Author Topic: Are most of the members here high earners?  (Read 48709 times)

EconDiva

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Are most of the members here high earners?
« on: March 27, 2014, 11:47:43 AM »
Based on many posts, it seems that way. Or average incomes who started saving when they were like 12 lol.

I'm 35 and just a tad above an average income but just starting my road to mustachianism. Sometimes it's hard seeing how much so many people have managed to amass. Is there anyone else like me here who is way behind and trying to figure out how to retire by say, age 55?

Frankies Girl

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Re: Are most of the members here high earners?
« Reply #1 on: March 27, 2014, 11:55:47 AM »
Nope. Lots of folks that make less than 6 figures. I'm one of them. Even with my spouse, we're well under that threshold.

The key isn't how much you make, it's how much you spend and are able to save. If you only make $40K, but you live off of $20K, then you're at a 50% savings rate and can shoot for a much smaller amount for becoming FI.





Eric

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Re: Are most of the members here high earners?
« Reply #2 on: March 27, 2014, 11:57:55 AM »
The beauty is that it's not how much you earn, but how much you save.

http://www.mrmoneymustache.com/2012/01/13/the-shockingly-simple-math-behind-early-retirement/

sherr

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Re: Are most of the members here high earners?
« Reply #3 on: March 27, 2014, 11:59:03 AM »
Yes, this forum tends to be very heavily weighted towards engineers, DINKs, or even engineer DINKs. There are people who have below-average salaries here, just not as many.

All the same principles apply either way, the more you save with respect to how much you spend the faster you'll have enough to retire. It's just harder to live off of 50% of a $50k salary than it is to live off of 30% of a $100k salary. You'll get there, it'll just take a little longer and / or you'll have a little less luxury than a high earner.

Eric

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Re: Are most of the members here high earners?
« Reply #4 on: March 27, 2014, 11:59:58 AM »

iwasjustwondering

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Re: Are most of the members here high earners?
« Reply #5 on: March 27, 2014, 12:01:21 PM »
I'm a high earner, but started late.  At age 35, I was a single mother with no money (I mean no money -- no 401K, no savings, nothing), $44,000 in student loans, a $511 monthly car payment, $3,000 in monthly childcare bills, a 1.5-hour commute each way (which directly caused the enormous childcare bills), and a $2,400 monthly rent.  Eight years later my situation is vastly different (I have no non-mortgage debt now, around $100,000 in home equity and around $200,000 in investments, including 401K and college savings).  This is mostly due to going after a higher income, but I am also starting to learn to save.

I'm still way, way behind. 

randymarsh

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Re: Are most of the members here high earners?
« Reply #6 on: March 27, 2014, 12:04:23 PM »
There are a lot of engineers and software developers here, but plenty of lower earners too.

A lot of people are married and probably give household income so some of the numbers are actually for 2 people.

Spending is very important. At 35, you probably have a lot of your spending locked in and your standards have been set. Reevaluate those and you'll likely find areas to cut.

Metta

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Re: Are most of the members here high earners?
« Reply #7 on: March 27, 2014, 12:06:26 PM »
Hi,

You don't say what you consider an average income. We started eliminating debt and saving when we were in our early-thirties with a goal designated by my husband of being able to retire at age 55. We started with about $80,000 of student loan debt (don't punch me), some amount of credit card debt and some other more embarrassing debt. Our household income at that point was around $40,000 (mostly from my job since my husband was a Ph.D. student) and we didn't have a house or much in the way of savings.

At this point we have a house note that will be paid off in about 18 months (extra money being put on it), combined income of $130,000 (but only a few short years ago it was about $70000 so the extra money is fairly new) and an investment account that is sniffing close to a million dollars. I am 52 and will be able to retire and go back to school for a degree I want in three years. In truth, I could probably do it in 18 months when the house is paid off, but there are definite benefits to actually retiring from my company instead of leaving.

So it is definitely possible. The most important thing we learned is that we needed to automate our investing and every salary increase needed to be whisked away into the investment accounts so that we would not upgrade our lifestyle with the extra money. We also strongly feel that one salary should support both us so that if there is a layoff or some other problem, we are sustainable. We struggle a bit with this one since our salaries are not equal.

We have on occasion gotten lost in the weeds of excessive consumerism but we find the trail to FI over and over again when we get lost. You can definitely do this with an average income. You don't even have to be incredibly good with money or incredibly frugal. You just need to pay attention.

EconDiva

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Re: Are most of the members here high earners?
« Reply #8 on: March 27, 2014, 12:07:30 PM »
I'm a high earner, but started late.  At age 35, I was a single mother with no money (I mean no money -- no 401K, no savings, nothing), $44,000 in student loans, a $511 monthly car payment, $3,000 in monthly childcare bills, a 1.5-hour commute each way (which directly caused the enormous childcare bills), and a $2,400 monthly rent.  Eight years later my situation is vastly different (I have no non-mortgage debt now, around $100,000 in home equity and around $200,000 in investments, including 401K and college savings).  This is mostly due to going after a higher income, but I am also starting to learn to save.

I'm still way, way behind.

Thanks for sharing. That's a whole lot of progress in just 8 years and is very admirable.

Exflyboy

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Re: Are most of the members here high earners?
« Reply #9 on: March 27, 2014, 12:15:18 PM »
My story. Started in my late 30's at roughly zero NW.. just retired at 52.5 years old.

Yes I did earn 6 figures but only for a small part of the time.

http://www.mrmoneymustache.com/forum/share-your-badassity/i-retired-today!-%29/msg239245/#msg239245

Frank

socaso

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Re: Are most of the members here high earners?
« Reply #10 on: March 27, 2014, 12:19:55 PM »
I know what you mean. Sometimes I feel behind when other people on the forum are posting about whether they should buy a second income property or bank the $$. I just take a breath and try to remember everyone's situation is different. There's lots of good information here and it's nice to communicate with people who are on the saving not spending track.

skunkfunk

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Re: Are most of the members here high earners?
« Reply #11 on: March 27, 2014, 12:21:02 PM »
Am I the only electrical engineer around here who makes under $50k?

Perhaps not, but I'll bet I'm the only engineer around here who makes under $50k and loves his job.

El Gringo

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Re: Are most of the members here high earners?
« Reply #12 on: March 27, 2014, 12:23:03 PM »
I can relate to you. I currently earn $42k in one of the most expensive areas of the country and still paying off my school loans. I get discouraged when I read about other people's incomes. It's frustrating - I really want to get a higher salary and I feel limited in my ability to save currently. But meanwhile, I'm putting away about 30% of my take-home pay into my my 401k and IRA (plus an additional 6% match).

nereo

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Re: Are most of the members here high earners?
« Reply #13 on: March 27, 2014, 12:46:18 PM »
Just letting you know that we (my fiancée and I) are another group of below-average earners.  Both of us got offers where we are "paid" (on stipends) while getting our graduate degrees, but it means our combined income after tuition and fees is about $30k (will know exactly after next session). Before this, our combined DINK income never exceeded $60k. This was due to the combined effects of low paying fields, a bad job market, and choosing jobs that 'boosted our experience' instead of maximized take-home pay.

I'm guilty of frequently thinking "hey, if I had the income of many of the people around here I'd be FIRE in no time!"

GuitarStv

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Re: Are most of the members here high earners?
« Reply #14 on: March 27, 2014, 12:49:01 PM »
What do you consider a high earner?

EconDiva

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Re: Are most of the members here high earners?
« Reply #15 on: March 27, 2014, 12:57:41 PM »
What do you consider a high earner?

An individual income in the 90's or higher.

warfreak2

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Re: Are most of the members here high earners?
« Reply #16 on: March 27, 2014, 01:03:25 PM »
An individual income in the 90's or higher.
My income is roughly 1/4 of this. I do have quite a lot of free time, though...

peppermint

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Re: Are most of the members here high earners?
« Reply #17 on: March 27, 2014, 01:21:07 PM »
Low earner here by those standards. I just finished a PhD program and am in an academic postdoc. I've never made a high salary.

I try not to compare to high earners, I love the creativity, flexibility and intellectual stimulation of my job and am in a stable position, at least as far as the academic job market goes.

I have enough to live on, I am paying off my relatively minor debt on an accelerated schedule, and I make more than many people do. I try to cultivate the mindset, "I have enough" for my own happiness.

lexie2000

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Re: Are most of the members here high earners?
« Reply #18 on: March 27, 2014, 01:33:12 PM »
DH was what I guess you would call a high earner before he retired, but he didn't break the six figure mark until late 2005.   He was not an engineer or IT guy; he was in finance and administration, but we lived in HCOLA and VHCOLA areas.

For the majority of his career we were a single income family.

Like others have said, it's what you save that's important.  The less you can learn to live off of, the more you'll save and the less you will need to live off of in retirement.  I think the most expensive issue going forward for retirees will be the cost of health insurance and health care.

dragoncar

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Re: Are most of the members here high earners?
« Reply #19 on: March 27, 2014, 01:39:10 PM »
The beauty is that it's not how much you earn, but how much you save.

http://www.mrmoneymustache.com/2012/01/13/the-shockingly-simple-math-behind-early-retirement/

This is true, but I'm not gonna lie -- it's far easier with a higher income.

Based on the 90k individual income definition of high-earner, and recent polls, I'd say not "most" but "many" here are high earners.  You might notice it more, since those people may be more vocal.

La Bibliotecaria Feroz

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Re: Are most of the members here high earners?
« Reply #20 on: March 27, 2014, 02:02:01 PM »
Just to make any other low earners feel less alone:  We qualified for the EITC this year. (Housing is provided gratis by husband's employer, so we are much better off than that sounds.) He's a teacher, I made under $10K working from home (and spent most of that on day care--two toddlers, part-time child care saves my sanity).

rubybeth

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Re: Are most of the members here high earners?
« Reply #21 on: March 27, 2014, 02:14:05 PM »
What do you consider a high earner?

An individual income in the 90's or higher.

We don't even make that much combined (married, no kids). :)

Cassie

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Re: Are most of the members here high earners?
« Reply #22 on: March 27, 2014, 02:29:19 PM »
We had about 8 years where hubby was high earner.  However, between us we have had 3 divorces which really saps the income.  I agree the more you earn the easier it is but we saved a lot of $ when young on lower incomes by being frugal.

payitoff

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Re: Are most of the members here high earners?
« Reply #23 on: March 27, 2014, 02:29:37 PM »
i found this site in 2012 when we are still in the middle of a one-income household while husband is in school full time, i read and read and swear to myself to come back when we make more income. its true that the higher the income the better, coz back then i couldnt even figure out a way on where to cut down coz were pretty much strapped to the core just to make ends meet, 2 years later and now income has tripled, i am back and working our butt off towards FI.

i am mid 30s by the way and also hoping to get ahead by 55, 20+ years is a long time still, we can do this!!!

fantabulous

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Re: Are most of the members here high earners?
« Reply #24 on: March 27, 2014, 03:05:06 PM »
Low eearner by those standards (~50k/year), and still clawing my way out of debt. I don't fuss over getting to the point where I start making my own monocles* and buying several investment properties/etc. I might get there some day if I stay the course, and great if that happens.

I'm in a somewhat similar situation to the OP. 31, two time college dropout, didn't really get on my feet until I was 26/27. The whole point is to make a better life for myself and those around me, not as a competition.

* Monocles are required above a certain net worth, right?

warfreak2

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Re: Are most of the members here high earners?
« Reply #25 on: March 27, 2014, 03:08:15 PM »
* Monocles are required above a certain net worth, right?
Moustaches.

happy

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Re: Are most of the members here high earners?
« Reply #26 on: March 27, 2014, 03:31:31 PM »
It might be just what you notice. As a defined high income earner, I always think I am one of the minority and that this board is mainly populated by those under that income!

The beauty of the shockingly simple math is it works at any income level, but I agree its easier/faster with a higher income.  Although as we've seen here from the occasional poster, high income jobs often come with trappings/expectations of ridiculous consumption that takes the ability to be strongly internally directed to resist.

As for age, its never too late. I'm 55, hoping to retire at 60,  and if I live to 100, (who knows, there are some long livers in my family) then I've still got 40 years to plan for, quite long enough.

wtjbatman

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Re: Are most of the members here high earners?
« Reply #27 on: March 27, 2014, 03:39:43 PM »
All you need to do is look at the income poll thread and you can see how prevalent high earners are here. What's a high earner? Well IMO if the average American family earns just over $50k a year, then above that is high. Higher anyway :) It makes sense that people with higher incomes would gravitate to a website devoted to saving and investing, since people with more income have more to save and invest.

Lower earners like us (35k a year here, not married, no kids) honestly have to be the uber savers, or close to it. We're the people who cut back on every expense, and come out of it with an extra grand a month to save. Compared to some people here who post about saving $4000 a month and being despondent about how far away FIRE seems. We can still save enough to FIRE, we just no room for that boat or car or expensive yearly vacation "because I deserve it". In the end, I know I'm saving enough to FIRE, because I also know I live in a low COL area and I know what it takes to live off $1200 a month here.

rescuedog

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Re: Are most of the members here high earners?
« Reply #28 on: March 27, 2014, 03:44:03 PM »
Am I the only electrical engineer around here who makes under $50k?

Perhaps not, but I'll bet I'm the only engineer around here who makes under $50k and loves his job.

I am an engineer as well and I make just under $50k.  I'm in university research.  I love my job as well!

My husband makes 2x more than I do however.
« Last Edit: March 27, 2014, 03:54:06 PM by rescuedog »

Ottawa

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Re: Are most of the members here high earners?
« Reply #29 on: March 27, 2014, 03:48:16 PM »
Fairly high earning here...

Net worth zero to 700K over the last 7 years.  Combined net salaries went from 113,299 in 2007 to 137,994 in 2012.  2013 was sort of anomalous (211,323) due to severance pay and out-of-contract back pay..but also my SO started back fulltime.  We hope to be FI in 3.5 years at 45.  We need to get liquid portfolio from current 360K to 800K for this to happen...  So, on these incomes it would be certainly possible in 10 years to go from zero to FI with a paid off house and passive income of $32K.  Our current annual spending is at 30K. 

happy

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Re: Are most of the members here high earners?
« Reply #30 on: March 27, 2014, 04:37:03 PM »
Quote
In the end, I know I'm saving enough to FIRE, because I also know I live in a low COL area and I know what it takes to live off $1200 a month here.

And why your contribution is very valuable because you know how to do it. I'm hoping this doesn't become a high income board because I want to learn from the low income earners.

Roland of Gilead

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Re: Are most of the members here high earners?
« Reply #31 on: March 27, 2014, 04:44:13 PM »
Am I the only electrical engineer around here who makes under $50k?

Perhaps not, but I'll bet I'm the only engineer around here who makes under $50k and loves his job.

Probably.  While you are making $50K designing 8 layer boards with blind vias, the other electrical engineers went into software engineering and make $250K.  Sad.


 

EconDiva

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Re: Are most of the members here high earners?
« Reply #32 on: March 27, 2014, 04:47:16 PM »
Quote
In the end, I know I'm saving enough to FIRE, because I also know I live in a low COL area and I know what it takes to live off $1200 a month here.

And why your contribution is very valuable because you know how to do it. I'm hoping this doesn't become a high income board because I want to learn from the low income earners.

+1. 

It's posts like yours that remind me I'm not pushing myself as much as I could be. I think I need to get more aggressive in scrutinizing my outflow each month, and seriously consider the consequence each purchase I make or do not make will have on my goal of being FI. 
« Last Edit: March 27, 2014, 04:49:42 PM by EconDiva »

NinetyFour

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Re: Are most of the members here high earners?
« Reply #33 on: March 27, 2014, 05:02:50 PM »
My gross annual income is about $90,000.  Sounds like a lot--and it is.  But I still kind of feel like I am broke, in a way.  This is because I still have $262,000 of debt (mostly mortgage).  I spend very little of my income on "stuff".  So far this year, my take home pay has been just over $14,000 and, aside from my debt repayment, I have spent about $2000.  I'm so so so glad that I spend so little--it means that I can be debt free in about 6 years.

Thegoblinchief

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Re: Are most of the members here high earners?
« Reply #34 on: March 27, 2014, 05:13:45 PM »
Combined income of under $70K on 1.25 incomes (and my .25 is commission) and 3 kids.

Currently have a negative net worth, but our savings rate is high enough we will FIRE within 15 years.

Cheddar Stacker

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Re: Are most of the members here high earners?
« Reply #35 on: March 27, 2014, 05:48:42 PM »
What do you consider a high earner?

An individual income in the 90's or higher.

This is a fairly high standard IMO. Whatever your standard is, it's really all about the savings rate anyway, but I guess it still puts things in perspective to know what most people earn.

Check out this link:
http://finance.townhall.com/columnists/politicalcalculations/2013/09/29/what-is-your-us-income-percentile-ranking-n1712430/page/full

Your individual income threshold of $90K easily puts that earner in the top 10% of the US based on census data. I read a few years ago that based on 2010 tax return filings a combined household income of about $92K would put you in the top 10% of all US households, but I'm sure that's a bit stale now. This link has a combined table as well, but it appears to be based on census data which I suppose is then inflation adjusted??

Based on everything I've read on this forum, I think it's a very, very wide range of incomes from $10K to $1M annual income. I think the poll Eric linked above from a few months back supports that as well.

Based on the $90K threshold my wife and I were both low earners until around 2009 when I crossed over, so I guess we've been low earners the majority of our careers.

johnintaiwan

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Re: Are most of the members here high earners?
« Reply #36 on: March 27, 2014, 09:42:03 PM »
my wife and I make a combined total of between 35-40K a year. that is probably average for where we live.

Guizmo

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Re: Are most of the members here high earners?
« Reply #37 on: March 27, 2014, 10:26:52 PM »
I made 40k in New York and saved 20k.

I live in Colo and I make the same. I Save 75% pretax.

Kaminoge

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Re: Are most of the members here high earners?
« Reply #38 on: March 28, 2014, 03:22:12 AM »
I'm a teacher. Pretty sure that means I'm not a high income earner...

Squirrel away

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Re: Are most of the members here high earners?
« Reply #39 on: March 28, 2014, 03:28:46 AM »
We have an income in early $80k but it does seem like there are a lot of higher earners on here.

Why are there so many engineers on here?:) I'm from the UK and don't really understand the cultural significance of being an engineer in the US.

rubybeth

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Re: Are most of the members here high earners?
« Reply #40 on: March 28, 2014, 06:50:32 AM »
We have an income in early $80k but it does seem like there are a lot of higher earners on here.

Why are there so many engineers on here?:) I'm from the UK and don't really understand the cultural significance of being an engineer in the US.

It's probably not culturally significant, but MMM himself was an engineer, and his outlook tends to resonate with engineers.

Squirrel away

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Re: Are most of the members here high earners?
« Reply #41 on: March 28, 2014, 07:01:16 AM »
We have an income in early $80k but it does seem like there are a lot of higher earners on here.

Why are there so many engineers on here?:) I'm from the UK and don't really understand the cultural significance of being an engineer in the US.

It's probably not culturally significant, but MMM himself was an engineer, and his outlook tends to resonate with engineers.

Oh right! I think I did know that on some level, it's been a while since I read his back story.:)

Silvie

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Re: Are most of the members here high earners?
« Reply #42 on: March 28, 2014, 07:08:11 AM »
I'm a freelancer so my income varies, but it's around $40K

EconDiva

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Re: Are most of the members here high earners?
« Reply #43 on: March 28, 2014, 07:09:47 AM »
I made 40k in New York and saved 20k.

I live in Colo and I make the same. I Save 75% pretax.

How did you do this?? Please share.

EconDiva

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Re: Are most of the members here high earners?
« Reply #44 on: March 28, 2014, 07:16:35 AM »
Fairly high earning here...

Net worth zero to 700K over the last 7 years.  Combined net salaries went from 113,299 in 2007 to 137,994 in 2012.  2013 was sort of anomalous (211,323) due to severance pay and out-of-contract back pay..but also my SO started back fulltime.  We hope to be FI in 3.5 years at 45.  We need to get liquid portfolio from current 360K to 800K for this to happen...  So, on these incomes it would be certainly possible in 10 years to go from zero to FI with a paid off house and passive income of $32K.  Our current annual spending is at 30K.

Zero to 700K in 7 years is also pretty amazing. You say your current annual spending is 30K. Would you say this was also your average spending during the majority of those 7 years? I would assume it was pretty low in order for you to accomplish that much in a fairly short period of time.

skunkfunk

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Re: Are most of the members here high earners?
« Reply #45 on: March 28, 2014, 07:21:26 AM »

The beauty of the shockingly simple math is it works at any income level, but I agree its easier/faster with a higher income.  Although as we've seen here from the occasional poster, high income jobs often come with trappings/expectations of ridiculous consumption that takes the ability to be strongly internally directed to resist.


I'm not a high earner, and my bosses seem quite annoyed by my biking to work.

skunkfunk

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Re: Are most of the members here high earners?
« Reply #46 on: March 28, 2014, 07:30:39 AM »
We have an income in early $80k but it does seem like there are a lot of higher earners on here.

Why are there so many engineers on here?:) I'm from the UK and don't really understand the cultural significance of being an engineer in the US.

A professional engineer (PE) in the U.S. has a college degree, years of experience, has passed the required tests, and is entrusted with supervision of items critical for public safety. That said, the term is losing some of its punch lately as it is being applied to fields where none of this is the case. Technically, in my state (Oklahoma), one must meet these requirements to call themselves a professional engineer. For instance, I must call myself an engineer intern because I have not met the experience requirement to take the final test.

Squirrel away

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Re: Are most of the members here high earners?
« Reply #47 on: March 28, 2014, 07:40:58 AM »
We have an income in early $80k but it does seem like there are a lot of higher earners on here.

Why are there so many engineers on here?:) I'm from the UK and don't really understand the cultural significance of being an engineer in the US.

A professional engineer (PE) in the U.S. has a college degree, years of experience, has passed the required tests, and is entrusted with supervision of items critical for public safety. That said, the term is losing some of its punch lately as it is being applied to fields where none of this is the case. Technically, in my state (Oklahoma), one must meet these requirements to call themselves a professional engineer. For instance, I must call myself an engineer intern because I have not met the experience requirement to take the final test.

Oh okay, cool. I don't think I have ever met an engineer over here.

arebelspy

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Re: Are most of the members here high earners?
« Reply #48 on: March 28, 2014, 07:52:38 AM »
I'm a teacher. Pretty sure that means I'm not a high income earner...

+1

What do you consider a high earner?

An individual income in the 90's or higher.

The wife and I don't make that combined (for our base salaries - we do extra work like summer school and tutoring that push us up there, but still not even close for our individual income).

Yet we'll ER in our early 30s with a 50k+ annual income.

As others have said, it's all about your savings rate.  We don't make a lot, but we save nearly all of it.
We are two former teachers who accumulated a bunch of real estate, retired at 29, spent some time traveling the world full time and are now settled with three kids.
If you want to know more about us, or how we did that, or see lots of pictures, this Business Insider profile tells our story pretty well.
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Ottawa

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Re: Are most of the members here high earners?
« Reply #49 on: March 28, 2014, 07:54:13 AM »
Zero to 700K in 7 years is also pretty amazing. You say your current annual spending is 30K. Would you say this was also your average spending during the majority of those 7 years? I would assume it was pretty low in order for you to accomplish that much in a fairly short period of time.

Unfortunately I didn't keep strict records until coming into the MMM fold - So, I only have spending data since Oct 2012.  I am fairly confident that 2012 spending was 35K - The last rolling year is 32K - We are on track for 30K this year.  A large part of this is the reduction in childcare expenses - These went from $700 per month to $220 since full day senior kindy started in Sept 2013.  Now we only pay for 1 hour after school each day ($12). 

While we've always been frugal...I wouldn't be surprised if our spending was closer to 40K in the earlier years (lots of home reno, inefficient spending etc).  We did pay off our 180K mortgage in about 6 years (2006-2011).