Join Early Retirement Today
Reply
 
Thread Tools Search this Thread Display Modes
What is "Middle Class"?
Old 12-09-2010, 08:31 AM   #1
Thinks s/he gets paid by the post
David1961's Avatar
 
Join Date: Jul 2007
Posts: 1,076
What is "Middle Class"?

I came across this article.

Middle class falls short on retirement funds - Yahoo! Finance

One thing that caught my attention is the following:

"Middle class is defined as those aged 30 to 69 with $40,000 to $100,000 in household income or $25,000 to $100,000 in investable assets and those aged 25 to 29 with income or investable assets of $25,000 to $100,000."

So does this mean if you are between 30 and 69 and have more than $100,000 in investable assets, you are not middle class? If so, what are you? Certainly not rich!
__________________

__________________
David1961 is offline   Reply With Quote
Join the #1 Early Retirement and Financial Independence Forum Today - It's Totally Free!

Are you planning to be financially independent as early as possible so you can live life on your own terms? Discuss successful investing strategies, asset allocation models, tax strategies and other related topics in our online forum community. Our members range from young folks just starting their journey to financial independence, military retirees and even multimillionaires. No matter where you fit in you'll find that Early-Retirement.org is a great community to join. Best of all it's totally FREE!

You are currently viewing our boards as a guest so you have limited access to our community. Please take the time to register and you will gain a lot of great new features including; the ability to participate in discussions, network with our members, see fewer ads, upload photographs, create a retirement blog, send private messages and so much, much more!

Old 12-09-2010, 08:59 AM   #2
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
travelover's Avatar
 
Join Date: Mar 2007
Posts: 9,902
Just another generalized pot boiler article written to fill space .
__________________

__________________
Yes, I have achieved work / life balance.
travelover is online now   Reply With Quote
Old 12-09-2010, 09:10 AM   #3
Administrator
W2R's Avatar
 
Join Date: Jan 2007
Location: New Orleans
Posts: 38,937
Quote:
Originally Posted by David1961 View Post
I came across this article.

Middle class falls short on retirement funds - Yahoo! Finance

One thing that caught my attention is the following:

"Middle class is defined as those aged 30 to 69 with $40,000 to $100,000 in household income or $25,000 to $100,000 in investable assets and those aged 25 to 29 with income or investable assets of $25,000 to $100,000."

So does this mean if you are between 30 and 69 and have more than $100,000 in investable assets, you are not middle class? If so, what are you? Certainly not rich!
It must be a misprint. Surely they meant income of $25K-$100K from investments.

No, those with over $100K in investments are not rich! Maybe they are if their investment income is over $100K. And those who aren't working and have only $25K in investments are probably very poor, not middle class, if they have no other income.
__________________
Already we are boldly launched upon the deep; but soon we shall be lost in its unshored, harbourless immensities.

- - H. Melville, 1851
W2R is online now   Reply With Quote
Old 12-09-2010, 09:38 AM   #4
Thinks s/he gets paid by the post
powerplay's Avatar
 
Join Date: Oct 2008
Posts: 1,380
About a year or so ago I did some searching around on the net to try and find out what "middle class" meant and found no consistent definition of income or assets. The income range seemed to go from $30k to well over $200k depending on who was talking "middle class". I concluded that there is no clear criteria or agreement and the term is thrown around and means different numbers to different people.
__________________
powerplay is online now   Reply With Quote
Old 12-09-2010, 09:39 AM   #5
Thinks s/he gets paid by the post
Leonidas's Avatar
 
Join Date: May 2006
Location: Where the stars at night are big and bright
Posts: 2,847
The younger age exception I understand, but what happens when you turn 70? Are you drummed out of the middle class because you're too old?

I liked this quote:
Quote:
The vast majority of respondents admitted they need help figuring out how much money they need to live on in retirement and picking investments for their 401(k)s. But in a negative twist for financial advisers, more than two-thirds said they were not willing to pay for this advice.
This puts more responsibility on employers to offer advice and planning tools through their workplace 401(k) plans, said Nordquist.
"If people aren't willing to pay for advice they are going to get a more vanilla approach to planning," she said. "But a simple plan is better than no plan."
__________________
There is no pleasure in having nothing to do; the fun is having lots to do and not doing it. - Andrew Jackson
Leonidas is offline   Reply With Quote
Old 12-09-2010, 09:41 AM   #6
Administrator
W2R's Avatar
 
Join Date: Jan 2007
Location: New Orleans
Posts: 38,937
Quote:
Originally Posted by powerplay View Post
About a year or so ago I did some searching around on the net to try and find out what "middle class" meant and found no consistent definition of income or assets. The income range seemed to go from $30k to well over $200k depending on who was talking "middle class". I concluded that there is no clear criteria or agreement and the term is thrown around and means different numbers to different people.
You know, after reading your post and thinking about it, I think that "middle class" is more of a mindset than a specific income level or net worth.
__________________
Already we are boldly launched upon the deep; but soon we shall be lost in its unshored, harbourless immensities.

- - H. Melville, 1851
W2R is online now   Reply With Quote
Old 12-09-2010, 09:44 AM   #7
Moderator
ziggy29's Avatar
 
Join Date: Oct 2005
Location: Texas
Posts: 15,613
One of the problems with discussing how much money people have saved for retirement is that numbers like these rarely distinguish between those who will have pensions and those who don't. Someone who will receive a COLA'd pension that considerably exceeds their expenses may be fine with $0 saved for retirement. Those who have none, obviously not so much. Perhaps adding in the present cash value of vested pensions would provide a better apples to apples comparison.
__________________
"Hey, for every ten dollars, that's another hour that I have to be in the work place. That's an hour of my life. And my life is a very finite thing. I have only 'x' number of hours left before I'm dead. So how do I want to use these hours of my life? Do I want to use them just spending it on more crap and more stuff, or do I want to start getting a handle on it and using my life more intelligently?" -- Joe Dominguez (1938 - 1997)

RIP to Reemy, my avatar dog (2003 - 9/16/2017)
ziggy29 is offline   Reply With Quote
Old 12-09-2010, 09:51 AM   #8
Thinks s/he gets paid by the post
kyounge1956's Avatar
 
Join Date: Sep 2008
Posts: 2,171
Quote:
Originally Posted by David1961 View Post
I came across this article.

Middle class falls short on retirement funds - Yahoo! Finance

One thing that caught my attention is the following:

"Middle class is defined as those aged 30 to 69 with $40,000 to $100,000 in household income or $25,000 to $100,000 in investable assets and those aged 25 to 29 with income or investable assets of $25,000 to $100,000."

So does this mean if you are between 30 and 69 and have more than $100,000 in investable assets, you are not middle class? If so, what are you? Certainly not rich!
Unless you've amassed half a million in assets you are not even "affluent".
__________________
kyounge1956 is offline   Reply With Quote
Old 12-09-2010, 10:06 AM   #9
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
FinanceDude's Avatar
 
Join Date: Aug 2006
Posts: 12,484
Quote:
Originally Posted by ziggy29 View Post
One of the problems with discussing how much money people have saved for retirement is that numbers like these rarely distinguish between those who will have pensions and those who don't. Someone who will receive a COLA'd pension that considerably exceeds their expenses may be fine with $0 saved for retirement. Those who have none, obviously not so much. Perhaps adding in the present cash value of vested pensions would provide a better apples to apples comparison.
That makes way too much sense, why would any good media person actually use common sense like that?
__________________
Consult with your own advisor or representative. My thoughts should not be construed as investment advice. Past performance is no guarantee of future results (love that one).......:)


This Thread is USELESS without pics.........:)
FinanceDude is offline   Reply With Quote
Old 12-09-2010, 10:57 AM   #10
Moderator Emeritus
Bestwifeever's Avatar
 
Join Date: Sep 2007
Posts: 16,375
Middle class in terms of the social sciences historically has a more useful and interesting breakdown: http://www.encyclopedia.com/topic/Mi...ddleclass-full

The numbers in the article are only Wells Fargo's definition of middle class (although it also uses the term "middle income" which is likely more accurate) for its report, whose aim is probably to get people to come to WF. The numbers imho are awfully low.
__________________
“Would you like an adventure now, or would you like to have your tea first?” J.M. Barrie, Peter Pan
Bestwifeever is offline   Reply With Quote
Old 12-09-2010, 11:13 AM   #11
Thinks s/he gets paid by the post
 
Join Date: Jan 2006
Posts: 2,975
Quote:
Originally Posted by David1961 View Post
I came across this article.

Middle class falls short on retirement funds - Yahoo! Finance

One thing that caught my attention is the following:

"Middle class is defined as those aged 30 to 69 with $40,000 to $100,000 in household income or $25,000 to $100,000 in investable assets and those aged 25 to 29 with income or investable assets of $25,000 to $100,000."

So does this mean if you are between 30 and 69 and have more than $100,000 in investable assets, you are not middle class? If so, what are you? Certainly not rich!
I agree with the income part but not sure about the asset part as that seems too low. You don't need to be "rich" to be above middle class, you just need to be in the upper 1/3 of the population which most of us are.
__________________
aaronc879 is online now   Reply With Quote
Old 12-09-2010, 11:15 AM   #12
Recycles dryer sheets
 
Join Date: Jul 2008
Posts: 150
Middle class are people who pay the most taxes, getting the least from tax cuts and receive no help from goverment entitlement programs.
__________________
huusom is offline   Reply With Quote
Old 12-09-2010, 11:38 AM   #13
Thinks s/he gets paid by the post
Fireup2020's Avatar
 
Join Date: Feb 2007
Posts: 1,186
Do two "middle class" citizens living together now mean they are no longer "middle class" since together they exceed the dollar limits??

Why do I feel like "middle class" has negative connotations these days?
__________________
Make no mistake, my friend, it takes more than money to make men rich. - A. P. Gouthey
Fireup2020 is offline   Reply With Quote
Old 12-09-2010, 11:40 AM   #14
Thinks s/he gets paid by the post
jIMOh's Avatar
 
Join Date: Apr 2007
Location: Milford, OH
Posts: 2,085
what is an average?
what was the median amount in the retirement accounts?
what is the amount in retirement accounts adjusted for expenses?

someone with 100k in a retirement account is in great shape if expenses are under 10k annually... where as if someone has 60k in annual expenses, they are in not good shape with same 100k.
__________________
Light travels faster than sound. That is why some people appear bright until you hear them speak. One person's stupidity is another person's job security.
jIMOh is offline   Reply With Quote
Old 12-09-2010, 11:40 AM   #15
Recycles dryer sheets
Tractor guy's Avatar
 
Join Date: Sep 2010
Posts: 105
I think "middle class" is a term that is defined relative to your own position. Most everybody I've met that is working in the U.S. considers themselves middle class, even if their life style is upper crust. My definitions is: If you don't have to work and can buy anything you want, you're wealthy. If you have to work but can't find a job, then you are either poor or will be shortly. If you can't buy everything you want you're middle class.

My last job put me in a position to meet and socialize with several megacorp upper management who I considered "rich." They were high enough in the company that their salary and stock options were in the annual report. These were people who were taking home more than $1M/year in options.

I found that every one of them considered themselves "comfortable" and knew personally some one who was "rich." The guy who owned and raced a 10 year old Porsche on the weekend knew a rich man who owned 3 brand new factory prepared ones. The guy who used a company plane wasn't rich but knew a rich guy owned his own Lear jet, etc.

I've also seen some of the third world poor (beggars in the night markets in Cambodia and Thailand) and come the realization that anybody with a job in the U.S. is rich from their viewpoint.

Lorne
__________________
Tractor guy is offline   Reply With Quote
Old 12-09-2010, 11:43 AM   #16
Recycles dryer sheets
 
Join Date: Dec 2008
Posts: 116
Middle Classs are people who earn what I earn. People who earn less are either struggling or lower middle class. People who make substantially more are affluent or wealthy.

I don't think you can generalize across such a large, diverse population. 47% of working people over 25 years of age earn less than $25K/year. That's an enormous population with, what seems to me, very little income.

75% (again, of working people above the age of 25) make under $50K.
__________________
FreqFlyer is offline   Reply With Quote
Old 12-09-2010, 11:44 AM   #17
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Gone4Good's Avatar
 
Join Date: Sep 2005
Posts: 5,381
The answers people give to this question always amaze and confound me because they never seem to correspond to any objective definition of what it means to be "rich" or "middle class." For most people the definition for "rich" means someone who has, or makes, more than they do. The definition for "middle class" is most often "me."

Here's a graph I just put together from the census data that shows U.S. household income by percentile. The way to read this is that each bar represents the percentage of the population who makes less than that level of income. So for example, the "median" income, or the bar at the 50% mark, is for household income between $50,000-$54,000. That seems like a good definition for "middle class" as it truly represents the middle.

Other data points of interest, if your household earns between $90,000-$94,999, you earn more than 75% of your fellow citizens. If you make between $140,000-$144,999 you earn more than 90% of everyone else. And at $200K and above, you earn more than 96.2% of everyone else.

My definition would be that middle class means "middle" so around $50K +/-. And "rich" would mean top decile, so $140K and above. Regional difference probably skew this by a standard deviation, or so, but not by much more.
Attached Images
File Type: jpg Capture.JPG (105.4 KB, 44 views)
__________________
Retired early, traveling perpetually.
Gone4Good is offline   Reply With Quote
Old 12-09-2010, 11:50 AM   #18
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Gone4Good's Avatar
 
Join Date: Sep 2005
Posts: 5,381
Quote:
Originally Posted by Tractor guy View Post
If you can't buy everything you want you're middle class.
By that definition, everyone can be middle class. Suppose Bill Gates wants to own Australia, like Lex Luthor in Super Man II . . . does that make him middle class because he can't afford it?
__________________
Retired early, traveling perpetually.
Gone4Good is offline   Reply With Quote
Old 12-09-2010, 11:54 AM   #19
Give me a museum and I'll fill it. (Picasso)
Give me a forum ...
Gone4Good's Avatar
 
Join Date: Sep 2005
Posts: 5,381
Quote:
Originally Posted by FreqFlyer View Post
Middle Classs are people who earn what I earn. People who earn less are either struggling or lower middle class. People who make substantially more are affluent or wealthy.
That seems to be how it works.
__________________
Retired early, traveling perpetually.
Gone4Good is offline   Reply With Quote
Old 12-09-2010, 12:58 PM   #20
Thinks s/he gets paid by the post
MasterBlaster's Avatar
 
Join Date: Jun 2005
Posts: 4,359
The New York Times had a competition where they let the readers post their definition of what middle class is. Some of them are very clever.

Weekend Competition: Define Middle Class - Readers' Comments - NYTimes.com

Quote:
Middle Class is like a counterfeit Louis Vuitton purse: the illusion of wealth built on a lot of plastic.
Quote:
Middle class is a state of illusion that makes you think you are not and will never be poor, regardless of your lack of assets and your levels of debt...
Quote:
The American Middle Class now are largely defined by the span of their middles.
__________________

__________________
MasterBlaster is offline   Reply With Quote
Reply


Currently Active Users Viewing This Thread: 1 (0 members and 1 guests)
 
Thread Tools Search this Thread
Search this Thread:

Advanced Search
Display Modes

Posting Rules
You may not post new threads
You may not post replies
You may not post attachments
You may not edit your posts

BB code is On
Smilies are On
[IMG] code is On
HTML code is Off
Trackbacks are Off
Pingbacks are Off
Refbacks are Off


Similar Threads
Thread Thread Starter Forum Replies Last Post
"World-class colonoscopy" Nords Health and Early Retirement 312 05-17-2016 09:53 PM
A Discussion About the Middle Class keegs FIRE Related Public Policy 33 10-29-2010 11:17 AM
Wanna do our own "Ladies and Gentlemen of the class of '97"? tmm99 Other topics 9 12-11-2009 04:03 PM
Business Week: "Meet the Senior Class" Nords Life after FIRE 15 12-17-2005 01:51 PM
Decline of the U.S. Middle Class? Cut-Throat Life after FIRE 83 09-10-2004 08:32 AM

 

 
All times are GMT -6. The time now is 03:46 PM.
 
Powered by vBulletin® Version 3.8.8 Beta 1
Copyright ©2000 - 2017, vBulletin Solutions, Inc.