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Eric Kayne for msnbc.com
Nathan Palmer, left, and Brett Jones at their home in Victoria, Texas.
Does $50,000 a year seem like plenty to live on, or not nearly enough?
If you said somewhere in between, that makes sense because $49,445 is the national household median income, meaning about half of all households live on more than that and half on less. The figure, based on 2010 calculations, was reported in September by the Census Bureau as part of an extensive report on income and poverty.
In some places and circumstances, $50,000 is enough for a large family to live comfortably. In others, it’s not even enough for a single person to afford rent, utilities and other expenses.
Four years into the deepest economic downturn in a generation, some Americans, especially those who have experienced bouts with unemployment, are overjoyed to be earning $50,000 a year. Others are devastated to have seen their incomes fall so far.
For some, it’s a mixture of both.
We recently asked the readers of TODAY.com's Life Inc. blog to let us know what it's like to live on about $50,000 a year, and we got hundreds of responses.
“While unemployed I would have been thrilled to make $50,000,” said Dawn Mogan, 55.
Now that she actually makes that salary after two years of unemployment, the single mom in Texas still worries constantly about money.
U.S. Census Bureau
Adjusted for inflation, median household income has fallen over the past few years.
Many of the readers who wrote to us say that on $50,000 a year they can put food on the table, pay for necessities and even splurge occasionally on a dinner out or a game for the family.
But others told us they have to watch their budgets closely and occasionally make sacrifices to get the bills paid.
“It's not poverty. We don't miss meals and we make MOST of our bills. However, we live paycheck to paycheck, and we carry debt,” wrote Brett Jones, 37, who lives with his partner in Texas.
Many feel like they are treading water — and for good reason. After adjusting for inflation, the nation's median income has fallen about 7 percent from its peak in 1999, reversing a fairly steady increase that lasted for five decades from 1950, according to Census Bureau figures.
The troubles started when the nation last fell into recession in 2001. From 2000 to 2007, household income was virtually stagnant, said economist Heidi Shierholz with the Economic Policy Institute.
“Even that was dramatic,” she said.
Then came the Great Recession of 2007-09 and its ugly aftermath.
From 2007 to 2010, the Census Bureau estimates that median household income fell by 6.4 percent, to $49,445, as unemployment soared to a peak of over 10 percent. (The jobless rate dropped last month to 8.6 percent — still high by historical standards although the best level in more than two years.)
Of course, median income varies a lot depending on what kind of household you live in. For families, defined as two or more related people living together, median household income was $61,544 last year. For single people, it was $29,730.
Gordon Green, a former Census official who is now a partner in Sentier Research, has been using government data to track monthly changes in American income levels.
He wasn’t too surprised to find that median income fell during the recession. After all, a deep recession combined with sharp job losses can be expected to have that effect.
But he was surprised to find that incomes have fallen even more sharply in the weak recovery period that followed the recession, even as the massive job cuts slowed.
He suspects that’s because some people held onto their jobs but saw their hours or wages cut, while others, after long periods of unemployment, were forced to take jobs that paid less than their previous positions.
Taken together, he said the median income decline from December 2007 to June 2011 "represents a significant reduction in the American standard of living.”
Even the relatively low rate of inflation that has characterized the past few years can start to add up if your income is not rising.
"Even if there’s 2 percent inflation, if they don’t get any raise that’s a 2 percent real wage drop,” Shierholz said. “That happens for a couple years, and that starts adding up to a serious decline of what you can buy with your paycheck.”
The outlook for the future remains uncertain. Diane Swonk, chief economist with Mesirow Financial, said one major problem is that even as companies start hiring again, there aren’t good systems in place to train people for work that requires skills but not a college degree. Those skilled labor jobs traditionally have represented a strong path to get into — or stay in — the middle class.
And even a college degree isn’t necessarily the guarantee of a comfortable salary that it once was.
And despite the November surprise of a sharp drop in unemployment, it could be years before enough jobs are added to bring the rate down to historical norms of 4 to 6 percent.
“Unfortunately, if there was a silver bullet to be shot it would have already been shot,” Swonk said. “We’re going to have to struggle through this time and adjust, and it’s a painful adjustment.”
Green saw a glimmer of hope in recent data that showed a slight increase in household median income to $50,257 as of September. But he said it’s too early to tell whether that’s a sign of better times, or just a fluke in the data.
To see what it’s like to literally be in the middle of the nation’s income spectrum, Life Inc. is hitting the road this week to profile Americans from all walks of life whose household income is around $50,000 a year.
We’ll be posting their profiles here and sharing our thoughts — and yours — on Twitter, Facebook and Google Plus. We also invite you to comment on our posts — but keep it civil and on topic, please!
Finally, please share your story of what it’s like to be living on about $50,000 a year here. We’ll feature some of your stories in future Life Inc. posts.
Related:
Poverty rate hits 18-year high as median income falls
Employment growth picked up speed in November
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Leave a Comment:
50K is just wonderful. However if you are over 50 yrs old nobody will hire you. Not even for 25K when you used to make 50K. I like HCC1 would be happy with 22K
Living in Az. making right at 50,000 a year with OT almost every weekend and just barely existing,no vacations,no extras, but at least eating.Am extremely upset that I cant do for my kids what my parents had done for me when I was their age.It is so disheartening to see the government wasteing so much of our money baling out other countries we are already supporting half or more of mexico.
Man making 50,000 a year ide have no problems i make around 15,000 now and im doing great its all about living at your means
To all the whiners on here: I bet you wish you paid more attention in high school (or didn't drop out.) Yes, intelligence is not everything (tears), but nobody is stopping you from giving your full effort to achieve your goals. Those who have both work ethic and smarts will reign supreme and make a LOT of money.
The average teachers salary here is $50,000. Are you saying teachers didn't pay attention in school, aren't clever, and don't work hard? Because, knowing a few, I know they are/did all those things.
Some will make more than others.... For example, I probably make more than most. But then again, I'm smarter than most. My associates do most of the work, but I've put myself in this position and I deserve it.
Well if they were clever enough, they would have chosen another career path where they could actually make some decent money.
Rob- Excess is addressing those that whine about their income... Many teachers are very intelligent and deserve every bit of what they make. Others enjoy working for 9 months and taking three off, which is fine. But those that complain their salary is insufficient are free to pick up additional work during break. Those that don't complain, kudos and thanks for everything you do!
So being intelligent and working hard ISN'T enough then? Only I thought that's what you said earlier.
Personally, I think teachers deserve something that is better than an average wage, because they do a difficult job that most of us (and I suspect you, because you don't appear to have a lot of patience) could not do, and that requires a high level of education that takes years to achieve. They also do something that actually contributes positively to society.
Keepin it real - and I am trying to illustrate the fact that you can be intelligent, and work hard, and still only earn at or below a level that is a struggle for a lot of people.
I'm making that point because of this notion that anyone who doesn't earn enough to live comfortably is not intelligent and doesn't work hard enough. that is simply not true, and comes across as pretty spiteful to me.
"I'm making that point because of this notion that anyone who doesn't earn enough to live comfortably is not intelligent and doesn't work hard enough. that is simply not true, and comes across as pretty spiteful to me."
False Statement.
Poor=Dumb and/or Lazy
@Excess: I actually dropped out of high school and still make six figures. It's not about school, it's about drive and ambition. It also takes a sense that you can achieve. I came from wealth, so I see money as easy to get; my wife was poor and thought it was hard to come by. Now, 10 years later she's making 4x what she did when I met her -- but only because I taught her how to do it.
Making money is easy -- if you know how.
You must be like Jesus or something. Did you turn water into wine too? I'm not a miracle maker but I take care of business. Dropping out of school is like rolling the dice at the casino. More than likely you're not going to win, but there is always that chance of hitting the jackpot.
I don't feel bad for a a teacher who makes $50,000. I am a public defender in the inner-city and I make significantly less than that. Meaning that I went through four years of college, graduating at the top of my class, then through three years of law school, then passed two bar exams and then passed the MPRE. My education was far more expensive and lengthy than the average teacher's and I make less. Add in 80-hour work weeks and constant beratement by judges, ADAs, our clients and the media to that and personally I think we have it about 100x harder than teachers. That being said, I love and appreciate my work and I assume that most/many teachers do as well despite the "low" pay. I think it's ridiculous for teachers to complain about $50,000 a year... that's good money for their educational level IMO. I wish I made more but this is the job I chose and if I wanted to make more I would have chosen a different area of the law or a different profession. Teachers are in the same boat. If they don't like their jobs or the money they can leave their profession and go back to school. No sympathy here! But I do have a great respect for teachers...
Teachers, cops, firefighters etc... are overrated at best. The people who deserve big pay days are getting them. For example Major League baseball players, politicians, and corporate executives. These people woke up one day and decided they wanted to be great. They may bend the rules sometimes (steroids, bribes, sending American jobs overseas...) but if they can get away with it, I would too. This is America the land of opportunity. We can freely make our own decisions.
Making roughly 400G a year but its been a tough road.. 4 kids and a mortgage. Summer camp we almost missed it (the kids anyway).. Only dropping 7 to 10 G a kid this Christmas, have to keep it real this year. Wife drives me crazy, cut back her shopping to 4 times a week, had to put the foot down.. and told her to take the Beemer, its more fuel efficient than the Benz's (all 4 of them). Also told the Fam to tighten up since heating the house is costing us close to 3G a month.. for Gods sake whats it take to heat 7000 Sq ft? highway robbery.. told the cleaning company I had to cut back this year too, they wont be coming in here every day, knocked them down to 5 times a week. and Vacations? nope, no longer doing what we do all the time, cut them down to 6, only 3 cruises this year. Yep, times are indeed hard, we will survive.. Have to keep the chin up.
Times are indeed tough when even white people have a hard time making a living.
I haven't lived on that little in 15 years. I'd have a hard time adjusting if I suddenly made just $50k. Of course, if I had time to adjust my bills (you can't always just cut them out quickly), and lived in an area with lower rents, I could survive. But I'd miss my current lifestyle, so I wouldn't stay at $50k for very long. I'd be working hard to get back to where I am now
Churchmouse has left the building. With a blinding headache.
We make a bit over 100k a year. We pay 27% in income taxes alone. We pay $8 grand, (around 6-7%) in property taxes for a 100 year old house on 5 acres in a rural area. We pay 8% in sales taxes. There are also taxes on utilities, vehicles, tolls, gas and other fees which are not normally counted as taxes but serve the same function as taxes. So I would estimate we pay 50% in taxes annually. Let me restate that....we pay the median salary in the US in taxes every year. We do not own our own business, we cannot write much off at all. So I am really, really sick of hearing how we must share the wealth. I think we are paying far more of our fair share as it is.
We make a little more than the median number with no children living at home and we are living paycheck to paycheck.
80% by our own hands
20% by Banks changing their terms
We have never ever paid anything late.
Bank of America rewarded my loyalty of 22 yrs of doing business with them by lowering my credit limits to the balance owed.
The credit limit I had with the card was $19,500. the balance was 3500.
My credit score dropped from 805 to 720 in one month. That triggered all of my other accts to lower my limits and increase interest rate. Never maxed out a card,never paid late. Never used a credit card for a vacation.
Oh and we are paying a mortgage on a house that has lost more than half of it's value. If it was just me I would walk away from it and go rent a efficiency apt. Let the stupid banks have it.
I have saved every receipt from 2011 and I will publish exactly how much an avg family TRULY pays in taxes every year.
So far early numbers show that we paid $250.00 in tax for the year for Utilities. Gas and Electric and phone.
Everything I buy I pay a tax. And that would be fine, if I felt as if everyone was paying their share.
I don't know how anyone can say with a straight face this is a Christian Nation when we are throwing families out into the street and children are go hungry.
This is a Nation of Greed and I am Mad as hell and I am not taking it anymore.
Christian Nation my behind, disgusting.
Busteroo, the credit card companies did the same to us - we stopped using it, and now pay cash. Once the balance is paid off, we are done with credit cards. We already cut the cards up. Now, I pay EXACTLY the price of an item, without all the added, hidden fees.
my gf makes 100k a year, I'll be lucky to make 4k this year .... lousy job market means another bad year as self employed
We pay almost $25,000 a year for our health insurance and medical costs. Live on $50,000? Not after we pay for health care.
When I moved to the USa, I had $500 which lasted me until I got a job that payed $ 4/hr. Back then this was a great salary for me. I spent, and sent money to parents. However, as time went by and my lifestyle became more mainstream "Amercian", I got into debt way over my head. I had credit card debt, a mortgage and student loans. I was miserable. Then I lucked out when I was able to sell my home for a gain that allowed me to pay off my credit card bills, my student laons and ofcourse the mortgage. I have been debt free for the last 10 years and much happier. I think we can manage on whatever as long as we do not have debt.
We live in a spoiled rotten society, where having a beautiful house, new car,cell phone, laptop, giant flat screen TV, kitchen full of electronic appliances, running water, bathrooms, showers, etc., is the "style to which we are accustomed". If we lose ANY of that, we are poor. Little does many realize, poor in the US are still better off than a large percent of the world population. We are in need of "downsizing" our lifestyle, to better fit our income. In 1994, I earned six figure income. Then, my corporation downsized, I lost my job. Instead of whining about it, I moved to another state to get work, started our lives over again, at a much (one fourth) less income. North Dakota has jobs available, but many people won't uproot themselves, suffer a few hardships, to gain new ground. Get yourself a camper, go to North Dakota, and stop whining.
You've got it all figured out, don't you pal. But, what do you thing would happen if 30,000,000 unemployed Americans all moved to North Dakota, gee, I wonder?
Most average workers in America have seen their real wages go down every year for the past 5 or 6 years. Pay increases, if any, do not keep up with the rising costs of everything, especially health care (but, of course we don't need any real changes there, with health insurance company CEOs pulling in 30 mil a year and their employees getting paid bonuses to find a way to deny approval for live-saving treatments!). Things are only going to continue to get worse for several reasons. First of all, the engine that drives America's economy is the middle class and if the middle class does not have money to spend to grow the economy, it never will. But, the current philosophy of many Americans is to attack workers rights, meaning that the wage deflation will continue, making a sustained economic recovery impossible, without government spending programs (like new infrastructure projects) to stimilulate it, but of course, the same people who don't want workers to have rights or be paid a fair wage, also are against stimulus spending (and vehemently against raising taxes for those who can afford to pay more taxes in order to reduce the deficits), so, really, why are so many Americans voting for Republicans? Isn't it obvious that they couldn't care less about you: the Average Working American?
I hear everyone talking about $50k as if you actually get the whole $50k. I hate to break it to anyone under $50k GROSS PAY, but Gross Salary and Net Salary are two different things dependent upon living situation. $60k to a single guy with no deductions (houses, kids, etc.) is about the same as someone making $40k and squeezes the tax system for all they can. And the other point I want to make is that IT IS MY RIGHT TO PURSUE HAPPINESS JUST LIKE ANYONE MAKING LESS THAN $50k, so get the hell out of my pocket.
The problem is that those who complain that $50K a year is not enough tend to live in major metropolitan areas like LA, San Fran, NYC, DC etc and have access to much greater amounts of services, culture, night life, etc but expect to only have to pay the same to live as those in the 'flyover states' without the same amenities.
Sure it would be great if we could all live comfortably on $50K a year, but it would also be nice if those in Ames, Iowa or Offut, Nebraska had access to the beaches of LA or the museums of NYC, but they don't.
Too expensive in your opinion where you live? Move, and give up all those benefits you've come to expect as part of your 'quality of life', else it's only fair that you pay more to have access to more.
I live in NJ, I make a fair buck but its ate up by taxes, EVERYTHING is taxed.. and guess what? They claim its not enough, the state wants MORE money.. they raised our property taxes (again).... they just tax the crap out of us.
A gay couple with the headline 'We are the new median' (implying we are the new 'normal') and a picture of two gay guys? This is communist propaganda.
I think part of the problem is that the standard of living keeps going up, with no relief in sight. As the article said, prices differ depending on region, but what's the point if the job markets are located in areas where rent and utilities are absurdly high? At some point, the cost for the basic necessities is going to have to level out.