One of the debates circulating around the Internet recently is that of the importance of a six-figure income. Six-figures doesn’t seem like such a big deal anymore — at least if the income is in the lower six-figures.
There are two opposing reasons that six-figures might not matter anymore: It’s just not that much money these days, and people are looking for things other than money to make them happen now.
Is a Lower Six-Figure Income Even a Big Deal?
Many of us in the middle class grew up thinking that hitting the $100,000 a year mark would be the ticket to the good life and financial security. A lower six-figure income meant that you had “made it” in terms of finances. However, things are changing. Inflation in recent years has resulted in a situation where a lower six-figure income just isn’t that big a deal anymore. Additionally, as spending habits change for Canadians (and credit card debt is on the rise), and as the cost of living in cities like Toronto and Vancouver increases, six-figures just don’t go as far as they used to.
There are a number of consumers that make $100,000 or more a year, and still can’t seem to make ends meet. An income in the lower six-figures doesn’t cover all expenses so well in some cases, depending on spending habits, and cost of living. If you live an area that is expensive, and you think that you “need” certain things for a happy life, then it might be easier than you think to exceed your income — even if it is six figures.
The Other Side: Frugality Takes Hold
While there is the issue of money just not going as far as it used to, there is another side to the goal of a six-figure income. It’s that you don’t even need to go for that goal. A number of Canadians, learning from the problems of our neighbours to the South (or perhaps never really buying in to the consumerism), embrace frugality. Rather than worrying about keeping up with the Joneses, many are satisfied with what they have, and refuse to get caught up in the spending.
If you can be content, and live so that you feel rich on $50,000 a year, there’s no reason to get excited about a six-figure income. Indeed, a six-figure income isn’t a big deal at all if you are happy with where you are in life, and focus on things like relationships, simple living, and contentment. You don’t even have to shun credit cards for this mindset. A good cash back credit card can even provide you with what you are looking for on an income of less than $100,000 a year — as long as you have a budget and pay off the balance each month.
In the end, a six-figure income isn’t all its cracked up to be. Making $100,000 won’t guarantee your happiness, especially since you are the type that relies on money to feel content. In those cases, a lower six-figure income just won’t be enough anyway.
Image source: Revisorweb via Wikipedia Commons