Is $80000 a Good Salary in the US?

$80000 per year is a very good salary for an individual in the US as it’s above the median. It’s important however to compare your salary with similar roles in other firms to get a good market-based benchmark for fair pay.

Of course income is one component, but you will have to consider your level of expenses to assess whether $80,000 is sufficient for your specific lifestyle needs.

Let’s dive in to the finer details.

What’s considered a good salary in the US?

A good salary in the US for a full-time salaried individual is likely to start at around $61,000. Let’s look at some statistics to put these figures in context.

Based on the latest data compiled by the US Census Bureau, for full-time year-round workers in the US, the median income is around $61,440. However these statistics vary dramatically across gender as men have a higher median income of around $66,790 whereas women are much lower at $51,200.

And if you’re wondering where on the scale a salary of $80k falls, here’s a handy chart generated by our income percentile calculator.

A salary of $80,000 puts you in the 76th percentile of overall wage earning population in the US. If you are a male, you would be in an estimated 69th percentile, whereas if you are a female, you would be in the 81st percentile.

It’s important to note that aside from gender, there are many other factors that decide how your salary stacks up: An $80k salary for someone in the food service industry might be fantastic; but for an AI engineer, it might not even make them want to get out of bed.

If you want to dig in to the stats based on factors such as education, occupation, industry, gender, race, etc. then head on over to our income percentile calculator. The data there is compiled from data generated by the Census Bureau and the Social Security Administration, so it should be very accurate.

Living Costs to Consider

An important aspect to consider whether you salary is considered ‘good’ or not is to see whether your income level is sufficient to cover your needs. Factors that can impact whether or not you have a ‘good salary’ for your needs include the following

Cost of Living

If you’re living in a Californian city as opposed to residing in the suburbs of Texas or Alabama, you’re likely to spend more money just to keep the lights on. Living wages in metropolitan areas will be much higher to compensate for this.

Rent, food, energy bills and transportation will all define whether or not you need to earn much more than the $80,000 as defined above. If you are a renter, in some cases you will have to demonstrate that your income is at least 3x the monthly rent payment. In such situations, with a salary of $80k before taxes, your ability to rent properties will be limited to those with a monthly rent of roughly $2,230 or lower.

Household Size

Of course, the size of your family will impact how much you need to earn. I’ll cover this in a little more detail for you below, but it’s simple math! If it’s just you and a partner, you’ll spend less, hypothetically, than if you have two to three children to feed and clothe.

Taxation

Taxes, of course, are where things can get a little tricky. The salaries I’ve discussed thus far are before you pay the IRS. The higher your pay, the higher your tax bracket. If you earn $80000 per year, you’re likely paying around $18,000 of that to the taxman – and that’s just based on current rates and figures.

Your mileage may vary based on the state you live in, whether you are married or not, and whether you have any other deductions that you can claim. Being married can make a big difference on your income tax bill, as opposed to being single – often by a couple of thousand dollars! If you earn bonuses on top of that, your tax rates can climb quite quickly.

If you own a house, you also have to remember that you will likely owe property taxes, which can be quite hefty in some areas.

Is $80k a good salary for a single person?

On average, the living expenses for a single person in the US are around $41,000 per year (~$3,420 per month). When considering that an annual salary of $80,000 after tax will amount to around $59-64k after taxes, you’re likely to be very comfortable as a single person.

You should have plenty left over to build your savings and emergency pot, invest to grow your wealth. In fact you can easily aim to save up to $2,000 a month! What’s more, you will easily have more left over to use for your personal pleasure!

Of course there are many factors that will be unique to your situation. Location and your spending habits will be the two biggest drivers of your expenses, so you will have to factor those in. Regardless though, a salary of $80,000 is very good for a single person to live on!

If you’re interested in seeing further detail of the breakdown of expenses, I’ve covered the typical monthly expenses for an average single person in the US. Check out the article for more details!

Is 80k a year good for a family of 4?

On average, a family of four (two adults and two kids) can expect to incur an annual expenditure of between $93,000 to $103,000 ($7,750 to $8,600 per month). A household income of $80,000 (pre-tax) is therefore unlikely to be sufficient for a family of four to live comfortably.

Remember that household income may be different than just your salary. If your household has two working adults, then your household income is the total of what both of you earn.

At $80k of household income, this chart shows that you would fall in the 50th percentile of the overall population. However once you factor in a family of 4, you would be well below the median household income of $118,464.

It’s important not to get dejected by this information though, as these figures are simply the average. Averages can be heavily skewed by high spenders, so if you can control your spending, you may be able to live comfortably on this income level.

Additionally, as you may have picked up by now, the location and its cost of living also matter dramatically. The $80k in family income is likely to go much further in Oklahoma than it will in California.

If you’re interested in seeing further detail, I’ve covered in detail the typical monthly expenses for an average family in the US. Check out the article for more details!

Is 80k a year good for a family of 3?

$80k a year may be insufficient, or at best, very tight for a family of 3. If we adjust down the average annual expense of a family of 4 to reflect a family of 3, it’s reasonable to expect annual expenses of $70-80k. A household income of $80000 (before taxes) is therefore unlikely to be sufficient for a family of three to live comfortably.

The median income for a 3-person household in the US is $102,276.

Is $80,000 a year considered rich?

Sadly, $80,000 a year isn’t considered ‘rich’ – if you mean completely financially free. It’s comfortable for single people to live on, but even then, costs are rising, and your living demands could change at any time.

Before we go further – it’s important to define the difference between your income and your net worth. In order to be rich, not only do you need to have a high net worth, but you also need to have income level.

‘Rich’, or at least ‘wealthy’, doesn’t appear to be a status you can achieve until you have almost $2 million in the bank. That’s according to the Modern Wealth Survey, which takes into account opinions of working people and families across the US.

You also need to take a look at who are the highest earners in the country, and what percentage they make up nationwide. For example, to be in the top 1% of earners in the US, you’d need to be making anywhere from $350,000, if you live in West Virginia, to over $900,000 if you live in Connecticut. And yes, I’m talking about how much you need to earn each year!

Unfortunately that $80k a year of salary may not even get you into the top 15% of America’s highest earning people.

So while $80,000 per year is respectable – and may be very comfortable for lots of people across America – it’s sadly not what you’d call ‘rich’. However if you save and invest your money regularly, you might well be on your way to becoming a millionaire.

Before You Go…

Our whole blog is dedicated to help you get on the path of financial freedom. Feel free to browse around and read through the articles.

In a nutshell, the fastest way to becoming financially free is to cut your debt, minimize unnecessary expenses, so you can save and invest your money!

There are plenty of investment books and podcasts that you can use as a learning resource along the way to help you reach your goal faster.

FAQs