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Thanks to the convenience of direct deposit, many people never even glance at — much less analyze — their pay stubs or paychecks anymore.

But reviewing the information on your pay slip, which serves as a receipt for the wages you receive each pay period, is more important than you might think. It can help you monitor your retirement savings, for example, and the other employee benefits you’re receiving. It also can allow you to track how much you’re paying in taxes. And if you know how to read a pay stub, you might even spot errors that could cost you money or cause some headaches if they aren’t fixed right away.

Knowing the details of where your wages can be an important part of successfully managing your money.

The Basic Components of a Pay Stub

Federal law doesn’t require that pay stubs be distributed. State laws, however, require pay stubs in 41 states, with different guidelines for the contents. Not only can the details shared about one’s pay and how it’s organized can vary significantly from one state to the next, it may well shift from one employer to the next. Some pay stubs and paychecks have much more streamlined details than others. But some of the basic elements you can probably expect to find on your pay slip include:

•  Identifying information about your employer

•  Identifying information about you

•  The start and end dates of the current pay period

•  Information about your earnings

•  Information about taxes and deductions from your pay

•  Employer-paid taxes

•  Employer-paid benefits

This information is important for accurate recordkeeping for you and your employer.

Recommended: Emergency Fund Calculator: Estimate Your Safety Net

Personal Information and Pay Period Details

The personal information and pay period details section of your pay stub is typically where the most basic intel can be found, including your Social Security number, tax-filing status, and federal, state, and local withholding allowances.

If you have direct deposit, you also might see the routing and account number for the checking and/or savings account you use for that.

Why It Matters: The top section of your pay stub is probably the easiest portion to skim through — but it’s also worth making sure the information is correct. If your name is misspelled or just one digit of your Social Security number is off, for example, it could cause you problems later. And the IRS recommends reviewing your income tax withholding choices at least once a year, early in the year, to help avoid any surprises when you prepare your income taxes.

Breaking Down Earnings

The earnings section is where many people quickly zoom in to see how much money is coming their way. But it’s not one single number you’ll find in this section. Here’s what the earnings on your pay stub or paycheck can tell you.

Gross Pay vs. Net Pay: What’s the Difference?

You’ll likely be interested in how much you received for a given pay period. When looking for that, keep the following in mind:

•  Your gross earnings equal the money you made before taxes and other deductions were subtracted.

•  Your net earnings indicate the amount you’re actually paid after those deductions are taken out. So the net figure is the amount of cash landing in your checking account if you have direct deposit and send all your wages there. (And if you don’t, this is the amount you’ll see on your paper paycheck.)

These two figures may appear in different areas on the pay slip, not necessarily at the top. They are important to track: Understanding the difference in your net vs. gross pay can be useful for budgeting, goal-setting, and deciding how much to save from each paycheck.

Regular Wages and Overtime Pay

The earnings section is typically broken down into a few different categories, which may vary depending on, say, whether you’re a salaried or hourly employee. It may include your regular pay rate and how many hours you worked, for example, plus overtime, holiday, and vacation pay rates and hours.

Bonuses, Commissions, and Other Compensation

Some people simply earn a straight salary. But others may have other forms of compensation, such as a commission on sales or a year-end bonus. These amounts and any other forms of compensation will be listed.

Year-to-Date (YTD) Earnings

You can gain further insight onto your earnings when you compare a given pay period’s numbers and YTD, or year-to-date, figures. The YTD figures show how your income is stacking up over the course of the year and can help you track where you are in terms of your expectations for this juncture.

Why It Matters: Checking payment details can help you be sure your hourly wages/salary and other compensation amounts are correct. What’s more, tracking how much you’re earning in other pay categories can be helpful for tax and other planning purposes.

Recommended: How to Calculate Gross Monthly Earnings From a Biweekly Pay Stub

Decoding Deductions and Withholdings

Here’s where you’ll see your gross earnings shrink down to your net pay, thanks to statutory (or obligatory) and voluntary deductions.

Required Payroll Deductions

The statutory deductions listed on your stub are taxes employers are required by law to withhold from an employee’s pay. These include:

•  Federal income tax withholding, which the government uses to pay for school, roads, national defense, and other government programs.

•  Federal Insurance Contributions Act (FICA) taxes, which help fund Social Security and Medicare programs. (6.2% of your gross wages goes toward Social Security tax, and 1.45% of your gross wages goes to Medicare tax. Your employer matches these percentages for a total of 15.3%. These percentages can change, as determined by Congress.)

•  State income taxes, which will vary depending on where you live and work. Some states have no state income tax, while in other states, tax rates can range from typically higher (California) to lower (Arizona, North Dakota, and Oklahoma).

Elective Payroll Deductions

Other paycheck deductions you may see listed on your stub are for benefits you have a choice about, such as:

•  Health and dental insurance premiums

•  Life insurance premiums

•  Disability insurance premiums

•  401(k) or similar retirement plan contributions

•  Charitable giving

•  Union dues

Many of these costs may be pre-tax — deducted from your earnings before taxes are calculated — and others will be post-tax. If you aren’t sure whether certain of your benefits are pre- or post-tax and it isn’t clearly defined on your pay stub, you may want to ask someone in human resources, or HR, to break it down for you.

Why It Matters: It’s always a good idea to know what you’re paying for, so you can make choices that maximize your earnings. And understanding which payroll deductions are pre- or post-tax can help with budgeting and tax planning.

Employer Contributions

Knowing how to read this portion of your pay stub will help you see what your employer is paying for on your behalf, outside of your wages. This section may include a base amount paid by your employer for different types of insurance (which you can usually add to at your discretion), as well as any pension information, and the amount your employer is contributing to your retirement plan (based on an agreed-upon match based on your contribution amount).

The amounts your employer pays toward federal and state unemployment taxes may also be listed here with the acronyms FUTA (Federal Unemployment Tax Act) and SUTA (State Unemployment Tax Act).

Why It Matters: Workplace benefits can be a valuable addition to your regular compensation. If you’re thinking about shopping for a new employer — or a competitor has approached you with a job — it can be helpful to compare the salary and benefits package you’re getting from your current company vs. potential offers. Knowing how to read a pay stub or how to read a paycheck can help you evaluate where these aspects of compensation currently stand.

Interpreting Additional Information on Your Pay Stub

Some other types of information that may appear on your stub include:

•  Paid leave: The time off you’ve earned minus the time you’ve already taken may be listed under the employer benefits portion of your stub, or these hours (vacation, sick time, personal/flex time) may appear in their own section.

•  Loan repayment: If you borrowed money from your 401(k) and set up a repayment plan using payroll deductions, you can look for the current amount paid and year-to-date amount paid in the elective deductions section.

•  Wage garnishment: If your employer received a garnishment order (because you have unpaid child support or alimony, taxes, student loans, etc.), that amount may be listed under “deductions” or “other deductions.”

•  Notes: This section of your pay stub may contain updates from the company ranging from an upcoming increase in your wages to a heads-up about a coming charity drive.

Why It Matters: Keeping track of these pieces of information — which are often unique to you — can be useful, whether you’re budgeting for the month ahead or planning for a future goal.

Either way, understanding and checking the math that went into getting this final number can help you catch mistakes. And understanding the difference in your net vs. gross pay can be useful for budgeting, goal-setting, and deciding how much to save from each paycheck.

The Takeaway

There’s a wealth of data on your pay slip that can help you understand and possibly optimize your earnings. You can see how much you’re contributing to your retirement plan and how much your employer might be matching. And you can keep tabs on the other types of employer-paid benefits you’re receiving that go beyond your wages. You also can check to see if you’re still happy with how much is being withheld each payday for federal and state taxes, and if you need to make adjustments so there aren’t any surprises come tax time.

Another way to make the most of your hard-earned money? Partner with the right bank.

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with eligible 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 3.30% APY on SoFi Checking and Savings with eligible direct deposit.

FAQ

What should I do if I notice an error on my pay stub?

Comparing your newest pay stub to older slips can help you determine if there is, indeed, a discrepancy, and it’s one of the benefits of knowing how to read a paycheck. If you’ve spotted what you believe to be a mistake, it’s a good idea to take it immediately to your employer, such as someone in HR. Make sure the report is documented (you may have to put the issue in writing), and follow up as needed to make sure it’s explained and/or addressed.

How long should I keep my pay stubs?

It can make sense to hold onto pay stubs for at least a year. You may need them for tax preparation or for proof of income if you’re applying for a mortgage or other large purchase.

Can I get a copy of a lost pay stub?

If you’ve lost a pay stub and don’t know where to locate your earnings statements electronically, ask your manager or HR for help logging on to the company website and finding what you need. If you don’t have direct online access to your personal payroll records, you can contact HR or the payroll department for help getting a copy of your pay stub.

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Photo credit: iStock/AndreyPopov

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Although we do our best to recognize all Eligible Direct Deposits, a small number of employers, payroll providers, benefits providers, or government agencies do not designate payments as direct deposit. To ensure you're earning the APY for account holders with Eligible Direct Deposit, we encourage you to check your APY Details page the day after your Eligible Direct Deposit posts to your SoFi account. If your APY is not showing as the APY for account holders with Eligible Direct Deposit, contact us at 855-456-7634 with the details of your Eligible Direct Deposit. As long as SoFi Bank can validate those details, you will start earning the APY for account holders with Eligible Direct Deposit from the date you contact SoFi for the next 31 calendar days. You will also be eligible for the APY for account holders with Eligible Direct Deposit on future Eligible Direct Deposits, as long as SoFi Bank can validate them.

Deposits that are not from an employer, payroll, or benefits provider or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, Wise, 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 Eligible Direct Deposit activity. There is no minimum Eligible Direct Deposit amount required to qualify for the stated interest rate. SoFi Bank shall, in its sole discretion, assess each account holder's Eligible Direct Deposit activity to determine the applicability of rates and may request additional documentation for verification of eligibility.

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*Awards or rankings from NerdWallet are not indicative of future success or results. This award and its ratings are independently determined and awarded by their respective publications.

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.

Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.

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Attending a four-year university isn’t for everyone, but that doesn’t mean a high-paying job should be out of reach. There are plenty of roles that allow you to make a lot of money without a college degree. We’re not talking about brain surgery or rocket science — just normal jobs that pay well and may even be fun or cool.

Read on to learn more about various jobs that pay well and don’t require a college degree.

Why It’s Difficult to Know About Easy Jobs Without a Degree

When it comes to job searching, it’s hard to beat the power of networking. College students and graduates often have a leg up in this department. From alumni networks to on-campus job fairs, many institutions offer different ways to build important professional connections — and potentially learn about not-yet-posted job opportunities.

But you don’t necessarily have to go to college to create a professional network or find a job that doesn’t require a degree. Some strategies include attending industry events, engaging with social networks related to your area of interest, and requesting informational interviews with companies you’re interested in.

If you’re just starting out — or are considering a career change — you may also want to research growing industries that need workers. Certain roles may require some technical certifications or on-the-job apprenticeships. Still, they could offer competitive pay, coming close to or exceeding the annual expected salary for someone with a bachelor’s degree.

No matter your salary, it’s important to pay attention to your spending and saving. SoFi’s budget tracker tool gathers all your finance info in a single place so you can look at spending patterns, set financial goals, and monitor your credit score for free.

Recommended: Top 20 On-Campus Jobs

Pros and Cons of Easy Jobs Without a Degree

There are benefits and drawbacks to some jobs that make a lot of money without a college education.

Benefits of Easy Jobs Without a Degree

•   Beginning a career with little or no student debt

•   Entering the workforce earlier in life, with the potential to start saving sooner

•   Job security for roles that are in high demand

•   Less work-related stress, depending on the job

Drawbacks of Easy Jobs Without a Degree

•   Joining a high-paying trade or industry can be more physically demanding

•   Some roles require an apprenticeship or years of experience before you can earn a high salary. Entry-level salaries may be modest.

•   Lack of degree may stunt your earnings over your entire career in certain jobs

•   Jobs may be paid hourly, not salaried, which can impact earning potential

•   Less likely to accommodate work-at-home situations

Who Are Easy Jobs Without a Degree For?

High-earning jobs that don’t require a degree can be a good fit for many individuals, including those who:

•   Don’t traditionally excel in an academic environment

•   Don’t want to take on student debt

•   Are eager to enter the workforce

•   Have interest in a trade or technical job

25 Easy Jobs That Make a Lot of Money With Little Work Without College

Many jobs that don’t require a degree are minimum wage or low paying. However, there is a sweet spot where jobs that pay well but don’t expect a degree overlap. While some of the following call for certification or training, it’s unlikely to cost as much as a traditional four-year degree.

The following salary figures from the Bureau of Labor Statistics represent the national median, and the job growth outlook is for 2023 to 2033.

1. Power Plant Operator, Distributor, and Dispatcher

Description: Control and manage the electrical power systems of a plant.

Salary: $100,890

Job Growth: -8%

Requirements: High school diploma or equivalent

2. Commercial Pilot

Description: Fly commercial airplanes and other aircraft.

Salary: $171,210

Job Growth: 5%

Requirements: Flight school

3. Elevator Installer and Repairer

Description: Install, repair, and maintain elevators and escalators.

Salary: $102,420

Job Growth: 6%

Requirements: High school diploma or equivalent

4. Makeup Artist, Theatrical and Performance

Description: On-set makeup application in the entertainment industry.

Salary: $47,390

Job Growth: 9%

Requirements: On-the-job training or beauty school certifications

5. Fire Inspector and Supervisor

Description: Inspect buildings to ensure they meet local, state, and federal standards.

Salary: $71,420

Job Growth: 6%

Requirements: Experience as a firefighter; high school diploma or equivalent

6. Aircraft Mechanic

Description: Work on plane equipment, including maintenance and repair. While pilots tend to be extroverted high achievers, aircraft mechanic is a solid job for introverts.

Salary: $75,400 per year

Job Growth: 5%

Requirements: On-the-job military training or certification from an FAA-approved technician’s school

7. HVAC Technician

Description: Install, repair, and maintain HVAC systems in residential and commercial properties.

Salary: $57,300

Job Growth: 9%

Requirements: Technical school and/or an apprenticeship

8. Plumber

Description: Install and repair plumbing systems in homes, factories, or businesses. Plumber roles may include on-call emergency hours.

Salary: $61,550

Job Growth: 6%

Requirements: High school diploma or equivalent

9. Drafter

Description: Digitize and convert architecture and engineering drawings using software.

Salary: $62,530

Job Growth: -1%

Requirements: Associate degree or technical certification

10. Sales Rep, Wholesale and Manufacturing

Description: Sell goods, at wholesale, to businesses and organizations.

Salary: $73,080

Job Growth: 1%

Requirements: Depends on the industry. Technical sales roles may require certification beyond a high school diploma.

11. Physical Therapist Assistant

Description: PT assistants work alongside physical therapists in a medical setting to help patients regain mobility.

Salary: $58,740

Job Growth: 19%

Requirements: Associate degree, licensing, or certification

12. Radiation Therapist

Description: Administer radiation to patients in a hospital setting.

Salary: $98,300

Job Growth: 3%

Requirements: Associate degree

13. MRI Technician

Job Description: Operate the MRI machine to examine patients, and interpret scans.

Salary: $76,020

Job Growth: 6%

Requirements: Associate degree

14. Programmer

Description: Write and test code for a variety of programs and software across industries and verticals. Programming is considered a popular job choice for antisocial people.

Salary: $99,700

Job Growth: -10%

Requirements: Historically, roles have required a bachelor’s degree. Recently, employers are considering candidates with certifications or bootcamp training.

15. Postal Service Worker

Description: Process, collect, and deliver mail to homes and businesses.

Salary: $56,510

Job Growth: -4%

Requirements: High school diploma or equivalent

16. Claims Adjuster, Appraiser, Examiner, and Investigator

Description: Examine and appraise insurance claims, from automotive to residential or commercial building damage.

Salary: $75,020

Job Growth: -5%

Requirements: For most entry-level roles, a high school diploma or equivalent is required. In some industries, such as auto damage appraisal, a certification may be required.

17. Construction and Building Inspector

Description: Inspect residential and commercial buildings to ensure they adhere to local codes and specifications.

Salary: $67,700

Job Growth: 0%

Requirements: High school diploma or equivalent

18. Court Reporter and Simultaneous Captioner

Description: Create exact transcripts of exchanges, including courtroom proceedings, or live captioning on television.

Salary: $63,940

Job Growth: 2%

Requirements: Training or certification

19. Sound Engineering Technician

Description: Maintain sound systems for live performances, broadcasts, and other programming.

Salary: $59,430

Job Growth: 3%

Requirements: Varies but often includes technical certification

20. Police Detective

Description: Gather facts and investigate crimes. Some police departments are currently offering generous signing bonuses.

Salary: $74,910

Job Growth: 4%

Requirements: Police Academy completion and on-the-job training

21. Electrician

Description: Repair, install, and maintain electrical systems.

Salary: $61,590

Job Growth: 11%

Requirements: High school diploma or equivalent

22. Brick Mason

Description: Use concrete, stone, or brick to build structures.

Salary: $53,010

Job Growth: 0%

Requirements: Trade school or apprenticeship

23. Insurance Sales Agent

Description: Sell insurance, including home, life, and automotive. This is an excellent work-from-home job for retirees.

Salary: $59,080

Job Growth: 6%

Requirements: High school diploma or equivalent

24. Medical Sonographer

Job Description: Operate sonography or other specialty equipment in a medical setting to create digital imaging of patients.

Salary: $80,850

Job Growth: 11%

Requirements: Associate degree

25. Information Security Analyst

Description: Create and maintain security for a business’s computer networking systems.

Salary: $120,360

Job Growth: 33%

Requirements: Some employers may require a bachelor’s degree, but other roles call for on-the-job training or IT certifications instead.

Recommended: The Highest-Paying Jobs by State

The Takeaway

There’s a potential to earn a high salary in many jobs that don’t require a college degree. However, it may require some research and certifications beyond a high school diploma. Some jobs that pay well, don’t require a degree, and may even be enjoyable range from the medical field and construction to computers and insurance. If you know someone who’s a brick mason or a sonographer, take them out for coffee to get the inside scoop. You might even offer to shadow them at work to find out what their industry is really like.

Take control of your finances with SoFi. With our financial insights and credit score monitoring tools, you can view all of your accounts in one convenient dashboard. From there, you can see your various balances, spending breakdowns, and credit score. Plus you can easily set up budgets and discover valuable financial insights — all at no cost.

See exactly how your money comes and goes at a glance.

FAQ

What is the easiest job that pays the most?

One of the easiest jobs that pays well is working as a claims adjuster for insurance companies. A college degree isn’t usually required, but you may need to earn a license before you can start working.

What is the easiest job to get without a degree?

Depending on the industry, it can be relatively easy to get a job in sales with little to no prior experience. However, the role may include on-the-job training to get you up to speed.

What jobs pay a lot but are easy?

There are many jobs in the health care space that don’t require manual labor but pay well. This includes roles such as a radiation therapist or MRI technician.

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Photo credit: iStock/damircudic

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Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article.

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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Teaching can be a rewarding profession, but it typically isn’t a high-paying one. If you’re a teacher, it won’t surprise you to learn that 17.1% of teachers earn supplemental income from side jobs, according to a study by the Learning Policy Institute. The challenge is landing a gig that pays enough to make it worth your time and effort.

Not only do those positions exist, these days they can often be done online and on your own schedule. Read on for a look at some of the best-paying options for teachers looking for a side job in 2024.

Qualities of a Good Side Job for Teachers?

Teachers need to consider a number of factors before committing to a side gig: How much stress could the second job cause? Will the hours fit with your current work schedule? And of course, do you plan to work a second job year-round or just during seasonal breaks?

Things to Look for in a Year-Round Gig

•   Hours that accommodate your teaching schedule.

•   Workload and deadlines that won’t add to your stress level or lead to total burnout.

Things to Look for in a Summer Gig

•   A fun environment or flexible schedule that makes you feel that you’re still getting a break?

•   Something you can return to year after year — and maybe during other school breaks — so you don’t have to start over seeking a new job each summer.

Recommended: The Highest Paying Jobs in Every State

Things to Consider for Any Second Gig

•   Is the extra paycheck worth the extra work?

•   Could the work you’re doing damage your career as a teacher? (It can be a good idea to check with your employer to see if there are rules for outside jobs.)

•   Can you build skills you’ll use as a teacher, or in another career you might be interested in pursuing?

Pros & Cons of Online Side Jobs for Teachers

Teaching is a challenging job that requires patience and preparation. If you choose to add a side gig, it’s important to have realistic expectations. As you decide whether to take on more work — and what that work might be — here are some pros and cons to keep in mind:

Potential Benefits of a Side Job

•   Make extra money: It may take some searching to find a side gig that offers competitive pay — enough to make a difference in your financial situation. Even a few hundred a month can help cover day-to-day bills or finance a future goal, like paying off student loans. A free budget app can help, too.

•   Develop a backup plan: Your side job can help fill a financial gap if you ever decide to transition to another career, or if you leave one teaching job and take a while to find another. You may even decide the side job is a better fit than what you’re currently doing.

•   Acquire new skills: A side job can offer opportunities to network and socialize with new people, and learn or fine-tune skills.

Potential Downsides of a Side Job

•   Undermines work/life balance: Teaching already takes up much of your day — even when you aren’t physically at work. If you put that same amount of time and effort into a second job, it could take your attention away from your family and other things you love and enjoy.

•   Turns a passion into a pain: You might lose your love for your favorite hobby (photography, reading, writing, crafting, etc.) if you make it an obligation.

•   Requires startup costs: You don’t need a money tracker app to discover that if you have to invest money in equipment to get your business going — even if it’s just a new laptop or phone — it may take a while before you start making money.

Why It Can Be Difficult for Teachers to Find Online Side Jobs

Even though opportunities to work remotely are increasing, it still may be hard to find a side job online that meets your needs. The skill set required for an online job might be quite different from what you’re used to as a teacher — and some jobs can require applicants to have specialized training. If you’re completing an application online, it may be tough to convince the employer you can do the job even if you don’t have the training.

It also can be challenging to separate legitimate remote side jobs for teachers from scams that require you to put in some of your own money upfront in order to get the job. (Don’t ever pay for an opportunity!) Employment ads that aren’t specific about pay, or that require a lengthy application process, can also be a turnoff.

Recommended: 25 Highest-Paying Trade Jobs

Tips for Finding Online Side Jobs for Teachers

Here are some steps that can help you along on your side-gig search:

Assess Your Skills

Think beyond the classroom as you consider the many marketable skills you can bring to a second job.

Consider Your Interests

You’ll be more engaged and confident if you’re doing something related to your areas of casual expertise or hobbies.

Do Your Research

You may have to learn a new lingo just to understand some online job postings — and respond to them appropriately. Don’t let what seems to be gibberish keep you from finding your fit.

Find a Mentor

If you know someone who has a successful side gig, ask for advice about how to get started. For example, if you’re obsessed with budgets, consider an apprenticeship with an experienced financial planner.

Update Your Online Profile

Take the time to update your profile on relevant social media platforms — whether that’s LinkedIn or Etsy.

Keep Your Priorities in Mind

Be prepared to start small. If you love the work, you can always grow your role over time. You may choose at some point to change careers, but you’ll want to make that decision on your terms, not because you were distracted from your duties as a teacher.

24 Best-Paying Online Side Jobs for Teachers, Part 1: Year-Round

The amount of money you can earn through an online side job varies widely, depending on how many hours you put in, and whether you’re starting at an entry-level salary or being compensated for your experience and skills.

Below are two dozen online side jobs for teachers that potentially offer higher earnings. Average wages and job growth outlook are based on data from the Bureau of Labor Statistics. Most side jobs pay an hourly rate vs. a salary, but we’ve included both.

1. Data Scientist

Potential for Remote Work: Although full-time data scientists typically work in an office environment, much of their work is done online, which makes part-time remote work with flexible hours a possibility.

National Average Pay: $51.93 median hourly wage; $108,020 median annual wage

Job Growth Outlook: 36% (faster than most occupations)

Job Description: Data scientists create the algorithms and predictive models used to extract meaningful information used in making business decisions.

Job Requirements: Entry-level data scientists generally have at least a bachelor’s degree in mathematics, statistics, computer science, or a related field.

How to Get Started: Networking and attending in-person and virtual meetups can help get your foot in the door. Sites like Indeed and LinkedIn post data science jobs, and many companies post open jobs on their own websites.

2. English as a Second Language (ESL) Teacher

Potential for Remote Work: There are many opportunities for ESL teachers to instruct students virtually through video-conferencing platforms. Because learners come from around the world, teachers can put together a work schedule that fits their needs.

National Average Pay: $29.11 median hourly wage; $60,560 median annual wage

Job Growth Outlook: -13% (declining)

Job Description: ESL teachers tutor students who want to improve their English language skills.

Job Requirements: A bachelor’s degree (in English, communications, or a related field) and/or teaching certificate is typically required; good computer and communication skills are a big plus.

How to Get Started: Job sites like Indeed regularly post remote ESL teaching jobs. Other online platforms recruit ESL teachers, including VIPKid and Skooli.

3. Online Tutoring

Potential for Remote Work: There are all kinds of opportunities for teachers who want to tutor students online. One of the perks is that you can set appointments around your schedule.

National Average Pay: $19.01 mean hourly wage; $39,580 mean annual wage (pay varies based on subject and student needs)

Job Growth Outlook: 1%

Job Description: Duties might range from teaching toddlers their ABCs to offering test prep (SAT, ACT, LSAT, etc.) to high school and college students.

Job Requirements: Requirements vary based on subject and student age; a bachelor’s degree and/or teaching certificate may be required.

How to Get Started: You can find tutoring gigs on job boards or through platforms such as Care.com and Tutors.com. Or you may decide to set up your own tutoring business and advertise online.

4. Selling Lesson Plans

Potential for Remote Work: Thanks to the internet, teachers can now share learning materials they’ve created both locally and globally.

National Average Pay: Not available (varies by subject, grade, and amount of content sold)

Job Growth Outlook: Not available

Job Description: Create shareable lesson plans, flash cards, tests, etc., and sell them on your own website or an online platform.

Job Requirements: No set requirements, but you may be asked to prove your credibility when selling your content.

How to Get Started: Check out what others are doing on marketplace sites like TeachersPayTeachers or Etsy. Once you’ve created your content (be careful about copyright infringement), you can market your products on social media or through these platforms. Networking opportunities (attending conferences, etc.) can also help get the word out.

5. Editing / Proofreading

Potential for Remote Work: Content typically can be edited online and on your own schedule, depending on deadline needs.

National Average Pay: For editors, $36.07 median hourly wage, $75,020 median annual wage; for proofreaders, $23.45 mean hourly wage, $48,790 mean annual wage

Job Growth Outlook: For editors, -2% (declining); for proofreaders, -3%

Job Description: Editors plan, review, and revise content provided by writers; proofreaders check copy for errors.

Job Requirements: Good grammar and communication skills; some jobs may require a bachelor’s degree in English, journalism, or a related field.

How to Get Started: You can find editing and proofreading work on job boards or advertised by individual companies.

6. Freelance Writing

Potential for Remote Work: Because you generally can create content anytime and anywhere, freelance writing easily lends itself to remote working.

National Average Pay: $35.43 median hourly wage; $73,690 median annual wage

Job Growth Outlook: 5% (average for all occupations)

Job Description: Freelance writers provide content for print and online media.

Job Requirements: Good grasp of English language, spelling and grammar, and excellent communication skills. Some employers may require a bachelor’s degree in English, journalism, or a related field.

How to Get Started: You can pitch ideas to your favorite publications or look for work on job boards and platforms such as Upwork and Fiverr. Consider creating a website to showcase your talent. And networking (word of mouth) can be key. If you have a particular expertise (technical, travel, or food writing, for example), make that information known.

7. Creating Printables

Potential for Remote Work: This is another job you can do on your own time and almost completely online.

National Average Pay: Not available

Job Growth Outlook: Not available

Job Description: Create customized calendars, cheerful stickers, classroom decorations, etc.

Job Requirements: Creativity and good design skills are a must; you’ll also need the appropriate design software.

How to Get Started: Creators typically sell printables on sites like Etsy or their own website. Get the word out on social media and by networking and attending conferences for educators, organizational experts, etc.

8. Selling Artwork and/or Crafts

Potential for Remote Work: It may be easier to sell your goods in person at a local craft fair, but if you sell online, you can reach a wider audience and do it on your own time.

National Average Pay: $25.44 median hourly wage; $52,910 median annual wage

Job Growth Outlook: 3% (average)

Job Description: Selling your own creative works (paintings, photos, sculptures, etc.)

Job Requirements: Creativity and skill in your artistic niche as well as marketing, business, and computer skills.

How to Get Started: Check out e-commerce sites like Etsy and Society6 to see how others are marketing themselves and their products. You can use social media to get the word out, and you may want to develop your own e-commerce site to sell your goods. Be sure to check into whether a business license is required in your area.

9. Medical Transcriptionist

Potential for Remote Work: Because you’ll be working from recordings, you typically can do this work remotely and when it’s convenient for your schedule (deadlines may apply). This position may also be a low-stress option for introverts.

National Average Pay: $17.82 median hourly wage; $37,060 median annual wage

Job Growth Outlook: -5% (declining)

Job Description: Transcribe audio content into written content.

Job Requirements: May require certification. Employers may test for typing speed and accuracy. Discretion and some knowledge of medical terms and basic anatomy are a plus. You may have to purchase special equipment to do the job.

How to Get Started: Check out job boards and medical transcription sites. A transcription course (in-person or online) may offer career services.

10. Graphic Designer

Potential for Remote Work: Graphic designers can do most of their creative work on their own schedule, but you will have to find time to communicate with your clients. And deadlines may be a factor.

National Average Pay: $28.32 median hourly wage; $58,910 median annual wage

Job Growth Outlook: 2% (slower than the average for all occupations)

Job Description: Use design software to create visuals that convey your employer’s message.

Job Requirements: Knowledge of design software, creative skills, and an ability to collaborate with others; some employers may require a bachelor’s degree in graphic design or a related field.

How to Get Started: Job boards offer remote graphic design positions for a wide range of specialties. You also can build an online portfolio and use social media to generate interest.

11. Life Coach

Potential for Remote Work: Life coaches can manage client sessions by phone or with video conferencing.

National Average Pay: Not available

Job Growth Outlook: Not available

Job Description: Assist clients in reaching their full potential.

Job Requirements: No formal requirements exist for life coaches, but prospective clients may prefer that you have some type of training or credentials. A background in counseling and psychology is helpful. Important traits include empathy, patience, and creative problem-solving skills.

How to Get Started: It may help to work with an experienced life coach when starting out. Networking and social media can be a useful way to find clients.

12. Translator

Potential for Remote Work: Freelance translators typically can work from home using their own computer.

National Average Pay: $27.45 median hourly wage; $57,090 median annual wage

Job Growth Outlook: 2% (slower than the average for all occupations)

Job Description: Convert written content from one language to another.

Job Requirements: Must be proficient in English and at least one other language; some employers may require a bachelor’s degree.

How to Get Started: Check translation agencies and job boards, or you can solicit work through social media.

13. Digital Marketer

Potential for Remote Work: If you can collaborate with clients and coworkers without meeting in person, this job can be done remotely.

National Average Pay: Not Available

Job Growth Outlook: Not Available

Job Description: Promote individuals and businesses using social media, search engines, websites, and other online tools.

Job Requirements: Should be familiar with social media platforms. Creativity, patience, and strong communication and problem-solving skills are a plus. Some employers may require a bachelor’s degree in communications, marketing, public relations, journalism, or a related field.

How to Get Started: Networking — online and in person — can be a good way to get your foot in the virtual door; check job boards for listings.

14. App Developer

Potential for Remote Work: Developers often work independently.

National Average Pay: $44.59 median hourly wage; $92,750 median annual wage

Job Growth Outlook: 8% (faster than average)

Job Description: Create, test, and improve software applications.

Job Requirements: Collaboration, creativity, and tech savviness are important. Some employers may require a bachelor’s degree in information technology, computer science, or a related field.

How to Get Started: Taking courses in app development and networking with like-minded creative types Can help with finding a mentor and freelance gigs.

15. Creating Video Tutorials

Potential for Remote Work: You can produce videos on your own anywhere you like and on your own time.

National Average Pay: Not Available

Job Growth Outlook: Not Available

Job Description: Film tutorials and monetize them.

Job Requirements: Knowledge of your subject, technical ability to produce videos, and marketing savvy to build your brand. You’ll also need a good video camera and computer.

How to Get Started: Anyone can make an instructional video and upload it to YouTube. Building a strong portfolio and a reputation for solid content will help you monetize your videos.

16. Fitness Trainer

Potential for Remote Work: If you can find clients who prefer to exercise from home and can do their workouts when you’re available, you can teach them from your home.

National Average Pay: $22.35 median hourly wage; $46,480 median annual wage

Job Growth Outlook: 14% (much faster than average)

Job Description: Teach online classes in general fitness, yoga, strength training, etc.

Job Requirements: Though no degree is required, there are certifications available for personal trainers. You’ll also need good lighting, space to do your workouts, and video and computer equipment.

How to Get Started: If you’re a physical education teacher, coach, or a longtime gym-goer, you can spread the word on social media and through word of mouth.

17. Blogging

Potential for Remote Work: Blogging can be done at your convenience.

National Average Pay: Not available

Job Growth Outlook: Not available

Job Description: Entertain and inform an online audience with written and visual content.

Job Requirements: To make money from a blog, you’ll need to engage your audience and post frequently.

How to Get Started: You can start out by writing on a popular blogging platform, and then get the word out on social media. Network with others who may be interested in what you’re blogging about.

18. Test Scorer

Potential for Remote Work: Remote workers can score most types of multiple choice and essay exams.

National Average Pay: Not available

Job Growth Outlook: Not Available

Job Description: Grade tests and offer feedback to test-givers and test-takers.

Job Requirements: Subject expertise and attention to detail. Some employers may require a bachelor’s degree in education or a related field.

How to Get Started: Job boards frequently offer test scoring gigs, or you can query evaluation services like ETS and Measurement Incorporated.

19. Curriculum Specialist

Potential for Remote Work: Teachers typically can provide curriculum support online at their convenience, though you may have to meet with others in person or at scheduled online conferences.

National Average Pay: $35.87 median hourly wage; $74,620 median annual wage

Job Growth Outlook: 2% (slower than average)

Job Description: Develop curriculum and/or offer feedback to schools and other education services.

Job Requirements: Employers may require a bachelor’s or master’s degree as well as a few years of experience in teaching or a related field.

How to Get Started: Check job boards, but you may also find opportunities while networking with other educators.

24 Best-Paying Online Side Jobs for Teachers, Part 2: Seasonal / Summer

Because these jobs may require interacting with an employer or team members in person or remotely during the day, teachers may find it’s easier to put in their hours during seasonal school breaks.

20. Customer Service Representative

Potential for Remote Work: Customer service representatives often can work from home. However, you may have to attend some in-person training sessions before you get started, and you’ll have to find a work schedule that fits with your teaching job.

National Average Pay: $19.08 median hourly wage; $39,680 median annual wage

Job Growth Outlook: -5% (declining)

Job Description: Provide support to customers who require assistance.

Job Requirements: Patience and good communication and problem-solving skills are key. Some type of on-the-job training likely will be required. Some companies have requirements for the type of computer and phone you can use, and a strong Wi-Fi connection is a must. (Shy types need not apply, but there are plenty of jobs for antisocial people.)

How to Get Started: Customer service jobs are often listed on online job boards and through employment agencies.

21. Travel Agent

Potential for Remote Work: This job can be done remotely, but travel agents should be available to communicate with anxious clients who have questions and concerns.

National Average Pay: $22.79 median hourly wage; $47,410 median annual wage

Job Growth Outlook: 3% (as fast as average)

Job Description: Help clients choose and book work and leisure trips; provide assistance when problems arise.

Job Requirements: Good communication, customer service, and organizational skills are important. Some employers or clients may expect you to have some type of certification. Lots of travel experience is a plus.

How to Get Started: Check job boards and local agencies. It may help to work for an agency first before starting your own business.

22. Tax Preparation

Potential for Remote Work: Tax services regularly hire seasonal workers to prepare returns from home.

National Average Pay: $23.56 mean hourly wage; $49,010 median annual wage (does not include accountants and auditors)

Job Growth Outlook: 4% (as fast as average)

Job Description: Work with individuals and businesses to prepare tax returns and assist in resolving tax issues.

Job Requirements: Must be well-versed in current tax code. May have to complete company training. Must maintain a Preparer Tax Identification Number and may need an Electronic Filing Identification Number (EFIN).

How to Get Started: Check job sites or go directly to companies like H&R Block, Intuit, or small local firms. Seasonal work (January through April) is easier to find, but some year-round opportunities may be available.

23. Appointment Generator

Potential for Remote Work: Working remotely should be doable, but it may be difficult to manage the work during off hours.

National Average Pay: Not available

Job Growth Outlook: Not available

Job Description: Handle cold calling and book appointments for real estate agents and other sales professionals.

Job Requirements: Strong communication and organizational skills.

How to Get Started: Check job boards and promote your services on social media; attend networking events.

24. Virtual Assistant

Potential for Remote Work: Many administrative duties can be handled online and after hours. If you’re required to do phone work, however, you may have to limit your work time to school breaks.

National Average Pay: $22.12 average median salary; $46,010 median annual salary (includes administrative assistants who work onsite)

Job Growth Outlook: 1% (slower than average)

Job Description: General administrative support may include organizing and answering emails, scheduling appointments, arranging travel, and making phone calls.

Job Requirements: Strong communication and organizational skills, attention to detail.

How to Get Started: Job boards are loaded with positions for different types of virtual assistants.

The Takeaway

If you’re a teacher looking to earn additional income, you’ll find there are many side jobs that fit your skills and schedule, and still offer a competitive paycheck. You can take on jobs that tap into your educational expertise: tutor, curriculum specialist, lesson plan developer, test scorer. Or you may prefer to pursue another passion, like selling your artwork or working as a virtual assistant for a nonprofit you admire. The keys are to avoid burnout and to make the most of the time you put in.

Take control of your finances with SoFi. With our financial insights and credit score monitoring tools, you can view all of your accounts in one convenient dashboard. From there, you can see your various balances, spending breakdowns, and credit score. Plus you can easily set up budgets and discover valuable financial insights — all at no cost.

See exactly how your money comes and goes at a glance.

FAQ

How can teachers make extra money online?

Working remotely allows teachers to pursue a second job that fits their schedule and their skills. Many opportunities are available on job boards and freelance sites.

What are the best side jobs for teachers?

The best side jobs for teachers are those that allow them to earn a good paycheck while maintaining a healthy work-life balance. Remote freelance work is easy to find these days, and generally pays better than minimum wage. Check freelance job boards for ideas.

What are the most profitable side hustles?

Some of the most profitable side hustles are technology-oriented. Those jobs also can be a good fit for people who wish to work remotely. If you have skills or experience with computers, IT, or app development, you can parlay it into a well-paying side gig. Full-timers can easily make a $100,000 salary.

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Photo credit: iStock/DMEPhotography

SoFi Relay offers users the ability to connect both SoFi accounts and external accounts using Plaid, Inc.’s service. When you use the service to connect an account, you authorize SoFi to obtain account information from any external accounts as set forth in SoFi’s Terms of Use. Based on your consent SoFi will also automatically provide some financial data received from the credit bureau for your visibility, without the need of you connecting additional accounts. SoFi assumes no responsibility for the timeliness, accuracy, deletion, non-delivery or failure to store any user data, loss of user data, communications, or personalization settings. You shall confirm the accuracy of Plaid data through sources independent of SoFi. The credit score is a VantageScore® based on TransUnion® (the “Processing Agent”) data.

Non affiliation: SoFi isn’t affiliated with any of the companies highlighted in this article.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

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.

SORL-Q424-014

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First-time parents can be so preoccupied with the love they feel for their new babies and the constant care required that they may lose sight of their larger financial goals. When you’re busy getting to know your little human, you may not prioritize money management.

But securing your growing family’s finances is an important consideration. You have new needs and goals evolving, such as your child’s education and your retirement. Here’s smart advice to help you manage your money well during this new life stage and beyond.

7 Financial Tips for New Parents

Raising a child can cost more than $15,000 a year, according to one recent calculation using U.S. Department of Agriculture data. That can put some serious stress on your finances. Here’s guidance on making your money work for you and your family.

1. Avoid Overspending on Baby Gear

As a first-time parent, you likely have quite a bit of work to do before the baby arrives. You may need to create and furnish a nursery for your child, and stock up on diapers, bottles, clothes, toys, and so much more.

As you’re setting up your new life with a baby, it can feel like buying everything brand-new is the only option, but that can be costly. You might consider taking advantage of used or gifted items so as not to deplete your bank account.

You can buy a lot of items secondhand at a lower cost through online marketplaces or used goods and consignment stores. Or you might see what “freecycle” networks in your area have available at no charge. That’s one way to save money daily.

And if you have friends, family, or neighbors that already have children, they may be looking to unload some of the gear their children no longer use. Families with older kids are often happy to pass on items such as clothes, cribs, playpens, toys, and books. You might check Nextdoor.com and other community sites, which can be a good resource for local families seeking to offload these items.

2. Don’t Live Without a Safety Net

As a parent, you have a host of new responsibilities, and expenses you never imagined may pop up. So consider these moves:

•   An emergency fund becomes even more important when you have a child or one is on the way. You’re now responsible for all of their needs, and there may be unplanned costs that pop up along the way. Or, if you were to endure a job loss, you’d need to continue to provide for your child.

•   Saving for an emergency is a process, and it’s okay to start small — even just $25 a week will add up over time. Some people opt to store their emergency fund in a high-yield savings account or checking account. Earning interest that way will help your money grow faster.

•   Review your health insurance. You may want to opt for a different plan now that you have a child. An addition to the family is usually a qualifying life event (QLE) that can allow you to make changes regarding your plan outside of the usual open enrollment period.

•   Consider life insurance and disability insurance if you don’t already have it or, if you do, see if you want to update your coverage. When a little one is depending on you, you probably want to protect their future if you weren’t able to earn your usual income. Maybe you can only afford a modest policy at this moment. That can be fine; it’s a start and something you can revisit later as you grow your wealth.

3. Keep a Budget

With a baby on board, you likely have a host of new expenses, from the life insurance mentioned above to daycare to toys (and more toys). Making a budget can help you prepare to pay for the extra expenses.

The word “budget” can conjure up fear, but it’s really just a helpful set of financial guardrails that help you balance how much you have coming in and how much is going out towards expenditures and savings.

•   You might try the popular 50/30/20 budget rule which says that 50% of your take-home pay should go toward needs, 30% toward wants, and 20% toward savings.

•   You could check with your financial institution to see what kinds of tools they provide for tracking your money. This can be a great resource as you work to improve your money management and hit your goals.

•   To make a budget, you might also see what apps or websites offer products that could work for you. Check with trusted friends to see what they may recommend.

4. Don’t Put Off Retirement Savings

Another financial mistake new parents: Learning to pay yourself first isn’t easy for a lot of parents to do, but it’s vital. (For instance, while you can borrow money for college expenses for your child, you can’t likely borrow for your retirement.)

For retirement saving, one way to start is by enrolling in your company’s 401(k) plan if one is offered. Some employers will match your contribution, up to a certain percentage, and you’ll be able to have your contribution taken directly from your paycheck.

If your employer doesn’t offer a 401(k), you could open an individual retirement account, or IRA, instead. Getting in the habit of saving at least a little for your own future can be important as your focus shifts to your new addition.

It’s never too early to start saving for retirement.

5. Start Savings for Your Child’s College

Saving for your children’s tuition can be an important step for many new parents. That’s because the sooner you start, the better. Your money will have that much more time to grow. College is a big-ticket expense, with estimates of tuition in 18 years being calculated as follows:

•   $25,039 per year for a public college

•   $48,380 per year for a private college

While a standard savings account may seem like the easy choice, there are other options designed to help you or grandparents save for a child’s education.

•   You might opt for the benefits of a 529 college savings plan. There are two types: education savings plans and prepaid tuition plans.

•   With an education savings plan, a tax-deferred investment account is used to save for the child’s future qualified higher education expenses, like tuition, fees, room and board, computers, and textbooks. Funds used for qualified expenses are not subject to federal income tax.

•   With a prepaid tuition plan, an account holder purchases units or credits at participating colleges and universities for future tuition and fees at current prices for the beneficiary. Money in this fund is guaranteed to rise at the same rate as tuition. Most of the plans have residency requirements for the saver and/or beneficiary.

•   A Coverdell Education Savings Account may also be worth looking into. In general, the beneficiary can receive tax-free distributions to pay for qualified education expenses. Contributions to a Coverdell account are limited to $2,000 per year, per beneficiary. The IRS sets no specific limits for 529s.

6. Make the Most of Tax Breaks

Another bit of financial advice for parents is that when you have a child, you may be eligible for certain tax benefits.

•   The Child and Dependent Care Credit: If your child is in daycare or preschool or you pay for another kind of caregiving, you may be eligible to claim this credit, which varies based on your income. Typically, you can get a credit of between 20% and 35% of qualifying expenses up to $3,000 for one dependent or $6,000 for two or more.

•   The Child Tax Credit: This allows parents to get a tax credit of up to $2,000 per child under the age of 17. Other qualifying dependents up to age 24 may provide a credit of $500 each.

•   The Earned Income Tax Credit: Lower-income parents may be able to claim this credit, which varies with income and number of children. The Internal Revenue Service (IRS) offers a calculator to check eligibility.

•   Adoption Tax Credit: This offers tax incentives to cover the cost incurred if you adopted a child. In 2024, the maximum credit was $16,810 per qualifying child.

You might consult a tax professional to see which of these you can claim.

7. Teach Your Kids About Money

If kids aren’t taught the basics of financial literacy at a young age, they may struggle to make a budget, avoid credit card debt, or save money when they’re older. You can help your children learn what it means to manage money in these ways:

•   Kids often love to play store, so go ahead and join in. By exchanging goods for money, they’re already beginning to understand the basic principles of commerce.

•   As they get older, you may want to give them an allowance in exchange for chores or homework completion.

•  You could even have them make a budget with their earnings, and encourage them to spend, save, and donate.

•  You could open a checking account with them, once they are old enough, and teach them how it works.

•  You might give them a gift card or prepaid debit card and coach them on sensible spending.

Can You Ever Be Fully Financially Ready for Parenthood?

It’s probably not possible to be fully financially ready for parenthood or for adult life in general. Part of each person’s financial journey is learning how to plan for the unexpected and navigate curveballs. That might mean financing a child’s dance lessons or speech therapy. You might wind up moving to what you consider a better school district and paying more for your mortgage and taxes.

That’s why embracing some of the guidelines above, such as making a budget, stocking an emergency fund with cash (perhaps sending some money there via direct deposit), and saving for the future can be so important.

The Takeaway

Being a new parent is a joyful time but also a challenging one. One priority not to lose track of is your financial health, especially since you are now providing for a little one and their future. By budgeting and spending wisely, saving for the future, and knowing which tax credits you may be able to claim, you can help yourself get on the path to financial security for your family.

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with eligible 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 3.30% APY on SoFi Checking and Savings with eligible direct deposit.

FAQ

How can you plan financially for parenthood?

Planning financially for parenthood can involve updating your budget, allocating funds to the right insurance policies and long-term goals (such as your child’s education and your own retirement), and creating an emergency fund, if you don’t already have one. Also educate yourself on any tax credits you might qualify for once you become a parent.

What are the biggest unforeseen expenses of parenthood?

Some of the unforeseen expenses of parenthood include your child’s medical, dental, and mental health costs; academic support (such as tutors and prep classes); hobbies (taking tae kwon do classes, perhaps, or traveling with their soccer club); and funding any family travel and vacations.

How much does a child cost per year?

The cost of raising a child per year can vary widely, depending on such factors as medical needs and whether they are attending public or private school. That said, recent studies suggest the current average figure is around $15,000 to $17,500 per year per child.

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See additional details 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.

Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.

SOBNK-Q324-101


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In some ways, net worth and wealth can be tricky terms to define. To some people, the phrases are synonymous. As others acknowledge, the perception of wealth is influenced by a variety of factors, including where you live, your career, and your age.

Here’s a deep dive into how to calculate individual net worth and some of the factors that may influence our perception of wealth.

How to Calculate Individual Net Worth

An individual’s net worth is the value of all of their combined assets minus any liabilities (that is, outstanding debts). If your assets are worth more than your liabilities, you have a positive net worth. If you owe more than you own, your net worth is negative.

Assets you may use as part of your net worth calculation can include:

•  Real estate. Your home, second home, rental property, commercial real estate, or other holdings.

•  Cars and other vehicles. Note that automobiles are typically subject to depreciation in value over time.

•  Investments. Stocks, bonds, mutual funds, and retirement accounts.

•  Cash

•  Life insurance. Use the cash value.

•  Household items. Furniture, silverware, etc.

•  Jewelry. Plus precious gems and metals.

Liabilities are debts such as:

•  Balance remaining on your mortgage

•  Student loans

•  Auto loans

•  Credit card debt

Recommended: Does Net Worth Include Home Equity?

What Is the Difference Between Net Worth and Income?

Net worth and income don’t necessarily go hand in hand. Income is the money that is reported on a tax return, while a high net worth results from owning valuable assets. High net worth could be a result of careful saving, inheriting money, or hanging onto highly appreciated assets.

For example, let’s say someone bought a house in a once-undesirable neighborhood decades ago. Today, that neighborhood is super popular and the house is worth much more. Even if they don’t sell, the homeowner has increased their net worth without a boost in income. (It can be useful to see how net worth changes by age and location.)

On the other hand, a professional with a high salary who carries a lot of debt could have a relatively low net worth, especially if they also maintain a costly lifestyle. That said, various types of income certainly can have a big impact on how much wealth a person is able to accumulate.

Income is also one way that researchers sort individuals into economic classes, though the income ranges that delineate class can vary from year to year and by research methodology.

What Salary Is Considered a Middle-Class Income?

Pew Research Center defines middle-income Americans as those whose annual size-adjusted income is two-thirds to double the median size-adjusted household income. (Size-adjusted household income refers to the number of people within the household.)

A middle-income family of three earned $56,600 to $169,800 in 2022, the most recent information available from Pew Research.

What Salary Is Considered an Upper-Class Income?

Upper-income individuals earn more than double the median size-adjusted household income. This means a family of three may earn more than $169,800.

Wondering how your income compares? It can be helpful to look at the median income for a three-person household in each income tier.

Income Tier	Median Income in 2022
Upper Income	$256,920
Middle Income	$106,092
Lower Income	$35,318

Source: Pew Research Center

Why Wealth Is Relative Person to Person

The definition of “wealthy” differs depending on a person’s background, geography, and age. Consider a law student who earns very little money each year and carries hundreds of thousands in student debt. While their current wealth may be low, their potential future earnings may be quite high, and could catapult them into the wealthiest classes.

Consider, too, that where you live has a big impact on how far your wealth will stretch. A middle-income earner in an expensive city like San Francisco or New York may find it more difficult to make ends meet than someone in a small town in Oklahoma with a lower cost of living.

Ways to Measure Wealth

Wealth and net worth can be considered synonymous in some cases. But there are other factors that play into the perception of wealth and a person’s ability to accumulate it. Examples include demographic differences and potential return on investment, which may not have an immediate impact but can increase future wealth.

Income

As mentioned above, high income does not necessarily lead to high net worth — but it can. High earners may use their income to acquire assets that maintain equity, such as a home. These people may also use their earnings to invest within retirement and brokerage accounts.

Personal Savings

Your personal savings may refer to the cash you have on hand in checking and savings accounts, certificates of deposit, and money market accounts. It may also refer to the savings you have invested in brokerage and retirement accounts.

Ideally, these investments will appreciate over time, increasing net worth and providing a future source of income to maintain your standard of living after you stop working. As you build up your savings, tools like a money tracker app can help you keep tabs on your money.

Investment Rate of Return

An important factor in accumulating wealth is the rate of return (ROR) on your investments. Investment returns are not guaranteed. Stock prices rise and fall according to various trends in the market. Even bonds, which are relatively safe, are subject to default from time to time.

In the past, the stock market tended to rise over the long term. In fact, since 1926, the average annual rate of return for the stock market has been about 10%, surpassing potential returns for other major types of investments, including bonds.

Investors who save more, and hold more of their investment portfolio in stocks, may be better positioned to take advantage of these potential future returns.

Real Estate Assets

One way to think about wealth is as the maintaining of assets. Real estate can be a good place to build equity, and it can appreciate in value. Returns can vary widely depending on what type of real estate you buy — whether a home or commercial property — and where the property is located. Historically, the rate of return on real estate has been close to stock market returns. In the U.S. market, the median return on real estate investment is 8.6% annually, per the S&P 500 Index.

Age and Family Status

Demographic factors can have an impact on how much money you earn and the wealth you can accumulate. For example, median weekly earnings vary by age and gender.

Perhaps unsurprisingly, men and women ages 16 to 24 have the lowest median weekly earnings, with men earning $771 per week and women earning $695 in the second quarter of 2024, according to Bureau of Labor Statistics data.

Men age 35 and over enjoyed the highest median weekly earnings:

•  35 to 44: $1,379

•  45 to 54: $1,470

•  55 to 64: $1,361

Women earned less overall than men:

•  35 to 44: $1,114

•  45 to 54: $1,151

•  55 to 64: $1,048

The number of people in a household has a different impact. More people under one roof may require a larger home and more money spent on things like groceries, clothing, and transportation. As a result, a single individual usually requires less wealth to maintain a certain lifestyle than a family of five.

Good Credit Score

While not exactly a measure of wealth, a good credit score is a measure of financial health. It suggests that you have not taken on more debt than you can handle, and that you are able to make your payments on time.

A good credit score can also help you leverage your wealth to achieve financial goals. For example, lenders will look at your credit score when you apply for a loan to determine your creditworthiness. A good score can help you qualify for loans with lower interest rates. Individuals with bad credit, on the other hand, may be seen as a risk, and lenders may charge higher interest rates to compensate.

As a result, a good credit score can help you qualify for loans, such as a mortgage, at affordable rates that can help you build wealth.

Difference Between Material Wealth vs Spiritual Wealth

Material wealth is dependent on the physical and financial assets that you own and the debts you carry. Spiritual wealth, on the other hand, is not based on tangible items. Rather, it’s based on things like a sense of well-being and happiness.

Are material wealth and spiritual wealth linked? In a 2023 paper, authors Daniel Kahneman, Matthew A. Killingworth, and Barbara Mellers discovered an overall connection between larger incomes and increasing levels of happiness. But they also found that happiness peaks at $100,000 a year and then plateaus in people who are already unhappy.

Appreciating What You Have

One of the reasons that higher income doesn’t always translate into greater wealth is a phenomenon known as “lifestyle creep.” This occurs when increasing income leads to an increase in discretionary spending. A certain amount of lifestyle creep can result from trying to “keep up with the Joneses” — a tendency to accumulate material goods to compete with others in one’s perceived social class.

For example, as a person earns more, they might buy a bigger house, a more expensive car, pricey clothes, and start sending their kids to private school. These costly habits can mean that the individual may not be able to save more than when their salary was lower.

Try to avoid lifestyle creep by putting off grand lifestyle changes, like buying a large home, and putting off big purchases until absolutely necessary. Build and stick to a budget that includes wealth-building line items, such as saving in retirement funds. Track your progress with a budgeting app.

Practice appreciating what you already have, and you may find that some of the upgrades you desire are just wants — not necessities.

Recommended: What Credit Score Is Needed to Buy a Car?

The Takeaway

Net worth and wealth are inextricably linked. Measuring net worth helps people assess how many assets they currently have at their disposal. Accumulating wealth is about acquiring and maintaining assets that hold their value or increase in value. Doing so often requires careful saving and investing, as well as constant monitoring to ensure you stay on track.

Take control of your finances with SoFi. With our financial insights and credit score monitoring tools, you can view all of your accounts in one convenient dashboard. From there, you can see your various balances, spending breakdowns, and credit score. Plus you can easily set up budgets and discover valuable financial insights — all at no cost.

See exactly how your money comes and goes at a glance.

FAQ

What salary is considered middle-class income?

Middle-income Americans have annual incomes that are two-thirds to double the median income, according to Pew Research. For example, a middle-income family of three will earn $56,600 to $169,800.

What salary is considered upper-middle class income?

An upper-middle class income is at the high range of middle class income. According to the U.S. Census Bureau’s “Income in the United States: 2022” report, that’s an average annual income of $94,001 to $153,000.

What salary is considered lower-class income?

Low-income Americans are anyone earning less than two-thirds of the median household income. Per Pew Research Center, that means a family of three would have a household income of less than $56,600.

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Photo credit: iStock/fizkes

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