- A millennial living in California who makes six figures says he would need to triple his income to feel “wealthy.”
- They feel their income is insufficient due to rising house prices, surrogacy costs and student loan repayments.
- He explained why he's hesitant to leave Santa Monica, despite the high housing market.
Christopher Stroup's only priority is Without the savings, he might not be living in the Los Angeles area.
The 33-year-old Santa Monica, California-based financial advisor made about $130,000 last year, according to documents reviewed by Business Insider. But he said he's still paying off student loans and working toward savings goals for a down payment on a home, starting a family, and retirement, which is why he says he feels far from “rich.”
“Compared to the traditional course of life, I feel like I'm behind financially,” he previously told BI in an email.
Stroup estimated that to feel “wealthy,” he would need to earn about $400,000 to $500,000 a year, more than triple what he'll be making in 2023. At this income level, he estimated, he'd be able to hit his savings goals, enjoy life, and have some money left over.
Stroup said there's another way you might feel wealthy even if you can't increase your income to the level you'd like: move to an area with lower housing costs.
“I rent a 450-square-foot alcove studio in Santa Monica for $1,650 a month,” Stroup previously told BI. “My sister who lives in Cincinnati rents a 1,600-square-foot house with three bedrooms, two-and-a-half bathrooms, and a backyard for $1,800.”
Stroup belongs to a group of Americans sometimes called “henries” (high-income but not yet wealthy) who make six figures but still struggle to achieve some of their financial goals.
In recent years, rising prices have put a strain on people's finances, so a $100,000 annual salary is no longer as affordable as it used to be. The US housing market is one of the main reasons. In recent years, soaring home prices and rising mortgage rates have put homeownership out of reach for many Americans. Business Insider spoke to several Americans who have moved to other states in recent years in search of relief from rent or mortgage payments.
The vast majority of millennials will own their homes as of 2022, according to a 2023 analysis from apartment information service RentCafe. But that's little consolation for millennials like Stroup, who face a more expensive housing market. Of course, for the majority of Americans who don't make $100,000 (the median full-time annual salary was about $84,000 as of March), buying a home is even harder.
Stroup spoke about whether he plans to move to a place with lower housing costs, as housing costs can be particularly expensive, especially when considering starting a family.
Starting a family can cost as much as a down payment on a house.
Stroup sometimes jokes that he needs to save up $250,000 to buy a house, start a family or become a partner in a firm, but he says he can only choose one of those things.
The median sales price for a home in Santa Monica was about $1.5 million as of April, according to Zillow. A 17% down payment on a home at that price would amount to about $250,000.
Additionally, Stroup, who is gay, said family planning can be “very expensive” if a gay couple chooses surrogacy over adoption. He said the total cost of surrogacy can easily exceed six figures.
“These are the expected costs if you have just one child,” he says. “Realistically, you want at least two children, so you need to get serious about financial planning.”
And those are just the initial costs: In January, Business Insider estimated that it will cost parents about $26,000 to raise a small child in 2024.
Finally, Stroup said that the “buy-in” for partners at his firm starts at $250,000, meaning that you have to pay this amount to “own a piece” of the company you work for.
Given all these expenses, it might make sense for Stroup to move somewhere with lower housing costs, but he says there's at least one reason he doesn't want to leave the Los Angeles area anytime soon: The area has a strong LGBTQ+ community.
Stroup said he gained insight into the trade-offs between cost of living and community while living in Bakersfield, California, for several years.
“The cost of living in Bakersfield is much lower than in Los Angeles, so I was able to save money and pay off my debts,” he says, “but it's not a very welcoming environment for gay men, so I had to sacrifice my personal life.”
If Stroup were to move, he would have plenty of options because his job allows him to work fully remotely: He grew up in Troy, Pennsylvania, and said he would consider moving back there one day to be closer to family.
“Financially speaking, housing and child care costs will be much lower,” Stroup says. “You'll be able to rely on your family more, which will be a welcome benefit when you're raising children.”
For now, Stroup said he's grateful to feel “richer” in three areas of life that aren't tied to a bank account: freedom, control and fulfillment.
He said his job gives him a lot of freedom and control in his day-to-day life, and that tasks such as helping members of the LGBTQ+ community manage their finances bring him “great fulfillment”.
“Although my income is not enough to be considered 'rich' from a financial standpoint, I currently meet those three criteria,” he said.
Do you earn more than $100,000 a year? Would you like to share your story about how this income has impacted your life? If so, please contact this reporter. jzinkula@businessinsider.com.
