🌼The Mind-Blowing Facts About Income Levels That May Change Your Life Forever


🌼The Mind-Blowing Facts About Income Levels That May Change Your Life Forever

## Gain insights on how income levels impact financial stability, quality of life, and career growth.

Nevertheless, the amount of income accrued is subject to considerable variation across different regions of the world, with some individuals subsisting on scant resources while others luxuriate in tremendous opulence. Gaining insight into the diverse levels of income can facilitate an appreciation of the financial vicissitudes people face and the obstacles and prospects that ensue.


Income is an essential determinant of our lifestyle and general welfare. It exercises a profound influence over our capacity to satisfy basic needs, such as sustenance, habitation, and healthcare, as well as our potential to engage in recreational pursuits and pursue personal aspirations. Nevertheless, not all forms of income are uniform, and an appreciation of the distinct categories of income can furnish us with the tools to navigate financial decision-making and chart a course for the future.

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This article will delve into the various strata of income and their peculiarities, ranging from poverty to affluence.


## Level 0: $0-No Income

Level zero denotes a complete absence of income. This phase is commonly experienced by young individuals, such as students, who rely heavily on financial assistance from a third party, usually their parents. Although they may receive an allowance or state benefits, it is typically not a significant amount, and possessing just $500 would feel like a significant sum of money.

At this stage, one has not yet faced the responsibility of paying bills or taxes. Although they may dabble in selling items online or exploring investment opportunities to make some money, they do not generate income on a consistent basis.

Being financially dependent on parents can be frustrating, especially after witnessing peers flaunting their wealth on social media. However, individuals in level zero are not yet equipped to live independently, but that time will come eventually.

Public transportation, walking, or occasional Uber rides are the primary modes of transportation for people at this stage. Their friends are likely in the same boat and also rely on their parents for financial support.

Education is crucial at this stage, and individuals are encouraged to read, learn and listen to podcasts to equip themselves with knowledge and skills that will prove useful in the future.

## Level 1: $1,000/m — 15k/yr

Level one is characterized by a monthly income of around $1,000, which translates to an annual income of between $10,000 and $15,000. It is usually the first time individuals start earning a steady income, and the feeling of accomplishment is unparalleled when they make their first $1,000.

Newfound wealth can lead to some recklessness at this stage. Individuals may indulge in items they have always wanted, such as clothes, sneakers, or a PS5. They may also use some of their earnings to contribute to household expenses and be surprised by how expensive food can be.

Although they know that this income level is not sufficient for the long term, individuals in level one remain focused and driven, confident that this is just the beginning. However, their friends may view them differently, unsure if they are serious or capable of achieving their goals.

Parents are supportive of their success but are also concerned that their studies or other activities are not compromised. Individuals may still live with their parents or share an apartment with roommates which is less than ideal, but they relish the newfound sense of independence.

At this stage, $50,000 is considered a significant sum of money, and individuals remain motivated to work toward a better financial future.

## Level 2: $3k/m up to $50k/yr

Level two represents a monthly income of around $3,000, which is a sustainable long-term income. Individuals at this stage indulge in small luxuries, treat loved ones to nice meals, and upgrade their living arrangements. They can save some residual income at the end of each month.

This level of income brings a jump in happiness that feels like unlocking the secrets to the universe. Individuals at this stage may offer financial advice to friends, and their friends may feel envious. Level two makes up the majority of the middle class, which most people can achieve if they remain determined.

However, going from level two to level three is the most challenging income jump that individuals will ever have to make. The methods that worked for them to reach $3,000 a month will not be enough to help them earn beyond $10,000 a month.

## Level 3: $10k/m to $150k/yr

Level three represents a monthly income of around $10,000, which corresponds to an annual income of between $100,000 and $150,000. This stage typically involves a side hustle that has become a successful business or a promotion to a high-ranking position in a company.

Individuals at this level feel a great deal of responsibility and realize that they no longer have the same amount of time they once did. Money no longer brings the same level of happiness as before. Studies suggest that $100,000 a year is the threshold beyond which further increases in income are unlikely to boost overall happiness.

At this level, individuals can afford to buy a nice car, splurge on clothes, and take an exotic vacation overseas once or twice a year. It is wise to consider investing at this stage, but passive investments should not be considered until earning over $100,000 a year in income.

Although individuals have acquired valuable skill sets and feel confident in their ability to provide for themselves and their families, their cost of living is increasing. The idea of having children is being considered, and individuals realize that $100,000 a year may not be enough to support the lifestyle they want for their family.

## Level 4: $30k to $50k/m

Level four is marked by a monthly income of between $30,000 and $50,000, which corresponds to an annual income of between $300,000 and half a million dollars. Individuals at this level feel genuinely rich and confident in their ability to generate income.

They have purchased an incredible home, paid for it in full, and invested in real estate and stocks for passive income. They are disciplined with their finances and have enough savings to support their household for over six months without income.

Individuals at this level do not worry about bills, groceries, or minor expenses as they are all taken care of. They can travel with lounge access and fly in the economy plus with preferred seats, enjoying food and champagne on flights. Most people at this level either play it safe or risk most of their income on a new venture with a higher upside.

## Level 5: $100k to $250k/m

Level five represents a monthly income of $100k to $250k and an annual income of $1 million to $3 million, placing individuals in the top 1% of earners. They are likely a business partner or owner with multiple employees earning between $45,000 to $100,000 a year. Individuals at this level have recently signed big clients, and they no longer handle the little things in their organization.

They have an assistant and are grooming someone to take over in a couple of years or preparing to sell their company. They have purchased a house with enough bathrooms to ensure they never have to wait again and an extensive investment portfolio. They can afford any holiday they want but struggle with time constraints.

Individuals at this level worry about their children being spoiled but are proud of the comfort they can offer them.

This income level can be most stressful personally as even though they possess substantial wealth, they feel inadequate compared to the ultra-rich. Such individuals value time greatly and may contemplate retiring to a beach.

## Level 6: $10 million to 15 million per year

Level six is the ultimate level of wealth with a monthly income of one million dollars and an annual income of between 10 and 15 million dollars. At this level, money no longer contributes to your overall happiness, and you can afford to live anywhere in the world. You’ve built a successful business with a solid product that is perfectly aligned with the marketplace. You manage managers, and your business has a clearly defined infrastructure that operates independently of you.

At this stage, your riches exceed your expenditure, with investments generating over $1 million annually in expendable revenue. You attract newfound attention, especially in upper-class circles, but you never compromise on the values you hold dear. You develop a heightened awareness of people’s motives and the attendant hazards, owing to the magnitude of your possessions. Silicon Valley has devised the “Golden Millionaire” principle, stipulating that your net worth should at least match your age. Thus, possessing $35 million at 35 years of age would classify you as a “Golden Millionaire.”

Between $20 and $80 million, the disparity in lifestyle is negligible. You marvel at those with net worth exceeding $100 million as they can purchase the aircraft and ships that you’re renting. At this level of wealth, financial anxiety is no longer a concern, and you can focus entirely on relishing life.

## Level 7: $50 million to $100 million per year

Level seven income is $50 million to $100 million per year, earned by those who own or run incredibly successful multinational companies. Over 40 CEOs in the United States alone earn over $100 million per year, and paying an eight-figure salary by owning a company generating over $100 million annually is possible but requires robust systems that can scale.

At this income level, you can afford private jets and yachts, contribute significantly to charities, acquire new businesses (even competitors), and attract investment funds and industry leaders’ interest. However, you may start to question if your achievements will have a lasting effect on humanity, and money may not impress you unless it starts with a “b.”

Of the roughly 215 million companies worldwide, only an estimated 55,000 generate over $100 million per year, giving starting a company today a one in 20,000 chance of reaching $100 million in revenue. Famous actors or athletes may struggle to reach this level without building a company first, and earning $100 million per year can result from generating $1 billion worth of value and retaining 10% of it. In life, your rewards will always be proportionate to your contribution.

## Level 8: A couple of hundred million dollars

Level eight represents an income of a couple hundred million dollars but not yet reaching the billion-dollar mark. Hedge fund managers and business tycoons, including heirs to industrial empires, are the most common individuals who earn this level of income. However, most of them are outliers who are unable to sustain themselves for decades.

Hedge funds manage other wealthy people’s money with the goal of generating high returns. These institutions invest billions of dollars annually and keep a percentage of the profits they generate. To join these funds, one usually needs a net worth in the tens of millions of dollars.

Business tycoons actively reshape the world by building hotel chains, shopping malls, and apartment complexes. At this level, buying businesses becomes the norm, and working with the government becomes a necessity. You donate to politicians and throw charity events to ensure your projects get the green light.

At this level, you have access to nearly everyone, including high-profile figures, but prioritize security with a military-trained driver. Your offspring attend overseas schools alongside other ultra-wealthy students. People fail to grasp the importance of your mission, leaving you weary, and you harbor grudges with other affluent individuals. Nevertheless, you persist since you fear your legacy will fade without your involvement.

## Level 9: One billion dollars or more per year

Level nine corresponds to a yearly income of $1 billion or more, with the emphasis shifting to augmenting net worth rather than income alone.

The world’s wealthiest individuals, such as Jeff Bezos and Elon Musk, have amplified their net worth by over $400 billion in a year, per the Bloomberg index. Hedge fund managers rank among the top earners, with salaries exceeding $1 billion annually, such as Jim Simons of Renaissance Technologies.

At this stage, societal impact and legacy assume paramount importance. Bezos and Musk compete in space exploration, while Peter Thiel strives to eradicate death. Gates and Buffett donate most of their wealth to combating disease. While attainable, this level of income demands substantial sacrifices.

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## Conclusion

It is important to ask ourselves what level of income we are currently at and what level we intend to reach. We must also be mindful of the negative income and desire for more trap, where debt can spiral out of control and we never feel like we have enough money.

A study on high-net-worth individuals showed that on average, people perceive the next level of safety, abundance, and prosperity at 3.2 times what they currently have. It is a never-ending game unless we decide that we have already won.

Contributed by The Money Mindset

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