Money Guy Show: Why Even High-Income Earners Still Feel Broke

Hosted by Brian Preston and Bo Hanson | Release Date: August 8, 2025

Introduction

In the latest episode of the Money Guy Show titled “Why Even High-Income Earners Still Feel Broke,” hosts Brian Preston and Bo Hanson delve into a perplexing phenomenon: despite earning substantial incomes, many individuals still struggle to build wealth and achieve financial well-being. This episode unpacks the underlying reasons behind this disconnect and offers actionable strategies to bridge the gap between high earnings and lasting financial security.

The Disconnect Between High Income and Financial Well-being

Brian and Bo kick off the discussion by highlighting a common misconception: higher income inherently leads to greater financial security and happiness. Contrary to popular belief, studies reveal a significant portion of high earners are far from financially secure. For instance, Bo cites a USA Today report stating that "20% of households with over $150,000 in income are living paycheck to paycheck" [02:40]. Additionally, 29% of these households can only save $1,000, and a staggering 6% have nothing saved at all [02:40]. These statistics underscore the reality that income alone doesn't guarantee financial stability or fulfillment.

Problem #1: High Income Doesn’t Fulfill Expectations

One of the primary issues discussed is the mismatch between high income and the anticipated sense of financial well-being. Brian references Morgan Housel's insight: "When most people say they want to be a millionaire, what they might actually mean is I'd like to spend a million dollars. And that is literally the opposite of being a millionaire" [04:21]. This consumption-driven mindset leads high earners to prioritize spending over saving, resulting in diminished financial growth despite their substantial incomes.

Problem #2: Lack of Discipline in Saving and Investing

Discipline emerges as a critical factor separating those who build wealth from those who don't. Brian emphasizes, "If you can tell me what you make and then what you save, I can tell you very quickly, is discipline being acknowledged, is it being respected?" [07:32]. The hosts advocate for a disciplined approach to saving, recommending that individuals aim to save 25% of their gross income regardless of their earnings level [08:07]. This target is grounded in their analysis of financial behaviors and the understanding that consistent saving is essential for wealth accumulation.

Problem #3: Lifestyle Creep

As incomes increase, so too does the tendency to elevate one’s lifestyle, often outpacing income growth. Bo explains, "What ends up happening is while in the beginning of our journey we may have been living below our means... what happens is as our income increases... we try even harder to keep up with the Joneses" [11:29]. This phenomenon, known as lifestyle creep, leads to living beyond one's means, making it difficult to save and invest adequately. To combat this, Brian and Bo introduce the 60/40 rule: allocating 60% of any additional income towards savings and 40% to lifestyle enhancements [13:47].

Problem #4: Ignoring Risk Capacity

High-income earners often feel compelled to engage in more complex and riskier investments as their net worth grows. Brian warns, "Complexity does not necessarily mean better" [16:15]. This drive for sophisticated investment strategies can divert funds from simple, effective avenues like low-cost index funds and diversified portfolios. The hosts stress the importance of maintaining simplicity in investment approaches to ensure steady and reliable growth.

Problem #5: Procrastination and Assuming Time is on Their Side

A pervasive issue among high earners is the belief that they have ample time to build their wealth later, leading to procrastination in saving and investing. Bo highlights the dangers of this mindset: "The earlier you figure this out, the more impactful it can be... if you wait until you're 30, that $1 turns into 23" [26:16]. The concept of the wealth multiplier underscores the exponential benefits of starting early, illustrating how delaying savings can significantly reduce financial growth over time.

Solutions and Recommendations

To address these challenges, Brian and Bo propose a multi-faceted approach:

1. Shift Mindset: View money as a tool for achieving life goals rather than an end in itself [05:49].
2. Increase Savings Rate: Aim to save 25% of gross income, adjusting upwards as income grows [08:07].
3. Adopt the 60/40 Rule: Allocate 60% of raises and bonuses to savings and 40% to lifestyle [13:47].
4. Simplify Investments: Focus on low-cost index funds and diversified portfolios, avoiding unnecessary complexity [19:20].
5. Start Early: Leverage the power of compound interest by beginning to save and invest as soon as possible [26:16].

Additionally, they emphasize the importance of active financial management—not just tracking expenses but using that information to make informed financial decisions [14:34].

Conclusion and Call to Action

The episode concludes with a strong encouragement for listeners to take proactive steps towards financial discipline and simplicity. Brian and Bo invite those feeling overwhelmed by complexity or uncertain about their financial strategies to utilize the free resources available on their website, moneyguy.com/resources. For more personalized guidance, they offer professional advisory services through Abound Wealth Management, ensuring that high-income earners and those aspiring to higher earnings can navigate their financial journeys confidently and effectively.

Notable Quote:

“Money is nothing more than an amplifier of who you already are. So this year, this day, this week, I'm either going to be a saver or I'm going to be a spender.” — Bo Hanson [23:08]

By addressing behavioral patterns and promoting disciplined financial practices, Brian and Bo provide valuable insights for high-income earners seeking genuine financial well-being and long-term wealth accumulation.