Maybe. Depends on where you live. If you live somewhere relatively inexpensive it’s not bad. However, I’d have to caution that this sounds like gross income (I did a search and the article didn’t say), and if it is, this isn’t great. Taxes, medical, any union dues, and hopefully a significant chunk going into a retirement fund will eat this up quickly. This is in the 24% fed tax bracket - not including child credit or any pre-tax deductions for something like a 401k, and no State tax taken. 140k take-home would be pretty good.
I highly recommend that you read the actual substack article.
The claim is based around how the original poverty line was the cost of food multiplied by 3. This assumes that food is 33% of your spending and that your other expenses are approximately the other 67%.
The $140k value is based around the fact that the ratio has shifted immensely. Food is cheap in the US relative to the other goods/services required to live in society. If you take the new ratio and extrapolate it out, the multiplier is over 10x the cost of food to account for the other components of spending.
Even if you want to debate the actual number itself. The poverty line is laughable and anyone living at it is legitimately destitute, not just in “casual poverty”
The issue is… how do you accurately determine the poverty line without just taking some number and multiplying it. Because not only do costs vary by location, so does their ratio. So you really need a set of costs per location added together, then averaged based on the density of population in the area the costs were pulled from. And of course at that point the finaly number is probably true nowhere. So what is the use of it anyway. Each specific area needs it’s own poverty line. The smaller the area the more useful and accurate the number will be. But you can’t just say “fine, we will do it by zipcode”. Because zipcodes have significant variation of sizes. It needs to be done intelligently and constantly as things shift. So in the end, there simply is no reasonably accurate poverty line unless a human calculates it for a specific address.
Take how much it takes for a living wage in the most expensive part of the country.
And that’s it. If you try to shrink wrap it down to where it’s bare subsistence anywhere, you trap people in places where everyone with the means leaves. Sure, the cost of living is low, but there’s no jobs because everyone with money left. So it becomes impossible to get by, let alone amass the funds needed to relocate.
I guess it depends what you plan to use the number for. If you plan to set the min wage on it, you will destroy small businesses in poorer areas, and probably cause the chains to leave those same areas.
The poverty line is about 32K for a family of four, and 15K for a single person.
fed minimum wage full time is a income of 15K per year. this of course, varies by state, w/ CA min wage becoming 36K a year.
Which is nuts, because a two bedroom (hope your kids are the same gender) place is gonna be 24k of that. So 8k left over for insurance (car, life, home, and medical) food, childcare, all other bills, taxes, Christmas, school supplies, children’s clothes and shoes. It’s way below the number that would cover half of that.
I truly feel for the people that are in that boat…
If $140,000 is the poverty line can I please make poverty wages?
This calculation is for a family of four. Please read more than the headline and comments.
The substack is well worth the read.
Math that a lot of us educated poverty-livers have done before. Its refreshing to see one of the econ-bros validate it.
God I wish that were me
“laughable,” arguing that you can’t declare the majority of Americans impoverished because the suburbs they choose to live in are expensive, which is what Green did when he used the middle class suburb of Caldwell, New Jersey, as his median.
“My plastic surgeon said smiling is a waste of Botox, but I can’t help but let out a boisterous ha cha fucking cha at the absurdity. If poor people don’t want to spend so much money on cost of living they should just go live in the places nobody lives because there are no jobs or resources.”
“Poor people are just so bad at managing money. That’s why they have to blindly trust everything we say. We know how to spend money wisely, and we know what’s best for the economy and them.”
“Get out of the way Plebs! We’re betting it all on AI!”
“Oh my! Well, that was unfortunate but also completely unforeseeable. I guess the only thing left to do is brush ourselves off, pat ourselves on the back for being such altruistic utilitarians, ignore the screams from the plebs and go again.”
“So where’s our bailout? Time is money.”
Rent is like 50% of my income currently and I’m trapped because nowhere charges less for the same space and I don’t qualify for rentals without a guarantor that I no longer have. At this age, my parents were in their 3rd house on a single income with 3 kids.
The wealthy really fucked us over, hey. They’re scum for what they did.
They’re scum for what they are currently still doing, and must be stopped.
1000%. Preach it!
Don’t insult people over their nature. Money corrupts, especially over many generations. They just play a rigged game and have the edge to win. Time for some regulations. Social capitalism is the answer, fair taxes even on rich people. Prevent wealth hoarding over a certain point. Stop insulting people and get to three voting booth. Start telling real people to change their vote.
Spare us the civility horseshit. Their nature? The level of organized greed and cruelty that is being inflicted on the world is NOT natural. It is abnormal and it is evil. The “edge to win” means they had a rich white mommy and daddy who also had a rich white mommy and daddy.
And “some regulations” and “fair tax” aren’t going to fix shit. Social capitalism? What the holy fuck is that? The winning entry in an oxymoron contest? Fuck off liberal.
Same and I live in what would be considered a rural state. We don’t have any big cities and a studio apartment would cost me about $1500 a month about 50 miles outside our biggest city and $1800+ within 50 miles of Portland Maine which is our biggest city. This shit is out of control. Our wages are more in line with a rural state, but our rent prices are near what you’d expect in a bigger city.
that’s because your real estate is bought up by people like me with 150K salaries who think your 1800 rent is dirt cheap. In Boston a studio is over 3K now.
i know people who moved to Maine to find cheaper housing because none is available in Boston area. and the people who live in Boston fight any/all development to expand the housing supply, including renters. like i have friends who rent, who pay 3K a month, and then go to town meetings to fight new housing developments, and then complain went there rent goes up another 10%
Exactly, while I make a fraction of what you make and I could never afford to buy a house anywhere. Back when I first started renting 16 years ago, my friend and I rented a 2 bedroom place for $450 a month and now a studio is 4 times that in rural states.
The owner of the place I currently rent has surprised us with a Christmas notice that she’s selling the place and we have leave by April. We can’t afford anywhere near hear so we’ll have to move very far north and our commutes will at least double. Maybe triple. Locals are getting forced out of places they’ve lived their whole lives. This shit is fucked up. People are too damn greedy and selfish.
This is highly dependant on where you live, as has been said before.
“a family of four needs $136,500 a year”
I could see that, more likely in more expensive areas. You aren’t getting anywhere in New York or San Francisco on $140K.
The poverty line is for the nation overall. Using some of the highest cost of living areas to set it doesn’t make sense. Why would you say a family making considerably more than most of their peers is poor because they would struggle to afford living somewhere else entirely?
It should be localized. it cuts both ways. Why would we say a family struggling to make ends meet is not really poor because they could live comfortably on that salary in a different region?
in New York or San Francisco on $140K.
A month?
plenty of people live in these cities on less than 140K and are doing fine.
I live in Boston and I do great and a few years ago I was only making 70K.
I’m not sure what are the living standards in Boston or even if those exist, but good for you.
Boston scares and mystifies me and I know nothing of your bizarre customs.
it’s a city with a lot of money. but nobody shows it off the way they do in nyc/la. it’s very ‘modest’.
people with 50million in the bank drive a 30K prius and wear eddie bauer and agonizing over their property tax going up $500 as if it will bankrupt them.
I mean, we’re poor but we make less than half that just outside San Francisco. Honestly we’re doing okay. We don’t get any of the luxuries my parents had at our age, but we have smartphones so we can never get away from anything!
How much is your rent, if it’s not too much to ask?
we live with family, maintain the property and shit. that’s our rent. given our locale it comes out to about 15k/yr net we’re saving.
probably should have put that in your original comment tbh. You implied one can make it on ~$70k near SF as if your bills were 1:1
i’m disabled. my medical care costs more than rent would. should i have included that too?
Yes. That seems pretty relevant to your financial story.
Like always, how far your money goes depends on multiple factors. 140k in the Midwest alone means you’re living comfortably. Like all bills paid off, a lot of extra money for leisure, etc.
If you have a family and live in the bay area, then it’s not that much. I personally wouldn’t put it at poverty, but it’d be somewhat close to being paycheck to paycheck (assuming you still need to pay mortgage and whatnot)
No obviously not.
This calculation is for a family of four. Please read more than the headline and comments.
That doesn’t even buy a single politician.
I thought I heard Sam Bankman-Fried say he was surprised at how little it cost, it was like $50k or something.
State level politicians are like $5k-$10k. Shockingly cheap but you do need to buy most of the set.
I live alone in a moderately low cost of living area making about 52k take home. With no extenuating expenses related to health I can put away a hundred or two a month after rent, gas, utilities, food and car maintenance (I drive and fix old shit myself rather than make a car payment). But that is literally all I can do. If I had a second person to support or was in any other area I’d be underwater quick.
It’s mentioned in the substack article that for a single individual his calculations place the poverty line around 50k, while 140k is for a family.
yeah but is your income going to go up? or are you like 50 and it’s maxxed out?
context is everything. if you’re 25 and your salary will double in 5-10 years your situation isn’t bad.
blows my mind in my city how many 22-25 year olds scream how poor they are when they are just starting out their lives and think their 50-60K wage is ‘poverty’ when it will be 100K in 5 years.
I get what you’re saying but some people 22-25 are still hoping to start a family or buy a house.
who? the ultra religious/conservative types?
22-25 is way too young to be doing either of those things.
Well shit thats a little Less than 3x what I make lol. 💀💀💀💀
Yes. The people saying no are no longer temporarily embarrassed millionaires but temporarily embarrassed middle class. Have or have not, and 140k is have not given inflation, healthcare, education, food, rent/mortgage, energy etc.
140K is more 85% of the USA population.
It’s upper middle class. it’s about 5 grand a month in disposable income. assuming a 1/3 tax rate and 3K in rent/mortage
it’s also what I make, and yeah i have that much disposable income per month.
