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Old 02-15-2021, 12:40 PM   #21
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I don't spend anywhere near that much, but I live alone with a paid off house and car plus no debt or dependents.

The range you suggest seems insanely high to me, bat-$hit crazy high. Honestly I am spending as much as I can (since my retirement is over-funded). I don't hang out with billionaires, but I think most people in New Orleans would say my lifestyle is middle class or slightly higher than that.

I would suggest maybe $20K-$40K.
Income comes in many forms. If you own your house free and clear, the unrealized investment income on its value is paying your monthly "rent". If you have employer paid health insurance or Medicare, the monthly premium subsidy is income. Even no longer having to save for retirement is a huge boost in disposable income over those still working.
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Old 02-15-2021, 12:45 PM   #22
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In the area I live someone need to earn at least $400K annually to live more or less comfortably.
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Old 02-15-2021, 12:47 PM   #23
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Income comes in many forms. If you own your house free and clear, the unrealized investment income on its value is paying your monthly "rent". If you have employer paid health insurance or Medicare, the monthly premium subsidy is income. Even no longer having to save for retirement is a huge boost in disposable income over those still working.
Absolutely! No question about it. And setting up my retirement this way, in a reasonably LCOL area, wasn't even slightly accidental.
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Old 02-15-2021, 12:48 PM   #24
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Yes it's truly an impossible generalization. There's that home improvement show in Laurel Mississippi. I'm not going to move there, but man they can get some decent real estate and then there's the home improvement show in Waco Texas. Same deal you're seeing houses for $25,000. it's just insane compared to what many of us are used to.
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Old 02-15-2021, 01:07 PM   #25
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I don't spend anywhere near that much, but I live alone with a paid off house and car plus no debt or dependents.

The range you suggest seems insanely high to me, bat-$hit crazy high. Honestly I am spending as much as I can (since my retirement is over-funded). I don't hang out with billionaires, but I think most people in New Orleans would say my lifestyle is middle class or slightly higher than that.

I would suggest maybe $20K-$40K.
You numbers are good in the Midwest and South.
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Old 02-15-2021, 01:33 PM   #26
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Do you factor in sunk costs? We've paid off our mortgage in High COL southern California and can live quite comfortably on $50-60K. Add in a mortgage and it can go up considerably.
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Old 02-15-2021, 02:51 PM   #27
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There's that home improvement show in Laurel Mississippi. I'm not going to move there, but man they can get some decent real estate
Laurel MS. is ground zero for every tornado coming through that part of the country. I suspect folks have to home improve every so often. We lived south of Laurel and never saw one tornado.
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Old 02-15-2021, 03:43 PM   #28
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Married with 3 kids in public schools, drive older Hondas. 2100 sq ft house on small suburban lot. We usually take 2 nice vacations a year and we still have a mortgage. Still working.

We spend around $140k/year, excluding health insurance and income taxes.
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Old 02-15-2021, 04:12 PM   #29
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In contrast to the how low can you go thread, I've started this thread.
That thread was about spending.

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Poverty level in the US is $17,420 for a household of two. I don't see that as something to shoot for.
That refers to income.

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Now the question is, what is middle class? I'm going to suggest $40k to $90k as my criteria. That pretty well covers the median household income of $68K.
That refers to income.

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We are living on $55k.
That sounds like spending.

You have to understand that income and spending are two different things. According to the Pew linked posted earlier, I'm upper class in my area with a 6 figure income. Yet, my barebones spending is about $13,000/yr to get all the required bills paid, food on the table and such, and then add on about $2000/yr or less in discretionary spending in recent years for entertainment, buying stuff I don't need, etc. So, that's $15,000 spending total. I'm still working, so I need to pay taxes, and add in a buffer to address larger long term expenses, and I could live a middle class lifestyle on about $30,000/yr income over the long term assuming I'm still paying the same amount for healthcare insurance as I am now through my current employer. I don't really need to add anymore to my retirement accounts at this point.
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Old 02-15-2021, 04:47 PM   #30
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We spend $20K just on property taxes and insurance.

Where you live is a huge variable for this discussion. Nobody is going to live middle class in Manhattan, Honolulu or San Francisco on $40K.
I know nothing about middle class in SF or NYC but in Honolulu, I know lots of folks living what we (in the Islands) would call middle class on roughly $40K. Here, middle class may include 2 generations in one house. I have good friends who used to (briefly) have 4 generations in the old homestead in Manoa Valley. True, you probably need two of those $40K earners to afford the housing, but you're not considered "poor" simply because you share housing - especially with extended family. Where folks struggle is in the young singles community. If a single person wants any decent apartment (let alone a house) he/she will need multiple jobs OR one of the very few very high paying jobs that aren't due to long seniority in a union. IOW singles in their own living space are relatively rare by comparison to LCOL areas of the mainland.

I think this is why Middle Class is such a difficult term to define. If you define it in terms of income, the differences will be vast (maybe as big a spread as
$20k to $400K income.) Defining how folks actually live (within middle class) adds a whole other complexity to the subject.

By the way, Honolulu real estate taxes are quite low compared to most areas of the USA. $2000/year or less is common, even though houses go for $800K. Even Paradise has its bargains, but YMMV.
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Old 02-15-2021, 04:56 PM   #31
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I thought I did that with $40K to $90k, what you buy with that could go in every direction.
I'm not so sure $40K to $90K covers the full range of middle class living.

For example: 30 year old couple with 2 kids living in SF Bay Area.

Housing cost for starter home $45K to $60K
Daycare for 2 kids $20K to $25K
Food/Utilities/Cars $20K to $25K
Medical (employer covered to Self employed) $0 to $25K

Gifts/Vacations/Entertainment/Recreation/Saving for college/Children/Saving for retirement/replacement costs/ ect. Maybe $25K to $50K

At least $110K to $175K net income to sustain middle class SOL. Anywhere from $175K to $250K gross.
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Old 02-15-2021, 05:01 PM   #32
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I think there's a big difference (in every location) between middle-income and middle-class-lifestyle. Income is a data-point. Lifestyle is a whole other thing.

The implication of lifestyle is the typical trappings. Home, kids, cars, activities, vacations, not scrimping and saving every dime, but enough to have discretionary stuff, maybe get Timmy an xbox, save for college, etc.
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Old 02-15-2021, 05:35 PM   #33
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It really depends on where you live, if you have a mortgage, what your taxes are, how many kids you have, etc.

As noted, median household income is around 68K so 40-90K is hardly that high. Plenty of people around here pay 10K or more in property taxes alone on a modest home. You can't do that on a 40K income. It's even a little tight on 90K.

Add in 2 or 3 kids with all of the associated costs, a mortgage, maybe a car payment or two, a vacation or two each year, healthcare costs, perhaps still dealing with student loans, and there's no way you're getting by on 50K.
Spot on! For JUST property taxes on a middle class (albeit, nicer) subdivision home and "A"CA health insurance premiums without subsidies, we're near $25K - just those two expense lines.

"All in", MCOL area in the Midwest (albeit, blue state, so very high taxes) + living a pretty conservative middle-class lifestyle with no mortgage, all in all..roughly $100K between core expenses (utilities, food, leases on 2 very average vehicles, house expenses, property taxes, etc), healthcare (the "A"CA) premiums and income taxes. Of course, I track everything we spend in Quicken so know to the penny what we TRULY spend right down to the nitty gritty detail vs roughly estimating.

Now, it also depends on what you define as "middle class"..both DW and I came from VERY middle class/lower middle class backgrounds. Parents bought our clothes at KMart, we never went out to a restaurant except for "very" special occasions, didn't have cable, etc. But if you define "middle class" by today's standards, I'd say we're very much "middle class" and there are a heck of a lot of people that we know personally living much more fancy than we are that would ALSO consider themselves "middle class"..
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Old 02-15-2021, 05:37 PM   #34
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That thread was about spending.

That refers to income.

That refers to income.

That sounds like spending.

You have to understand that income and spending are two different things. According to the Pew linked posted earlier, I'm upper class in my area with a 6 figure income. Yet, my barebones spending is about $13,000/yr to get all the required bills paid, food on the table and such, and then add on about $2000/yr or less in discretionary spending in recent years for entertainment, buying stuff I don't need, etc. So, that's $15,000 spending total. I'm still working, so I need to pay taxes, and add in a buffer to address larger long term expenses, and I could live a middle class lifestyle on about $30,000/yr income over the long term assuming I'm still paying the same amount for healthcare insurance as I am now through my current employer. I don't really need to add anymore to my retirement accounts at this point.

OH! I thought everyone was retired living on their nest egg. My mistake, I wanted it to be spending after retirement, but not a bare bones, I can't get a $4 shake at Chick-fil-A, more of a middle class retirement.
I'll try to be more clear on my next thread.
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Old 02-15-2021, 07:04 PM   #35
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What I find interesting is, regardless of the large variation in cost of living and incomes across the land, there seems to be one "poverty level".
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Old 02-15-2021, 07:23 PM   #36
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OH! I thought everyone was retired living on their nest egg.
I totally didn't get that from your question. That makes a big difference since you may be debt-free, kids grown and on their own, etc. I'm still working so I can't speak to that question at all yet.
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Old 02-15-2021, 07:24 PM   #37
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What I find interesting is, regardless of the large variation in cost of living and incomes across the land, there seems to be one "poverty level".
This is a common problem when they set anything based on income and use the same number nationwide. Whether it's taxes or SS or whatever. It makes a huge difference where you live.
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Old 02-15-2021, 07:32 PM   #38
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I totally didn't get that from your question. That makes a big difference since you may be debt-free, kids grown and on their own, etc. I'm still working so I can't speak to that question at all yet.
I agree. Question is just too broad. For instance buying a car. I have paid $500 for a 1987 Toyota Camry with 245K miles in. I have also paid 46K for a fully loaded Mini Cooper. Same goes for housing. Have paid $100/month to live on a buddies couch to the 3K/mo I currently pay on our mortgage. Fly space A military for $10 and also pay over 1K for first class to Australia. Way too many variables involved in answering OP's question.
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Old 02-15-2021, 07:44 PM   #39
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Phew! Seems like a lot of conversation, just so y'all can determine where you fit into the socioeconomic hierarchy. Actually, there has been no talk of the social aspect, so I'll amend that statement to say "economic hierarchy".

My eldest brother and I were talking about our ancestors in the early part of the 20th century in the UK, when the middle class was much smaller. No-one in our family had much materially, but certain members were, in general, graceful and well-read. We liked this idea.
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Old 02-15-2021, 07:46 PM   #40
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OH! I thought everyone was retired living on their nest egg. My mistake, I wanted it to be spending after retirement, but not a bare bones, I can't get a $4 shake at Chick-fil-A, more of a middle class retirement.
I'll try to be more clear on my next thread.
Maybe you bailed out before reading the rest of my comment because I gave my total actual spending as well and about how much income I think I would need to live a middle class lifestyle over the long term - $30K/yr. But if you are asking about retirement, $25K/yr spending would be enough for my single middle class lifestyle (that includes modest discretionary), but I have a much more generous FIRE budget planned.
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