You’ve probably seen the headlines. One day Elon Musk is worth $250 billion, the next it’s $700 billion, and then—poof—a court ruling in Delaware or a dip in tech stocks "wipes out" a few dozen billion. It sounds like Monopoly money because, in a way, it kind of is.
If you’re looking for a guy with a steady bi-weekly paycheck and a 401k match, you’re looking at the wrong billionaire. Honestly, the answer to how does elon musk make money is actually simpler and much weirder than most people think. He doesn't really have a "salary" in the way we do. He has stakes. Huge, world-altering stakes in companies that most of the planet depends on.
As of early 2026, Musk's wealth has hit heights that actually break most tracking software. We are talking about the first person to realistically eye the trillionaire mark. But he isn't sitting on a mountain of gold coins like Scrooge McDuck. He’s "cash poor" by billionaire standards, often borrowing against his own shares to pay for his life.
The Tesla Engine: No Salary, Just Sky-High Stakes
Let’s get one thing straight: Elon Musk doesn't take a salary from Tesla. Not a dollar. Since 2017, he has basically worked for "free" on the condition that if the company hits certain insane milestones, he gets paid in stock options.
This is where the drama happens. You might remember the 2018 pay package—the one worth about $56 billion—that a Delaware judge tried to toss out. Well, as of early 2026, that legal saga has largely settled with the Delaware Supreme Court restoring those options. But the board didn't stop there. To keep him focused on the transition to robotaxis and AI, they proposed a new "Mars-shot" package in late 2025 that could eventually be worth $1 trillion.
How it works:
- Performance-based tranches: He only gets new shares if Tesla’s market cap hits specific numbers (think $2 trillion, then $5 trillion, then $8 trillion).
- Operational goals: It’s not just about stock price. He has to hit targets like 20 million vehicle deliveries and 10 million active Full Self-Driving (FSD) subscriptions.
- The FSD Pivot: Recently, Tesla moved away from selling FSD for a flat fee, switching to a subscription-only model. Why? Because steady recurring revenue helps hit those EBITDA targets in his pay plan.
Basically, he makes money when the shareholders make money. If Tesla stock goes to the moon, he becomes the richest person in history. If it craters, his "income" for the year is effectively zero.
SpaceX and the Starlink Cash Cow
While Tesla is the most public part of his wealth, SpaceX is increasingly becoming the real heavy hitter. As of January 2026, SpaceX is valued at anywhere from $350 billion to $800 billion in private markets. Some analysts are even whispering about a $1.5 trillion valuation if the rumored 2026 IPO actually happens.
Musk owns about 42% of SpaceX. Unlike Tesla, which is public and volatile, SpaceX’s value is driven by two massive things:
- Government Contracts: NASA and the Department of Defense have signed deals worth over $20 billion. They need him to get to the Moon and Mars.
- Starlink: This is the secret weapon. It’s not just "internet for hikers." With over 9 million active users across 155 countries, Starlink is a revenue machine that generates billions in actual cash flow, which is rare for a Musk company in its growth phase.
If SpaceX goes public this year, it will likely be the largest IPO of all time. At that point, the question of how does elon musk make money will shift from "stock options" to "massive liquid capital."
The X and xAI Merger: Turning a "Mistake" into an Asset
Remember when everyone said buying Twitter for $44 billion was a disaster? Well, Musk did something sort of brilliant—or at least very calculated—in 2025. He merged X (the social media platform) with xAI (his artificial intelligence company).
By combining the data from X with the compute power of xAI, he created a feedback loop. xAI’s "Grok" gets to learn from real-time human conversation, and X gets a reason for investors to care about it again. When they merged, xAI was valued around $80 billion and X around $33 billion. Musk owns roughly half of this combined entity.
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Instead of just owning a struggling social media site, he now owns a piece of one of the world's most valuable AI labs. This isn't "cash in pocket" money, but it adds hundreds of billions to his net worth on paper.
Other Side Hustles (That are Actually Huge)
It’s easy to forget the smaller players in the Musk empire, but they contribute to the overall valuation of his brand and his ability to borrow money:
- The Boring Company: Still digging tunnels in Vegas and elsewhere. It’s a multi-billion dollar entity that helps him move "fast" on infrastructure.
- Neuralink: With successful human trials becoming more common in late 2025, this biotech play is moving from science fiction to a legitimate clinical company.
- The "Cash Poor" Reality: Because most of his wealth is tied up in shares he isn't allowed to sell (due to tax reasons or board agreements), he makes "spending money" by taking out loans against his stock. He uses his Tesla or SpaceX shares as collateral to get cash from banks. It’s a high-stakes way to live, but when you're worth $700 billion, banks are usually happy to lend you a few hundred million for lunch.
Why This Matters to You
Understanding how does elon musk make money isn't just about celebrity gossip. It shows a shift in how wealth is built in the 21st century. It’s no longer about a high salary; it’s about equity, ownership, and extreme risk-taking.
Musk’s model is built on "incentive alignment." If he fails, he gets nothing. If he succeeds at the "impossible," he takes the biggest slice of the pie. For regular investors, this means his personal bank account is the ultimate "skin in the game."
If you want to track this yourself, stop looking at the news and start looking at Tesla’s quarterly EBITDA and SpaceX’s launch cadence. That is where his money actually lives.
Your Next Steps
- Check the "10-Q" Filings: If you really want to see the nitty-gritty of his pay, look at Tesla's SEC filings. They list exactly which "tranches" of his pay package he has unlocked.
- Monitor the SpaceX IPO News: If you're looking for the next big wealth explosion, the SpaceX public offering is the one to watch in 2026.
- Diversify Your Perspective: Remember that Musk's wealth is highly "paper-based." Don't mistake a high net worth for high liquidity; he is more vulnerable to market crashes than a billionaire with a more traditional portfolio.
The Musk era of wealth is defined by one word: Beta. He bets big, and so far, the house hasn't been able to clear him out.