Wow, wouldn’t it be awesome if you made 6 figures per year? That’s that amount that many people dream about. But how much money exactly is that?
How much is a figure?
First of all, what and how much is a figure? A figure is a numerical digit that is used to represent a number.
For instance, the number 4 is a single digit, so it is 1 figure. The number 53 is 2 digits, so it has 2 figures.
What is 6 figures a year?
Well, a six-figure income means that there are six digits in the number. Therefore, that would range from $100,000 to $999,999. That’s one hundred thousand to nine hundred and ninety-nine thousand (and change) per year.
It is just one digit away from a million dollars!
Low six figure: 100,000 to 333,333
Mid six figure: 333,334 to 666,667
High six figure: 666,668 to 999,999
How much is 5 figures?
Let’s take a step back and look at five figures; which means there are 5 digits in the number.
Most people in the world make a five-figure salary. That salary ranges from $10,000 to $99,999 per year. That means it is an income from ten thousand dollars to ninety-nine thousand, nine hundred and ninety-nine dollars per year.
Adding a dollar to the latter makes it go up a digit into the 6 figures.
What does 7 figures mean?
A seven-figure salary is a million-dollar salary.
Making a 7 figure salary means that you are making $1,000,000 to $9,999,999 per year. Similar to before, there are only 7 digits in the number. In other words, that’s an income of one million to 9 million (and change) per year.
What is an 8 figure salary?
An 8 figure salary ranges from $10,000,000 to $99,999,999. This is ten million to ninety-nine million (and change) per year.
How much is 9 figures?
A 9 figure salary has a range of $100,000,000 to $999,000,000. This comes up to one hundred million to nine hundred and ninety-nine million (and change) per year.
How much is 6 figures an hour?
A 6 figure salary has a large range from $100,000 to $999,999, so it’s hard to give an accurate amount that you might earn per hour. However, we’ll take the lowest and highest income to work off.
Assuming you work 40 hours every single week of the year (52 weeks), you would be working 2080 hours per year. That would make a six-figure salary work out to anywhere from about $48.08 to $480.77 per hour.
$100,000 per year breaks down to:
- $48.08 per hour (Annual ÷ 2080 hours)
- $384.62 per day (Hourly x 8 hours)
- $1,923.08 per week (Annual ÷ 52 weeks)
- $3,846.15 biweekly (Weekly x 2)
- $8,333.33 per month (Annual ÷ 12 months)
$999,999 per year breaks down to:
- $480.77 per hour (Annual ÷ 2080 hours)
- $3,846.15 per day (Hourly x 8 hours)
- $19,230.75 per week (Annual ÷ 52 weeks)
- $38,461.50 biweekly (Weekly x 2)
- $83,333.33 per month (Annual ÷ 12 months)
Don’t get too excited yet! We can’t forget to subtract the taxes that will be taken out. After taxes, $100,000 can be significantly reduced to $69,323 to $77,104 per year depending on the state you live in and your tax situation.
While that is still a great salary to have, it is no longer 6 figures once taxes factor in.
Your total take-home paycheck would be:
- Weekly paycheck= $1,333.13 to $1,482.77
- Biweekly paycheck= $2,666.27 to $2,965.54
- Monthly paycheck= $5,776.92 to $6,425.33
Likewise, that $999,000 salary would be lowered by taxes as well. Taking out the money for Uncle Sam, $999,999 would be brought down to $532,025 to $639,586 per year.
The new, after-tax take-home pay would amount to:
- Weekly paycheck= $10,231.25 to $12,299.73
- Biweekly paycheck= $20,462.50 to $24,599.46
- Monthly paycheck= $44,335.42 to $53,298.83
Whoa! That’s a huge difference when you take out the taxes. There is also a range because of the different amount that places take for the state tax. To make the most of your salary, you might want to live in a state that does not tax your income.
States that don’t tax wages: Alaska, Florida, Nevada, South Dakota, Texas, Washington, Wyoming, New Hampshire, and Tennessee (per Investopedia)
Making 6 figures
Many 6 figure salary jobs require venturing into fields that not many do.
How common is a 6 figure salary? According to Yahoo! Finance in 2019, only 9% of the people in America are making $100,000 or more per year. Most of these people have a postgraduate degree.
Oftentimes, higher salaries also come with greater responsibilities. It may require working your way up to a managerial role. Sometimes, it’s simply about knowing the right people and schmoozing your way into a job.
Here are the careers of a few people who are making six-figure salary:
- Payroll Accountant (Tech company)
- Web Engineer (Front End/ Back End)
- Software Engineer
- Teacher (at private institutions)
- Radiation Protection Technician
- Product Manager (Tech industry)
- Portfolio Manager
In addition to choosing the right career field, you can also make that six-digit salary by having side hustles or starting your own business. For instance, blogging (like this site) is a way that some people have made A LOT of money. Learn more about how you can make money by blogging here.
Monthly Budget for a $100,000 And Up Salary
No matter how much money you make, it’s still important to keep track of the money you have coming in and going out.
For people like me who aren’t even close to making 6 figures a year, it doesn’t seem like it would be hard to budget that much money. However, there are some people making that much money and more who are living paycheck to paycheck. Yes, you can make six figures and still be broke because of:
- Not budgeting
- Creating unneeded expenses
One mistake that people make is increasing their cost of living to match their salary. On the other hand, the path to financial security is to save more instead of spending more.
Now, here is an example of how I would budget with that salary. For this budget breakdown, I will use that higher-taxed monthly income of the $100,000 salary. I’ll be working off of $5,776.92 per month for a two-person family. As always, save first and foremost!
- Savings of 20% = $1,155.38
- Rent/ Mortgage= $1,925.64 (⅓ of income)This is the most you should pay per month but it’s best to aim lower.
- Utilities= $300
- Car Payment= $250
- Car Insurance= $100
- Health Insurance= $300
- Cellphone= $100
- Internet= $50
- Gas= $60
- Groceries= $400
- Personal & Misc= $200
- Entertainment= $100
- Total = $4,941.02 with $835.90 leftover
If you’ve seen any of my other budget breakdowns, you might notice these amounts are pretty much the same. Why? Because I would prefer to save that extra money that I’m making to invest and create a good retirement fund.
In my budget grocery list for two, I only spend about $200 per month for groceries. I already eat mostly organic foods, so I would use the extra money to start buying all organic fruits, vegetables, and meat.
How to Live $100,000 a Year
Just because you make six figures, that doesn’t mean you have to live a 100k a year lifestyle. To live a financially secure lifestyle, the most important thing is to live below your means.
The 4 main steps to being financially secure with your income are to:
- Create a budget: Learn how to create a simple budget here.
- Save money: Remember, save first then spend.
- Lower your expenses: Here are 40 frugal living tips that I live by.
- Pay off debt fast: Paying the minimum results in crazy interest fees. Fast track your debt payoff by doing these things.
Learn more tips with my guide: How To Live On A Budget.
- $60,000 a Year is How Much an Hour?
- $40,000 a Year is How Much an Hour?
- $30,000 a Year is How Much an Hour?
- $15 An Hour Is How Much A Year?
It can be a lot of money if you budget and spend it well. Otherwise, you can end up in the same financial trouble at any salary.