Elon Musk, the billionaire founder of Tesla, SpaceX, and several other groundbreaking companies, has long defied traditional notions of wealth and compensation. Known as the wealthiest person in the world, Musk famously does not draw a salary from the companies he leads—or if he does, it’s merely symbolic, often reported as $1 per year.

This raises an intriguing question: How does someone who works without pay amass a fortune exceeding $240 billion?

The answer lies in a high-stakes game of equity, investments, and timing.

The $1 Salary Club

Elon Musk isn’t alone in rejecting a traditional salary. Tech icons like Mark Zuckerberg and the late Steve Jobs also accepted minimal salaries during their tenure as CEOs. For these executives, their wealth isn’t about monthly paychecks—it’s about ownership.

Musk’s fortune doesn’t come from a paycheck. It comes from equity: vast holdings in Tesla, SpaceX, and other ventures. These assets are tied to the performance of publicly traded and privately held companies, meaning Musk’s net worth can soar or plummet based on market trends. He was the first person in history to see their net worth top $300 billion—and the first to lose $200 billion as share prices fluctuated.

As of this writing, Musk sits atop Forbes’ billionaire list, with an estimated fortune of $248.8 billion. He leads French luxury magnate Bernard Arnault, whose net worth is estimated at $207.1 billion.

A History of Betting on Himself

Musk’s journey to billionaire status didn’t start with Tesla or SpaceX, but with a series of daring ventures that paid off in dramatic fashion.

Born in 1971 in South Africa, Musk moved to Canada in his late teens and briefly attended Stanford University in California before dropping out to pursue entrepreneurial dreams in Silicon Valley.

In the mid-1990s, Musk co-founded Zip2, a city guide software company that was later sold to Compaq for $305 million. Musk walked away with $22 million at just 28 years old.

Soon after, he launched X.com, an online banking and payment company that eventually merged with Confinity to become PayPal. In 2002, eBay acquired PayPal for $1.5 billion. Musk’s share netted him $165 million.

That early windfall laid the foundation for Musk’s later investments. One of the first things he did? Buy back the domain name X.com—a personal passion project that would, two decades later, become the branding for the social media platform formerly known as Twitter.

Tesla and SpaceX: From Financial Risk to Billionaire Reward

In 2002, Musk used his PayPal money to found SpaceX, with the audacious goal of colonizing Mars. A few years later, in 2004, he invested $6.5 million in Tesla Motors, becoming the company’s largest shareholder and, eventually, CEO.

Both companies were unprofitable and teetered on the edge of collapse in their early days. By 2008, Musk had poured $40 million of his personal funds into Tesla to prevent bankruptcy. Around that same time, SpaceX faced a string of failed rocket launches. Musk, by his own account, was borrowing money just to cover basic expenses.

But the tide turned in 2010 when Tesla went public. Its stock steadily rose in the early years, but it was the pandemic era that saw an explosion in its value. In 2020 alone, Tesla shares surged by 700%. Musk’s fortune ballooned from $30 billion at the start of the year to $170 billion by its end.

In January 2021, Musk officially became the world’s richest man, with a net worth exceeding $200 billion. That wealth peaked in November 2021 at around $340 billion—a figure never before reached in modern history.

The Stock Market: His Greatest Ally—and Risk

Musk’s wealth is volatile because it’s not held in cash or real estate. It’s equity. Nearly half of his net worth comes from Tesla stock. About 20% comes from SpaceX, and the rest is spread across Twitter (now X), The Boring Company, and Neuralink.

Because Musk receives stock options instead of cash compensation, his wealth grows only when the stock performs well. Tesla’s board has approved multi-billion-dollar compensation packages that reward him with stock if the company meets aggressive growth targets—some of which have already been achieved.

According to Bloomberg, these stock-based compensation plans are structured to avoid immediate taxation, which has led to criticism that billionaires like Musk exploit tax loopholes. Musk, however, insists that he pays large tax bills when he sells shares—most notably in 2021, when he sold over $16 billion worth of Tesla stock and paid over $11 billion in taxes, a U.S. record.

A Crypto Wild Card

Outside of tech and space, Musk is also known for his influence in the volatile world of cryptocurrency. In 2021, he publicly disclosed that he owns Bitcoin, Ethereum, and Dogecoin—and that Tesla itself had invested $1.5 billion into Bitcoin.

With a single tweet or meme, Musk has been known to send cryptocurrency prices soaring or plummeting. His tweets about Dogecoin, in particular, have led to rapid surges in its value, raising questions about market manipulation—even as Musk frames it as tongue-in-cheek internet humor.

Whether or not he profits directly from these spikes, there’s little doubt that his influence in the space is enormous.

The Future of Musk’s Fortune

Despite a staggering $200 billion loss in net worth when Tesla’s stock corrected after its meteoric rise, Musk remains the richest person in the world. His success is a testament to the power of equity, long-term vision, and the willingness to reinvest in oneself.

And while Musk may not collect a salary, he has clearly figured out something far more valuable: how to build and hold ownership in companies that are reshaping the future of transportation, space travel, social media, and beyond.

It’s not a model everyone can—or should—follow. But for Elon Musk, it has made all the difference.