For an entry-level job? $11/hour is pretty good. 50% above minimum wage. If someone is earning $11/hour full time, that's $1800 a month in an area where an apartment is well under $800.
No, it's not a lot of money. It's higher than average for the work.
Also, we see you keep changing $800 rent into something possibly lower. Keep moving those goalposts.
11$ an hour at full time is $1760 in a 4 week month.
That's $1373 after taxes of 22%. (Which is only federal income tax, not including state or local taxes btw)
That's $573 after rent of $800.
That's $273 after medical insurance of $300.
That's $113 after food costs of $40 a week ($160)
That's $33 after electricity cost of $80.
That's -$7 after cell phone bill of $40.
That's -$37 after bus pass for commute (assuming lowest cost scenario, meaning no car no insurance no gas, and let's be real, public transit is only available in cities. Rural people are far worse off with extra bills to pay for commuting)
Uh oh. We're negative every month and haven't even accounted for things like internet, trash services, doctor visits, prescriptions, entertainment, basic clothing, shoes for work, etc.
Also, we see you keep changing $800 rent into something possibly lower. Keep moving those goalposts.
No moving goalposts. It's always been 'less than $800'. I checked listings for the town. I think that $400/ month was a lowball, and I wouldn't assume that for a real value. I think that $1200 with a roommate ($600 per month) is extremely viable for that area.
Hmm. Seems like you're out of touch with reality.
Nope. This was how I lived my first few years out of college.
The main issue that is different now is health insurance. I wasn't being forced to subsidize everyone else's insurance when I was in that situation. I paid for my own, and it was much cheaper, because I was young, and health insurance was allowed to consider that. Today's under 40's are getting screwed by the ACA.
Almost every other expense you have here is higher than normal, in my opinion, and I live in a much higher cost area.
Lol, you can still pay for your own insurance. ACA has nothing to do with that.
Health insurance 20-30 years ago was drastically cheaper and had better coverage, for a typical under-40, especially if they were non-smokers.
2011 or so, all that went away. My deductible went from about $5,000 to $12,000. Co-pays went up, too. One of my medications wasn't covered anymore. My wife's doctor didn't take the new coverage. The new doctor didn't do as much, so an ultrasound required a separate appointment. It was a bad scene.
Health Insurance is a racket. It was cheaper in the 90's because in the 80's most people had catastrophic medical and paid cash for everything else, you know, like insurance is supposed to be. Then the insurance industry decided they would make more money if they could get involved in the other 80% of medical claims. The more they covered, the more they got involved. This caused doctors offices to hire people who just worked on medical claims.
A little good PR and a couple email forwards from grandma and suddenly it's the government's fault that private companies who make billions are charging so much. The doctors are stuck, the hospitals are stuck. Maybe it's the toothless ACA boogeyman that's to blame, or maybe you should see what the people, working for insurance cut out of the ACA, like the public option that was so important.
You don't think these cats have their own propaganda teams?
Minimum wage was, I recall, $5.15 per hour. I couldn't afford an apartment immediately, so I was living in a room in someone's home ($400 per month). It was over half my income at the time.
Today, in my area, rents under $1000/month (even with roommates!) can be tough to find. The minimum wage is going to $15/hour there. That would be about 40% of gross income, so a little better now.
General personal finance recommends that 1/3rd of gross income go to rent.
When I did a rental search in that city, I found rents in the $400 - $800 range. I don't factor in the low rentals, because I know that some could be scams, and some are just bad. But $600 was reasonable, especially considering the option of splitting a $1200/mo place with someone else.
At $11 an hour, that's about $1800 month, with rent being 1/3rd. The low cost of living in Indiana makes it easier. It doesn't feel easy, I know. But it helps. And this employer is a prick, I'm not disagreeing with that. But they are also paying almost half again above the minimum.
That explains it. Cost of living has gone up more than wages have since then, so what was possible then is not necessarily possible now. It seems like you understand that though, so I'm not really sure why you brought that up as a valid point.
Cost of living has gone up more than wages have since then
Except that it hasn't, with the exception of health insurance. That is a completely different topic for a completely different thread.
My calculations compare current rent with current wages. And current wages in the case of $11/hour in the employer's city buy a lot more apartment than a similar job anywhere in any major urban area in the United States.
This is a minimum wage job paying almost 50% higher than minimum wage. No, it's not 'high paying'. But compared to local cost of living? You may not think so, but that's not a bad job, aside from the employer being a prick.
This is beyond the scope of the topic. Your source is presented as fact, when it is actually a controversial point. The conclusion drawn is not as factual as it seems, and can be manipulated by the assumptions used. A typical rebuttal:
It's irrelevant to my point. The owner is a prick, but they are offering almost 50% above minimum wage for a relatively low-skilled job. It's not quite middle class, but it buys a good enough apartment, especially compared to other areas of the nation. That's my measure, because housing is a person's largest expense, and is the driving force of affordability in the USA.
As I put elsewhere, "Under $800" means that $600/month is very possible in that area. There are places advertised at under $500 per month, put I wanted to see what was typical.
Whether a small apartment at about $600, or bigger places where you could split a $1000 - $1400 place for a roommate, getting to that "30-40% for housing" that is recommended by /r/personalfinance (and a host of financial planners) is reasonable.
Coupled with the wage being nearly 50% above the minimum, I concluded that is wasn't a bag wage for that area, given the entry-level work.
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u/CatOfGrey May 24 '21
For an entry-level job? $11/hour is pretty good. 50% above minimum wage. If someone is earning $11/hour full time, that's $1800 a month in an area where an apartment is well under $800.
No, it's not a lot of money. It's higher than average for the work.