Kyle, a 34-year-old technician who makes $ 175,000, lived a HENRY life in the Bay Area before the pandemic. He was well paid and not yet rich. He paid $ 2,500 in student loans and $ 4,300 in rent every month. He saved less than $ 10,000 a year and put away $ 80,000 after moving to Phoenix to work remotely. Loading Something is loading. Kyle used to be a HENRY, short for “high earner, not yet rich”. Prosperity thanks to the world of remote work. After completing his doctorate, he spent the last five years as a big data specialist in California in the tech scene. He made $ 120,000 on his first job in 2016, according to an Insider-verified payroll, and increased his salary at his next company after moving to the Bay Area. But Kyle saw little of his six-figure paycheck and found himself in the HENRY lifestyle. HENRYs are typically millennials in their early 30s, earn over $ 100,000, and live in urban areas. They often feel like they have to live from paycheck to paycheck struggling to save, either because they fall prey to lifestyle sneaking and live beyond their means, or because they have a high cost of living today in an economy where the $ 100,000 is no longer what it used to be. In some cases, like Kyle, it’s both. “My personal anecdote is that some people get too caught up in the patterns of their current lifestyle,” he said. “Sometimes that has nothing to do with the material costs.” He said his money was usually put on his credit card for sky-high rents, $ 2,500 a month in student loans, and large items like furniture and kitchen utensils. He had gotten into a vicious circle of debt. After spending a few years paying off everything, the pandemic struck. It opened up a game changing opportunity: he got a new job with permanent remote work and a base salary of $ 175,000 per payroll. It enabled him to trade in for his hometown of Phoenix in the Bay Area last September and give up his HENRY lifestyle. “I have more than halved my cost of living,” he said. While he typically saved between $ 5,000 and $ 10,000 a year in California, he added, he lost $ 80,000 last year. “Working from home provides an unprecedented opportunity for young people to break out of the debt cycle.” Confessions from a former HENRYKyle said he could not imagine working in the Bay Area again after the pandemic I cannot believe how inappropriately expensive it all was, ” he said. “Cost didn’t seem to be a major issue at the time as I got by on a technician salary, but I’ve certainly been priced in by the accumulation of upward moving assets like homes.” The Bay Area is known for its notorious upscale real estate market, with New York City trading as the most expensive in America. Kyle said a 1,200 square foot craftsman house on the street he lived on sold for $ 2.1 million prior to the pandemic housing boom, and that kind of house inflation has only made home ownership harder. A friend of his, he added, has been struggling for over one He spent a year buying a home in the area and recently lost an offer on a townhouse after submitting an offer of $ 60,000 above the asking price. Kyle said he spent $ 4,300 a month renting a two-bedroom, two-bathroom apartment in the Bay Area. He eventually became a homeowner after moving to Phoenix, one of the migration hotspots of the pandemic, where he pays $ 1,043 a month for his three-bedroom, two-and-a-half bathroom mortgage. His other monthly costs have also dropped tremendously since the move. Based on his bank statements, he estimated he was spending $ 3,700 a month on top of renting in the Bay Area, which now looks more like $ 1,500 a month in Phoenix. Kyle said he still longs for California, misses the food and social activities. but doesn’t miss the cost of living and traffic. “There is a huge financial opportunity for those with work flexibility to benefit from migrating to cheaper subways,” he said, adding that it is still difficult to convince people otherwise. Kyle points out, however, that everyone views utility – an economics term that refers to the level of happiness that comes from consuming a product or service – differently. “he said.” I’ve managed to improve both of these in the last year, but for others it’s still a tough compromise. “Do you have a story about your HENRY life? Contact Hillary Hoffower at hhoffower@insider.com. Hillary Hoffower Correspondent, Millennial Wealth Hillary covers the intersection of youth culture and wealth, looking at the business, lifestyle and financial behavior of millennials, trends in how wealthy millennials live and spend, portrays millennial entrepreneurs, and examines how She has been immersed in the luxury landscape as well. She has studied the Côte d’Azur pandemic party problem, explored the Israeli luxury real estate market, and watched the ultra-rich in conspicuousness in the name of safety Here is a selection of her work: – The world’s youngest self-made billionaire ft to power any future self-driving car with technology Elon Musk says is “doomed” – Tiffany and the Trumps: Insiders Describe How the President’s Younger Daughter Made the Charts What they say is one distant relationship with her father and coping with having the most divisive surname in America – Yachting insiders describe rampant sexual harassment aboard million dollar ships where crew members are promised a glamorous lifestyle and are instead trapped at sea, No one could turn to – Millennials emerged from the Great Recession with massive student debt and troubled finances. Here’s what the generation will struggle with if the coronavirus causes another recession. – Class of the Year 2020: A Look at Generation Z Moving Into Chaos – How The American Millennial Is Overcoming The Debt, Dollar, And The Economy That Was Handed To Them – College Is More Expensive Than Ever And The 5 Reasons Speaking of It It’s only getting worse Hillary joined Business Insider in 2018 and reported on personal finance. Let her know what millennials are doing with their money by contacting her at hhoffower@businessinsider.com. Follow her on Twitter @hillary_tweets. Read more Read less
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