Are you in the middle class, 2023?

[LuvOrlando]

It is a good point that comparing yourself to others in your area can make you feel a certain way. I mean, comparatively, we seem dirt poor. I see high end luxury cars driving around my city all day long. My neighborhood streets are lined with McLarens, Lamborghinis, Ferraris, Bentleys...all manner of luxury cars. It's insane. But maybe those people are leasing those cars and living massive debt ridden lives? Or maybe they just make really good money? Sure seems like a LOT of people around here have a LOT of money, when most houses sell for all cash in the $2M range. Certainly it's a well off area.

We drive 16 and 7 year old Hondas. We rent because we can't afford to buy here at current rates and haven't managed to scape together $250,000 for a down payment yet. We have NO consumer debt. Our kids play no sports. We have no gym membership. We eat at moderate priced restaurants when we go out. We have Disneyland Annual passes, and that is literally our only entertainment splurge. We haven't taken a major family vacation since 2018. But yet, we make over the upper middle-class threshold for our city. I suppose if we had been able to purchase a home 10 years ago when they were less than half the price they are now, we'd be in much better shape, and we would actually be able to feel like we are an upper class household, but right now? No way. It seems like homeownership is a joke for us. Like, it will NEVER be a possibility. Every time we get close, the prices jack way up or now we have the situation with the interest rates. It's perpetually out of reach for us, no matter how much more money we make or how much we save up. The irony is, if rates were still below 3%, we'd be able to FINALLY buy a house this year. But nope. It's discouraging, and makes you feel like there is no way up the ladder.

I remember reading somewhere that the whole notion of home ownership & middle class was part of some kind of giant national marketing campaign shortly after WW2. It included a new ideology about homes, cars and family. The reason I noticed it when I came across the info was because my Grandmother told me all about it, because she lived it. She was of the generation who made it through the hardships of the Depression and WW2 where everyone gave up so much and when they started to move forward this ideal state of things became a fixture in national consciousness as a driving force. Middle Class with a house, a car etc was presented as sort of a prize earned by dutiful behavior when called upon, so it's sort of a fictional thing that became entrenched as a model.

Lots of city people live entire lives without ever owning the roof over their heads so I don't get the preoccupation with ownership. Truthfully, very few people ever actually own their homes. What we do is go into a co-ownership with a bank. We all saw how kind they were as co-owners in 08, soooo it's a bit iffy.

 

[WEDcryoHEAD]

Stuck in the middle with you.

 

[LuvOrlando]

I agree. To compound it, most people and media when they talk "middle class" they inflate the other way. People with dual incomes each making $100k+ media defines as middle class.

So, which definition of middle class is it? The defining word to me is "middle" of which median income and a range on either side of that median is the middle and what middle class should be. Most talk in discussions of middle class is more in the say 60-80% range, which is not middle.

Then there's the what income? I am pretty decently below the median income for the state. But I work a ton of overtime which puts me decently above median income. And that's my individual income comparing against the household income with includes anything from a single person through parents with 15 kids.

One would think that someone decently above the median income could afford a place to live. Well, I do. It's a piece of junk trailer on faceless corporate owned grounds that I am not allowed to do the things I do in my life. I wouldn't even be able to rent an apartment today.

"Middle class" discussions drive me a bit batty because of everyone's individual definition of "middle class."

Now you are where my head is, middle is a moving target based on the trappings of life, not numbers.

 

[mrodgers]

It is a good point that comparing yourself to others in your area can make you feel a certain way. I mean, comparatively, we seem dirt poor. I see high end luxury cars driving around my city all day long. My neighborhood streets are lined with McLarens, Lamborghinis, Ferraris, Bentleys...all manner of luxury cars. It's insane. But maybe those people are leasing those cars and living massive debt ridden lives? Or maybe they just make really good money? Sure seems like a LOT of people around here have a LOT of money, when most houses sell for all cash in the $2M range. Certainly it's a well off area.

We drive 16 and 7 year old Hondas. We rent because we can't afford to buy here at current rates and haven't managed to scape together $250,000 for a down payment yet. We have NO consumer debt. Our kids play no sports. We have no gym membership. We eat at moderate priced restaurants when we go out. We have Disneyland Annual passes, and that is literally our only entertainment splurge. We haven't taken a major family vacation since 2018. But yet, we make over the upper middle-class threshold for our city. I suppose if we had been able to purchase a home 10 years ago when they were less than half the price they are now, we'd be in much better shape, and we would actually be able to feel like we are an upper class household, but right now? No way. It seems like homeownership is a joke for us. Like, it will NEVER be a possibility. Every time we get close, the prices jack way up or now we have the situation with the interest rates. It's perpetually out of reach for us, no matter how much more money we make or how much we save up. The irony is, if rates were still below 3%, we'd be able to FINALLY buy a house this year. But nope. It's discouraging, and makes you feel like there is no way up the ladder.

And its not even just the city we live in. We couldn't afford to buy a suitable house anywhere in the REGION with the current interest rates. And those rates are preventing people from selling their homes too. So the low inventory means prices haven’t fallen at all. It's just a terrible situation all around. There is a fundamental problem when people living in area are making an "upper class" salary, yet cannot afford a home while living a modest lifestyle.

Yup, and I'm in the same boat as you (except the numbers are far different and people aren't driving around in exotic cars.)

At 50, I now need to save up what a mortgage should be which will take me 30 years to get a down payment so a house can be what a 30 year mortgage should be. I'll be 80 when I can buy a home and 110 when it's paid off. I have very little doubt with family history that I will reach 80.

So, I gave up on the thought and swapped out my basic only good for going back and forth to work for a nice car that I can take my kids places in and haul my bicycle around in.

 

[DLgal]

I remember reading somewhere that the whole notion of home ownership & middle class was part of some kind of giant national marketing campaign shortly after WW2. It included a new ideology about homes, cars and family. The reason I noticed it when I came across the info was because my Grandmother told me all about it, because she lived it. She was of the generation who made it through the hardships of the Depression and WW2 where everyone gave up so much and when they started to move forward this ideal state of things became a fixture in national consciousness as a driving force. Middle Class with a house, a car etc was presented as sort of a prize earned by dutiful behavior when called upon, so it's sort of a fictional thing that became entrenched as a model.

Lots of city people live entire lives without ever owning the roof over their heads so I don't get the preoccupation with ownership. Truthfully, very few people ever actually own their homes. What we do is go into a co-ownership with a bank. We all saw how kind they were as co-owners in 08, soooo it's a bit iffy.

Very true. I say "city" when I talk about where I live, because it is one, based on population. But it's 100% suburban sprawl.

I wouldn't mind renting forever, if not for the uncertainty about cost. This is where homeownership provides a benefit. The cost of a mortgage is fixed.

 

[DLgal]

Yup, and I'm in the same boat as you (except the numbers are far different and people aren't driving around in exotic cars.)

At 50, I now need to save up what a mortgage should be which will take me 30 years to get a down payment so a house can be what a 30 year mortgage should be. I'll be 80 when I can buy a home and 110 when it's paid off. I have very little doubt with family history that I will reach 80.

So, I gave up on the thought and swapped out my basic only good for going back and forth to work for a nice car that I can take my kids places in and haul my bicycle around in.

Yup. The rent vs buy calculator for this area says the breakeven when owning is cheaper than renting is....30 YEARS. So, I'll be 75 and FINALLY would be getting ahead as a homeowner at that point? Absurd.

I told my husband "We could just resign ourselves to renting forever and forget about saving for a down payment and go out and buy a Lamborghini too." At least we'd have fun driving to Target to grocery shop.

 

[LuvOrlando]

Very true. I say "city" when I talk about where I live, because it is one, based on population. But it's 100% suburban sprawl.

I wouldn't mind renting forever, if not for the uncertainty about cost. This is where homeownership provides a benefit. The cost of a mortgage is fixed.

This is true but on the other hand, if a bad neighbor moves in, crime starts to trend up or if, say, a train derails in your neighborhood spewing fumes all over the place guess whose problem it ain't? A renter has the luxury of declaring, "I'm out," and just leaving the mess all behind and renting elsewhere. We have owned and we have rented, renting is far less costly and has many benefits in many ways IMO.

 

[mom2rtk]

"Middle class" discussions drive me a bit batty because of everyone's individual definition of "middle class."

Everyone on the DIS is middle class. Nobody ever wants to cop to being wealthy. There was a thread here a few years back "Are you wealthy". It was a fun read. Also loved the "what is a big house" thread. Everyone thinks they are average and it takes more money (and square footage) to be wealthy or above average.

 

[DLgal]

Everyone on the DIS is middle class. Nobody ever wants to cop to being wealthy. There was a thread here a few years back "Are you wealthy". It was a fun read. Also loved the "what is a big house" thread. Everyone thinks they are average and it takes more money (and square footage) to be wealthy or above average.

So true. When I came across the article the other day, I sent it to my husband with the caption "Congratulations! We've made it to the upper class."

His reply: "Cool, but I don't even know what that means."

It really doesn't mean anything. The articles that talk about how much it takes to be wealthy all have various net worth numbers anywhere from starting at $1M to $5M. To me, there is certainty a massive difference between those 2, even. No one can agree. It's all relative.

 

[tzolkin]

Truthfully, very few people ever actually own their homes. What we do is go into a co-ownership with a bank.

This is definitely true and also factors into my earlier post about "keeping up with the Joneses" as being many people's definition of middle class. Around here, it is the norm to continue purchasing a larger/more expensive home every few years as your income allows. So even after 30 years of making mortgage payments, most still do not "own" their homes. They have just traded their previous house for another mortgage on a larger one.

This is also why criteria for what constitutes "middle class" is hard to agree on and often may have nothing to do with one's lifestyle or wealth. A specific salary number does not automatically equate to any certain lifestyle, home ownership, etc. My co-workers all earn three to six times my salary. They have the appearance of a more upper-middle class lifestyle, but I have more savings/investments and certainly more financial freedom. If our company closed tomorrow, I would not be concerned about how to pay my bills but the majority of them would struggle.

 

[RamblingMad]

No.

What did I miss? Disney raising their prices faster than wage growth for decades clearly makes the parks for the upper class and those willing to save and make sacrifices. It’s not as affordable as it once was in the 80s and 90s. And the population has grown a lot. Disney really needs another gate.

 

[GAN]

So true. When I came across the article the other day, I sent it to my husband with the caption "Congratulations! We've made it to the upper class."

His reply: "Cool, but I don't even know what that means."

It really doesn't mean anything. The articles that talk about how much it takes to be wealthy all have various net worth numbers anywhere from starting at $1M to $5M. To me, there is certainty a massive difference between those 2, even. No one can agree. It's all relative.

I was wondering myself how I should feel being in the Lower Class of the Upper Class?

 

[rangerxenos]

Technically-in between median and upper middle limits…but it sure doesn’t feel like it sometimes in CT lol

I'm also in CT, and in the same spot as you; it costs a LOT more to live here than in most other places in the country!

 

[FlightlessDuck]

According to https://www.pewresearch.org/, I'm in the upper 20% income for my area. Now if only I were better with my money...

https://www.pewresearch.org/fact-tank/2020/07/23/are-you-in-the-american-middle-class/

 

[RamblingMad]

According to https://www.pewresearch.org/, I'm in the upper 20% income for my area. Now if only I were better with my money...

https://www.pewresearch.org/fact-tank/2020/07/23/are-you-in-the-american-middle-class/

Check out Bogleheads.

 

[Living42Day]

Same for military. Teachers salaries, by name, are also available to anyone who wants to know.

I never understood the secrecy around income. Who cares? It SHOULD be more widely discussed. Otherwise, people get taken advantage of and paid unfairly.

Don't work for the government then. Anyone can look up my exact salary & benefits.

It's less about secrecy and more about security. I would argue that advertising how much you make vs someone seeking it out themselves is different. I follow the rule of two pieces of information that should never be loosely shared: the amount of money that you have and whether you are armed.

 

[DCLMP]

I agree. But this is how the "middle class" has always been defined. It's a function of the cost of living, overall, for a specific area. It means "this is enough to get by." Middle class means you aren't living in poverty or with excess. You make too much for government welfare programs but too little to be truly thriving in most places.

Those charts seem accurate. I think majority of the posters on here are upper middle class or above middle class. I think people lose sight of the fact that most middle class families don’t take 10k + Disney vacations.
Even though we’re above middle class according to those numbers I consider myself middle class, but in reality we are probably better off than most.

I don’t discuss personal finances with friends and co-workers, but I don’t think the money people on this forum spend traveling is the norm.

 

[DCLMP]

No.

What did I miss? Disney raising their prices faster than wage growth for decades clearly makes the parks for the upper class and those willing to save and make sacrifices. It’s not as affordable as it once was in the 80s and 90s. And the population has grown a lot. Disney really needs another gate.

People bring up how crowded Disney is as a reflection of the economy. I think it has more to do with the population in Florida exploding over the last few years. I’d be surprised if they ever bring back out of state annual passes.

 

[DCLMP]

Everyone on the DIS is middle class. Nobody ever wants to cop to being wealthy. There was a thread here a few years back "Are you wealthy". It was a fun read. Also loved the "what is a big house" thread. Everyone thinks they are average and it takes more money (and square footage) to be wealthy or above average.

So the people booking 30k concierge rooms on DCL are middle class lol. I’m really doing something wrong. Maybe if I give up a few more lattes I can afford it.

 

[RamblingMad]

People bring up how crowded Disney is as a reflection of the economy. I think it has more to do with the population in Florida exploding over the last few years. I’d be surprised if they ever bring back out of state annual passes.

The increased crowds should be do to a much larger population. It’s not like the parks have gotten bigger.

In 1990 the US had a population of 250m. In 2022 the US had a population of 333m. That’s almost an additional 100m people.