Personal Finance

What Is a Good Salary? And How Do You Compare?

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“According to the BLS, the national average salary in 2020 was $56,310. However, many other factors such as location and experience level can also affect what is deemed as a good salary.”

Though the answer to the question “What is a good salary?” can vary greatly depending on different factors such as country, age, and profession, it is still important to have a general understanding of salary information to help you decide on a suitable career path and improve your job prospects. By knowing what the appropriate salary is for your profession, you will be more empowered and better prepared to negotiate wages with your employer.

According to the Bureau of Labor Statistics (BLS), the national average salary in 2020 was $56,310. Though wages above the average could be seen as a good salary, there are no hard and fast rules regarding how to determine a good salary since there are many external factors involved. Below, we’ve provided some general information to help you evaluate your salary and find the appropriate pay range for you.

Factors That Can Determine a Good Salary

To determine whether a salary is competitive or not, here are several factors you should take into consideration:

Education

Though education does not always guarantee success in the career field, having a high school diploma and above will allow you access to more job opportunities. In addition, earning a degree from an established program in your field can typically elevate your chances of being recruited by top companies around the world. For example, with a computer science degree from Stanford University, your earning potential is significantly higher than possessing a similar degree from an unaccredited institution.

Experience Level

In general, the more experience you have, the more likely you are to receive higher pay. With the lack of skilled workers in the workforce today, many companies are struggling to find applicants who have enough experience and also meet the job requirements. As a result, salaries for these advanced positions are on the rise. If you’ve just started at your first job out of college, a lower salary is usually expected. But as you advance throughout your career, you should begin to see a steady increase in your annual income.

Industry

The industry you work in has a major impact on your annual earnings. Highly technical fields that require longer training, education, or apprenticeship typically command higher salaries, such as health care, engineering, finance, or architecture. If you want to maximize your earning potential, consider pursuing a career in a lucrative field you’re interested in.

Geographic Location

Even when the job title, experience, and level of education are the same, salaries across the United States can vary greatly depending on your location. This stark salary difference is mainly due to the varying degrees of local job demand, cost of living, and tax rate. For example, in San Francisco, the average annual income of a software engineer is around $102,606. Whereas in North Carolina, software engineers take home a much lower pay at around $75,104 a year.

What Is a Good Salary To Live On?

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It can be difficult to reach a consensus about what is considered a good salary. What one might regard as a decent salary may be unacceptable for another. Moreover, your spending habits, financial goals, amount of debt, and other personal factors can all influence your ideal salary. To find out how much income you’ll need to generate monthly in order to live comfortably as a single person in different U.S. states, use a cost of living calculator to compare locations.

Apart from obtaining a higher salary job to meet your monthly expenses, you can become more financially stable by maintaining a monthly budget and tracking your spending. Living below your means will allow you to build up your emergency fund, pay off debt, and have enough money to invest in your future. To motivate yourself to save up each month, follow a monthly budget challenge to hold yourself accountable.

What Is the Average Salary in the U.S.?

According to the May 2020 National Occupational Employment and Wages Estimates by the BLS, the average salary in the United States is $56,310, with a median wage of $20.17 an hour. As of 2021, it’s estimated that women in the U.S. earn around 82 cents for every dollar that a man earns. Though it is an improvement compared to a decade ago, there is still more work to be done to achieve equal pay.

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Average Salary in the U.S. by Age & Gender

How much women earn on a weekly basis at various ages:

  • 16 to 19: $467 ($24,284 annually)
  • 20 to 24: $607 ($31,564 annually)
  • 25 to 34: $850 ($44,200 annually)
  • 35 to 44: $999 ($51,948 annually)
  • 45 to 54: $1,002 ($52,104 annually)
  • 55 to 64: $946 ($49,192 annually)
  • 65+: $911 ($47,372 annually)

How much men earn on a weekly basis at various ages:

  • 16 to 19: $511 ($26,572 annually)
  • 20 to 24: $667 ($34,684 annually)
  • 25 to 34: $950 ($49,400 annually)
  • 35 to 44: $1,232 ($64,064 annually)
  • 45 to 54: $1,334 ($69,368 annually)
  • 55 to 64: $1,224 ($63,648 annually)
  • 65+: $1,102 ($57,304 annually)

Source: Economic News Release, BLS

Average Salary in the U.S. by Education

Note: All numbers reported are weekly earnings

  • Less than a high school diploma: $592 ($30,784 annually)
  • High school diploma: $746 ($38,792 annually)
  • Some college, no degree: $833 ($43,316 annually)
  • Associate degree: $887 ($46,124 annually)
  • Bachelor’s degree: $1,248 ($64,896 annually)
  • Master’s degree: $1,497 ($77,844 annually)
  • Professional degree: $1,861 ($96,772 annually)
  • Doctoral degree: $1,883 ($97,916 annually)

Source: Career Outlook

Average Salary in the U.S. by Industry

  • Food Preparation: $27,650
  • Health Ccare Support: $32,250
  • Personal Care and Service: $32,610
  • Farming, Fishing, and Forestry: $33,310
  • Construction and Extraction: $53,940
  • Education: $59,810
  • Art, Design, Entertainment, Sports, and Media: $64,400
  • Business and Financial Operations: $80,680
  • Architecture and Engineering: $90,300
  • Computer and Mathematical: $96,770

Source: Occupational Employment and Wage Statistics

How To Get a High-Paying Job

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In a recent survey conducted by the Society for Human Resource Management, 63 percent of employees say that salary level is very important to their overall job satisfaction. Of course, a high salary doesn’t always guarantee career fulfillment and happiness, but it can provide a certain level of financial stability to your life. Thinking about pursuing a job in a higher-paying career field but not sure how to go about it? Listed below are some tips to help you land a lucrative job in today’s competitive workforce.

1. Future-Proof Your Skills

With the rise of artificial intelligence and sophisticated technology, the nature of work is continuously changing and it’s important to keep up with the latest trends and develop skills that will be valuable in the future. For example, fast-growing careers such as data scientists and information security analysts are highly in demand nowadays due to the growing amount of data and cybersecurity issues in the tech industry. As a result, professionals in these fields often receive generous compensation for their work. Future-proof your career today by upskilling and remaining valuable in the workplace despite the ever-changing job market.

2. Seek Career Advice From a Mentor

A mentor can greatly accelerate your career advancement journey by guiding you in the right direction and providing valuable insights to help you achieve professional success. In addition, when it comes to seeking higher-paying job opportunities, a mentor can help connect you with the right resources, offer motivational career advice, and hold you accountable for your goals.

If your current employer provides a mentorship program, take advantage of it by asking your mentor questions about growth opportunities within the company and share with them your goal of obtaining a higher-paying position so they can better lead you in the right direction.

3. Become an Expert in Your Field

In 2018, over 7 million jobs were open in the United States, yet only 6.3 million unemployed people were actively seeking work (SHRM). With the growing skill gap in the workforce, businesses are experiencing increasing difficulty in recruitment and filling openings for highly skilled positions.

To gain a competitive advantage in the workforce today, one of the best decisions you can make is to become an expert in your field by investing in ways to advance your knowledge. Whether it’s through attending webinars, going back to school, or taking training courses, making the effort to expand your expertise can lead to career growth and salary increases.

4. Attend Networking Events

Did you know that 80 percent of jobs are filled through personal and professional connections? Networking events not only provide you with the latest knowledge about industry trends, but are also a great way to expand your network and build opportunities for yourself. Don’t forget to have your business card or resume handy and be ready to sell yourself and your skills effectively at these professional events. You never know when you might bump into someone who can help you achieve the high-paying career you’ve always dreamed of.

With a better understanding of how your salary compares in the job market and what factors influence your salary, you can now decide what is a good income level for yourself. As you advance in your career, you will most likely be compensated more for your experience in the field. However, even with an increase in monthly income, it is still important to wisely manage your money and track your savings regularly. Consider using the Mint app to help you on your budgeting journey and make the most of your salary.

Sources: | BLS | CNBC | SHRM | Living Wage | Washington Post | NY Times |

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