Why $100,000 a year won’t make you rich

Updated to Business on December 27, 2022.

I was in a car the other day with a radiologist and a neurosurgeon talking about hypertension. 

This conversation is actually not as unusual as it might sound. I volunteer for a local society that does trail clearing in a popular hiking and mountain bike park and many of the volunteers happen to be recently retired doctors. 

Back in the car, one of the doctors happened to mention that recently his medical partner, who is in his early 60’s, had a mild stroke. As we wound our way further up the dirt road to our work site my education continued. 

I learned that strokes are the second biggest cause of mortality worldwide and the third most common cause of disability. The scary statistics get worse. As you age your chance of a stroke doubles every 10 years after 55

There’s a checklist of health conditions that make you more susceptible to a stroke, like obesity, high cholesterol, and diabetes. But the biggest culprit – six times out of ten – is hypertension or high blood pressure. In my books, that’s worth paying attention to.

What’s interesting is that stress, in itself, is not the direct cause of high blood pressure. It’s what we do when under stress that leads to nasty results. We eat too much, drink too much, and move too little. Basically, we deal with stress by making unhealthy choices.

For me, stress starts with worry.

Ngoc Son Temple, Hoan Kiem Lake, Hanoi, Vietnam

I’ve had a lot of worries

There is a world of problems you can worry about – take your pick. You can worry that Ukraine will be pummeled into a tiny province of rubble, or that we’ve passed the tipping point with global warming, or the tiny spot on your chin is cancer. 

Or not.

“I’ve had a lot of worries,” quipped Mark Twain “most of which never happened.” Our mind loves a good worry. Like a dog chewing a bone, we want to turn our worry around, looking from all angles, poking and prodding until it swells up into something bigger than it really is.

I used to worry incessantly before every keynote speech. I’d worry I’d miss my flight or wasn’t prepared enough, or I would be greeted by the “audience from hell.” Trust me, when you have 60 minutes to educate, entertain, inspire, motivate, and get laughs from an audience you’ve never met before, any sane person would invent a long list of worries.

It was at one of those events when a fellow speaker opened an exit door for my worries. He suggested that audiences don’t want you to fail – in fact, they want you to succeed. “They want to see you having fun—enjoying yourself. That way,” he explained, “they can enjoy the ride with you.”

When I accepted the long list of what I could never control – my flights, the audience, the speaker before me going overtime – I was free to focus on what I could control.

Enjoying the moment. 

What your life will have been

In her book, Comfortable with Uncertainty, Buddhist nun Pema Chödrön tells the story of delighting in the preciousness of every single moment.

A woman is running from lions. She runs and she runs, and the lions are getting closer. She comes to the edge of a cliff. She sees a vine there, so she climbs down and holds onto it. Then she looks down and sees that there are lions below her as well. At the same time, she notices a little mouse gnawing away at the vine to which she is clinging. She also sees a beautiful little bunch of strawberries emerging from a nearby clump of grass. She looks up, she looks down, and she looks a the mouse. Then she picks a strawberry, pops it in her mouth, and enjoys it thoroughly.

Learning what to focus on, and what to ignore, seems to be the ultimate secret to living a healthy, stress-free life. “Whatever compelled your attention from moment to moment,” writes Oliver Burkeman in Four Thousand Weeks (a must-read for anyone over 50), “is simply what your life will have been.”

So, what are you focussing on?

What to focus on

You can learn a lot when you’re the dumbest one in a car full of doctors. I learned that strokes are a silent pandemic. And that hypertension is the leading cause of that pandemic. And I learned the leading cause of hypertension is stress. 

I was also reminded that stress is a choice.

We all have lions and tigers in our life. Maybe even a mouse or two gnawing away at something we value. Meanwhile, we have the moment.

Choosing what to focus on (and what not to) might just be the healthiest choice you can make.

Got this far? You might also like these posts:

Photo of eggs by Nik on Unsplash
Photo of Ngoc Son Temple by author
Photo of tigers by author

Has this title got your attention?

Most experts I consult with would love to earn six-figures. I don’t blame them. The average income in North America is about $50,000. Earning $100,000 puts you in the top 15% income bracket. Not bad.

But, here’s the rub.

As an entrepreneur when you earn more, it costs more. This is the nasty truth of growing your expert enterprise that often gets overlooked in the rush to get your numbers up.

“As an entrepreneur when you earn more, it costs more.”

When you are just starting out you created your own one-page web site for free on WordPress, didn’t subscribe to an email management tools, or CRM, or video hosting. You didn’t belong to a professional association, go to an annual conference, or need a virtual assistant to help post your blog,  or update social media, and do the occasional research project. Life was pretty simple (and cheap).

Then you started to grow your business. And costs go up.

I want to show you how this happens and how you can, with just a bit of work, leverage off your core business, and become richer.


Let’s use a simple contractor scenario: Lynn teaches communication skills as an independent contractor, has been in business for five years, and has a pretty stable client list.

Her fees average $3,500 for a partial for full day contract of teaching and she does 26 engagements a year ($91,000). Of course, you might do more or less than this, but this will give you an idea of my logic.

She also offers coaching at $185/hour. And she averages 72 hours of coaching a year ($9,000).
Her total income is $100,000, before any expenses.

Her monthly costs add up to $21,140 annually for Internet hosting, email management service (like Mail Chimp), Webinar hosting, allowance for annual web site upgrades, virtual assistant, insurance, attending one professional development conference, travel to clients, membership to a professional association, etc. This is probably low (about 21% of gross income), there could also be outsourcing costs, design work, advertising, printing, etc.

Assuming a 25% income tax (to keep it simple I’ll assume she operates as a sole-proprietor and doesn’t have corporate tax and there are no personal allowances or deductions for home office, etc.), she will pay $19,715 in tax.

She is left with $59,145. That’s a pretty good net income (about $5,000 a month after tax) if you were a teacher, or middle manager in some office job. Get the full spreadsheet here.

But Lynn has to create this income every month. She has no pension, no medical, no holiday or vacation pay. Nada, nyet, zero, nothing. And what about investments? Home improvements, A new car every five years, clothing allowance, mortgage, putting a child through university, or any of those other fun things?

“She has no pension, no medical, no holiday or vacation pay. Nada, nyet, zero, nothing.”

She is on her own. Get sick, break a leg, need to take care of Mom? She is out of luck.

Lynn is doing a great job working as a laborer (work more hours, get paid more), but not building an expert enterprise.


Anne ran her business with income simply from speaking and coaching, like Lynn, for a number of years, but realized she wasn’t getting ahead. So she wrote a workbook.

Let’s assume that one half the clients (1/2 of 26 engagements=13) buy the workbook to go along with the seminar and pay $18. Anne nets $12, and with an average of 20 people in the room, that’s a net return of $3,120. Not huge, but revenues goes up the more Anne presents and there is no impact on operating expenses – it all goes to her bottom line.

Then she wrote and self-published a book. It wasn’t intended to be a bestseller – it was more for her clients. Her clients use the book as a gift for their clients or staff and often pre-purchase them with her events. Anne sells a modest 2,000 books a year and nets $30,000. She also sells the book on Amazon Kindle, but let’s assume all book sales are directly from clients.

Twice a year, Anne advertises a four-week on-line course that sells for $497. To keep it simple, let’s assume that she uses her webinar hosting service (like Zoom or Webex) to deliver the course. With just 14 registrants per course (28 for the year) she nets another $13,916. This is a nice alternative program for clients and proceeds go straight to her bottom line.

Now, here’s the neat part. Anne’s monthly operating expenses are the same as Lynn’s. The only difference is that she has $47,036 more income that flows directly to her bottom line. Even allowing for more income taxes, she is netting $35,277 (60%) more income! Get the full spreadsheet here.

“The only difference is that she has $47,036 more income that flows directly to her bottom line.”


These two scenarios demonstrate a basic accounting principle: fixed and variable costs. Fixed costs are: lights, heat, insurance, and mortgage interest. They don’t go up and down with income – they are a reality you have to pay for. Variable costs change with income.

In these scenarios, both Lynn and Anne have $21,140 in fixed costs (some accountants would argue that virtual assistant and phone are variable, but I’m keeping it simple). Those don’t go away. And they don’t go up if you make more money.

Anne’s workbook, book, and on-line courses ($47,036 in net revenue) don’t change her fixed costs – net proceeds go directly to her bottom line and the more she sells, the more she makes.

What about you? Do you have sales of products that spin off your core business? With a little effort you can have an audio recording, recorded webinar lesson, workbook, ebook, or monthly membership that provides better service for your clients and brings in more revenues every year.


You’re going to work hard. That’s the “fixed cost” of being an entrepreneur. You have to deal with the uncertainty, marketing, outsourcing, delivery, and customer service that goes with enjoying the freedom of having your own business. You should also enjoy the benefits.

“You’re going to work hard. That’s the “fixed cost” of being an entrepreneur.”

More money in my bottom line means I can take writing retreats, holidays with my family, go to conferences, and continually improve how I serve my clients. I also need to invest for my future. I’m working hard – I deserve to also become richer. And so do you.

I also want to share that I knew all of this, but didn’t do anything about it for the first 18 years of my career. Don’t wait, like I did.


Anne’s example gives you some ideas to add to your offering. But the place to start is with your client’s problems. Start by asking: “What problem do I know I can solve?”

  • If they have trouble applying what you teach them, create a workbook.
  • If it’s too expensive to come to your training, create an on-line course.
  • If they need help understanding a concept you teach, create a series of videos.
  • If they want more details, create an ebook.

Choose one product you can complete within one month and get started. You’ll be glad you did. So will your accountant.

Money photo from Tracy O