One of the most dangerous money myths that still pervades to this day is that the more money you earn, the better you become at managing it. For most of us, our income trajectories throughout the lifetime of our careers will be pretty standard. We start out earning modest amounts, and as time goes on and our skills and experience grows, so too do our wages.
The bad habits of these HENRYs is something all of us can be or are guilty of, no matter our income bracket. Credit: Dionne Gain While some people are brilliant budgeters who use their salary increases as an opportunity to save money and work towards long-term wealth accumulation goals like owning property and creating an investment portfolio, lots of us simply begin to spend more as we earn more. It’s an easy thing to do, especially when it happens incrementally.
You’ve just got a promotion, so why not take a holiday where you treat yourself to five-star hotels? Or you upgrade the family car, but instead of a budget-friendly model, you go for something a little more luxurious? Perhaps you decide to hire a house cleaner, or you find yourself ordering takeaway or dining out more often because you’re working long hours. Maybe you received a performance bonus and splash out on a gift to yourself to celebrate your hard work. Whatever the situation, this creep of spending usually happens incrementally.
Then one day, you wake up and realise you’ve become a HENRY. Yes, there’s a snazzy little acronym for these people: H.