Posted on 10/25/2022 6:52:20 AM PDT by EBH
With persistent inflation eroding wage gains, the number of Americans living paycheck to paycheck is near a historic high, according to a recent report.
Almost half of those earning more than $100,000 say they are just getting by.
As rising prices continue to outpace wage gains, families are finding less cushion in their monthly budget.
As of September, 63% of Americans were living paycheck to paycheck, according to a recent LendingClub report — near the 64% historic high hit in March. A year ago, the number of adults who felt strained was closer to 57%.
"Consumers are not able to keep up with the pace that inflation is increasing," said Anuj Nayar, LendingClub's financial health officer.
"Being employed is no longer enough for the everyday American," Nayar said. "Wage growth has been inadequate, leaving more consumers than ever with little to nothing left over after managing monthly expenses."
Inflation has steadily caused real wages to decline.
The consumer price index, which measures the average change in prices for consumer goods and services, was up 8.2% year over year in the latest reading, still hovering near the highest levels since the early 1980s.
Real average hourly earnings fell 0.1% for the month and are down 3% from a year ago, according to the Bureau of Labor Statistics.
A separate report by Salary Finance found that two-thirds of working adults said they are worse off financially than they were a year ago.
Even high-income earners are stretched too thin, LendingClub said. Of those earning more than six figures, 49% reported living paycheck to paycheck, a jump from the previous year's 38%.
As a result, many Americans have dipped into their cash reserves or gone into debt.
(Excerpt) Read more at msn.com ...
I see it in my office of people making six figure incomes all the time. They drive brand new cars. Always have new clothes. Eat out constantly. They work for years and are still in debt.
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Many of them have a negative net worth.
Indeed some are into pain and misery.
Let's take NYC Metro for instance and assume you just reached that $100,000 salary mark.
After all taxes (including federal, state, town, FICA), that $100,000 becomes $60,000.
Deduct the average cost of a NYC area mortgage ($2,156 * 12 = $25,872) and you now have $34,128 left.
Property taxes average around $12,000 per year - now you are down to $22,128.
Average car payment is $557 * 12 = $6,684 - Now you have $15,534 left for everything else (and that's if you have just one car payment).
That's $298 a week to cover groceries, electric, gas, cable, clothing, etc.
#1 question is who did they vote for.
If Democrat, they’re getting exactly what they voted and asked for.
You’ll get no sympathy from me.
While it is true that the democrats are trying their best to ruin the economy, Americans, we the people are doing our best to aid them in this task. We are doing this because we have homes we cannot afford, cars we cannot afford, taking vacations we cannot afford, out of control lines of credit, revolving credit card and student loan debt. We are in debt up to our eyeballs and doing our best to get more.
Many of them have never sat down and worked up a balance sheet on themselves. It would open their eyes. maybe
100K is a pittance in many cities.
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Valid point. Its an enormous salary in some areas but not in others with a very high cost of living.
That said, regardless where one lives its always a good habit to carve out a portion of your paycheck to pay yourself first (savings, retirement, etc.) and learn to live off of the rest.
Learn to live below your means if you can.
NO kidding, especially if one lives in California where gas is still over $5.00/gallon as of today.
When I go to the grocery store, the bill looks like I’m entertaining my entire family for Thanksgiving or Christmas and there are only two of us - and we live modestly in a paid off home, cars paid off as well and all of our kids’ student debts paid off.
My dog’s meds doubled in price over the last month, from $60 to $120 - I was really shocked (but shouldn’t be). Vet bills have soared and they were already expensive.
Work like hell all your lives and the Democrats ruin everything
Almost half of those earning more than $100,000 say they are just getting by.
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It is not how much money you earn, it is how much money you spend.
It’s not what you earn that matters - it’s what you spend relative to what you earn.
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Profoundly true. And don’t get caught up in materialism or succumb to social pressures to keep up with the Jones. The Jones’ are in deep debt and likely on the road to insolvency and an unpleasant retirement.
You wouldn’t believe how badly my wife managed $100,000+ before we were married. MBA and everything, needless to say we go out once a month and I don’t think I’ve had a date night that didn’t involve meeting a teacher in 4 months.
We do and we’re still losing ground.
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Living in California will do that. Expensive state.
Not everyone can move to lower cost of living states but it can make can make for a far less stressful lifestyle. Just saying.
Never understood people who make good money, and yet still need to borrow to fund their lifestyles and just assume the good times will last forever - I must have lived through the depression in a previous life - my #1 goal my entire adult life (with respect to finances anyway) was to owe nobody any money, and always be able to live for a few years at least with zero new money coming in - both goals I was able to achieve by forgoing current consumption for future peace of mind in case of a rainy day.
...and it looks to me like that rainy day is coming hard and fast.
interesting, you usually only see this type of story when a Republican is president.
Financial security is about how much money is left after you’ve paid everything. Way too many people live way beyond there means. I work with people that have family incomes will over $200k that are always living paycheck to paycheck. Fancy cars, expensive vacations, second homes, massive big homes and the list goes one. As long as they can make the minimum monthly payments, they believe everything is okay.
MBA and everything...
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Its easy to drift into a high lifestyle when one earns a big paycheck. We all like to reward ourselves and treat our loved ones. That said, increasing debt servicing costs, higher taxes, rising utility costs, and a never ending variety of unexpected expenses can quickly erode one’s disposable income.
If you’re earning $100K in a place like NY or San Francisco then you are just getting by. If you’re earning that much and you live in America however, you should be able to put some away.
“The Jones’ are in deep debt and likely on the road to insolvency and an unpleasant retirement”.
Spot on.
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