In today’s episode, I demystify earning $100K. There is a lot of buzz around earning $100,000 right now. But depending on where you live, your season in life, and your lifestyle goals, that salary milestone won’t stretch as far as you think.
The best emotion you can bring to your finances and around money is curiosity. So often, my clients come to me with goals and financial principles based on what they’ve heard from friends, family, or social media. To overcome financial overwhelm and achieve worry-free spending, it is important to understand the role of a dollar in your life.
Once you understand why you want to make more money, it becomes easier to create a budget and salary goal. So as a coach, I want you to think about what making $100K means for you and how that will really impact your life. I encourage you to get curious about the role money has in your life now, and how you want it to align with your values in the future. For many people, this analysis means shifting their goal salary from $100,000 to $200,000 or even $250,000.
Are you ready to dive deep and discover the role of a dollar in your life? Let’s get started.
While listening to this episode, start thinking about the answers to these questions…
[00:04:58] How does money help me in my life? What can I do with $100K?
[11:07] Think about earning $100,000. What other things might I need to consider? Am I in a high cost of living area? What other changes are happening in my life in the next year? Are there any financial goals that I’ve been saying that I want to accomplish?
Tune in to this episode of Money Files as I demystify earning $100k.
Are you ready to start asking for help with your finances? Apply to work with me, and let’s start working towards your financial goals.
IF YOU LOVED THIS CONVERSATION ON DEMYSTIFYING 100K, CHECK OUT MY EPISODE ON NEGOTIATING FOR THE SALARY YOU DESIRE & DESERVE WITH KIM TRAN!
Transcript for “ DEMYSTIFYING 100K”
Hi and welcome to Money Files. I’m Keina Newell from Wealth Over Now. I work every day with professional women and solopreneurs to help them get out of financial overwhelm and shame so they can experience more flexibility and ease with their finances. Are you ready to gain confidence and learn to manage your finances intentionally? Tune in and grab financial tips that will help you master the way you think about and manage your finances.
Hello and welcome back to another episode of Money Files. So something has been on my heart lately to talk about, and there’s plenty of number of things on my heart to talk about, but I’ve actually been seeing a lot of posts on social media talking about like, what does a hundred thousand dollars mean in certain areas of the country and where you live? And this could be, like, I have clients that are international, so it could apply in that situation. It could apply here in the United States.
I reside in DC which is a very high cost of living area. I actually have a client of mine that I had been joking with her because her and her husband like, have a date night. And I’m like, is that all you paid to have dinner with your husband? Like I feel like I could only get like an appetizer for that amount. So depending on where you are, money means different things. Money spins differently. And so I wanted to go in and have this conversation with you because I want you to be thinking about what does money mean in my area of the world? What does money mean in my season of life? And just like I think the best emotion that you can bring to your finances and around money is curiosity because I think there are a lot of things that we do with our finances that are just based off of things that we’ve heard.
And so one of the things that I’ve been wanting to talk about is like demystifying 100K and I feel like making 100K, like my parents never made 100K and making a 100K, I felt like, oh gosh, when I make a hundred thousand dollars, I am going to have so much money. Or I even think about the fact that like as a child, I wanted to be a pediatrician. And even when I went to college, I wanted to be a pediatrician. And you know, doctors make a lot of money. That’s what I remember hearing as a kid. And so when I went to college, one, my parents didn’t know a lot about student loans, but one of the reasons I took out student loans and didn’t care about the amount of money that I took out is because I was like, I’m going to be a doctor. Doctors make good money. And so I think about how that thought impacted how I was thinking about what I was doing with money and what I would be able to do with money.
Fast forward and I have friends now that are pediatricians turn life coaches and they tell me like, oh yeah, I made $150,000 in my practice, or I made $120,000 in my practice and now I could be like, oh my goodness, you don’t make any money. You did all that school, you have all those student loans and you are not making any money. But you couldn’t have told the 18 year old version of me that making $150,000 or $120,000 wasn’t a lot of money. And so I think that if you are like myself, you might be thinking like a hundred thousand dollars is a lot of money, especially if you have parents that maybe have never made a hundred thousand dollars and they’ve probably shared thoughts with you about what you would be able to do making a hundred thousand dollars a year. And so I use a hundred thousand dollars because I feel like that’s the breaking point of the six figure mark.
And so people want to get to a hundred thousand dollars and you may be at 110 or 120 or I even have clients that make significantly more than a hundred thousand dollars. But I really just want to demystify for you what 100K means in your life. I want to help you think about what does 100K mean for you in your life or really any amount of money. Because what I find with clients, especially clients that haven’t made a hundred thousand dollars or maybe just started making a hundred thousand dollars, is that like they never talk about making $200,000. They don’t talk about making $300,000. They generally stop at making like, I’m making $105,000. And for me, I’m like, you have a money ceiling and there’s something there for you that you’re not investigating. There’s something there for you that you feel like you’ve arrived at this point. And so I always want people to be thinking about money in more expansive ways, but I also want you to be thinking about it in a critical way in the sense of like, how does money help me in my life?
What can I do with this money? And just being able to be curious. I don’t want you to do this from a place of judgment. I don’t want you to do this from like shame. I just want you to be curious because I think that once you allow yourself to be curious, you may have some new financial goals for yourself. Like you still get to be grateful for where you are. But then you might start thinking like, oh, let me choose to think differently about my finances now that I understand what the role of a dollar is in my life. And I’m talking about this in somewhat of a budgeting sense, but I just mean like when you talk about the next amount of money that you want to make, what is that number? Why is it that number? What does that number do for you? Like I don’t think we’re having those types of conversations or those conversations are in smaller circles.
And you may not be in those circles because you and your friends may all talk about money in the same way. And so just thinking about what’s the role of a dollar in your life, talking about 100K demystified, I mean, I can tell you in making 100K, some of you are going to have your feelings hurt because it’s not as much money as you thought it was going to be or maybe you’re already there and you’re like, dang, I’m making a hundred thousand dollars and I still feel like I’m looking for where the money is that I can save or pay off debt. And so I just want you to be able to think about money in a different way and also know your own history with money. Like I was thinking about myself and I was thinking about the fact that I did not become a pediatrician, obviously. And I actually joined Teach for America after college. And so I got into education. Educators aren’t paid a lot, but I started making I want to say it was like $33,000 a year and maybe it was about 36 when I left St. Louis. I taught there for two years.
Then I moved to DC because I wanted to make a career move still in education and I was making $55,000 a year. And so this is like my first realization that you can make more money and it not feel like a lot, but when I went from making $33,000 a year to $55,000 a year, what also happened was my rent increased like almost triple of what I was paying in St. Louis. And so yes, I was making more money, but that money was going out, it was being spent, my student loans were due. And so my finances looked a lot different even though I was making more money. Then I got closer to $80,000. And when I was making about $80,000, was also the time in which I decided to buy a home. And so still once again, I’m making more money. However, buying a home, it was my mortgage payment was about $300 more than my rent. So like with my mortgage HOA, I was paying about $2,100 a month.
And so that was making like $80,000 a year. And then I went from like 80,000 to I want to say like low nineties. And then I went to making like 110, 115. I was in school leadership. So I’m telling you all of this because there are a couple different things that can impact a 100K. One, you have things in your life that are going to be happening, right? Like I told you, like I moved, I moved from one state to another, so that can impact your money. Then even though I was in the same state as I was in teaching and my teaching salary increased, what was happening is like my cost of living was increasing. So for one year to the next, I had to expect rent increases, so my pay would increase, but I felt like my pay increased just enough to cover my apartment rent going up like $100 to $200 a month. So that was happening. So there was more money going out, then I decided to buy a home, which meant that I had additional expenses.
So as you’re making more money, it may not feel like you’re making more money, but also you have to understand that one of the reasons that that’s true is because your life is shifting and it’s not bad that your life is shifting. You’re not always going to live like the 23 year old version of yourself. So when I’m talking to clients, one of the things that I work on in my five month coaching partnership is getting them to think about the life that they desire to live. Like you are not always going to be making $50,000. You’re not always going to be making $80,000 or a hundred thousand dollars. You’re not always going to have three roommates. You won’t always have a life where you don’t have kids. And so you may not always have a job where you’re working 60 hours a week. So what else or how else would you be spending your time? And so we’re getting people, like in my five month coaching partnership, I want people to be thinking outside of the box they’re in right now.
And so oftentimes the only thing that people can see when they’re working with me is how bad their situation is or how bad they feel about their situation, whether it’s like their thoughts about how much money they don’t have saved or their thoughts about how much money they don’t have in retirement or their thoughts about the debt that they’re in or the thoughts about the pricing in their business. And so they haven’t created space for them to think about this future version of themselves. And so when they do hit new financial milestones, if they’re not working with me, then those financial milestones in terms of how much money they’re making may not feel the way they thought they would feel. And that’s only because they never align their vision, their financial vision in a way that like aligned with their life. So one of them kind of got stuck and frozen in time.
They’re like, oh, I want to make a hundred thousand dollars. But they didn’t account for the other things that as a hundred thousand dollars earner that they would be doing or like if you wanted to make a hundred thousand dollars by the time you’re 28, what does your life look like at 28? It may not look like it looks at 23. So I help my clients close the gap so they understand these incremental changes in their life. And so today, if you are someone you’re like Keina, I want to make a hundred thousand dollars, I do too, but I also probably want you to make more than a hundred thousand dollars because I know there’s a type of life you think a hundred thousand dollars will allow you to live. And I want to make sure that your salary aligns with that life that you desire to live. And so this is true for someone working in nine to five. It’s also really true as a business owner because when I made the shift from working for someone else to working for myself, a hundred thousand dollars was definitely not the hundred thousand dollars I was making when I was employed by someone else.
When I was employed by someone else, they took out my taxes, they gave me a net paycheck and I was fine. Like it was very clear cut and dry. But as a business owner, I had to incorporate new things. I had to think about my business expenses. I had to think about saving in my business. I had to think about taxes. I have to think about, okay, now what’s left after those things? And how much can I afford to pay myself? So if I had to just set a goal of a hundred thousand dollars and not thought about those other things, then I could be definitely disappointed or have a big tax bill at the end of the year because I hadn’t thought about how I was going to fund these other areas of my life. So I’m going to break this down in two different ways and I want you to think about if you were someone who is like, yes, Keina, I want to make a hundred thousand dollars or any amount of money that you want to make, I want to offer you several questions that you can ask yourself so that way the money that you have your eyes set on making or that you have set in your financial goals, I want that money to feel like something to you.
I want you to feel the impact of that. And so part of feeling the impact of that is yes, like let’s make sure that we have a budget, we’re spending money in the way that we know how or want to, but then there’s also the part of it where it’s like, hey, let’s be realistic with actually being clear on what’s the number that’s going to come with me. Let me actually forecast and make projections for how much money I think I will have and also be clear on how much money I think I will need. And so if you can wed those two together, then it’s going to put you in a place where like when you get a raise at your job or when you go to negotiate a salary at a new role, if you decide to move across country, if you decide to buy a house, that you’re going to be very clear on what your numbers are. Another reason I want you to do this exercise too is because oftentimes I see people that like you get a $20,000 raise and then you go and start doing things like you get a bigger apartment, you get a nicer car.
You do these things, but you don’t actually understand the number that’s going to be coming to you in your paycheck. And so one of my favorite things to teach my clients is how to plan in advance because then you’re not going to be blindsided by the things you think you knew. And even if a number’s off, it’s off by like $50, it may be off by a hundred dollars, but when you have a plan, you know how to account for it versus just kind of going into that situation blind. So thinking about a hundred thousand dollars. First, I want you to think about whatever that number is for you. Like am I thinking about this number in my business? What other things might I need to consider? Am I in a high cost of living area? What other changes are happening in my life in the next year? Are there any financial goals that I’ve been saying that I want to accomplish? Maybe you want to buy a house. Maybe you want to be able to pay off debt. Maybe you want to build a six figure savings. Maybe you want to fully fund your retirement. Or maybe you like in a situation where like you’re getting ready to get married or you’re getting ready to have kids.
Like think about those things that are happening as you’re kind of thinking about this next financial goal for yourself and how much money you want to create. And so like, is that in your business or is that in nine to five? And the first thing I want you to answer for yourself after you kind of get clear on where you are in your life is why do I want to make a hundred thousand dollars? And so you’ll keep hearing me say a hundred thousand dollars, but if your number’s $150,000, $200,000 or $500,000, go ahead and fill in the blank with that. But like, why do I want to make this amount of money? Answer that question for yourself. What do you think it will create for you in your life? What do you want to be able to do in your life? This is a great place to insert your values. I want to be able to give money to other people. I want to be able to start a savings account for my niece and nephew. But like get really clear. Like why do you want to make that amount of money?
Maybe you’re like, I’ll have less financial stress, but what does that mean? Like I’ll be able to pay all my bills on time. I’ll be able to save consistently. Like get clear on what that means. How much do you think you’ll be able to save? Alright, maybe you think you’ll be able to buy a house. How much is that house? What are the mortgage payments on that house? But get clear. And then what we’re going to think about is like, how much is a hundred thousand dollars in my life? So from here it’s really asking yourself the question like, what does this number mean in my life? Like what would a new budget look like? Those are all different flavors of that same question. And one of the things I love to do with clients, and I will tell you that this is not a proven, proven formula, but it’s one that I’ve used pretty successfully in my own life. So I’m going to give it to you to borrow because it gets me fairly close to where I need to be.
But if I have a client that comes to me and we are talking about, okay, I’m making a hundred thousand dollars, I’m going to make $120,000. Like that’s what the job offer is for, or the job that I’m seeking, what I ask them to do is consider how much money they want to be able to put into retirement. And so I’m always getting people to think about like, are you maxing out your retirement yet? So in this case, I might ask someone, okay, you have a hundred thousand dollars. Let’s say that you need $22,000 to max out your retirement. So after you’ve done that, this offer is no longer a hundred thousand dollars. It’s 78,000 in terms of the money that’s going to come to you, right? So now it’s $78,000. Then we all know that Uncle Sam wants his money and you also have to pay into healthcare. And healthcare is one of those things that looks different for a lot of different people. Like some companies, you don’t have to pay anything in healthcare that is just all covered by your company.
In other companies, healthcare is something that’s really expensive and companies don’t cover a lot. So then what I generally ask people to do is like just assume that the government’s going to take anywhere from 30 to 35% of that money. So you’ve done your max contribution, it’s $22,000, they’re going to take probably 30 to 35% of what’s left over. So in this case, I’m like using 35% just to account for like taxes, any dues that may be due with who you work for. Or also thinking about like health insurance. So now we’re talking about this person making $51,000 in terms of their net that’s coming home. And so the other thing I always ask people to consider is like, if this is a different job, are you getting paid 24 times a year, which means you’re getting paid twice a month or are you getting paid 26 times a year, which means like are you getting paid every other week?
And those are important things to know because your paycheck looks different if you get paid 24 to 26 times and know those extra two paychecks, they’re not extra, you should do the same thing with them. But now we’re talking about different numbers. Now we’re like, okay, well now I’m talking, if I get paid 24 times, then my paycheck’s going to be about 2250. If I get paid 26 times, my paycheck’s going to be 1961. So now I can look at those numbers and be like, okay, what does this number look like for me in a budget? If you are going from 80 to 100K and you’ll be like, dang, that’s maybe not as much money as I thought it was going to be because like I said, I wanted to fully contribute to my retirement. Then when I thought about taxes, like this number looks different. So it may not position me in the way that I thought I want to be positioned. But it’s not for you to get discouraged, it’s for you to be informed.
Now you might start thinking, well what happens if I make more than a hundred thousand dollars? What happens if I make $150,000? And so you can do the same thing. You’re like, alright, I have $150,000 and I’m going to subtract the $22,000 that I know I’m going to put into my retirement. And after that, well I know that I have like $128,000. Okay, this is sounding better because the last time I only had $78,000. And so from there, when I think about taking 35% out for taxes, well I have over $80,000 that I get to play with. And so now I’m looking at a paycheck that’s like $3,400 not every other week, but if we were thinking about 24 paychecks. So it’s just like being able to think about what’s happening with the numbers as I make more money. And you can hear me as I’m talking through this, is like when I’m talking to clients, I’m helping them think about the other goals that they have. You said that you wanted to buy a house, you said that you wanted to fully retire, you said you wanted to travel more.
And so what do those numbers look like within your budget? Another podcast that you can go to and listen to is like, I talk about financial visioning and I’ve done that podcast, I want to say once or twice, but it’s a concept that I love to teach clients because it helps them see where they’re going and where they desire to be. It helps them to see like, oh, if I got paid $10,000 net a month, what this would look like. If I got $8,000 net a month, this is what it looks like. If I got $15,000 net a month, this is what it looks like. And so it gives a purpose for the money that they’re creating. It gives a purpose behind like how they negotiate, how they look for jobs, like what they say yes to, what they say no to. And that’s important. Like you want to know why you’re saying yes, you want to know why you’re saying no. You want to know why you desire more and the desire just can’t be to make more money because I want you to be clear on what’s the purpose of money in my life.
And when you know the clear purpose of money in your life, like it’s going to help you feel better about how much money you’re making. And then you won’t just be like, I’m making 100K because it’s like the number I think I’m supposed to hit. I’m like, what does that mean? Who said you can only make 100K? Once again, you probably have some type of money ceiling that thinks you can only make a 100K. Why do you want to make 100K because you heard it was a lot of money, but if you make 100K in LA I can guarantee you it’s not a lot of money. It’s just like they’re accounting for the cost of living. You’d probably be better off going to Ohio and making 60K. So just like being able to question things like that. That’s the other thing, when you’re thinking about this, like do you need to consider a move? That’s where I love, I was mentioning that like cost of living calculator. I want to say it’s CNN. If you type in CNN, cost of living calculator. It’s one of the things I love, love, love to use when I’m like moving in between different states.
And I’ve used it with clients to help us consider like what does writ mean? What does food mean? What do utilities, like, what’s going to change from the state you’re living in now to the state that you’re going to? And so for some people it’s beneficial because they may be going from a high cost of living area to a lower cost of living area, but like I like to be grounded in actual numbers and to see what’s happening. And then the other thing that I will say about this, like if you are a business owner and you’re like, Keina, how does this apply to me? What do I do? I would just say like when you think about setting your financial goals, when you think about setting your financial goals annually, consider that you only are going to pay yourself 50% of what you’re bringing home. And that’s if your business is really profitable and your business will be profitable if you have low expenses. But if you have the goal of making a hundred thousand dollars a year in your business, it may look more like you being able to pay yourself $50,000 a year.
And so maybe you were actually thinking like, dang, I need to make $80,000 in my business because like that’s how much my family needs to live off of months a month. But once again, not to be discouraged, but it gives you, it can give you a clear marker for where you desire to be, for how you need to be thinking about numbers. So the goal could still be to make a hundred thousand dollars, but now you’re saying it with more clarity than just saying, I want to make a hundred thousand dollars because it sounds cool, right? So it might be like, alright I want to make a hundred thousand dollars, then I’m going to go to 150, then I’m going to go to $200,000, like that’s my goal. I’m going to do $50,000 and a hundred thousand dollars. And so you can be thinking about these things as you prepare to build a business that can take care of you as you prepare to scale in your business. Like those are all things that you have to consider.
It’s like how are the numbers going to be moving as I am making more purchases or as I’m thinking about paying myself or as I’m thinking about pricing. If you know you need to make a hundred thousand dollars in your business, like if that’s the goal within the next two years, you get to think about how do I want to price? How many clients do I want to work with? Like what packages do I want to offer? Just changes the conversation. So today is really just about helping you demystify like, what’s 100K? What’s the role of this dollar in my life? And whether you are working on the nine to five corporate side or you’re working in your business, I want you to be able to answer that question for yourself because it’s very important and I want you to go out there and earn more money. And I want you to earn it confidently because you know the purpose of money in your life.
So thank you so much for tuning into this week’s episode, and I would invite you to apply to work with me in my five month coaching partnership. So ideas like this, concepts like this, like demystifying numbers in your life, like this is what we do when we work together one-to-one. Yes, you will get a budget, yes you will have clarity on like how you want to manage your money day to day and week to week, but we actually get to talk about like other concepts and other things that you don’t even know exist beyond saving money and paying off debt. When you’re thinking about like, how do I plan ahead? How do I think about numbers? Like I want to change and reshape your brain so you think about numbers in a different way, in a way that serves you, in a way that makes you feel confident and in a way that allows you to have peace and to be able to take a deep breath. So if you want to apply to work with me, you can go to my show notes or you can go to my website, www.wealthovernow.com/appointment. Or if you just go to Wealthovernow.com, you’ll see the button at the top that says apply to work with me. So it was great talking to you and I will talk to you soon.
Thank you so much for listening to Money Files. If you’re ready to take the next step to reach your financial goals, head to www.wealthovernow.com/appointment and let’s get started.
