What is considered a ‘good income’ in America? Dave Ramsey explains his answer and tells an Ohio woman that her $36K/year job doesn't pass the test. Does yours?

Ramsey had a simple clarification — income is relative.

What’s a 'good' income?

Kelly earns $36,000 a year after taxes from her job at a professional screen printing and embroidery shop. She manages to save $1,100 a month towards a down payment for her eventual home purchase. She worked four jobs when she was studying at ministry school, and that allowed her to avoid any form of debt.

Kelly considers hers a “good income” but isn’t sure why Ramsey wouldn’t agree and is wondering if she needs to get another job.

“Good income is not a moral statement,” Ramsey explained. “Good income is relative to the average household income in America, which is $78,000 right now.” Real median household income in the U.S. was $78,250 in 2019 and fell to $74,580 in 2022, according to the Census Bureau. "You're not a bad person. You're not a horrible income earner. You're not lazy. None of those are judgements when we say 'good income,'" he added.

According to the U.S. Bureau of Labor Statistics, the median individual salary for full-time wage and salary workers is $1,145 per week, which is roughly $59,540 a year. By this measure, Kelly’s annual salary is 39.5% lower.

However, Kelly is performing better in other areas of her finances. The U.S. personal savings rate is 3.8%, according to the Bureau of Economic Analysis. This is the percentage of people's incomes left after they pay taxes and spend money. That is just over $2,200 a year in savings on a median income.

By comparison, Kelly is saving significantly more every year. She also has no debt, which puts her in a much better position than the average American who has $21,800 in debt excluding mortgages, according to research by Northwestern Mutual.