Are Programmers Rich (2024)

If we look at the salary of a programmer we often get to see that programming jobs are very highly paying jobs. So does that mean programmers are rich? From this article you might get an overall idea of if they are rich or not. Or is it just a myth?

Mostly here’s how it works, As a software engineer, you’ll make a living wage where ever you live. With even modest skill, you’ll be in the top few percent; you’ll be able to afford whatever you want — vacations, travel, family. You’ll be less wealthy than a dentist, but you will have a life.

A well-paid software engineer in tech right now will be making anywhere between $60,000-$150,000 depending on where they live in the USA. Around the world, that number changes significantly. So, let’s stick with US numbers for now.

That is high, but your average doctor makes $189,000 a year, and your average lawyer makes $135,000 yearly. So, when you go to a dentist, they probably make 2–3x as much as the average software engineer.

So, income-wise, by default, a software engineer isn’t on the path to being spectacularly wealthy compared to other professions. That’s the first thing to understand.

And second, you must realize that income does not equal wealth. A couple of years ago, I read the book “The Millionaire Next Door” about the average millionaire in America. That was an eye-opening book.

Most doctors and lawyers in America don’t end up becoming millionaires or retiring wealthy because they spend money as fast or faster as they make it. It usually looks something like this,

When someone makes $60,000 a year and spends $55,000 a year, and then as they move up to making $150,000 a year and are spending $140,000 a year, they haven’t made much progress. Sure, their income jumped by $90,000, but their expenses jumped by $85,000, only netting them an extra $5,000 a year.

One story that hit me was about this surgeon making something like $500,000 a year and was 62 years old. He had less than a million in savings and wanted to know when he would be able to retire. I believe he still owed $400,000 on his house and had college loans for kids, private school tuition,,, and all kinds of crazy things he was paying for.

Despite making a ridiculously awesome income, the dude was effectively broke and not a whole lot better off by default than someone making one-tenth the income. Sure, he lived in a more excellent house and had better toys. But the guy wasn’t wealthy by any means,, and if you look at his probably 30-year career as a surgeon, he didn’t have much to show for it wealth-wise.

The people who are millionaires in the US (who have real wealth) don’t usually live in the fanciest houses. They have nice homes and vehicles but live far below their means. Imagine a doctor making $200,000 a year living like they make $50,000 so they can save and invest $100,000 (after taxes).

That is what wealth-building looks like for most people.

Software engineers who make $150,000 and live like they make $50,000 are on the path to building wealth for themselves and have the possibility of retiring early.

And software engineers who make $150,000 and live on $145,000 will not become wealthy.

Now, in some cases, those weird rare cases, software engineers will work at a startup that “wins the lottery” and either goes public or sells for billions of dollars. Think early Facebook or Google engineers.

Those people can end up with millions of dollars worth of stock options,, which is fantastic for them. But, it’s not something that has a lot to do with their skill as software engineers on their own. It’s in the right place at the right time with the right skills.

The people who go to work for Apple, Microsoft, Facebook, or Google now are not getting wealthy off of stock options for the most part. They do very well for sure, but it’s usually not millions or tens of millions of dollars worth of stock options for your average junior developer straight out of college or even most senior engineers.

So, software is an excellent career if you want to get paid well, have a comfortable work situation, and be able to do a good job taking care of your family. But most software developers will never be what you would call wealthy.

Most software engineers are really happy with their career as they can’t imagine anything else as a career. I think that’s worth something too.

If you are working a 9–5 programming job at an insurance company or bank and making, say, $100K per year, you are rich by international standards but no more richer than a typical accountant or sales rep and probably less rich than most doctors, dentists, or lawyers.

Suppose you are a top 5% programmer and have a top job at Google or Goldman Sachs, including RSUs and bonuses. In that case, you are probably making several 100K per year and are approaching most definitions of rich, although you probably live in a high cost-of-living area like San Francisco, London, or New York.

If you used your programming ability to found a startup that went on to a modest success (say, a medium-sized acquisition), you probably made several million dollars and are undoubtedly rich.

If you are a Mark Zuckerberg or Bill Gates and use your programming ability to found a very successful company, you are worth billions and very rich.

So are programmers rich? Well, it totally depends on the factors of how they are living their life, where are they living, which strategy they are following etc. But generally programmers may not be extremely rich but certainly not poor.