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What is the Middle Class?

This article was written by in People. 17 comments.


“Middle class” is a term that has a hundred different meanings if you ask a hundred people for their definition. Unlike my frustrations with people who call a house a liability, or more accurately, those who claim a house is not an asset, the label of middle class leaves a lot to personal interpretation.

While a class system isn’t as important in today’s society as it once was, class mobility, moving from one station in life to a higher status, isn’t as easy as success seminars claim. In fact, downward mobility may be the trend for a while. But how can we know where we stand without a firm definition of class?

Wkipedia, certainly not the ultimate authority but good for a consensus view, offers these factors of the middle class:

  • Achievement of tertiary education.
  • Holding professional qualifications, including academics, lawyers, engineers, politicians and doctors regardless of their leisure or wealth.
  • Belief in bourgeois values, such as high rates of house ownership and jobs which are perceived to be “secure.”
  • Cultural identification. Often in the United States, the middle class are the most eager participants in pop culture…

U.S. News has a helpful guide for gauging your middle class status. For example, the middle 50% household incomes of the country ranges between $51,000 to $123,000 for a four-person, two-parent family. The typical home’s value is $231,000 and is about 2,300 square feet.

The average family takes one week-long vacation, while some select few in the middle class might take two weeks throughout the year. Each year, this family saves $2,600 for retirement and spends $14,200 on necessary household expenses.

These statistics are mostly meaningless on an individual level, however. A household income of $51,000 might qualify you for middle class in Pahrump, Nevada, but you might not be able to afford to rent a modest apartment in New York City on that salary.

After giving the concept of middle class some thought, I’ve settled on one major touchstone that should be accurate regardless of where you work or your education level. If you are not living paycheck-to-paycheck, and instead earn enough money to handle your necessary expenses with enough left over to save for immediate and long-term goals, you are at least in the middle class.

If you are living paycheck-to-paycheck, it would be harder to convince someone you could be labeled middle class.

Labels, like “middle class,” fulfill what seems to be an innate need to classify people and things. I’m fine without labels. How would you define middle class?

Updated December 21, 2010 and originally published April 17, 2010. If you enjoyed this article, subscribe to the RSS feed or receive daily emails. Follow @ConsumerismComm on Twitter and visit our Facebook page for more updates.

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About the author

Luke Landes is the founder of Consumerism Commentary. He has been blogging and writing for the internet since 1995 and has been building online communities since 1991. Find out more about Luke Landes and follow him on Twitter. View all articles by .

{ 17 comments… read them below or add one }

avatar Financial Samurai

I like your definition Flexo, “If you are not living paycheck-to-paycheck, and instead earn enough money to handle your necessary expenses with enough left over to save for immediate and long-term goals, you are at least in the middle class.” of middle class.

What is the proper definition of one step above middle class? Upper-middle class and then upper class or rich?

Cheers, Sam

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avatar Bucksome Boomer

I’m going to be the naysayer. There are plenty of people that make good incomes for their area and still live paycheck to paycheck. Income wise, they might even be considered upper class.

I would say your definition is the ideal, but not reality. I think the income classes should be defined by geographically-adjusted income ranges even though that’s more complex.

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avatar Evan

Interesting question, but unfortunately, I think that you’re way off base with the direction of this. Using a touchstone of living paycheck-to-paycheck really has nothing at all to do with class. In my 20s, a friend of mine would tease me that I could live for a month on $3. I was only earning around $13,000 per year, yet I was able to live within my means and had slowly saved enough money so that I had enough socked away to live on for about 6 months in case something happened. I did not live paycheck to paycheck, rather, I planned all of my expenses in advance.

On the other hand, now that I’m in my 40s, I have friends from all different economic classes. Two people I know earn well over 100K per year but actually live paycheck-to-paycheck. All that’s about is your planning, savings rate and how much you spend.

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avatar guinness416

Totally agree with BB. This definition doesn’t work for me – it’s why there’s people around claiming they were poor as kids despite having parents studying for phds at the time. I like wiki’s definition.

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avatar Guy G.

Hey Flexo,

This was a good description of the middle class by wiki.
Have you noticed any evidence of the middle class disappearing?
I’ve been hearing more about this rumor and wasn’t sure what to think.
I think the thought behind it is that the poor group is growing as is the rich and the middle class is shrinking because their addiction to safe and secure jobs are taking away from their opportunity to succeed in a real way.

Thanks for sharing,
Guy

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avatar Ryan@TheFinancialStudent

I think there’s two types of paycheck to paycheck:

1. You make plenty of money, but you blow it on extras and luxuries: eating out constantly, luxury car, home theater, etc.

2. Your expenses are minimal, but your income just doesn’t provide much if any to save.

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avatar David M

Middle Class,

In America that’s about 85% of the people. Virtually, everyone thinks of themselves as the middle class in America.

Why, because, no one wants to think of themselves as poor or rich. In America poor and rich are bad words to many people.

I like Financial Samurai’s question, “What comes after Middle Class?”

For example, I’m married with no children and our combined income is about $160,000. We have about $500,000 in retirement accounts and $300,000 in cash and stocks in non retirement accounts. We have a $400,000 house with a $200,000 mortgage. Our 1 car is paid off. We have no debt besides the mortgage. We are in our mid 40′s. What am I? Maybe upper middle class?

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avatar Kate

I would call that rich! :)

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avatar BenWL

Ok here’s my definition of middle class:

1. Stay in a rented apartment in a city and owns a car.

2. Have sufficient money for daily activities: eating, bills, transportation, medical, parties, etc.

3. Travel around the world annually.

4. Annual salary is between $10 and $100K for an individual.

5. Owns at least one credit card and some personal insurance.

6. When travelling stay in 3 star or less hotels.

7. Dine in ordinary cafes that most people would visit.

8. When doing exercise opt for cheaper options such as basketball, jogging, swimming, etc.

9. Buy new clothes once a year.

10. Dine in posh restaurants only during special occassions; weddings, reunions, anniversaries, birthday celebrations, etc.

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avatar David M

By your definition, the middle class is very small – I would guess less than 1%. Much less than the self identified middle class in America which I would guess is 60% or so.

Why would the middle class travel around the world annually? Or why would they have to rent and not own? (I’m asking these questions out of curiosity, not to try to correct you or anything like that.)

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avatar Joe Taxpayer

Ben, home ownership is 60%+ or so I thought. Middle class still means ownership. $10K/yr income is below poverty level, the middle starts somewhat higher than that. I assume by travel the world, you just mean ‘take a vacation’ of some sort. Not sure where you’re going with #8. Gym memberships are well within affordability of the middle.
Interesting list, I’d just tinker with it a bit.

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avatar Dan

I make $70k annually and live in suburban DC. I really can’t afford to buy much, so I rent. I *really* can’t say I’m not middle class merely because I rent.

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avatar Joe Taxpayer

Nice article, opens the way for many more questions. Sam and Dave touched on them.
I’ve also read that (for example) a plumber, regardless of income, he may own a plumbing supply house and have 100 employees, etc, can never be upper class. That upper class contains doctors, lawyer, politicians, and a limited list of white-collar professionals.
David doesn’t mention his profession, but the numbers hint at upper middle.
If “upper class” is a number (along with the advanced degree) I’d be curious to hear what that might be.

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avatar David M

I am a Certified Public Accountant. I work as an auditor for the United States Government.

I only have a bachelors degree. However, I have heard that some consider being a CPA as equivalent to having a masters degree – I don’t know what % of people think this to be the case.

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avatar RainyDaySaver

I think defining “middle class” is one of the hardest things to do. I don’t think you can use the definition of living paycheck-to-paycheck because, as others have already pointed out, people in all income ranges can (and do) spend as much as they earn. We’re solidly middle class, own a home, have two cars (one 1 year old, one 6 1/2 years old and paid off), work FT, have some debt, save more money toward retirement than the $2600/yr cited.

Also, incomes vary by area — $80,000 might make you “rich” in more suburban areas, but if you live near some of the bigger cities (LA/NYC, which I’m just a few miles away from), it’s just going to keep you comfortable, let you save some money and allow you to take a vacation once in a while.

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avatar jim

Personally I generally tend to think of middle class as defined as the middle 60-80% of income (relative to your geographical area). Poor people and rich people are not middle class. Most Americans think they are in the middle class whether they are or aren’t.

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avatar Let me Be Unknown

The thing is, its a shady dotted line that seperates classes.

One person may be from a lower class, but dress well etc. One person may be from the elites and dress poorly. By dress sense of well and poorly, I mean the type of clothes they wear. Whether they seem new and ashionable or old and not. The truth is, contrary to popular belief – the lower and middle class are the most consp[icious. By middle class I also include the upper end of the middle class. The ones at the upper class (I am talking about big dollars – those who have multiple BMW’s etc) may be conspicious to a large extent, but the higher end of the upper class (billionaires) are really quite humble in their spending. Yes you may call it MPC and MPS. However, most billionaires that I know (and I know a few) wear simple clothes that sometimes are even old and holed. Quite a few billionaires – such as Buffet, those more economical in nature tend to be quite frugal with spending too.

As many economists will know, wealth and income are different things. Thus, how can you judge class? By wealth or by income? Is it possible for someone who is extremely wealthy to be rich if they have no income? Or should we consider someone with no wealth but beginning to earn an income of $1 million per month wealthy?

Its furthermore, difficult to judge someone of their class by characteristics. Our family for one, we drive a Japanese car that does not qualify for the luxury car tax. Yet in terms of accessories and extras, we possess many good brands. For example, I, myself have four laptops: an Alienware for gaming, a MBP for the looks (lol), a HP for school and a Lenovo as backup. We go on overseas holiday quite often and stay at 4-5 star hotels for about 3 months per year. We buy the latest technology, and we buy a great deal of books (which are quite expensive, being academic in nature – they are usually around $200, such as those of the older nature). YET we live in a small house in an ok suburb. YET I don’t buy the latest clothes. YET I don’t even own a car (true, I haven’t got my full license – but most of my peers already have their own cars). BUT we have multiple properties domestically and worldwide. BUT we owe a great deal of debt.

So would my family be considered lower, middle or upper class? I certainly don’t speak elegantly or poshly – in fact, I stumble in my speech. A bit like Emperor Claudius, I am afraid. I swear often, like a wog and a lad. So?

It’s just impossible to define a class. We’re not living in a Marxist world. Neither are we living in the Soviet Union. Nor are we in or before Renaissance Europe. As it would be anachronistic to compare civilisations, so too it would be wrong to compare and define classes in today’s society.

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