Very high earners ($400k+), how did you do it?

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Williams57
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Re: Very high earners ($400k+), how did you do it?

Post by Williams57 »

jharkin wrote: Mon Nov 29, 2021 11:41 am As expected, the answer in the responses are pretty typical:

Executive management
FAANG software developers
Finance
Medicine (MDs - nurses and techs are not getting rich)
Law
Successful small business owner
etc.....


Keep in mind that getting to these levels typically requires a consummate level of education and time investment. Any job that pays that kind of money without extreme commitment levels is probably a sign of an industry in a bubble.

To be more actionable - I would also ask the question I usually do in these kind of threads - WHY do you want/need 400k? Is it just to hit a number for the sake of a number, or is there some way it would really bring you more life satisfaction? I am sure I don't need to repeat all the studies that show earning beyond 75k or so doesn't make people statistically happier. On a personal level I find that even living in a HCOL area, beyond about 200-250k household income its actually hard to find ways to spend it all unless you are the type to pay somebody to do literally everything around the house, eat out every meal, and have to always have the newest latest and greatest of every device, gadget and consumer good.

And at the risk of getting us off track, as somebody hinted way up thread, paying people 400k, 500k, 1MM for these roles is not really doing anything for society, but is definitely a big part of why your iPhone costs $1000 rather than the $50 it cost to make it. Or why your active mutual fund charges 1% instead of the .005% Vanguard does. Or why going to the hospital can bankrupt you. etc.
I am nowhere near that, but charity is big for me. You can help a lot of people and a lot of different causes.
MaxDakota
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Re: Very high earners ($400k+), how did you do it?

Post by MaxDakota »

[/quote]

Yup, it's because this board is fairly conservative and starting a business is too risky for most here. I started my biz over a decade ago (now own two). Best thing I ever did for my financial life. Yes it's hard to start and there is certainly survivorship bias but in my experience most of the other successful business owners I meet are just simply really good at what they do. The ones who usually fail...aren't.

In any case it's allowed me to have a very high income without having to live in some super expensive area like SF or NY. A dollar goes a lot farther in the upper midwest.

I've said it many times but the best way to generate real wealth is to work on your sweat equity, not your stock equity. You have way more control over the former. Way too much hand wringing here about slicing and dicing portfolios, and not enough about how to increase your human capital.
[/quote]

Echoing all of this. We started our business in our 20s, were millionaires within 3 years, and still out earn our sizable portfolio, which is itself growing at an astonishing rate. Of course, it required an original business idea, appetite for risk, and incredibly long hours in the beginning. We still work hard now, but it’s all ours, and it’s down to 50-60 hours a week which we enjoy.

Good to see other business owners on here, I was going to say the only downside is no one else does what we do, not even our direct competition, so while that makes our business very secure, it’s also a bit isolating.

Disagree with PP who said business owners don’t have to be very smart, just hard working. To the contrary, I find that successful business owners are incredibly smart, resourceful and strategic, after all, we have to wear all hats! Above all else, successful business owners are consummate problem solvers.

So OP, start a business. The only people I know that out earn business owners are those that have made it to MD/Partner in PE, and that’s a hard road with compensation tied up for many years.
Gus Chiggins
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Re: Very high earners ($400k+), how did you do it?

Post by Gus Chiggins »

Spouse is a Director (in corporate finance) for a large tech company. Target compensation (i.e. salary, cash bonus, annual stock grant) is roughly $500K.
fortunefavored
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Re: Very high earners ($400k+), how did you do it?

Post by fortunefavored »

MaxDakota wrote: Mon Nov 29, 2021 12:00 pm So OP, start a business. The only people I know that out earn business owners are those that have made it to MD/Partner in PE, and that’s a hard road with compensation tied up for many years.
Or you could be like my uncle, who started at least 3 businesses over 30+ years. Some were very successful for periods of time.. all lead to bankruptcy.. and eventually personal bankruptcy and divorce. He ended up working a (low) salary job until he passed away.

I stuck to W2 jobs, learning from his example. :)
alfaspider
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Re: Very high earners ($400k+), how did you do it?

Post by alfaspider »

MaxDakota wrote: Mon Nov 29, 2021 12:00 pm
So OP, start a business. The only people I know that out earn business owners are those that have made it to MD/Partner in PE, and that’s a hard road with compensation tied up for many years.
I think that's a bit overbroad. There are business owners who never earn a dime from their business and ones who are triple digit billionaires now. It's fair to say that your upside is limited if you are not a business owner (probably low seven figures is about as much as anybody out there makes without a pretty significant role in running a business), but $400k is realistic as an employee if you have a high-end skillset. I'd say a Partner in PE is a bit of a hybrid between an employee and a business owner. They may not have started the business, but they are a part-owner and typically play a pretty key role in managing the enterprise.

I think there are different personalities at play. Some folks are going to be better at being an individual contributor or otherwise working within an institution than starting a business. I know plenty of people who are brilliant within their subject matter, but would struggle mightily to handle the administrative aspects of business ownership effectively. I know some great lawyers at large firms making seven figures who would never get a bill sent out to a client (let alone actually collect on one) if there weren't an administrative apparatus in place to make sure that sort of thing gets done.

Separate from the administrative side, a small business owner needs to be able to sell. Even if the business does not involve selling direct to customers, you need to be able to sell to get financing, get a good deal on a contract, and even to attract good employees. Not everyone has a personality for sales.
ScaledWheel
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Re: Very high earners ($400k+), how did you do it?

Post by ScaledWheel »

I'm an individual contributor (IC) in tech, which is a career I started after getting a PhD in STEM. This is definitely not the fastest way to a good salary, but I enjoyed the intellectual independence I got from doing grad work :happy

As others have mentioned, you will see a lot of people in tech in this thread. The reasoning being that, in most of tech, there is a very low to zero marginal costs to serving another customer. As such, revenues and profits per employee are quite high [see 0].

Someone upthread made the comment that no one should make 400k+ a year. But with the top tech companies being as efficient as they are, the only option is for the money to go to investors, and I'm happy that the employees get exposure to the company upside via RSUs. My opinion is of course heavily biaed :D


[0[ https://www.visualcapitalist.com/top-20 ... -employee/
TheHiker
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Re: Very high earners ($400k+), how did you do it?

Post by TheHiker »

jharkin wrote: Mon Nov 29, 2021 11:41 am On a personal level I find that even living in a HCOL area, beyond about 200-250k household income its actually hard to find ways to spend it all unless you are the type to pay somebody to do literally everything around the house, eat out every meal, and have to always have the newest latest and greatest of every device, gadget and consumer good.
A few years ago I was trying to get a mortgage for a small house in a VHCOL area with an income in the 200-250k range, but was laughed out of the bank.
Had to get that 400K+ job just to qualify for a mortgage. Sigh.
alfaspider
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Re: Very high earners ($400k+), how did you do it?

Post by alfaspider »

London wrote: Mon Nov 29, 2021 11:11 am
Firemenot wrote: Mon Nov 29, 2021 11:04 am
grkmec wrote: Mon Nov 29, 2021 10:39 am Nearly anything in private, hedge funds, investment banking, sales / trading with 5-10 years out of school should get you >$400k.

My wife is a managing director at a large private equity firm and she is hiring kids with 2yr banking experience and/or straight out of college with total compensation ranges >$200k to start which can easily double in 2-3 years if they perform and get promoted to VP.
It’s interesting how the title of “VP” means so little in some industries. In my industry it takes decades to get up to VP and means you are just outside C-suite of a major multi-national.

The structure in banking is generally (highest to lowest)

Partner (Goldman)
Managing Director
Director
VP
Associate
Analyst
No title
Banking/Finance is kind of unique with its tiles and the proliferation of mid-level employees with "VP titles. At my F500, the tier is:

CEO/CFO/CLO/SVP Operations (effectively the COO, but with a SVP title)
VP (all report directly to the C-suite and many are corporate officers such as Treasurer/Controller, etc.)
Director (there are very few of these, and many report to the C-suite rather than a VP)
Manager
Supervisor
Individual contributor (Comp, title, and seniority can vary wildly, as some ICs can have a pay grade equivalent to Manager/Director- higher end ones will report to Directors or higher)
stoptothink
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Re: Very high earners ($400k+), how did you do it?

Post by stoptothink »

ScaledWheel wrote: Mon Nov 29, 2021 12:59 pm I'm an individual contributor (IC) in tech, which is a career I started after getting a PhD in STEM. This is definitely not the fastest way to a good salary, but I enjoyed the intellectual independence I got from doing grad work :happy

As others have mentioned, you will see a lot of people in tech in this thread. The reasoning being that, in most of tech, there is a very low to zero marginal costs to serving another customer. As such, revenues and profits per employee are quite high [see 0].

Someone upthread made the comment that no one should make 400k+ a year. But with the top tech companies being as efficient as they are, the only option is for the money to go to investors, and I'm happy that the employees get exposure to the company upside via RSUs. My opinion is of course heavily biaed :D


[0[ https://www.visualcapitalist.com/top-20 ... -employee/
Outside of professional athlete or other entertainer, what exactly is a faster way to "a good salary" then IC in tech?
ScaledWheel
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Re: Very high earners ($400k+), how did you do it?

Post by ScaledWheel »

stoptothink wrote: Mon Nov 29, 2021 1:08 pm
ScaledWheel wrote: Mon Nov 29, 2021 12:59 pm I'm an individual contributor (IC) in tech, which is a career I started after getting a PhD in STEM. This is definitely not the fastest way to a good salary, but I enjoyed the intellectual independence I got from doing grad work :happy

As others have mentioned, you will see a lot of people in tech in this thread. The reasoning being that, in most of tech, there is a very low to zero marginal costs to serving another customer. As such, revenues and profits per employee are quite high [see 0].

Someone upthread made the comment that no one should make 400k+ a year. But with the top tech companies being as efficient as they are, the only option is for the money to go to investors, and I'm happy that the employees get exposure to the company upside via RSUs. My opinion is of course heavily biaed :D


[0[ https://www.visualcapitalist.com/top-20 ... -employee/
Outside of professional athlete or other entertainer, what exactly is a faster way to "a good salary" then IC in tech?
I was just saying going to grad school, especially a PhD, is not necessary to get a "good IC salary" in tech. One can reach a higher salary, faster, without getting a PhD.
theorist
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Re: Very high earners ($400k+), how did you do it?

Post by theorist »

Just a minor comment on why you might want to earn more than e.g. 250k per year (in HCOL), given the satisfaction studies that show a leveling out with income above a certain level. (I thought about this for my personal situation.)

Earning a really significant amount above expenses per year gives you a kind of optionality that having a more standard income doesn’t give. A job which gives security precisely if you stick with it for 35 years (assuming you can!) till retirement is really a life-long commitment. Earning significantly more than you need for yearly spend — which perhaps could be 400k per year, or whatever — buys you the optionality to step out well before the 35 year career would be over, and spend your time doing other things.

This freedom to explore other interests without worrying about income, while you’re still relatively young and energetic, could be one valid motivation for finding really high compensation. (I’m not saying there aren’t others.)

For many of us, I hope, substantial parts of the excess income will go to charity sooner or later — so the cost to society, while it exists, will be somewhat leavened.
stoptothink
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Re: Very high earners ($400k+), how did you do it?

Post by stoptothink »

ScaledWheel wrote: Mon Nov 29, 2021 1:14 pm
stoptothink wrote: Mon Nov 29, 2021 1:08 pm
ScaledWheel wrote: Mon Nov 29, 2021 12:59 pm I'm an individual contributor (IC) in tech, which is a career I started after getting a PhD in STEM. This is definitely not the fastest way to a good salary, but I enjoyed the intellectual independence I got from doing grad work :happy

As others have mentioned, you will see a lot of people in tech in this thread. The reasoning being that, in most of tech, there is a very low to zero marginal costs to serving another customer. As such, revenues and profits per employee are quite high [see 0].

Someone upthread made the comment that no one should make 400k+ a year. But with the top tech companies being as efficient as they are, the only option is for the money to go to investors, and I'm happy that the employees get exposure to the company upside via RSUs. My opinion is of course heavily biaed :D


[0[ https://www.visualcapitalist.com/top-20 ... -employee/
Outside of professional athlete or other entertainer, what exactly is a faster way to "a good salary" then IC in tech?
I was just saying going to grad school, especially a PhD, is not necessary to get a "good IC salary" in tech. One can reach a higher salary, faster, without getting a PhD.
Oh, I know the feeling as a PhD scientist in healthcare whose wife earned more than him (in tech) before she even had a college degree (she does now).
alfaspider
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Re: Very high earners ($400k+), how did you do it?

Post by alfaspider »

theorist wrote: Mon Nov 29, 2021 1:15 pm

This freedom to explore other interests without worrying about income, while you’re still relatively young and energetic, could be one valid motivation for finding really high compensation. (I’m not saying there aren’t others.)

Exactly this. Someone in a HCOL area could certainly meet all of their basic needs on $250k (though children and a working spouse for a combined $250k could actually mean they are pretty money stressed). But if they wanted early FI, it would mean putting off things like homeownership until well into middle age. There is no hard number, but something like that $400k number means you can live fairly well in most locations while also setting yourself up for early FI. Even if you continue to work, FI means you can approach employment differently.

As an aside, there's also a balancing act to do when marriage is involved. Does one spouse sacrifice their career so the other can make the big bucks, or do you try to balance? There are plusses and minuses to each approach and there are different answers for each couple. It may be easier to make $400k+ between two professionals than trying to make that one one salary.
jharkin
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Re: Very high earners ($400k+), how did you do it?

Post by jharkin »

Williams57 wrote: Mon Nov 29, 2021 11:45 am

I am nowhere near that, but charity is big for me. You can help a lot of people and a lot of different causes.
Counterargument is that if wealth was not so concentrated in the top 1-5% and income was spread out more evenly to the bottom 80% we might not need so much charity to help people make ends meet.....
jharkin
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Re: Very high earners ($400k+), how did you do it?

Post by jharkin »

theorist wrote: Mon Nov 29, 2021 1:15 pm Just a minor comment on why you might want to earn more than e.g. 250k per year (in HCOL), given the satisfaction studies that show a leveling out with income above a certain level. (I thought about this for my personal situation.)

Earning a really significant amount above expenses per year gives you a kind of optionality that having a more standard income doesn’t give. A job which gives security precisely if you stick with it for 35 years (assuming you can!) till retirement is really a life-long commitment. Earning significantly more than you need for yearly spend — which perhaps could be 400k per year, or whatever — buys you the optionality to step out well before the 35 year career would be over, and spend your time doing other things.

This freedom to explore other interests without worrying about income, while you’re still relatively young and energetic, could be one valid motivation for finding really high compensation. (I’m not saying there aren’t others.)

For many of us, I hope, substantial parts of the excess income will go to charity sooner or later — so the cost to society, while it exists, will be somewhat leavened.
My point was that even at 250k, most people have this kind of flexibility.. We earn less than 250k near Boston, save nearly 6 figures each year and still I don't even have to think before clicking "buy now" or going on a 5k vacation. Sure I cant donate a million to a charity and get my name on a building but that's never been a life goal....
Last edited by jharkin on Mon Nov 29, 2021 2:08 pm, edited 1 time in total.
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AnnetteLouisan
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Re: Very high earners ($400k+), how did you do it?

Post by AnnetteLouisan »

Under 400 at 54, but: ivy law, big law, foreign language, overseas fellowship, international work, govt stints, think tanks, bar assns, panel speaking.

And lots of drudgery, hard work and stress! And good times too!

Ultimately the money is the least important of it.
Last edited by AnnetteLouisan on Mon Nov 29, 2021 2:09 pm, edited 2 times in total.
gogreen
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Re: Very high earners ($400k+), how did you do it?

Post by gogreen »

jharkin wrote: Mon Nov 29, 2021 2:03 pm
theorist wrote: Mon Nov 29, 2021 1:15 pm Just a minor comment on why you might want to earn more than e.g. 250k per year (in HCOL), given the satisfaction studies that show a leveling out with income above a certain level. (I thought about this for my personal situation.)

Earning a really significant amount above expenses per year gives you a kind of optionality that having a more standard income doesn’t give. A job which gives security precisely if you stick with it for 35 years (assuming you can!) till retirement is really a life-long commitment. Earning significantly more than you need for yearly spend — which perhaps could be 400k per year, or whatever — buys you the optionality to step out well before the 35 year career would be over, and spend your time doing other things.

This freedom to explore other interests without worrying about income, while you’re still relatively young and energetic, could be one valid motivation for finding really high compensation. (I’m not saying there aren’t others.)

For many of us, I hope, substantial parts of the excess income will go to charity sooner or later — so the cost to society, while it exists, will be somewhat leavened.
I don't even have to think before clicking "buy now" or going on a 5k vacation. How much more happiness is "more" going to bring me?
How big is your family? For me a 5k vacation is a frugal one :annoyed
sjl333
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Re: Very high earners ($400k+), how did you do it?

Post by sjl333 »

Engineer (non tech related) , individual contributor, need to work over 60 hours per week to hit that 400k+ level which I do typically every week. Consultant. Highly highly technical. Most people in my field have no idea what they are doing …. Hence why I get paid so much
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Re: Very high earners ($400k+), how did you do it?

Post by theorist »

jharkin wrote: Mon Nov 29, 2021 2:03 pm
theorist wrote: Mon Nov 29, 2021 1:15 pm Just a minor comment on why you might want to earn more than e.g. 250k per year (in HCOL), given the satisfaction studies that show a leveling out with income above a certain level. (I thought about this for my personal situation.)

Earning a really significant amount above expenses per year gives you a kind of optionality that having a more standard income doesn’t give. A job which gives security precisely if you stick with it for 35 years (assuming you can!) till retirement is really a life-long commitment. Earning significantly more than you need for yearly spend — which perhaps could be 400k per year, or whatever — buys you the optionality to step out well before the 35 year career would be over, and spend your time doing other things.

This freedom to explore other interests without worrying about income, while you’re still relatively young and energetic, could be one valid motivation for finding really high compensation. (I’m not saying there aren’t others.)

For many of us, I hope, substantial parts of the excess income will go to charity sooner or later — so the cost to society, while it exists, will be somewhat leavened.
My point was that even at 250k, most people have this kind of flexibility.. We earn less than 250k near Boston, save nearly 6 figures each year and still I don't even have to think before clicking "buy now" or going on a 5k vacation. Sure I cant donate a million to a charity and get my name on a building but that's never been a life goal....
I’m not going to disagree with anything you’re saying; people’s costs are a function of their location and other responsibilities, and maybe 250k is as good a number as 400k (which I was just quoting from the OP). My only point was that some significant level of income above expenses can be valuable for reasons other than ego. It might be that this level is attained at 100k for some and 400k for others, and I’m not going to try and adjudicate whose spending level is right :beer .
Williams57
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Re: Very high earners ($400k+), how did you do it?

Post by Williams57 »

jharkin wrote: Mon Nov 29, 2021 2:01 pm
Williams57 wrote: Mon Nov 29, 2021 11:45 am

I am nowhere near that, but charity is big for me. You can help a lot of people and a lot of different causes.
Counterargument is that if wealth was not so concentrated in the top 1-5% and income was spread out more evenly to the bottom 80% we might not need so much charity to help people make ends meet.....
Oh, I agree completely. The divide is becoming more and more obvious. Where I live you see million dollar condos sharing land with homeless encampments, and this isn't even California. "Neighbors", yet so far apart. So sad.
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Re: Very high earners ($400k+), how did you do it?

Post by stoptothink »

Williams57 wrote: Mon Nov 29, 2021 2:20 pm
jharkin wrote: Mon Nov 29, 2021 2:01 pm
Williams57 wrote: Mon Nov 29, 2021 11:45 am

I am nowhere near that, but charity is big for me. You can help a lot of people and a lot of different causes.
Counterargument is that if wealth was not so concentrated in the top 1-5% and income was spread out more evenly to the bottom 80% we might not need so much charity to help people make ends meet.....
Oh, I agree completely. The divide is becoming more and more obvious. Where I live you see million dollar condos sharing land with homeless encampments, and this isn't even California. So sad.
Homelessness generally has nothing to do with money...but let's not get this thread closed.
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Re: Very high earners ($400k+), how did you do it?

Post by Firemenot »

gogreen wrote: Mon Nov 29, 2021 2:08 pm
jharkin wrote: Mon Nov 29, 2021 2:03 pm
theorist wrote: Mon Nov 29, 2021 1:15 pm Just a minor comment on why you might want to earn more than e.g. 250k per year (in HCOL), given the satisfaction studies that show a leveling out with income above a certain level. (I thought about this for my personal situation.)

Earning a really significant amount above expenses per year gives you a kind of optionality that having a more standard income doesn’t give. A job which gives security precisely if you stick with it for 35 years (assuming you can!) till retirement is really a life-long commitment. Earning significantly more than you need for yearly spend — which perhaps could be 400k per year, or whatever — buys you the optionality to step out well before the 35 year career would be over, and spend your time doing other things.

This freedom to explore other interests without worrying about income, while you’re still relatively young and energetic, could be one valid motivation for finding really high compensation. (I’m not saying there aren’t others.)

For many of us, I hope, substantial parts of the excess income will go to charity sooner or later — so the cost to society, while it exists, will be somewhat leavened.
I don't even have to think before clicking "buy now" or going on a 5k vacation. How much more happiness is "more" going to bring me?
How big is your family? For me a 5k vacation is a frugal one :annoyed
My thoughts too. A family of 5 can easily spend most of that just on airline tickets.
Williams57
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Re: Very high earners ($400k+), how did you do it?

Post by Williams57 »

stoptothink wrote: Mon Nov 29, 2021 2:21 pm
Williams57 wrote: Mon Nov 29, 2021 2:20 pm
jharkin wrote: Mon Nov 29, 2021 2:01 pm
Williams57 wrote: Mon Nov 29, 2021 11:45 am

I am nowhere near that, but charity is big for me. You can help a lot of people and a lot of different causes.
Counterargument is that if wealth was not so concentrated in the top 1-5% and income was spread out more evenly to the bottom 80% we might not need so much charity to help people make ends meet.....
Oh, I agree completely. The divide is becoming more and more obvious. Where I live you see million dollar condos sharing land with homeless encampments, and this isn't even California. So sad.
Homelessness generally has nothing to do with money...but let's not get this thread closed.
I wouldn't say "has nothing to do with money". It has something to do with it, maybe not the main cause though. These people are not a monolith.

Anyway, money can buy happiness to some extent, and helps us pursue our dreams.
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Re: Very high earners ($400k+), how did you do it?

Post by Cipro »

PhD Genetics. Big pharma followed by biotech start-up. Retired 61.
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Re: Very high earners ($400k+), how did you do it?

Post by MAKsdad »

I'd rather make $400k a year for 10 years than $200k a year for 20 years. I hope the reasons are obvious but maybe not?
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Re: Very high earners ($400k+), how did you do it?

Post by RJC »

alfaspider wrote: Mon Nov 29, 2021 1:37 pm
theorist wrote: Mon Nov 29, 2021 1:15 pm

This freedom to explore other interests without worrying about income, while you’re still relatively young and energetic, could be one valid motivation for finding really high compensation. (I’m not saying there aren’t others.)

As an aside, there's also a balancing act to do when marriage is involved. Does one spouse sacrifice their career so the other can make the big bucks, or do you try to balance? There are plusses and minuses to each approach and there are different answers for each couple. It may be easier to make $400k+ between two professionals than trying to make that one one salary.
This. It's very difficult to have a spouse making $400k+ alone especially with kids. Something has to give.
100nanos
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Re: Very high earners ($400k+), how did you do it?

Post by 100nanos »

[duplicate]
Last edited by 100nanos on Tue Nov 30, 2021 12:07 pm, edited 3 times in total.
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9-5 Suited
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Re: Very high earners ($400k+), how did you do it?

Post by 9-5 Suited »

A few points:

- A nominal salary amount in the abstract isn't a great target. You could do dozens of these exercises, but as one example a $400K income in San Francisco is equivalent to a $198K income in Phoenix according to cost-of-living calculators. So a lot of people weighing in from the big coastal cities may not be exactly the sample you're seeking as they have a form of money illusion (https://en.wikipedia.org/wiki/Money_illusion). Granted some people find ways to live on much less and having higher nominal wages is actually great for them to become financially independent quickly.

- Owning businesses of any sort makes your income theoretically unlimited and is a best way to build large wealth IMO. I do make all-in compensation close to your thread target as a marketing/strategy leader, but despite never cracking that threshold in traditional compensation my single biggest wealth building opportunity came from having an equity position in a small company that was sold. And while doctors and lawyers make this much, I'm not sure money is a great reason by itself to enter those fields.

- Having a successful working spouse is another hugely impactful thing, as combined my wife and I are comfortable above that threshold even in years where bonus comp is bad. Since we see our income as household income, it's just as good as if one of us made that much and the other didn't work.
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Re: Very high earners ($400k+), how did you do it?

Post by Firemenot »

The vast majority of lawyers make substantially less than 400K.
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VictorStarr
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Re: Very high earners ($400k+), how did you do it?

Post by VictorStarr »

Software engineers at FAANG have to reach L5 level in four years with total compensation of $350-450K. It is a terminal level, afterwards one can coast at that level indefinitely without getting fired.
Total compensation at L7 (senior staff or principal engineer) is around $700-900K but only a few can reach this level.

Fresh graduates out of college with L3 make around $180-200K. But in the Bay Area majority of L3 engineers live with roommates, 1-BR apartment is over $3K.
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Re: Very high earners ($400k+), how did you do it?

Post by alfaspider »

RJC wrote: Mon Nov 29, 2021 2:43 pm
alfaspider wrote: Mon Nov 29, 2021 1:37 pm
theorist wrote: Mon Nov 29, 2021 1:15 pm

This freedom to explore other interests without worrying about income, while you’re still relatively young and energetic, could be one valid motivation for finding really high compensation. (I’m not saying there aren’t others.)

As an aside, there's also a balancing act to do when marriage is involved. Does one spouse sacrifice their career so the other can make the big bucks, or do you try to balance? There are plusses and minuses to each approach and there are different answers for each couple. It may be easier to make $400k+ between two professionals than trying to make that one one salary.
This. It's very difficult to have a spouse making $400k+ alone especially with kids. Something has to give.
We recently had that decision to make. Spouse had a offer that would have doubled their salary, but it would have meant 80 hour work weeks on a fairly regular basis. Wasn't financially worth sacrificing my career to take up the slack, and we didn't want our kids raised by nannies.
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Re: Very high earners ($400k+), how did you do it?

Post by AnnetteLouisan »

Firemenot wrote: Mon Nov 29, 2021 3:00 pm The vast majority of lawyers make substantially less than 400K.
True - and for all professions, there’s a progression of salary and title increase. You generally don’t graduate into a top job. You work your way up. Over decades.
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Re: Very high earners ($400k+), how did you do it?

Post by 100nanos »

9-5 Suited wrote: Mon Nov 29, 2021 2:55 pm but as one example a $400K income in San Francisco is equivalent to a $198K income in Phoenix according to cost-of-living calculators.
This is misleading.

Cost-of-living (COL) calculators make a fatal mistake of adjusting the entire 400K. Realistically, it should apply to the first, maybe 150-200K, depending on your lifestyle.

The things that should be adjusted: income tax and housing expense (rent/mortgage). The remaining 200-250K additional income in VHCOL areas is essentially pure “profit” (minus income taxes).

A Porsche 911, out-of-state college tuition, or a lie-flat business-class ticket costs the same, whether you’re buying from Texas or California.
Last edited by 100nanos on Mon Nov 29, 2021 3:16 pm, edited 3 times in total.
Firemenot
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Re: Very high earners ($400k+), how did you do it?

Post by Firemenot »

AnnetteLouisan wrote: Mon Nov 29, 2021 3:07 pm
Firemenot wrote: Mon Nov 29, 2021 3:00 pm The vast majority of lawyers make substantially less than 400K.
True - and for all professions, there’s a progression of salary and title increase. You generally don’t graduate into a top job. You work your way up. Over decades.
Let me rephrase — the vast majority of lawyers will NEVER make more than 400K in their career. That said, it can be done, for sure. I’ve been doing it the last few years on total comp, but only because stock price is growing.

In general, the numbers for attorneys are highly skewed. Almost no one makes the average salary as it’s a bimodal distribution. And the bottom paying node is larger. As a percentage of total lawyers, Big Law jobs don’t represent many.
Last edited by Firemenot on Mon Nov 29, 2021 3:14 pm, edited 2 times in total.
Dusn
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Re: Very high earners ($400k+), how did you do it?

Post by Dusn »

A single spouse making $400k really has a higher family income than 2 spouses making 400k. The taxes are much less for the single family earner for several reasons. In addition the “non-working” spouse is still working as a parent and saving the family a lot of money in childcare but their “work” is not taxed.

But there are other considerations besides taxes. It still may not be worth it.
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Re: Very high earners ($400k+), how did you do it?

Post by frugalor »

Yefuy.Goje wrote: Sun Nov 28, 2021 7:09 am Please share your story.

Edit to make it actionable: I moved from a very low income (<$20k) to high income (>$200k) right after a graduate degree that followed straight from undergrad and I was shocked to realize that there are so many people who make multiples of that. I thought I was making a lot of money (and it is a lot!!) but realized that I had a limited imagination because, at the time, I was seeing the people around me, as am I now. So I want to know how people do it.
You should go to teamblind to see the salaries people are making. 400K is at the low end.
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Re: Very high earners ($400k+), how did you do it?

Post by EddyB »

AnnetteLouisan wrote: Mon Nov 29, 2021 3:07 pm
Firemenot wrote: Mon Nov 29, 2021 3:00 pm The vast majority of lawyers make substantially less than 400K.
True - and for all professions, there’s a progression of salary and title increase. You generally don’t graduate into a top job. You work your way up. Over decades.
I always think that "lawyer" is such a broad category as to be useless for these discussions (probably like "business owner").
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Re: Very high life satisfaction & happiness, how did you do it?

Post by HomerJ »

calmaniac wrote: Mon Nov 29, 2021 8:21 am Re: Very high life satisfaction, health, & happiness, how did you do it?

OP, I think you are trying to optimize the wrong variable.

Once you are making $200k, money is not the critical variable to life.
Agreed.
"The best tools available to us are shovels, not scalpels. Don't get carried away." - vanBogle59
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Re: Very high earners ($400k+), how did you do it?

Post by AnnetteLouisan »

Firemenot wrote: Mon Nov 29, 2021 3:13 pm
AnnetteLouisan wrote: Mon Nov 29, 2021 3:07 pm
Firemenot wrote: Mon Nov 29, 2021 3:00 pm The vast majority of lawyers make substantially less than 400K.
True - and for all professions, there’s a progression of salary and title increase. You generally don’t graduate into a top job. You work your way up. Over decades.
Let me rephrase — the vast majority of lawyers will NEVER make more than 400K in their career. That said, it can be done, for sure. I’ve been doing it the last few years on total comp, but only because stock price is growing.

In general, the numbers for attorneys are highly skewed. Almost no one makes the average salary as it’s a bimodal distribution. And the bottom paying node is larger. As a percentage of total lawyers, Big Law jobs don’t represent many.
True - big law is a tiny sliver of the legal profession.
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Re: Very high earners ($400k+), how did you do it?

Post by newyorker »

Business owner most likely... ive seen guys pulling in 8 fig income and some even in 9 fig range. Only way to get there is via business.
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Re: Very high earners ($400k+), how did you do it?

Post by AnnetteLouisan »

Maybe the OP could consider reading Everyday Millionaires by Chris Hogan. Or listen to the millionaire theme hour on Ramsey. No shortage of great stories from all walks of life. No need to be a quant or in tech to do it.
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Re: Very high earners ($400k+), how did you do it?

Post by HomerJ »

MAKsdad wrote: Mon Nov 29, 2021 2:42 pm I'd rather make $400k a year for 10 years than $200k a year for 20 years. I hope the reasons are obvious but maybe not?
I'd say maybe not. What if the $400k job required 60 hour weeks, with 24/7 stress and always being available, while the the $200k job required a 40 hour week with very few calls after-hours?

Especially if you have kids.
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Re: Very high earners ($400k+), how did you do it?

Post by mirror »

Sales, business owner.
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Re: Very high earners ($400k+), how did you do it?

Post by riverant »

This income is possible for more than a few people at non-tech or law mega-corps if we're counting base salary + highest potential bonus, even without being a crazy workaholic. Diverging from tech, the high earners at these places likely went the MBA route and manage a large department. Generally, you'd imagine top performance is required, but it's not dependent on hard skills, immense academic qualification, or any sort of "genius" intelligence.
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Re: Very high earners ($400k+), how did you do it?

Post by Oleanmike »

Been retired for 9 years after working for a major oil company. To make that kind of money I had to take assignments in non-desirable locations and let the allowances and incentives pile up.
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Re: Very high earners ($400k+), how did you do it?

Post by tim1999 »

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Last edited by tim1999 on Mon Nov 29, 2021 9:47 pm, edited 1 time in total.
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Re: Very high earners ($400k+), how did you do it?

Post by 9-5 Suited »

100nanos wrote: Mon Nov 29, 2021 3:10 pm
9-5 Suited wrote: Mon Nov 29, 2021 2:55 pm but as one example a $400K income in San Francisco is equivalent to a $198K income in Phoenix according to cost-of-living calculators.
This is misleading.

Cost-of-living (COL) calculators make a fatal mistake of adjusting the entire 400K. Realistically, it should apply to the first, maybe 150-200K, depending on your lifestyle.

The things that should be adjusted: income tax and housing expense (rent/mortgage). The remaining 200-250K additional income in VHCOL areas is essentially pure “profit” (minus income taxes).

A Porsche 911, out-of-state college tuition, or a lie-flat business-class ticket costs the same, whether you’re buying from Texas or California.
I acknowledged as much at the end of that sentence which you cropped, FYI. Any calculator is just a rough starting point. The point remains that regardless of how much you think the right adjustment is, it isn’t zero. Therefore, $400k isn’t the same everywhere so there’s no particular reason to set that threshold for a question like this. A surgeon making $350k in Omaha is doing very well.
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Re: Very high earners ($400k+), how did you do it?

Post by OldBallCoach »

Coaching...put in brutal hours for years...moved about 10 times...got very lucky...still love it...money is pretty good now....early days not so much...
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Re: Very high earners ($400k+), how did you do it?

Post by anon_investor »

HomerJ wrote: Mon Nov 29, 2021 3:32 pm
MAKsdad wrote: Mon Nov 29, 2021 2:42 pm I'd rather make $400k a year for 10 years than $200k a year for 20 years. I hope the reasons are obvious but maybe not?
I'd say maybe not. What if the $400k job required 60 hour weeks, with 24/7 stress and always being available, while the the $200k job required a 40 hour week with very few calls after-hours?

Especially if you have kids.
This is why many leave biglaw well before they become partners.
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Re: Very high earners ($400k+), how did you do it?

Post by newyorker »

Some MD speciality (Rad, OS, NS) can pull in 7 fig

Big law partners can pull in 7 fig

Finance guys can pull in 7 fig easy i heard (MDs)
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