Spending power: How Henry – High Earners, Not Rich Yet – became the name to watch
These affluent – but not yet HNW – millennials are may shape the luxury sector's post-pandemic world
Henry turns 30 in 2021, give or take a few years. They have a job that reflects their high level of education – think lawyer, banker, entrepreneur – and pays somewhere between £100,000 to £500,000 per year. Henry’s downtime is full of activities: their club memberships include the likes of Soho House and high-tech gyms; they holiday several times a year. They drink artisanal coffees and craft beer and their investment decisions, when they do invest, often veer towards the socially responsible – like social equality or the environment – or the more personal, such as collecting vintage guitars or modern street art.
Henry – that is, high earners, not rich yet – is how the financial industry has long referred to individuals, often millennials, who have a decent income now and could be truly wealthy in the future. They are the younger sibling of the high net worth individual and, according to luxury trade organisation Walpole, could yet prove the biggest influence on today’s luxury market.
The term Henry was first coined in the US by Shawn Tully in a 2003 article for Fortune magazine. Tully referred to families earning around $500,000 per year but who, due to mortgages, student loans, school fees, club memberships and other financial debt, had little disposable income. The catchy acronym returned to American parlance during the 2008 presidential election, becoming a buzzword for almost-affluent millennials who could best be
described as the “working rich” – but, due to an apparent ‘work hard, play hard’ philosophy, needed to keep working to stay rich. This demographic has been defined by three key elements: a higher-than-average income, little to no savings, and a feeling of having little material wealth.
More recently, particularly as Henry has made its way into UK terminology, it has become something of a catch-all term for the future rich – and, much like the Yuppies (young urban professionals) and Dinks (dual income, no kids) of the 1980s, has become a prime target in luxury marketing.
This generation of affluent and active consumers is already primed to shop, though they are by and large a discerning bunch, seeking out brands whose values align with their own and ready to remain loyal to companies as their age and wealth increases – making them one of the most desirable clients. Additionally, as the market recovers from Covid-19 lockdowns, the larger numbers of potential consumers in the henry market (compared to HNWIs) makes up for the not- quite-as-deep pockets.
But luxury brands should take note: while Walpole predicts that Henrys will only increase their purchasing power in the next two years, their discerning attitude and continued search for authentic and sustainable storytelling may, in fact, continue to shape the very market that is fighting for their future loyalty.