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brooklynite

(93,875 posts)
Thu Jun 2, 2022, 11:50 AM Jun 2022

More Than a Third of 250k Earners Live Paycheck-to-Paycheck

Motley Fool

Those who make $250,000 or more make up just 5% of Americans, according to the Census Bureau.

But, according to a new survey by Pymnts.com and LendingClub, 36% of them -- while earning four times the median US salary -- are living paycheck-to-paycheck. Someone should tell them there's nothing wrong with having a Dollar Tree vase in a $1.7 million home.

Living paycheck-to-paycheck, of course, doesn't necessarily mean wealthy earners are struggling or deserve a pity party. Only one in ten said they struggled to pay their household expenses in April, and of course there's always another fat paycheck on the way.

The surprising statistic may well be blamed on a disproportionate number of free-spenders in a generation often stereotyped for free-spending: Millennials. Turns out, even the highest-earning members of the age group struggle to stuff their savings accounts, with roughly 55% of millennials earning over $250,000 saying they have little money left at the end of the month. Unsurprisingly, for all generations, the biggest culprit of high spending is likely housing expenses, which often account for a bigger slice of wealthier budgets and exploded during the pandemic.

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More Than a Third of 250k Earners Live Paycheck-to-Paycheck (Original Post) brooklynite Jun 2022 OP
And I'd bet the vast majority of them live in extremely high cost of living cities. PTWB Jun 2022 #1
Housing and childcare really take a bite out of the paycheck zeusdogmom Jun 2022 #5
As number and wealth of billionaires goes up, it won't be long before being a millionaire is poor ck4829 Jun 2022 #2
When you look at the rumors of Depp blowing through $600,000,000, it is not hard to believe. Chainfire Jun 2022 #3
I was netting 38k a year. Wow nt XanaDUer2 Jun 2022 #4
$250k/yr is a little over $2k/month... Wounded Bear Jun 2022 #6
$2K, you mean $20K. Johnny2X2X Jun 2022 #7
Try 20k a month dsc Jun 2022 #8
You'd think an old engineer would be better at maths... Wounded Bear Jun 2022 #10
Your Calculus Professor Must Be Pissed! ProfessorGAC Jun 2022 #19
Meh. It's arithmetic, not mathematics. Ms. Toad Jun 2022 #23
I'm A Both Kind Of Guy ProfessorGAC Jun 2022 #24
I've got two mathematics degrees - Ms. Toad Jun 2022 #25
That Is Odd, Indeed ProfessorGAC Jun 2022 #26
Well, in that they are consistent. Ms. Toad Jun 2022 #27
I think you forgot a zero in your math. PTWB Jun 2022 #9
It is not 2k a month iemanja Jun 2022 #16
One can easily live a nice comfortable life on that JI7 Jun 2022 #11
I guess I've never really paid attention to the % of overall population MissB Jun 2022 #12
Incremental raises Johnny2X2X Jun 2022 #13
LOL iemanja Jun 2022 #17
Well Johnny2X2X Jun 2022 #18
Actually MissB Jun 2022 #22
Then they are not utilizing their resources properly. Coventina Jun 2022 #14
Then they spend way too much iemanja Jun 2022 #15
That's not surprising at all. MineralMan Jun 2022 #20
I assume I'm going to be fired any day now, rownesheck Jun 2022 #21

ck4829

(34,977 posts)
2. As number and wealth of billionaires goes up, it won't be long before being a millionaire is poor
Thu Jun 2, 2022, 11:54 AM
Jun 2022

Billionaires cause inflation.

Chainfire

(17,308 posts)
3. When you look at the rumors of Depp blowing through $600,000,000, it is not hard to believe.
Thu Jun 2, 2022, 11:55 AM
Jun 2022

We have a tendency to live above our means regardless of our means.

Wounded Bear

(58,440 posts)
6. $250k/yr is a little over $2k/month...
Thu Jun 2, 2022, 12:56 PM
Jun 2022

House payment, car payment, insurance of various types.

How much is left for utilities, gas, and groceries?

ProfessorGAC

(64,425 posts)
24. I'm A Both Kind Of Guy
Thu Jun 2, 2022, 05:55 PM
Jun 2022

I do compound interest calculations in my head just to pass time in the car. Or cubing 3 digit numbers
Some neuroscientists say it's a good way to stay sharp as one ages.
I'll go with thati still remember those flash card drills from 6th grade and know to the 4th decimal place fractions up to thirtyiths. Not sure why that's still so clear in my head.
My partial least squares desirability analyses of reaction models are a thing of a past life at this point.
Useful on my job, buy doesn't come up much in conversation. LOL!

Ms. Toad

(33,915 posts)
25. I've got two mathematics degrees -
Thu Jun 2, 2022, 09:53 PM
Jun 2022

I haven't done it recently - but I used to prove theorems as I was dropping off to sleep. Calculations, not so much.

But since I get to take free classes at the university I just retired from I'll be back at it again. Unfortunately, they destroyed the PhD program I wanted to complete (along with both physics and mathematics degrees . . . who ever heard of a university which didn't offer math or physics degrees). That puts a wrinkle in my plans, since the degrees they still offer are engineering PhDs which both interest me less - and have prerequisites I don't have.

ProfessorGAC

(64,425 posts)
26. That Is Odd, Indeed
Fri Jun 3, 2022, 01:53 PM
Jun 2022

There's a uni near here that offers no physics or chemistry degrees at all.
But, anything they offer for a BA/BS, they offer in their grad school.
I'm not sure if that school has a PhD program. Maybe in education, because it was a teachers college exclusively for a very long time.
It's where my wife went to school.

Ms. Toad

(33,915 posts)
27. Well, in that they are consistent.
Fri Jun 3, 2022, 01:56 PM
Jun 2022

The PhD in applied math/computer science was wiped out the same time they wiped out the BA in math. They haven't (at least in recent memory) had a PhD in physics

They just seem such core subjects that all universities (especially state ones) ought to offer them.

 

PTWB

(4,131 posts)
9. I think you forgot a zero in your math.
Thu Jun 2, 2022, 12:59 PM
Jun 2022

2k a month would equal 24k a year — a far cry from 250k.

250k a year is over 20k per month.

That said, jobs that pay these wages tend to be in cities with astronomical cost of living. A one bedroom apartment could easily run thousands of dollars a month in rent alone.

iemanja

(53,003 posts)
16. It is not 2k a month
Thu Jun 2, 2022, 02:32 PM
Jun 2022

Your math needs work. I make a third of that and bring in over $3k a month after taxes.
$250k is the upper 4%.

I'm astonished at the people here justifying enormous incomes as somehow poverty stricken. 96% of Americans earn less than $250k. I'm not crying for the rich.

JI7

(89,182 posts)
11. One can easily live a nice comfortable life on that
Thu Jun 2, 2022, 01:03 PM
Jun 2022

while also being able to save.

But they probably live like they make millions instead of 250k .

MissB

(15,800 posts)
12. I guess I've never really paid attention to the % of overall population
Thu Jun 2, 2022, 01:42 PM
Jun 2022

Dh and I are both engineers, so our household income is within that 5% band. I don't consider us wealthy. We still earn our paychecks. We aren't middle class earners either, admittedly. I'd self-tag as upper middle class in terms of income. We are planners/savers, though, not spenders so I feel less wealthy I guess. Dh and I are predictable enough that I've assigned the same amount of spending money in our budget on a monthly basis for, oh, 10+ years. Regardless of inflation even now.

I live amongst wealthy folks. Some are family money type folks (Forbes list types), some are start up type folks. A few are like us - we bought the cheapest house in the nicest neighborhood, and don't do the golf club/country club/jet set vacations. We are normal-ish folks that spend our weekends doing our own yard work, puttering around our property. We paint our own house, inside and out. We don't employ a housekeeper or a yard service. Dh trims the bushes and I maintain the perennial beds and veggie gardens. I start my veggies from seed each winter. When the kids were growing up, our vacations involved camping at state park campgrounds. So I guess from that viewpoint, I don't consider myself and my husband as wealthy.

I do kinda get it though, if Millennial folks are having issues with cash flow. We bought our current home for a song not quite 2 decades ago. Now someone would be looking at a $6k/month house payment for 30 years to buy it at market rate with the appropriate 20% downpayment. That'd take a huge chunk of that monthly income in just the house payment alone. Our 15-year, $2k/month house payment looks downright quaint in comparison to today's house prices and resulting mortgages. We keep shaking our heads, wondering how folks afford those.



Johnny2X2X

(18,745 posts)
13. Incremental raises
Thu Jun 2, 2022, 02:07 PM
Jun 2022

I know this sounds crazy to most people, but people don't go from making $60K to $250K in one raise, they get raises incrementally over time. And taxes go up with the raises as do retirement withholding and in a lot of places health care costs. My health insurance premium is based off of income. The more I earn, t he more I pay for health care coverage.

If you would have told me 15 years ago what I'd be making today, I'd have thought that I was going to be rich, but I am far from it. Our household isn't making $250K, but we're doing quite well in a lower cost area. We aren't living paycheck to paycheck, but we're not far from that either. Have maybe 2 or 3 months of expenses in savings, needs to be more.

iemanja

(53,003 posts)
17. LOL
Thu Jun 2, 2022, 02:36 PM
Jun 2022

Most $60k jobs will never result in a $250k income. Raises just aren't that high. And if you work in the non-profit sector, they don't even keep up with the cost of living. Your case must be exceptional. People often have to change jobs to get any meaningful raise, which I expect is why the average job tenure today is about 2.5 yrs.

Johnny2X2X

(18,745 posts)
18. Well
Thu Jun 2, 2022, 03:03 PM
Jun 2022

This is household income, so two incomes of $125K gets you there. My current job started at $49K 11 years ago, now is 2-1/2 times that after a few promotions. You get your raises a few grand at a time, or $10K at a time with promotions.

The point is, that you can be pay check to paycheck with a pretty high income. $250K isn't rich, those people work just as hard as the rest of us. $250K isn't even half of what it takes to get to top 1%. Top 1% of $600K a year now. Now I feel more for a family of 4 trying to make it on $55K a year than one living paycheck to paycheck on $250K a year, but the $250K a year are not the problem, the $ Million a year are. And the $1 Million + a year have rigged it so they pay less in taxes.

MissB

(15,800 posts)
22. Actually
Thu Jun 2, 2022, 04:17 PM
Jun 2022

it does happen, as some salaries do increase like that over time. I've watched engineering salaries go up dramatically, both private and public sector.

When we bought the house we're in almost twenty years ago, dh was making $60k and we thought that was fabulous. His current salary (private sector engineer) is over that 250 figure. I'm seeing his company hire B.S. engineering grads (ink barely drying on their diplomas) at nearly $100k. I started at $40k. Granted, their housing costs are more than ours were, but my point is that some classifications of jobs did see dramatic hikes in the past few decades.

My own kids have seen their classmates graduate into $100k jobs (both mechanical engineering graduates).

By the time dh and I kick off this mortal coil, I suspect we'll be even more "get off my lawn" about engineering salaries. Why, back in my day.....

MineralMan

(146,192 posts)
20. That's not surprising at all.
Thu Jun 2, 2022, 03:44 PM
Jun 2022

People in general tend to live slightly above their means, or even more. They assume their income will continue, so they finance themselves into a paycheck to paycheck lifestyle. The more fools they...

rownesheck

(2,343 posts)
21. I assume I'm going to be fired any day now,
Thu Jun 2, 2022, 04:00 PM
Jun 2022

so I don't spend like crazy. We try to just have one car note at a time. I have very little credit card debt personally (less than $800). My wife does have quite a bit, but she's paying it down. My 401k withholding is currently 15% and once a month I'll put $500 on savings.

I'm just never comfortable in a job to just think the money will keep coming in. I treat every day like I'm not gonna have a job tomorrow.

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