Hi, I was having this issue too. I'm on a laptop with a 128GB SSD and a 1TB HDD.
I wanted to comment in case anyone else found this in a google search like I did.
In my case it was a folder permissions issue. I'm on Windows 10 1909 for reference.
Windows had already created a "Program Files" folder on [D:] (the 1TB HDD) for windows store apps. I had created a folder called "SpotifyData" within it, which Windows prompted me for admin permission to do so. I didn't realize it at the time but that was the sign of a permissions issue.
My user didn't own the "Program Files" folder, and by creating the "SpotifyData" folder with the admin prompt, my user didn't own it either and had read only permissions.
The solution to fix permissions is to:
-Right Click on the folder, select 'Properties' from the context menu.
-Go to the 'Security' tab on the folder's properties page.
-Click the 'Edit' button underneath the first list, of users and groups.
-On the permissions dialog that pops up, Click the 'Add' button under the list of users and groups.
-On the 'Select Users and Groups' dialog that pops up, click the 'Advanced' button.
-On the new larger 'Select Users and Groups' dialog that appears, click the 'Find Now' button on the right middle.
-In the 'search results' list at the bottom, scroll through and find your Windows user name for the computer(the one used/displayed when you login to your computer.)
-Select your user name and click on the 'OK' button, that dialog should close and the previous one's textbox should be filled out with your computer name and user something like this: COMPUTERNAME\UserName
-Click 'OK' again and now your Username should appear in the list of users and groups, select it.
-With you Username selected you can now click on the 'Allow' checkbox for the list item 'Full Control' under the permissions list for your Username.
-Verify all checkboxes under the 'Allow' column are now checked, and click 'OK'
-Click 'OK' again on the folder properties dialog to finish saving the settings and now Spotify should be able to properly work with that folder.
Hope this helps someone in the future who finds this via a search or however.
I took a screenshot of all the dialogs for reference. Order is roughly left to right, though the last two are also top to bottom.