Using Alex's rule of thumb, what is a good estimate of take-home pay for someone with a gross annual salary of $50,000?

To arrive at a good estimate of take-home pay using Alex's rule of thumb, we typically consider that about 25% to 30% of a gross salary may be deducted for taxes and other withholdings. This means that approximately 70% to 75% of the gross salary will remain as take-home pay.

In the case of a gross annual salary of $50,000, applying a withholding percentage of around 25% leads us to calculate the take-home pay as follows:

1. Calculate the potential deductions:

25% of $50,000 is $12,500.

2. Subtract this amount from the gross salary to find the take-home pay:

$50,000 - $12,500 = $37,500.

This calculation indicates that an estimated take-home pay of $37,500 aligns with the commonly used rule of thumb, making it a reasonable expectation based on general financial principles. This value reflects the standard deductions that might be experienced by someone earning that gross income, making it the most appropriate choice among the provided options.