Income Sources of Elon Musk
2020 has been a good year for Elon Musk. The tech entrepreneur has seen his wealth skyrocket due to several factors, including a big stake in the electric car maker Tesla, surging sales and the announcement of the launch of SpaceX’s Starlink broadband network. Musk’s wealth stands at $73.1 billion, making him the second-richest person in the world.
Though Musk’s primary income source is his stake in Tesla and other companies, he also draws an $56,380 salary from Tesla, according to the company’s 2018 U.S. SEC filing. That is far below the median salary for American chief executive officers. However, the bulk of Musk’s income does not come from his salary but from the stock options he has at Tesla. These stock options give him the potential to make millions in the future.
In 2018, Musk earned a staggering $2.3 billion in stock options and exercised his rights to buy 12.3 million Tesla shares, garnering another $873 million. While his salary is fixed at $56,380, Musk could theoretically earn billions in a single day if Tesla’s stock rises significantly.
Musk has announced his intention to never sell any of Tesla’s stock, which he believes are the key to a sustainable source of income. The fact that Musk’s net worth is rising at a rapid rate underlines the fact that he is a shrewd and knowledgeable investor, not just a genius at engineering innovative products.
Musk additionally made millions of dollars from the sale of other businesses, such as Zip2, X.com, PayPal, SpaceX, and SolarCity. SolarCity was sold to Tesla in 2016 for $2.6 billion, from which Musk reportedly pocketed $500 million.
Musk has made many investment decisions that paid off handsomely. He has invested in a variety of companies and products, including companies that have subsequently gone public. The tech mogul has made millions of dollars from his financial investments.
Musk’s Lifestyle and Expenses
Elon Musk has made a fortune, but he also spends a tremendous amount of money. Musk has said that he spends a lot of money on expensive cars and private planes, but such luxuries are far from his only expenses. In fact, his personal burn rate is likely to be quite high due to his lifestyle.
Musk’s lifestyle involves frequent travel. He is often on the move, attending meetings and speaking events, and clocking up personal air miles. While Musk’s travel schedule has probably been curbed by the coronavirus pandemic this year, it’s likely that he was still spending a considerable amount of money on flights.
Musk spends a lot of money on luxury hotels, private jets, and expensive meals. In 2017, he reportedly spent about $1 million on private jet travel alone. He also buys expensive gifts for friends, family, and for himself. For instance, he is said to have bought an expensive watch for himself and a Ferrari for his brother.
Musk is also said to have property throughout the U.S., from Los Angeles to Texas. He also owns homes in Europe, along with holiday homes in Thailand and the Caribbean, which come at a hefty price tag. Clearly, he can afford to support a huge lifestyle, as evidenced by his high personal burn rate.
Musk’s Charitable Causes
Elon Musk gives away a considerable amount of money to various charitable causes. He has donated millions of dollars to, for example, the Breakthrough Prizes and the Mozilla Foundation, and he has launched the Musk Foundation which works to use sustainable and renewable technologies to advance human progress. Musk’s charitable giving is estimated to be over $100 million.
Musk is also active in environmental causes. He has invested $35 million in Tesla Energy, which is making renewable energy storage systems accessible to all. Musk has also spoken out against companies who are not taking the effects of global warming seriously enough.
In addition to donating money to charitable causes, Musk also offers his expertise to organizations. For instance, he has helped fund research into artificial intelligence. He is also known to have mentored promising entrepreneurs, teaching them his secrets of success.
Musk has said in the past that he believes it’s important to be generous and give back to those less fortunate than him. That said, it’s clear that his donations alone do not come close to covering the cost of his expensive lifestyle.
One way Elon Musk makes money every day is through the buying and selling of Tesla shares. As CEO of Tesla, Musk is allowed to buy and sell small amounts of the company’s stock, with any profits going directly to his wallet.
There are also other strategies Musk uses to make money through the stock market. Musk has become the majority shareholder in several companies, including Tesla, SolarCity, and SpaceX, by buying and exercising stock options strategically. Through these investments, he has managed to acquire a large stake relatively cheaply, increasing the likelihood of making a profit when the stock price goes up.
Musk has also been known to engage in short selling, a strategy where an investor borrows stock to sell and then buys it back when the price is lower, making a quick profit. Musk reportedly made his first million by short selling emerging markets stock when he was still in college.
Final Thoughts
Elon Musk is a self-made billionaire whose net worth has skyrocketed this year due to his investments in Tesla and other companies. Musk has also made millions from the sale of other businesses he has been involved with. His lifestyle is also expensive, with Musk spending vast amounts of money on fancy cars, jets, and luxury hotels.
Musk has also supported many charitable causes and invested in research into renewable energy, artificial intelligence, and other technologies. Additionally, he has made millions through the stock market by buying and exercising stock options and engaging in short selling. All in all, Musk earns a tremendous amount of money every day.
