High Earners, Not Rich Yet - March 13, 2026

“HENRY’s” - they call them

I recently read about a term being applied to people in the late Gen Z or Millennial age cohorts (late 20s to mid 40s), who are earning a substantial income but have yet to accumulate significant wealth. That term being “HENRYs”, or “high earners, not rich yet”.  In this context, a substantial income is between $100,000 and $500,000 per year. An annual salary/income in this range may seem like a lot, and it is, when we consider that the average salary in Canada is $67,000, and the average salary in the United States is $60,000.  

But, consider that typical wealth tiers used by economists and banks are as follows: 

• Upper middle class: about $500,000 – $2 million net worth

• Millionaire: $1 million+ net worth

• Affluent / Rich: roughly $2–5 million+

• Very rich: $10 million+

• Ultra-rich: $30 million+ (often called Ultra High Net Worth Individuals)

And, consider that high income earners typically pay 40% of their earnings in income taxes, which means that people in this earnings bracket are taking home $60,000 to $300,000 per year.  From this after-tax amount they still have to eat, pay their rent or mortgage, pay for other living expenses, potentially pay off student loans, and have some fun money.  Depending on where they live they may have zero money left over for savings, or emergency expenditures.  

“HENRY’s” face a savings challenge for several reasons; they earn a lot, but spend a lot too. High earners tend to live in expensive metro areas such as, New York City, San Francisco, London and Tokyo, among other places, where housing, childcare, and general costs are quite high. A $200,000 salary can feel surprisingly tight in San Francisco after taxes, rent, and daycare.  Lifestyle creep is also real. As income rises, so do expectations: a nicer apartment, a more expensive car, more travel, private schools for your children. Spending scales up almost automatically, which leaves little for saving and investing.

If they are smart and control their daily spending, people may be fortunate enough to save 10-20% of their after-tax pay, which in this salary range works out to be $9,000 to $45,000 per year (using the midpoint of 15% of after-tax pay as a savings target).  If you’re fortunate enough to be at the upper end of the HENRY salary range (and saving $45,000 per year)  it would take you over 44 years to reach the entry point of the Affluent/Rich wealth category noted above (without any form of investment strategy or compound growth…spoiler alert). If you're at the lower end of the HENRY earning range (and saving $9,000 per year) it’ll take over 200 years to reach two million dollars in savings…in other words, it’s not happening!  

This term is commonly used in personal finance and wealth management circles, as HENRYs represent a demographic that could build substantial wealth but needs to be deliberate about saving and investing to get there. Financial advisors often target this group as future high-net-worth clients.​​​​​​​​​​​​​​​​ But this group arrives late to investing. Many spent their 20s in school (grad school, law school, med school), accumulating debt rather than assets. By the time they earn large amounts, they’re playing catch-up while their peers who started investing earlier have benefited from years of compound growth.  To deliver the message that savings, investing and modest spending are important to their future, I’d suggest wealth advisors, parents and mentors create Tik-Tok videos or Instagram Reels aimed at HENRYs with the message that your salary won’t make you rich, but compound growth on savings/investments will!  These age cohorts get a lot of their advice, and their views are often shaped by what they see on these forms of social media.  

The key issue here is that income is not wealth. High income earners can live a very comfortable life off their after-tax money earned every month.  But as we pointed out earlier you won’t get rich on a high salary.  Wealth comes from owning assets; stocks, real estate, or a business that grows and generates returns. Whenever I’m drawn into this conversation with a person in these age cohorts, I advise them to take their after-tax money at the end of each month, and put some of it into each of three buckets: one - for immediate monthly expenses, such as rent/mortgage, food, living expenses; two - near-term expenses such buying a new car, new furniture or new golf clubs; three - long-term savings for retirement…this is where wealth is generated; this is how you get rich. If you’re at the high end of the HENRY earning bracket, and can save up to $45,000 per year;  by investing that savings wisely your money can appreciate substantially due to compound growth.  With this amount of savings each year, even earning 5% on that savings each year, you’ll enter the Rich category (net worth of $2M or more) in 24 years. Compound growth on the same annual savings amount shaves 20 years off your path to becoming wealthy, potentially making you a millionaire before the age of fifty!  

It may seem odd for a twenty-something to be thinking about retirement, but the sooner one puts money away in long term savings, and puts that money to work, having it compound, the sooner they will achieve financial independence, and become rich. 

Being rich doesn’t buy you happiness, but it does buy you freedom and independence. Investing for the long-term, as early as possible, ensures you won’t remain a HENRY forever. 

Note:  I did not publish an article last week, as I was celebrating a milestone birthday with friends and loved ones, and between celebrating and travelling I did not find any quiet time for writing.  Thank you to my regular readers for your patience.