According to PYMNTS Intelligence, 62% of U.S. consumers now live paycheck to paycheck, and that includes 48% of consumers earning more than $100,000 annually.
In other words, higher incomes do not necessarily protect people from the financial stress that comes from living from one paycheck to the next. In fact, according to a recent edition of PYMNTS Intelligence’s “New Reality Check: The Paycheck-to-Paycheck Report: Why One-Third of High Earners Live Paycheck to Paycheck,” 36% of those earning more than $200,000 annually also say they live paycheck to paycheck.
The report, based on surveys with 4,285 U.S. consumers, also found that roughly three-quarters of low-income consumers (those earning less than $50,000 per year), and approximately two-thirds of middle-income consumers (those earning between $50,000 and $100,000 per year) report living paycheck to paycheck.
For those making more than $200,000 each year, our data shows that recreation, personal care and everyday transactions account for about 28% of their budgets. We also found that high-income consumers are more likely to say that education costs and expenditures for nonessential assets significantly affect their financial situation. Put another way, high-income consumers spend more on discretionary items, which makes saving money more difficult.
Which expenses absorb the lion’s share of high-earning, paycheck-to-paycheck budgets?
Twenty-one percent of high earners say they simply don’t earn enough to keep pace with their expenses, which include covering costs associated with family members (23%), carrying large amounts of debt (15%), and spending on nonessential items (12%).
Compare these findings to those earning less than $50K annually, 40% of whom say they earn insufficient incomes. Only 8% of them help cover family member expenses. Nineteen percent carry heavy debt, which might account for the fact that only 7% say nonessential spending contributes to their financial woes.
The most obvious difference in how high-income earners allocate their funds versus lower-income consumers is the amount allocated toward nonessential spending. Those earning $100,000 per year are around twice as likely to reportnonessential spending as a major factor in why they live paycheck to paycheck than low-income earners.
PYMNTS Intelligence research also found that high-income consumers are among the first to increase their discretionary spending when inflationary pressures begin to subside. With the cost of housing and groceries rising right now, it might be a good time for those paycheck-to-paycheck consumers who earn north of $100,000 to curb nonessential purchases from their budgets.
See More In: consumer finance, Consumer Spending, data brief, debt, economy, Featured News, household income, inflation, News, nonessential spending, PYMNTS Intelligence, PYMNTS News, The Data Point
FAQs
According to PYMNTS Intelligence, 62% of U.S. consumers now live paycheck to paycheck, and that includes 48% of consumers earning more than $100,000 annually. In other words, higher incomes do not necessarily protect people from the financial stress that comes from living from one paycheck to the next.
What percent of consumers live paycheck to paycheck? ›
A 2023 survey conducted by Payroll.org highlighted that 78% of Americans live paycheck to paycheck, a 6% increase from the previous year. In other words, more than three-quarters of Americans struggle to save or invest after paying for their monthly expenses.
What percent of people who make $200,000 live paycheck to paycheck? ›
The report drew on insights that 4,285 U.S. consumers shared with us, as well as supplementary economic data. It found that 62% of all consumers now live paycheck to paycheck, including 36% of those whose annual incomes exceed $200,000.
What percent of Americans earning more than $250000 do you think are living paycheck to paycheck? ›
In April 2022, 36% of consumers earning $250,000 or more annually lived paycheck to paycheck, as did those earning between $200,000 and $250,000 per year. One of teacher faves in the budgeting category: Budgeting with Roommates.
What percentage of Americans live paycheck to paycheck Dave Ramsey? ›
78% of Americans are living paycheck to paycheck. Basically, that means almost 8 out of 10 people probably can't afford the home they're living in and the car they're driving. They might not even have the cash to cover the next emergency that pops up. Your income is your most important wealth-building tool.
What percent of people who make $100,000 live paycheck to paycheck? ›
According to PYMNTS Intelligence, 62% of U.S. consumers now live paycheck to paycheck, and that includes 48% of consumers earning more than $100,000 annually.
Do 80% of Americans live paycheck to paycheck? ›
A majority, 65%, say they live paycheck to paycheck, according to CNBC and SurveyMonkey's recent Your Money International Financial Security Survey, which polled 498 U.S. adults. That's a slight increase from last year's results, which found that 58% of Americans considered themselves to be living paycheck to paycheck.
What paycheck is considered rich? ›
Data from the U.S. Census Bureau was used in the report. For Californians hoping to join the prestigious club, residents would have to bring in an average income of $613,602, a nearly 40% increase from 2017, when the average income needed for the top 5% of earners was $447,207.
How rare is 200k salary? ›
A $200,000 household income is more than most people earn across the U.S. In fact, just 12% of U.S. households earn $200,000 or more annually, according to Census Bureau data.
How many Americans have $2000 in savings? ›
About 29% of respondents have between $501 and $5,000 in their savings accounts, while the remaining 21% of Americans have $5,001 or more. Few hold much cash in their checking accounts as well. Of those surveyed, 60% report having $500 or less in their checking accounts, while only about 12% have $2,001 or more.
Even so, Americans are still finding themselves feeling crunched after a period where wealth-building proved difficult. A separate study from PYMNTS of more than 4,200 consumers found that 62% of total consumers and 36% of those making more than $200,000 feel like they're living paycheck to paycheck.
Is 250k a year wealthy? ›
It's important to remember that the definition of what it means to be rich is subjective. Someone who makes $250,000 a year, for example, could be considered rich if they're saving and investing in order to accumulate wealth and live in an area with a low cost of living.
What percentage of Americans earn $100000 or more? ›
Only 18% of individual Americans make more than $100,000 a year, according to 2023 data from careers website Zippia. About 34% of U.S. households earn more than $100,000 a year, according to Zippia.
What is the 50/30/20 rule? ›
The 50-30-20 rule recommends putting 50% of your money toward needs, 30% toward wants, and 20% toward savings.
Is a millionaire's best friend? ›
A Millionaire's Best Friend: Compound Growth
Here's a little secret: Compound growth, also called compound interest, is a millionaire's best friend. It's the money your money makes.
What is the 75 15 10 rule? ›
The 75/15/10 rule suggests devoting 75% of your income to living expenses, 15% to investing, and 10% to savings. This guideline can be a flexible way to prioritize your long-term financial future when deciding how to budget and allocate your income, which you can adapt based on your situation.
Do 60% of Americans live paycheck to paycheck? ›
Sixty Percent of US Consumers Live Paycheck to Paycheck – That Could Change in 2024. Persistent inflation and increasing prices for essential items, from groceries and utilities to fuel, have left most Americans treading water financially in recent years.
What percentage of Americans make over 100k? ›
Over one-third of American families earn $100,000 or more
The U.S. Census Bureau found that 37.1% of U.S. households earned at least $100,000 in 2022. Here's a more detailed breakdown of six-figure income brackets and the percentage of households in each one: $100,000 to $149,999: 16.9%
How many Americans have less than $1000 in savings? ›
Key Takeaways. More than one in four Americans (28%) have savings below $1,000. This is the case for 32% of Gen Zers, followed by Millennials at 31%, Gen X at 27% and Baby Boomers at 20%.
What percentage of Millennials live paycheck to paycheck? ›
Nearly three-quarters (73.2%) of millennials report living paycheck to paycheck. That's the highest of any generational cohort. Even more millennials than Gen Xers struggle with budgeting and financial planning (57.08%). They further report challenges with high monthly bills (50.27%) and low income (41.96%).
