What to do if income is not enough?
Get Help When You Have No or Low Income
⇒ Share housing & expenses with others. ⇒ Find services that will cut expenses in specific budget categories (e.g., food banks or free food distribution, vouchers for gas or laundry, etc.). ⇒ Arrange your life so you can cut expenses – move closer to work or services, use public transportation, car pool, cut to 1 car.
If you don't have enough money to live on, you might be able to get help to afford essentials like bills and food. This includes the Household Support Fund and cost of living payments. You should check if you can claim benefits - you might be able to do this even if you work, have savings or own a home.
- Work out your new income and expenses. ...
- Prioritize your bills. ...
- Contact your creditors before they contact you. ...
- Make specific and realistic offers to creditors. ...
- Consider getting legal advice. ...
- Don't take on new debt.
The 50-30-20 rule recommends putting 50% of your money toward needs, 30% toward wants, and 20% toward savings. The savings category also includes money you will need to realize your future goals. Let's take a closer look at each category.
The minimum income amount depends on your filing status and age. In 2023, for example, the minimum for Single filing status if under age 65 is $13,850. If your income is below that threshold, you generally do not need to file a federal tax return.
In 2023, the federal poverty level definition of low income for a single-person household is $14,580 annually. Each additional person in the household adds $5,140 to the total. For example, the poverty guideline is $30,000 per year for a family of four.
The 2023 federal poverty level for an individual was $14,580. So someone earning $24000 is about 64.6% higher than this threshold. However, the living wage for a single adult is estimated between $30,000-$45,000 in many states.
According to the most recent report issued in January 2023, the poverty threshold for a family of four is $29,960. For an individual, the poverty threshold is $14,891. The US Department of Health and Human Services (HHS) issues its poverty guidelines based on the Census Bureau's poverty thresholds.
The government does not offer "free money" for individuals. Federal grants are typically only for states and organizations. But you may be able to get a federal loan for education, a small business, and more. If you need help with food, health care, or utilities, visit USA.gov's benefits page.
What percentage of Americans live paycheck to paycheck?
How Many Americans Are Living Paycheck to Paycheck? A 2023 survey conducted by Payroll.org highlighted that 78% of Americans live paycheck to paycheck, a 6% increase from the previous year. In other words, more than three-quarters of Americans struggle to save or invest after paying for their monthly expenses.
Living below your means can allow you to save for emergencies and larger purchases, as well as have more financial freedom and confidence. Living below your means can also lead to less stress about money and the ability to build wealth.
It is recommended that you spend 30% of your monthly income on rent at maximum, and to consider all the factors involved in your budget, including additional rental costs like renters insurance or your initial security deposit.
Consider an individual who takes home $5,000 a month. Applying the 50/30/20 rule would give them a monthly budget of: 50% for mandatory expenses = $2,500. 20% to savings and debt repayment = $1,000.
- 50% for mandatory expenses = $2,000 (0.50 X 4,000 = $2,000)
- 30% for wants and discretionary spending = $1,200 (0.30 X 4,000 = $1,200)
- 20% for savings and debt repayment = $800 (0.20 X 4,000 = $800)
| Family size | 2023 income numbers | 2024 income numbers |
|---|---|---|
| For individuals | $14,580 | $15,060 |
| For a family of 2 | $19,720 | $20,440 |
| For a family of 3 | $24,860 | $25,820 |
| For a family of 4 | $30,000 | $31,200 |
If you qualify for tax credits, such as the Earned Income Tax Credit or Additional Child Tax Credit, you can receive a refund even if your tax is $0. To claim the credits, you have to file your 1040 and other tax forms.
You report the taxable portion of your social security benefits on line 6b of Form 1040 or Form 1040-SR. Your benefits may be taxable if the total of (1) one-half of your benefits, plus (2) all of your other income, including tax-exempt interest, is greater than the base amount for your filing status.
But data from the U.S. Census Bureau cites a different number as the average salary: just under $75,000. What does this all mean? By the Census data, it means that if you earn between $50,000 and $150,000 a year, you are considered middle class.
A $60K salary is around $14,000 less than the median household income in the country — $74,580, per the most recent Census data — which falls in the bottom half of earners. And at the same time, housing prices and mortgage rates seem to be getting higher and higher.
Is 30K a year poor?
No, $30,000 is not a good salary for a family with the cost of living in the United States. The poverty line for a family with four members is $26,200. That's only a mere $4,000 away from a $30K salary.
According to Maslyk, living comfortably on less than $2,000 per month during retirement is challenging. He emphasizes that even with a paid-off house, essential monthly costs can amount to about $1,200 per month. This includes expenses like utilities, internet, insurance, property taxes, maintenance and improvements.
| Rank | State | Income Required |
|---|---|---|
| 46 | Alaska | $71,570 |
| 47 | New York | $73,226 |
| 48 | California | $80,013 |
| 49 | Massachusetts | $87,909 |
Based on that figure, an annual income of $500,000 or more would make you rich. The Economic Policy Institute uses a different baseline to determine who constitutes the top 1% and the top 5%. For 2021, you're in the top 1% if you earn $819,324 or more each year. The top 5% of income earners make $335,891 per year.
The official poverty rate in 2022 was 11.5 percent, with 37.9 million people in poverty. Neither the rate nor the number in poverty was significantly different from 2021 (Figure 1 and Table A-1).
