We, as a personal finance professional, add immense value to our client’s financial lives. At PrudentFP, we enable you to create wealth, setting you on a path to achieve your cherished goals and dreams. Hence, you deserve to earn well to take care of your aspirations and live a good lifestyle.
In this post, I want to encourage you to set an appropriate income level target – not too low, not too high. And go about achieving it and enjoying it.
Factors impacting Peoples income level
- Soft Skills – Relationship, Communication & Leadership
- Knowledge/domain expertise
- Years of relevant Experience
- Financial & Investment Behaviour
- Spending and Life Style Pattern
- Consistency in Income Level
So each of us will have the above factors at various levels, and hence the income levels will widely differ. To increase income, you need to work on these factors.
How much is good enough?
You may get into a trap of wanting more and more as there is no end to numbers. It’s important to determine – How much is good enough for you?
In my interaction with many clients across India over the years, I have observed that most of ou good clients are earning anywhere between 12 lakhs to 60 lakhs p.a, i.e., 1 lakh to 5 lakhs p.m.
In India, if you are earning 10 lakhs+ p.a., your income bracket falls in the top 10% of all the households. That is 90% of people earn less than you. And if it’s 50 lakhs+ p.a., you fall in the top 1%.
How much more income do we need to meet our needs, wants and be happy?
Having such a perspective will drive you to the next level and put you at peace with where you stand. Both are important – drive and peace.
Fulfilment Curve
This Good Enough income is also called a Fulfilment Curve. (Please Google it if you are not aware). One of my favorite concepts on money.
You achieve your fulfilment curve when more spending does not lead to more happiness but does the exact opposite.
Jyoti and I hit our Fulfilment Curve or good enough income level in around the 7th year of PrudentFP operations. Our present income aspiration is to simply grow the income around a little more than the inflation rate i.e. lifestyle inflation.
We take a stable annual salary and ensure profits are ploughed back into the company for future growth.
Segregate Savings(FDs) and Investment Finances
One of the biggest mistakes peoples, including our clients, make is mixing savings(FDs) and investment finances. They are prone to think that keeping their surplus money in Fixed deposits to be treated as investment, which is totally biased approach.
People don’t know what their exact take-home income level is? How can we saving back in investment, if this segregation does not exist or is blurred?
I am referring to the income level in this post, which is your personal take-home income after all personal and life style expenses like household, dependent, travel, Personal care, Life style, and EMIs.
How & When will this income come for people?
People are in a hurry to reach high-income targets. It takes anywhere between 5-7 years or more to establish an excellent stable practice. This holds true not just for our finance profession but also doctors, accountants, lawyers, etc. We got to keep patience.
For Salaried persons in India, I have observed that income comes mainly from fixed monthly Salary, interest income, dividend income and Capital gain.
According to my current understanding, anything in the range of 12L to 60L is a good income level. Please make sure you set an appropriate income level target that is aligned with your North Star and go about achieving it.
Do you agree with this and are you aware of your Fulfilment Curve – that good enough income number?
If yes, hit reply with Yes, I have discovered my fulfilment curve!
Wish you Progress!
We’re ready to help you with any questions you might still have?
Suresh Kumar Narula is founder and Principal Financial Planner at Prudent Financial Planners. He has earned the professional CERITIFIED FINANCIAL PLANNER and got registered with SEBI as Investment Advisor. He writes on personal and financial planning articles and got published in Dainik Bhaskar, Business Bhaskar and The Financial Planner’s Guild, India. He is also a member of Financial Planner’s Guild India ( An association of practicing SEBI registered Investment advisers) to create awareness about Financial Planning in general public, promote professional excellence and ensure high quality practice standards. Suresh received his an M.com from Himachal Pardesh University and an MFC from Punjab University, Chandigarh. He can be reached at info@prudentfp.in