Moving an existing debt to a credit card usually incurs a charge called a balance transfer fee. Paying it might feel like a penalty, but it could be your ticket to a faster and cheaper debt payoff.
Here’s what you need to know.
What is a balance transfer fee?
A balance transfer fee is the cost you pay to transfer a debt to a credit card. The credit card issuer assesses this fee in exchange for taking on your debt.
A balance transfer fee typically costs between 3%–5% of the transfer amount. Balance transferring a debt of $5,000 at a 5% rate would cost $250. The balance transfer fee is added to the overall balance on the card receiving the transfer. So, using the prior example, you’d owe $5,250 after the transfer was completed.
Balance transfer fees tend to increase with the age of the account, incentivizing you to make a transfer within the first few months of opening the credit card.
🤓Nerdy Tip
The best balance transfer credit cards often require at least good credit to qualify, meaning a FICO score of 670 and above. If good balance transfer cards aren’t available to you, there are still ways to make debt payoff more manageable. Read our tips.
Do all credit cards charge a balance transfer fee?
No, but those cards that waive balance transfer fees are rare. You’ll have better luck finding a no-balance-transfer-fee credit card through a credit union rather than a major card issuer like American Express or Barclays. However, to be eligible for a credit card from a credit union, you need to be a member of that credit union. Membership may be contingent upon employment status or proximity to one of the credit union’s branches, so not everyone will have access to the credit union and its financial products.
Some Capital One cards don’t charge a balance transfer fee — but only if you transfer a balance at the current transfer annual percentage rate, or APR. If you take advantage of a promotional balance transfer APR — say, 0% APR on balance transfers for 15 months — Capital One would charge a balance transfer fee. Most people will benefit far more from a lengthy interest-free period rather than a waived one-time fee.
🤓Nerdy Tip
Each major credit card issuer has its own rules about the types of debts that may be transferred to a credit card. For example, Chase only allows balance transfers of credit card debt whereas Barclays accepts transfers of any loan, including personal loans and student loans. Read about each issuer’s policies.
When is a balance transfer fee worth it?
Moving a debt to a credit card to obtain a lower interest rate can save hundreds or thousands of dollars in interest. So, you’ll likely make up the cost of the balance transfer fee, and then some, through the transfer.
Consider the previous example of transferring $5,000 at a 5% rate for a $250 fee. Let’s say you moved the $5,000 to a card with a 0% APR on balance transfers for 18 months, and you pay the entire debt off before the promotional 0% period ends. Total debt paid off: $5,250.
That same $5,000 debt on a card with a 20% APR would rack up $82.85 in interest in just one month. (This number assumes that no payments and no additional purchases are made on that credit card.) As long as any part of that $5,000 isn’t paid off, the issuer will continue to charge interest on the remaining balance.
Use our calculator to determine how much interest your debts are costing you to decide if a balance transfer to a credit card can save you money.
Life insurance is one of the most important investments that you can ever make for your loved ones. If something tragic were to happen to you, and you didn’t have life insurance coverage, then your family would be responsible for a mountain of debt and other expenses.
It’s important that you find the best plan for you. That means that you’re going to need to compare the different types of plans and you will need to find the best insurance company for you. Every insurance company is different, all of them have different products and will give you different rates based on their medical underwriting and rating system.
When you are considering the purchase of a life insurance policy, it is vital to ensure that you have the right type and amount of protection for your specific needs. You should also ideally research the life insurance company you are considering buying the policy through. Here, the company should be reliable and stable financially, and it should also have a good name for paying out its policy holder claims. One insurer that meets these parameters is EquiTrust Life Insurance Company.
The History of EquiTrust Life Insurance Company
EquiTrust Life Insurance Company is one of the smaller life insurance and annuity providers in the overall insurance market place. While EquiTrust is not typically thoughts of as being a household name, the company is known for offering an excellent selection of quality financial vehicles that can help consumers with growing and protecting their wealth. These consist primarily of single premium life insurance policies and indexed retirement annuities.
Through its products, the company focuses on offering new financial ideas that can substantially help its customers to meet their specific needs. It also prides itself on its stellar customer service. EquiTrust has a broad range of niche products, so the company’s policy holders can be more assured that they will be able to change, add, and alter their products or product mix, as their personal and family financial needs change over time.
In many ways, EquiTrust can be considered as more of a niche insurance company, as they tend to specialize in indexed products – namely indexed life insurance and indexed annuities. Because of this, consumers who are in the market for this type of financial product will find a lot to choose from in EquiTrust Insurance Company’s product mix. This applies particularly to those who are seeking the opportunity to grow funds on a tax deferred basis, while at the same time keeping their principal safe.
EquiTrust Life Insurance Company Review
Many of the insurance products that are offered by EquiTrust Life Insurance Company include underlying equity and index related financial vehicles – which can help policy holders with increasing their opportunity for a higher return.
The company works in conjunction with Guggenheim Partners – a global investment and advisory company – which provides portfolio management for many of EquiTrust Life Insurance Company’s products.
Equitrust has more than $14 billion in invested assets – of which a majority are considered to be investment grade. However, a certain percentage of these assets are not deemed to be investment grade (in the investment class of A or better), which in turn, can make the insurer ratings agencies a bit more leery about the company’s overall financial strength in the event of a downward moving market. Equitrust Life Insurance Company is headquartered in West Des Moines, Iowa.
Insurer Ratings and Better Business Bureau Grade
EquiTrust Life Insurance Company is considered to be stable financially, and because of that, the company has earned the following ratings from the insurer rating agencies:
B++ from A.M. Best Company
BBB+ from Standard and Poor’s
The company also has earned a Comdex rating of 43.
Also, even though EquiTrust Life Insurance Company is not currently an accredited business of the Better Business Bureau (BBB), the BBB has given the company a grade of A+, based on a range of A+-F.
In the last three years, EquiTrust Life Insurance Company has settled four customer complaints (of which one complaint has been closed within the past 12 months). Of the four total customer complaints, three were regarding complications with the company’s product and service, and the other was regarding advertising and sales issues.
Life Insurance Coverage Offered by EquiTrust Life Insurance Company
EquiTrust offers many options for life insurance coverage. Because of this, policy holders can choose the option that best fits their needs – and, they may also be able to change or alter their coverage as their needs evolve.
All the life insurance plans that are offered through EquiTrust are permanent, meaning there is death benefit protection and a cash value/savings component. The funds that are inside of the policy’s cash value can grow and compound over time on a tax deferred basis. There is no tax due on the increase of these funds until the money is withdrawn by the policy holder.
Even if an individual has certain medical conditions, it can still be possible to qualify for a life insurance policy through EquiTrust. This is because there are no medical tests or exams required to obtain coverage.
The life insurance policies that are offered by EquiTrust include the following:
Wealth Max Bonus Life
With the Wealth Max Bonus Life plan, the policy holder will be able to get stock market and multi-asset index-linked earnings in the cash value. This policy is a single premium index life insurance plan, so there is just one single lump sum premium required, and then the policy will be considered paid up. Also, there is a 12 percent bonus that is added to all premiums.
Wealth Horizon Life
The Wealth Horizon Life plan is also a single premium life insurance policy that offers both stock market and multi-asset index-linked earnings. This plan has highly competitive rates so that the cash value could grow quite a bit over time. The policyholder can borrow against the cash value at any time to do any number of things: debt pay off, vacation, or even supplement retirement income.
Wealth Sure Life
The Wealth Sure life insurance policy also requires just one single premium to purchase the plan. Here, the policy holder will get a declared rate of return that is set by EquiTrust.
Wealth Pay Life
The Wealth Pay life insurance option from EquiTrust is a fixed premium life insurance policy, meaning that the premiums will be due annually or monthly by the policy holder. The premiums could alternatively be paid via the money in a single premium annuity. In this plan, the return of the cash value is also linked to stock market performance and the performance of a multi-asset underling market index.
EquiTrust Burial Insurance
When the time comes to plan for the future, it is important to consider any and all of your current and future financial obligations. These can include any mortgage and other personal debts that you’ve incurred, as well as the ongoing living expenses of those in your life who count on your income for their everyday living expenses. One item that is sometimes overlooked, though, is that of funeral and other final costs. But doing so could end up putting your loved ones and survivors in an awkward financial position, as they may need to dip into savings or other assets to get the costs paid.
Today, the average cost of a funeral in the United States runs between $8,500 and $10,000.This is especially true when you consider the price of a memorial service, flowers, and related transportation, as well as other items like a burial plot and a headstone.
Many families just simply do not have this amount of money that is readily available, so they may end up having to take it out of savings – or worse yet, put these expenses on a credit card (in turn, leaving them in financial hardship for months, or even years, to come). In any case, having life insurance can mean the difference between your loved ones being able to move on, or having to drastically change their lives – during an already difficult time for them.
Other Products and Services Offered
EquiTrust Life Insurance Company also offers retirement annuities. These products can allow you to save money on a tax deferred basis, and then to obtain a guaranteed lifetime income stream in the future. This revenue can continue coming for the remainder of your life – regardless of how long that may be.
EquiTrust offers four types of annuities. These include the following:
Index – With an index annuity, the return on the funds is based on the performance of an underlying market index, such as the A&P 500. When the index performs well, an excellent return can be gained. If, however, the underlying index performs poorly for a given period, the account is solely credited with a 0%. This can allow for ongoing protection of principal, regardless of what occurs in the market. EquiTrust offers several different options regarding index annuities. These include the Market Twelve Bonus Index, the Market Power Bonus Index, the Market Booster Index, the Market Ten Bonus Index, the Market Value Index, the Builder Bonus Index, and the DynaMARC Index.
Multi-Year – The multi-year annuity – Certainty Select – allows you to lock in a competitive rate of interest for a duration of 3, 5, 6, 8, or 10 years.
Traditional Fixed Rate – With EquiTrust’s Choice Four options, you can choose from a variety of different durations, with annual reset interest.
Immediate – With an immediate annuity, the income payout can begin either now or later – and, it can be for a set number of years, or for the remainder of your life. EquiTrust’s immediate annuity product is the Confidence Income plan.
Although many of the products that are offered by EquiTrust Life Insurance Company may be suitable only to a small segment of the population, for those who do fit into this niche, the product offerings can be quite attractive.
How to Get the Best Premium Rate on Life Insurance Coverage from EquiTrust Life
If you have been seeking the best premium rates on life insurance coverage from EquiTrust Life Insurance Company – or for that matter, from any life insurance carrier – then it is recommended that you work with an independent life insurance agency that can offer you suggestions from multiple insurance companies. That way, you will be able to shop and compare the policies, coverage, and premium prices of many different options. Once you’ve looked at your options, you can choose the one that will work best for your needs, and for your budget.
When you are ready to move forward in this life insurance policy comparison, we can help. We are an independent life insurance broker, and we work with many of the leading insurance carriers in the industry today. We can support you with gathering all the appropriate details that you need to make a smart purchase – quickly and stress-free.
We can provide you with many different life insurance policy quotes, all from your computer. If you are prepared to make a purchase, then all you need to do is just simply here and fill out our short quote form.
We know that the process of shopping for life insurance coverage can be somewhat overwhelming. There are a lot of different variables that you need to think about – and you want to make sure that you are going in the right direction regarding coverage, benefits, and premium price.
But the good news is that all of this can be accomplished when you are working together with an experienced life insurance ally on your side. So, contact us today – we’re here to help.
This post may contain affiliate links, which helps us to continue providing relevant content and we receive a small commission at no cost to you. As an Amazon Associate, I earn from qualifying purchases. Please read the full disclosure here.
We are going to under the cover and discover $14 an hour is how much per year.
For most Americans, this is hovering near minimum wage.
Let’s get this straight… This is not a livable wage.
If you are in high school or college and have support from your parents, then this is great spending money for you.
However, if you are making it on your own, $14 per hour will not make ends meet each month.
For most people, being at minimum wage is common and the goal is to make your way up the payscale and quickly!
In this post, we’re going to detail exactly what $14 an hour is how much a year. Also, we will break it down to know how much is made per month, bi-weekly, per week, and daily.
That will help you immensely with how you spend your money. Because too many times the hard-earned cash is brought home, but there is no actual plan for how to spend that money.
When living close to minimum wage, you must know how to manage money wisely.
More than likely, you are living paycheck to paycheck and struggling to survive until the next paycheck. Take a deep breath and make this minimum wage just a season.
The ultimate goal is to make the most of your hourly wage with inspirations to make more money.
If that is something you want to do, then keep reading. You are in the right place.
$14 an Hour is How Much a Year?
When we ran all of our numbers to figure out how much is $14 per hour is an annual salary, we used the average working day of 40 hours a week.
40 hours x 52 weeks x $14 = $29,120
$29120 is the gross annual salary with a $14 per hour wage.
Breakdown of 14 Dollars an hour is how much a year
Typically, the average workweek is 40 hours and you can work 52 weeks a year. Take 40 hours times 52 weeks and that equals 2,080 working hours. Then, multiply the hourly salary of $14 times 2,080 working hours, and the result is $29,120.
That number is the gross income before taxes, insurance, 401K, or anything else is taken out. Net income is how much you deposit into your bank account.
Work Part Time?
But you may think, oh wait, I’m only working part time. So if you’re working part time, the assumption is working 20 hours a week at $14 an hour.
Only 20 hours per week. Then, take 20 hours times 52 weeks and that equals 1,040 working hours. Then, multiply the hourly salary of $14 times 1,040 working hours, and the result is $14,560.
How Much is $14 Per Month?
On average, the monthly amount would average $2,426.
Annual Amount of $20120 ÷ 12 months = $2426 per month
Since some months have more days and fewer days like February, you can expect months with more days to have a bigger paycheck. Also, this can be heavily influenced by how often you are paid and on which days you get paid.
Work Part Time?
Only 20 hours per week. Then, the monthly amount would average $1213.
How Much is $14 per Hour Per Week
This is a great number to know! How much do I make each week? When I roll out of bed and do my job, what can I expect to make at the end of the week?
Once again, the assumption is 40 hours worked.
40 hours x $14 = $560 per week.
Work Part Time?
Only 20 hours per week. Then, the weekly amount would be $280.
How Much is $14 per Hour Bi-Weekly
For this calculation, take the average weekly pay of $560 and double it.
$560 per week x 2 = $1120
Also, the other way to calculate this is:
40 hours x 2 weeks x $14 an hour = $1120
Work Part Time?
Only 20 hours per week. Then, the bi-weekly amount would be $560.
How Much is $14 Per Hour Per Day
This depends on how many hours you work in a day. For this example, we are going to use an eight-hour workday.
8 hours x $14 per hour = $112 per day.
If you work 10 hours a day for four days, then you would make $140 per day. (10 hours x $14 per hour)
Work Part Time?
Only 4 hours per day. Then, the daily amount would be $56.
$14 Per Hour is…
$14 per Hour – Full Time
Total Income
Yearly Salary (52 weeks)
$29,120
Yearly Wage (50 weeks)
$28,000
Monthly Wage (173 hours)
$2.426
Weekly Wage (40 Hours)
$560
Bi-Weekly Wage (80 Hours)
$1120
Daily Wage (8 Hours)
$112
Net Estimated Monthly Income
$1,853
**These are assumptions based on simple scenarios.
Paid Time Off Earning 14 Dollars an Hour
Does your employer offer paid time off?
As an hourly, close to minimum wage employee, more than likely you will not get paid time off.
So, here are the scenarios for both cases.
For general purposes, we are going to assume you work 40 hours per week over the course of the year.
Case # 1 – With Paid Time Off
Most hourly employees, get two weeks of paid time off which is equivalent to 2 weeks of paid time off.
In this case, you would make $29120 per year.
This is the same as the example above for an annual salary making $14 per hour.
Case #2 – No Paid Time Off
Unfortunately, not all employers offer paid time off to their hourly employees. While that is unfortunate, it is best to plan for less income.
Life happens. There will be times you need to take time off for numerous reasons – sick time, handling an emergency, or even vacation.
So, let’s assume you take 2 weeks off without paid time off.
That means you would only work 50 weeks of the year instead of all 52 weeks. Take 40 hours times 50 weeks and that equals 2,000 working hours. Then, multiply the hourly salary of $14 times 2,000 working hours, and the result is $28,000.
40 hours x 50 weeks x $14 = $28000
You would average $112 per working day and nothing when you don’t work.
$14 an Hour is How Much a year After Taxes
Let’s be honest… Taxes can take up a big chunk of your paycheck. Thus, you need to know how taxes can affect your hourly wage.
This is why you always wondering why your take-home pay is so much less.
Also, every single person’s tax situation is different.
On the basic level, let’s assume a 12% federal tax rate and a 4% state rate. Plus a percentage is taken out for Social Security and Medicare (FICA) of 7.65%.
Gross Annual Salary: $29,120
Federal Taxes of 12%: $3,494
State Taxes of 4%: $1,165
Social Security and Medicare of 7.65%: $2,228
$14 an Hour per Year after Taxes: $22,233
This would be your net annual salary after taxes.
To turn that back into an hourly wage, the assumption is working 2,080 hours.
$22233 ÷ 2080 hours = $10.69 per hour
After estimated taxes and FICA, you are netting $10.69 an hour. That is $3.31 an hour less than what you planned.
This is a very highlighted example and can vary greatly depending on your personal situation. Therefore, here is a great tool to help you figure out how much your net paycheck would be.
$14 an Hour Budget – Example
You are probably wondering can I live on my own making 14 dollars an hour? How much rent can you afford at 14 an hour?
Using our Cents Plan Formula, this is the best case scenario on how to budget your $14 per hour paycheck.
When using these percentages, it is best to use net income because taxes must be paid.
In this example, above we calculated that $14 an hour was $10.69 after taxes. That would average $1853 per month.
According to the Cents Plan Formula, here is the high level view of a $14 per hour budget:
Basic Expenses of 50% = $926
Save Money of 20% = $371
Give Money of 10% = $185
Fun Spending of 20% = $371
Debt of 0% = $0
Obviously, that is not doable when living so close to minimum wage. So, you have to be strategic on ways to decrease your basic expenses and debt. Then, it will allow you more money to save and fun spending.
To further break down an example budget of $14 per hour, then using the ideal household percentages is extremely helpful.
recommended budget percentages based on $14 per hour wage:
Category
Ideal Percentages
Sample Monthly Budget
Giving
10%
$73
Savings
15-25%
$194
Housing
20-30%
$728
Utilities
4-7%
$121
Groceries
5-12%
$231
Clothing
1-4%
$24
Transportation
4-10%
$109
Medical
5-12%
$243
Life Insurance
1%
$21
Education
1-4%
$12
Personal
2-7%
$36
Recreation / Entertainment
3-8%
$61
Debts
0% – Goal
$0
Government Tax (including Income Tatumx, Social Security & Medicare)
15-25%
$574
Total Gross Income
$2427
**In this budget, prioritization was given to basic expenses. Thus, some categories like giving and saving were less.
$14 An Hour Salary Calculator
Now, you get to figure out how much you make based on your hours worked or if you make a wage between $14.01-14.99.
This is super helpful if you make $14.25, $14.50, or $14.75.
Living on $14 Per Hour
Living close to minimum wage can be a very difficult situation.
Is it doable? Probably not for long.
You just have to be wiser (or frugal) with your money and how you spend the hard-earned cash you have been blessed with.
A lot of times when people are making under near the minimum wage mark, they feel like they are in this constant cycle that they can never keep up with (which completely makes sense it is hard!).
When your thoughts are constantly focused on how you are struggling to keep up with bills and expenses, that is all you focus on.
You need to do is change your money mindset.
This is what you say to yourself… Okay, I am making near minimum wage for now. I have aspirations and goals to increase how much I make. For now, I am going to make sure that I am able to live on my 14 dollars per hour. I’m going to try and avoid debt and payday loans at all costs.
Other Tips to Help You:
Check your minimum wage for your state and city. You might find a higher minimum wage in a nearby city.
Look to living in a lower cost of living area to stretch your money.
Find ways to minizine your basic expenses.
Thrive with a frugal green minimalist lifestyle.
Decide if a roommate or moving back with your parents would help.
Bike or walk to work.
In the next section, we will dig into ways to increase your income, but for now, you must focus on living on $14 an hour.
5 Ways to Increase Your Hourly Wage
This right here is the most important section of this post.
You need to figure out ways to increase your hourly income because I’m going to tell you…you deserve more. You do a good job and your value is higher than what your employers pay you.
Even an increase of 50 cents to $14.50 will add up over the year. Even better $15 an hour!
1. Ask for a Raise
The first thing to do is ask for a raise. Walk right in and ask for a raise because you never know what the answer will be until you ask.
If you want the best tips on how specifically to ask for a raise and what the average wage is for somebody doing your job, then check out this book. In this book, the author gives you the exact way to increase your income. The purchase is worth it or go down to the library and check that book out.
2. Look for A New Job
Another way to increase your hourly wage is to look for a new job. Maybe a completely new industry.
It might be a total change for you, but many times, if you want to change your financial situation, then that starts with a career change. Maybe you’re stressed out at work. Making $14 an hour is too much for you and you’re not able to enjoy life, maybe changing jobs and finding another job may increase your pay, but it will also increase your quality of life.
3. Find a New Career
Because of student loans, too many employees feel like they are stuck in the career field they chose. They feel sucked into the job that they don’t like or have the potential they thought it would.
For many years, I was in the same situation until I decided to do a complete career change. I am glad I did. I have the flexibility that I needed in my life to do what I wanted when I needed to do it. Plus I am able to enjoy my entrepreneurial spirit.
4. Find Alternative Ways to Make Money
In today’s society, you need to find ways to make more money. Period.
There is no way to get around it. You need to find additional income outside a traditional nine to five position or typical 40 hour a week job. You will reach a point where you are maxed on what you can make in your current position or title. There may be some advancement to move forward, but in many cases, there just is not much room for growth.
So, you need to find a side hustle – another way to make money.
Do something that you enjoy, turn your hobby into a way to make money, turn something that you naturally do, and help others into a service business. In today’s society, the sky is the limit on how you can earn a freelancing income.
5. Earn Passive Income
The last way to increase your hourly wage is to start earning passive income.
This can be from a variety of ways including the stock market, real estate, online courses, book sales, etc. This is where the differentiation between struggling financially and being financially sound happens.
By earning money passively, you are able to do the things that you enjoy doing and not be loaded down, with having a job that you need to work, and a place that you have to go to. And you still make money doing nothing.
Here is an example:
You can start a brokerage account and start trading stocks for $50. You need to learn and take the one and only investing class I recommend. Learn how the market works, watch videos, and practice in a simulator before you start using your own money.
One gentleman started with $5,000 in his trading account and now has well over $36,000 in a year. Just from practice and being consistent, he has learned that passive income is the way for him to increase his income and also not be a slave to his job.
Tips to Live on $14 an Hour
In this last section, grasp these tips on how to live on $14 an hour. On our site, you can find lots of money saving tips to help stretch your income further.
Here are the most important tips to live on $14 an hour. Highlight these!
1. Spend Less Than you Make
First, you must learn to spend less than you make.
If not you will be caught in the debt cycle and that is not where you want to be. You will be consistently living paycheck to paycheck.
In order to break that dreadful cycle, it means your expenses must be less than your income.
And when I say income, it’s not the $14 an hour. As we talked about earlier in the post, there are taxes. The amount of taxes taken out of your paycheck is called your net income which is your home $14 an hour minus all the taxes, FICA, social security, and medicare are taken out. That is your net income.
So, your net income has to be less than your net income.
2. Living Below Your Means
You need to be happy. And living on less can actually make you happier. Studies prove that less is better.
Finding contentment in life is one thing that is a struggle for most.
We are driven to want the new shiny toy, the thing next door, the stuff your friend or family member got. Our society has trained you that you need these things as well.
Have you ever taken a step back and looked at what you really need?
Once you are able to find contentment with life, then you are going to be set for the long term with your finances.
Here is our story on owning less stuff. We have been happier since.
3. Make Saving Money Fun
You need to make saving money fun. Period.
It could be participating in a no spend challenge for the month.
Check out the 200 envelope challenge (which is doable on your income)
It could be challenging friends not to go to Target for a week.
Maybe changing your habits and not picking up takeout and planning meals.
Whatever it is challenge yourself.
Find new ways of saving money and have fun with it.
Even better, get your family and kids involved in the challenge to save money. Tell them the reason why you are saving money and this is what you are doing.
Here are 101 things to do with no money. Free activities without costing you a dime. That is an amazing resource for you and you will never be bored.
And you will learn a lot of things in life you can do for free. Personally, some of the best ones are getting outside and enjoying some fresh air.
4. Make More Money
If you want if you do not settle for less, then find ways to make more money. If you want more out of life, then increase your income.
You need to be an advocate for yourself.
Find ways to make more money.
It could be a side hustle, a second job, asking for a raise, going to school to change careers, or picking up extra hours.
Whatever path you take, that’s fine. Just find ways to make more money. Period.
5. No State Taxes
Paying taxes is one option to increase what you take home in each paycheck.
These are the states that don’t pay state income taxes on wages:
Alaska
Florida
Nevada
New Hampshire
South Dakota
Tennessee
Texas
Washington
Wyoming
It is very interesting if you take into account the amount of state taxes paid compared to a state with income taxes.
Also, if you live in one of the higher taxed states, then you may want to reconsider moving to a lower cost of living area. The higher taxes income tax states include California, Hawaii, New Jersey, Oregon, Minnesota, the District of Columbia, New York, Vermont, Iowa, and Wisconsin. These states tax income somewhere between 7.65% – 13.3%.
6. Stick to a Budget
You need to learn how to start a budget. We have tons budgeting resources for you.
While creating a budget is great, you need to learn how to use one.
You do not have to budget down to every last penny.
You need to make sure your expenses are less than your income and that you are creating sinking funds for those irregular expenses.
Budget Help:
7. Pay Off Debt Quickly
The amount that you pay interest on debt is absolutely absurd.
Unfortunately, that is how many of these companies make their money from the interest you pay on debt.
If you are paying 5% to even 20-21% or higher, you need to find ways to lower that debt quickly.
Here’s a debt calculator to help you. Figure out your debt free date.
Make that paying off debt fast is your target and main focus. I can tell you from personal experience, that it was not until week paid off our debt that we finally rounded the corner financially. Once our debt was paid off, we could finally be able to save money. Set money aside in separate bank accounts and pay for cash for things.
It took us working hard to pay off debt. We needed persistence and patience while we had setbacks in our debt free journey.
Jobs that Pay $14 an Hour
You can always find jobs that pay $14 per hour. Polish up that smile, fill out the application, and be prepared with your interview skills.
Job Search Hint: Always send a written follow-up thank you note for your interview. That will help you get noticed and remembered.
First, look at the cities that require a minimum wage in their cities. That is the best place to start to find jobs that are going to pay higher than the federal minimum wage rate. Many of the cities are moving towards this model so, target and look for jobs in those areas.
Possible Ideas:
Cashiers
Back of the house restaurant staff
Landscape Laborer
Retail jobs
Paraeducators at schools
Janitors
Farm help
Warehouse workers
Fast Food Restaurants workers
$14 Per Hour Annual Salary
In this post, we detailed 14 an hour is how much a year. Plus all of the variables can impact your net income. This is something that you can live off.
How much is 14 dollars an hour annually…
$29120
This is under $30000 per year and you need to make at least $43k a year.
In this post, we highlighted ways to increase your income as well as tips for living off your wage.
Use the sample budget as a starting point with your expenses.
You will have to be savvy and wise with your hard-earned income. But, with a plan, anything is possible!
Learn exactly how much do I make per year…
Know someone else that needs this, too? Then, please share!!
When you start shopping for life insurance, you can be overwhelmed with the number of options that you have. There are hundreds and hundreds of life insurance companies on the market. How in the world are you supposed to decide which one is the best for you?
That’s why I’m here to help. I’ve reviewed dozens of different insurance companies to give you an idea of which one might work best for you.
Life insurance is one of the most important investments that you’ll ever make for your family, and it’s vital that you make the best decision for your family. One of the most important factors that you should consider is the type of life insurance policy that you are going to buy. There are several different kinds of coverage that you will need to review based on your needs.
In addition, it is also recommended that you review the background of the insurance company you are considering buying this type of coverage through. That is because you will want to ensure that the carrier is strong financially and that is has a good name in the industry for timely payment of its policy holder claims. One insurance carrier that meets these points is Erie Insurance Company.
The History of Erie Life Insurance Company
Erie Insurance Company has been in the business of offering coverage protection to its customers for nearly 100 years. The company was founded in the early 1920s when two employees of the Pennsylvania Indemnity Exchange decided to form their own insurance carrier.
In moving forward with their new company, H.O. Hirt and O.G. Crawford raised more than $30,000, and won over 90 stockholders – all from a hand written business plan. Then, in April of 1925, the Erie Insurance Exchange opened its doors.
Over the years, the company has grown and expanded exponentially, adding many different types of coverage, such as home owners, motorcycle, boat, life, business, and personal valuables coverage.
Erie Life Insurance Company Review
Today, Erie Insurance Company has more than 5,000 employees who serve its customers and policy holders. The company’s products are offered via approximately 12,000 independent insurance agents across the United States.
In addition to providing a variety of insurance coverage’s, Erie Insurance Company gives back to the communities in which it serves. For example, the company is involved in entities such as Meals on Wheels, coaching little league sports, and with helping people to rebuild following natural disasters and catastrophes.
Erie is considered to be a strong and stable life insurance company from a financial standpoint. The company has also been listed as number 411 on the 2016 Fortune 500 list. (The company made its initial debut on this list back in 2003).
Also, for the fifth year in a row, Erie Insurance was given the “Highest Satisfaction with the Auto Insurers Shopping Experience” award in the J.D. Power 2017 U.S. Insurance Shopping Study. Out of a possible score of 1,000 Erie obtained a score of 879.
BBB Grade and Ratings
Due to its strong financial foothold, Erie has received very high ratings from the insurer rating agencies. Here, the Erie Insurance Group has earned an A+ (Superior) rating from A.M. Best and Company, and the Erie Family Life Insurance Company has earned an A.M. Best grade of A (Excellent).
In addition to its high insurer ratings, Erie Insurance has also been given a grade of A+ (on a scale of A+ to F) from the Better Business Bureau (BBB). Although Erie Insurance is not an accredited member of the BBB, the company has closed out a total of 59 customer complaints over the past three years (of which 16 were closed out during the past 12 months).
Of the total 59 customer complaints that Erie has closed via the BBB, 39 had to do with problems with the company’s product and / or service, and 15 had to do with billing and / or collection issues. An additional two were in regard to advertising and / or sales issues, two had to do with delivery issues, and the remaining one was in regard to the company’s guarantee and / or warranty issues.
Life Insurance Coverage Offered by Erie Life Insurance Company
Erie Insurance offers a variety of different life insurance coverage options to choose from. These include both term and permanent policies. With a term life insurance policy, death benefit protection is offered, without any type of savings or cash value build up. Because of this, the premium that is charged for term life insurance is usually much lower than that of a comparable permanent plan.
With a term life insurance policy, coverage is purchased for a certain period of time, such as 10 years, 20 years, or even 30 years. Typically, these policies will have a fixed amount of death benefit, as well as a fixed premium charge for the life of the plan.
Erie Insurance offers level term life insurance protection, and policies can be chosen in time periods of 10, 15, 20, or 30 years. This coverage can be purchased starting at age 0, and in many instances, the policy holder will have the opportunity of converting the term policy over into a permanent life insurance policy – which can then provide coverage for the remainder of the insured’s lifetime.
With Erie, there is oftentimes no medical exam required on its term life policies of up to $90,000 in death benefit protection. All an applicant has to do is just simply answer a few health related questions. And, because there is no blood work or medical exam results to wait for, this coverage can usually be approved and issued within just days (or possibly even sooner).
The company also offers permanent life insurance coverage. With a permanent life insurance policy, there is death benefit protection, as well as cash value build up. The assets that are inside of the cash component of the policy can grow on a tax deferred basis. Essentially there is no tax due on the gain until these funds are withdrawn.
Erie Insurance offers both whole life and universal life for permanent life insurance coverage. With a whole life insurance policy, the insured will have guaranteed life insurance protection with a death benefit amount that will not decrease – even as he or she ages throughout the years.
These whole life plans also offer guaranteed cash value, as well as a set premium that will not be raised – even if the insured contracts an adverse health condition in the future. Plus, the insurance company cannot cancel the policy for any reason, if the premium is paid.
There are several different premium payment options that a whole life insurance policy holder can choose from – based on what suits their needs the best. There are also several different riders that may be added to the whole life insurance coverage – some at no additional charge.
Just like with the term insurance policies, whole life insurance plans through Erie offer a fast and easy application process. For those who wish to purchase coverage of up to $90,000, only a new medical questions need to be answered.
Whole life insurance protection from Erie can be purchased for adults and children (or other younger relatives, such as grandchildren and nieces / nephews). These plans can help the younger insureds to build up savings in a tax deferred manner, and to attain guaranteed insurability in the future.
Erie Insurance also offers universal life insurance. Universal life, or UL, is another form of permanent life insurance coverage. In many ways, UL is considered to be more flexible than whole life. This is because the policy holder – within certain guidelines – may choose how much of the premium will go towards the death benefit, and how much will go into the cash value portion of the policy. They may also be able to change the due date of the policy’s premium, based on their changing needs.
Universal life insurance can be advantageous for individuals and for business owners, as it offers guaranteed cash value, as well as the ability to get policy loans with tax free income potential.
These types of life insurance plans can also be ideal for a wide variety of coverage needs, such as:
College expense planning
Estate planning
Income replacement
Charitable giving
Wealth transfer
Inheritance
Mortgage balance payoff
Payoff of personal or other types of debt balances
Retirement income planning
Deferred compensation plans
Business continuation coverage
Key person coverage
While a universal life insurance policy offers both death benefit coverage and cash value, the premium on this type of coverage may be more affordable than that of a whole life insurance policy, depending on the insured’s specific parameters.
Burial Insurance
If you’re worried about leaving those you care about with funeral and final expenses, having a burial insurance policy can help. Today, the average cost of a funeral can be in the range of $8,500 to $10,000 – especially when factoring in items like the memorial service itself, along with flowers, transportation, and music, as well as a burial plot and a headstone.
Burial insurance – which is also oftentimes referred to as funeral insurance or final expense life insurance – is a type of coverage that will pay out a benefit quickly to your named beneficiary so that final expenses can be paid…and so that your survivors don’t have to dip into saving or use credit to pay these costs. With that in mind, having a burial insurance policy can be one of the greatest gifts you give to your family.
Before you purchase a burial insurance policy, though, it is important that you have a good idea of the type and the amount of coverage you’ll need. For example, you may want to only cover the anticipated cost of a funeral service. Or, alternatively, you may also want to add in some additional protection so that your loved ones can pay off other debts, such as final medical expenses and / or the cost of hospice care.
Other Products and / or Services Offered
In addition to just selling life insurance policies, Erie Insurance Company offers a long list of valuable products and services. These include the following:
Auto Insurance
Motorcycle Insurance Coverage
Insurance Coverage for Car Collectors, ATVs, and RVs
Insurance for Teen Drivers
Boat Insurance Coverage
Home Owners Insurance
Renters Insurance Coverage
Condo Insurance
Mobile Home Insurance
Personal Valuables Insurance
Flood Insurance
Retirement Solutions
Personal Catastrophe Liability Insurance
Identity Theft Recovery Coverage
Business Insurance
Erie also offers various industry insurance packages that can be fit to companies in a variety of different industries, such as auto services, contractors, hotels and hospitality, landlords and property owners, manufacturers, offices and professional services, restaurants, retail, and wholesaler-distributors.
Looking For The Best Premium Rates on Life Insurance Coverage from Erie Insurance?
If you are seeking the best premium rate on life insurance coverage from Erie Insurance Company – or from any insurer – it is recommended that you work together with an independent life insurance agency or broker. That way, you will be in a better position to compare, side-by-side, the coverage and the premium prices of numerous insurers – but in an impartial manner. You can then determine which will be best for you.
When you are ready to shop around, we can help you. How? We work with the best life insurance providers. We can provide you with the important details that you need for making a well-informed decision – and we can do this for you directly from your own computer. When you are ready to proceed, just simply fill out our short quote form.
We get that buying life insurance coverage is a big decision. There are many different parameters to keep in mind – and you want to be sure that you are going with the right type and amount of coverage through the best insurance company.
This process of purchasing life insurance protection can be made so much easier by working with an aid on your side who can guide you through the entire way, from beginning to end. So, contact us today – we’re here to help.
When you’re considering applying for a mortgage, one of your top questions is probably “What is the monthly payment going to be?”
For a 100K mortgage, the payment on a 30-year loan at 7% interest would be $665.30. For a 15-year mortgage loan term, the payment increases to $898.83, which helps you pay off the loan sooner and pay less in interest costs over the entire loan.
Your own loan will depend on a number of factors, including but not limited to fluctuating interest rates. Here’s what goes into a 100K mortgage, what income is required to get one, and what your payments would look like over the life of the loan.
Total Cost of a 100K Mortgage
The total cost of a 100K mortgage goes beyond the monthly payment. There are upfront costs and ongoing, long-term costs to consider, all of which affect how much house can you afford.
Upfront Costs
Upfront home loan costs can include:
• Closing Costs: There are costs you need to pay to get a mortgage, but they are not a part of the original loan. These are known as closing costs and include things like the mortgage origination fee, the cost of an appraisal, attorney fees, title fees, taxes, prepaids, and other expenses. With the average closing cost on a new home adding between 3% and 6%, that works out to $3,000 to $6,000 on a 100K mortgage.
• Down Payment: Unless you are able to obtain a 0% down payment loan, you’ll need some money to afford the down payment on a 100K mortgage loan.
The average down payment on a home is 13%, as per the National Association of Realtors®. This works out to $13,000 on a $100,000 home.
If you don’t quite have this amount, there are other types of mortgage loans that offer low down payment options. 3% and 3.5% are common, which would come out to $3,000 and $3,500 for the down payment on a 100K home.
Long Term Costs
Here are the ongoing costs of a mortgage loan:
• Interest. The biggest expense you’ll have over the life of the loan is interest. Interest costs are huge, especially in an economy with higher annual percentage rates (APRs). You’ll pay more in interest than you do in principal if you keep the mortgage loan for the whole 30-year loan term.
For a $100K mortgage with a 30-year term and 7% APR, the interest costs total $139,508.90.That’s on top of the $100,000 original loan amount. Adding the two together, you’re looking at paying $239,508.90 for the original 100K mortgage. Take a look at our mortgage payment calculator or the amortization table further down if you’re more curious about this amount.
• Escrow. You may pay for taxes and insurance through your escrow account every month. This expense doesn’t go away, even when you pay off your mortgage. The amount of tax and insurance varies by state and policy.
Estimated Monthly Payments of a 100K Mortgage
Payments on a 100K home will ultimately be determined by your loan term and interest rate. And the interest rate is determined by a number of factors. Of course, the Fed’s rate matters, but so too do such aspects as:
• Credit score. A good credit score can afford you a lower interest rate on your mortgage.
• Down payment. Generally, putting down a larger down payment affords you a lower interest rate.
• Home location. There are certain areas where you may be offered a lower interest rate just because of where you live.
• Loan amount. If you need a larger loan, such as a jumbo loan, you’ll usually see a higher interest rate. The same can be true of much smaller homes, such as tiny homes.
• Interest rate type. If you choose a loan with an adjustable APR, you may initially have a lower interest rate.
• Loan type. You’ll see different interest rates based on what loan type you’re using. Examples include VA loans, FHA loans, and a USDA loan which may offer a lower (or no) down payment as well as lower interest rates.
• Loan term. Choosing a mortgage term that’s shorter can help you score a lower interest rate.
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Recommended: First-Time Homebuyer Guide
Monthly Payment Breakdown by APR and Term
It’s helpful to see what potential mortgage loan payments on a 100K mortgage may be, adjusting for term length and APR variance. Keep in mind these costs do not include escrow items, such as taxes or insurance.
APR
Monthly Payment on a 30-Year Loan
Monthly Payment on a 15-Year Loan
3.5%
$449.04
$714.88
4%
$477.42
$739.69
4.5%
$506.69
$764.99
5%
$536.82
$790.79
5.5%
$567.79
$817.08
6%
$599.55
$843.86
6.5%
$632.07
$871.11
7%
$665.30
$898.83
7.5%
$699.21
$927.01
8%
$733.76
$955.65
8.5%
$768.91
$984.74
9%
$804.62
$1,014.27
9.5%
$840.85
$1,044.22
10%
$877.55
$1,074.61
How Much Interest Is Accrued on a 100K Mortgage?
Each month, your payment is split into principal and interest payments. Those interest payments go to the bank as payment for lending you money. Principal payments go toward the original loan amount and pay down the loan.
The longer the loan term, the more you’ll pay in overall interest. For a 100K mortgage on a 30-year term with a 7% APR, the interest costs total $139,508.90 on top of the original loan.
On a 15-year term with the same parameters, the interest costs are a more modest $61,789.09. Yes, your monthly payments are higher, but the difference between a 15 vs. 30 year mortgage with 7% APR is significant.
Recommended: Home Loan Help Center
100K Mortgage Amortization Breakdown
The amortization of a 100K mortgage shows how much of your monthly payment pays off the loan each month.
You can see in the early years of your mortgage, more of your monthly payment goes toward interest, and very little of your loan is paid off. In later years, more of the payment will go toward the principal.
Year
Monthly Payment
Beginning Balance
Total Amount Paid
Interest
Principal
Ending Balance
1
$665.30
$100,000.00
$7,983.60
$6,967.81
$1,015.79
$98,984.19
2
$665.30
$98,984.19
$7,983.60
$6,894.39
$1,089.21
$97,894.95
3
$665.30
$97,894.95
$7,983.60
$6,815.64
$1,167.96
$96,726.96
4
$665.30
$96,726.96
$7,983.60
$6,731.21
$1,252.39
$95,474.55
5
$665.30
$95,474.55
$7,983.60
$6,640.66
$1,342.94
$94,131.59
6
$665.30
$94,131.59
$7,983.60
$6,543.59
$1,440.01
$92,691.55
7
$665.30
$92,691.55
$7,983.60
$6,439.49
$1,544.11
$91,147.41
8
$665.30
$91,147.41
$7,983.60
$6,327.86
$1,655.74
$89,491.65
9
$665.30
$89,491.65
$7,983.60
$6,208.17
$1,775.43
$87,716.19
10
$665.30
$87,716.19
$7,983.60
$6,079.81
$1,903.79
$85,812.38
11
$665.30
$85,812.38
$7,983.60
$5,942.19
$2,041.41
$83,770.95
12
$665.30
$83,770.95
$7,983.60
$5,794.61
$2,188.99
$81,581.94
13
$665.30
$81,581.94
$7,983.60
$5,636.38
$2,347.22
$79,234.69
14
$665.30
$79,234.69
$7,983.60
$5,466.70
$2,516.90
$76,717.75
15
$665.30
$76,717.75
$7,983.60
$5,284.75
$2,698.85
$74,018.87
16
$665.30
$74,018.87
$7,983.60
$5,089.64
$2,893.96
$71,124.88
17
$665.30
$71,124.88
$7,983.60
$4,880.45
$3,103.15
$68,021.68
18
$665.30
$68,021.68
$7,983.60
$4,656.10
$3,327.50
$64,694.16
19
$665.30
$64,694.16
$7,983.60
$4,415.56
$3,568.04
$61,126.09
20
$665.30
$61,126.09
$7,983.60
$4,157.62
$3,825.98
$57,300.08
21
$665.30
$57,300.08
$7,983.60
$3,881.03
$4,102.57
$53,197.49
22
$665.30
$53,197.49
$7,983.60
$3,584.46
$4,399.14
$48,798.32
23
$665.30
$48,798.32
$7,983.60
$3,266.46
$4,717.14
$44,081.14
24
$665.30
$44,081.14
$7,983.60
$2,925.44
$5,058.16
$39,022.95
25
$665.30
$39,022.95
$7,983.60
$2,559.78
$5,423.82
$33,599.10
26
$665.30
$33,599.10
$7,983.60
$2,167.69
$5,815.91
$27,783.17
27
$665.30
$27,783.17
$7,983.60
$1,747.26
$6,236.34
$21,546.80
28
$665.30
$21,546.80
$7,983.60
$1,296.45
$6,687.15
$14,859.60
29
$665.30
$14,859.60
$7,983.60
$813.02
$7,170.58
$7,688.98
30
$665.30
$7,688.98
$7,983.60
$294.64
$7,688.96
$0.00
What Is Required to Get a 100K Mortgage?
When you’re applying to qualify for a mortgage, lenders look for a few key things to approve your application.
• How much debt you will be carrying. Lenders look for your monthly payment to be lower than 28% of your gross monthly income. A 100K mortgage payment at 7% interest on a 30-year term is $665.30. For this payment to be less than 28% of your monthly income, your monthly income needs to be over $2,376, assuming you have no debt. This turns into a $28,512 yearly salary requirement to afford a 100K mortgage payment.
If you have debt, the calculation changes a little bit. Your lender will add your monthly debts to your projected monthly mortgage payment. These two numbers added together need to be less than 36% of your monthly income. This calculation a lender does is known as the debt-to-income ratio, or back-end ratio.
• Credit score. It’s advisable to have a credit score of 620 or higher when applying for a mortgage loan.
• Consistent work history. If you are unemployed, self-employed, or have recently changed jobs, lenders may be less likely to approve your loan. They may worry about your having a steady enough income to make your payments.
The Takeaway
A 100K mortgage will have a monthly cost that varies depending on such factors as the loan’s interest rate, the term of the loan, and whether it’s a fixed- or variable-rate loan. By understanding more about how the cost of a mortgage is calculated, plus the related costs, you can be better prepared for the milestone of being a homeowner.
When you’re ready to apply for a mortgage, SoFi will be there for you. Our rates are competitive, and we offer flexible loan terms and down payment options (as little as 3% for first-time homebuyers) to suit your needs. The online application simplifies the process, and our dedicated Mortgage Loan Officers can help you every step of the way.
See how smart and simple a SoFi Mortgage Loan can be.
Photo credit: iStock/AndreyPopov
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances. SoFi Mortgages Terms, conditions, and state restrictions apply. Not all products are available in all states. See SoFi.com/eligibility for more information. SoFi Loan Products SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender. Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website . SOHL0323001
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36k salary is a solid hourly wage; above most minimum hourly wage jobs.
For most people, an entry-level job would be paying just over $36,000 a year. The question that remains is can you make a living off $36k a year.
The median household income is $67,521 in 2020 which decreased by 2.9% from the previous year (source). Think of it as a bell curve with $68K at the top; the median means half of the population makes less than that and half makes more money.
The average income in the U.S. is $48,672 for a 40-hour workweek; that is an increase of 4% from the previous year (source). That means if you take everyone’s income and divided the money evenly between all of the people.
But, the question remains can you truly live off 36,000 per year in today’s society since it is well below both the average and median household incomes? The question you want to ask all of your friends is $36000 per year a good salary.
In this post, we are going to dive into everything that you need to know about a $36000 salary including hourly pay and a sample budget on how to spend and save your money.
These key facts will help you with money management and learn how much per hour $36k is as well as what you make per month, weekly, and biweekly.
Just like with any paycheck, it seems like money quickly goes out of your account to cover all of your bills and expenses, and you are left with a very small amount remaining. You may be disappointed that you were not able to reach your financial goals and you are left wondering…
Can I make a living on this salary?
$36000 a year is How Much an Hour?
When jumping from an hourly job to a salary for the first time, it is helpful to know how much is 36k a year hourly. That way you can decide whether or not the job is worthwhile for you.
36000 salary / 2080 hours = $17.31 per hour
$36000 a year is $17.31 per hour
Let’s breakdown how that 36000 salary to hourly number is calculated.
For our calculations to figure out how much is 36K salary hourly, we used the average five working days of 40 hours a week.
Typically, the average workweek is 40 hours and you can work 52 weeks a year. Take 40 hours times 52 weeks and that equals 2,080 working hours. Then, divide the yearly salary of $36000 by 2,080 working hours and the result is $17.31 per hour.
Just above $17 an hour.
That number is the gross hourly income before taxes, insurance, 401K, or anything else is taken out. Net income is how much you deposit into your bank account.
You must check with your employer on how they plan to pay you. For those on salary, typically companies pay on a monthly, semi-monthly, biweekly, or weekly basis.
What If I Increased My Salary?
Just an interesting note… if you were to increase your annual salary by $7K to $43K per year, it would increase your hourly wage to over $20 an hour – a difference of $3.36 per hour.
To break it down – 43k a year is how much an hour = $20.67
That difference will help you fund your savings account; just remember every dollar adds up.
How Much is $36K salary Per Month?
On average, the monthly amount would be $3,000.
Annual Salary of $36000 ÷ 12 months = $3000 per month
This is how much you make a month if you get paid 36000 a year.
$36k a year is how much a week?
This is a great number to know! How much do I make each week? When I roll out of bed and do my job of $36k salary a year, how much can I expect to make at the end of the week for my effort?
Once again, the assumption is 40 hours worked.
Annual Salary of$36000/52 weeks = $692 per week.
$36000 a year is how much biweekly?
For this calculation, take the average weekly pay of $692 and double it.
This depends on how many hours you work in a day. For this example, we are going to use an eight-hour workday.
8 hours x 52 weeks = 260 working days
Annual Salary of$36000 / 260 working days = $138 per day
If you work a 10 hour day on 208 days throughout the year, you make $173 per day.
$36000 Salary is…
$36000 – Full Time
Total Income
Yearly Salary (52 weeks)
$36,000
Monthly Salary
$3,000
Weekly Wage (40 Hours)
$692
Bi-Weekly Wage (80 Hours)
$1,384
Daily Wage (8 Hours)
$138
Daily Wage (10 Hours)
$173
Hourly Wage
$17.31
Net Estimated Monthly Income
$2,290
Net Estimated Hourly Income
$13.21
**These are assumptions based on simple scenarios.
36k a year is how much an hour after taxes
Income taxes is one of the biggest culprits of reducing your take-home pay as well as FICA and Social Security. This is a true fact across the board with an all-salary range up to $142,800.
When you make below the average household income, the amount of taxes taken out hurts your hourly wage.
Every single tax situation is different.
On the basic level, let’s assume a 12% federal tax rate and a 4% state rate. Plus a percentage is taken out for Social Security and Medicare (FICA) of 7.65%.
So, how much an hour is 36000 a year after taxes?
Gross Annual Salary: $36,000
Federal Taxes of 12%: $4,320
State Taxes of 4%: $1,440
Social Security and Medicare of 7.65%: $2,754
$36k Per Year After Taxes is $27,486
This would be your net annual salary after taxes.
To turn that back into an hourly wage, the assumption is working 2,080 hours.
$27486 ÷ 2,080 hours = $13.21 per hour
After estimated taxes and FICA, you are netting $27,486 per year, which is $8,514 per year less than what you expect.
***This is a very high-level example and can vary greatly depending on your personal situation and potential deductions. Therefore, here is a great tool to help you figure out how much your net paycheck would be.***
Taxes Based On Your State
In addition, if you live in a heavily taxed state like California or New York, then you have to pay way more money than somebody that lives in a no tax state like Texas or Florida. This is the debate of HCOL vs LCOL.
Thus, your yearly gross $36000 income can range from $24,606 to $28,926 depending on your state income taxes.
That is why it is important to realize the impact income taxes can have on your take home pay. It is one of those things that you should acknowledge and obviously you need to pay taxes. But, it can also put a huge dent in your ability to live the lifestyle you want on a $36,000 income.
How Much Is 36K A Year Hourly Salary Calculator
More than likely, your salary is not a flat 36k, here is a tool to convert salary to hourly calculator.
Many entry-level jobs start at this range, which may make you believe that a business degree is worth it.
36k salary lifestyle
Every person reading this post has a different upbringing and a different belief system about money. Therefore, what would be a lavish lifestyle to one person, maybe a frugal lifestyle to another person? And there’s no wrong or right, it is what works best for you.
One of the biggest factors to consider is your cost of living.
In another post, we detailed the differences of living in an HCOL vs LCOL vs MCOL area. When you live in big cities, trying to maintain your lifestyle of $36,000 a year is going to be extremely difficult because your basic expenses, housing, transportation, food, and clothing are going to be much more expensive than you would find in a lower cost area.
To stretch your dollar further in the high cost of living area, you would have to probably live a very frugal lifestyle and prioritize where you want to spend money and where you do not. Whereas, if you live in a low-cost of living area, you can afford the cost of living and maybe save more money. Thus, you have more fun spending left in your account each month.
As we noted earlier in the post, $36,000 a year is well below the average income that you would find in the United States. Thus, you have to be wise in how you spend your money.
What a $36,000 lifestyle will buy you:
If you are debt free and utilize smart money management skills, then you are able to enjoy the lifestyle you want.
You are able to rent in a decent neighborhood in LCOL.
Driving a beater car is normal.
You should be able to meet your basic expenses each and every month.
Not be able to afford many of the fun spending luxuries.
Ability to make sure that saving money is a priority, and very possibly save $5000 in one year.
When A $36,000 Salary Will Hold you Back:
However, if you are riddled with debt or unable to break the paycheck to paycheck cycle, then living off of 36k a year is going to be pretty darn difficult.
There are two factors that will keep holding you back:
You must pay off debt and cut all fun spending and extra expenses.
Break the paycheck-to-paycheck cycle.
It is possible to get ahead with money!
It just comes with proper money management skills and a desire to have less stress around money. That is a winning combination regardless of your income level.
$36K a year Budget – Example
As always, here at Money Bliss, we focus on covering our basic expenses plus saving and giving first, and then our goal is to eliminate debt. The rest of the money leftover is left for fun spending.
If you want to know how to manage a 36k salary the best, then this is a prime example for you to compare your spending.
You can compare your budget to the ideal household budget percentages.
recommended budget percentages based on $36000 a year salary:
Category
Ideal Percentages
Sample Monthly Budget
Giving
10%
$150
Savings
15-25%
$450
Housing
20-30%
$884
Utilities
4-7%
$135
Groceries
5-12%
$270
Clothing
1-4%
$18
Transportation
4-10%
$135
Medical
5-12%
$150
Life Insurance
1%
$8
Education
1-4%
$8
Personal
2-7%
$24
Recreation / Entertainment
3-8%
$60
Debts
0% – Goal
$0
Government Tax (including Income Tatumx, Social Security & Medicare)
15-25%
$710
Total Gross Monthly Income
$3000
**In this budget, prioritization was given to basic expenses and no debt.
Is $36,000 a year a Good Salary?
As we stated earlier if you are able to make $36,000 a year, that is a low salary. You are making around or just above minimum wage.
While 36000 is a decent salary just starting out in your working years, it is a salary that you want to rapidly increase before your expenses go up or the people you provide for increase. If not, you will be left working multiple jobs to make ends meet.
However, too many times people get stuck in the lifestyle trap of trying to keep up with the Joneses, and their lifestyle desires get out of hand compared to their salary. And what they thought used to be a great salary actually is not making ends meet at this time.
This $36k salary would be considered a lower class salary. You must make each dollar count in your budget.
Check: Are you in the middle class?
In fact, this income level in the United States has enough buying power to put you in the top 95 percentile globally for per person income (source).
The question you need to ask yourself with your 36k salary is:
Am I maxed at the top of my career?
Is there more income potential?
What obstacles do I face if I want to try to increase my income?
In the future years and with possible inflation, in many modest cities 36,000 a year is not a good salary because the cost of living is so high, whereas these are some of the cities where you can make a decent living at 36000 per year.
If you are looking for a career change, you want to find jobs paying at least $45000 a year.
Is 36k a good salary for a Single Person?
Simply put, you can make it work.
You can stretch your salary much further because you are only worried about your own expenses. A single person will spend much less than if you need to provide for someone else.
Your living expenses and ideal budget are much less. Thus, you can live comfortably for $36000 per year.
And… most of us probably regret how much money wasted when we were single. Oh well, lesson learned.
Is 36k a good salary for a family?
Many of the same principles apply above on whether $36000 is a good salary. The main difference with a family, you have more people to provide for than when you are single or have just one other person in your household.
At the 36K salary with a family, you would need more than one income stream to make this possible without government help.
The costs of raising children are high and will steeply cut into your income. As you can tell this is a huge dent in your income, specifically $12,980 annually per child and this does not include college.
That means that amount of money is coming out of the income that you earned.
So, the question really remains can you provide a good life for your family making $36,000 a year? This is the hardest part because each family has different choices, priorities, and values.
More or less, it comes down to two things:
The location where you live in.
Desire to improve your career and make more money.
Your lifestyle choices.
You will not be able to afford everything on this salary.
Many times when raising a family, it is helpful to have a dual-income household. That way you are able to provide the necessary expenses if both parties were making 36,000 per year, then the combined income for the household would be $72,000. Thus making your combined salary a very good income.
Learn how much money a family of 4 needs in each state.
Can you Live on 36000 Per Year?
As we outlined earlier in the post, $36000 a year:
$17.31 Per Hour
$138-173 Per Day (depending on the length of day worked)
$692 Per Week
$1384 Per Biweekly
$3000 Per Month
Next up is making $40,000 a year.
Like anything else in life, you get to decide how to spend, save and give your money.
That is the difference for each person on whether or not you can live a lower-class lifestyle depends on many potential factors. If you live in California or New Jersey you are gonna have a tougher time than Oklahoma or even Texas.
In addition, if you are early in your career, starting out around 32,000 a year, that is a okay place to be getting your career. However, if you have been in your career for over 20 years and still making $36K, then you probably need to look at asking for pay increases, pick up a second job, or find a different career path.
Regardless of the wage that you make, if you are not able to live the lifestyle that you want, then you have to find ways to make it work for you. Everybody has choices to make.
But one of the things that can help you the most is to stick to our ideal household budget percentages to make sure you stay on track.
Learn exactly how much do I make per year…
One of the best ways to improve your personal finance situation is to increase your income. Here are a variety of side hustles that are very lucrative. With time and effort, you can start enjoying the lifestyle you want.
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These days, my monthly budget is on the boring side. Aside from our regular spending, I’ve got a mortgage payment to fork over, groceries to buy, and utility bills to pay. Throw in some payments to my kids’ 529 plans and my SEP-IRA and I’m basically done for the month. After all of the bills are paid, the key for us is making sure that the rest gets transferred into savings so that it doesn’t accidentally get spent.
But it wasn’t always this way, and I was reminded of that fact the other day when I was flipping through one of my old notebooks. That’s when I found our monthly zero-sum budget for August of 2010, and that’s when our old lifestyle smacked me right in the face. Want to know how many bills I paid in that month? Twenty-four.
Car payments, credit card bills, and personal loans, oh my. It’s no wonder we weren’t saving anything. Fortunately, it was easy to look at that old monthly budget and pinpoint the exact cause of our unfortunate situation. The problem: We financed everything and never, ever paid cash.
Low Monthly Payments for Life
Fact: You can have nearly anything you want.
I can too. We all can. Cars. Clothes. Diamonds. Trips to Hawaii. Almost any earthly possession you’ve ever laid your eyes on can be yours.
Well, kind of.
If you’re willing to make monthly payments for as long as it takes, whether it’s five years, ten, or twenty, then it can be yours. Does that sound tempting? Probably not.
But that’s exactly what we do. In the fourth quarter of 2013, U.S household debt swelled to a monstrous $11.52 trillion. Of course, some of the money was borrowed to purchase homes, pay for college, or start a business. A certain percentage can also be blamed on things like medical bills, unemployment, and emergencies. But the rest? My guess is boats, iPads, and designer shoes. Oh, and let’s not forget furniture, date nights, and family dinners at the Olive Garden. The rest is anyone’s guess.
Stop the Cycle
We all know how easy it is to trade your car in for another. You walk into the dealership, they look your trade over, and you pick out another, nicer car. Your new car payment could even be the same as it was before. Hell, it might even go down. But are you really doing yourself a favor by trading up without the cash in hand? The answer is probably no.
I’ve been there. My husband and I traded cars around more times than I could count, mostly just because we would. Looking back, I think we were just bored. And sadly, we weren’t able to see that there were real costs associated with constantly trading up. We only focused on the monthly payment, and never had the goal of actually paying them off.
Fortunately, we finally made the decision to change our lifestyle sometime around the time that that budget was made. And once we stopped the madness, we made one huge change that put an end to the cycle once and for all. We began paying cash for anything and everything, and we refused to add to the pile by financing things we couldn’t afford.
Turning an Awkward Moment Into a Learning Experience
In the meantime, we got serious about getting out of debt. Fortunately, it didn’t take long to knock out everything but the two biggest sums we owed — the loan for my minivan and my husband’s student loans. I still remember the day we paid both of them off once and for all. The total was well over $10,000 and it literally pained me to hit the keys that would initiate the automatic bank transfer. I mean, it hurt. That money was mine and was earned with my own blood, sweat, and tears. And if you subscribe to the theories espoused in books like Your Money or Your Life, that money was literally my life force, and it was getting sucked away by a stupid van that I overpaid for in the first place.
I still have that van. Want to know why? Because it’s paid off, as is everything else I own. And now I’m literally gonna drive that van until the wheels fall off, or until the engine finally gives up or explodes out of sheer exhaustion at maybe 500,000 miles. (A girl can dream, right?)
I learned something from our adventures in debt and from that final $10,000 payment — most notably that I never, ever want to go down that road again. Parting with that much money at once was painful. It burned.It made me uncomfortable. And now, years later, I’m convinced that that’s exactly how it should feel.
Pay Cash and Feel the Burn
Since then, we’ve paid for everything with cash including a car for my husband, furniture, home remodeling projects, and more. And even though it has sometimes been painful, our refusal to finance anything has been a game-changer for our financial future. Here’s why:
Paying in cash forces you to consider the real purchase price – No matter what you’re buying, the fact that you’re paying in cash turns it into an entirely different experience. That’s because you have no choice but to consider how much money you’re paying overall, and not just what you’ll have to pay on a monthly or yearly basis.
Paying in cash might help you spend less – When you force yourself to pay in cash, big ticket items start to lose their appeal. Try walking into a dealership with the intention of paying $15,000 or $20,000 for a newer car. All of a sudden, the prospect of keeping your old paid-off junker becomes an incredibly attractive option. Am I wrong?
Paying in cash keeps you out of debt – The best thing about refusing to finance things is that it keeps you out of debt in the first place. We all know what a slippery slope that can be. There are so many benefits to being debt-free, including the option to save more of your income, less stress, and of course, the feeling of not really being beholden to anyone. It’s a freeing feeling, and it’s one that I will never, ever surrender without a fight.
If you’re in debt and are ready to make a change, start by creating a debt snowball. Conquer each one of your debts one by one by one, and refuse to give up until you’re finally debt-free. Adopt the mindset that if you can’t afford to pay cash for something, then you can’t afford it. Period. Only then will you free yourself from the chains that bind you. Only then will experience the feeling of owing nothing to anyone and the unexplainable sense of freedom that comes with it.
Once you’ve done what you set out to do, force yourself onto a cash-only diet. Cut up your credit cards if you have to — and learn to pay for everything with the cash you’ve stashed away in your own accounts, not with other people’s money. Know that it may make you feel uncomfortable, and rest assured that it’s supposed to. Paying cash hurts, and it should hurt.
That burn you feel? It’s simply the price you pay for your freedom, and it’s totally worth it. How do you feel about paying cash? Is it painful? Do you think it should be?
On Tuesday evening I gave my first-ever presentation about personal finance. I spoke to a group of about 70 graduating seniors from Western Oregon University. My talk went okay. It wasn’t terrible, but it certainly wasn’t good. It’s a start. I learned a lot, and I’ll do better next time.
I was the fourth and final speaker of the evening, though. Before I talked about personal finance, three WOU alums spoke about life after college. While my talk might have been mediocre, theirs were outstanding.
Brian Reick
The first speaker was Brian Reick, who described his experience moving from job-to-job. He began knocking on doors right out of school and eventually found work. But the job wasn’t perfect, and neither was he. He was fired after only two years. This experience taught him a couple things:
A job is not a marriage. It’s not “for better or worse”. It’s only for better. If it’s not working out for you or the company, then move on.
Treat your time as an investment. It’s more important to invest your time wisely than to invest your money wisely.
Later in his career, Brian found himself working in a job he didn’t like. He made a promise to himself: “I told myself that if I wasn’t happy with my job one year from that day, I’d leave. That was the best decision I ever made. After a year, I knew it was time to go. It was more important for me to be happy than to chase dollars.” Two other life lessons Brian shared were:
The people you work with are more important than the company. You want to work with people who have high integrity, people you can trust. It’s nice to work for a great company, but it’s better to work with great people.
Don’t rationalize your decisions. As you move through your career, don’t stay in situations that make you unhappy just because you think you’re obligated. Take some calculated risks.
Ron Clark
Next we heard from Ron Clark, a Portland lawyer. Ron shared three major points:
What you studied in school does not matter. Students should major in subjects they enjoy. They should pursue learning. One of Ron’s colleagues is a brilliant lawyer who has a degree in music. He knows a judge with a degree in pharmacology. Your degree does not matter.
Self-discipline is the common denominator among the successful. In order to get into college and to earn a degree, one must exercise delayed gratification. This doesn’t end after school. Delayed gratification and self-discipline are necessary for continued success in life.
Be willing to do grunt work. By doing the entry-level jobs, you’re building skills necessary to move up. As you progress in your career, find things in each job to be passionate about.
Celia Kimbrough
The third speaker was Celia Kimbrough, a professional photographer. As a single mother, Celia applied for the interpreting program at Western Oregon University. She was one of 72 applicants for 16 spots. She didn’t get in — she didn’t let it bother her. “I’ve failed at a lot of things in life,” she says, “but they’ve made me who I am today. It’s okay to fail.” The important thing is to be working toward something, to have a goal.
Still, you should always keep your mind open for other options. Don’t be so locked into your goal that you miss opportunity knocking on the door. Sometimes life will lead you in directions you don’t expect. When she didn’t get into the interpreting program, Celia pursued a degree in Natural Sciences. She wanted to be a teacher. But then life led her in another direction, and now she owns a successful photography studio.
“You’ve got to find your passion,” Celia says. “I changed my major six times. That’s okay. Everything you do leads you to the person you’re becoming. As long as you have some goals, you’ll be fine.”
Celia stressed that it’s important to think about the sort of life you want to live. Some of what she said reminded me of Tim Ferriss’ notion of lifestyle design, building your life and career around what you want to do. Entrepreneurship has allowed her to construct a fulfilling life.
“What’s important to you?” she asked asked the students. “Make your choices based on that. I wanted to be excited about what I do every day. If you’re complaining about what you’re doing, then try something else.“
J.D. Roth
To conclude the program, I gave a short presentation on personal finance. Again, this was the first such talk I’ve given, and it was pretty rough. I actually tried to stress some of the topics Get Rich Slowly readers suggested last Monday:
Develop a basic budget. It doesn’t have to be fancy. Whatever you choose to do, make it a goal to set aside 20% for saving and investing. This sounds like a lot, but if you can start the habit young, it’ll be easier. (And will yield greater returns in the long run.)
Avoid lifestyle inflation. As your income increases, it’s tempting to increase your spending in proportion. The more you can resist this urge, the more successful you will be with money.
Do what you love. A low-paying job that leads to future prospects in a career you like is better than a high-paying job in a career that doesn’t move you in the right direction. Never stick with a shitty job. It’s easier to change jobs now than it will be in five or ten years.
The less you spend, the more flexibility you have. When I graduated, I bought a new car and developed credit card debt. I had to take any job I could find because I was tied to monthly payments. When my friend Sparky graduated, he had a lot of freedom. His debts were minimal. He traveled the U.S., taking whatever job struck his fancy. He spent time in Mexico. He spent five months traveling southeast Asia. He was able to do these things because he didn’t have expensive obligations.
With my speech, I handed out a one-page guide to personal finance, which contained supplementary material.
Conclusion
I felt pretty geeky during this dinner. When the first speaker began, I pulled out my pad of paper and started jotting notes. I couldn’t help it. Though these talks were ostensibly aimed at the graduating seniors, there was plenty of valuable information in them for anyone.
I was surprised and happy to discover that one theme seemed to shine through in all four presentations. Money’s a great tool, each of us said, but it’s not the only thing in life. It’s not even the most important thing. We each in our own way stressed one point above all: It’s more important to be happy than it is to be rich.
The information provided on this website does not, and is not intended to, act as legal, financial or credit advice. See Lexington Law’s editorial disclosure for more information.
FICO® scores are numbers measuring creditworthiness using a specific scoring system created by the Fair Isaac Corporation (FICO®). Your credit score, on the other hand, can use any scoring model to generate a number measuring your creditworthiness.
Your credit score is a personally assigned number generated by any credit scoring model that measures your creditworthiness. Lenders and creditors use this score to determine whether they can approve you for loans and credit, and if so, at what interest rates. A higher score means you’re seen as a more reliable borrower, and you’ll likely get better offers from lenders.
People often use the terms “credit score” and “FICO score” interchangeably. In reality, a FICO score is only one kind of credit score. Keep reading for a complete rundown of the differences between a FICO® score and a credit score.
What is a FICO score?
A FICO score is a type of credit score generated by the credit scoring system developed by the Fair Isaac Corporation (FICO). The FICO score was created in 1989 and is one of the most commonly used credit scoring systems for lenders today. According to FICO, 90 percent of all top lenders use FICO scores.
FICO scores can range anywhere from 300 to 850. There are multiple versions of FICO scores, but the newest is the FICO Score 10 model. FICO releases new credit scoring models every few years to adapt to changes in the marketplace. For example, one of the main updates seen in the FICO 10 model is that debt from the most recent 24 months is more heavily weighted than other debt.
Your credit score is critical as it can dictate what types of financial products you’re approved for (mortgages, credit cards, personal loans, car loans) and the terms and interest rates on these products. In fact, your credit score can even reach beyond your finances, as it can be collected by employers and landlords reviewing applicants.
Industry-specific FICO scores
In addition to the standard FICO models, there are industry-specific FICO scores, such as the FICO Auto Score and the FICO Bankcard Score. These industry-specific scores are made for select types of credit such as cars, mortgages, and credit cards. While standard FICO scores range from 300 to 850, industry-specific scores range from 250 to 900.
Overall, FICO industry-specific scores aren’t used as frequently as the standard model.
How is a FICO score calculated?
Your FICO score is made up of the following five factors, all of which are weighted differently:
35 percent: Payment history
30 percent: Amounts owed
15 percent: Length of credit history
10 percent: New credit
10 percent: Credit mix
FICO receives this consumer information from the three major credit bureaus (Equifax, Experian and TransUnion). And those credit bureaus receive consumer data directly from lenders and creditors, which tend to report the information monthly.
What is a good FICO score?
Generally speaking, anything above 670 is seen as a good credit score. However, this will vary from lender to lender.
The FICO model groups people’s scores into these categories:
Exceptional: 800+
Very good: 740 – 799
Good: 670 – 739
Fair: 580 – 669
Poor: 579 and below
An exceptional score means you’ll likely get quickly approved for everything (or almost everything) you apply for, you’ll receive the best terms and you’ll secure the lowest interest rates. In comparison, a poor score will usually lead to application denials, and when you are approved, it’ll be with high interest rates and poor loan terms.
How to get your FICO score
You can get your FICO score directly from FICO or from one of its partners.
Check the FICO Open Access Program: FICO has partnered with a number of institutions to provide your FICO score number for free under its open access program. Check to see if your bank or credit and financial counseling program is listed.
Purchase access from FICO: You can purchase your score and other services from FICO.
Purchase from an authorized FICO retailer: FICO authorized retailers are Experian and Equifax.
When you receive your score from any provider online, make sure to confirm which scoring model was used. Most lenders do use FICO scores when making lending decisions, but it’s still helpful to understand the other scoring models—like VantageScore.
FICO score vs. VantageScore®
The two dominant credit scoring models are the FICO score and VantageScore. VantageScore was created in 2006 by the three major credit bureaus. While VantageScore is less popular overall, it’s gaining more market share every year.
The VantageScore and FICO score models are very similar—they both range from 300 to 850 and release new versions of their scoring model every few years. Still, there are some critical differences between the two models. For example, FICO requires a consumer to have an account open for at least six months before a score can be given, while VantageScore assigns a score as soon as an account appears on your credit report.
Additionally, how VantageScore values various aspects of your credit data differs from FICO. VantageScore assigns the highest weight to credit usage, credit mix and payment history and the lowest weight to new accounts and credit history age.
As a result of these differences, your VantageScore and FICO score can differ. Unfortunately, even if you score higher with one model, you won’t usually be able to use this knowledge to your advantage. You often won’t know if a lender will pull a FICO score or a VantageScore.
Other kinds of credit scores
There are many other credit scores generated and used by other lenders and companies. Common ones are educational credit scores and business credit scores.
An educational credit score is based on a private lender or credit bureau’s ranking of your financial information.
For example, the PLUS score was designed by Experian to provide you with a basic idea of your risk level and creditworthiness. Although they’re designed to measure credit risk, educational credit scores aren’t used by lenders.
Models like the PLUS score are meant for consumer use only, which means they’re not considered when lenders review your loan application.
Business credit scores predict your company’s financial stability and how reliable you are in terms of managing company finances.
For example, Dun & Bradstreet’s D-U-N-S Number is used to identify your business and is the key to finance-related information about your company, like your business credit report, your D&B Delinquency Predictor Score and more.
All your credit scores will likely differ since numerous scoring models are used and these models weigh information differently. They may also pull information from one, two, or all three of the credit bureaus.
Instead of focusing on the specific criteria for each score, you should instead focus on responsibly managing your credit with FICO’s criteria as a guideline, since that score is most commonly used.
How to improve your FICO score
The good news is that if you’re unsatisfied with your FICO score, you can take steps to improve it. By understanding the five factors that make up your credit score, you can also determine what you can potentially do to increase your score. You can usually improve your FICO score by:
Paying down your debts
Paying your bills on time
Keeping your credit utilization low
Only opening new accounts when necessary
Avoiding too many hard inquiries
Keeping your oldest accounts open
It’s also important to check your credit reports frequently. Your credit reports can give you a better understanding of what’s dragging your score down, and you’ll want to make sure that your credit reports don’t contain any inaccurate or false information that’s unfairly affecting your score. If that’s the case, Lexington Law Firm can help you address the errors to get the accurate credit report you deserve.
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Paola Bergauer
Associate Attorney
Paola Bergauer was born in San Jose, California then moved with her family to Hawaii and later Arizona.
In 2012 she earned a Bachelor’s degree in both Psychology and Political Science. In 2014 she graduated from Arizona Summit Law School earning her Juris Doctor. During law school, she had the opportunity to participate in externships where she was able to assist in the representation of clients who were pleading asylum in front of Immigration Court. Paola was also a senior staff editor in her law school’s Law Review. Prior to joining Lexington Law, Paola has worked in Immigration, Criminal Defense, and Personal Injury. Paola is licensed to practice in Arizona and is an Associate Attorney in the Phoenix office.
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Wills are an essential part of estate planning, leaving instructions for how to distribute your assets and possessions after you die. Trusts are a common tool in estate planning as well, serving as a way to manage assets both before and after your death. If your will conflicts with a trust that you have set up, the trust will typically prevail. This is because, in most cases, the assets in a trust don’t technically belong to your estate any longer. They are legally owned by the trust itself, so the terms of your will don’t affect them. For help with estate planning, consider working with a financial advisor.
Will Definition
A last will and testament is a legal document that directs how to distribute your assets after your death. Among other issues, a will establishes:
Who will take possession of your cash, investments, belongings and other property
How to pay any remaining debts or obligations
Any long term or ongoing plans that you would like to make
The care and distribution of any real estate you own
Wills are an essential part of estate planning. When you die, everything that you own is collectively known as your estate, which then gets distributed among your heirs.
If you leave a will, your estate is distributed according to your wishes and that process is overseen by someone you select, known as the executor. If you die without a will, known as dying intestate, your estate is distributed according to the inheritance law of your jurisdiction. That process is overseen by someone appointed by the probate court, known as an administrator.
Under typical circumstances a will is managed through and by probate courts. Your executor will file your will with the court which in turn oversees the entire process of settling your affairs and distributing the estate’s assets. For most estates, the probate process is largely a formality. The court makes sure that your will is legal, that your estate pays its debts and that your executor has the access they need to distribute your assets.
The same process occurs if you die without a will. In that case, the probate court appoints an administrator and the court then ensures that the administrator distributes your assets according to the local inheritance laws.
Trust Definition
A trust is a legal entity created to hold, manage and oversee property. Every trust has four main components:
Contributor – The person who created the trust and contributed assets to it
Assets – The cash, property and other assets owned by the trust
Trustee – The individual or firm that manages the trust’s assets
Beneficiary – The person or persons who receive assets from the trust
When you create a trust, you put assets in its name. Once you do that the assets belong to the trust itself, not you. This is the same as with any other property transfer. The trust is a legal entity capable of owning assets, paying taxes and making distributions, so once you put something in its name that property legally belongs to the trust itself, not you.
In creating a trust, you also establish its terms. You name the trustees and the beneficiaries, and set out the terms for how the trustees should manage the trust and its assets. This includes instructions for what assets the beneficiaries will receive, along with how and when. For instance, you can leave instructions for your trustee to distribute your funds equally among your children after you die.
Can a Will Override a Trust?
There are two main circumstances in which a will can conflict with a trust. First, a will might give instructions that conflict with the terms of a trust that already exists. For example, your will might include language that leaves the family home to your children, while earlier in life you placed that house in a trust for tax purposes. Second, a will might give instructions that conflict with the terms of a trust that doesn’t exist yet, or which hasn’t yet received its assets. For example, your will might include language that distributes your investments among your children, while another section of the will might include language that places your investments in a family trust.
In the first case, the terms of the will have no authority. A will cannot override a trust that already exists, nor can it distribute or manage property already held in an existing trust. If a trust exists and holds its assets, those assets belong to the trust itself. They are not part of your estate and, as a result, are not subject to the terms of your will.
If your will gives instructions that conflict with the terms of a trust, your will’s terms will apply to the assets in your estate and the trust’s instructions will apply to the assets in the trust. The designated beneficiaries will receive their assets according to the terms of the trust.
In the second case, your will is not actually conflicting with any existing trust. Instead, it is internally contradictory and will be resolved according to local inheritance law. You can leave instructions in your will to put assets in trust. This can apply to a trust that already exists, where your will puts assets into a trust that you created earlier. It can also apply to a testamentary trust, where your will instructs the executor to create a new trust and put assets into it.
In both cases, these assets belong to your estate when you die. This means that the terms of your will govern how those assets are distributed. If one section of your will conflicts with the section of your will which creates or contributes to the trust, then the issue is that your will is internally contradictory. The trust itself is not in question, just the will.
In that case the probate court and your executor will have to determine the exact nature of the internal conflict in your will. They will then resolve that conflict according to state and local inheritance law.
Your will still cannot supersede how an existing trust manages its assets. But conflicts in your will can prevent new assets from being added to the trust. This is why, if you plan on making or managing a trust, it’s wise to have a lawyer help you write these documents.
When Should You Use a Will vs. a Trust?
Wills and trusts are, generally, the two most significant vehicles for estate planning. Broadly speaking, if you are looking to leave assets to your heirs, you will likely use one or both of these. While a full exploration of the subject is beyond the scope of this article, there are some good rules for when you should use a will vs. a trust. Wills and trusts are not mutually exclusive; their control over specific property is. Any given asset can either be put in trust or distributed by a will – but not both. However, you can manage your estate in general by putting some assets into a trust and distributing others through a will.
Wills – Good for mid-sized estates, simple transfers and instructions
In general, wills have the benefit of simplicity.
While wills do not have the tax and probate benefits of a trust, the truth is that these concerns are frequently overstated. The federal estate tax only applies to large estates, beginning at $12.92 million at time of writing. And the probate process can take some time, but it typically is only lengthy and complex for particularly large or contentious estates. If you have an ordinary scope of assets, the odds are good that neither taxes nor probate will be a burden for your heirs.
Yet, at the same time, wills are one-shot instruments. This makes good for making simple distributions and leaving direct instructions. But once the terms of the will have been carried out, the estate is closed.
The result is that wills are often a good choice when you want to leave someone an asset in its entirety, such as leaving an amount of cash or a home to one single heir. They are also good for small and mid-sized estates, as a trust would impose additional costs and complications in order to solve tax and probate issues that these estates likely will not have. Finally, wills are good for leaving instructions beyond the scope of assets, such as arranging for the care of minor children and pets.
Trusts – Good for larger estates, ongoing wishes and contestation
In general, trusts have the benefit of third-party management.
When you put money into a trust you legally hand it over to a third party. This creates costs and complications that a will does not have. The trust will require instructions and terms, and you will need to pay for a trustee to oversee the trust’s assets.
This same process, however, means that your estate moves out of your name. You can do this before death, through a living trust, after death, through a testamentary trust, or in totality, through what is known as a pour-over will. This last is a will which bequeaths all of your property to a trust, so there is no risk of accidentally leaving any assets to the probate process.
Moving assets out of your name makes trusts good for estates that are large enough to trigger tax and probate concerns, such as if your estate is worth more than $13 million at time of writing. They are also good for people who want to leave ongoing instructions after they die, for example, if you would like to ensure that a piece of property remains in the family without being sold. Finally, trusts are good for people who anticipate contested issues, as the trust will avoid the probate process that opens the door for heirs and debtors to challenge the estate.
When you’re trying to decide whether to leave assets in a will or a trust, a good rule of thumb is this:
Wills are a good choice when you have a simple transfer to make. If you want to leave someone money or property to own outright, and you are not a multimillionaire, a will may be your best option. Trusts are a good choice when you have a large or complex issue of inheritance. If your estate is worth several million dollars, or you want to ensure that your assets are transferred and managed in a specific way, a trust may be your best option.
Bottom Line
A will cannot override the terms of an existing trust. Once assets belong to a trust, they are not part of your estate and your will has no authority over them. However, if your will has terms to put assets into a trust, internal contradictions can prevent that transfer from taking place.
Estate Planning Tips
Depending on your estate and your wishes, writing your will can be a complicated process. Make sure you take the time to educate yourself about the intricacies of the process before you get started.
A financial advisor can help you with estate planning. Finding a financial advisor doesn’t need to be hard. SmartAsset’s free tool matches you with up to three vetted financial advisors in your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
Eric Reed
Eric Reed is a freelance journalist who specializes in economics, policy and global issues, with substantial coverage of finance and personal finance. He has contributed to outlets including The Street, CNBC, Glassdoor and Consumer Reports. Eric’s work focuses on the human impact of abstract issues, emphasizing analytical journalism that helps readers more fully understand their world and their money. He has reported from more than a dozen countries, with datelines that include Sao Paolo, Brazil; Phnom Penh, Cambodia; and Athens, Greece. A former attorney, before becoming a journalist Eric worked in securities litigation and white collar criminal defense with a pro bono specialty in human trafficking issues. He graduated from the University of Michigan Law School and can be found any given Saturday in the fall cheering on his Wolverines.