The prices of goods and services will continue to weigh on U.S. consumers’ wallets in 2024. Most consumers still say they live paycheck to paycheck. Overall, 62% of consumers lived this way as of January 2024, down from 60% last year. This increase suggests the rising cost of living may be taking its toll on consumer finances — including high-income consumers.
More than one-third of those annually earning more than $200,000 saying they live paycheck to paycheck. While rising housing and food costs impact high-income consumers, other factors — such as nonessential spending, paying expenses for others and drawing on savings due to unexpected expenses — may particularly inform their financial lifestyles. Wages for high earners are more likely to have kept up with inflation, possibly explaining their increase in discretionary spending. Just 18% of overall wage earners say their incomes have kept up with inflation, yet 27% of high earners say so.
These are a few of the findings detailed in this edition of “New Reality Check: The Paycheck-to-Paycheck Report,” a PYMNTS Intelligence exclusive report. This edition, “Why One-Third of High Earners Live Paycheck to Paycheck,” examines the financial lifestyles of U.S. consumers and the factors contributing to their financial status. This edition draws on insights from a survey of 4,285 U.S. consumers conducted from Jan. 9 to Jan. 16 and an analysis of other economic data.
Other key findings from the report include the following:
Sizable portions of high earners live paycheck to paycheck.
The increase in consumers living this financial lifestyle is evident across income brackets. The share of consumers living this financial lifestyle and annually earning more than $100,000 has increased from last January, currently standing at 48%. This share includes 36% of those annually earning more than $200,000. Even though they tend to have higher incomes, millennials are more likely to live paycheck to paycheck, as do urban consumers.
High earners’ budgets are as inflexible as low earners.
Even as housing and food costs rise, more affluent consumers report that essential spending represents a smaller fraction of their budgets than lower-income consumers. Discretionary spending on leisure, personal care and everyday transactions represents close to one-third of higher-income consumers’ available income. Higher incomes may also encourage consumers to engage in newer types of fixed expenses. For instance, those at the upper end of the income distribution are 54% more likely to be paying for education.
High-income, paycheck-to-paycheck consumers are inconsistent savers.
As income grows, the likelihood of saving usually increases. However, many high-income earners do not set aside fixed portions of their incomes. In fact, close to 1 in 5 consumers annually earning more than $100,000 have not saved every month in the last quarter. Adding to that, just 1 in 10 say they are non-savers. High-income earners are the likeliest to say they lack good saving habits. One possible explanation is that they may have less incentive to save than the average consumer as they are more confident about their job prospects and are less likely to switch jobs.
As inflationary pressures have subsided from their July 2022 peak, high-income consumers have rapidly increased discretionary spending. However, even they could benefit from finding ways to budget for essential and nonessential items to better live within their means. Download the report to learn about the financial stressors and spending habits causing high-income consumers to live paycheck to paycheck.
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FAQs
It found that 62% of all consumers now live paycheck to paycheck, including 36% of those whose annual incomes exceed $200,000.
What percentage of Americans do you think live paycheck to paycheck? ›
How Many Americans Are Living 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.
Is 62 of Americans living paycheck to paycheck? ›
According to a recent report from LendingClub, a staggering 62% of adults are living paycheck to paycheck. This trend underscores the harsh reality faced by the majority of Americans, where financial insecurity has become a widespread concern.
What are the statistics for paycheck to paycheck in 2024? ›
Our survey revealed that over 66% of Americans report living paycheck to paycheck. A recent Bureau of Labor Statistics weekly earnings report indicated a 3.5% year-over-year increase in median weekly earnings for the first quarter of 2024.
What percent of people who make $200,000 live paycheck to paycheck? ›
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.
What percentage of Americans make 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% $150,000 to $199,999: 8.7%
What percent of Americans have $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%.
Can rich people live paycheck to paycheck? ›
Sizable portions of high earners live paycheck to paycheck.
The increase in consumers living this financial lifestyle is evident across income brackets. The share of consumers living this financial lifestyle and annually earning more than $100,000 has increased from last January, currently standing at 48%.
What age do people stop living paycheck to paycheck? ›
According to our survey, 58% of participants in this age group reported they are currently living paycheck to paycheck, while another 22% said they live paycheck to paycheck some of the time. The generation least likely to be living paycheck to paycheck are those aged 65 and older.
How many Americans can afford a $1000 emergency? ›
Only 44% of Americans can afford a $1,000 emergency expense, says Bankrate.
Many, it turns out, are not. A new Empower study reveals more than 1 in 5 (21%) Americans have no emergency savings — money set aside for unexpected financial events such as job loss, home and car repairs, and medical bills. Nearly 2 in 5 (37%) couldn't afford an emergency expense over $400.
What is the 20/30 rule? ›
The rule is to split your after-tax income into three categories of spending: 50% on needs, 30% on wants, and 20% on savings. 1. This intuitive and straightforward rule can help you draw up a reasonable budget that you can stick to over time in order to meet your financial goals.
How many Americans are struggling financially? ›
Almost half of Americans say they are having a hard time staying where they are financially, according to a new poll. The poll, conducted by Monmouth University's Polling Institute and released Wednesday, found 46 percent of Americans surveyed said they are struggling to remain where they are financially.
How many people over 100000 are living paycheck to paycheck? ›
More than half of Americans earning over $100,000 a year live paycheck to paycheck. So what's going on? Many experts point to a phenomenon called lifestyle inflation as one of the culprits. Lifestyle inflation, or lifestyle creep, is the pattern of spending a little more as a person's income increases.
How many people earning 250k are living paycheck to paycheck? ›
Our data finds that, in April 2022, 36% of consumers earning $100,000 to $150,000, 31% earning $150,000 to $200,000, 26% earning $200,000 to $250,000 and 24% earning more than $250,000 were living paycheck to paycheck without issues paying their bills.
How many people making six figures live paycheck to paycheck? ›
It appears that a six-figure salary isn't even enough to stave off feelings of discomfort. What used to be a signal of financial success is no longer making the bank, as 48% of those earning $100,000 or more a year say they're living paycheck to paycheck.
What percentage of individuals make over $200 K? ›
If you had an income of $200,000, that would put you in the top 12% of household incomes or the top 5% of individual incomes in 2022.
