California has a reputation that precedes it as one of the most expensive states in the US. This means anyone planning to move here needs to know what qualifies as a good salary in the state. So, is 70k a good salary in California?
70k is a good salary in California. But that depends on factors such as whether it’s gross or net salary, the family size and the number of working adults in a household, the location of the person within the state, and the person’s profession. Usually, a 70k salary is good for a single person.
However, not many people earn up to 70k in California. While the data on average salary varies, the median household income in the state is $78,672, which means not many people earn up to 70k after taxes. Here, we discuss whether 70k is a good salary in California and the state’s living wage.
How to Determine if 70k is a Good Salary in California?
Here are the factors you should consider if you get an offer promising a 70k salary:
1. Gross or Net Salary
If 70k is your salary before tax in California, the chances of it being enough is very slim. The state has the highest income tax rates in the country. Anyone earning 70k will have to pay over $17,000 in taxes and other compulsory rates. This means the net pay will be $52,335. This is insufficient, especially if you’re the family’s breadwinner.
2. Family size and work conditions
One of California’s best ways to save money is to be single. If you’re yet to have a family, $70k can be a great salary in California, especially if it’s after-tax. Even if it’s before tax, most people will live comfortably on an income of over $50k as a single person. The living wage for a single person here is $21.82 per hour. If you calculate that based on the yearly wage, it’ll amount to $41,894.40. That still leaves room for a single person in California to save and do a few other things.
But a household will have trouble living on a $70k pre-tax salary, especially if that’s the total household income. The bigger the size of the family, the higher the average living wage would be. A couple has a living wage of $33.58 if only one is working. This means the household needs $69,846.40 as a living wage. So, a net salary of 70k might still be enough.
But once they have a kid, the annual living wage jumps to $84,822.40. Thus, the best thing for couples with kids is for both adults to work. This way, if both of them earn a salary of $70k each, it’ll be sufficient as a household income.
California is notorious for being expensive. But that doesn’t mean every part of the state will drain your money. The housing market is mostly responsible for the high cost of living in the state. But there are still several with affordable houses. If you’re living in one of those affordable cities, you might not have a problem with a 70k salary. But if you live in one of the major cities or expensive areas where homes are in seven figures, 70k won’t be a good salary.
Although the average salary in California isn’t too far from 70k, the chance of earning 70k is still low. The poverty rate in the state is 12.6% which is quite high. The chances of getting a 70k salary job are lower when you are not living or working in the major cities. So, it’s usually a challenge for most people.
The profession also matters greatly in determining if 70k is a good salary. Like all places, certain jobs are in demand in California and normally pay more. For example, the average annual salary in California is over 100k for those in management, business and finance, technology and engineering, legal, architecture, and healthcare. Even for entry-level jobs in these highly technical fields, the salary usually exceeds 70k. So, it’s important to consider the industry standards and compare salaries in similar roles before taking a job promising 70k.
However, the lowest-paying fields include transportation, production, sales, food service, and maintenance. In those low-paying fields, a 70k salary might be excellent. But it’ll depend on other circumstances too.
What Is a Good Salary in California?
The cost of living in California is quite high, meaning anyone who wants to live here too has to earn well. Although determining what amounts to a good salary will depend on the individual circumstances of each person or household, anyone earning around 70k should certainly be comfortable in the state if they’re living alone.
The MIT Living Wage calculation estimates a person who’s working full time at 2080 hours per year will need to earn a certain amount to live comfortably. The living wage per hour ranges from $21.82 for a single person to $73.98 for a family of 4 where there’s only one adult. Unfortunately, all the living wages are above the minimum wage in the state, which doesn’t even consider the number of dependents a person has.
Typical Salary in California
If you’re planning to move to California, you’ll want to know the typical salary here to know what to expect. There are several figures. Salary Explorer says the average salary here is $112,000, while the median is $118,000. However, salaries range from as low as $28,200 to as high as $498,000 in terms of average.
Typical Household Income in California
The median household income in the state is $78,672 in 2020, according to the US Census Bureau, while the per capita income was $38,576. However, a lot depends on the location. Counties include Alameda, Alpine, Los Angeles, Marin, and Orange. Napa, San Francisco, etc., have a median household income well above $100,000. San Mateo had the highest at $182,158.
70k is a good salary in California if you’re a single person living alone. But if you’re not, it might not be, especially if it’s the overall household income. The median household income in the state is above $70,000, and the cost of living has risen due to inflation.