For many, a six-figure salary is a pie-in-the-sky dream — a life of lavish homes, luxury services, and being able to order guac at Chipotle without worrying about the extra cost.
But is that what earning a six-figure income is REALLY like? Or does life pretty much stay the same when you add that extra zero to your paycheck?
I decided to put the question to my readers: How many of you earn over $ 100,000 a year?
The responses I got back were fascinating and provide a lot of insight into what it’s really like to earn six figures a year.
That’s why I want to share a few of them with you today — as well as give you some actionable steps for you to take in order to start earning six figures yourself.
Six-figure income insight #1: It’s no more “happy” than when you earn less.
I Will Teach You To Be Rich
The phrase “Money doesn’t buy happiness” might be cliché — but that’s only because it’s true.
In fact, a survey found that there was no discernible difference in the happiness levels of Forbes 400 executives and Maasai herdsmen in Africa.
In my opinion, what factors DO actually impact your happiness:
- Your psychology
- Your career
- Your relationships
That’s it. Those are the “Big 3” when it comes to happiness. When you’re able to take control of those three areas of your life, you’ll find happiness.
If you want to learn how exactly you can best focus on all of these areas and increase your happiness, be sure to check out my article on how to be happy.
Six-figure income insight #2: When you really want something, you let yourself get it.
I Will Teach You To Be Rich
I’m a big believer in the idea that you shouldn’t have to sacrifice the things you love in order to live the life you want. That’s why I love to hear whenever a reader is:
- Investing money in big future purchases (more on that later)
- Spending money to buy things they love
What’s the point in making money if you’re not going to use it?
The best part: It doesn’t even have to be for yourself. Give money to charity. Buy a nice gift for your parents. Do whatever it is with that money as long as it helps you truly live a Rich Life.
Speaking of which…
Six-figure income insight #3: Sometimes you can fly your friends to Vegas.
I Will Teach You To Be Rich
At first glance, this seems like a HUGE waste of money.
Why would you pay for your friend’s plane ticket with your hard-earned cash? Why can’t they pay for it themselves?
However, once you have a process in place that lets you painlessly save money while knowing exactly how much you get to spend each month, this kind of spending becomes a benefit of living a Rich Life.
It’s just a question of having the right systems in place to attain it. That’s why I want to let you in on one of the systems now: The Conscious Spending Plan.
This is the exact same system that my friend uses to spend $ 21,000 going out to the bars, clubs, and having a good time with friends.
I’ve written about it in detail before, but the quick run down of it is simple. It’s all about:
- Automating your finances
- Knowing where your money goes so you’re in complete control of the situation
Automating your finances allows your system to work for you and passively save money for whatever you want — like flying your buddies to Vegas — instead of you constantly wondering if you have enough money to spend.
At the beginning of the month, when you receive your paycheck, the money is immediately sent to where it needs to go through automatic systems that you have set up already.
Some spending recommendations for your system:
- 50% – 60% Fixed Costs: This includes things like utilities, rent, internet, and debt.
- 10% Investments: This includes your Roth IRA and 401k plan.
- 5% – 10% Savings: Here’s where you’re going to put money that goes towards things like engagement rings, weddings, vacations, and unexpected expenses.
- 20% – 35% Guilt-Free Spending: Fun money! Spend this on anything you want from nice dinners to movies.
Six-figure income insight #4: Nothing really changes — but you get to invest more.
I Will Teach You To Be Rich
Just because you start earning six figures doesn’t mean you have to start living a crazy, lavish lifestyle.
In fact, it’d be smart to start being even more financially conscious than you were before, which is why it makes me so happy that Nick decided to aggressively invest his money.
If I were to add to it though, I’d say this: There’s more ways to invest your money than in the stock market. People have this misconception that investing is a bunch of day traders screaming on the floor of the New York Stock Exchange and somehow making millions — when that couldn’t be further from the truth.
That’s why I suggest investing money in 4 different ways:
- Eliminating debt. Debt is easily the biggest barrier to living a Rich Life. That’s why it should be your first priority if you ever plan on making more money or freeing yourself of the financial and psychological burden of owing money to creditors.
- Retirement. Putting money into a Roth IRA and 401k account through your employer is one of the easiest and best ways to start earning money for retirement. The money you put in might not seem like a lot now, but when you’re ready to take it out decades down the road, you’ll be very happy you decided to start early.
- Big purchases Remember the Conscious Spending Plan? This is where it comes in. When you’re willing to be mindful of how you save money for big purchases like a down payment on a house or a wedding, you won’t have to sacrifice the things you love to do it like your morning lattes.
- Education. Your thirst for education should be constant and voracious. I don’t care if you’re reading this in your twenties or your sixties. There’s always something new to learn that you can add to your well of knowledge to draw upon. So take that improv class you’ve been thinking about or buy that course you’re interested in. It’s always worth it if you learn just one thing from it.
I go into the exact actionable steps you can use to approach investing in all four of these areas in my article on the best ways to invest in your 20s. Check it out.
The exact system to start earning a six-figure income
“Yeah, yeah. It’s awesome to earn a six-figure salary — but how do I get there??”
Many of my readers started earning six figures after leveraging the exact systems I provide on my site.
And they did it through one of my favorite ways to earn more money: Freelancing.
In fact, if you’re already making a salary of $ 50,000/year, you can easily double that money through freelancing your skills — if you’re a Top Performer that is.
Top Performers know how to find problems that keep their bosses up at night, and work like guided missiles to solve them. As a result, they can easily command double, or even triple, what everyone else earns.
Top Performers can take those skills and earn HUGE rates as freelancers — even up to six figures.
That’s why I want to show you exactly how to use those skills to start earning you money.
And the first two steps are simple:
- Find a profitable idea
- Get your first 3 paying clients
Once you’ve done that, it’s easy to scale your business.
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