Research says the average worker is richer than ever. Every other American struggling to get through the month sane would say yeah right.
A new study by MyPerfectResume found that Americans are technically earning more money than ever, a fun fact that stops being fun the moment you try to pay rent.
Why Do Paychecks Feel Smaller?
According to the January 2026 study, average annual pay climbed from about $64,000 in 2020 to $75,600 in 2024 — an 18% increase in raw dollars.
Yippee. Pop the celebratory Champagne.
Except maybe don’t.
The same study found consumer prices rose roughly 21% over that period, meaning a dollar today buys what about 82 cents did in 2020. So yeah, better put the bubbly back in the fridge.
After adjusting for inflation and cost of living, the study found the typical worker is effectively earning 2.6% less than they were four years ago.
For millions of workers, bigger paychecks didn’t translate into better living standards—just higher bills.
According to the study, the biggest pressure points came from core cost-of-living categories: housing, groceries, energy, insurance, and other everyday essentials.
Does Where You Live Make It Worse?
The affordability gap varies widely across the country. The study found that real wage gains were limited to a small number of states, including Idaho and Florida, where earnings managed to outpace rising costs.
In most places, however, higher pay was offset by local expenses — particularly housing — with states such as New Jersey, Rhode Island, and Maryland seeing some of the steepest losses in purchasing power.
What Does This Look Like in Real Life?
The lived version of the study is evident online. In a Reddit thread, one user says they make more than double what their parents made, and their household income is roughly four times what they grew up with.
“My parents bought their home in the 70s, paid it off early, and still had room in their budget for snowmobiles, ATVs, boats, new pickup trucks, etc. Today, they own their primary home still, as well as a second vacation home on acreage. They also just bought a side-by-side and a brand new pickup truck this year,” the Reddit user wrote.
They continued, “We do have a home, we are lucky to have bought our first in 2012. However, we drive old vehicles, stay home, cook all our meals at home, etc. just to be able to afford one vacation per year. Our health insurance and expenses for a family of 4 is off the charts. My daughter broke a bone this year, resulting in more than $2,000 in out-of-pocket bills, even well after we met the deductible.”
An alarming number of people found the post uncomfortably relatable, with many saying they are in a similar situation.
“Wait, am I poor?? Lol. This is me,” one user wrote.
“If I made what I do now 15 years ago, I’d have it made. In 2025 I’m barely making it,” said another.
The economy may look stable from 30,000 feet, but on the ground, paychecks are stretching thinner, not further.
More From Cheapism
- The Average American Worker Has $955 Saved for Retirement. That’s Not a Typo — If you’re imagining the “average” American worker has a modest but respectable retirement cushion tucked away somewhere, you’re sorely mistaken.
- ‘Our Electric Bill Is Eating Us Alive’: Electricity Bills Are Rising, No Matter How Much We Try to Save — According to Consumer Price Index data, electricity prices rose just over 5% between September 2024 and September 2025, which is higher than the overall 3% inflation rate.
- New Medicaid, SNAP Work Requirements May Delay Retirement for Older Workers — Experts say new requirement could force some older workers to stay on the job longer than planned just to keep health coverage or food assistance.
