The Blubber

Living paycheck to paycheck affects all income levels, including half of high earners (those making $100,000 or more annually) as of January 2025. Across all income brackets, individuals report a similar ability to pay their monthly bills without significant difficulty, yet still rely on their next paycheck to stay financially stable. This suggests that paycheck-to-paycheck living isn’t solely a reflection of financial hardship or an inability to cover basic needs—it also reflects how individuals choose to manage their income.

A Closer Look at the Data

In November 2024, high-income earners ($100,000+ per year) made up a larger share of paycheck-to-paycheck consumers struggling to make ends meet compared to middle-income earners. Meanwhile, from January to April 2023, nearly 25% of lower-income individuals reported not living paycheck to paycheck. However, by January 2025, that figure had dropped to just 16%.

Conversely, the share of higher-income individuals who were not living paycheck to paycheck saw a slight increase, though it fluctuated significantly over the same period. This contrast across income groups suggests that either financial pressures are affecting all income levels similarly or that higher earners are making different spending choices.

Paycheck to Paycheck: Choice vs. Necessity

These findings indicate that paycheck-to-paycheck living exists on a spectrum between necessity and choice. This framework helps explain the fluid nature of financial behaviors.

According to our research:

• 21% of American consumers (37 million people) live paycheck to paycheck purely out of necessity, facing a clear gap between their income and expenses.
• 54% (93 million consumers) do so due to a mix of spending choices and unforeseen financial events, which create short-term financial instability.
• 25% live this way predominantly by choice, opting for spending habits that align with their personal preferences rather than financial limitations.

Understanding this balance between choice and necessity provides deeper insight into why so many people, across income levels, remain reliant on their next paycheck.