Even six-figure earners are living paycheck to paycheck as costs soar — why high incomes aren’t enough to escape the affordability crisis

Jason Sargent Sunday, November 23, 2025

- - Even six-figure earners are living paycheck to paycheck as costs soar — why high incomes aren’t enough to escape the affordability crisis

Chris ClarkNovember 23, 2025 at 8:30 PM

Mid-adult man leaning at table at home holding head amid papers, glasses, calculator, and laptop.

While many people might assume a six-figure salary would buy peace of mind, for a growing number of Americans, it’s barely buying time until the next paycheck.

That’s according to a new Goldman Sachs report that finds even top earners are struggling to stay ahead of their bills. (1) A quarter of workers earning more than $100,000 a year say they’re living paycheck to paycheck, and surprisingly, that percentage jumps significantly — to 41% — for those making between $300,000 and $500,000, and to 40% for those making more than $500,000.

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“A meaningful share of higher earners also report living paycheck to paycheck or making only limited progress toward long-term financial goals, underscoring that elevated expenses, debt burdens, and lifestyle inflation can erode savings capacity across the income spectrum,” the report’s authors write.

That might sound absurd until you consider how much life now costs. Goldman warns that even high earners are trapped in a “financial vortex,” where housing, child care, and health care swallow a rising share of take-home pay. The firm predicts that by 2033, 55% of U.S. workers will be living paycheck to paycheck.

Here’s what’s behind this surprising statistic, and what people can do to start living within their means.

When keeping up becomes a financial trap

Money, for many high earners, has become less about security and more about signaling. Economists call it “social comparison,” the quiet pressure to keep pace with peers whose lifestyles broadcast success on Instagram or in the school pickup line. (2) That pressure doesn’t fade with income, but tends to scale up.

It’s also easier than ever to lose track of what’s real. Easy credit, buy-now-pay-later platforms, and same-day delivery all flatten the sense of cost, making spending frictionless. Goldman’s data suggests high earners are especially vulnerable to a kind of invisible debt build-up because they can qualify for more credit and carry it longer without noticing.

“The impact on retirement saving may be lower contribution rates, increased likelihood of pauses or loans, and delayed retirement timelines,” the report said. “Importantly, these effects may be broadly felt, regardless of income level.”

When high income meets high overhead

The problem isn’t just inflation. It’s inflation plus expectation: As incomes rise, so do lifestyles. The bigger house comes with a bigger mortgage and higher property taxes. The nicer car means pricier insurance and maintenance. Private schools, travel teams, streaming subscriptions, and $7 lattes all quietly expand the monthly burn rate.

That’s called lifestyle creep: the stealthy financial sabotage that convinces people earning $250,000 they’re still “middle class.” (3) And with the cost of essentials climbing fast – housing now eats up roughly half of median income, according to Goldman – even well-paid households are finding their margins vanish.

Prices for groceries are up significantly, (4) rents continue to surge, (5) and insurance premiums for everything from health care and cars to homes have jumped. (6, 7, 8) Add rising interest rates on credit cards and mortgages, and it’s no wonder so many high earners feel nearly broke on paper.

Read more: 22 US states are already in a recession — protect your savings with these 10 essential money moves ASAP

How high earners can learn to stop living paycheck to paycheck

Goldman’s report shows many high earners dipping into savings or pausing 401(k) deposits to keep up with lifestyle costs. They’re not poor, but they’re stretched – and that’s a dangerous place to live long-term.

The real test isn’t how much you make but how much you can keep without burning out. Living within your means isn’t about deprivation; it’s about control. Start by tracking where your money actually goes each month. You might be shocked at how many “essentials” aren’t essential at all. Once you see the leaks, set firm boundaries and consider automating retirement and emergency savings first before building your lifestyle around what’s left.

Another fix: freeze lifestyle creep. When you get a raise, don’t immediately upgrade your car or move into a pricier zip code. Let your savings grow instead. The goal isn’t to live cheaply. It’s to live freely, without needing every paycheck to keep the machine running.

Whether you earn $60,000 or $600,000, the key to financial stability is the same: spend less than you make and invest the difference. High earners may have more zeros on their paychecks, but the same math applies — and ignoring it can turn even the wealthiest household into one more story of paycheck-to-paycheck living.

PRIMO MAG

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