What is a HENRY (And Why Financial Planning Still Matters)

Are you earning a strong income, but don’t quite feel wealthy yet? This is a situation that many young professionals find themselves in today. You’re making progress, on the road to building your financial life, but between student loans, housing costs, lifestyle upgrades, and saving for the future, your money feels stretched in every direction. 

If that sounds familiar, you might be a HENRY. HENRY stands for “High Earner, Not Rich Yet.” It’s a term used to describe individuals who have above average incomes but haven’t built significant long-term wealth. On paper, the income looks strong. But in reality, much of it is spoken for. 

So, how do you know if the label applies to you? Some common signs include: 

– You earn a high salary but don’t yet feel financially secure.

– Most of your income goes toward living expenses, debt, or lifestyle upgrades. 

– You want to invest or save more but aren’t sure where to start. 

If that resonates with you, you’re not alone. Many HENRYs are caught between strong earnings potential and the challenge of balancing debt, family responsibilities, lifestyle expectations, and long-term savings goals. The paradox of being a HENRY is that while your income is high, your expenses often rise just as quickly, which is known as a term called lifestyle creep. This makes financial planning especially important. Even at this stage, basic habits, like contributing regularly to retirement accounts, taking advantage of company benefits, and protecting your assets with the right legal documents, lay the groundwork for long-term stability. 

So, what should you do if you recognize yourself as a HENRY? The key is to shift from simply earning well to building wealth. That means: 

– Tracking where your money actually goes and being mindful of lifestyle creep. 

– Identify your short-, medium-, and long-term goals and create a strategy to achieve them. 

– Creating a comprehensive, ever-evolving financial roadmap to set you up for success. 

The transition isn’t about perfection—it’s about awareness and steady progress.  It’s easy to think, “I’ll get serious about planning once I’ve saved more.” But financial planning is most effective when it starts early. By building a roadmap now, you can avoid the cycle of lifestyle creep and set a foundation for wealth that grows with you, turning your high income into long term wealth. 

Being a HENRY is an opportunity, not a problem. It means you have the income and ambition to build wealth, but also the responsibility to make deliberate and smart financial choices with your money. The question is: are you setting yourself up to stay in the “not rich yet” stage, or are you building toward long-term financial security?  For many, the answer lies in creating a clear plan and sticking with it. That could be something you work on individually, with your partner, or with a financial professional. Choosing the right financial partner can help simplify the process and ensure your income is working toward the goals that matter most to you.  It’s never too early, or too late, to start making that shift.  So, if you are looking to build a financial plan and set up a strategy that allows your dollars to work for you, email info@shermanwealth.com or schedule a complimentary intro call here.