Get expert advice on every topic you need as a small business owner, from the ideation stage to your eventual exit. Our articles, quick tips, infographics and how-to guides can offer entrepreneurs the most up-to-date information they need to flourish.

Subscribe to our blog

Is It Possible That You’re a H.E.N.R.Y? (High Earners, Not Rich Yet)

Posted by Arya Chatterjee

January 25, 2024

A new acronym has found its way into conversations in the landscape of personal finance —— H.E.N.R.Y. No, we’re not naming your next-door neighbor’s friendly labrador. We’re unraveling the concept of High Earners, Not Rich Yet. Suppose you’re making good money with your business flourishing but your bank account is still not reflecting the success. In that case, you might be a H.E.N.R.Y. Let’s dive deep and see if it resonates with your financial reality. 

The term ‘H.E.N.R.Y.’ was first coined in a 2003 Fortune article to refer to families making between $250,000 and $500,000 annually. As standards evolved and classifications shifted, today’s workers could earn between $100,000 and $250,000 annually. Essentially, a High Earner, Not Rich Yet (H.E.N.R.Y.) finds themselves in the curious position of earning a substantial income but has yet to translate that into lasting wealth. 

Business owners showcasing a peculiar phenomenon where income doesn’t necessarily equate to financial freedom also fall under the H.E.N.R.Y. category. These individuals are stretched thin between high earnings and substantial financial obligations, teetering on the edge of prosperity.

Signs you might be a H.E.N.R.Y. as a business owner


1. High revenue, limited profits

Your business is generating significant revenue, but the profits reflect a different level of success. This could be due to high operating costs, heavy reinvestment in the business, or debt servicing.

2. Reinvestment over personal wealth accumulation

You’re constantly reinvesting in your business instead of channeling profits into your savings account. While reinvestment is crucial for self-sustained growth, a H.E.N.R.Y. small business owner can find it challenging to divert funds towards personal wealth with demanding business needs.

3. Personal finances tied to business performance

Your finances are directly tied to your business performance. So, fluctuations in the business can impact your financial stability. Due to income volatility that comes with small business budgeting, a H.E.N.R.Y. can lose out on personal financial security.

Talk to us about how Escalon’s FinOps can help you gain financial insights to make informed decisions.


4. Delayed entry into investments

Despite being a successful business owner, you have yet to enter the real estate market or make significant investments outside your business. While the focus should be on business growth, personal investment diversification can help you hold up financial commitments in both realms.

5. High personal debt levels

Your personal debt levels, such as student loans, credit card debt, or housing loans, are higher than expected, given the success of your business. The financial demands of a growing business paired with personal loans can lead to higher debt levels.

6. Focusing on business prestige

You prioritize the prestige and growth of your business over personal financial security. Of course, your business should be successful and gain the desired recognition. Still, it would help if you avoided financial goal-setting to limit your wealth-building strategies.

7. Lifestyle creep

If you’ve noticed your lifestyle upgrading with your prospering income, you might fall prey to lifestyle creep. You are absorbed in elevated living expectations rather than directing your income towards savings or investments.

8. Limited emergency fund

Despite having a successful business, you may fall short of building a robust personal emergency fund. The unpredictable nature of the company may lead small business owners to prioritize cash flow within the business over personal emergency savings.

Breaking free from the H.E.N.R.Y. mold

Now that we’ve laid bare the H.E.N.R.Y. reality, how can you break free from this mold as a small business owner? It starts with finance process improvement and recognizing the advantages of retaining control over your money.

1. Budgeting wisdom

Implementing small business budgeting is critical for self-sustained growth. Track your expenses for finance process improvement. Identify areas where you can cut back and consciously allocate funds towards savings and investments.

2. Emergency fund essentials

A robust emergency fund is your financial safety net. It would help if you collected at least six months’ living expenses. This will give you the peace of mind required to run a business without worrying about cash.

3. Invest wisely

Diversify your investments beyond your business. Extend your investment portfolio towards stocks, real estate, or retirement accounts. Educate yourself on personal finance to pave the way for lasting wealth.

Wrapping up

Being a H.E.N.R.Y. isn’t a life sentence; it’s a phase that can be easily transcended with conscious financial management. If you have too much on your plate, consider hiring financial services for small business owners.

The journey to true wealth isn’t about earning big but making every dollar count. Finding the right small business financial solutions can pave the path to lasting financial freedom. Get ready to make your bank account a sight to see because, from now on, it’s all about thriving, not just surviving!

Schedule a call today

Want to know more about startups and what it takes to get started? Since 2006, Escalon has helped thousands of startups get off the ground with our back-office solutions for accounting, bookkeeping, taxes, HR, payroll, insurance, and recruiting — and we can help yours, too. Talk to an expert today.


Arya Chatterjee
Arya Chatterjee

Arya Chatterjee is a freelance writer and consultant from Mumbai. With a background in journalism and over five years of creative writing experience working with legacy media like Architectural Digest and Femina India and brands like The Label Life, and Macy's, she crafts unique and compelling stories that engage the readers. She enjoys writing about health, beauty, fashion, and lifestyle and exploring the symbiotic relationship between thriving businesses and happy employees through her writing. She is always looking to explore new avenues to expand her creative energy.

We provide you with essential business services so you can focus on growth.