This week’s most hotly anticipated report–monthly core PCE inflation–came in 0.2% versus a median forecast of 0.3% this morning. That’s welcome news for a bond market that’s been concerned about surprisingly high inflation numbers in Q1, but not a wholly resounding victory considering the unrounded number (.249%) was as high as it could have been without being rounded up to 0.3%. Fortunately, other components of the report also leaned toward the bond-friendly side of the argument. Cap it all off with an exceptionally weak Chicago PMI and bonds are starting the day with a move back into last week’s 4.34-4.50 range.
Homebuyers are looking for ways to lower their costs as high mortgage rates persist. (iStock)
Mortgage rates pushed further into the 7% range as the Federal Reserve seems unlikely to reverse its restrictive policy stance anytime soon, according to Freddie Mac.
The average 30-year fixed-rate mortgage was 7.22% for the week ending May 2, according to Freddie Mac’s latest Primary Mortgage Market Survey. That’s an increase from the previous week when it averaged 7.17%. A year ago, the 30-year fixed-rate mortgage averaged 6.39%.
The average rate for a 15-year mortgage was 6.47%, up from 6.44% last week and up from 5.76% last year.
On Wednesday, the Fed announced it would maintain the federal funds rate at 5.25% to 5.5%, where rates have held steady since last July. Fed officials have said in past meetings that they anticipated rate cuts for 2024 but need more confidence that inflation is heading toward the 2% target rate. Fed Chair Jerome Powell reiterated this sentiment on Wednesday and said it would likely take longer for the central bank to gain this confidence when speaking with reporters.
The delay in rate cuts means mortgage rates will likely stay high longer. With no ease in sight, affordability will continue to be a challenge for homebuyers, who also contend with high home prices.
“The 30-year fixed-rate mortgage increased for the fifth consecutive week as we enter the heart of Spring Homebuying Season,” Freddie Mac’s Chief Economist Sam Khater said. “On average, more than one-third of home sales for the entire year occur between March and June. With two months left of this historically busy period, potential homebuyers will likely not see relief from rising rates anytime soon.”
If you are ready to shop for the best rate on a new mortgage, consider visiting an online marketplace like Credible to compare rates and get preapproved with multiple lenders at once.
BUY A HOME IN THESE STATES TO GET STUDENT LOAN DEBT RELIEF
How higher rates are impacting housing
Homebuyers are looking for ways to lower their costs as high mortgage rates persist. Recently, there have been an increase in proptech solutions, down payment assistance and even rate buydowns, Percy.AI Founder and CEO Charles Williams said.
“Homebuyers are looking to use whatever incentives they can score,” Williams said. “We expect some of these initiatives to remain even after rates start heading down meaningfully, which is unlikely this year.”
Buyers have also increasingly turned to adjustable-rate mortgages (ARMs) for a discount. Compared to more traditional mortgage products, ARMs offer lower initial interest rates before adjusting to higher rates in the future.
“With affordability remaining a challenge, more prospective buyers are turning to adjustable-rate mortgages to lower their monthly payments in the short-term,” Bob Broeksmit, the Mortgage Bankers Association president and CEO, said. “The ARM share of applications last week reached 7.8% – the highest level this year.”
If you’re looking to become a homeowner, you could still find the best mortgage rates by shopping around. Visit Credible to compare your options without affecting your credit score.
HOMEOWNERS COULD SAVE TENS OF THOUSANDS IN DAMAGES BY USING SMART DEVICES
Home prices increase
Buyers waiting for relief from high home prices will have to wait longer. Home prices are now 6.4% above their level last year, up from the 6% increase registered in January, according to the latest S&P CoreLogic Case-Shiller national home price index report.
Fannie Mae readjusted its home price projection and forecasts upward, forecasting prices to increase 4.8% annually in 2024 and 1.5% in 2025.
“Buyers are mainly waiting to see if prices go down, too, to balance things out,” Williams said. “That is not likely to happen soon. So, buyers who can afford a home are buying, but only if they can outcompete in this crazy market.”
One way to use your home’s equity is through a cash-out refinance to help you pay down debt or fund home improvement projects. Visit Credible to find your personalized interest rate without affecting your credit score.
THIS IS THE #1 CITY FOR FIRST-TIME HOMEBUYERS, AND OTHER HOT US HOUSING MARKETS
Have a finance-related question, but don’t know who to ask? Email The Credible Money Expert at [email protected] and your question might be answered by Credible in our Money Expert column.
Ginnie Mae, which manages the government-guaranteed portfolio of forward and reverse mortgage-backed securities (MBS), announced this week at a National Reverse Mortgage Lenders Association (NRMLA) event that it will release initial details of its forthcoming Home Equity Conversion Mortgage-backed Securities (HMBS) product as soon as next month.
RMD submitted a request for comment to Ginnie Mae shortly thereafter, and on Friday received a response from Sam Valverde, the company’s acting president and the speaker at the NRMLA event.
When asked to offer additional details about the product that industry participants refer to as “HMBS 2.0,” Valverde reiterated the company’s commitment to the reverse mortgage market in light of recent liquidity challenges and its management of the portfolio of a former lender.
“Ginnie Mae remains committed to stabilizing the government reverse mortgage market,” Valverde told RMD. “Our development of a new HMBS program is intended to ease liquidity pressures and help ensure that our Issuers have access to reliable and cost-effective capital markets funding.”
At the NRMLA event, Valverde revealed that the company is developing policy and implementation plans for the impending product, with plans to roll out a term sheet that will include a 30-day public comment period that is expected soon. He added that he expects the product will launch by the end of this year, but said it could potentially come sooner.
Ginnie Mae has been in active communication with the reverse mortgage industry on HMBS issues and associated liquidity concerns since it became more heavily involved in 2022. Valverde added that the company is aiming to continue that posture as HMBS 2.0 develops further.
“We look forward to hearing from the industry and key stakeholders on the term sheet that we will release next month,” he said. “Timing of program implementation will depend on feedback we receive, but Ginnie Mae will continue to prioritize [the] development [of] this program.”
HMBS 2.0 has a lot of eyes on it, both inside and outside of the reverse mortgage industry. In a recent letter to Ginnie Mae over its handling of the issuer status of a bankrupt lender, Sen. Mike Braun (R-Ind.) sought extensive information on the development of HMBS 2.0.
These included details like the analyses that suggested the need for a new product in the space; the associated goals, risks and expected outcomes that could stem from such a product; how it would impact loans already being serviced by the Federal Housing Administration and Ginnie Mae; and the costs associated with establishing it.
The product was even mentioned in a recent investor update by Finance of America (FOA), which suggested that HMBS 2.0 would be able to benefit the company.
“HMBS 2.0 may allow FOA to collapse ~$630 million of securitized buyout [unpaid principal balance (UPB)] and reissue these as [Ginnie Mae] securitizations, improving liquidity and freeing operating capital,” the company said.
Ginnie Mae announced the development of the product in January. It will enable the acquisition of loans from an HMBS pool above the existing 98% maximum claim amount (MCA) requirement, according to an initial announcement.
Now that grocery inflation seems to have eased, retailers are clamoring to offer more and better discounts that will get shoppers back to their stores this summer. With an announcement Wednesday, Walgreens joined a growing list of national brands, which also includes Target and Amazon Fresh, that are touting price cuts on an array of goods from everyday staples to seasonal favorites.
After years of rising prices, it’s a welcome change. Grocery prices are 25% higher than they were at the start of 2020, according to the latest consumer price index, but they actually fell slightly in April from the previous month.
Shoppers have persevered through these years of high prices by switching retailers, brands or other qualities of the food they buy, says Joe Balagtas, a professor of agriculture economics and interim director of the Center for Food Demand Analysis and Sustainability at Purdue University. Now, with grocery prices generally falling, retailers are seizing an opportunity to woo back customers.
“We find other ways to economize to the extent that it dips into retailers’ profits,” Balagtas says. “I think that could drive them to find ways to cut prices to make sure they’re drawing in budget-conscious consumers.”
Considering how much Americans typically spend on food — about 11% of their income in 2022, according to the Agriculture Department — lower prices are going to be felt by shoppers, Balagtas says. “They don’t even have to fall. Just slower inflation is going to alleviate some stress for a lot of people.”
Find summer sales at these retailers
Here’s where shoppers can find deals on food and pharmacy items.
Aldi
Aldi, which has benefited from shoppers’ pivot away from pricier grocery stores, will reduce prices on more than 250 items through Labor Day. Aldi estimates its price cuts will save shoppers $100 million. The retailer did something similar last year, estimating its 2023 price cuts saved shoppers more than $60 million.
Park Street Deli: Pulled Pork/Pulled Chicken – $6.99 (was $7.49).
Amazon Fresh
Amazon Fresh is cutting prices online and in-store on roughly 4,000 items, which will rotate weekly, according to CNN. Shoppers can expect to see discounts of up to 30% on meat, seafood, frozen food, dairy and cheese, beverages, snacks and pasta.
Target
Target will mark down prices on about 5,000 items. Those price cuts are set to take place throughout the summer, and are targeting daily essentials, like milk, meat, bread, fresh fruit and vegetables, snacks, yogurt, peanut butter, coffee, diapers, paper towels and pet food, among other items.
In addition to price cuts, Target touted changes to its free Target Circle membership, which now applies deals automatically at the register. The retailer also is pursuing discount shoppers with a new store brand called Dealworthy, which launched in February. Most Dealworthy products are priced at $10 or less.
Walgreens
In a May 29 announcement, Walgreens called attention to an ongoing effort to cut prices on 1,300 items that dates back to October 2023.
Prices will vary by location. Examples of items with lower prices include:
One a Day 80 ct Men’s and Women’s Gummy Vitamins – $11.99 (was $13.49).
Always Pad Mod Regular (20 ct) – $6.99 (was $7.49).
Walmart has upped its “rollback” game lately, as well. In a May 2024 earnings call, executives said it temporarily cut prices on 45% more grocery items in April compared with the previous year. Across the store, prices have been reduced on nearly 7,000 items.
In April, Walmart introduced the new BetterGoods brand, which is aimed at price-conscious shoppers with foodie tendencies. It includes 300 grocery items that either touch on a food trend or fit into popular dietary preferences, including plant-based, gluten-free and artificial flavor-free foods. Walmart says BetterGoods items cost $15 or less, with most items priced around $5 or less.
The non-QM market remains a “choppy” environment – but lenders equipped with the tools to withstand that turbulence will be well positioned moving ahead, according to the chief executive officer of a prominent lender in the space. Keith Lind (pictured top), of Acra Lending, told Mortgage Professional America that the company had navigated those hurdles … [Read more…]
For homebuyers struggling to afford a home amid stubbornly high mortgage rates and surging prices, there’s a little-known workaround that can help turn back the clock to the days of ultra-low monthly mortgage payments. But it comes with a few caveats.
Assumable mortgages are loans that allow a homebuyer to take over a seller’s existing mortgage. This means that a buyer keeps the seller’s repayment period, mortgage balance and, notably, the seller’s lower mortgage rate. Some experts point to this type of loan as a potential way of reviving the struggling housing market.
“It’s a really great program for today’s market,” said Ted Tozer, the former president of Ginnie Mae — a government-owned corporation within the Department of Housing and Urban Development — and a non-resident fellow at the Urban Institute.
About 12.2 million US mortgages are assumable, according to data from Intercontinental Exchange. That amounts to 23% of all US mortgages.
But while assumable loans could benefit both sides of a homebuying transaction, there are some drawbacks, including a longer approval process, Tozer said.
“The sellers should be able to get an extra 1% or 2% for their home to compensate them for the value they are transferring,” he said. “The buyers’ advantage is that they can have a lower mortgage payment over the life of the loan than they would have gotten with a new mortgage.”
A little-used benefit of government loans
Ellen Harper, a software analyst in her mid-50s, closed on a Fairburn, Georgia, home with a 2.49% mortgage rate in April after first learning about assumable mortgages in the fall.
Securing that ultra-low mortgage rate means that Harper will save thousands of dollars in monthly payments. In mid-April, the 30-year fixed-rate mortgage averaged 7.10%, reaching the highest level since November.
“I just decided I wanted to see how low I could pay on the interest rate,” Harper said. “I went into it looking for the best deal I could get, and I think I did pretty good.”
Not all home loans can be passed to a homebuyer, but most government-backed loans, such as those from the Federal Housing Administration and the US Department of Veterans Affairs, are assumable.
The number of FHA-backed loans assumed grew 111% between 2021 and 2023, while the number of VA-backed loans assumed grew 713% in that same time period, according to government data provided to CNN.
Still, in the American real estate market, mortgage assumptions are relatively rare. There have been just 2,973 FHA-backed mortgage assumptions so far this year, according to the agency.
How does an assumable mortgage work?
The process of assuming an existing mortgage is a bit different from getting approved for a new home loan.
For example, suppose a seller with an assumable loan chooses to list their home at $500,000 and their current mortgage balance is $300,000. In that case, that home seller currently has $200,000 in equity (the difference between $500,000 and $300,000). To take over that seller’s mortgage, a buyer would have to make a cash payment of $200,000 to the seller to compensate for their equity stake. Then, the buyer would take over the sellers’ existing monthly payments on their mortgage.
For buyers, $200,000 may be a lot of money to pay upfront. Some take out a second mortgage to cover the equity payment, Tozer said. And while the mortgage rate on the second loan may be high, the total monthly payment could still be lower — if the assumed mortgage rate is low enough.
Generally, an assumable loan must be approved by the seller’s lender and the VA, FHA, or other government agency backing the loan. That means not only are there more layers to get through, but a homebuyer must also meet specific credit and income standards before getting approval.
Is there a catch?
Snagging a low mortgage rate like Harper’s in today’s high interest rate environment may seem like a dream come true to some prospective homebuyers, but the process is not always smooth sailing.
Tozer said lenders often delay approving mortgage assumptions because the VA and FHA cap the amount of money the lenders can make processing these applications.
“People have complained that the assumptions are taking substantially long periods of time to close and because of that, sellers are getting frustrated and the Realtors want their money,” Tozer said.
Another potential downside for holders of VA-guaranteed loans: According to the department, passing your mortgage along to a civilian may slow down your ability to get approved for another VA loan.
Even so, assumable mortgages may hold an appeal for homebuyers who missed the boat on lower interest rates. Finding an assumable mortgage with a willing seller may be akin to “unicorn hunting,” said one commenter on social media.
The relative rarity of these mortgages also means some folks may have misconceptions about how they work. For example, Harper said her seller was initially skeptical about her taking over their home loan, erroneously believing he’d be on the hook if Harper missed mortgage payments after taking over the mortgage.
“We put in an offer a couple of times in the beginning and he wasn’t comfortable, so the offer expired without him accepting it,” she said of her homeseller.
Harper used Roam, one of a growing group of real estate start-ups focused on helping buyers find homes that allow mortgage assumptions.
For now, Roam is only available in Georgia, Arizona, Colorado, Texas and Florida, but Roam’s CEO, Raunaq Singh, told CNN he plans to launch nationwide later this year.
Harper said the company helped educate her home’s seller about assumable mortgages, reassuring him that he would no longer be responsible for the loan once it was taken over by Harper.
A home decorating store has opened at the historic Spokane Club, at 1002 W. Riverside in downtown Spokane.
Mad Max Furniture & Decor, located on the club’s third floor and open to the public, offers decorating services, small-furniture painting, home décor goods, and private shopping experiences.
“I wanted to offer something that’s unique for my customers,” says Sara Walter, the store’s owner, who notes that she isn’t employed by the Spokane Club, but rather leases the space.
The space previously held a small coffee bar and at one time had been used as a hotel suite, she says.
Customers can schedule private shopping experiences outside of the store’s regular hours. Walter can order them drinks from the club’s restaurant and bar, she adds.
“I want to offer more personalization,” she says.
Mad Max’s regular hours are 11 a.m.-5 p.m. Tuesday, 10 a.m.-5 p.m. Friday, and 10 a.m.-2 p.m. Saturday.
Walter hasn’t hired any employees, although she says she hopes to hire some eventually and expand the store’s hours once it becomes busier.
The products sold at Mad Max include a variety of home décor goods, such as wall art, books, and kids’ toys. Many of the items sold make for good gifts, Walter says.
“Pretty much everything that I sell is very affordable,” she says.
In addition to helping clients pick out products to decorate their homes, Walter, who calls herself a budget-friendly decorator, also will travel to their homes and handle decorating tasks, from painting to hanging art.
Customers can bring small pieces of furniture for Walter to paint as well. She doesn’t do larger pieces anymore because they take a long time to do properly, she says.
Mad Max also offers find-and-finish services if customers are looking for a particular piece of furniture or an antique, Walter adds.
“I can actually go out and find it, paint it, and deliver it,” she says.
Walter’s hobby-turned-business venture began about 10 years ago, not long after the birth of her first child, Max.
Walter jokingly says she was “going mad” as a stay-at-home mom at the time, so she began painting furniture in her spare time and eventually wound up renting space as a vendor at a local vintage shop, when she created the Mad Max moniker.
Her design and decorating experience at that time involved staging some houses that she and her husband flipped. Walter’s introduction to the industry started when the owner of the local vintage store took notice of a piece of furniture she had painted and asked her if she wanted to sell items at the store.
“I’m super passionate about it, which I think helps,” she says. “I think you can tell when someone is passionate about what they do.”
Her space at the vintage store helped to build a customer base, but when business began slowing down there, she expanded Mad Max.
“I started branching out a little bit, started doing pop-ups,” she says.
Walter held numerous pop-up events at her house, at which she would decorate a space and sell a variety of home décor products. The temporary shops were accompanied by catering and wine, she says.
Walter ended up doing a Christmas-themed pop-up event at the Spokane Club, where she’s a member. The general manager liked what he saw, she says, and asked her if she could help decorate some rooms at the club.
After designing a coworking space, also on the third floor of the club, Walter was offered a space to set up her permanent store.
She had already decided to transition away from of the vintage store she was selling goods out of but had planned to just move Mad Max online.
“And then an opportunity came up here,” she says.
Walter is in the process of creating a website for Mad Max, through which customers will be able to shop the store online.
“It’s been almost 10 years,” Walter says. “It’s come a long way from where I started, just painting furniture.”
Small Bites
*Happy Laundry & Dry Cleaning, of Spokane, has relocated to 3724 E. Front from its previous location at 3027 E. Mission. The move, which comes after months of remodeling work, will make the nearly 20-year-old laundry service company more efficient and enhance its growth capabilities, co-owner Kent Wales says in a press release from the company. Wales also served as the general contractor on the remodel project. Happy Laundry has about 20 employee
The data breach that knocked out First American Financial Corp.’s systems at the end of last year impacted 44,000 individuals, the company revealed.
The title insurer and real estate services provider Tuesday disclosed the scope of the hack for the first time in a Securities and Exchange Commission filing. First American hasn’t defined the hack as a cyberattack, but said its probe was completed and that individual’s personal information may have been accessed without authorization.
The incident, discovered Dec. 21, forced First American’s systems to go offline for a week, a move which led its competitors to pick up its business. First American acknowledged the hack hurt its revenue in its fourth quarter earnings.
The company said it would notify potentially affected clients and offer them complimentary credit monitoring and identity protection services. Tuesday’s announcement was posted underneath a company disclosure regarding election results for its board of directors.
The hack on First American came amid a wave of cyberattacks on mortgage players, including major hits to Mr. Cooper and Loandepot. Both of those giants also said their respective data breaches hurt quarterly earnings.
First American had $46.7 million in net income to begin the year, both a quarterly and annual improvement. Its title revenue however dropped slightly year-over-year to $1.32 billion. Company leaders said the December incident wouldn’t harm business moving forward, and they reported orders rising in March and April.
Cybercriminals are likely to use First American’s infrastructure to “island hop” to other financial services players, said Tom Kellerman, senior vice president of cyberstrategy at Contrast Security. He warned of the threat of home equity fraud, where a criminal could establish a line of credit against someone else’s home.
“Inevitably the owner of the home is the one that’s penalized by the system for not paying their debt,” he said. “And that is increasing. That is my biggest concern regarding this breach.”
Inside: Learn what 23 an hour is how much a year, month, and day. Plus tips to budget your money. Don’t miss the ways to increase your income.
You’re probably wondering if I made $23 a year, how much do I truly make? What will that add up to over the course of the year when working? Is $23 an hour good?
Is this wage something that I can actually live on? Or do I need to find ways that I can increase my hourly wage? How much more is $23.50 an hour annually?
In this post, we’re going to detail exactly what $23 an hour is how much a year. Also, we are going to 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.
By taking a step ahead and making a plan for the money, you are better able to decide how you want to live, make sure that you put your money goals first, and not just living paycheck to paycheck struggling to survive.
The ultimate goal with money success is to be wise with how you spend your money.
If that is something you want too, then keep reading. You are in the right place.
$23 an Hour is How Much a Year?
When we ran all of our numbers to figure out how much $23 per hour is an annual salary, we used the average working day of 40 hours a week.
40 hours x 52 weeks x $23 = $47,840
$47,840 is the gross annual salary with a $23 per hour wage.
As of June 2023, the average hourly wage is $33.58 (source).
Let’s break down how that number is calculated.
Typically, the average work week 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 $23 times 2,080 working hours, and the result is $47,840.
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 $23 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 $23 times 1,040 working hours, and the result is $23,920.
How Much is $23 Per Month?
On average, the monthly amount would average $3,987.
Annual Amount of $47,840 ÷ 12 months = $3,987 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.
Plus by increasing your wage from $22 an hour, you average an extra $2000 per year. So yes, one more dollar an hour makes a huge difference and adds up!
Work Part Time?
Only 20 hours per week. Then, the monthly amount would average $1,993.
How Much is $23 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 $23 = $920 per week.
Work Part Time?
Only 20 hours per week. Then, the weekly amount would be $920.
How Much is $23 per Hour Bi-Weekly
For this calculation, take the average weekly pay of $920 and double it.
$920 per week x 2 = $1,840
Also, the other way to calculate this is:
40 hours x 2 weeks x $23 an hour = $1840
Work Part Time?
Only 20 hours per week. Then, the bi-weekly amount would be $920.
How Much is $23 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 work day.
8 hours x $23 per hour = $184 per day.
If you work 10 hours a day for four days, then you would make $230 per day. (10 hours x $23 per hour)
Work Part Time?
Only 4 hours per day. Then, the daily amount would be $92.
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$23 Per Hour is…
$23 per Hour – Full Time
Total Income
Yearly Salary (52 weeks)
$47,840
Yearly Wage (50 weeks)
$46,000
Monthly Salary (173 hours)
$3,987
Weekly Wage (40 Hours)
$920
Bi-Weekly Salary (80 Hours)
$1,840
Daily Wage (8 Hours)
$184
Net Estimated Monthly Income
$3,044
**These are assumptions based on simple scenarios.
Paid Time Off Earning 23 Dollars an Hour
Does your employer offer paid time off?
As an hourly employee, you may or may 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 $47,840 per year.
This is the same as the example above for an annual salary making $23 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, multiple the hourly salary of $23 times 2,000 working hours, and the result is $46,000.
40 hours x 50 weeks x $23 = $46,000
You would average $184 per working day and nothing when you don’t work.
$23 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.
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: $47,840
Federal Taxes of 12%: $5,741
State Taxes of 4%: $1,914
Social Security and Medicare of 7.65%: $3,660
$23 an Hour per Year after Taxes: $36,526
This would be your net annual salary after taxes.
To turn that back into an hourly wage, the assumption is working 2,080 hours.
$36,526 ÷ 2,080 hours = $17.56 per hour
After estimated taxes and FICA, you are netting $17.56 an hour. That is $5.44 an hour less than what you thought you were paid.
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.
Plus budgeting on a just over $17 an hour wage is much different.
$23 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 $23.01-23.99.
This is super helpful if you make $23.35 or $23.69.
You are probably wondering can I live on my own making 23 dollars an hour? How much rent can you afford at 23 an hour?
Using our Cents Plan Formula, this is the best case scenario on how to budget your $23 per hour paycheck.
When using these percentages, it is best to use net income because taxes must be paid.
In this example, we calculated $23 an hour was $17.56 after taxes. That would average $3,044 per month.
According to the Cents Plan Formula, here is the high level view of a $23 per hour budget:
Basic Expenses of 50% = $1,522
Save Money of 20% = $609
Give Money of 10% = $304
Fun Spending of 20% = $609
Debt of 0% = $0
Obviously, that is not doable for everyone. Even though you would expect your money to go further when you are making double the minimum wage. So, you have to be strategic in ways to decrease your basic expenses and debt. Then, it will allow you more money to save and have fun money.
To further break down an example budget of $23 per hour, then using the ideal household percentages is extremely helpful.
recommended budget percentages based on $23 per hour wage:
Category
Ideal Percentages
Sample Monthly Budget
Giving
10%
$315
Savings
15-25%
$638
Housing
20-30%
$957
Utilities
4-7%
$199
Groceries
5-12%
$319
Clothing
1-4%
$40
Transportation
4-10%
$159
Medical
5-12%
$199
Life Insurance
1%
$16
Education
1-4%
$22
Personal
2-7%
$60
Recreation / Entertainment
3-8%
$120
Debts
0% – Goal
$0
Government Tax (including Income Taxes, Social Security & Medicare)
15-25%
$943
Total Gross Income
$3,987
**In this budget, prioritization was given to basic expenses. Thus, some categories like giving and saving were less.
Can I Live off $23 Per Hour?
At this $23 hourly wage, you are close to double the minimum wage. Things should be easy to live on this $23 hourly salary or just above $47,000 a year.
However, it is still below the median income of over $60,000 salary. That means it can still be a tough situation.
Is it doable? Absolutely.
In fact, $23 an hour is four dollars higher than the median hourly wage of $19.33. That seems backward, but typically salaried workers earn more per hour than hourly workers.
Can you truly live off $23 an hour annually?
You just have to be wiser (or frugal) with your money and how you spend the hard-earned cash you have been blessed with.
If you are constantly struggling to keep up with bills and expenses, then you need to break that constant cycle. It is possible to be smart with money.
You need to do is change your money mindset.
This is what you say to yourself… Okay, this is my season of life right now. I have aspirations and goals to change how much I make, but for now, I am going to make sure that I am able to live on my 23 dollars per hour. No going into debt for me. I will start saving money.
In the next section, we will dig into ways to increase your income, but for now, is it possible to live on $23 an hour?
Yes, you can do it, and as you can see it is possible with the sample budget of $23 per hour.
Living in a higher cost of living area would be more difficult. So, you may have to get a little creative. For example, you might have to have a roommate. Move to a lower cost of living area where rent is cheaper.
Also, you must evaluate your “fun spending” items. Many of those expenses are not mandatory and will break your budget. You can find plenty of free things to do without spending money.
5 Ways to Increase Your Hourly Wage
This right here is the most crucial 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 $23.50 will add up over the year. Even better $24 an hour is awesome!
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 $23 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 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 becoming 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.
Related Question: How Fast Can you Make Money in Stocks? The Real Answer
Tips to Live on $23 an Hour
In this last section, grasp these tips on how to live on $23 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 $23 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 $23 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 take home of $23 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 gross 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. If you’re good, since you must keep your expenses low, you have to find ways to make your savings fun!
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 of 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 we 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 $23 an Hour
You can find jobs that pay $23 per hour. Polish up that resume, cover letter, and 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:
Virtual Assistant – Get free training NOW!
Customer service representatives
Bank tellers
Freelance writers
Restaurant Kitchen staff
Truck driver
Uber /Lyft driver
Security guard
Freight broker
Movers
Warehouse workers
Nannies
Pharmacy Tech
Certified Nursing Assistant
Companies that pay more than $23 per hour:
DHL
U-Haul
Kroger
Costco
Wayfair
Amazon
Best Buy
Target
Wells Fargo
Disney World
Disney Land
Bank of America
JP Morgan
Cigna
Aetna
$23 Per Hour Annual Salary
In this post, we detailed 23 an hour is how much a year. Plus all of the variables that can impact your net income. This is something that you can live off.
How much is 23 dollars an hour annually…
$47,840
This is right between $46000 per year and $48k 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!
Still thinking I don’t want to work anymore, you aren’t alone and need to start to plan for your early retirement.
Learn exactly how much do I make per year…
Know someone else that needs this, too? Then, please share!!
Did the post resonate with you?
More importantly, did I answer the questions you have about this topic? Let me know in the comments if I can help in some other way!
Your comments are not just welcomed; they’re an integral part of our community. Let’s continue the conversation and explore how these ideas align with your journey towards Money Bliss.
If you have a significant amount of money in a bank or brokerage account, you may crave reassurance that your funds would be covered in the rare instance of a financial institution failing. The United States government has a couple of programs in place that help to protect savers and investors in the case of a bank failure. These programs help to ensure overall consumer confidence in the U.S. financial sector.
Two of these programs are run by government corporations known as the FDIC and SIPC. The Federal Deposit Insurance Corporation (FDIC) protects money that is held in a checking, savings, certificate of deposit (CD), or other deposit account at an insured bank. The Securities Investor Protection Corporation (SIPC) protects customers of SIPC-member broker-dealers if the firm fails financially.
While these two insurance programs have a lot of similarities, they also have a few key differences that you’ll want to be aware of.
What Is FDIC?
The Federal Deposit Insurance Corporation (FDIC) is an independent agency that was created by an act of Congress passed in 1933. During the Great Depression of the 1930s, many local and regional banks failed. Congress created the FDIC to help ensure that people would not lose their hard-earned money in the case of future bank failures.
The FDIC insures $250,000 per depositor, per insured bank, for each account category (such as single, trust, or joint accounts). Since FDIC insurance first went into effect in 1934, no depositor has lost any insured money that was held in an eligible bank.
While the FDIC offers insurance for deposits held at participating banks, the National Credit Union Administration (NCUA) insures deposits held at credit unions. It’s important to understand that key difference between the FDIC and NCUA.
Also worth noting is that some financial institutions offer programs which can insure excess deposits for more than the $250,000 limit with extended insurance coverage.1 This is typically accomplished by bank partnerships which ensure that no single financial institution holds more than the $250,000 FDIC limit for a client.
If you want to keep more than $250,000 on deposit, it can be worthwhile to look into these expanded FDIC insurance coverage offers.
What Is SIPC?
In addition to the FDIC and the NCUA, the SIPC is a nonprofit organization that is set up to protect U.S. consumers. The Securities Investor Protection Corporation (SIPC) was started when Congress passed the Securities Investor Protection Act of 1970. The SIPC protects the securities and cash in a brokerage account, up to a total amount of $500,000.
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SIPC vs FDIC
When comparing the SIPC to the. FDIC, you will learn that they are two different organizations. They share the goal of protecting accounts held in U.S. financial institutions and instilling consumer confidence.
Here’s a look at how the SIPC and FDIC are similar and different:
Securities Investor Protection Corporation (SIPC)
Federal Deposit Insurance Corporation (FDIC)
Protects money invested in brokerage accounts
Protects money invested in bank accounts
Protects the securities and cash in your brokerage account up to $500,000
Protects up to $250,000 per depositor, per ownership category, per bank
Founded in 1970
Founded in 1934
Applies if a brokerage firm becomes insolvent and/or goes bankrupt
Applies when a bank fails
Similarities
The SIPC and FDIC share the same goal — ensuring that money and investments held in U.S. accounts remain in the hands of consumers. One isn’t necessarily better than the other, since they apply to different kinds of financial holdings. No matter where you are holding your money and/or investments, you’ll want to make sure that your investments are insured by either the FDIC, NCUA, or SIPC.
Differences
The biggest difference between the FDIC and the SIPC is when they apply. The FDIC covers deposits held at certain banks. The SIPC applies to investments at brokerage accounts.
Another difference is the amount of coverage. The FDIC protects up to $250,000 in a bank account, while the SIPC covers up to $500,000 in a brokerage account, including up to $250,000 protection for cash in your brokerage account.
Pros and Cons of FDIC vs SIPC
There aren’t really pros and cons when comparing the insurance offered by the FDIC and SIPC. It’s not a matter of, say, SIPC insurance vs. FDIC: They are not competitors. Each organization works in a slightly different way.
In terms of upsides, the FDIC covers deposits held by FDIC-insured banks. That means if you have money in a checking, savings, CD, or other kind of depositor account, held at an insured bank, you would be covered against loss in the very rare instance of the bank failing. The downside, if you want to look at it that way, is that this insurance doesn’t extend to brokerage accounts.
The SIPC covers the value of investments held in a brokerage account. As for positives, the reassurance of knowing your funds are covered is an excellent feature. However, the downsides could be seen as the limits of this coverage: up to $500,000 and only for funds held per SIPC guidelines.
Because they work in different ways, the FDIC and SIPC complement each other to work towards strengthening consumer confidence.
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Is Your Bank Account Insured?
No matter where you keep your money, you’ll want to make sure that the money in your account is insured by a program such as the FDIC or SIPC. Being insured by the FDIC is a component that can be used to rate banks against each other.
It is usually fairly straightforward to find out if your bank is insured by the FDIC. To find out if your bank is FDIC-insured, go to the BankFind Suite on the FDIC website.
It may be more complicated to find out if your brokerage account is held in an account covered by the SIPC. If you cannot find the answer on the broker’s website, contact them to make sure.
Opening a SoFi Savings Account
Are you looking for a new home for your money? See what a SoFi Checking and Savings account can offer.
Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.
Better banking is here with SoFi, NerdWallet’s 2024 winner for Best Checking Account Overall.* Enjoy up to 4.60% APY on SoFi Checking and Savings.
FAQ
Is SIPC as good as FDIC?
The Securities Investor Protection Corporation (SIPC) and Federal Deposit Insurance Corporation (FDIC) are not direct competitors. They insure investments and deposits at brokerage firms and banks, respectively.
Is it safe to keep more than $500,000 in a brokerage account?
Whether it’s safe to keep that much money in a brokerage account depends on your individual risk tolerance. Just keep in mind that the SIPC will only cover up to $500,000 in a brokerage account, which includes $250,000 in cash in your brokerage account.
What does SIPC not cover?
The SIPC covers what it defines as “securities” — stocks, bonds, Treasury securities, certificates of deposit, mutual funds, money market mutual funds, and certain other investments. SIPC does not protect most commodity futures contracts, foreign exchange trades, investment contracts and fixed annuity contracts that are not registered with the U.S. Securities and Exchange Commission under the Securities Act of 1933.
Photo credit: iStock/AlexSecret
1SoFi Bank is a member FDIC and does not provide more than $250,000 of FDIC insurance per legal category of account ownership, as described in the FDIC’s regulations. Any additional FDIC insurance is provided by banks in the SoFi Insured Deposit Program. Deposits may be insured up to $2M through participation in the program. See full terms at SoFi.com/banking/fdic/terms. See list of participating banks at SoFi.com/banking/fdic/receivingbanks.
The SoFi Bank Debit Mastercard® is issued by SoFi Bank, N.A., pursuant to license by Mastercard International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.
SoFi members with direct deposit activity can earn 4.60% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. Direct Deposit means a recurring deposit of regular income to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government benefit payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Direct Deposit”) via the Automated Clearing House (“ACH”) Network during a 30-day Evaluation Period (as defined below). Deposits that are not from an employer or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, or are non-recurring in nature (e.g., IRS tax refunds), do not constitute Direct Deposit activity. There is no minimum Direct Deposit amount required to qualify for the stated interest rate.
As an alternative to direct deposit, SoFi members with Qualifying Deposits can earn 4.60% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Qualifying Deposits means one or more deposits that, in the aggregate, are equal to or greater than $5,000 to an account holder’s SoFi Checking and Savings account (“Qualifying Deposits”) during a 30-day Evaluation Period (as defined below). Qualifying Deposits only include those deposits from the following eligible sources: (i) ACH transfers, (ii) inbound wire transfers, (iii) peer-to-peer transfers (i.e., external transfers from PayPal, Venmo, etc. and internal peer-to-peer transfers from a SoFi account belonging to another account holder), (iv) check deposits, (v) instant funding to your SoFi Bank Debit Card, (vi) push payments to your SoFi Bank Debit Card, and (vii) cash deposits. Qualifying Deposits do not include: (i) transfers between an account holder’s Checking account, Savings account, and/or Vaults; (ii) interest payments; (iii) bonuses issued by SoFi Bank or its affiliates; or (iv) credits, reversals, and refunds from SoFi Bank, N.A. (“SoFi Bank”) or from a merchant.
SoFi Bank shall, in its sole discretion, assess each account holder’s Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving a Direct Deposit or $5,000 in Qualifying Deposits to your account, you will begin earning 4.60% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.
SoFi Bank reserves the right to grant a grace period to account holders following a change in Direct Deposit activity or Qualifying Deposits activity before adjusting rates. If SoFi Bank grants you a grace period, the dates for such grace period will be reflected on the APY Details page of your account. If SoFi Bank determines that you did not have Direct Deposit activity or $5,000 in Qualifying Deposits during the current 30-day Evaluation Period and, if applicable, the grace period, then you will begin earning the rates earned by account holders without either Direct Deposit or Qualifying Deposits until you have Direct Deposit activity or $5,000 in Qualifying Deposits in a subsequent 30-Day Evaluation Period. For the avoidance of doubt, an account holder with both Direct Deposit activity and Qualifying Deposits will earn the rates earned by account holders with Direct Deposit.
Members without either Direct Deposit activity or Qualifying Deposits, as determined by SoFi Bank, during a 30-Day Evaluation Period and, if applicable, the grace period, will earn 1.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances.
Interest rates are variable and subject to change at any time. These rates are current as of 10/24/2023. There is no minimum balance requirement. Additional information can be found at https://www.sofi.com/legal/banking-rate-sheet.
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.
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