Six Figure Salary Survey Results: Who’s Making $100k?
Two weeks ago I asked people with six-figure salaries to share their stories. There was a great response, and I wanted to both summarize and add to the discussion some more.
$100,000 Isn’t That Much… Is It?
Many people expressed that $100,000 is simply not very much money anymore, especially in certain urban areas like the San Francisco Bay Area. I went out to find some numbers to back this up.
Initially, I quoted a study that stated that only about 5% of individuals in the United States made more than $100,000. But if you take into account entire households instead, 16% of them nationwide earn over $100,000. However, in the San Francisco Bay Area almost twice as many households (31%) made that much. Here is a graph from Wikipedia that compares the income distribution among Bay Area households to the national level.
Having almost a third of households over the $100k mark would definitely skew perceptions. This is supported by the CNN Cost of Living Calculator, which says that earning $100,000 in Atlanta is comparable to earning $172,000 in San Francisco. Put another way, earning $100,000 in San Francisco is comparable to earning $58,000 in Atlanta.
That’s a bigger difference than I thought. Still, remember that the 16% and 31% figures are household figures. Also, the majority of the people that I know who work in San Francisco don’t own houses there. In the end, while making $100,000 as an individual may not be considered “rich” in certain areas, there is still no way it can be considered “poor”.
Who’s Making Six Figures?
Based on the completely unscientific comments, I made a chart showing the the breakdown of six-figure earners by job description. The categories were all very general, and some were very tough to pigeonhole. For example, what is a self-employed software project manager? Tech? Small Biz? Management?
What does this chart show? Really, not much with regards to specific professions. My two takeaways were that (1) there is a very wide variety of jobs that can make a healthy salary, and (2) you need a useful skillset and effort. Nobody responded that they simply moved papers back and forth, or that they coasted into their position. Everyone needed some combination of talent, passion, ingenuity, education, and hard work to get to where they are now.
Who Cares?
Really, this is not to suggest that making $100,000, or $200,000, or whatever, should the primary goal for anybody. As with many things, it is about balance. Many folks noted that they used to make more money, but now make less but are happier overall. Others noted the high debt levels and long education (and thus missed salary) that come with certain professional careers.
Also, we didn’t focus on the total compensation package, including health insurance, stock options, pension benefits, or other perks. I know plenty of lower-paid state workers that have enough years under their belts to get both guaranteed pensions and health insurance during their entire retirement. Think of how much that will be worth! This was mainly an exercise in curiosity, and I’m glad I did it.
Finally, it’s not how much you earn, but how much you keep.
February 24th, 2007 at 7:34 pm
hey jonathan -
i frequent your blog often and have found it useful more than once.
here’s something you might be interested in…if you have done any foreign transactions since last few years…check this out…and may be blog it if you wish
link
i got a similar settlement claim with my citi statement and was wondering if this works or not..
February 24th, 2007 at 7:44 pm
ha, I literally was just about to publish my post on the exact same topic. See the next post
February 24th, 2007 at 7:53 pm
this was a great little analysis that you came up with. as you mentioned, its not scientific but does give you a good indication that making a large salary is possible in MANY positions and areas of the country.
February 24th, 2007 at 8:09 pm
When using the calculator (CNN), i think they take the average person have 2 kids going to school, dog, minivan etc…
February 25th, 2007 at 8:34 am
I see the evidence of this state worker success. I know two who retired at ages 57 and 58. Pay is low but the perks keep people in the job which creates a nicer work environment too. Workers know each other for years and are not all about competing with each other. There is more friendship and working together. They aren’t all waiting for the axe!
February 25th, 2007 at 10:41 am
I’m surprised you used SF as your base for comparison.
Take a look at the CNN calculator and you’ll see that those living in Manhattan pay a further 25% HIGHER than SF prices (100k in Manhattan = 80k in SF = 46.4k in Atlanta).
Housing is almost 30% less in SF than in Manhattan, and utilities are almost half the cost.
Also, one point to consider when analysing your pie chart of professions is selection bias for your sample. People doing non tech inclined jobs might tend not to surf the internet (or blogs) as much.
February 25th, 2007 at 11:20 am
The median household income of NYC is only about $40,000, while the median household income of the SF Bay Area is $70,000. Even in Manhattan, the median household income is only $47,000. The survey was about six-figure salaries, and the SF Bay area has the highest percentage of people earning six-figure salaries in the entire country.
That, and I lived there
There is definitely selection bias on this blog. That’s why I said it’s not scientific and could not make any conclusions regarding profession. The only conclusion is that there are lots of ways to make six-figures if you pursue it.
February 25th, 2007 at 7:22 pm
As a matter of fact, most people who work in Manhattan live in New Jersey/Queens/Brooklyn/Upstate NY. As in other cities, people live away from the city center.
So, the cost of living calculator can only apply to people who live at where they work…
February 25th, 2007 at 9:22 pm
Speaking as an Atlantan, I find myself feeling a little bit richer right now.
August 22nd, 2007 at 6:43 am
I am an Indian. Let me Know how to make 100000$ per annum.
October 4th, 2007 at 9:22 am
This info would be great to share with those in our Congress who think that making 6 figure salary instantly defines you as rich. If you make $200k in SF a tax increase on your family impacts your standard of living significantly. So much for soaking the “rich.”
August 10th, 2008 at 12:41 am
I live in the suburbs(ventura county )of L.A. and 100k a year is not much…you are living slim on that amount!
February 12th, 2009 at 2:22 pm
Figured I would add to the blog.. I’m 25 in my 5th year in the banking world (Mortgage Banking to be exact). I’ve made over six figures since I was 23 and hope to continue that tread in the future. Additionally my success comes from my strong skills in sales, interpersonal relationship development and the dedication of working non stop until the job is done. 80-90 hour work weeks and sleepless nights are more common than I would like to admit; however my success is measured on how much of an impact I have on my clients and co-workers. That’s my .02 cents.
February 28th, 2009 at 7:46 pm
Great post. Money isn’t what it use to be that is for sure. Compared to these charts I’m in the wrong job field
I work as a web designer however I’m probably under paid compared to most, but just thankful I have a job.
That is a pretty amazing thing though that $100k In San Fran. is only about like earning $58k in Atlanta.
February 28th, 2009 at 8:57 pm
Interesting subject and analysis. I am a married Engineer and when I was working crappy jobs through school 2 years ago I though 100k would be all I ever needed. Now with 2 kids I will agree that 100k a year is not much at all, even in a relatively low cost of living area like Colorado. I am definitely not suffering but it should never set the threshold for rich. The company I work for maintains headquarters in Silicon Valley, CA (San Jose) and even though my equavalent position there would likely make 10-15% more, I think they are still getting short-sided. I bought a 3000 sf 4 bedroom house in 2007 for $220,000. An equavalent home in the bay area would push 600k-1M, though that was before the recent bust and your commute would be 10x longer. You are right Jonathan, it is not what you make, but what you keep. And it will get harder to keep as we ambitious people strive for more and Obama takes it away.
March 24th, 2009 at 11:56 pm
I found this after wondering just how many of those people I hear or read about making “six figures” are actually doing it. As it turns out, not that many. As a self-employed designer, my income has ranged from $65k to $98k over the past 10 years. But we live like I make $50k. We’ve been able to pay off two houses, the current one now valued at over $700k (thanks to the real estate boom) and have close to $300k in cash (in ultra-conservative CDs or similar investments). So you’re right. It is about what you keep.
May 2nd, 2009 at 9:27 pm
I would like to disagree with those in new york or san francisco that think that they are not rich. You are forgetting two things:
A) The cost of living takes into account intangible amenities like weather and proximity to desirable locations. This has to be “paid” for, so it makes sense that a San Franciscan should feel poorer from a numerical standpoint than an Atlantan. You are still taking advantage of these amenities, which you should add to your income.
B) You can always sell your house and bank your home equity, which will be more on a higher San Francisco mortgage payment than on a lower Atlanta mortgage payment. If both a San Franciscan and an Atlantan moved to Omaha, the San Franciscan would have higher standard of living.
July 25th, 2009 at 5:54 am
[...] Less than 5% of Individuals in the U.S. make over $100,000 and can still surpass the SS withholding threshold. If you count HOUSEHOLD income, then 16% earn over $100,000/year, but to surpass the SS withholding, you would need a household income of $212,000. Six Figure Salary Survey Results: Who?s Making $100k? ? My Money Blog [...]
November 4th, 2009 at 10:13 am
For those of you out there that are earning $100,000+ think about this: - Most six figure income earners work 50, 60, or 70+ hours per week to earn their so-called high status income. The real test for success is whether one can earn 100,000+ working only a standard 40-hour week. Question - is it worth the struggle to work long hours to pull down 100K especially when in most areas of the U.S. 100K is not that much money in terms of purchasing power? - So much for status.