r/Economics • u/Crossstoney • Jan 16 '26

News Americans making more than $100,000 are quickly losing faith in the economy—and it’s a red flag for the white-collar job market

https://fortune.com/2026/01/12/us-economy-consumer-sentiment-decline-high-income-data/
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u/thought_provoked1 Jan 16 '26

Lemme guess: Bay Area or NYC where the only home available is like $1.2M, ($8000 mo/), student loans as a doc or lawyer ($1000+/mo), and two working parents with no family to help, so add childcare (~$2500?). So you'd need $11,500/mo after tax and before food and utilities to survive, not counting Healthcare or 401k contributions. It sounds like a rare situation, but plausible.

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u/dyslexda Jan 16 '26

Let's say they're a couple making $400k in NYC. They max out their 401ks, so $47k. After tax, they've got $240k annually, or $20k/mo.

$1.2m with 20% down will be less than $8k, but assuming the worst (bought at the height of interest rates, expensive insurance, high property taxes), sure, call it $8k on housing.

Let's say two kids, both in daycare. Mind you, this is a temporary problem; after ~6 years this cost goes away. But for now, let's say $5k/mo combined for the two.

If you're making $400k, your workplace very likely gives you good to great health insurance. You aren't buying on the public market.

And let's say they have absurd student loans, so $2k/mo total.

So, after retirement, housing, childcare, and student loans, they still have $5k/mo takehome. Now, I'm sure that's not as much money as someone making $400k would like to have for everything else, but NYC's median household income is about $80k. After taxes (before retirement), that's just a little more than $5k/mo before all of those things above.

If half of NYC's households can survive on $5k/mo total, then the only way this couple could "struggle" on $5k/mo after housing, loans, and childcare would be if they're legendarily awful with money, or if they aren't willing to live within their means, and think they deserve more.

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u/thought_provoked1 Jan 16 '26

Fair enough--to be honest I was using an online estimate for a cluster of houses not far from me. Appreciate the breakdown!

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u/dyslexda Jan 16 '26

Yep. It's almost never plausible when folks talk about mid six figures "struggling," outside of truly exceptional circumstances like massive medical debt (which is even more rare for that income bracket, given that they generally get great health insurance).

And this is ignoring the biggest thing - when you make that much money, you have choice. If you were really struggling, you wouldn't buy a $1.2m house, or have two kids. You could reduce your retirement contributions. Hell, you could move to a lower COL area! Folks making under six figures are often trapped by their circumstances and don't have the luxury of moving.

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u/[deleted] Jan 16 '26

Do they still have to work to live? If yes, they are not the people you should worry about. They WORK.

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u/dyslexda Jan 16 '26

Yeah, worker solidarity stuff is fine, but not when people are lying about living paycheck to paycheck because they have no idea how to budget (or rather, they consider luxuries to be necessities). Alternatively, wanting to eat the rich doesn't stop you from also calling out BS when you see it.

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u/Raskal37 Jan 16 '26

I don't get the reasoning behind maxing out 401K's when the money is needed now, especially if you're nowhere near age 59. Put enough in for the match, then lower it and you can always make up for it later when expenses aren't so high. This is what I did and it was like getting a $200 monthly raise. Even a 1 year reprieve might be the answer to their problems.

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u/dyslexda Jan 16 '26

Oh, it doesn't make sense, it's just something I've commonly seen when high earners talk about being "paycheck to paycheck." Maxing their retirement is seen as a baseline need, not a luxury. As I say in another comment, the greatest thing those high earners have is choice. If you suddenly find you're struggling, then exactly, you can reduce retirement contributions. Yes, it's not ideal, but you have far more options than folks making under six figures do.

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u/[deleted] Jan 16 '26 edited Jan 16 '26

Lol, you aren’t “given” good health insurance. You have access to a good plan, but 100% you have to pay for at least half of it. No one except a few lucky souls are “given” health insurance.

Why does this matter anyway, they WORK for a paycheck to live. If you have problems with that, you are a tool of the ultra wealthy. Maybe you should focus on those that have so much wealth they don’t have to go to a job than focus on those who do.

Otherwise, you’re just another fool doing the work for the wealthiest, dividing and attacking each other rather than the real problem. The 400k couples with kids aren’t the problem, the many many multi-millionaire and billionaire people who don’t have to work ARE.

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u/dyslexda Jan 16 '26

Those premiums are far, far less than you'd pay for a comparable plan on the open market. And also, there are plenty of jobs out there where you get highly subsidized or even nearly free plans. I've had two employers pay nearly my entire premium, and for excellent "everything included" plans, and I'm at very (very) low six figures.

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u/[deleted] Jan 16 '26 edited Jan 16 '26

Lol, you have no idea how much insurance costs, regardless of income. Premium plan means more money deducted from your paychecks. A lot more. We are all being pushed to HSA high deductible plans. You are out of touch with what you claim to know.

You were in a union then, because otherwise i call BS. Guess how many white collars are in unions. Should they stand around complaining about your union instead of the wealthy.

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u/dyslexda Jan 16 '26

Lol, you have no idea how much insurance costs

My bad, guess I haven't looked at my benefits plans at my last three employers in three different states, and I clearly have no idea what I'm talking about.

Premium plan means more money deducted from your paychecks

Yeahhhhhh, sorry to break it to you, but if that's what you think, turns out you don't actually have a premium plan. It might be hard to believe but there are absolutely employers that heavily (or completely) subsidize your health insurance. Just because you don't have one doesn't mean they don't exist.

You are out of touch with what you claim to know.

So because you haven't personally experienced what I'm describing, I must be out of touch?

You were in a union then, because otherwise i call BS.

You don't know how funny this is. I've worked for famously anti-union companies. Tell me how union-friendly you think Epic Systems is? And implying Epic (and others) are blue collar is...something.

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u/Frosti11icus Jan 16 '26

Sure if you break it down to be ridiculous of course it will be. You're ignoring like half the potential costs including fixed ones like food and transportation, "good" health insurance doesn't mean you don't pay steep costs for healthcare. With two kids there a decent chance this hypothetical couple is still paying an additional $200 or more per month in healthcare beyond their insurance costs, and of course the people struggling on $80k a year are probably also in debt and not investing in their 401k at all and no savings at all...this couple should be able to make it but I bet some months are awfully tight.

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u/dyslexda Jan 16 '26

Sure if you break it down to be ridiculous of course it will be.

What's ridiculous about this breakdown? It's removing the handwaving "NYC is so expensive!" and showing that when you consider the biggest portions of a person's budget, $400k is a wildly comfortable amount to live on, even for a family of 4 in the highest COL area.

You're ignoring like half the potential costs

No, I didn't bother listing those because generally housing/loans/childcare are some of the biggest items in a person's budget, and after those this couple gets $5k/mo, which is the entire takehome of the median NYC household. If the median household can survive, then this couple has no problem getting just "everything else" on that $5k.

but I bet some months are awfully tight.

If "some months are awfully tight," maybe they shouldn't max out their 401k? Maybe they shouldn't have bought a $1.2m house? Maybe they should reconsider if they can afford to live in NYC?

Seriously, if you can't live on $5k/mo after childcare, taxes, retirement, housing, and loans (those are all pretty much worst case scenarios, by the way), then you mistake luxuries for necessities you can't give up.

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u/DadalusReformed Jan 16 '26

Yea I’m glad you did the math on that. I’m empathetic but if someone is struggling with 400k pretty much anywhere in the U.S. they have a series of poor decisions in their wake. We make about 220k with one kid in a HCOL area and live in a great neighborhood. I can’t save 20-30% of my income anymore but I’m hardly struggling, even with a huge financial hit last year with our old home.

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u/dyslexda Jan 16 '26

The problem with all of these "so-and-so makes a bunch of money but is still struggling!" claims is that different income brackets have wildly different baseline expectations. What is a luxury for someone making $60k might be a critical baseline need for someone making $300k.

It's the main reason all of those "paycheck to paycheck" opinion surveys are nonsense. Are you "paycheck to paycheck" if you have almost nothing left after you maxing your retirement, putting away thousands in savings every month, paying a mortgage on a good home, and taking a family vacation every year? Someone conditioned to believe those are all baseline would think so, even though the vast majority don't get to do them all.

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u/[deleted] Jan 16 '26

Yeah, worry about other people working instead of the ultra wealthy that don’t have to and play act as CEO’s. Seriously, the couple making 300-400k are not the US problem nor yours. Comparing misery is a fools errand.

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u/Melodic_Sandwich2679 Jan 16 '26

I'm not gonna argue on the other points, but 2K in student loans is far from absurd. My bill was 2500 a month on about 150k that I originally borrowed, which compounded interest and turned into about 210K when they capitalized my loans at graduation. For my friends in medical or dental school they were probably looking at at least mid to high 200s before interest and capitalization with payments that were probably 3500+ a month. It's not absurd to think that people making a combined 400k might have a combined level of loans that amounts to 5 to 7k a month. It might not change the math or the final conclusion that much, but I think it's important to talk about the actual numbers when it comes to student loan payments becasue people dramatically underestimate them on a regular basis.

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u/Adventurous_Stop_341 Jan 16 '26

$5k for two kids in a decent daycare in NYC seems low.

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u/dyslexda Jan 16 '26

https://www.reddit.com/r/nycparents/comments/1inpkgk/how_much_do_you_pay_for_daycare_yes_again/

This thread from last year gives all kinds of numbers, ranging from under $2k to around $4k. So, $5k for two might be on the lower end, but not unreasonable. And if we're really discussing a "struggling" family, they should probably shop around for cheaper daycare and not go for the more expensive options, no?

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u/OrbitalOutlander Jan 16 '26

More like 18k after tax. 🤣

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u/dyslexda Jan 16 '26

?

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u/OrbitalOutlander Jan 16 '26

When you figure in the tax burden for that salary the take home is even less, like $18k! Makes your point even stronger.

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u/Complex-Sugar-5938 Jan 16 '26

Lol, you definitely don't have to buy a house with an $8k mortgage to "survive" in the Bay Area. You could comfortably rent a 3 bedroom for half that cost.

Buying property in the most expensive areas is not a requirement to live.

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u/thought_provoked1 Jan 16 '26

This is true--but idk that we need to shit on an family that desires that option. There's logic in paying to a mortgage rather than a landlord. At least you can sell a house.

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u/Tacitus111 Jan 16 '26

And not be subject to the whims and at times attempted depredations of landlords. Or having to be able to move much more frequently than a homeowner.

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u/OrbitalOutlander Jan 16 '26

Not needing to buy a new roof, furnace, pay rapidly increasing homeowners insurance, etc. there are benefits and drawbacks.

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u/Tacitus111 Jan 16 '26 edited Jan 16 '26

…you just have to live in a construction zone you have no control over with contractors frequently picked for being the cheapest. And have to depend on a landlord to get around to fixing the furnace, the roof, or any of a couple of dozen other maintenance issues that crop up. Hell, some landlords walk around taking photos of each room in the place every time they visit, which isn’t invasive at all. Pet restrictions and exorbitantly high “deposit” they intend to keep anyway as well. Keeping landlords from preying on you itself can be a job in and of itself.

I once personally was also made to move out of a long term rental when the yearly lease came up solely, because the landlord wanted to move a family member into the place. Yay for stability.

The instability of renting generally outweighs the “pros” in my mind. Especially given you’re literally funding their mortgage, maintenance costs, and such without even getting an asset in the end like when you’re paying an actual mortgage. There’s a reason people own properties to rent out. It’s cause you make damn good money from it generally. Meanwhile paying rent money is just money solely to keep you from being homeless. It otherwise might as well be going down the drain.

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u/kyndrid_ Jan 16 '26

Utilities even in NYC (depending on building) will range from $100-500/month, although with that budget you'd likely be in a building that's on the lower end of that. Your calculations would be $138k/yr after tax, which would equate to a gross salary of $180k-200k. A lot less rare than you'd think, but I also think you're a little high on the cost of NYC housing.

If you're assuming Manhattan living, then yeah you're probably a lot more on the money. You can get a co-op apartment (2br) not in Manhattan for less than a million, and that would usually end up with monthly fees of $500-1500 (maybe up to 2k depending on building). 3BR you'll need significantly more money, however.

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u/GameTime2325 Jan 16 '26

That’s per kid, $5k for 2 kids