I became fascinated by “6-figures” many years ago when I attended a business meeting that turned out to be a multi-level-marketing presentation. On the whiteboard was written, this is how you get to 6-figures.
No it wasn't. Other than the presenter, I don't think that's how anyone in the room ever got to six figures.
You may have seen a similar presentation for a business opportunity, or heard of people online earning six figures and wondered what they were talking about. Why is it such a big deal and what does it really mean?
In this article, I'm going to explain what six figures is, why it matters, and discuss some of the things you can do to make six figures too.
How Much is a Six-Figure Income?
A six-figure income is the amount of money you would earn if your salary was $100,000 per year or more, and less than $1,000,000 (7-figures).
You may have heard of low, mid, or high six-figure incomes, and while there are no rules written in stone, a low six-figure income generally refers to someone who makes between $100,000 and $399,000.
A mid-six-figure earner would bring home between $400,000 to $700,000 per year, and anything between $700,000 and $999,999 would be considered high-six figures.
As you can see, your lifestyle on a low six-figure annual income would be dramatically different than if you were making a high-six-figure annual income.
In fact, depending on where you live, a low six-figure income might not go very far at all. If you're in debt, have a family to support, and the cost of living is high, you can still find yourself living paycheck to paycheck on a six-figure salary.
That doesn't mean it's not a good income.
How Much Per Hour is Six-Figures?
If you were paid by the hour, you would need to make at least $48.08 per hour to earn six-figures, assuming you worked a 40-hour workweek for a full 52 weeks per year.
Of course, if your job offers you a lot of overtime hours and/or bonuses, you might be able to earn significantly less per hour and still end up with $100,000 or more at the end of the year.
Just to keep it real, you can make as much as $192.30 per hour and still be considered a low-six-figure earner. The math looks like this…
$192.30 x (40 hours x 52 weeks) = $399,984.
There aren't many “jobs” that pay $192.31 per hour.
Somewhere between $192.31 and $336.53 per hour will put in the mid-six-figures, and $336.54 to $480.76 an hour in the high-six-figures.
But who's counting… 😃
Why Does Six Figures Matter?
There's something magical about a six-figure income. It's a milestone. An achievement.
Sure, it's an arbitrary number but let's be honest. There is a certain “status” and pride that comes along with telling people you earn six-figures a year.
Not that you would tell people about it. Just knowing it feels good.
It sets you apart from everyone earning a five-figure salary ($10,000 – $99,000), which is what most of your friends and family probably make… statistically speaking.
Six figures feels like an income that matches your potential, right? An income you're not “settling for”.
It puts you among the top ten percent of all earners in the US.
There's nothing wrong with being proud of the money you make. It shouldn't define you of course, and it certainly doesn't mean you're a better person than someone who makes less. But for better or worse, in this world… money is a measure of success.
It's quantifiable. A way to gauge how hard you've worked to achieve what you've achieved. And it's okay to be proud of that.
How To Make Six Figures
First, it's important to be clear that making six-figures, and making six-figures per year, are two different things.
You can work two jobs for a year and make six figures once, but it might not be sustainable. You can budget for several years and save six-figures.
You can also sell something you own to make six figures.
You can inherit money, have a good year on your investments, write a book that sells for six figures, or even win a lottery.
Maybe a combination of all the above.
But earning six figures per year, year after year, is something different entirely.
The most obvious way to make six figures is to get a high-paying job. It's not the only way, but it's the most common, so I'll start with that…
Jobs That Pay Six-Figure Salaries
Unfortunately, most jobs pay less than $100,000, but not all of them. Many start out well below six-figures but after years of experience and a series of promotions, have the potential of breaking through that magical threshold.
If you're young, still planning your future, and determined to earn a six-figure salary… choose wisely.
I wish I could go back in time and make better choices, and if you're a little older like I am, you probably know what I mean.
Six-Figure Jobs (With a Bachelor's Degree or Higher)
Generally speaking, the highest-paid professions require the highest levels of education. There are ways you can fast-track your way to a hundred thousand dollar income which I'll talk about in a moment, but if you're following the traditional path (go to school and get a job), you'll have to pay your dues in the classroom.
Here are ten of the best high-paid professions.
- Anesthesiologists (Doctorate) – $261,730 (avg)
- Orthodontists (Doctorate) – $230,830 (avg)
- Psychiatrists (Doctorate) – $220,430 (avg)
- Dentists (Doctorate) – $183,060 (avg)
- Petroleum Engineers (Bachelor's Degree) – $156,780 (avg)
- Financial Managers (Bachelor's Degree) – $147,530 (avg)
- Lawyers (Master's Degree) – $145,300 (avg)
- Pharmacists (Master's Degree) – $125,510 (avg)
- Aerospace Engineers (Bachelor's Degree) – $119,220 (avg)
- Electrical Engineers (Bachelor's Degree) – $106,240 (avg)
Six-Figure Jobs (Without a Bachelor's Degree or Higher)
While you don't always need a Bachelor's, Master's, or a Doctorate for the jobs below… they do require you to be skilled at something. Contrary to all the scams, schemes and fake guru's out there, earning six figures per year doing unskilled tasks or labor, is extraordinarily difficult.
It's your skill that's in demand.
So, for these jobs, you will need some form of training such as an Associate's degree or a Trade from a community college or technical school, as well as experience (in some cases, years of experience) before you are comfortably earning six figures a year. And in no cases should you expect to be making that kind of money to start.
Also, some employers in these fields may require a higher education even though the occupation itself does not. In some cases (such as construction and sales for example), experience and seniority can make up for a lack of education.
A Bachelor's Degree or higher in a related field will most likely increase your chances of landing one of these positions.
- Airline Pilots (Flight School + min 250 hours of flight time, some college may be required) – $174,870 (avg)
- Sales Manager (Sales Experience) – $144,660 (avg)
- Purchasing Manager (On-the-Job Experience, some college may be required) – $128,400 (avg)
- Air Traffic Controller (Associates Degree) – $120,140 (avg)
- Personal Service, Entertainment and Recreational Managers (Associate's Degree) – $118,710 (avg)
- Construction Supervisor/Manager (Trade Apprenticeship Program, Associate Degree and Field Experience) – $106,240 (avg)
- Dental Hygenist (Associate's Degree) – $100,000 (high end)
- Elevator Installer/Repairer (Trade Apprenticeship Program) – $100,000 (high end)
- Real Estate Agent (High School/GED and Meet Local Licensing Requirments) – $100,000+ (high end)
- Industrial Electrician, Plumber, Instrumentation Tech, Heavy Duty Mechanic, etc. (Trade Apprenticeship Program) – $100,000+ (high end running your own business or working in the industrial sector)
Making Six-Figures Without a Job
The second most common way to make six-figures a year is to be a business owner. Rather than spending years in school, this is one way you can fast-track your way to the big bucks.
You can start a home-based business such as wedding photography, landscaping, house-cleaning or mobile car detailing.
The opportunities are endless.
Owners of restaurants, salons, automotive repair shops, and jewelry stores can also earn a hundred thousand dollars or more per year.
An online business is also an option, and skilled freelancers can make six figures a year.
Of course, there are rare outliers like professional athletes, authors, artists, and actors that make six, seven and in some cases, eight figures per year.
Let's not forget the politicians, lol.
Then there are the unique earners you may have never thought of, for example, a 25-year old who makes six-figures on Twitch playing Chess, and a 24-year who turned their art side hustle into a six-figure income.
Who Earns Six-Figures a Year?
According to Yahoo! Finance, approximately 9% of Americans earn $100,000 or more per year.
In addition to the jobs listed above, as well as business owners, freelancers, athletes, and so on, here's a list that includes 100(ish) occupations from the U.S. Bureau of Labor Statistics that pay a 6-figure salary.
There are some surprises here actually. For example, I did not know that the average annual salary for lawyers was higher than the average annual salary for judges. If I had to guess, I'd say it's probably a percentage of extremely well-paid lawyers that are pulling up the average.
I was also surprised by the average income reported by sales managers and purchasing managers. I have a background in sales and management, and things must have changed in the last decade or so because no company I've worked for paid the kind of money listed here.
But according to the U.S. Bureau of Labor Statistics, this is who is earning six-figures a year:
|Occupation||Avg Annual Salary|
|Surgeons, Except Ophthalmologists||$252,040|
|Oral and Maxillofacial Surgeons||$237,570|
|Obstetricians and Gynecologists||$233,610|
|Family Medicine Physicians||$213,270|
|Physicians, All Other; Except Pediatric||$203,450|
|General Internal Medicine Physicians||$201,440|
|Dentists, All Other Specialists||$178,040|
|Airline Pilots, Copilots, and Flight Engineers||$174,870|
|Computer and Information Systems Managers||$156,390|
|Architectural and Engineering Managers||$152,930|
|Natural Sciences Managers||$145,450|
|Advertising, Marketing, Promotions, Sales, and PR Managers||$143,330|
|Judicial Law Clerks||$143,200|
|Operations Specialties Managers||$134,550|
|Compensation and Benefits Managers||$134,210|
|Public Relations and Fundraising Managers||$132,630|
|Astronomers and Physicists||$130,110|
|Law Teachers, Postsecondary||$129,950|
|Human Resources Managers||$129,570|
|Judges, Magistrate Judges, and Magistrates||$128,550|
|Computer and Information Research Scientists||$127,460|
|Training and Development Managers||$123,470|
|General and Operations Managers||$123,030|
|Computer Hardware Engineers||$123,030|
|Health Specialties Teachers, Postsecondary||$121,620|
|Air Traffic Controllers||$120,140|
|Personal Financial Advisors||$119,290|
|Economics Teachers, Postsecondary||$119,160|
|Personal Service, Entertainment and Recreational Managers||$118,710|
|Medical and Health Services Managers||$115,160|
|Industrial Production Managers||$115,110|
|Computer Network Architects||$115,110|
|Education Administrators, Postsecondary||$112,400|
|Engineering Teachers, Postsecondary||$112,110|
|Physical Scientists, All Other||$112,070|
|Software Developers and Software QA Analysts and Testers||$111,620|
|Electronics Engineers, Except Computer||$110,210|
|Architecture Teachers, Postsecondary||$110,040|
|Geoscientists, Except Hydrologists and Geographers||$108,350|
|Biochemists and Biophysicists||$108,180|
|Software and Web Developers, Programmers, and Testers||$106,980|
|Administrative Services and Facilities Managers||$106,550|
|Business Teachers, Postsecondary||$105,440|
|Information Security Analysts||$104,210|
|Air Transportation Workers||$104,130|
|Transportation, Storage, and Distribution Managers||$103,320|
|Atmospheric Teachers, Postsecondary||$102,690|
|Earth, Marine, and Space Sciences Teachers, Postsecondary||$102,690|
|Healthcare Diagnosing or Treating Practitioners||$102,470|
|Engineers, All Other||$102,460|
|Political Science Teachers, Postsecondary||$102,290|
|Physics Teachers, Postsecondary||$101,110|
|Nuclear Power Reactor Operators||$100,990|
|Data Scientists and Mathematical Science Occupations, All Other||$100,560|
|Education Administrators, Kindergarten through Secondary||$100,340|
|Administrative Law Judges, Adjudicators, and Hearing Officers||$100,230|
Source: U.S. Bureau of Labor Statistics
Despite the large number of jobs that pay one hundred thousand or more per year, the majority of Americans (and the world) earn significantly less.
And it might get more difficult.
According to Bankrate, nearly a quarter of Americans claim to be worse off than they were before the Great Recession in 2008. And that was before the pandemic of 2020.
And, although in some cases the younger generations have been doing better than older generations on a per/year income basis (4% of Millenials say they make $250,000 versus 3% of Gen X-ers and 1% of Boomers), there are significant challenges ahead.
Artificial intelligence, automation, and innovations such as 3D printing and Virtual Reality will all put downward pressure on the employment market and force some people out of work entirely.
Living a Six-Figure Lifestyle
Can you live comfortably on six figures?
This should be a no-brainer, the answer is obviously yes, right? Well, it's not that simple. Where you live, what your expenses are, and how much debt you have will determine your lifestyle on a hundred-thousand-plus paycheck. And what's your definition of “comfortable?”
A one-income family in an expensive city, even if six-figures, might struggle each month.
And of course, there's a big difference between low-six figures, mid-six figures, and high-six figures.
If you bought your home when the interest rates were low, you might be doing well now. But what if interest rates go way up and the value of your home sinks?
Is that BMW or Mercedes really that much better than a Toyota Camry? Because as far as “comfort” goes, a new Toyota Camry is pretty damn comfortable I think. It might not come with the status and style you're after, but it's still a very nice car.
And the same goes for clothes you wear and whatever else you spend your money on.
Are you buying a new car every two years, or buying a two-year-old car and keeping it for ten?
A six-figure salary for one person can lead to very early retirement with big investments and savings, while another person might be living paycheck to paycheck for the rest of their lives.
Six figures doesn't go as far as you might think. In fact, a six-figure salary isn't really six figures. Not when you consider taxes.
Six-Figure Salary Taxes
The current tax rate for a single person earning between $85,526 and $163,300 is 24% so that $100,000 you made last year is really just $76,000 in your pocket.
Then you have local taxes which include property and payroll taxes as well as sales taxes and licensing fees.
You may also have a hefty health insurance bill if you live in the U.S.
At the end of the day let's say your after-tax (net) income is $60,000. Divide that by 12 months and your six-figure income is now just $5,000 per month.
That's still pretty good, but it's not the “six-figure lifestyle” you might have imagined.
In addition to taxes, the U.S. and most of the world are going through an affordability crisis, which explains why an estimated two in five adults say they would struggle to come up with $400 in an emergency, and one in five adults is unable to pay their monthly bills in full.
The cost of living is going up. Housing prices are out of touch with reality in most cases, and even if you don't own your own home, those high prices are reflected in the cost of rent. Health care costs in the U.S. keep rising, as do student loan debts, child care, and food.
Life creep catches most people off guard. As your income rises, what were once luxuries become necessities. You buy a bigger home, a nicer car and you eat out more often.
I can't count how many times my wife and I wonder at how we survived just fifteen years ago on what was maybe a quarter or less of what we earn now. And to be honest, I think I felt more secure than I do now even though our financial situation is significantly better.
It's because our expenses are so much higher.
We allowed lifestyle creep to change our standards. Even though we still live modestly, from the neighborhood we live in, to the cars we drive and the food we eat… it's a much different lifestyle than we used to live.
Lifestyle creep can (and probably will) add stress to your life as you struggle to maintain your current standard of living. You might make a lot more in the future, but that doesn't mean you'll be sitting on extra cash.
In addition to that, your fear of losing that six-figure salary is much stronger than your desire to achieve it in the first place. They might both keep you up at night, but in very different ways.
If you can maintain the same level of expenses and expenditures as your income rises, you'll avoid the stress that comes along with lifestyle creep and appreciate your six-figures a lot more.
Do You Need a Six-Figure Salary to Build Wealth?
Even though six-figures doesn't go as far as it used to, you can still build wealth without it. It just depends on whether you want to pretend to be wealthy now, or if you want to actually be wealthy later.
There's no secret or magic formula to building wealth. In fact, it can be boiled into a single sentence; you must spend less than you make and save or invest what's leftover.
A few weeks ago I took my Mom for a drive. It was to a neighborhood close to the ocean where family friends used to live, and the average price of a detached home is $3 to $3.5 million.
Think of that…
Even if you saved a full $100,000 each year, after all your living expenses and taxes… it would still take you 30 to 35 years to pay off a three to three-and-a-half million dollar house.
And the thing that stood out to me is this…
The cars, trucks, and SUVs parked out front and in the driveways of most of these homes were not Porsches and Ferraris. They were ten years older than the cars I own. And they were not luxury models.
Sure, there were some expensive cars and SUVs, but most were older Subaru's and Honda's and there was the odd Dodge Journey and Ford Escape.
In other words, most of the people who own these big houses near the ocean are more concerned with building actual wealth than they are pretending to be wealthy.
My neighborhood, where the cost of a home is significantly less, is where you find far more Beamers, Porsches, and Teslas. Go figure. 🙄
Start with a budget. If you don't plan have a financial plan, you're doomed. You must know where your money is going before you can get control of it.
The trick is finding a budgeting system that works for you. Some people prefer to create their own spreadsheets instead of using a budgeting app, which may be simpler but more restrictive. Or, the cash envelope system might be your thing.
You can also go old-school and buy a notebook. Believe it or not, people did budget their money and build wealth before computers. 😉
Write down your savings goals, and if you have a partner, communicate them. If you and your partner are not on the same page regarding your finances you're more likely to coast month to month without making any real progress.
Decide what matters most. If a five-dollar latte every morning is important to you, that's okay. Is there something else in your budget you can bend on? One less family outing per month might easily pay for your morning java.
Brewing your coffee at home every day will pay for that family outing, pay off debt faster, or add to your savings…
Savings and Investments
To build wealth without a six-figure income requires savings and investments. Those two topics are obviously beyond the scope of this article, but again… like budgeting, decide what it is you want and how long you can wait for it.
Extreme savers in the FIRE Community (Financial Independence and Early Retirement) often give up living on their own, meals out and personal transportation to save as much as 50% or more of their income because they've decided that what they want is to retire early.
They can wait for the car and the house.
And even though your lifestyle might no be as big as you want now, your stress levels will be infinitely smaller knowing you have savings in the bank and that your needs are small.
Time and Patience
Once you've set your financial goals and budgeted to achieve them, your most important asset is time and patience.
It's not easy. Our consumption culture is working against you. In fact, your thirst for more might be what brought you to this article in the first place. But time and patience are your friends, and they are absolutely essential to building wealth… even if you have a six-figure income.
Start Your Side Hustle
Reducing your expenses by budgeting and saving is only half the battle. The other half is to increase your income. Depending on your occupation, that might be possible with your job, but another way to do it is by starting a side hustle and generating multiple income streams.
And it doesn't have to be fancy…
You can walk dogs on weekends, or buy stuff locally and sell it online. You can do freelance work, drive for Uber and even deliver pizzas.
You want to make money and build wealth and there's never been a better time to do it. You can literally do it without leaving your home…
It might take time and it won't be easy (at least nobody credible will tell you it's easy), but if you're a student in school, a single parent at home or have a medical issue that make regular work difficult, an online business may be what you want.
With all the scams and schemes out there though, knowing how and where to get started the right way is what you need in order to get what you want.
To be clear, these are far away from six-figures (like, NOT even close), but sites like Inbox Dollars which offers rewards for doing things like watching videos, visiting websites and searching the web, and Survey Junkie, are a good way to get started if you've never made a single dollar online before.
And whether it's a new career, going back to school, or starting a side gig, there's no time like today to get started.