Is 50k per year good money? (Living on $50,000 salary)

Is 50k per year good money and can your family live on that much money? Or is a 50k per year salary enough to keep you broke and barely surviving?

I’m assuming your household makes around $50k per year since you’re visiting this article.

How would you like to live comfortably on that $50k and stress less about money? Can you meet your financial commitments and goals earning $50k per year?

Luckily for you, it is possible to live on that much money. However, today’s article is going to answer the question, “Can I thrive on 50k per year?” Let’s take a look at what earning a $50k salary means for you and your family.

Is 50k per year good money (Living on $50,000 salary)

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How much is a 50k salary per month?

The easiest way to determine your monthly salary is to use a free paycheck calculator. Paycheck calculators are great at helping you determine after tax income.

I recommend using a paycheck calculator because after tax income varies depending on your situation. For example, your relationship status and your Federal, State, or Local allowances determine how much of your $50k salary you can keep.

Assuming you’re married and aren’t claiming additional withholding’s (e.g. claim zero allowances, pre and post tax deductions), a 50k salary is $3,498 per month.

tax calculator
Source: SmartAsset paycheck calculator

Paycheck calculators are great for estimating your income or evaluating how pay raises may change your income.

For example, maybe you want to contribute $300 per month to your 401k. Now your take home pay is $3,234 per month. Notice your take home pay is only reduced by $264. 401k contributions are pre-tax deductions, which means you are saving money on taxes.

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Is 50k per year good enough money to make you happy?

Did you know, money can buy happiness to a point? During a survey of over 450,000 people, maximum happiness is achieved at a yearly income of $75,000.

Income vs happiness chart

After $75,000, happiness begins to taper off. Therefore, you cannot expect money to bring you more happiness after earning a $75k salary.

So, how does earning $50k per year affect your happiness? People with a salary of $50k are still considered happy individuals, but have room for improvement. Unhappiness is significantly greater in people earning less than $40k per year.

How does 50k per year compare to the average family?

According to the United States Census Bureau, the average 2018 household income was $63,179. Therefore, earning a household income of less than $63,179 places you as below average.

Does it matter if a salary of $50k is below average?

Absolutely! Society has to be able to function so that the average family can live. So people earning $63k are doing ok for themselves. However, you really start to flourish when you earn above average income.

As previously mentioned, people earning less than $40k per year are significantly unhappier. Therefore, someone earning $50k is smack dab in the middle of unhappy, financially struggling, and people who are doing ok for themselves.

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Can you afford a house living on 50k per year?

So, is it possible to afford a house living on 50k per year? Let’s take a look at how much house you can afford.

According to Dave Ramsey, you should target your mortgage payment to be no more than 25 percent of your income. Personally, I think 25 percent is a little on the high side.

When you spend one-quarter of your household income on a house it can be difficult to build wealth. Once you factor the mortgage payment, utilities, groceries, and your normal expenses, the majority of your money is tied up.

You need to start investing as soon as possible to take advantage of compounding interest. It’s hard to save one million dollars when you aren’t investing.

As previously mentioned, a 50k salary is roughly $3,498 per month take home pay, not counting additional expenses. You’ll need to figure out your specific income situation, such as pre and post tax deductions or if you’re paid biweekly.

Therefore, Dave Ramsey says you could afford a monthly mortgage payment up to $874.50.

How much house can I afford on a $50k salary

Our best case scenario, you can afford a mortgage payment up to 874.50 per month. For most people, you would want to pay less than $875 per month if you’re making $50k. As always, check the paycheck calculator to determine your after tax income.

Using Zillow’s mortgage calculator, we can see how much house you can afford on a $50k salary.

Zillow Mortgage calculator 50k salary
Source: Zillow Mortgage Calculator


You could technically afford a $184,000 house assuming today’s interest rates and you pay 20 percent down to avoid personal mortgage insurance. However, you’ll need to keep in mind the cost of home maintenance and other factors.

Depending on where you live, you may or may not be able to find a house within your price range. Typically, people living lower cost areas will have an easier time finding a house they can afford.

Obviously, this is a lot of money and would be stretching your budget thin. Try and find something affordable that works as a starter home.

When you purchase a lower value home, you’ll end up paying less in interest. You can work on building equity in your home until you’re ready to upgrade to a nicer home.

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Summary: Is 50k per year good money?

As you can see, a salary of $50k is considered good money. However, there is ample room for improvement if you want to improve your situation.

The average household income is approximately $63k. Therefore, a salary of $50k is considered below average. People experience greater unhappiness when they have a salary of $40k or less. However, maximum happiness based on income is achieved at $75k.

I highly recommend using a paycheck calculator to determine your estimated take home pay. You can change your allowances, pre and post tax deductions to maximize your families income.

Every family should be budgeting and managing money effectively. Managing your money in a relationship is extremely important when you make $50k per year. Otherwise, it’s really easy to spend the majority of your money.

You may be able to afford a home on a $50k salary. Ideally, you wouldn’t spend more than 25 percent of your monthly income on a home. However, depending on your location, it can be difficult to find a home within your price range.