The news media often says earning $75,000/year is the magic happiness number for most people. After this number, your happiness level begins to diminish. Here is an article on VeryWellMind.com that refutes the argument.
There is a lot of truth to this $75,000 number—my two cents. However, it doesn’t tell the complete story. Today, I want to dig into where happiness and money collide.
Four parts to a story. Like writing a novel, there are multiple chapters to this story. I will break it down into four sections:
- Earning $75,000/year
- Earning more than $75,000/year
- Making $75,000/year passively
- Making more than $75,000/year passively
Earning $75,000/year. For many, earning $75,000/year as an individual or family seems out of reach. They may be stuck in a dead-end job or lack the resources or education to get themselves out of a rut.
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For those out there who are struggling, it’s time to step up your game. There has never been a better time to make additional income in this world.
No matter where you are, as long as you have access to the internet, you can build something great. I recommend creating content such as YouTube videos or blogging.
The only thing stopping you from earning more money is limiting beliefs. If you find yourself watching a lot of Netflix or playing video games, you need to overcome this part of your life.
You need to grind in life and become Passive Income Heroes. Start by aiming for $75,000/year; YES, it will improve your quality of life. Once you have some cash flow, your happiness (contentment and satisfaction) will increase.
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Earning more than $75,000. If you are earning more than $75,000/year, this is where happiness factors into the equation.
I believe we should all strive to make much more than $75,000, but live under our means. I think happiness erodes when we spend more than $75,000/year.
For example, I currently earn roughly $140,000/year, and my wife adds $48,000. However we don’t spend $6,000/month (total $75,000/year) on ourselves.
We keep our expenses low, have roommates, and save & invest money for the future. That’s the idea. Live right at or below $75,000, but make much more. You can use the remaining cash flow to prepare for the future.
From Broke to Saver to Investor
People who make more than $75,000 let lifestyle inflation creep into their lives. They buy more expensive cars, houses, and vacation packages.
It’s nice to splurge every once and a while; however, we shouldn’t let things get out of hand. If you make $200,000/year and are broke, there may be an issue.
“But Josh, I live in a high cost of living area!” I get it. You can still get roommates, find a second job, or start a small business.
Your lifestyle number may be $150,000. You should still set a number that will keep you humble and allow you to save and invest for the future.
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Making $75,000/year passively. But you do not want to depend on earned income for our entire lives, do you? If you are investing in yourself and building an empire, you should start to see the fruits of your labor in passive income.
Your goal should be to replace our $75,000/year with passive income from rents, royalties, and dividends. That’s why it is vital you don’t let lifestyle creep into our households.
If you never exceed $75,000 in your mindset, living on $75,000/year passively will be much simpler.
No matter where you are in life, you can start building passive income streams today. Passive income comes in while you sleep, which allows you the freedom to create more passive income.
If you don’t know where to start when building passive income, read “What is Passive Income?” and “What is Financial Independence?”
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Earning more than $75,000/year passively. Finally, you don’t want to stop building passive income streams. You don’t know what the future holds; therefore, you must prepare for everything.
You can’t assume what your and your kids’ lives have in store for us. I always quote earning $20,000/month in passive income, but I want more than this.
I never want to get to where I need to return to work or borrow money. If my grandkids need assistance, I want to be the bank. I don’t want to depend on the government or others to assist.
Have you ever seen on the news when someone dies tragically? The family must set up a “GoFundMe” to crowdfund the funeral. I sympathize with these situations; however, we must also prepare for the unknown.
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Things we do today have consequences tomorrow. Aiming for large amounts of passive income (while not becoming greedy) will prevent your family from falling apart.
Conclusion. Earning and making a lot of money is not evil. It doesn’t make you a bad person if you want to be rich & wealthy.
The thing that usually gets people in trouble is materialism and not treating others fairly. You want to make as much money as possible by adding value to the world.
The Metaverse vs. Your Job
That’s right; go to work with a smile and converse with everyone. Write about your experience at your job and life. Produce videos explaining your niche skill set.
No matter what you do in life (stay-at-home mom, military, IT professional), someone wants to learn about your situation. They may want to retire overseas, meet a special someone, or travel to the moon.
We can all add value, which is the path to great wealth. Once you build your income streams, you still must live below your means to protect your family’s future.
There is truth to the $75,000/year number, but it is a mixed bag. You want tons of passive income and to live humbly. That’s where you achieve maximum happiness. Good Luck!
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