High-earning millennials say they’re barely getting by on $100k salaries

May 18, 2023, 1:00 PM UTC
Kelly started earning six figures a year ago. Since, she's been playing catch-up with retirement contributions and savings.
Courtesy of Kelly

A six-figure salary is a dream for many workers across the U.S., a symbol of the success and prosperity that can come with hard work. “I always thought making $100,000 was significant,” says Claire, 27. “And when I reached it, that felt like a really, really big deal.” But the reality has been, let’s say, a bit different, according to Claire and five other millennials in her cohort, the high-earning but not rich yet (or HENRY) class of Americans that Fortune first identified in 2003. Just because you make six digits doesn’t mean you don’t feel a squeeze.

Breaking the $100,000 mark puts you well above the median U.S. household income, but as the cost of living creeps higher and higher, even high earners are finding it more difficult to reach their financial goals. In fact, a recent survey found 34% of households making at least $100,000 per year are spending as much as they earn. There isn’t as much breathing room as some hoped.

Of course, how much is enough depends on various factors including where you live, if you have children or other dependents, what year you graduated from high school or college, and what type of lifestyle you want to lead. Some of these “HENRY” millennials tell Fortune they are comfortable and content—but that could change in an instant, depending on where their lives lead them.

“I recognize that I’m extremely privileged, but I still feel mounting pressure when it comes to our finances,” says Kelly, 29. “Are we getting by? Yes. But we’re not getting ahead, and we’re missing major milestones along the way.”

Below are rough estimates of what five millennial households across the country earning at least six figures spend on different budget categories each month, from most to least costly. (For balance, we threw in one Gen Xer, too.) Like any budget, the numbers fluctuate month to month; some categories are estimates based on a yearly total. They give an idea of how high-earning millennials are spending and saving—and whether their salaries are enough to live well in today’s economy.

“I truly never expected to have such a good, high-paying job, which I think is part of the reason I try not to take my paycheck for granted,” says Claire.

Last names and other identifying details have been omitted so that the subjects could speak freely about their finances and careers.

‘It’s not a lot of money on hand.’

Courtesy of Kelly

Names: Kelly and Andrew
Ages: 29 and 32
Total Annual Income: $166,000
Location: Upstate New York

Estimated Monthly Budget:

  • Liquid Savings: $2,500
  • Transportation: $1,370
  • Retirement: $1,360 (Kelly and Andrew’s 401(k)s)
  • Mortgage: $1,100 (Includes property taxes)
  • Discretionary: $1,000 (Includes clothing, entertainment, travel, etc.)
  • Food: $780
  • Student Loans: $400 (Double this when federal payments resume)
  • Utilities: $225
  • Pets: $200
  • Brokerage: $150
  • FSA: $85
  • Subscriptions: $85

Though the married couple is seemingly saving a lot of money, Kelly, who earns around $125,000 a year—with the possibility of a 10% annual bonus— says they are making up for lost time. She started working at her current job at a tech company one year ago; before, the most she earned was around $62,000 per year, making it difficult to pay for things beyond the basics.

“It’s not a lot of money on hand. A lot of it is going into savings,” she tells Fortune. “I should have been saving for 10 years and I wasn’t.”

Because of that, Kelly doesn’t feel like her salary is nearly enough for her and her husband, despite living in a relatively affordable city. She’s particularly worried about their student loan debt, which totals around $64,000. If President Joe Biden’s cancelation plan is upheld by the Supreme Court, $30,000 of that would be erased, which would give them breathing room. But she’s not counting on it.

“Compared to past generations, $125,000 doesn’t feel like enough anymore,” says Kelly. “My parents, they raised four children on that. I had this expectation that when you make all this money, you can live a comfortable life.”

It’s not just saving for retirement or a new home that is causing Kelly financial anxiety. She says having children seems “impossible” given the cost of childcare, a common concern among millennials and Gen Z.

“When I think of starting a family, I have hesitation to even wanting to do that with student loans still on the table,” she says. “Starting to save for your kids’ student loans while still paying your own off, that’s something I don’t want to do.”

‘We’ve worked so hard to get free.’

Courtesy of Robert and Gail

Names: Robert and Gail
Ages: 38 and 36
Total Annual Income: $170,000
Location: Kansas City

Estimated Monthly Budget:

  • Student Loans: $4,800 (Temporary while interest is not accruing)
  • Retirement: $2,272 (Includes 401(k), pension, Roth IRA)
  • Discretionary: $1,525 (Includes home improvement, pet expenses, and shopping)
  • Food: ~$1,300
  • Mortgage: ~$800
  • Utilities: $500
  • Transportation: $175 (Includes gas and insurance)
  • Memberships: $80 (Includes Amazon Prime and family gym)

After graduating into the Great Recession, Robert and Gail finally feel like they’re on the right track. They are close to paying off their entire mortgage, and own the car they share outright as well. They try to keep their expenses as low as possible, and have made great strides in their retirement savings and debt payoff.

“We graduated right after the financial crisis, and I think we’re in a good position now, but it took us a long time to get here,” says Gail.

Gail is an assistant professor and Robert works in software development. Together, they bring home around $170,000, with Robert currently earning more than half of that after he switched jobs from the public to private sector a few months ago.

His pay jumped from around $86,000 to $110,000, plus over-time; while it’s been a noticeable change, most of it is going toward the family’s savings and retirement goals, rather than current lifestyle spending.

It’s also allowed Gail to put her entire paycheck toward one of the biggest drains on their finances: student loans. The couple has around $38,000 left in federal loans, which they are trying to pay down completely before interest starts accruing again in the fall.

They have been able to put so much toward their student loans over the past few months, in part, by keeping their one-year-old out of daycare. Gail took on fewer classes this semester, and thus a pay cut, to be able to work from home (and avoid the 45-minute commute). The extra time with the baby has been life-changing, but she says they will need to start sending their daughter to daycare in the fall—incurring the additional cost right when federal student loan payments are set to resume.

“There’s a reason we haven’t changed our lifestyle,” says Gail. “There’s this pending financial storm.” 

While all the couple’s bills are paid, they say there isn’t much for extras. They’ve considered saving to buy a new house, but in the current market—and with their current home almost completely paid off—they’re rethinking that. Not having a housing payment would free up more money for other goals.

“We’re so close to being debt-free, we could be out from under our student loans and our mortgage in the next two years if we don’t move,” says Robert. “The American Dream is what, debt peonage? We’ve worked so hard to get free.”

And then there’s the baby’s college education to plan for. Gail says that for now, the couple is focusing on repaying their own debt and saving for retirement. On their current income, that’s about all they can afford.

“I almost feel like you have to earn $200,000 to live comfortably in a place with good schools,” says Gail.

‘Will I ever get to a point where I’m satiated, I’m good?’

Courtesy of Ryan

Name: Ryan
Age: 36
Total Annual Income: $108,000
Location: Phoenix

Estimated Monthly Budget:

  • Retirement: $2,400 (401(k) and Roth IRA)
  • Mortgage: $1,040
  • Brokerage: $1,000
  • Food: $1,000 (Aims for $250 per week)
  • Travel: $500
  • HSA: $217
  • Utilities: $205
  • Transportation: $75 (Occasional Uber)
  • Pet Insurance: $33

Ryan, an insurance claims adjustor, began earning six figures in January 2023. Before that, he worked his way up from earning around $40,000 per year after college to around $80,000. Like many of the other workers interviewed for this story, the biggest difference he’s noticed is that he can save significantly more than he used to.

“I live a pretty comfortable lifestyle. It’s not luxurious or flashy,” he says. “I work hard for my money, I don’t want to give it away easily.”

He lives with his girlfriend, but pays for their entire mortgage himself. He also covers most of the food for the couple. It’s rare that they eat out or go to bars; both are frugal and rarely drink alcohol, and opt for biking or other inexpensive dates instead of frequenting restaurants. Ryan does not own a car, which he says is a benefit of living in an urban area.

After paying off around $35,000 in student loan debt, buying a house was Ryan’s biggest financial goal for many years. He began saving for one around 2017, and was finally able to purchase his condo in January 2021. Though he had hoped to be able to afford a single family home with a yard for his dog, that wasn’t possible in the current market with his salary.

“I’m financially secure, but I don’t consider myself wealthy by any stretch of the imagination,” he says. “I budget really intensely and try to forego things” that aren’t a priority.

Earning six figures a year once seemed like a dream salary; now that he’s achieved it, Ryan feels the pressure to earn more. “The hedonic treadmill, I feel it is only amplified,” he says. He doesn’t necessarily want to buy a new car or fancy clothes. But with friends in fields like tech that earn double or even triple his salary, there’s always a new figure to aspire to. He tries not to give into comparisons, but he says that “will always be a stumbling block in our culture.”

“When I was making $65,000, I thought I’d just need to get to the 70s. And then the 80s and 90s,” he says. “I saw an opening last week where the pay range is $150,000 to $200,000. I’m like, ‘wow all my dreams will come true.’ But will I ever get to a point where I’m satiated, I’m good? I probably won’t.”

‘I feel really lucky to live a life that I enjoy.’

Name: Claire
Age: 27
Total Annual Income: $116,000
Location: Chicago

Estimated Monthly Budget:

  • Rent: $1,237.50 (Half of rent, split with a roommate)
  • 401(k): $1,658
  • Transportation: $717 (Includes car payment, insurance, gas, and public transportation)
  • Discretionary: ~$700 (Includes clothing, entertainment, personal care, travel)
  • Food: $615 (Includes meals for her boyfriend)
  • Liquid Savings: $390
  • Parking Spot: $200
  • Utilities: $105
  • Gym: $75
  • Cellphone: $50

When Claire graduated from college in 2018 with a degree in film production, she had no job prospects and little idea of where to look for work. She lived with her parents until a friend recommended her for an instructional design role at the company they worked for; Claire has been there ever since. It’s not exactly what she wanted to do, but she’s happy with the life it affords her. She finds her joy in hobbies like running and playing the piano; she recently started taking pilot lessons.

“When I started working, I spent a lot of energy being miserable. Those were valid feelings, but once I realized you’re probably not going to have it all no matter what you do, I decided to make the most out of my life,” she says. “I feel really lucky to live a life that I enjoy.”

Her salary has increased from around $53,000 to $116,000 since 2018. She also receives bonuses—previously quarterly, now annually—that she has used to pay off around $7,000 in student loan debt (she paid for the rest with scholarships and jobs while in school) and save for a wedding and a house.

Claire says her parents weren’t great with money when she was growing up. Seeing how stressed out they often were about their finances inspired her to learn as much as she could about managing her money when she got her first job (her older brother taught her the basics). She prioritizes maxing out her retirement account and keeping her living expenses lower than she can technically afford. She tries to be as conscious of a consumer as possible, avoiding fast fashion and impulse purchases.

“I’m glad I can put a lot away in my 401(k) each month, because that’s super important. But with the culture we live in, I always feel pressure to buy things or do things,” she says.

Her salary is more than enough for her on her own, but she also knows it won’t always be this way. She hopes to get married soon, and makes significantly more than her boyfriend. If she were to have children, she wouldn’t be able to save nearly as much, which scares her.

“When I really think about it, I make an absurd amount of money,” she says. “I check myself a lot. I do feel stressed out sometimes, but given my situation and that I don’t have a lot of student loans, I feel like I’m in a really good position.”

‘If I made the same amount for the rest of my career, I’d probably be happy.’

Courtesy of Ty

Name: Ty
Age: 38
Total Annual Income: $120,000
Location: Outside Seattle

Estimated Monthly Budget:

  • Liquid Savings: $2,000
  • Transportation: $1,618 (Includes two car payments, insurance, gas, and maintenance)
  • Rent: $1,100 (Half of his girlfriend’s mortgage)
  • Discretionary: $860 (Includes clothing, donations, entertainment, gifts, and personal care)
  • Food: $810
  • Travel: $625
  • 401(k): $600 (Split between traditional and Roth accounts)
  • Brokerage: $500
  • Insurance: $105 (Includes life and long term care policies)
  • Cellphone: $92

When Ty started his accounting career, he was earning around $40,000 per year and worked a side job to be able to afford his bills and other expenses. It wasn’t until he hit the six-figure income mark that he could afford to give up the second job.

Now, he’s more than comfortable earning $120,000 per year.

“When I was younger, money was a priority, a driving factor, but now it doesn’t matter,” he says. “If I made the same amount for the rest of my career, I’d probably be happy. I’m doing absolutely everything I want to do.”

Though real estate is often touted as the best way to build wealth, Ty says buying too quickly actually hurt him, at least in the short term. He owned a home when he was younger; he could barely afford the payments, and eventually sold it at a loss, destroying his credit and finances in the process. Now, it’s not a priority for him to ever own his home again.

“Growing up, everybody is like, ‘this is what you do, go to college, buy a house.’ I’ve owned a house, it sucks,” he says. “If you look internally and one of your true goals is to buy a  house, that’s great. But if you want to have experiences and do things, having a house can hinder that.”

Instead, he prioritizes experiences like traveling and hobbies, including mountain biking. With no kids, he is able to spend and save exactly how he wants to. He encourages others to be as intentional about their goals, and plan ahead as much as possible.

“Once you don’t focus on making other people happy, and you focus on what actually makes you happy, you might be able to go out and do a lot more things that are cheaper, more exciting, give you more stories, and just bring you more joy,” he says.

All of his financial comfort is hard won. Ty was previously married, and he and his ex did not see eye to eye on finances and goals. Now, he and his current girlfriend discuss money often, and are aligned on where their futures are headed. He hopes eventually he will be able to scale back his hours at work.

“I don’t want to pass on a lot of money to anybody, because what’s the point? I want to invest just enough to basically die the same day I spend my last dollar,” he says. “I’ve actually cut back on my retirement savings because it was going to be too much.”

‘I’m finally, really putting big chunks of cash aside.’

Courtesy of Mike

Name: Mike
Age: 50
Total Annual Income: $210,000
Location: Boston

Estimated Monthly Budget:

  • Mortgage: $3,200
  • Retirement: $2,500
  • Food: $2,200
  • Liquid Savings: ~$1,000 (Less in months he travels)
  • Transportation: $690
  • Donations: ~$400
  • Gym Membership: $160
  • Utilities: $150
  • Pets: ~$100
  • Life Insurance: $90
  • Cellphone: $90

While millennials have faced a some set backs in the wealth-building stage of life, things do get easier, at least according to one Gen Xer.

Since he and his first wife divorced a decade ago, Mike has been making an effort to rehabilitate his finances. He’s spent the past 10 years paying off a five-figure credit card balance, saving to buy a new home within the city of Boston, and prioritizing his retirement contributions.

“My net worth took a big hit at the age of 40,” he says. “Now I’m finally, really putting big chunks of cash aside.”

Mike’s salary jumped from around $140,000 to $210,000 just before the COVID-19 pandemic reached the U.S. Staying home right when he started earning significantly more meant he was able to save more than he ever had. Now, with restrictions lifted, he and his wife travel as much as possible.

Mike says he mismanaged his money when he was earning less. But the lessons he learned means he is living comfortably now—so comfortably that he’s considering whether he might be able to cut back on his hours at work (he’s a manager at a consulting firm) in a few years as a sort of early retirement.

“Since the pandemic has ended, we’ve been making up for lost time. I’ve been able to travel a lot without worrying what it will cost,” he says. “But I grew up in a blue collar household, so my relationship with money is pretty pragmatic. I’m still frugal, but I’m not a penny-pincher.”

He lives with his wife, who is a professional musician and earns about a quarter of his salary. The pair do not have children, which he says makes his life possible; they love eating out at the restaurants around their apartment, skiing, and traveling. “I’ve prioritized quality of life over quantity of things I can spend my money on,” he says.

He’s also happy in the city because he doesn’t need to own a car (his wife has one for work) to get by—even if it means paying more for housing and other line items in his budget.

“If I lived anywhere else with the same salary, I would feel like Warren Buffett,” he says. “But because it’s Boston, I’m still doing all different kinds of calculus to make sure I have enough for retirement. I feel extremely fortunate, but I wouldn’t consider myself financially wealthy.”

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