation, whether it is auto loans, petrol, and insurance, or the expense of public transportation.

Other essential costs include your gas, electricity, and water supplies, as well as wifi, mobile phone, and even television subscriptions. Of course, there will be food! Even with all of your required expenses, there is always space to cut some of these prices.