I Make Six Figures: Here’s My Monthly Budget
Written by
Andrew Lisa
Edited by
Sean Fisher
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Six figures is an income milestone. Even though $100,000 doesn’t give you much more spending power than $99,000, something about that extra zero makes people feel like they made it — and in a way, they’re right.
Most people will never earn a six-figure salary, but those who do can find themselves in worse financial shape than someone making tens of thousands less if they don’t manage their money well — and sound financial management starts with a budget.
GOBankingRates spoke with a self-made six-figure entrepreneur who shared his budgeting secrets, which follow a familiar formula that he modified to account for his hefty income.
A Tech Entrepreneur Turns a Side Hustle Into Six-Figure Wealth
Abid Salahi is the co-founder of FinlyWealth, a credit card recommendation platform that empowers users with personalized financial solutions — but it’s much more than your standard card comparison site.
Salahi is a techie by trade and training, graduating from college with a degree in computer science. While Finly started as what Salahi calls “a humble mobile app that connected to your existing credit cards,” he used his tech skills to include an advanced rewards calculator lauded for its accuracy and user experience. It offers detailed breakdowns complete with charts and unique features that competing tools lack. The platform leverages actual user spending history through secure bank connections to create custom suggestions for rewards cards based on real-time user data.
Finly started as a side hustle, but as Salahi took it on as a full-time project, he began monetizing it toward a full-time salary.
“My monthly income as a co-founder and equity holder in FinlyWealth averages around $18,000,” he said. “As a tech entrepreneur with a six-figure income, I have significant experience managing my finances and adhering to a disciplined monthly budget.”
Millionaire Mindset: 6-Figure Budgeting for 7-Figure Aspirations
Personal finance experts often recommend crafting a budget as the first step to financial freedom for people who are struggling to get out of debt and build savings. However, it’s just as important for high earners to keep track of every dollar coming in and going out, or they can go broke as easily as someone earning minimum wage.
But Salahi doesn’t want to go broke. He wants to graduate from financially comfortable to millionaire status — and his budget is the roadmap he’ll use to get there.
“From the outset, it’s crucial to understand that substantial income does not automatically translate to sound financial management,” said Salahi. “Budgeting is an essential practice, regardless of one’s income level. In my case, I allocate funds strategically across various categories to ensure long-term financial stability and growth.”
The 50/30/20 Rule, Revisited
The 50/30/20 rule is one of the most popular and basic percentage-based budgeting strategies. It allocates 50% of your income to needs like housing, utilities, groceries, health care, and debt payments. Next is the 30% that goes to wants like dining out, concert tickets, 27 different streaming apps and whatever you need from Amazon this month that you don’t really need.
Finally, the remaining 20% — one dollar in five — goes to saving, which could be an emergency fund, a down payment for a home, a brokerage investment account, a tax-advantaged retirement fund or all of the above.
When You Make Enough To Adjust, Adjust in Favor of Your Future
When you earn $18,000 a month like Salahi — $216,000 a year — you have the luxury of customizing the 50/30/20 rule to keep more for yourself. He had every opportunity to succumb to lifestyle inflation and spend more on wants while still amassing significant wealth. But instead, he tweaked the formula to supercharge his savings.
“I allocate approximately 30% of this amount to fixed expenses such as housing, utilities, and transportation,” said Salahi. That’s 20 percentage points less spent on needs than the standard formula requires.
“Another 20% goes towards discretionary spending, including dining out, entertainment, and travel,” he said. That’s 10 percentage points less spent on wants than the boilerplate 30%.
So, with Salahi spending 50% on wants and needs instead of 80%, where does all the extra money go? “The remaining 50% is divided between savings, investments, and debt repayment, if applicable,” he noted. Instead of saving one dollar in five, his six-figure income allows him to save one dollar in two.
‘Paying Myself First’ No Matter How Often the Budget Changes
If you want to be wealthy, being a little selfish isn’t OK. It’s absolutely necessary.
That’s not to say you should be greedy or obsessed with money. Even if your passion is charity, you’ll never have the chance to give — at least not to your full potential — if you’re living check to check, which you will be eventually if you don’t give your first dollar to the person in the mirror.
“One of the fundamental principles I follow is paying myself first,” said Salahi. “Before allocating funds to any other category, I automatically transfer a predetermined percentage of my income into retirement and investment accounts. This approach ensures that I prioritize my long-term financial goals and prevent lifestyle inflation from consuming my entire income.”
Right now, that predetermined percentage is 50% — but it might not stay that way for long.
“Budgeting is not a static process,” he said. “It requires regular adjustments and adaptations. For instance, during periods of economic uncertainty or market volatility, I may temporarily reduce my discretionary spending and allocate more funds toward building an emergency fund or paying down debt. Conversely, when presented with lucrative investment opportunities, I might temporarily curtail my savings rate to capitalize on those prospects.”
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