Elon Musk is a household name. It’s hard to avoid the magnate of tech, space exploration and alternative energy, who has become almost unavoidable in terms of public attention. As one of the wealthiest people in the world, Forbes estimates that Musk’s net worth is currently over $185 billion. While most of us may have been dreaming of having Musk’s wealth, how much money does he make in one day?
Musk’s wealth comes from a myriad of sources, including his various entrepreneurial projects, investments, settlements, and more. The majority of his wealth, however, revolves around Tesla. Musk ranks as the seventh highest-paid CEO in the S&P 500, and is set to secure $3.7 billion in share-based compensation over upcoming years. As of mid-month February 2021, Tesla’s stock price was up almost 830 percent since the start of 2020 -where Elon owns a 21 percent stake. If Musk sold off his Tesla stake in one payment, he’d make a daily profit of about $153 million. Of course, such a number is not the everyday; the ongoing stock performance often fluctuate his estimated regular earnings.
Musk’s other endeavors include Space X, The Boring Company, Neuralink and multiple startups and other projects. For such ventures, the super-entrepreneur serves as Chairman and CEO, with generous stock-option packages that often match the magnitude of the investments ( approximately $250 million, in the case of Space X). A few months ago, Musk sold stock for a total of about $2.4 billion. Despite the recent giant sum, most of his income comes from his employment with Tesla, his position as CEO brings him a salary of around $45,000 – that’s an annual income of $2 million, as he works for only 2 days a month. Musk’s salary is a mere drop in the pond, when compared to the brand’s total wealth.
Furthermore, the details of Elon Musk’s equity and stock options can be found in the ‘’Tesla 2020 Proxy Statement’’. It is noted that Musk holds stock options worth around $50 billion, and so do Musk’s many business interests, to his real estate investments, and more. All in all, his various assets likely add up to a much larger number than his Forbes-listed net worth. However, the business magnate’s estimated daily earnings is still unknown since the stock performance, bonuses and dividends he receives are constantly changing due to the market.
Emergency Funds and Investments
At the beginning of the pandemic in 2020 alone, Musk reportedly sold $10 billion in Tesla stock to finance and maintain his emergency funds and investments. It goes without saying that Elon has done very well in terms of his emergency funds, stocks and other sources of wealth. Since 2018, his stock and option holdings have roughly quadrupled in value.
Last year, in February 2020, Musk liquidated $1.5 billion Tesla stock for the first time, prompting people to speculate about his plans and Investment strategies. The sale followed the announcement of Tesla’s fourth-quarter earnings, which had exceeded Analyst expectations. As the Tesla share price rallied 32 percent in 2020, Musk continued to enjoy unprecedented success.
Musk was also been keen to explore other options, delving into both cryptocurrency options as well as traditional investment vehicles. Last summer, Elon Musk made headlines when he announced that he had purchased $1.5 billion worth of Bitcoin. This announcement resulted in a surge in Bitcoin’s price, as well as an increase in investor confidence. Over the past couple of years, Musk has also disclosed his portfolio into other markets such as real estate, retail, and energy firms.
Taxes
On top of the estimated daily income, Musk reportedly makes more money from taxes. He must pay taxes in countries where he does business, such as the United States, as well as any country where he has investments, such as Britain. The total amount of taxes he owes for the publication year is usually between a quarter to a third of his income.
In 2019, the tax obligations for a single, high-income earner (such as Musk) run at 37 percent. For an income of $10 million, a tax bill of $3.7 million needs to be paid. As of last year, Musk also reported a 13 million USD tax liability in California. Musk is also taxed at the applicable corporate tax rate, as his companies are structured as C-corporations, aswell as having to pay payroll tax.
Different situations result in varying taxes, and with Elon Musk’s complex network of investments, thanks go to the accountant who keeps track of it all.
Divestment
Despite most of Musk’s wealth being derived from his equity payments based on Tesla stock value, this is not the full picture. A few weeks ago, Musk began liquidating his shares at a remarkable rate. In a matter of days, he had sold 800 million USD in Tesla stocks and multiple other divestments have been made in the past year. It is not known what Musk intends to do with the proceeds of this divestment, as he has made no public announcements as of yet.
These individual sales are part of a larger plan to reduce Musk’s over all holdings in Tesla, as part of his amazing success in the stock market over the past few years. It is a common practice for the high-profile billionaire investor to use short term investments and divestitures to increase his overall value and mitigate risks.
It is estimated that Musk divested more than $2.7 billion of Tesla’s stock in 2021. While Musk is known to be an avid investor in the stock market, his efforts to normalize his financial life by reducing the risk in his portfolio are also paying off. With divestment being a major part of his investment strategy, it is hardly surprising that Musk’s amazing wealth is continuing to grow.
Conclusion
At the end of the day, it is easy to see that Musk’s daily earnings come from multiple sources. From his current salary, stock options and salary packages to dividends and taxes, Musk’s income continues to skyrocket. Having such a diverse portfolio of investments, assets and sources of income, Musk’s estimated daily earnings is not a fixed figure, often fluctuating throughout the year. For example, the recent surge in Tesla’s stock prices only pushes Musk’s estimated daily earnings closer to the ultra-high end. However, the ever-evolving nature of the stock market often creates spikes and dips in the figures, making his actual daily earnings an impossible number to accurately estimate.
