Goldman Sachs: 40% of $400-500K and $500K+ households “live paycheck to paycheck”

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:It’s hard to know what is accurate in this area. High end shops here seem filled with buyers. Are there that many wealthy people, or are people throwing money away that they can’t afford? I assume both.

What kind of high end shops are you talking about?

I’m specifically talking about the 20-30 minutes waits to get help at Chanel, Gucci and Louis Vuitton I experienced on Saturday. Lots of men and women walking out with big bags. Mostly young people in the line.

The people I see at these shops don’t look like they make $400K. They’re buying $4000 bags but wearing spandex and pushing junky strollers.

I carry a $5K YSL and a $3K Loewe, wear mostly gap/BR/jcrew and drive a 2015 Toyota with a nice gash in the side that I haven’t bothered to fix.

We make $400K, save a crap ton and have millions in savings.

Women are funny about luxury bags. It’s my personal weakness.

glad it’s not mine! our HHI is double yours and it’s on one income and I don’t even carry a purse, would look weird in my perpetual uniform that consists of yoga pants and sweatshirts or scrubs for my messy hobbies! My wallet is my phone. My weakness is high quality food ( I love to cook), gym/wellness memberships, and my very expensive art habit (creating not buying).

However we do fork our money over to a money manager and essentially live off what i refer to as an allowance.

How embarrassing… we make more than you and would never talk like this. And bragging about paying a money manager… they must make a killing off that $800K :lol:

[Anonymous]

Anonymous wrote:I think this partly happens because someone making 400k thinks they should have everything their neighbor has, but they don’t realize their neighbor is making north of a million.
We’ve made more 1.1 the last two years, and none of our friends would have any idea. We save a lot, and spend a lot- but we could not have sustained this on a 400k salary.

You also don't have any idea what your friends make. They could be practicing stealth wealth just like you are. I would never tell anyone my income no matter how close of a friendship I had.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:It’s hard to know what is accurate in this area. High end shops here seem filled with buyers. Are there that many wealthy people, or are people throwing money away that they can’t afford? I assume both.

What kind of high end shops are you talking about?

I’m specifically talking about the 20-30 minutes waits to get help at Chanel, Gucci and Louis Vuitton I experienced on Saturday. Lots of men and women walking out with big bags. Mostly young people in the line.

The people I see at these shops don’t look like they make $400K. They’re buying $4000 bags but wearing spandex and pushing junky strollers.

I carry a $5K YSL and a $3K Loewe, wear mostly gap/BR/jcrew and drive a 2015 Toyota with a nice gash in the side that I haven’t bothered to fix.

We make $400K, save a crap ton and have millions in savings.

Women are funny about luxury bags. It’s my personal weakness.

glad it’s not mine! our HHI is double yours and it’s on one income and I don’t even carry a purse, would look weird in my perpetual uniform that consists of yoga pants and sweatshirts or scrubs for my messy hobbies! My wallet is my phone. My weakness is high quality food ( I love to cook), gym/wellness memberships, and my very expensive art habit (creating not buying).

However we do fork our money over to a money manager and essentially live off what i refer to as an allowance.

How embarrassing… we make more than you and would never talk like this. And bragging about paying a money manager… they must make a killing off that $800K :lol:

I was thinking the same thing PP. Most money managers charge 2% AUM fees doing something you could easily do yourself and in very little time. I'm sure your MM is laughing all the way to the bank.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:This is crazy to me, see page 20:

https://am.gs.com/cms-assets/gsam-app/documents/insights/en/2025/am-retirement-survey-102025.pdf?view=true

Lots of wild details in this document on “The Future of Retirement”

I can relate. We are in the same income bracket. We live paycheck to paycheck after maxing out 401k, hsa, saving 10k per kid in 529, saving 60k in our brokerage account. We don’t have much left.

Similar. We'd live paycheck to paycheck, no matter how much we make, because my spouse is an overspender and would be at any income level. Instead of one country club and house, we'd have five. I max out 401k, 529 plans ($19k per kid per year), and put over $50k per year into my brokerage account; spouse can't access any of those accounts. We are effectively broke in our joint checking account at the end of most months.

What you describe has no relation to brokeness. Spreading hundreds of thousands into different pots that you own just means you have hundreds of thousands of dollars squirreled away. You don’t become broke by ignoring the pots you stash your money in.

[Anonymous]

Anonymous wrote:

Anonymous wrote:I think this partly happens because someone making 400k thinks they should have everything their neighbor has, but they don’t realize their neighbor is making north of a million.
We’ve made more 1.1 the last two years, and none of our friends would have any idea. We save a lot, and spend a lot- but we could not have sustained this on a 400k salary.

You also don't have any idea what your friends make. They could be practicing stealth wealth just like you are. I would never tell anyone my income no matter how close of a friendship I had.

Most of our friends throw their salaries / HHI into casual convos with us and the numbers generally make sense w their careers. We never share what we make so I do think part of it is them fishing for info from us.

We’re all early / mid 30s. I don’t think salary / HHI is a big secret for Gen Z and younger Millennials than it is with older people. Maybe that’ll change over time but we’ve also with 2008 and COVID how unless you own your own business, any high W2 salary is a gift. So we don’t put as much of our value or self worth into it as I think 40+ Millennials and Gen X do which makes it less of something to “hide” or never share.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I think this partly happens because someone making 400k thinks they should have everything their neighbor has, but they don’t realize their neighbor is making north of a million.
We’ve made more 1.1 the last two years, and none of our friends would have any idea. We save a lot, and spend a lot- but we could not have sustained this on a 400k salary.

You also don't have any idea what your friends make. They could be practicing stealth wealth just like you are. I would never tell anyone my income no matter how close of a friendship I had.

Most of our friends throw their salaries / HHI into casual convos with us and the numbers generally make sense w their careers. We never share what we make so I do think part of it is them fishing for info from us.

We’re all early / mid 30s. I don’t think salary / HHI is a big secret for Gen Z and younger Millennials than it is with older people. Maybe that’ll change over time but we’ve also with 2008 and COVID how unless you own your own business, any high W2 salary is a gift. So we don’t put as much of our value or self worth into it as I think 40+ Millennials and Gen X do which makes it less of something to “hide” or never share.

I'm pretty sure I have discussed my salary at some point with friends -- starting out we all compared and as we've made changes we do discuss the risk/reward of taking a pay cut or jumping to something riskier for more money. Everyone has a salary so everyone can kind of participate in those discussions. But a significant portion of our HHI now comes from non-W2 sources, and we don't talk about that as much because it's not a point of connection. Not many of our friends have rental properties or the specific mix of investments we do, so bringing those up would seem more like bragging then conversing. I imagine people with trust funds are the same -- they might talk about the bonus they're getting this year with other friends in their industry but not about their distributions because it would not be socially intelligent.

[Anonymous]

So most of Goldman Sachs employees?!?

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I think this partly happens because someone making 400k thinks they should have everything their neighbor has, but they don’t realize their neighbor is making north of a million.
We’ve made more 1.1 the last two years, and none of our friends would have any idea. We save a lot, and spend a lot- but we could not have sustained this on a 400k salary.

You also don't have any idea what your friends make. They could be practicing stealth wealth just like you are. I would never tell anyone my income no matter how close of a friendship I had.

Most of our friends throw their salaries / HHI into casual convos with us and the numbers generally make sense w their careers. We never share what we make so I do think part of it is them fishing for info from us.

We’re all early / mid 30s. I don’t think salary / HHI is a big secret for Gen Z and younger Millennials than it is with older people. Maybe that’ll change over time but we’ve also with 2008 and COVID how unless you own your own business, any high W2 salary is a gift. So we don’t put as much of our value or self worth into it as I think 40+ Millennials and Gen X do which makes it less of something to “hide” or never share.

I'm pretty sure I have discussed my salary at some point with friends -- starting out we all compared and as we've made changes we do discuss the risk/reward of taking a pay cut or jumping to something riskier for more money. Everyone has a salary so everyone can kind of participate in those discussions. But a significant portion of our HHI now comes from non-W2 sources, and we don't talk about that as much because it's not a point of connection. Not many of our friends have rental properties or the specific mix of investments we do, so bringing those up would seem more like bragging then conversing. I imagine people with trust funds are the same -- they might talk about the bonus they're getting this year with other friends in their industry but not about their distributions because it would not be socially intelligent.

PP - I actually typed out “except for trust fund type situations” and deleted it haha. Agree on the rental property stuff too - we inherited 3 investment properties and have never mentioned that.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:It’s hard to know what is accurate in this area. High end shops here seem filled with buyers. Are there that many wealthy people, or are people throwing money away that they can’t afford? I assume both.

What kind of high end shops are you talking about?

I’m specifically talking about the 20-30 minutes waits to get help at Chanel, Gucci and Louis Vuitton I experienced on Saturday. Lots of men and women walking out with big bags. Mostly young people in the line.

The people I see at these shops don’t look like they make $400K. They’re buying $4000 bags but wearing spandex and pushing junky strollers.

I carry a $5K YSL and a $3K Loewe, wear mostly gap/BR/jcrew and drive a 2015 Toyota with a nice gash in the side that I haven’t bothered to fix.

We make $400K, save a crap ton and have millions in savings.

Women are funny about luxury bags. It’s my personal weakness.

glad it’s not mine! our HHI is double yours and it’s on one income and I don’t even carry a purse, would look weird in my perpetual uniform that consists of yoga pants and sweatshirts or scrubs for my messy hobbies! My wallet is my phone. My weakness is high quality food ( I love to cook), gym/wellness memberships, and my very expensive art habit (creating not buying).

However we do fork our money over to a money manager and essentially live off what i refer to as an allowance.

How embarrassing… we make more than you and would never talk like this. And bragging about paying a money manager… they must make a killing off that $800K :lol:

Wealth is more than just w2 income, just an FYI. Among many strategies we have we also have a CRT, which is extremely complicated along with an irrevocable trust.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I think this partly happens because someone making 400k thinks they should have everything their neighbor has, but they don’t realize their neighbor is making north of a million.
We’ve made more 1.1 the last two years, and none of our friends would have any idea. We save a lot, and spend a lot- but we could not have sustained this on a 400k salary.

You also don't have any idea what your friends make. They could be practicing stealth wealth just like you are. I would never tell anyone my income no matter how close of a friendship I had.

Most of our friends throw their salaries / HHI into casual convos with us and the numbers generally make sense w their careers. We never share what we make so I do think part of it is them fishing for info from us.

We’re all early / mid 30s. I don’t think salary / HHI is a big secret for Gen Z and younger Millennials than it is with older people. Maybe that’ll change over time but we’ve also with 2008 and COVID how unless you own your own business, any high W2 salary is a gift. So we don’t put as much of our value or self worth into it as I think 40+ Millennials and Gen X do which makes it less of something to “hide” or never share.

I'm pretty sure I have discussed my salary at some point with friends -- starting out we all compared and as we've made changes we do discuss the risk/reward of taking a pay cut or jumping to something riskier for more money. Everyone has a salary so everyone can kind of participate in those discussions. But a significant portion of our HHI now comes from non-W2 sources, and we don't talk about that as much because it's not a point of connection. Not many of our friends have rental properties or the specific mix of investments we do, so bringing those up would seem more like bragging then conversing. I imagine people with trust funds are the same -- they might talk about the bonus they're getting this year with other friends in their industry but not about their distributions because it would not be socially intelligent.

I get it. We're in the same boat with substantial non-W2 passive income but we never disclose our salaries or income with anyone. Ever. It's no one's business for various reasons. As a PP said, practicing stealth wealth is a real thing.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:Yea I do not understand people, this year it looks like we will hit about 800K (two incomes). Between us we will have put 47k into 401K before employer contribution and another 40K of after tax mega roth money. We then do direct deposit of 30% of our net income into our brokerage account at every pay cycle. Even after forking over ~222,000 each year to retirement and taxable investments, we still are left to blow 23,000/mo on life. The key for us is we do all of this out of payroll deductions so there is no lifestyle creep, we never see that money.. And yes, we do have a 2nd home and do drive expensive cars and do take ski trips out to the rockies. At this point our investments are like having 3rd full time wage earner in the house. Our growth last quarter was around 250K...not bad for 3 months of work! And yes at age 48 if we both lost our jobs we could get by on taking a low wage job just for the health insurance. We would not lose our home, our kids would still have college paid for and we still would live a good life.

If you make our income and are strapped and not reaching your short and long term financial goals you are a complete and total moron.

Curious, what’s your net worth? We are 44/43 and very similar financials.

to be honest i don’t really know. My spouse handles all of the finances and we just do a “state of the union” twice a year. All I know is what we contribute and that we have never pulled money out. We also have rentals that i pay exactly zero attention to which factor into NW. Probably 8M? he just makes grand announcements when we have a particularly good quarter.

Similar here but I’m retired. I don’t do ski trips to the Rockies. That’s so UMC. Ski every year in the Alps either Switzerland or Austria. We make over $800K/yr tax free.

Anyone who says “that’s so UMC” won’t really fit in any wear. Your income is UMC but you just have to ski with the people you wish you were. Social climbing can’t be comfortable.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I think this partly happens because someone making 400k thinks they should have everything their neighbor has, but they don’t realize their neighbor is making north of a million.
We’ve made more 1.1 the last two years, and none of our friends would have any idea. We save a lot, and spend a lot- but we could not have sustained this on a 400k salary.

You also don't have any idea what your friends make. They could be practicing stealth wealth just like you are. I would never tell anyone my income no matter how close of a friendship I had.

Most of our friends throw their salaries / HHI into casual convos with us and the numbers generally make sense w their careers. We never share what we make so I do think part of it is them fishing for info from us.

We’re all early / mid 30s. I don’t think salary / HHI is a big secret for Gen Z and younger Millennials than it is with older people. Maybe that’ll change over time but we’ve also with 2008 and COVID how unless you own your own business, any high W2 salary is a gift. So we don’t put as much of our value or self worth into it as I think 40+ Millennials and Gen X do which makes it less of something to “hide” or never share.

Part of Gen Z is still in middle school, high school, college. There are only a small amount of Gen Zs in their middle 20s. I wish people would stop talking about Gen Z as if they have accomplished anything when the majority of them are not even adults.

You are part of the Millenials and you all don’t have high incomes.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:It’s hard to know what is accurate in this area. High end shops here seem filled with buyers. Are there that many wealthy people, or are people throwing money away that they can’t afford? I assume both.

What kind of high end shops are you talking about?

I’m specifically talking about the 20-30 minutes waits to get help at Chanel, Gucci and Louis Vuitton I experienced on Saturday. Lots of men and women walking out with big bags. Mostly young people in the line.

The people I see at these shops don’t look like they make $400K. They’re buying $4000 bags but wearing spandex and pushing junky strollers.

I carry a $5K YSL and a $3K Loewe, wear mostly gap/BR/jcrew and drive a 2015 Toyota with a nice gash in the side that I haven’t bothered to fix.

We make $400K, save a crap ton and have millions in savings.

Women are funny about luxury bags. It’s my personal weakness.

glad it’s not mine! our HHI is double yours and it’s on one income and I don’t even carry a purse, would look weird in my perpetual uniform that consists of yoga pants and sweatshirts or scrubs for my messy hobbies! My wallet is my phone. My weakness is high quality food ( I love to cook), gym/wellness memberships, and my very expensive art habit (creating not buying).

However we do fork our money over to a money manager and essentially live off what i refer to as an allowance.

How embarrassing… we make more than you and would never talk like this. And bragging about paying a money manager… they must make a killing off that $800K :lol:

Wealth is more than just w2 income, just an FYI. Among many strategies we have we also have a CRT, which is extremely complicated along with an irrevocable trust.

A Charitable Remainder Trust is extremely complicated for who?

[Anonymous]

You can EASILY live paycheck to paycheck if you make 400K-500K a year in any metropolitan area in the US like the DMV! and that's not even living a luxurious lifestyle or being irresponsible with your money, ESPECIALLY if you have 1-2 kids in private school. You're basically making about $300K after taxes, so $25K a month.

If you live in a 1.2M home (and that's a very basic home in many parts of DC, Tysons, McLean or Bethesda), you're probably paying $7.5K for mortgage, 2 kids in private school is also about $7.5K a month, home upkeep, utilities and repairs are $1.5K, groceries and household supplies is $2.5K, gas/ car repairs/ tolls is another 0.5K, I am assuming your cars are paid off. Kids 529 is another 1K a month. If you and your spouse work outside the house, you will need some type of part time helper/sitter on some afternoons, so that's 1.5K a month.

So there, we are already at 22K a month. We have not even talked about clothing, eating out, travel, any out of pocket medical expenses, any type of extra curriculars or sports for the kids . I am assuming you don't even have a pet and your company pays 100% of your health insurance.

See how easy it adds up?

[Anonymous]

Anonymous wrote:You can EASILY live paycheck to paycheck if you make 400K-500K a year in any metropolitan area in the US like the DMV! and that's not even living a luxurious lifestyle or being irresponsible with your money, ESPECIALLY if you have 1-2 kids in private school. You're basically making about $300K after taxes, so $25K a month.

If you live in a 1.2M home (and that's a very basic home in many parts of DC, Tysons, McLean or Bethesda), you're probably paying $7.5K for mortgage, 2 kids in private school is also about $7.5K a month, home upkeep, utilities and repairs are $1.5K, groceries and household supplies is $2.5K, gas/ car repairs/ tolls is another 0.5K, I am assuming your cars are paid off. Kids 529 is another 1K a month. If you and your spouse work outside the house, you will need some type of part time helper/sitter on some afternoons, so that's 1.5K a month.

So there, we are already at 22K a month. We have not even talked about clothing, eating out, travel, any out of pocket medical expenses, any type of extra curriculars or sports for the kids . I am assuming you don't even have a pet and your company pays 100% of your health insurance.

See how easy it adds up?

.

$300K is the new $500K is the new $750-1M in terms of what your HHI gets you now