Making $100k a year might seem like a dream, but it’s actually doable if you make smart choices along the way. Being able to focus on your goals, pursuing the right opportunities, and educating yourself are key to increasing your income.
Here are four ways to start building a six figure income, no matter what you do or where you’re starting.
Pick the Right Career
Some careers are obviously much better paid than others. Lawyers and physicians both make median salaries that are well over $150,000 a year. Of course, these careers also come with high education price tags and lots of years invested.
If that’s not for you, consider this: According to Monster.com, a number of low-stress jobs (many of which don’t require an advanced degree) also pay over $100,000 a year.
These include careers like actuaries, curators (for everything from museums to botanical gardens), economists, geologists and marketing managers. Some surprising well-paid careers include mathematicians (especially those working at government agencies and those holding an advanced degree) and nurses. Keep in mind that most of these careers might not require advanced degrees but they do focus on experience and industry growth – meaning it might take a few years before you get a salary of at least $100k.
Other careers, like finance careers, are more likely to get you to that magic number much faster after graduation. Investment banking, strategic consulting, IT services, and high-tech fields all are likely to pay around the $100k mark once you have as little as a couple of years of experience.
Move to a State with Better Salaries
No matter what career you’re pursuing: some states just pay better for anything you do than others.
According to information based on the Census ACS survey results, the District of Columbia has the highest median household income in the country at $82,604. This is an interesting number since Washington DC also has a poverty rate of 15.5%. Still, high income from certain areas drives up the average income, with the high end median reaching an impressive $134,358.
Maryland comes a close second with a median household income of $81,868, plus an interesting position as the state with the second-highest percentage of degree holders (right behind New Hampshire). New Jersey, Hawaii, Massachusetts, Alaska, Connecticut, New Hampshire, Virginia and California complete the top 10 list of states with the higher salaries.
Of course, cost of living plays a role too. Salaries in California are high but the state is also the second most expensive state to live in – a place where the average home price is over $1.2 million and your monthly energy bill will set you back $237 (more than in NY and barely less than in Alaska). In fact, California, Hawaii, and Massachusetts are the three most expensive states to live in, so even a high salary won’t go very far there.
Other states, like Alaska, might be expensive but offer tax benefits (like no taxes on personal income –which means that you get to keep a lot more of what you earn). Plus you’ll still earn a lot closer to $100,000 in Alaska than in other states.
Get a Second Degree
Graduate degree holders earn an average $17,000 more per year than people with “just” a Bachelor’s degree.
The difference is more noticeable in some career fields, where master degrees are more likely to get you a promotion, better positions, and a higher income.
For example: the median annual wages for somebody with a bachelor’s degree working in finances is $73,000 but that amount goes up to $101,000 (a $28k increase) for people with an advanced degree. Education is another field where an advanced degree pays off big and those with a Master’s degree earn as much as $89,500 a year or about 19 percent more than those with just a Bachelor’s.
On the other hand, people working in the food science field only earn about $10,000 more by obtaining a master’s.
For those considering going back to school, it’s worth sitting down and doing some math. Weighing in the costs of a degree against long-term earnings is a good way to decide whether the investment is worth it.
Have More Than One Stream of Income
Bestselling author and motivational speaker Thomas C. Corley, who spent five years studying millionaires and how they made their fortune, concluded that “Self-made millionaires do not rely on one singular source of income. They develop multiple streams.”
Even if your goal is not to earn a million but “just” $100k a year, this advice still holds true. Corley’s studies show that “65% of self-made millionaires have at least three streams of income,” with some having as many as five. These are usually a combination of a main income (usually a salaried job) with things like profits from selling and buying, rentals, dividends from stocks, and residual income (such as selling subscriptions or receiving royalties).
For those without additional streams of income, an easy way to get started is with a side hustle. According to research conducted by personal-finance company Bankrate, almost 45 millions Americans had a side hustle in 2019, with the average hustle income bringing in over $1100 per month.
While many workers are using the extra money for basic living expenses, others are saving or investing. Plus, interestingly enough, many are pursuing a side hustle that’s related to a hobby or a passion of their own. According to Bankrate, “more than one-quarter (27%) say they are more passionate about their side hustle than their main job/career.”
The key to transforming that small side hustle into a steady income revenue? Entrepreneur says it’s all about treating it as a business and having a plan for financial stability. This could mean putting vacation plans aside for a while so you can use your free time to earn more and grow your business.