Middle, Upper Middle Class Distinction for Retirees

[Golden sunsets]

Out of pure curiosity what comes after “upper mass affluent”?

[gerntz]

Upper MC to me is when you it's not necessary for you to budget & you do what to want to do as far as interest go. If you wish to live in an expensive place, that's your primary interest being fulfilled.

[travelover]

I think that the government should set the definitions and then that information should be on your identification papers like driver's license and passport. Also, it would end any ambiguity. If you came into a little more money you could appeal for a higher classification.

[Ronstar]

Quote:

Originally Posted by gerntz I disagree. That some choose to spend it largely on living location & others don't doesn't change the affluence level.

Maybe not, but it certainly changes the perceived affluence level. And that is all that class is - one’s perception of how others live.

As I drive my rusted 2001 Acura through the streets of Scottsdale, Az, I get some condescending looks from the Bentley and Ferrari drivers -definitely appalled by my “lower class”. I don’t get the same looks at home in Illinois.

[samclem]

Here's how I would define "comfortable":
Home: 1800 sq ft (two-three people), structurally sound and not aesthetically objectionable inside or out, with all appliances working and all mechanical systems functional, including AC and heat. Located in a low-crime area (working definition: If you mistakenly leave the garage door open all night, you don't panic on noticing that in the morning or feel the need to inventory the contents. You can walk through your neighborhood any time day or night without significant risk of a becoming a crime victim). Where I live (southern Ohio), this costs about $1000-$1500/mo (incl utilities), or $12K- $18K per year.
Transportation: (a reliable and safe car, insurance, fuel and maintenance. For people in urban areas, it might be subway fare only, or include costs for parking a car 24-7). Where I live, this is about $500-$750/mo = $6k-$9K per year.
Groceries: About $150-$250/wk = $8K -13K per year.
Entertainment: Highly variable. Include cable TV, internet service, concert tickets, magazine subscriptions, hobbies, vacations of all types, etc. We could be content/not feel deprived if we spent $25K per year (but I think we spend more than that). I would bet most households in our relatively modest suburban neighborhood spend between $20K and $40K on these things.
Medical expenses/insurance: Highly variable. The BLS says the average family spends about $5K per year, so I'll use that.

So, to be comfortable (as defined above, where I live), a retired couple can expect to spend about $65K, with big differences up or down depending on how they want to spend their time. I don't know what "class" that is.

[MRG]

Call me whatever. As long as were comfy, secure, good health, and not w*rking I'm a wealthy person.

[mpeirce]

Upper Class "wealthy" - people who have full time staff (not just hire a once a week maid/lawn/pool guy).
Lower Class "poor" - people who live off government largess.
Middle Class - everyone else. Most people in the US are middle class.

[Teacher Terry]

I find it odd that people are describing a size of a home or yard in order to be considered middle class. Some people in the UMC choose to rent, in HCOL areas people may pay much more for smaller abodes or merely want to downsize. Some people don't want a big yard to care for.

[Surewhitey]

Apparently OP asked a hard / impossible question. Made me look around for the first time in a long time at various ways of looking at it. Here's my findings:

Average home in Dallas is $220k-ish; we live in one appx. twice that due to location, DD, crime. Old neighborhood, 1750 sq ft.

Our net worth (including the home) in the top 10% based on my findings. Nothing to write home about.

Our income last week, upper middle (barely); this week, upper as DW went back to corporate world...

Time of FIRE (likely 5 years) hoping to be in the top 5% (or better)

I'm one of the "if you have enough passive income and RE, you are in the upper middle to upper based on not needing to work and can make your assets create 10-20 years of income for RE. That's my personal opinion. I don't have a problem putting a label on it. Doesn't make me look differently at others, just a score keeper by nature and I always like to win...

Interestingly, I found an "average income by religion"...never knew such a thing was out there.

For what it's worth, I feel middle class all the way...

[frayne]

Don't know and don't care.

[Lawrence of Suburbia]

Quote:

Originally Posted by gerntz I disagree. That some choose to spend it largely on living location & others don't doesn't change the affluence level.

Cool, I'm moving to Sausalito!

[samclem]

Quote:

Originally Posted by Teacher Terry I find it odd that people are describing a size of a home or yard in order to be considered middle class. Some people in the UMC choose to rent, in HCOL areas people may pay much more for smaller abodes or merely want to downsize.

I don't know about "class", but it's true that some people prefer smaller places, or are willing to put up with them if other factors are more important. There are some amazing efficient small apartments, designed with a lot of thought and using top-shelf materials. Inside, they are more like the cabins of a luxury boat than a traditional homes--truly something to see. But, like a boat, you have to move this thing to get to that thing, or each space serves several functions, so you can choose to do one or the other, not both. Everything needs to be put away before starting something else. That's not objectionable to some people, but it's not something I'd be comfortable with.

Where I used to live (SoCal), nearly everyone in our neighborhood who worked spent at least 90 minutes on the road >each way< in their daily commute. They accepted it, nobody thought it was strange. It was just something they did. But, >to me< it is not something I'd be comfortable with--like living in a 500 sq ft apartment.

I'm glad we have choices.

[Red Badger]

Quote:

Originally Posted by REWahoo I think that's like asking "how far up is high"? It depends entirely on individual interpretation and it is unlikely my needs are the same as yours or any other poster here.

The answer is 34 feet. That is the height of the training towers at the US Army Airborne course and the US Army Air Assault course. A large study conducted in the 40's determined that soldiers who would jump off the 34' tower would jump from any height (there are occasional "passengers" who refuse to exit the bird, but it's rare).

[travelover]

Quote:

Originally Posted by mpeirce Upper Class "wealthy" - people who have full time staff ..........

Geeze, by this definition my dog is Upper Class.

[jcretire77]

Very Funny and true.

[joeea]

Quote:

Originally Posted by ShokWaveRider I spent this morning looking around for some indication as to what designates if a retiree is Middle or Upper Middle class.

Why?

[Katsmeow]

In a sense it doesn't matter. But, I was actually thinking about this the other day. Class has a number of factors to it. Income is part of it, but so is education. Some activities are more tied to certain "classes" than others. Some of the people I know who say class doesn't matter are people who were raised in one class and stayed there. It can be different if you changed.

I was raised in the working class. I lived in a neighborhood where most people had good jobs that didn't require a college degree. When I went away to law school I was suddenly around people who grew up in a very different environment. And, yes, there was a gulf at times between what I knew and thought and what those around me knew and thought. There was a difference between middle class (what I had considered myself growing up) and upper middle class (what I felt everyone around me was when I was working).

When DH and I were working full time we had upper middle class incomes and lived in that type of neighborhood. Maybe because of my upbringing we always did some things that were more middle classy. I liked chain restaurants that some of the people I knew barely even knew existed.

But, now with DH retired and me working only a few hours a month it is different. Our income is definitely a middle class income. We have more assets, of course, than most people earning that income for a living.

We are planning to move soon and I have thought about this when moving. We want to downsize and want a less expensive home. We currently live in one of those upper middle class gated enclaves. So most of the people in the neighborhood probably have college degrees. A few may not who have incomes though that are higher than average.

But, I was looking at some houses where we plan to move. The area is very safe. That isn't an issue. It is close to amenities. Within a very short distance is a very high income area that we don't want to buy in because we don't want to spend that much money on a house. Back when we were working we would have done that.

So, this area I am looking at has some smaller houses (which we want) and is safe, etc. But, I looked at the demographics and it has a very middle income average income. Only 1% or so of the people have graduate degrees. It is very clearly a middle class area. And, I did wonder what it would be like. Would I fit in with the neighbors? I mean in terms of interests and stuff like that. It was very clear years ago that I didn't fit in that well with the part of my family that didn't go to college and stayed in the same/similar areas that I grew up in. I still loved them as family, but we had little to talk about once we got past family stuff. So, I do worry a bit about moving into an area where we may not have that much in common with neighbors.

That said, I don't want to pay to live in the kind of area I would have lived in 15 years ago.

[Independent]

"Class" is a poorly defined, much argued term.
"Income" is somewhat clearer.

This information comes from the Current Population Survey:

This is 2015 income for 65+ couples where neither is currently working and they have two people in the house. The first column is percentile breaks -- that is, 10% of these couples had income over $113,500, another 10% between $80,600 and $113,500, etc.

0.90 113,500
0.80 80,600
0.70 63,000
0.60 51,900
0.50 42,200
0.40 35,700
0.30 29,900
0.20 24,700
0.10 18,300

This is not spending, some people are spending from more than their income, some less.
The Census Bureau works at including non-periodic withdrawals from IRAs in these numbers, but they aren't perfect. I believe that IRS data would be a little higher.

http://www.early-retirement.org/foru...ata-87063.html

[Red Badger]

Quote:

Originally Posted by Golden sunsets Out of pure curiosity what comes after “upper mass affluent”?

High Mass - celebrated by Catholics on high holy days.

[mpeirce]

Quote:

Originally Posted by travelover Geeze, by this definition my dog is Upper Class.

Definitely true for most pets these days. A true life of leisure.

There are still working (class) dogs and cats who have to hunt or herd, but these are now the minority.