When moving to a new place, there are a lot of things that have to be in place. This might include getting a new job and knowing the cost of living in the state. So, you may wonder, how much money do you need to live comfortably in Indiana?
The living wage for an individual in Indiana is $32,844, while a family of 4 needs $87,486. If a household wants to live comfortably, they’ll have to earn around 20% above the living wage so they can afford savings. But that might not be necessary given the low cost of living in the Hoosier state.
However, the state has a very low minimum wage of $7.25, which is the same as the federal minimum wage. Fortunately, some cities, such as Bloomington, have ordinances that increase the minimum wage within their jurisdiction. Here, we discuss how much money you need to live comfortably in Indiana.
Living Wage in Indiana
Before moving to Indiana, you must determine that you’re making enough to live in the state. The best way to do this is by examining the cost of living and comparing it with your income. This is what a living wage is all about.
The living wage in Indiana refers to how much you need to meet all your basic needs and enjoy an average standard of living in the city. According to the MIT Living Wage Calculation, a single person in the state will require an income of $32,844 before taxes. This breakdown means the person must be making $15.79 per hour and work for 2080 hours annually. A household of 4 requires a gross income of $72,238 if only one of the adults is working and $87,486 if both adults are working.
After taxes, the same group of households will need $27,201, $59,828, and $72,456, respectively. But, of course, the living wage doesn’t include savings which should account for about 20% of your income. So, the living wage is just the number you need to buy in the state. But if you want to live comfortably, you’ll need to earn more.
A study by GOBankingRates calculated that what amounts to a comfortable living will make twice as much as the cost of living in the state. However, only a few people make this much in Indiana.
Minimum Wage in Indiana
The minimum wage in Indiana is one of the lowest in the country. Its minimum wage is $7.25, the same as the federal minimum wage. This amounts to an annual income of $15,080.00 which is less than half of the gross minimum wage in the state. The last time there was a change in the minimum wage was in 2008 when the state increased it from $6.55.
The minimum wage applies to all employers that have two or more employees. However, some employers are exempt from paying minimum wage. Also, the state has a special training minimum wage set at $4.25 for employees below 20 years in their first 90 days of employment. Workers are entitled to get at least 1.5 times their minimum wage if they should work overtime. Over time, in this case, means anything work exceeding the 40 hours work week.
The student minimum wage here is $6.16, which is 85% of the minimum wage. This may apply to full-time students in colleges and high school who decide to work part-time for a maximum of 20 hours a week. Tipped employees May also be paid lower than the minimum wage. But the tips must be enough to increase their overall earnings to the minimum wage.
However, different cities within the state may have minimum wage regulations. For example, Bloomington requires that the employer should pay a living wage to the employee in accordance with the Living Wage Ordinance. In 2021, this was $13.29, of which $1.99 could be in the form of health insurance covering the employee. In 2022, it increased to $14.01, of which $2.01 could be health insurance.
Most households here make more than the state minimum wage. Indiana’s median household income in 2020 was $58,235, and the per capita income was $30,693. The state has a poverty rate of 11.6%.
Highest Paying Jobs in Indiana
If you want to move to Indiana, you’re likely targeting a job that will pay you enough to live comfortably in the state. In that case, it helps to know the best-paying jobs in the state. They’re usually technical jobs or those that require academic training and certifications.
Fields such as Medicine and Dentistry, Legal, Pharmacy, Engineering and Architecture, Finance and Management, Computer and information technology, and Education are usually high paying. But what will determine this, in the end, are the location within the state, your experience and qualification, and your negotiation skills.
You must familiarize yourself with the industry so you’ll know the average pay before you start negotiating. This can save you the disappointment of negotiating a lower salary than you’re worth.
Cost Of Living in Indiana
Indiana is an affordable state. Its cost of living index is 17.9% below the national average. This is mostly due to the low cost of housing, among other things. Generally, the state’s groceries, healthcare, utilities, and transportation bills cost less than the national average. But the fact, it’s the housing cost that makes the most difference.
Housing is usually what most households spend the highest part of their income on. But in Indiana, buying a home or renting one is still affordable. Home prices here are increasing at a slower pace than the national average. The typical home value here is $218,636, which is lower than the national average by more than $100k. This is slightly understandable given the low wages in the state. But it still shows just how affordable the state is as a whole.
Childcare is one of the biggest expenses for anyone who wants to live in Indiana. The average annual cost of childcare here is $6,314. While that’s high, it’s not the highest in the country. Several states cost more to raise a child.
Indiana is an affordable state, and this is one of its biggest draws. So, it makes a living on wages below $30k as a single person here makes it possible. But if you’re planning to live a reasonably comfortable life, an annual income almost double the living wage will assure that.