That is the federal minimum wage in the United States: $7.25. Twenty-nine states and the District of Columbia have decided to increase their state’s minimum wage, however, many states remain at $7.25. Not to mention, restaurant servers oftentimes make much less ($3.00 an hour, on average).
Can You Survive on Minimum Wage?
Depending on what you consider to be “survival,” yes you can survive on minimum wage but not unless you have a seriously strict budget. You also won’t be able to live alone and you’ll likely live paycheck to paycheck or even live in debt. Take this quiz to see if you could survive on minimum wage.
Why Minimum Wage Should Be Increased
If you’re living on minimum wage, there are many things you have to give up. Here are just a few reasons why the minimum wage should be increased:
- You can’t pay rent on minimum wage. For the most part, paying rent on $7.25 an hour with no roommate or spouse to supplement your income is impossible. Rent across the U.S. is high. In states where the minimum wage is higher, people are able to afford a one-bedroom apartment without assistance or any real financial sacrifice. That isn’t the case in states with a minimum wage of $7.25.
- If you have debt and make minimum wage, you’ll be in debt forever. If you’re only making $7.25 an hour and work full time you will likely have to put a lot of your day-to-day purchases on credit to be able to pay your bills. Those who have student loans, auto loans or other debt already will also find it close to impossible to pay down with a minimum wage salary.
- It makes it close to impossible to save. Not only is it impossible to pay off debt (and nearly impossible not to create new debt) on minimum wage, it is also extremely difficult to save. A large number of Americans don’t have enough cash in savings to cover a $1,000 emergency. This is definitely true of most minimum wage workers.
- Paying for food and groceries can be difficult. On top of your regular monthly bills, food can seem like an overwhelming expense when you are working for minimum wage. Not knowing whether or not you’ll be able to put food on the table is stressful.
- You can’t really live on minimum wage. Sure, there are people surviving on minimum wage but they aren’t really living. For the most part, they aren’t able to be financially independent and they aren’t able to plan for their own financial futures. Both of these things can impact their lives for years to come.
Many people have debated whether the federal minimum wage should be increased or not, however, there should really be no debate. $7.25 an hour is not a livable wage, especially when you are trying to better your personal finances or plan for the future.
Have you had to survive on minimum wage? What was your experience?