Oh Henry!

This is the age of acronyms.  While the use of labels such as Baby Boomers still survives as a relic of a simpler past, snappy little contrivances have come to dominate in this age of key stroke ecology.  The label “Hippy” was replaced by the acronym “Yippie” as an endless parade of such abbreviations entered our financial/social lexicon.  Dinks (Double Income, No Kids) for instance took hold some time back, only to be replaced by Ninja (No Income, No Job, no Assets) just recently.  Signs of the times.

Today we learn of a new one: HENRY.  This has nothing to do with what may be your favorite confection; rather, it stands for High Earner, Not Rich Yet.  Acronyms generally are created to describe an influential societal phenomenon –except for anything related to space exploration where tortured examples are born to describe something generally unintelligible anyway.  HENRY is no exception.

The group of Americans captured within this cohort is defined as folks earning between $100,000 to $250,000 annually.  Economic demographers assert there are 21 million such households today, accounting for 90% of our nation’s affluent consumers.  This group, in turn, is defined as the top 20% in income which makes up 40% of consumer spending.  It does not include, by the way, the top 2% of earners who comprise that elite group labeled ultra-affluents.  They don’t need an acronym.  They know who they are.

What’s the point?  The Henry’s are quite susceptible to economic conditions.  When they feel things around them are getting tight, they react by restricting their spending, increasing savings, contracting back into their nests as a feeling of unease, that the good times may not last much longer, grows more pervasive.  They intuit a need to defer to caution when considering discretionary spending.  When enough of them begin restricting their spending, the ripples spread throughout our economy to its detriment.  If you are one of this select group, don’t let this happen.  Go ahead.  Splurge.  That candy bar has your name written all over it.