Remember when the idea of a six-figure salary was a dream that was somehow tied to the idea of success. Sadly, that idea still persists even though $100k salary still sounds like the dream. One woman named Kait, who is earning nearly that, is pulling back the curtain on how much money she has left from her paycheck after deducting for basic necessities.
In a TikTok video, Kait broke down her paycheck from her $95,000 annual salary. Despite the fact that her salary is nothing to balk at, many people were surprised at the amount of money Kait had left over.
“My net paycheck was $2,553, which can seem kind of low for my $95,000 annual salary, so here’s the breakdown of gross to net so you can see where all the funds are going and why my net paycheck is only $2,553,” Kait began in her video.
She explained that her gross pay is $3,979, and 10% of her paycheck is contributed to her 401 (k), which ends up being $399.91. She then invests $75 into her health savings account, alongside all her insurance payments, which include medical, dental, vision, and accident insurance, totaling $68.88. The largest payment taken out of her paycheck is taxes, which is $882.30.
After those expenses, Kait’s paycheck was $2,553. She explained in the comments that she’s paid semi-monthly instead of bi-weekly, which is why her take-home might look different from someone who might be earning the same but is being paid bi-weekly. While Kait isn’t necessarily living paycheck to paycheck, it does highlight the fact that, despite having a well-paying job, it does take a lot of focus and dedication to make sure you’re saving money.
The problem is, many Americans can’t even afford to put aside money into savings accounts or even put that much money into their 401 (k) because the cost of living is just so high.
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According to a Bank of America analysis, authors defined people who live paycheck to paycheck as those who dedicate more than 95% of their household income to necessities, which include gas, food, utilities, internet, public transportation, child care, and housing costs. Across all income levels, households that earn less than $50,000 a year saw the highest number, around 35%, of people living paycheck to paycheck.
A survey by Redfin found that 22% of working Americans spend all of their earnings on rent. Proving that saving is nearly impossible due to high housing costs and stagnant earnings.
Similarly, a survey from MarketWatch found that, across most generations, it’s usually young people who are more likely to report living paycheck to paycheck. Seventy-two percent of Gen Zers, 65% of millennials, and 57% of Generation Xers reported living paycheck to paycheck. Baby boomers (44%) and the Silent Generation (20%) were less likely to say they do.
Even if people are doing everything right, including budgeting, cutting back on certain expenses, and even attempting to save, the cost of living has become exponentially harder to maintain. It’s why so many people in this country have to get more than one job or even multiple side hustles just to put food on the table and have a roof over their heads. It’s just one of the many problems that point to the larger issue of wages not particularly matching the economy we’re living in.
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Nia Tipton is a staff writer with a bachelor’s degree in creative writing and journalism who covers news and lifestyle topics that focus on psychology, relationships, and the human experience.
