We often come across terms like 6 figures, 7 figures, 8 figures, and 9 figures while discussing income but many of us don’t have a clear idea regarding what these figures denote. Figuring out what these figures mean is crucial while you are carrying out some research on finance or setting your finances right. So, let us find out how you can shed the frills and fancies and save for the rainy day or make your hard-earned money worthwhile.
What do 6 figures mean?
How much is 6 figures? A very pertinent question, indeed. Basically, 6 figures mean an income which has six digits. This stands for an income that begins at a minimum of $100,000 and a maximum of $999,999. Take one digit as a figure. An annual income ranging between $100,000 and $999,999 is regarded as a 6 figures income.
Why do people set a target of 6 figures income?
People feel they are on cloud nine if they earn a 6 figures income due to the following reasons:
- Can earn a dream vacation
- People quit the job they don’t like
- They can buy their dream home
- Buy high-priced products
- Can pay off their debts
- Enjoy financial liberty
- They can go for a premature retirement
- Wearing better clothes is possible
So, these are the enticements that six figures income can bring to your life.
Why do people brag about making a 7 figures income?
A seven figures income has 7 digits in it. It ranges between $1,000,000 and $9,999,999.
People boast of making a 7 figures income because it is a huge amount of money that only a handful of businessmen can earn. People making a 7 figures income are dubbed millionaires. Usually, a 7 figure salary is very rare. Only CEOs of MNCs can make such a whopping income.
What is 8 figures?
8 figures stand for an annual income of 8 digits. This ranges between $10,000,000 and $99,999,999.
How much is 9 figures?
An annual income ranging between $100,000,000 and $999,999,999 is considered a 9 figures income. 9 figures in an annual income stand for 9 digits. People earning more than this are called billionaires.
How to make a lot of money?
Now, there are many ways to make 6 figures or even more in life. People can make a lot of money through salary income, inheritance, side hustles, etc.
Normally, people consider salary income as the only way of reaching 6 figures or more. However, if you can diversify your sources of income, you can reach your goals faster. Lawyers and doctors make a lot of money. In other professions, it’s not so easy.
Is making 6 figures enough for a decent living?
Yes, if you are thrifty. No, if you are extravagant. Living in a posh neighborhood with some dependents and debts can make a 6 figures income look really meager. On the contrary, living in the suburbs singly can make the same amount of income look truly hefty.
Your effort for making money will depend on what you want in your life and how much you need to fulfill those wants. Explore ways to make extra money to reach your financial targets. Set goals for both your life and finances and also don’t forget to save your hard-earned money. With a judicious viewpoint towards money, you can achieve any goal that you have set, whether it is 6 figures or more.
How will you save for a comfortable lifestyle with a 6figure income?
If you have been pocketing a 6figure salary for quite some time now, you must have said at least a part of it by now. However, there are many such instances or examples of individuals that earn a 6figure salary but it is not enough. So, why do you land up in such a situation despite boasting of a handsome pay packet?
The answer is very simple. Having an adequate salary and not being able to save much can be attributed to your financial obligations. However, if the financial commitments make sense, it is definitely worth it.
For instance, if you are paying for your child’s education, spending on medical expenses of your loved ones or an elderly member of your household, it is not a wasteful expenditure.
But if you have been extravagant and most of your 6figure salary gets siphoned off to pay off your credit card bills, it indicates that you must sit up and rethink and rework your finances.
It implies that you have to alter your strategy pertaining to cash inflow and outflow. So, let us find out how you can shed the frills and fancies and save for the rainy day or make your hard-earned money worthwhile.
Steps to make your 6figure salary worthwhile
Remember, it is easier said than done. But if you are able to adhere to these measures, you will never regret your financial decisions ever-
Cut down on plastic card use
Having a 6figure salary is commendable but not doing justice to it is not. Using plastic cards frequently or for every expense that you incur is not a wise money spending move. Use especially credit cards sparingly.
By using a credit card, you are after all using someone else’s money that you have to return soon. And if you do not use it at all, there is no question of returning it. Use cash wherever possible. This will also curtail the expense and put a brake on what you buy.
Cut down expenses not necessary
There is a difference between what you need and what you desire. During these times when the pandemic is reigning supreme, so many people have lost their jobs. Many are struggling to make ends meet or get a square meal.
Amidst the financial catastrophe, splurging on candlelight dinners, expensive branded clothes, eating out at luxury resorts and hotels must surely make you think twice.
If there is any expense that you can defer or put off for a couple of months, do so. Spend only on what you require immediately. In other words, prioritize the expenses. Learn to segregate between essential and optional.
This approach has helped many people regardless of whether it is 6figure, 7figure, or 8figure income to save for the rainy day.
Try to wriggle out of debt
If you have any debt accounts, try to pay them off as soon as possible. If you are paying as per a payment plan, try not to fall behind on payments. Remember, your financial behavior gets reflected in your credit report. And having a good credit score allows you to enjoy several benefits socially. For instance, you will be able to enjoy better rates of insurance or any loan that you want to avail yourself in the future.
Once you are debt-free, try not to take on the additional financial burden.
Start saving early for your retirement, emergency medical expenses, and the education of your kids. If you start saving early, by the time you retire, you do not have to think about exploring avenues for earning money to meet expenses once you retire.
Keep your financial goals in writing
When you set a target for your finances, write it down in a notebook. Try to adhere, to the same at all times.
Judicious usage of cash and if you utilize your resources in an appropriate manner, it will pay-off in the long-run for you.
By following the above steps, you will be able to do justice to your 6figure salary. You not only have a lot of cash saved by then, but you enjoy financial sanity and mental peace too. Remember, your financial decisions determine your mental sanity.