As a small business owner and entrepreneurship consultant, clients often ask me about setting appropriate wages and determining if a salary will meet their needs. In particular, $60,000 per year is a common benchmark I‘m asked to evaluate.
In this comprehensive guide, I‘ll break down the hourly, daily, weekly and monthly pay for a $60,000 annual salary. I‘ll also compare it to national averages, calculate potential take-home pay, examine cost of living considerations, and outline common careers that pay this amount. My goal is to provide detailed analysis from an expert perspective to help you evaluate if a $60K income is suitable for your personal financial situation.
Breaking Down $60,000 Annually into Hourly, Daily, Weekly and Monthly Wages
First, let‘s crunch the numbers to convert the annual salary into hourly, daily, weekly and monthly wages:
-
Hourly Wage: Assuming a standard 40 hour work week for 50 weeks per year (allowing 2 weeks for vacation/sick time), $60,000 per year equals 2,000 working hours annually. Dividing the annual salary by total working hours gives us:
$60,000 / 2,000 hours = $30 per hour -
Daily Wage: Based on a typical 8 hour work day, we can calculate:
$30 per hour x 8 hours = $240 per day -
Weekly Wage: Multiplying the standard 5 day work week by the daily wage gives us:
$240 per day x 5 days = $1,200 per week -
Monthly Wage: Dividing the annual salary by the 12 months shows:
$60,000 per year / 12 months = $5,000 per month
So in summary, a $60,000 annual salary breaks down to:
- $30 per hour
- $240 per day
- $1,200 per week
- $5,000 per month
Having these figures converted into hourly, daily, weekly and monthly wages can help give you a better sense of how much this salary would provide on a frequent basis.
How a $60,000 Income Compares to National Averages
To provide context around whether $60,000 is considered a good salary, it‘s helpful to see how it compares to national income averages.
According to the U.S. Census Bureau, the median household income was $67,521 in 2020. However, this represents total income for an entire household, which frequently has multiple earners.
When looking at individual incomes, the average annual salary for American workers across all occupations was $56,310 in 2020.
This indicates that a $60,000 salary is slightly above the national average individual income. However, it is still considered within the middle class.
According to Pew Research Center analysis, the middle class in the U.S. encompassed incomes ranging from $48,500 to $145,500 in 2018 for three-person households.
So a $60,000 salary places an individual safely within the middle class earnings bracket based on national standards. However, cost of living considerations also come into play, which we‘ll examine next.
Calculating Potential Take-Home Pay from $60,000
While a $60,000 annual salary may sound decent on paper, your actual take-home pay can vary substantially based on where you live, your filing status, pre-tax deductions like health insurance premiums, and other factors.
But here is a general estimate based on national averages for federal taxes, Medicare/Social Security, and retirement contributions:
| Description | Amount |
|---|---|
| Annual Salary | $60,000 |
| Federal Income Tax (single filer) | -$8,366 |
| Social Security + Medicare Tax | -$4,590 |
| 401(k) Contribution (5%) | -$3,000 |
| Estimated Take-Home Pay | $44,044 |
Based on these common deductions, take-home pay from a $60,000 salary would equate to approximately $44,044 annually or $3,670 per month.
Of course, additional state and local taxes, health/dental insurance premiums, and other pre-tax deductions would further reduce your actual net income. But this provides a general estimate to work from.
Comparing Cost of Living in Different Areas on a $60,000 Salary
While $60,000 represents a moderately comfortable middle-class income on paper, its real-world value can vary dramatically based on where you live.
For example, in high-cost urban areas like San Francisco and New York City, this salary would mean a very modest standard of living. According to rental data from ApartmentList.com, average rent for a 1-bedroom apartment in these cities ranges from $3,500-$4,000 per month.
Meanwhile, a $60,000 income goes much further in more affordable regions like the Midwest and South. According to the same data, average monthly rents for 1-bedroom units in cities like St. Louis, MO and Memphis, TN are around $1,000.
Other factors impacting cost of living include daycare costs, property taxes, transportation expenses, and overall prices for groceries, utilities and other living necessities.
According to the Cost of Living Index from the Council for Community and Economic Research (C2ER), here is a comparison of overall cost of living for select cities:
| City | Overall Cost of Living Index |
|---|---|
| San Francisco, CA | 268 |
| New York, NY | 218 |
| Austin, TX | 105 |
| St. Louis, MO | 88 |
| Memphis, TN | 84 |
This index measures cost of living in relation to the national average of 100. Therefore, the higher the index, the higher the cost of living in that location.
As the data shows, a $60,000 salary goes more than twice as far in Memphis as it does in San Francisco, based solely on cost of living differences. Keep this in mind when evaluating income potential in the areas where you hope to live.
Creating a Realistic Budget on a $60,000 Income
Regardless of where you live, creating a budget is wise to ensure you live within your means on a moderate income like $60,000 per year. Here are some tips:
- Housing: Keep housing costs below 30% of your take-home pay, if possible. At $1,400 per month, you‘d be just under that benchmark. Getting roommates can drastically cut costs.
- Debt payments: Don‘t let debt payments exceed 10-15% of your take-home income. Avoid racking up credit card debt that is hard to repay quickly.
- Retirement & savings: Pay yourself first through automatic transfers each pay period. Target saving 10-15% of your income.
- Lifestyle inflation: Avoid dramatically increasing your spending as your income rises. Find ways to save more rather than inflating your lifestyle.
- Emergency fund: Having 3-6 months of basic living expenses set aside brings tremendous peace of mind. This should be a top savings priority.
- Discretionary spending: Allocate a reasonable amount toward dining out, entertainment, hobbies, and travel within your means. This helps balance saving with enjoying life.
Common Industries and Jobs Paying $60,000 Annually
While specific roles vary greatly based on location, experience level, and other factors, here are some of the most common industries, careers and job titles that pay in the $60,000 range:
- Healthcare: Registered nurse, dental hygienist, pharmacy technician, ultrasound technician
- Technology: Web developer, IT support specialist, software sales representative
- Business: Accountant, actuary, human resources manager, market research analyst
- Trades: Electrician, plumber, HVAC technician, auto mechanic
- Media/Communications: Technical writer, graphic designer, journalist, copywriter
- Government/Non-profit: Program manager, business analyst, grant writer
- Education: High school teacher, guidance counselor
- Law Enforcement: Police officer, detective
Of course, levels of experience, education credentials, and geographical region will impact actual incomes within these fields. But targeting these careers is a reasonable starting point when seeking a salary in the $60K range.
Key Considerations When Evaluating a $60,000 Income
As this analysis shows, whether or not a $60,000 annual salary represents a "good" income depends heavily on your individual circumstances:
- Your specific location will impact how far that salary goes due to wide variances in cost of living. Do thorough research on local costs.
- Your career field, skills, education and experience also influence earning potential. In some roles, $60K would be below-average.
- Don‘t assume salary and benefits are the only important factors. Also consider work-life balance, job satisfaction, culture and chances for advancement within a role.
- Crunch the numbers based on your particular tax situation and required expenses to determine if the hourly, daily and monthly income meets your needs.
- Always compare income offered to the going market rates for your industry and role in the geographic area to ensure you‘re being paid fairly.
The Bottom Line
While individual circumstances vary, a $60,000 annual salary breaks down to approximately $30/hour, $240/day, or $5,000/month. This places an individual in the middle class. With proper budgeting, this income can absolutely provide a comfortable lifestyle in many areas of the country.
Carefully consider factors like cost of living, career growth potential, and your personal financial goals when weighing a salary in this range. I hope this comprehensive analysis provides insightful data to help you make the best decisions in aligning your income, expenses, and lifestyle. Please reach out if you need any help assessing a job offer or structuring a personal budget. I‘m always happy to provide my expertise to help clients reach their financial goals.
