How My Income Stacks Up

A month or so ago I told you all about how my net worth stacked up against people at the same age and income as me. Well, now there's a nifty calculator that allows me to do a similar comparison with income.

This piece from Slate has a calculator about halfway down that's titled "where do I stand?" You put in your zip code and your income and out pops an income comparison between you and those that live in your area of the country and world. Here's a summary of where I net out:

• I make roughly four times more than the average/median income in my zip code, state, and country.
• 96 percent make a lower income than I do.

Before we proceed, let me say that this isn't about bragging. It's about (like this blog has always been) what I'm doing financially and why I advocate certain moves and not others. It's also about me sharing as much about my personal finances as I feel comfortable with (this is, after all, a blog.) So let's forget the size of the income for now and focus on what conclusions we can draw from it.

Here are my specific thoughts:

• The way I have increased my income should not come as a surprise to anyone. I've focused on growing my career, starting with getting a great degree and then taking specific steps to maximize my income. I've developed a standard formula for doing this and it's been working for me for 20 years.
• In addition, I've grown my side income. At various times I have made extra income as a writer and blogger (though I give away all the proceeds from FMF) as well as through various other pursuits.
• I've controlled my spending and living expenses as my income has increased, widening the "savings gap" between income and expenses (one MAJOR key IMO: I haven't had a mortgage for YEARS.) It's this ever-growing gap that has allowed me to save and give as I've wanted to.  
• I've been saving for quite some time now, which is a boon for my investments. If I can keep this up I'll be looking at early semi-retirement sooner rather than later.

In the end, the keys to becoming wealthy are fairly simple -- grow your income, save, and work to maximize your investments. It is these simple principles that have served me well for a couple decades and ones I hope do the same for you over time (unless you're Old Limey, of course -- he's well ahead of us all financially and doesn't need the help.) ;-)

Comments

[Money Reasons]

I'm only around 75%, so I've neglected my career potential quite a bit... at least I have made up for it a bit by being frugal and debt free!

[texashaze]

@Money Reasons -- I think you make a great point. Financial freedom is really spending less than you earn and staying debt free. Maximizing income is a bonus but not necessary. However I must admit the benefit of maximizing income sure is nice. But in all honesty the most important is debt free living.

[Everyday Tips]

I agree with Money Reasons in that not being a 'spender' is key for building wealth. Building income and saving is a huge part as your income potential is unlimited. But if you spend as much as you make, it doesn't matter what your income is.

We come out very well on the calculator. However, I don't feel wealthy by any means!

[Old Limey]

Average --- $75,800
Median ----- $61,021
% earning less --- 98

My last company paycheck was in September 1992, and we live far below our current income.
The most important two things are "Health" and "Being in a loving relationship".

[Lynn]

There is not info for my zip code in NJ. Oh well!

[BrianF]

Average income in zipcode: $45,460
Median income in state: $43,508
Median income in country: $52,059
Percentile in country: 76
Age: 34

[TR]

FMF do you report your blog income when you are doing your taxes?

[FMF]

TR --

Yes, of course. Though my income stats above don't include blogging income.

[sammysosa]

With OT and bonuses, I'm at 77, but without my wife working. I make up for it by saving 30% of my gross income though.

[TJ]

Average income in zipcode: $47,700
Median income in state: $61,021
Median income in country: $52,059
Percentile in country: 56

[Mike Hunt]

This calculator doesn't work for non-US areas as you need a US based zip code.

If I used my last zip code from when I last lived in the US then it gives within the top 2%. However anything over $250k a year is in the top 2% and it appears to be true for all zip codes...

-Mike

[BD]

Average income in zipcode: $59,910
Median income in state: $56,633
Median income in country: $52,059
Percentile in country: 3 (Percent of people making less than $5,000 a year.)

Go me! :P

[David E]

Can you confirm this is household income not individual income ? Based on other surveys I have read, these numbers appear to be based on household income and individual income would be less.

[jason]

I agree with David E. I follow the census data of my area fairly closely since it explains a lot of geographic qualities in my mapping work and the numbers appear to be household income vs individual income.

[El]

Yes, I also wonder if this is 1) household or 2) income-earning individual (adult) or 3) per capita. If per capita, I am ridiculously at the low end of the percentile for my zipcode! If per household we are close to the median w/ our two incomes.

[texashaze]

Average income in zipcode: $91,530
Median income in state: $50,043
Median income in country: $52,059
Percentile in country: 97

These statistics are interesting. It should also include a cost of living number and then look at that ratio with your income.

[Robocop77]

I'm in the 93rd percentile!

Is interesting that we are all celebrating here how responsible we've been with our finances when the goal of the Slate article is to make us feel guilty because of the great "inequality" that exists in the US. Ha!