The HENRY Dilemma – avoid the traps

It’s a common problem: “I’m making good money, but I don’t have much to show for it.”

I was introduced to a term recently that you’ll find alarmingly familiar – HENRY, which stands for ‘High Earner, Not Rich Yet.’

Does this sound like you?

Earning a healthy salary is one thing, but it doesn’t automatically make you ‘rich’. That’s a different ballgame.

And while we all have our unique visions of ‘rich’, for me, it’s about replacing my salary with investment income.

What are the common traps for HENRYs, and how can you sidestep them?

Trap 1: Weak money habits

Managing money is like building muscle.

I’ll explain this through the prism of an elite athlete.

You don’t expect to execute an elite athlete’s regimen overnight. It starts with mastering the basics – building fitness, strength, and coordination over time.

Elite athletes make things look easy, resulting from years of honing these skills.

It’s the same with crushing it with money.

Start with the fundamentals: build a solid system to manage your day-to-day cash flow, learn some investment basics and smash any ‘bad’ debts.

By building solid financial habits, setting incremental goals, and hitting them, you’ll accumulate a toolkit of skills and habits to propel you forward.

Remember, seeking perfection from the get-go can be paralyzing. Start where you are, and improve as you learn.

Trap 2: The creep

Here’s a golden nugget of wisdom from one of my mentors: “If you can’t manage $100, you won’t manage $1 million.”

Falling victim to lifestyle creep is a one-way ticket to remaining a HENRY.

As your salary climbs, so might your taste for the finer things – like swapping that perfectly fine $20 vino for a $150 label.

But is the leap in price genuinely worth it?

Something to mull over…

Trap 3: Flying blind

Building a house doesn’t start with the details like choosing the carpets or installing toilets. It starts with an overarching plan, a bird’s eye view before you zoom in on the specifics.

It’s the same with getting ahead with money.

I’ve seen HENRYs dabble in stocks, dump some funds in savings, flirt with the idea of an investment property, and put a little extra into super.

But why?

Is it because Jim from accounting won’t stop raving about his latest stock pick, because Aunty Vera dropped her two cents, or some media pundit sounded convincing?

It’s like throwing darts blindfolded — sometimes you hit the board, but you’re relying mostly on luck, not skill.

This scattergun approach, or ‘Spraying & Praying,’ isn’t going to cut it.

Let’s face it, if you’re a HENRY, you’re probably spinning a lot of plates — work’s crazy, home life’s buzzing and those big life dreams aren’t going to chase themselves.

Who’s got the time to sit down and get all your money ducks in a row? So, yes, sometimes the cash decisions get a little… let’s say, haphazard.

But breaking it down into manageable, actionable steps can help you make progress (paying off a credit card, saving for an emergency fund, or a holiday).

And yes, while I may be biased, enlisting professional help – a top-notch accountant, a sharp mortgage broker, or a skilled financial adviser – can save you a lot of time, hassle and head space.

Your Next Steps

You can leave the ‘High Earner, Not Rich Yet’ badge behind.

Re-evaluate your approach to money, curb unnecessary expenses, and redirect your savings into building up good assets.

And get the right pit crew around you to keep you focused and accountable.

Cheering you on!

 Certified Financial Planner®, Director

Download our Money Flow Playbook

Click here to download a copy of our Money Playbook and Dashboard.

Book a free phone chat

Click here to book a free phone chat to talk about your specific situation.
Financial Advisor Geelong.


This is general advice only. Your personal objectives, needs or financial situation have not been considered when preparing this information.

You should consider the appropriateness of any general advice we have given you and, if necessary, seek advice before acting on it.

It’s always recommended to consult with a qualified tax professional to maximise your tax position.

Liked this article? Share it!