How much is 6 figures in salary and how to earn this much?

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by Aidan Kang, CFA

Senior Writer

Saving & Budgeting

UPDATED: October 02, 2022

No matter your current career path, one dream remains: to live a financially sound life. For many of us, this means owning a home, having multiple cars, and traveling the world. This also means achieving our dreams and securing retirement.

Most motivational pieces on the internet speak about earning six figures, but what does this really mean? Motivational speakers can make it sound so easy, but everything takes work—and that includes researching in-depth about what a six-figure salary actually looks like.

We hear you, so we’ve read reliable resources online, including sample income breakdowns, jobs you can consider, and even tips.

From this research, we’ve found the most critical factor to remember when building wealth. As you reach for the American dream, make sure to keep this extensive guide in mind—don’t skip anything!

What does “6 figures” mean in money?

In money terms, a six-figure or six-digit income means a yearly salary anywhere between $100,000 and $999,999. 

In contrast, a seven-figure income ranges from $1,000,000 to $9,999,999, and eight figures range from $10,000,000 to $99,999,999. 

A six-digit salary is what many consider a high income—and one we also aspire to achieve! To get a clearer picture, let’s take a look at this example: 

For example, you may earn a gross annual salary of $100,000. If you work the typical 40 hours weekly over 52 weeks, that’s equivalent to 2,080 working hours per year. 

Here’s a quick breakdown of how much you earn with a $100,000 six-figure salary:

• Minimum hourly income for six figures: $48.079
• Minimum weekly income for six figures: $1,923.08
• Minimum monthly income for six figures: $8,333.33

From this breakdown, we can clearly see why people are eager to learn how to earn it. It makes you feel like you’ve made it (and we’re also dreaming of the same thing!). 

Such a big paycheck can make the American Dream feel real, with a big house, multiple cars, and trips around the world. 

But, it’s important to remember that a six-figure salary isn't unlimited. Expensive things can quickly eat through your money, which is why by standards, such a lifestyle can mean different things to different people. 

Does a six-figure salary make you rich?

A six-digit salary doesn’t automatically make you rich or middle-class, as it depends on how much you spend a month. A salary of 100k and above may seem high, but some six-figure earners still live paycheck to paycheck due to their spending habits.

A six-figure can mean “rich” for some but completely average for others. People living in expensive cities like New York or Los Angeles see such a figure below average, particularly because of high living costs. Cities like Texas, on the other hand, allow you to do more.

This salary also comes with higher taxes. By the time your taxes have been deducted, you’ll only come home with approximately $70,000. 

How you can enjoy your money will depend on your current lifestyle. If you live alone, you’ll enjoy a more lavish lifestyle with a six-figure salary. But with a family, this may just be enough. 

Is a six-figure income necessary for building wealth?

Many people aspire to make six figures, but it's easier said than done. The Bureau of Labor Statistics states that the median weekly wage for Americans stands at $1,041 in 2022. That's $54,132 per year, far from the $250,000 salary we've been discussing.

So, does it signify that most people can't be financially secure? No! You can still build wealth regardless of your income. It depends more on the amount you save, which doesn’t always follow what you earn.

While many consider six figures a “successful” salary, you can still save money and build wealth with a lower income.

Your savings will accumulate over time, so you're able to build your wealth so long as you stay consistent. This means saving a portion of your salary, no matter your paycheck. Whether you earn $47,000 or $250,000, the key is not spending the entire amount on things you don’t need.

Earning a six-figure may prompt you to live a “rich” life, but this also prevents you from building a healthy and abundant retirement.

Is a six-figure salary typical across the country?

Although it can sound like a dream, earning a six-figure salary isn’t uncommon. You can work your way up the ladder, especially if you choose career paths that generally pay well. However, it’s not a trend just yet.

According to an IBISWorld 2020 report by IBISWorld, only 30.7% of Americans earn a $100,000 salary. But don’t get disheartened!

Can the average American afford the American Dream on a six-figure salary?

A $250,000 salary goes beyond the American Dream standard of success. But with a pandemic and other global crises, we believe it’s no longer enough to make the American Dream happen. 

The American Dream concept trended in the 50s—landing a promising career after education, settling down, owning a car, and ultimately purchasing a big home. 

But, with inflation and higher living costs, minimum wage earners can no longer keep up with necessary expenses like healthcare and college tuition, much less allot extra for luxury goods. 

What jobs earn the coveted 6-figure salaries?

The first step to earning a six-figure salary is typically getting the right education path. While it's entirely possible to earn six figures per year without a college degree, some people earn even more because of their chosen career paths.

Those who choose to study STEM (Science, Technology, Engineering, and Mathematics), for instance, have more chances of earning six-figure salaries. This is primarily because these fields are easier to determine regarding financial values. 

We've gathered some examples of six-figure jobs below, most of which are jobs from STEM. However, we've also sprinkled in some lucrative careers from the arts and humanities. 

Six-figure jobs that require a degree

Here are some typical six-figure jobs that need at least a bachelor’s degree:

Physicians and surgeons

You're likely already aware that those thriving in the medical field earn more than others. Investing years of learning and practicing medicine comes with substantial benefits, after all! 

From what we've gathered, physicians and surgeons in the United States earn a median annual salary of around $200,000, which means around $96 per hour.

But, if you want to take up a specialization, such as surgery or cardiology, you’ll need to invest in at least three more years.

Software developers and programmers

Software developers and programmers are in high demand with the digital age boom. These professionals are in charge of creating network systems, mobile applications, software platforms, and everything we need to thrive in the digital world. 

Software developers and programmers typically earn $103,000 a year with experience, which translates to around $50 per hour.

Marketing and sales managers

We see advertisements daily, but much work goes beyond production. Marketing and sales managers usually lead teams to develop strategies that help businesses grow and earn more. 

They deal with the day-to-day tasks of facing clients, writing briefs, analyzing media calendars, and of course, directing multiple marketing and sales teams. They also set targets and quotas, turning them into data for analysis and insights. 

With experience, marketing and sales managers usually earn an annual income of $74,000 but with a commission that can go as high as $26,000. To become a marketing or sales manager, you need a bachelor’s degree.

Lawyers

While lawyers in the US typically earn $87,012 a year on average, some experienced attorneys get an annual salary of up to $157,000, which breaks down to $75.48 per hour. The best-paid 25% of US lawyers make up to $189,520, or $91.12 per hour.

Pharmacists

Pharmacists are healthcare professionals that help handle and dispense medications prescribed by physicians. They can also educate patients about various aspects of their meds, such as side effects and dosage.

Pharmacy is a growing field, and in 2022, pharmacists in the US will make an average salary of $145,137, or an hourly wage of $69.78.

Six-figure salary jobs without a college degree

Not all six-figure salary earners have college degrees—higher education provides numerous opportunities, but it’s not a requirement to get ahead. Here are some examples of jobs that can earn six figures:

Air traffic controllers

Air traffic controllers have crucial jobs that require intense focus and training. In 2021, air traffic controllers earned a median annual salary of $138,556 or $66.61 per hour. These professionals typically have to undergo numerous training phases to earn that much.

A bachelor’s degree can help you become an air traffic controller, but it’s typically not a requirement. However, you generally must hold at least three years of responsible work experience, an associate degree, and years of training.

Real estate brokers

If you have a knack for property, sales, and negotiations, the real estate industry may be a viable career path. Indeed states that real estate agents earn a yearly average of $106,000 or $50.96 per hour. However, to earn this much, you may need years of experience in the trade.

Virtual assistants

With the rise of the digital world, remote-working virtual assistants are now thriving. They can work from any location and often enjoy flexible working hours. These jobs take on diverse tasks and often don’t require bachelor’s degrees.

While most virtual assistants don’t earn six figures, top earners get up to $108,500 annually ($52.16 per hour) with the right training and experience.

Business owners

Starting your own business is a gamble, but becoming a business owner can be a rewarding career path when you become successful. Some of the wealthiest business owners, like Facebook’s Mark Zuckerberg and Microsoft’s Bill Gates, don’t have college degrees.

That said, being a successful entrepreneur requires you to hone numerous skills and be adept at weighing risks and rewards. Even then, only a select minority of business owners earn six figures.

How can you earn a six-figure salary?

All the best things in life require time, patience, and hard work. We’re still trying to achieve the American Dream as well, and so we’ve gathered these helpful tips from reputable sources online and in real life:

Tip #1: You need to conduct self-evaluation regularly

Before building the strategy to earn more, it’s essential to step back and conduct self-evaluation. This means touching on not only what you’re good at but also your weaknesses and how each can affect your desired career path. 

By doing so, you’ll know which aspects you can focus on. You can specialize in what you’re good at while improving your weak points.

You can also consider your job preferences, followed by the nitty-gritty details such as your willingness to pursue further studies, relocate, and even switch career paths. 

Tip #2: Pursue further education 

Whether we like it or not, education and training play a significant role in your career trajectory. For many, this means investing in a university degree. For others, it could mean attending a vocational program or specialized training. 

However, remember that most six-figure paying jobs require at least a bachelor’s degree. You may want to study again if you’re looking into switching careers. It’s also worth researching the requirements necessary to land your dream job successfully.

Tip #3: Don’t underestimate networking

No man is an island, and this holds true in the industry. Experts highly recommend creating a professional network, done both online and in-person. One of the best yet simplest ways you can do this is to hop on LinkedIn and reach out to professionals. 

You can also attend seminars and other similar events, allowing you the chance to mingle with others in the same field. In doing so, you learn about new opportunities to develop new skills and vacant job roles inaccessible to the public.

Tip #4: Consider negotiating a raise 

If you currently enjoy where you are, consider asking for a raise. This allows you to earn more, especially when you work for another company. Employers will base their offer on your current salary, so it’s better to ensure you earn a little more as the years pass. 

Keep in mind, however, that doing should always be done during appropriate times. You must ensure you can vouch for your performance, supported by specific examples that warrant the pay raise.

More importantly, always show you’re willing to grow professionally. So, constantly ask for feedback and take on projects outside your comfort zone. 

Tip #5: Focus on performing well

This one’s closely tied to the previous tip. When you negotiate a raise, you need to focus on your performance. And you need to perform well, meaning that you should deliver compelling results consistently. 

This also means building good relationships with your colleagues and managers. All these make you a valuable addition to the organization, leading to more growth opportunities. 

Tip #6: Never rule out advancement opportunities

You may like where you are at the moment, but the minute a better career option comes in, take it! 

Any career paths that offer you the luxury of advancing will lead you to better salary opportunities. You may also want to leave your organization for a better-paying one—you don't always have to switch careers to earn more.

Tip #7: Consider applying for side hustles

Apart from focusing on your career, you can also increase your income through side hustles. Others add small businesses on the side, while others take up part-time roles like virtual assistance or freelance graphic designing. You will need to put in more hours, though. 

Others pursue passive income, including investing in real estate and renting out properties. 

What factors can affect your income?

Reaching a six-figure wage is a milestone worth celebrating, but remember that various factors will influence how much you can enjoy your paycheck.

There will be expenses out of your control, such as emergencies. Taxes can also significantly reduce your take-home money, so your savings and spending money may not be as high as you believe.

With these things to consider, how much is a six-figure income worth? Let's look at the different factors that can significantly reduce your earnings:

Student loan debt

Americans typically carry the burden of student loan debt. If you borrowed money for your college tuition fee, you're stuck with big repayments for years. More often than not, people invest in expensive education for a chance to land a high-paying job. 

If you're taking up medicine, for example, student loan debt can go as high as $241,000. But if you choose to study at the Western University of Health Sciences (CA), the debt can go as high as $295,999.

Your college loan debt does not disappear once you've found a well-paying job. A massive chunk of your salary funds it, effectively depleting what you can enjoy. Even with a six-figure, you may need to repay the student loan for decades. 

Credit card debt

A six-figure income may not seem like much if you constantly deal with credit card debt. If you spend most of your income paying high-interest debt, you'll have little money left over every month.

If you continue living beyond your means, a high-paying job won't matter. You'll still live paycheck-to-paycheck, unable to build the wealth you want. 

Taxes

Large portions of your earnings will go to the United States government due to taxes. The government uses this money to fund federal, state, and local projects and enhance citizens’ quality of life. Typically, you pay more taxes when you have a higher income.

Even if you earn $250,000, your take-home pay will be lower than your actual earnings. In other words, you can’t truly enjoy the amount, as post-tax income can be underwhelming.

If you live in California with a $250,000 salary, for example, tax reductions  may encompass the following items:

• Federal at 22.00%
• FICA at 7.65% 
• State at 5.97% 
• Local at 3.88%
• Retirement Contributions

From these numbers alone, expect to receive less than $200,000.

Your location

Taxes depend highly on where you currently live, as with living costs. Bigger cities like New York and Los Angeles are extremely expensive, which includes not just real estate but day-to-day necessities, like groceries. 

You also need to take utilities into account, as well as transportation. By living in a big city, your large salary may just be enough to cover your monthly needs. 

Lifestyle 

Even with so many factors coming into play, you can still live a good life with a six-figure salary. It’s still a lot of money after taxes, but you must be mindful of your lifestyle and inflation. 

You may be pressured to spend more because of your increased income, so it’s essential to live within your means—no matter how much you earn! Your next goal should be to avoid living paycheck to paycheck!

How can you build wealth without a 6-figure salary?

By now, you may not think that a six-figure salary is achievable. Or you think that it may take you a while. We still highly encourage you to pursue high-income jobs, but we've found that there are ways to build your wealth in the meantime:

Pursue multiple income streams

If you’re looking to build wealth and invest in a good financial life, you can't be satisfied with only one revenue stream. Your full-time job won’t be enough, so consider starting a business, taking a part-time job, or making passive income through investments.

If you’re planning to start a small business, consider eCommerce. Digital platforms offer ease and convenience—from attracting customers to shipping items out, you won’t have to worry as much. 

For part-time jobs, consider investing in your other skills. You may end up writing blogs for extra or perhaps making creative PowerPoint presentations. 

You can always invest in passive income if a business or part-time job seems too much! You will have to shell out costs initially, however. If you want to rent out properties, you must first purchase a property. 

Cut back on expenses

Overspending is a mistake many people make from time to time, regardless of a six-figure income. But, this pressing problem is common among those who earn more, especially if they’ve built a rather expensive lifestyle.

Unfortunately, tomorrow is never guaranteed. Anything could happen. You could lose your job, become sick, have an accident, and so on. By controlling your spending, you’ll create a safety net for when things don’t go your way. 

We don’t mean cutting back on everything, though. You have the right to own a lovely house, eat good food, and invest in comfortable transportation. You’re also entitled to frivolous spending from time to time, especially if you’ve been eyeing that new game console or expensive bag.

The key here is to limit unnecessary expenses. And by limiting them, you’ll have more to save away!

Create a long-term financial plan

If you want to reach financial success, you need to have a long-term strategy. If you lose your work or fail to save enough money for retirement, earning six figures won't mean anything.

Start by revisiting your retirement plan. Living a good lifestyle should extend well after you’ve retired, so create a financial plan to ensure you enjoy a comfortable life later on. This could mean investing in a home now, but your financial citation must always be in line with your goals.

It also means learning how to invest money to get the best possible returns. However, this requires time, effort, and patience. You’ll be doing this for your future, after all—so you won’t be enjoying the benefits right away.

If you have a spouse, keep them in the loop. Your financial plan should include the following factors:

• Children’s education
• Money retirement funds
• Mortgage for new home
• Day-to-day expenditures

Conclusion

Almost all of us dream of earning a six-figure salary. Nothing compares to the idea of finally being able to afford the lifestyle you want, but it’s not always what we expect it to be. 

That $250,000 can quickly be eaten through by tax, debt, living costs, and the lifestyle you currently have. Even with such an income, it’s important to remain strategic. 

Our recommendation? We’re still trying to learn it ourselves, but the tips above come from experts and users already living with six-figure salaries. 

The best thing to do is listen, work hard, and of course, focus on the goal. In time, we’ll live the American Dream—or at least a part of it!

Aidan Kang, CFA

Aidan has been writing about personal finance for over 6 years. Prior to this, he worked as a Corporate Finance Analyst where he specialized in Due Diligence, Company Valuations and more. He is a CFA charterholder.