What really is the Middle Class Income?

I was reading the tax reform and it seem that those in Washington cant decided on what is middle class income or what can be considered middle class, I figured that most us on ATS can figure this one out for them.

Going of off myself, family of 4, We were struggling to make ends meet making just over $30K a year,(did not qualify for any help) but we managed, kids got old enough and wife went back to work,(it was cheaper for her to stay home instead of day care), with two incomes we were able to finally purchase a new vehicle, our 1991 was put to rest in 2012, vacations were going to grandma and grandpas or another relative.

But several years later, both kids graduated, one working full time and one we are helping put through college, he is doing his core classes locally to save on cost.

Last year we made just about 73K between the two of us and I can finally say we have more than two nickels to rub together at the end of the day, and actually have some money put away for emergencies, we are better of than we were but still watch what we are spending.

Looking around and seeing them discuss what is middle class, I think I fit the profile, we don't make over 100K per year don't have a 3000sq ft home and all the seasonal toys or take expensive vacations.

So I think if you make over 125k per year (dual income) your not middle class

a reply to: 19KTankCommander


It also depends on where you reside. $125,000 a year for two people in north Jersey isn't exactly wealthy with the cost of living and the property taxes we pay.

a reply to: 19KTankCommander

30k would be working class.

A carpenter making 20 an hour makes more than 30k a year.

The average income in the us is about 50k.

125k is not very much money and would not allow for lots of extras with a family of 4.

The location would be very important.

75k in many place for a family of 6 would be very difficult to stay afloat. Some places for instance you aren't getting rent for under 2k. 24k a year for rent alone.

a reply to: 19KTankCommander

I think a better measure would be what you have as a result of your labours in terms of the quality of your accommodations, the quality of the car you drive, the ease with which you can afford groceries, luxuries and the like.

Basing it purely on what number of dollars you get does not tell the whole story, because cost of living is not static, but depends on region.

a reply to: TrueBrit

But then taking into consideration the amount of DEBT that one has could lower their quality of life. Consumption doesn't take into consideration those that purposefully try to lower their consumption.

So, I think that there is not one measure of middle class. Income doesn't take into consideration the millions who are retired. In that case, wealth is a better indicator.

One classic definition (John Cleese is involved);
www.youtube.com...

a reply to: Iamonlyhuman

Yes, perhaps.

But there needs to be a table or an algorithm developed, which automatically adjusts for region, so that two people who live in unlike cost of living circumstances, can be correctly compared and categorised. Wealth is not a solid indicator on its own.

Open Pit Mine & processing electrician wife operate our Small Tourist Lodge and breaking even most year
130K to 140K a year Northern Ontario Canada

Think I am middle of middle class

150k to 175 would be upper-middle class

a reply to: 19KTankCommander

Middle class used to mean, work a 40 hour week, career employment, benefits, retirement with pension, savings, equity, family, cars, house, paid vacations, healthcare covered by employer for the whole family.

Didn't matter if you were a dock worker, engineer or doctor. Unions protected the middle class.

My dad afforded all that; two kids, family home, paid vacations to disneyland, on less than two grand a month.

How much does that cost in todays market?

Great post. I have a lot of respect for stories like yours (at least on paper). I wish your kids luck, and I hope you find some extra cash, or business opportunities to help support yourselves- even though you are finally doing better than ever.

a reply to: intrptr

Everything has been downsized and out-sourced. Jobs, economy, politics, freedom.

ETA I remember my parents surviving with one wage. Back in the day that was possible. Not any more.

originally posted by: LightSpeedDriver
a reply to: intrptr

Everything has been downsized and out-sourced. Jobs, economy, politics, freedom.

Including the value of a dollar. We call that inflation, fiat currency, in print, instead of gold backed we have paper backs.

a reply to: 19KTankCommander

The real middle class income is 'knowledge by way of education'. By no means am I trying to insult anyone's intelligence... it's really an insult to the public education. All public schools should teach kids to save $5 a day, invest it in stable portfolio gains within the stock exchange, set and obtain financial goals, and learn money management before it becomes of the utmost importance of how a growing family learns finances.

The power of compounding interest is not taught to the public, therefore its up to the public to take the reigns of who these important information reaches and affects in our family futures. Simply put, saving $5 a day at age 18 can yield an easy $1 million dollars come retirement age... in a low risk option that is. Please, get your kids on this plan now, as it does way more than just set a good financial foundation for growing minds!!! Switching finances to work with the future in mind also opens up the channels of how finances are handled... moving beyond a month to month platform, while keeping decisions steadier as the long term goals are worked towards. It also yields the benefits of making one more likely to create a family with another that thinks/operates in the same financial ways.

Once people switch their mindsets from 'spending to save money' to 'saving to spend money later', we will see the separation of wealth gaps lessen. I say poor, because there is no more middle class... the separation of wealth is only growing and trending to continue on this path. Don't try to keep up with the Jones'... just make your family the Jones'!!!

www.mybudget360.com...

The 1% taking 20% of all American income is not by chance... it's by design. There is one thing I promise of these 1%ers... that is that 1%ers aren't taking the full 20% through a 9-5 job. Nope, the bulk of the financial gains come from what one does with their earnings to make financial gains. If one decides to take income from a 9-5 job only... then one will choosingly die a working man. The 1% make money while they sleep... on top of their fat incomes.

Best wishes to financial education and wealth gain for all!!!

a reply to: intrptr

At least some of them have the latest iPhone to distract them.

originally posted by: LightSpeedDriver
a reply to: intrptr

At least some of them have the latest iPhone to distract them.

Lol, as kids we had this...

I can say we were flat broke at 140k joint. Sounds stupid doesn't it. But! When you factor in we had to live off of my income while my wife was in school, with kids, she was collecting school debt. So instead of an income for those few years and collecting debt we had 0 savings and big loans to repay. With high interest loans that NEVER end, everything we were making went to repaying debt with no end in sight. A few medical bills pile up, insurance went up (thanks a lot Obama lol), taxes and more taxes! The people living off the government seemed to have a better life than us at 140k!!!! And they have a lot less stress. I go in their houses and see how they live! Some have giant TVs and brand new IPhones, their kids have gold teeth caps, and they ride an ambulance to the hospital for a headache because they get free meds, even if it's just Tylenol. Its infuriating!!!
But, luckily our parents helped stop the bleeding so we are very lucky in that way. You should be very proud of making it out on your own. I truely admire that.

a reply to: 19KTankCommander

I guess we fully understand that there are a lot of variables involved here, but once again what should (dollar amount) be set for middle class, this is the problem they are seeking answers to.

The politicians in DC don't care about what debt we may have from home, school, medical ect, they want to set a dollar amount for tax reasons, I do agree that sure you may make $20 dollars an hour but at the end of the day you don't have anything left because of said reasons, and to make it worst they base everything of off Gross income instead of net, there is a big difference.

So again what really is the middle class 30-125K or 30- 220k (joint of course)

a reply to: 19KTankCommander

It's all about choices.

Cooking at home and brown bagging a lunch (saves HUGE $$$).

Not buying cups coffee outside of the house (saves HUGE $$).

Not paying for a cell phone over $25 a month.

Staying home on the weekends.

I know, I know. But if you want to live on what the corps are paying and ever be out of debt, this is the only way.

30-50k is lower middle /50-80K is middle income in the mid west.


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originally posted by: TrueBrit
a reply to: Iamonlyhuman

Yes, perhaps.

But there needs to be a table or an algorithm developed, which automatically adjusts for region, so that two people who live in unlike cost of living circumstances, can be correctly compared and categorised. Wealth is not a solid indicator on its own.

The tricky thing is that utilities are priced completely differently in countries. In Norway and Canada, electricity is really cheap due to hydroelectric power. Utility bills (electricity) were £60/quarter, as hot water service for apartment blocks is communal. The down-side being that if you are late up, there isn't any hot water left.

However, in Norway, mobile phone was really expensive, you had to pay two bills; one for the network and the other for the mobile phone service provider. Those added up to £300/quarter. Food was super-expensive as they have to import everything. Around £100/week per-person. In the UK, food is around £50/week per person.
California and Canada were around $35/person.

With computer technology, prices are simply converted from dollars into pounds. What costs $600 in the USA will cost £600 in the UK due to import duty. The same happens in other countries.

Rents and mortgages can be compared by measuring how much it costs per square foot/meter for different types of property; apartments. houses, condo units. Somewhere like San Francisco, Menlo Park start at $5000/month.

The UK has ACORN demographics which place everyone into about 30+ economic groups; then they can identify each post-code with a particular economic earning power.

a reply to: 19KTankCommander

I started out making very little, but I was young, had 2 roommates and all I needed outside of the basics was a car.

After college I set my sights higher, and had to have all the things I was led to believe would bring me happiness. The most I made in my life was $160,000.00 a year. I walked away from that job because it required the purchase of my soul.

I went through the phase were I could make all the money I needed by increasing my work hours to 24/7. How I did it for so long is a testament to the power of child rearing and love of family.

I am now in what some call my golden years, and I make the least amount of money I have ever made in my life, yet I am the happiest and the most content.

I have learned over the years that it is not what you make, it is what you spend.