Is 35k a Year Good? 6 Ways to Live Stressless!

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According to the Federal Bureau of Statistics, the average yearly income in the U.S. is $51,480 in 2021. Anything above this number can be considered a good salary, which is still determined by the level of education and type of job.

So, it could sound impossible to cover your financial needs with anything below average, while paying for the student loan debt, covering expenses and health insurance, and being able to save money.

However, by rearranging spending habits and being smart in your personal finances, it is possible to live with a low salary. If you want to know how to achieve this, keep reading.

6 Ways How to Live On $35,000 a Year Stress-Free

Cut Unnecessary Monthly Expenses

Utter obvious though it may be, the first step is to identify what your unnecessary expenses are.

Necessary expenses are usually rent or mortgage, health insurance, utilities, or internet, and variable or unnecessary expenses relate to leisure, clothing, or travel.

It is important to carry out this classification by categories, in order to identify which are the expenses that you can and want to eliminate without affecting your lifestyle too much.

Once this is done, it will be easier to prepare a budget to set the limit of your expenses every month in each category, but do not think that having a budget means you have to give up your hobbies or your little quirks –more on this later!

Avoid Credit Card Debt

 CNBC reported in July that credit card debt among Americans is rising, as the savings rate “spiked to a level not seen since World War II.”

This “caused consumers to take the cash they had and pay down debt —and often the first kind of debt they paid down was cards, which have among the highest interest rates, averaging 16%.”

So, to avoid losing a good chunk of your pandemic savings to credit card debt, you should do your best to avoid this type of debt at all.

Credit cards have high interest rates and low minimum payments, and they are usually used to buy depreciating assets.

Investopedia’s list of six major credit card mistakes includes only paying the minimum balance, using this product to buy everyday items and pay medical bills, and taking cash advances.

So, acquiring credit card debt is a no-go if you want to live on $35,000 a year.

Avoid High Car Payments

 A high car payment is always linked to a new car. According to data by Experian, the average monthly loan payment for a new car in the U.S. is approaching $600, which certainly is more than 20% of your $35,000 a year’s monthly income.

Amid the pandemic, even loans for used vehicles have hit record highs, with monthly payments soaring from $18 to $413, averaging $400 for the first time. This is due to the increase in car prices amid the global chip shortage.

If you still find that a car is necessary, do your research on different financing options to avoid relying on car dealership financing alone. Also, be wise when choosing car insurance.

Also, extras will significantly raise the price of a vehicle, and be foxy enough to haggle with the dealer to lower the price.

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Avoid Eating Out at Restaurants

Don’t deprive yourself too much

In covid times, food delivery skyrocketed especially during lockdowns. Statista reports that in 2020, Instacart went from getting 820,000 orders in February to 9.14 million in April.

This only goes to show how food delivery became a comforting proxy, which in turn increased spending in this rubric.

Still, to live on 35,000 a year you must curb your restaurant spending without depriving yourself too much. This means decreasing frequency, but also applying some tips that will help you tail off the costs.

Many people are not aware of the specials that food establishments often offer. Not considering the special of the day or the special of the week is a costly mistake, so pay attention to the menu.

These deals are often offered at a significant discount or spread out in large portions to satisfy more than one member of the group. Keeping a list of bargains offered at popular restaurants and then consulting the list when deciding to go out is a good habit to develop.

Also being attentive to social networks will keep you informed and updated about the specials of your favorite restaurants.

Thrifty Shopping

There is absolutely no doubt that consumer spending plunged during the darkest days of the pandemic, and then bounced back in Q2 2021.

According to McKinsey, “Consumers’ pent-up demand and willingness to spend in some discretionary categories caused spending to grow at 20 to 30 percent year over year, reaching 4% to 7% above pre-COVID-19 levels.”

So, those who aim at living on 35,000 a year must be careful of not overindulging in unnecessary spending, especially in luxury consumer goods like smartphones, laptops, sound devices, and more.

If you feel you need to overhaul your closet, start by selling what you do not wear. Also, off-season shopping is a budget-friendly habit, as it is buying from thrifty stores, looking for coupons online, and shopping online for clearance sales.

Don’t Compare Yourself to Others

Dream Big

It is –to some extent– a controversial saying, but it holds truth when it comes down to living on 35,000 a year: sacrifice the present for the future, and dream big. Not everybody is willing to do so, but under this scheme, you can reap the benefits of a solid financial future.

This does not mean to live oblivious to the present moment in terms of leisure and having fun, but to carefully move around financially with purpose and aplomb.

Nathan W. Morris, personal finance expert and author of “Your 33 Day Money Action Plan” says: “The speed of your success is limited only by your dedication and what you’re willing to sacrifice.”

Living on $35,000 a year will help you gain control of your personal finances and branch out into passive income investments and pursuing side projects to make some extra cash –which can give you the chance to save cash.

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How do I budget $35,000 a year?

One rule of thumb is the 50-30-20 model. According to this, your needs, wants, and savings should represent that proportion respectively.

As an example, your 35,000-a-year income represents a $2,300 take-home pay –without factoring any further deductions. This way, 50% of such payments should cover your home needs, 30% would go to things you want, and the remaining 20% would be to save some cash.

With pen and paper –or with the use of any of the available budgeting apps– you make a list of all your sources of income, including every paycheck, regular side house, and also income from investment.

Then, create a list of all your expenses starting with the big sums like rent, and car payments, down to transportation, utilities, groceries, and any debt payments.

The next budget allocation is for the things you might want: clothes, eating out, and entertainment. And finally, cash for some savings.

CNBC’s Robert Exley Jr. writes: “Treating yourself is great, but you want to do it within your budget.”

“Don’t be discouraged if your finances don’t add up at first. The more you track your spending and keep an eye on it, the better you’ll be at homing in on your expenses.”

It is also important to keeping electronic records as this would help tracking your budget and expenses, and feel free to use apps that link credit and debit cards to the budget so you keep your cash within limits.

“Money can be tight, even if you’re doing everything right. But the best way not to be scared is to be prepared. And a budget is your first step.”

Want to Make More than $35,000 a Year?

Learn How to Make Money from Your Money

When living on such salary, it is possible to make some extra bucks if you make your money work for you –this is one of the most important personal finance pieces of advice. There are many ways to do this so you can generate solid passive income to also save money.

For a start, you can open a high-yield savings bank account. “high-yield checking and saving offer interest rates that exceed 1% —100 times what you’d get otherwise,” says Business Insider.

If you can do this on an online bank, it would be much better as they offer lower costs by ridding brick and mortar premises.

Retirement accounts are another solid alternative. Sean Gould, wealth strategist at Waddell and Associates, says “The key is to get money in a 401(k) …. Save as much as possible to have your money work for you tax-efficiently and to get money in the markets.”

“The first bucket outside of the emergency fund is the 401(k) up to the match [if your employer provides one]. You don’t want to give away free money.”

Invest to Earn Passive Income

Some extra cash can be gained through investments able to generate passive income. “People like the comfort of money in cash because they’re burned from 2008 and 2009, but inflation will eat away at your cash,” Gould says.

The reality is that investing in the market or in real estate is a great move since you can make money while your sleep.

Regarding market investments, it is important that you be patient, since, as Business Insider says, “Pulling money in and out to take advantage of favorable fluctuations and minimize the loss when the market dips is a strategy most experts advise against.”

On the other hand, investing in real estate is certainly an option under the right conditions. Since housing –as previous crises can reveal– is not a warranty, commercial real estate could be a good a suitable move, but always bearing in mind a diversified portfolio in terms of assets.

There are further options like CD ladders and annuities, and even selling items online like eBooks, creating online courses on e-learning platforms, and selling stock photos.

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Start Freelancing and Side Hustle

You do not have to confine your skills to your current job, as you always have the chance to make some extra money in other ventures.

Not only there is a financial benefit to it, but you can pursue a passion that you cannot explore that much given your job-related duties.

Still, side hustling should be done right. Before launching into a new job, you must evaluate your skills –writing, photography, or playing an instrument– and see which of them can generate extra income.

Besides, e-commerce undertakings are a good alternative, since the business has grown exponentially given the pandemic.

“If you are crafty, consider selling your products on Etsy. If you enjoy refurbishing products, such as furniture or technological products, you might sell these on various niche websites,” advises The Balance Careers.

Becoming a part-time realtor in the real estate business is also a good option, as you can exercise your time-management skills while starting a new revenue stream.


How much is $35,000 a year is how much an hour?

The Convert Units website has come up with a very thorough answer to this question, exploring a wide variety of scenarios.

Out of 50 full-time working weeks in a year and an unpaid 2-week vacation time, there are 2,000 working hours. With a $35,000 annual salary, the math says you make $17.5 per hour.

In the same scenario with no vacation time taken or a 2-week paid vacation, the hourly salary would equal $16.83 per hour.

Now, in a full-time job done every working day –no weekend overtime– and a total of 2,088 working hours in the whole of 2021, you would be making $16.76 per hour.

How Much is Your Paycheck if You Make $35,000 a Year?

In a full-time position, bi-weekly payment, with no overtime and 40 hours per week, you would receive 26 paychecks of $1,356.15, depending, again, on the contractual conditions with your employer. You can use salary calculators online to get more detailed information.

Can I buy a house making 35k a year?

According to estimates, a $35,000-a-year salary, with an interest rate of 3.75% and a loan term of 30 years –plus annual property taxes of $1,400 and a monthly debt payment of $300– you could afford a house worth $134,534.

There are several websites that can help you calculate this.

 Is 35k a year middle class?

Within the middle class, there is no doubt that less than $40,100 a year is considered low income. Middle income ranges between $41,000 and $120,000 and upper income is anything above $120,000 annually.

According to a Pew Research disclosed in December 2020, extrapolating the data to social class groups, $35,000 is considered lower-middle class.

Still, there are other valuables to factor in such as education, location, and family history to define social class.

Is 35k per year a good salary?

When compared against the $7.25 per hour minimum wage in the U.S., the $16.83 per hour out of $35,000 annually is certainly twice a good salary.

Still, as reported by the How To Fire website –which quotes the Bureau of Labor Statistics– “The average American makes $865 a week working full-time. That comes out to $44,980 per year.”

“If you’re making $35,000 you are below the average American. Depending on your financial goals, you may or may not consider adding additional streams of income.”

Final Thoughts

Although it might seem like a tough endeavor, living on this wage and being able to cover needs –health insurance, car insurance, monthly bills, phone bill, and student loan payments– wants, and also save a few dollars, is possible.

Not so much so if you tend to waste money, for which you would have to keep your splurges in check to remain –whenever possible– debt-free.

If you need more money, you can always find another string to your bow through passive income investments or side hustling.

But the key is to figure out a budget that will allow for a decent standard of living at a much lower income, and for this, a whole different approach to financial planning and budget management skills is required.