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How to Budget on a $50k salary: A Guide for 2022

Ever wonder what a typical budget should look like based on what you make? In this post we’re breaking down how to budget on a $50k salary.

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budget on a 50k salary

Congratulations! If you’re here, we’ll assume you’re currently earning around $50,000 annually. What’s your position? SCUBA instructor? Project manager? Star of a gritty Netflix adaptation of a children’s TV show?

Whatever it may be, we all have one thing in common — we need to budget our money. Without a solid budget, we might end up behind on bills, relationships, and the Netflix adaptation mentioned earlier.

Luckily, we’ve got you covered. Let’s break down how to budget on a 50k salary.

Assuming you’re on the younger side and single (it’s okay, budget through pain), this plan goes over the recommended allocations to budget on a $50k salary. Ready? Let’s go!

Budgeting on a $50k salary


Taxes & After-Tax Income

While tax evasion might seem fun and sexy in a Martin Scorcese kind of way, it’s generally not advisable. State tax rates vary greatly — since we don’t have the scope to dive in full right now, use tools like the ADP Salary Paycheck Calculator to determine your take-home pay. 

Since you’re making around $50,000 a year, you’ll probably end up paying the government around $10,000 in taxes annually depending on where you live (a little over $830 per month). That brings your annual take-home pay down to $40,000, or around $3,333 monthly.

Debt, Savings & Emergency Fund

Your debts, loans, and savings (oh my!) are the next items you want to tick off on your budget to-do list. According to the 50/30/20 rule, you should set aside 20% of your income for your financial goals. On a $40,000 annual salary, that’s $8,000 per year and $666 per month.

Here’s how that might break down:

    • Student loan payments. On average, these are close to $400 monthly
    • Rainy day funds. Your emergency fund should cover three to six months of your after-tax salary. On the lower end, if you’re aiming for $10,000 saved up over four years, that’s $208 monthly.
    • Saving up for a mortgage. If you’re considering a down payment on a house, you can start by contributing as little as $50 per month into a savings account.

These are just examples of expenses — your debt and saving strategy may be entirely different.

Housing & Rent

Put aside 30% of your monthly income for rent or housing payments. Ideally, you can find a Pinterest-worthy place that’s even more affordable, but matching this figure will keep you comfortably within budget. Given a $50,000 pre-tax income, that comes up to $1,000 monthly for rent money alone.

Utilities & Insurance

One budget item people often forget is their utilities. Average prices for some essentials include:

  • Electricity and gas (or just energy overall, which covers cooling and heating) – $170 monthly.
  • Water – $71 monthly.
  • Internet – $60 monthly.

And more! Assuming you don’t pay for cable (because why on Earth would you? NBC doesn’t have Outer Banks) and you live in a state with a moderate climate, you’ll probably end up paying between $200 and $300 per month on utilities (maybe even lower if you rent or split the cost with roommates). 

Let’s also throw in the various insurances you might have to pay, like home or renters’ insurance. Your premiums can vary based on your age, location, and past life (two truths, one lie) but it can go from $25 for renters up to $100 for homeowners. Fingers crossed your employer covers the rest!

If we shoot down the middle and say $300/month, you now have around $1,370 left per month.


Walking everywhere might be beneficial for the environment and the glutes, but you’ll probably need some other way of getting around sometimes. 

You should spend about 10% of your monthly income on transportation, so about $333 in our case. If you have a car, make sure to factor in monthly gas spend, insurance, and maintenance. We’re down to our last $1,000 per month!

Food & Dining

Like opinions about pineapple on pizza, monthly grocery and dining costs differ from person to person — find out yours using a calculator. Typically, it will be around $200 to $300 per month, depending on your dietary restrictions and preferences. Let’s add another $50 to $100 for home necessities like toilet paper and dish soap. Assuming around $300 total brings our balance to about $700/month.

Discretionary Expenses 

You did it! Now we’re at the fun part — discretionary expenses on clothes, entertainment, subscriptions, and more. According to the 50/30/20 rule, we should have about 30% of our income per month put aside for these pleasures ($750 is closer to 20%, but Food & Dining might include the remaining portion).

Don’t feel guilty about spending this money — you earned it! It’s time to play some mini-golf and watch the 43rd Marvel movie.

Tips to Make Your Budget Go Further

We’ve got a pretty good budget going so far, but one of the keys to financial freedom is lowering your spending. Here’s how you can do that:

  • Commute via rideshare or public transport when possible. 
  • Plan meals and groceries in advance, so you don’t make impulse purchases at the grocery store.
  • Buy used over new — that goes for cars, clothes, and coffee grinds. (Okay, just kidding about that last one).

Remember that these rules aren’t hard, fast, or furious. Just keep your expenses low and change things up as you see fit. Financial freedom, here we come!

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Frequently Asked Questions

What can you afford with a $50k salary?

With a $50,000 salary, you have enough money to afford a $1,000-rent apartment, about $800 a month on necessities like food and transportation, and finally around $700 in disposable income — all on a month-to-month basis. The rest will go towards savings, utilities, insurance, and more.

How much should you save on a $50k salary?

A good saving rule is 20% of your take-home income. Assuming you pay $10,000 in taxes, 20% comes out to $666 per month. This may or may not include loan payments and investments.

Is $50,000 a year a good salary?

With the proper budget and discipline, $50,000 is an excellent salary. In 2020, the median household income in the United States was about $67,000. Your debt load, dependents, and assets will determine how comfortably you can live with an income of $50k.

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