Have you ever wondered how much is 5 figures in money? When people are discussing salaries and how much they make, we often hear about 5 figure salaries, 5 figure bonuses, and the “5 figure” word used often in general.
But how much is it actually? If you were offered a five-figure contract, how much might that be in actual dollar terms? In this article, we explore what the term “5 figure” is all about and professions that earn five figure annual salaries.
- How Much Is 5 figures in Money?
- Is a Five Figure Earner a High Earner?
- Factors that Determine the Value of a Five Figure Income
- 1. Your Location
- 2. Existing debt
- 3. Your lifestyle
- Popular Five Figure Income Jobs You Should Know
- How to Go From a Five Figure Income to a Six Figure Income
- 1. Cultivate your work ethic and professional network
- 2. Gain new skills and certifications
- 3. Develop financially healthy habits
- 4. Save more
- Is Five Figures a Lot of Money?
How Much Is 5 figures in Money?
In financial terms, five figures is a money bracket with the minimum being $10,000 and extending up to $99,999. When you hear of someone who earns a five-figure salary, just know that they are earning anything from $10,000 to $99,999.
So a five figure salary earner cannot earn below $10,000, since $9,999 and under is four figures. Similarly, they cannot earn above $99,999, as that will take them to the six-figure $100,000 mark. For many earners within this bracket, their income includes their main pay, bonuses, commissions, and other income sources.
For the average person, a five figure income is not a bad place to start, although many would like to raise it into the six figure bracket. So now that you know how much is 5 figures in money, let us dissect this income scale to give you a fair idea of the living standard of people at this income level.
Is a Five Figure Earner a High Earner?
Someone making five figures is typically not considered a high earner in the United States, particularly those who are on the lower end of the scale.
Those who occupy the mid-level or upper level of this bracket are considered the middle class of society.
For those earning close to the $99,999 mark, they can almost always live comfortably. However, their level of luxury will also depend on their city of residence, as some cities like LA and New York or Miami are more expensive than cities like Detroit or Kansas.
Factors that Determine the Value of a Five Figure Income
To better understand the point in the previous paragraph, here are some factors that will determine just how far a five figure income will take you.
1. Your Location
When it comes to cost of living and how far your income will stretch, where you live matters.
No two areas have the same cost of living. It’s simply an economic fact that some cities are more expensive than others. Factors that affect living costs are real estate, transportation, and groceries. Even how much restaurants charge for takeout matters.
The tax rate is another major factor determining how expensive or cheap a city is. Some economists will even argue that the tax rate influences everything else.
My family lives in small town Iowa, where cost of living is considerably less than much of the country. We own a 4-bedroom house for less than what others pay for a small apartment in more populated areas. While workers here in the Midwest can live more comfortably on a five-figure income, others in bigger cities may find that is not enough for the same lifestyle. Larger cities like New York, Chicago, and San Francisco are more expensive.
2. Existing debt
When deciding if a 5 figure salary is enough to support your lifestyle, one important factor to keep in mind is your level of debt. If you have student loans, large credit card bills, or medical expenses, a five figure income may not be enough to allow for extras like dining out or vacations.
Having debt can affect your cash flow and your overall financial capacity more than anything else. This is made even worse if the debt has a high double-digit interest attached to it. Paying your daily bills is one thing, but paying debts owed from previous months or years will take a significant chunk out of your wages.
Working on getting your debt under control? Don’t miss these top budget planners.
3. Your lifestyle
Some people earn five figure wages and live very comfortably, while others can barely survive paycheck to paycheck. There are plenty of reasons for this, but one potential factor is their lifestyle. If you live a lavish lifestyle, it might seem like you are not making enough money, while your peers are living comfortably and saving money on the same wage.
Eating at fancy restaurants, visiting casinos, wearing expensive designer clothes, buying a bigger house than you need, and driving fancy cars are some of the spending habits that set many people back. Although there is nothing wrong with indulging yourself every once in a while, if you live above your means, you will find it very hard to be financially successful. This article can help you decide if frugal living is worth it.
Popular Five Figure Income Jobs You Should Know
There are many different jobs that earn five figure incomes you should know about. If you are skilled enough, you can earn close to $99,999 a year doing these jobs. They include but are not limited to:
- Graphic and fashion designers
- Registered nurses
- High school teachers
- Construction workers
- Store managers
- Customer service agents
As you can see, some of the jobs on the list require college degrees or specialty training, while most of them do not. Even those requiring college degrees are mainly skilled-based rather than just having a certificate alone.
Since five figure salaries are such a wide range, here is a table detailing the median salaries of some of these professionals in the US.
|High School Teacher||$61,660|
How to Go From a Five Figure Income to a Six Figure Income
If you are on a five figure income, that doesn’t mean you have to remain there! Many people have grown their income from five figures into six figures, and you can do the same. Here are some tips to help you do that.
1. Cultivate your work ethic and professional network
Build a very strong character for excellence. Develop a strong work ethic and work towards your goals, and with time you will achieve all you set out to accomplish.
In addition to building your character, build your contacts as well. Be sure to take time to network, to get to know people and to stay in touch with professional connections. These colleagues could be the one to help you take your career, and your earnings to the next level.
2. Gain new skills and certifications
Instead of staying in your comfort zone, continue to improve yourself. If you have a skill, apply yourself and make a commitment to improve.
If your job is dependent on credentials to achieve upward mobility, then get a higher certification. The more you improve yourself, the more access you will have to grow financially.
3. Develop financially healthy habits
While some habits like working out regularly can be a good thing, other habits like dining out or a daily coffee at your local coffee shop can be expensive and really add up. While it’s OK to indulge sometimes, cutting back on unnecessary expenses can save considerable money and help you reduce your debt.
4. Save more
By working to increase your income and developing good habits with money, you will naturally start to spend less and save more. With more savings, you will be setting yourself up to invest in economic opportunities like stock investing or starting a new business or side hustle.
Is Five Figures a Lot of Money?
How much is 5 figures in money? This level of income is in a wide range that could be anywhere from $10,000 to $99,999 annually. This amount of income can help you live a certain kind of lifestyle depending on where you live, if you have any debt, and your habits. To work on increasing your income, check out these ideas to make money.
Kim Ritter is a frugal living expert, blogger and mom of two from small-town Iowa. What began as an effort to help her family save a few dollars a month has now transformed into a full-time passion to help other parents money. Visit her online at twokidsandacoupon.com and follow her on Twitter at @2kidsandacoupon for more ways your family can have fun on a budget.