Goldman finds 37% of people earning over $500,000 live paycheck to paycheck

Put side by side, the finer income bands reported by American Banker place the top of the scale closer to the bottom than to the middle. The 37% above $500,000 is 5 points below workers earning under $100,000 and 15 points above the 22% earning $100,000 to $200,000 ^[4][1]. Most of the climb happens at one threshold. The share rises from 25% in the $200,000 to $300,000 band to 34% at $300,000 to $500,000, a 9-point step, then adds 3 points above $500,000 ^[3][4][2]. American Banker's finer bands and The Daily Upside's coarser ones agree with each other ^[3].

Paycheck to paycheck describes monthly cash flow, and Goldman's write-up is careful about how far that finding stretches. "Certain financial concerns also appeared among some higher-income households, although the nature and retirement implications of those concerns may differ from those experienced by lower-income households," the survey results said ^[6].

The 37% supports more than one reading. One is liquidity: a household with a large retirement balance and heavy fixed costs can spend every monthly dollar and still be on course. Another is real under-saving at high incomes. A third is noise. The 5,106 respondents are split across at least five income bands, and a 3-point gap between the top two may not hold up in a bigger sample ^[1][4][2].

I think the second reading has the better evidence behind it. According to The Daily Upside's account of the survey, high earners report delaying financial goals, worrying about retirement savings and struggling to pay off monthly credit card debt at rates that look similar to those of lower earners ^[7]. The view is wrong if Goldman's balance data shows that the $500,000-plus households who answered yes hold savings at or above target. The published results do not split balances by income.

Goldman's prescription moves the advice away from contribution rates. "If workers' saving ability is being constrained by a variety of forces, the answer among the industry cannot be continuing to tell people to figure out how to save more," said Christopher Ceder, senior retirement strategist at Goldman ^[8]. Wyatt Lee, head of target-date strategies at T. Rowe Price, pointed to private credit and private equity. He said both have historically generated excess returns over comparable public-market investments ^[16]. "If you're just playing in the public markets, your opportunity set is limited," Lee said ^[10]. On retirees, he said, "We're recommending that they should still have a substantial exposure to equities, and they just shouldn't be fully de-risked" ^[11]. He added that demand for annuities has risen and that advisors "are ideally placed to be able to talk about them because many individuals are reluctant to annuitize on their own" ^[12].

Each of those remedies changes where existing assets sit, and both men work for asset managers ^[9][18]. A household above $500,000 that spends its whole paycheck has the same monthly budget after a change of asset mix. Leah Schwarz, managing director of Perspective Wealth, which partners with Steward Partners, describes her approach in cash-flow terms. "The numbers don't lie, and so I think I consistently show people, 'Hey, this is where you are. This is what you can generate,'" she told Financial Planning ^[17].