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January 25, 2012


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The changes in my life would be only having a company phone, living with roomates, no dog, maybe 2nd job,less retirement savings per yr, signing up for the income based repayment student loan option, more raman noodles, and less vacations.

I guess private school for our child would be gone, unless we could secure significant financial aid. I think I would find a way to make income from home (eBay or Etsy sales) and my spouse would take on some side gigs (tutoring or consulting). Vacations would be gone or significantly changed. Like you, taxes would be greatly reduced or eliminated.

I'm glad you did the exercise, although I must confess that I had the same response to this sentence -- "going through this exercise myself I now think that those making $50k have to make some tough choices and be diligent money managers" -- that you did to MSNBC's "well duh" intro. :) (And I don't mean that in a snarky way; but it really did *stun* me that you only now came to this realization.)

As to how to live on $50k - the principles of living frugally aren't really different than what you talk about on this blog. The differences are what is considered to be a "normal" lifestyle.

My family, for example - which does make more than 50k, but still has a modest income - never takes "vacations" except to visit relatives at Christmas...and we don't fly; we drive. This was how I grew up too, fortunately, so it doesn't feel like a huge loss. I can't even fathom having the money to budget to take the entire family to Disneyland, New York, or's completely outside the realm of my reality.

My wife and I were living on roughly 60k a year in the States, but that was gross and we were able to save close to 12k a year at that level. So I don't think at 50k our lifestyle would have changed much. We would probably save a bit less, but otherwise we would still go out to eat occasionally, enjoy vacations and splurge on shopping once in a while (her not me haha).

Now that we live overseas we are living on substantially less. Based on current exchange rates which are quite dismal thanks to the dollar weakness, we spend around $2800/mo or just about 34k per year. There's no saving at that level and very little giving, but we live quite well.

I would weep tears of happiness if I ever made as much as $50,000 a year. That's enormous. I've never made even close to that in all of my life. I'd be able to have a huge savings account, a place of my own, and be able to help others as well.

Combined incom of $50k a year would be difficult due to our current standard of living.We both know and realize this. We would have stayed in our old house ,Drive our cars longer, Not save as much for retirement and a rainy day, etc.

Since my wife and I both work and are over the $50k threshold we are able to save more, do more and not have to make those hard choices. We have friends who need to make those hard choices and are one emergency away from being in big debt. Sad but all to true.

However, we also work our fool heads off for that salary that we both earn. It is not easy having a job that commands a salary over $50k

I make $45,000 and live in the greater Boston area which is expensive. I'm in my mid twenties and single, so between living with roommates, driving an old car, and wathcing my expenses I save 9k/year and another 10K/year in retirement (including company match of 4%).

It's tough because I love to shop and travel, so I make a small budget for those items and cut the things I don't care about out. My friends are more care free with their money and that makes it harder to stay disciplined, when they shop and eat out multiple times a week. Finally, summertime is my ultimate budget-buster. For some reason I can't say no to going out once the weather turns nice, there is so much to do! Hopefully in a few more years I will have set up a nice foundation and increased my income so I won't have to work so hard later in my life.

I agree with HW's realization - yes, duh! We should ALL be diligent money managers, but as you say, few of us are. I also ditto BD's tears of happiness at making $50K. I'm SO CLOSE to breaking the $40K mark in my salary (even a 2% raise will bring me over that milestone, but I think I'll get more than that!).

If we're talking singular income, $50K would be great! If the household income dropped to $50K, though, it would be a completely different story (Honey makes about twice as much as me). I already have a second job, and we'd probably see if our friends would be willing to rent a room in our house from us. It would be an interesting challenge. Our mortgage payment (including escrow and some extra) is $2K right now... half of the "median" income.

I make 48k a year in the Wash DC/NoVA area and can't live on my own, even in the suburbs. Well, technically I could, but every dollar would go to daily living. At least my 401k is growing much faster than it would elsewhere, and my the increase cost of housing will be somewhat recouped after moving (assuming I buy a house in the next few years).

Maybe it depends on where that $50,000 a year is coming from. If two adults are only bringing in that much, that's two jobs that have to be fed, and jobs do cost money. Families like mine, where there is one bread-winner bringing in--well, pretty close to that--and one staying at home and managing things frugally, you can support quite a large family on that amount. We're expecting baby #5, and while the medical bills give us a few grumbles, we're not in debt, and we expect to have no trouble paying for it all. We're not so far ahead that losing a job wouldn't hurt us, but we've got a few month's buffer in savings. It has a lot to do with where you are, and with lifestyle.

First job out of graduate school 6 years ago: $43k. I'm up to a little over $51k now. Initially I had roommates but now I'm living on my own, which in this major midwestern city is relatively expensive (~1000-1100 for a decent 1br apt). As a single man and with perks from work it's more than enough income and I'm even saving money but I'm certain that if I had a family to support I'd be hurting.

I would love to make 50k a year, or 65k, or 120k, as some of your readers and posters do. Like BD, I would be overjoyed! Our giving and savings would go up and we could even buy a few nice things. Yes, even a few thousand dollars more a year can make a big difference.

I'm a single woman living in Connecticut. I own an apartment/condo (that will be paid off in three months)and am within two years of retirement. $50,000 is the bare minimum for a single person living in CT if s/he wants to own a modest home, drive a modest car for a long time, take modest vacations, and save money for retirement. I tell younger people to move to a part of the country that's cheaper.

The three biggies are housing, food, transportation. If you buy a small house or rent a small apartment, possibly have roommates, don't eat out too often, and own a used car with liability only coverage (or no car at all), you have a lot of flexibility with other parts of your budget.

I spend $1250 per month. $500 Rent, $100 utilities, $200 Food, $0-40 Transportation, $12 Cell Phone, $30 Health Insurance (would be $100 on private market), $20 Cat, $350 Discretionary (recreation, restaurants, buying "stuff", gifts).

I don't live on the coasts though but I still think it would largely be possible on the coasts; only the rent/utilities part of the equation would be affected.

The only thing I miss on occasion is not having a car, but I sure don't miss doing oil changes, gassing up, paying a car insurance bill, worrying about having an accident or break downs, etc.

I think there is a lot of room in a $50,000 budget.

I save about 80% a year after tax so it's not about making these choices out of necessity, I just think most things above and beyond this aren't worth the money they cost.

I live on about 22k a year. I made 56k last year. I still maxed out my 401k (22000) and my IRA (6000). I live a fairly frugal life. But, I am not hurting for anything and I'm happy with what I have. My home has been paid off for years. I have no children, so I suspect a great deal of my saving comes from that fact. I live in a rural area that is very close to some mid sized cities. I enjoy activities that are relativly cheap. Camping, hiking getting together with friends and playing guitars. I imagine if I had kids I would not be able to live so frugally, but I think this would only mean I wouldn't be able to sock away as much in savings.

FMF -- Given that you live in a more affordable part of the country, I'm a little bit surprised and humbled that you would be challenged to get by on $50K. About 8y ago my wife and I faced a similar scenario when I was out of work. I started looking at expense reports in Quicken and was shocked when I put together a budget in a spreadsheet. My wife was making a bit more than $50K at the time, but we (just two of us) were operating at a loss when on her salary alone. This budget did still include ~20% savings though. I guess that we'd be a bit closer to $50K if we ditched our savings, but it'd be very tight. (We live in a large metro area.)

WE live on 55k a year with a family of three eating an all organic diet and the kiddo goes to private school. It involves some incredible sacrifice. Data plan on the phone? HA! Not on your life! Cable? Puh-lease. My car is 14 years old, my husband's is 12. Vacations are spending a weekend at the lake in a bordering state. My house is tiny, but adequate.
It all depends what you value and how you plan to spend your money. We could make far better choices - we don't save as much as I'd like, and we go out to eat far too often, but I think we're doing okay overall. We're happy with what we have (though a few more toys would be nice ;) )

Great post. It is these kind of articles that really help us put our own lives into perspective and see how fortunate we really are. Ever since traveling to South East Asia last year I have been making a conscious effort to appreciate my life each day. I really am lucky.

Our income used to be 50k before we recently retired. We sent our kids through college and lived frugally and saved the maximum we could for retirement. But we lost most of our stocks, and now what we have in other savings is losing ground to the horrible interest rates and inflation of the cost of our basic living needs. What a nightmare. We are so sad that even our modest retirement dreams- eating out once a week, a concert once a year, visiting our families for holidays- these are becoming less and less attainable. I am feeling huge stress from these disappointments and am wondering where I have become such a failure. Looking back, maybe I should have taken vacations like my colleagues did and maybe I should have done more fun things. Way too late now.

I think the biggest thing to note (that some commenters have hit on) is that 50K is the median household income - so take that and manage a house with 2 kids. 50k is a lot for a single person to live off of, and really shouldn't require any sacrifices if you manage your money well. 50k is hard for a family of 4 to live on. Especially when you are looking at health insurance for 4 people, 2 cars, a house that fits all of you, etc.

Unfortunately I think there are too many people making well over 50k who really don't realize that its just not that easy to get ahead when you are fighting to keep your head above water.

I think that if many of us suddenly had our income cut to 50k, we have skill sets and drive that would enable us to find ways of increasing our income. I do feel sorry for those on this thread, and on previous threads, that struggle with the income side of the equation. The best solution I could offer is to seek out a mentor that could help directly and in more detail.

My husband and I have a family of four, live in a city with a $90,000 median income and gross twice that annually. However, we live on $58,000 per year, the rest all goes to our savings goals. We could start cutting out luxuries to get down to the $50k point, the second car would be sold, we'd take our kids out of gymnastics, give up our smart phones, maybe even rent out the guest room.

I think in all reality, though, we would just move. We live in an expensive metropolitan area because of the specific career opportunities afforded to my husband here. Without the job, we'd go live closer to family in an area with a lower cost of living.

My husband makes right around 50K and I am a stay at home mother to a toddler. We also have a dog. We live in the Pacific Northwest. We rent because we move frequently. We go on vacations, we save (not as much as I'd like, but we do), we go out to eat, we are not pressed to pay our bills (but we're smart about those bills - no fancy phones or data service, got a good promotion on TV.) We recently bought a second (new) vehicle that will be paid off by the end of this year. We are fortunate in that my husband's job has excellent medical benefits so medical bills/insurance rates are not a worry. We do live 2000+ miles away from our family and so we fly to them or occasionally pay for them to fly to us for visits.

I'd love to be able to save more, but we live a very comfortable life right now.

Piece of cake. Family of 4 lived on under $40k for many years in NYC with 2 kids (one with babysitter then day care, other in after-school). Took vacations too. Priorities and not going after the latest and greatest. It's not "downsizing and downgrading". It's simply living happy without extras. Being from former socialistic country certainly helps with this perspective. I re-married by now and with a husband who makes double of my salary (and still 2 kids), I hate how much we tend to spend, even if by American standards we are thrifty and save a bunch too. Wasting so much just makes me cringe.

Life is pretty easy when you are debt free, retired, and have a nice income stream from pensions, SS, and investments.

The group that things have become a lot tougher for, especially since our days, are the young families with teenage children.

Our three teenagers each worked several part time jobs. Cell phones, computers, cable, and the internet were still years away and gasoline was less than $1.50/gallon. Junior colleges were free, state colleges were very inexpensive, and only teenagers in the most affluent families had automobiles. When I obtained my MS in engineering in 1963, tuition only cost my company $30/semester unit at a private university.

We were able to buy a new 4br 3ba home in the heart of Silicon Valley for $26,950 in 1963, and a 3br 2ba cabin at Lake Tahoe for $16,000 in 1967.

I guess we just have to blame progress.

Life is pretty easy when you are debt free, retired, and have a nice income stream from pensions, SS, and investments.

The group that things have become a lot tougher for, especially since our days, are the young families with teenage children.

Our three teenagers each worked several part time jobs. Cell phones, computers, cable, and the internet were still years away and gasoline was less than $1.50/gallon. Junior colleges were free, state colleges were very inexpensive, and only teenagers in the most affluent families had automobiles. When I obtained my MS in engineering in 1963, tuition only cost my company $30/semester unit at a private university.

We were able to buy a new 4br 3ba home in the heart of Silicon Valley for $26,950 in 1963, and a 3br 2ba cabin at Lake Tahoe for $16,000 in 1967.

I guess we just have to blame progress.

It's worth pointing out that this is median HOUSEHOLD INCOME, not median WAGES.

Two income families with kids may have a lot more unavoidable expenses than single income families or families without kids.

Interesting bit of media-bashing you did there. Just curious, but if you were a reporter for a general-interest program, do you think you could do a series about the median income without mentioning that $50,000 goes a lot further in some parts of the country than others? If one of the interview subjects says the cost of living is high where they live, would you say "well, duh" to them, on the air?

I doubt if the series was intended to provide "new news," as you put it. Rather, it was intended to show what life is like for median-income earners. The results would, of course, vary depending on location (and on a lot of other factors). But guess what? Even you, the author of a financial blog, were surprised at how hard it is to live on $50,000. Well, duh.

I would have to have a roommate, and probably move much further out from the city than where I am now (would have to change name to Queens Money from Brooklyn Money, ha!). I also would have to stop the multiple international trips I take a year. My homeopath would have to go. I could do it, it just wouldn't be fun. Although the living situation change would cut my biggest spend in half or more.

Not that big of a leap here... only make a bit over $50k and I am able to support my family and still have a modest house, cable, cell phone, car, am able to take modest vacations, and I still put money away in savings. I lived on $20-$25k for so long that making $50k makes me feel darn near rich. I also do not carry any credit card debt, and I don't go out much or shop 'for fun' so I keep my expenses low. I also live in a relatively low cost area of the US (Houston).

I make around $42k and live in Austin. I'm single and own my own small home. I make it fine. I don't have loads of extra money and I could probably put more in savings (I get a 401k match up to 5% which I max out.) Even bought a car last year (a new mini cooper to replace my '97 grand cherokee!) All that said... I'm single which I think makes a huge difference.

I make $10 an hour as a sophomore engineering intern and I make all of my bills, as well as am slowly paying off the loan I had to take out, and I work about 32 hours a week while attending school full-time. I don't understand how people can't make it, I make my rent and utilities bills on time, I make my student loan payments on time, and I eat out once a month. Three months ago I bought a new computer, too. $50,000 is more than my family has ever made in a year, to think that someone "can't make it" on 50K seems silly to me.

Per my Reader Profile Post on April 26, 2011...I made just under 50K in 2011. I still saved over 13K for retirement and put some more away in cash. I am single and live in the high cost San Francisco Bay Area. Things I live without:

--Cable TV
--No i-phone or expensive data plan
--I drive a 15 year old car.
--No expensive pets.
--I live in a studio apartment.

I am fortunate that I can walk to work, so my transporation costs are low, but that has not always been the case, and may not be in the future.

50K is doable on the coasts for a single person. For a family, it's a miserable existence, but I supect 50K is an ok income in most of the rest of the country.

I make $150K/year. My total expenses are $30K/y and my tax bill amounts to another $30K. The remaining $90K go into my investment portfolio and retirement accounts. I'm 44 but I feel I came late to the party so I'm turbo blasting my retirement savings.

Honestly? I don't think I could go back to 50k for my household income. It woudl mean moving into a smaller house - which if it didn't have a separate office area, we would lose a nice chunk of change by not having a tax write-off for my husband's business. I mean, heck - between insurance premiums, and the cost of having a kid, that was almost 10k out of pocket last year for us. And that doesn't include the 80% of the premiums that my employer covered. There is no getting around the fact that the middle class is getting squeezed more and more in this country. You can no longer get a middle-class job without a college education, and with the price of tuition going up (even for community colleges, etc.) and starting salaries going down for people with degrees, it really is hard to get started. And I think one of the biggest problems faced today by people above the age of 45 is understanding that "kids these days" really can't pull themselves up by their bootstraps they way they used to be able to.

Now maybe you can understand a bit more how so many people get into debt and/or can't save enough for retirement. $50K with kids, even in lower cost areas, doesn't always go as far as you would like. You can cut and cut, but it can become a vicious circle.

Our household makes about $50K a year with me working full-time and my husband working part-time. Our infant son has a babysitter three mornings a week while hubby's at work and family help out the other two mornings (afternoons are "daddy time").

We don't live extravagantly, especially since we live in a major metropolitan area with a high cost of living. There are lots of meals at home, vacations are spent visiting family, we share one car and we consider our TV and Internet our entertainment.

But, we don't feel like we're missing out on anything either. I'm lucky that I have great health insurance and other benefits, and that I auto-save for retirement each paycheck. We have a decent emergency savings account, but we're working towards building it up more once we've eliminated the rest of our debt by 2013.

Our household is living on $36K a year of after tax money. $50k a year would net about $40-43K a year after tax depending on the state of residence...

That being said, living costs are much cheaper because there is no mortgage (only property fees of $150 per month), no health insurance (paid by employer or self insured).

There is definitely room to cut fat in this budget. We are eating out 3-5 times a week, and are taking 2-3 overseas vacations a year plus a lot of weekend trips (once a month) in the region.

Probably, with a lot of cuts we can bring the number down to $20k a year.

Would that effect our lifestyle?

Maybe... but a little more deprivation would make us appreciate the luxuries all the more when we do encounter them!


One thing I'd say is that if it takes 2 incomes to earn that 50K a year, I definitely wouldn't have kids unless grandparents are going to raise the kids during the day while the parents are out working. Way too much stress for the parents, otherwise, and the kids don't get the attention they need.

Assuming we're talking about a family of at least 3 people (50k is "rich" if you're single or just a couple), 50k is so close to the line where you don't have to stress about daily financial planners that it totally depends on your circumstances as to whether or not it's a lot of money. If you live in Houston or another low COL area then it's ample money. If you live in NY or LA then it probably is not a lot of money

I make just above the "median", and we have plenty of money left over each month to invest and spend as we choose. I also live in a state that has no income tax and is fairly affordable. When my wife goes back to work one day, we'll be "rolling" in it.

I'll retire three months shy of 67 in 15 months . . . will have income stream of $50,000.

Am a widow . . . no kids, no grandkids, no living relatives; just myself to support.

I live in a state that doesn't tax SS or defined benefit pensions; after working one full-time job for 40+ years (as well as a variety of part-time jobs) and paying all sorts of taxes, I finally see that I'll have enough income to enjoy a moderate lifestyle without being a financial burden to anyone.

I worked long, hard years to get to this point, and I hope my health holds up for another decade so I can enjoy my "golden years."

I'm a single mom with one teenage. I make $50K a year in the NY Metropolitan Area. I receive VERY little if anything for child support and unreimbursed medical expenses. The only debt I carry are the above mentioned medical expenses. My daughter recently got braces ($3500), dislocated her knee cap ($300 and counting) I am one paycheck away from being homeless. Five years ago, that same $50K, allowed me to actually live, go on vacation, eat out once a week, paid for afterschool care...and put something into savings.

In this discussion we should also assume a median cost-of-living area.

With that in mind, and in my short experience, a basic life seems to cost about $12k/yr ($1k/month). Think: student lifestyle: frugal housing/car but with some nice chunk change to have fun on weekends.

A more typical lifestyle seems to cost about double that($24k/person). Think: higher rent or mortgage, longer commute, frequent eating out, overseas vacation).

I haven't lived the 'nice' lifestyle yet, but my guess would be again double ($48k/person).

This means a family of four would cost about $36k for the basic, $72k for the typical and $144 for the nice lifestyle (assuming a kid costs half what an adult costs). That's about $40k, $100k and $200k gross income. Sounds about right, doesn't it?

It's very simple: just look at your salary and live accordingly, if you want to stay out of trouble.

P.S. my previous post disregards savings (add 15%).

I am 25 and making $50k/yr out of college. I live in the Boston area and find it hard to live off of, since I still have student loans and other credit card debt (Boston was expensive as a student). I do not use my cards anymore and pay everything in cash. I am still living at home, at least for this year then I plan to move in with my girlfriend who is a pharmacist making about $118k/yr. I feel like my bills are my bills and she should not have to pay for my education and she has her own student loans to pay off as well. I feel that education is a double edge sword because in order to do what I am doing I needed a bachelor degree, but it cost me around $100k. So making 50k a year is not bad, but my loans really put me in the hole and are taking a huge chunk of my income.

my husband and I have no incoming income since we lost our business. I am over 60 and husband is over 70. Our combined social security is 50k a year. We have gone through our savings and want to know how to proceed. Our one asset is our house, which we are hoping to sell for a profit so that we can change our lifestyle and have the extra income to live on. We also have a handicapped adult child living with us.

I think this post is talking about peole who make a combined 50k, not someone who makes that alone. Which explains the confusion.

My husband is 26 and I am 25 and we have a 7 mo old. Both of us are college graduates. We collectively make $58,000 per year. The three of us have individual health ins. as our jobs do not provide it, we each have life ins. plans, we pay car ins. on both cars, we pay $600 rent a month. We have had no family to help us so everything we have has been earned by the two of us. Unfortunately, we live paycheck to paycheck. Our insurance did not cover the cesearean because we didn't have maternity coverage. Therefore we have a mountain of hospital debt. But student loans are what is killing us.

we live in ct. my wife has been out of work for months and cant get work. we have 3 kids and a income of 56 thousand a year. Its really hard and according to food stamps and other assistance programs we make too much to get assistance. We are living pay check to pay check. and we are just making the bills with no money to do anything. And if we dont budget correctly we dont eat or get less gas. We have cabin fever because we dont have any money to ever go to a movie and or get gas for a joy ride. The cost of living has gone up beyond our income, Til my wife gets work we need to do our best to keep our heads above water. And sadly we are sure there are people in worse situations then us. Take care and i hope things will get better for all of us. ;)

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