If struggling at $45K, can you imagine?

Question

I make $45K gross, take home $32K net, and we are struggling with bills, and can't save enough for a house fast enough.

Can you imagine how people working for $8-$12 an hour are doing? What about people making $12-$16 per hour?

I have to assume that 3/4 of The USA makes less than $20 or so per hour, and have no clue how much the pay ranges are above us! I'm not the only one struggling either at $45K, I asked some co-workers (who make MORE than I do!) about their income and expenses, I was AMAZED that I am not alone!

So, my QUESTION IS:

How does the "average" USA Citizen make it?
What are your ways of being frugal?
Also, if you want to answer, what gross pay range is considered "middle class"?

Any answers to this whole topic of "low income" are welcome!

LOL-I live in an apartment! Not even a "good" one! We can't afford it, and we have regular debt, a compact car, internet, cable, and utils, that's it! But then there are credit cards (2 small ones), and some old debt from my past. Not that much going on!

Answer 1

Well, this has a lot to do with...well a lot...

(a) where you live - if you live in a city, ANY city, your costs are going to be more significant that a rural area (I said rural, NOT suburban. For the purposes of cost, suburban might as well be 'city' or rural). The fact is that in parts of South Carolina and Mississippi you can live VERY comfortably making $14 an hour, while I know a friend in Seattle who was practically 'dirt poor' making $37k a year. Where you live and the cost of living of the area truly matters.

Even in the case of cities. I mean, I live in Baltimore, and its cost of living is relatively low compared to NYC, Seattle, San Fransisco, Chicago...get it? As someone said in a comment $65k in Orange County isn't a lot of money.

2) The average citizen DOESN'T make it, or not by much. The figure that came out in 2006 indicated that the amount of personal savings per American is a negative number; its the first time it's been a negative number since the Great Depression. What does that mean? The average American is deeply in debt. $10,000 of debt is NOTHING these days.

A shocking percentage of Americans are living paycheck to paycheck (which is defined as being unable to financially survive if one paycheck was not disbursed at any given time). This means it is rough for most everyone.

3) I have a lot of methods of being frugal, but my top ones are limiting myself to a daily budget, having an envelope in my bedroom that I put a dollar in every day (and deposit that money every 90 days in savings), and buying only what I need. I have to convince myself to 'impulse buy'.

4) The median income in the US is about $45,000 a year roughly, meaning 'middle class' would be based roughly off of that. So, anyone making $45k or more could be seen as middle class. Hah. Tell them that!

Answer 2

I think it depends on what area you live in... I live in Orange County and I make 65k per year, and I have no savings to speak of, a few grand in credit card debt, etc. (I need to qualify that by adding that my man brings in another 24k... so between the two of us it's about 45k per year each) I imagine I could live quite happily in a rural area in CA or some other state, but I actually have to juggle to pay my bills. I have no tips on being frugal, but I thought that this question was really interesting. I have often wondered how my fiancee and I will afford children, and even more amazingly how there are people working for less than 10 an hour (some with kids) and they make it.

Answer 3

Make a budget. Buy in bulk. I'm on a very low budget right now, living at home and trying to pay for college making 10 an hour. I would say to sit down with your spouse and figure out what to do.

First I can tell you that where you live will impact your money dramatically. West is a lot cheaper that the East. And did you know that if you make 30,000 than technically you are functionally poor? So technically, you guys should be able to make ends meet. Figure out what is weighing you guys down. Do you buy too much food? What kinds of food do you buy? Are you guys bargain hunters (and by that I mean, do you guys buy stuff just because it is on sale?)

I once heard that a good way to stop spending so much money is to figure out what your hourly wage is. lets say it's like 10 (for simplicities sake), and you want to buy a new shirt that is 20 dollars. Look at it and say is this worth two hours of my hard work? Translating it into work hours makes you think more about how much you may want something.

I think the technically middle class gross pay range is around 45-60K. I took a sociology class last semester and we talked a lot about poverty, class, and money.

Good luck!

Answer 4

I bought a house when I was only making $6.50/hour. I managed to pay it and a few 2nd mortgages off over the years. Including the year I was looking for work after being made redundant.

The "average" US citizen makes it by not buying everything they want when they want it. We save up for something, even if it takes a long time. Do you need it or do you want it, is an important guage as well.

Conserve where you can, don't eat out or drink lots of soda/beer/etc. Cut out the expensive things like cigarettes and going out to movies.

Get rid of cable/high speed internet/cell phone. Do your kids really need a cell phone? Limit long distance calls. Drop magazine subscriptions and go read them at the library.

Downsize if you can. It's OK to tell your kids "no, we can't afford it." They won't die from the disappointment of not getting the Dora The Explorer bedroom ensemble.

Walk or ride a bike if you can instead of taking your car. Which shouldn't be a big gas guzzling SUV or truck (unless you really need one for hauling). Plan your errand runs to make the best use of time and distance.

Shop thrift stores and rummage sales. Don't feel you need a new wardrobe every year with the name brand labels.

Make things for gifts instead of buying lots of stuff that they don't need or perhaps want.

Don't buy all the "toys" to keep up with the neighbors/friends. No swimming pool, 5 different video game systsems, upgraded computer every year, motorcycle, snowmobile, jet ski, boat, etc., etc. etc.

Most people are live for the moment, I want it and I want it now. They've been taught that by society and the media. You must have the newest, biggest, best and not make due with what you have.

Answer 5

Great Question! Personally, a lot depends on where you live and how many dependents you have first off. I am a stay home mother of 4 kids ages 6, 4, 2 and 5 months- (two in diapers!) A family of 6 making 30,000/year and we are making it. We are very frugal but have identified one very important concept which is called NEEDS vs. WANT. You must constantly ask yourself if what you purchase is a need or a want and how it will benefit you and others in your family. We do have issues with medical insurance since husband can not get insured through work but the state has a program that our kids qualify for. We have chosen this quality of life because it allows me to stay home and raise my own kids rather than working 40 hour weeks only to afford enough to pay a babysitter. I really beleive that the more money you make, the more money you spend. Some people with very high incomes have just as much debt if not more than middle class people because they have more pressure to keep up with thier competition and peers that they work with. It has a lot do do with where you feel you belong in the social class. If you want to appear rich and waste 300$ on a purse or shoes when you cant afford them, then you deserve all that is coming to you as you live a fake life. Being real is what its all about and trying to be happy with where you are in life rather than always feeling envious or needy of things is the best way to feel rich. We do a lot of shopping at consignment stores, and dont buy anything unless its already discounted or on sale in regular stores. We try to stay out of stores as much as possible in the first place and only buy what has been wrote on our grocery list. We got rid of our land line phone and stick to cell phones, use hand me down clothing, we dont have worthless trinkets decorating our house. I fix many things myself rather than buying new to replace them. Garage sales are great too.

Answer 6

i don't know that there is such a thing as an average citizin anymore. middleclass seems to be a thing of the past.but if i had to guess, i'd say middle class is about 50k take home per yr.
i'm not what you'd call frugal but i have friends who are. very. they know where are every penny goes. i have one friend who can tell you EXACTLY what something costs at the grocery store.very type A personality.i wish i could be that way sometimes. as far as diff. ways to save a buck, it varies. buying the cheaper brand of something,not going out,taking advantage of sales and 2nd hand shops and no impulse shopping are a good way to start.

Answer 7

First age does matter especially in your case. Why? He is married, and has a child. His responsibilities are different. You don't really have any yet. And do you really want to be a 2nd mommy to his child, and fight with his wife/ ex wife over the responsibilities of HIS child? Or will he really just leave his wife, and his child? What you value and what he values should be different. Coz you're both in different stages of life. You just finished high school (hopefully graduated) and should be considering attending either a community college, university or tech school. He should should've graduated by now, paid back most of his loans, and be considering his childs education. I seriously don't believe he would leave his wife, and child either. If he did. would you really want a man who left his child and his child's mother for another woman? Instead of dating a married guy with a family, why don't look for a single guy, with out one. If you are that lonely for attention, read a book

Answer 8

i hear ya man- i dont understand how some people working for less money than me are riding in these nice cars and buying new houses- the debt must be terrible

doesnt it make u sick how much money of yours is going to the government every year for people who are just plain lazy and dont work and just pop out the babies for the welfare and other benefits

my former neighbor had a whole mess of kids, didnt work, probably sold drugs, and had a link card to buy groceries and got government assistance on housing and utilities- so i moved instead of watching that fing place across the hall.


my ways of being frugal are not eating out very often- never going anywhere expensive to eat- luckily i am currently single so that saves alot

joined blockbuster online instead of going to the theater

moved in with a roomate to split expenses and moved 5 blocks from my office

trying to reduce my smoking habit in half- hopefully eventually i will quit

drink at home instead of the bar most weekends-

shop at walmart for pretty much everything from groceries to clothes

I cant save money fast enough either. 35K/yr, 23 yr old

Answer 9

Most people live way above what they make. I know people who can't pay thier bills because they need a $ 40k car, and every cable channel, a gym membershio they don't use ,over spending at X-mas, paying 100.00 a seat for a sports game. Living in a house, thats 2 thousand sq.ft. more then they need. Check your life style...Then ask the question again.

Answer 10

I agree...I think the gov. is trying to eliminate the middle class. We are going to have to move to a different town just to buy a bigger house for our growing family. Imagine making minimum wage!?