Two kids, a near-paid-off home, and $460k income – why does financial freedom still feel so far away?

A growing number of high-earning Americans with massive incomes still don’t feel rich. Indeed, it’s not out of the ordinary to hear of a big earner who’s either living paycheck to paycheck or still feeling miles behind when it comes to retirement and financial freedom. Indeed, enter the HENRY (high earner, not rich yet) individual, who, for some reason or another, just doesn’t feel like they’re rich, even if they are considered such by outside observers.

It’s one thing for someone earning $100,000 to feel the struggle in a city where the costs of living are sky-high (think Manhattan). However, it’s another thing for someone, like this Reddit user who posted on r/ChubbyFIRE a few months ago, to have a colossal income that’s just shy of half a million and still feel behind. Indeed, it all comes down to cash flows. If you’re spending more money than is coming in, you’ll build debt, rather than savings — it really is that simple.

And for those who’ve stopped tracking expenses while giving in to “lifestyle inflation,” it can be hard to build a nest egg (real wealth) to give one a sense of financial freedom. Hiring a financial planner, getting on a budget, and going line by line on the monthly expenses is the only way to go. And while some hefty costs are unavoidable, especially for someone with two children (think college tuition and all the sort), I’d argue that if someone with a $460,000 income can’t meet such expenses, there’s a striking misalignment of priorities.

In any case, let’s look into a few reasons why this arguably rich Reddit user doesn’t feel all too rich despite their enviable income and nest egg.

Their lifestyle is way too opulent

Over the past year, our Reddit user reports having spent just shy of $200,000 on various items, including travel experiences. That’s excessive, even for someone making $460,000 a year. If you’ve achieved millionaire status but spend like one, you’ll find that financial freedom is fleeting. Sure, upgrading one’s lifestyle (the Reddit user is spending six figures annually) over saving and investing for the future seems like a sustainable move, especially if one’s high income only stands to get higher over time.

That said, recessions, economic chaos, and layoffs can happen. And they could be catastrophic for a high-income earner who’s gotten too used to living a life of luxury, with the fancy vehicles, huge houses, and appetite for designer labels. In any case, even high-income earners should aim to have a modest lifestyle that entails sustainable monthly expenses so they won’t be living like it’s a feast or famine based on what happens with their employment.

Indeed, with the threat of a tariff-fuelled recession and AI-induced automation potentially looming around the corner, it’s never been a better time to save up for a rainy-day fund, one that’s probably well larger than anyone would ever need. In any case, I’d argue that investing tens of thousands of dollars per year that would have otherwise gone to vacations, restaurants, and shopping is a wise move to get one on the right track towards feeling more financially secure in light of a more uncertain future.

The portfolio is very well-diversified. But the contributions should be higher.

Our Reddit user may be a big spender, but I’ll give them credit for having a very well-constructed portfolio. They’re 10% in bonds, 67% in the Vanguard Total Stock Market Index Fund (NYSEARCA:VTI), and 23% in the international Vanguard Total International Stock Index Fund ETF (NYSEARCA:VXUS). The portfolio is simple, it’s stock-heavy, and it’s very light on the fees (Vanguard has some of the lowest expense ratios out there).

And while the portfolio may be more aggressive, I do think that someone in their 40s can tolerate such a level of risk, especially with such a high income. If the Reddit user pulled back on their spending, they could afford to put tens of thousands more into the portfolio. After doing so, I’d bet they’d feel a heck of a lot more financially secure.

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