The majority of us are middle class, defined as neither rich nor poor. Seriously, that’s the official definition of middle class, because depending on who you talk to and where they live, you’ll get different answers. A $50,000 household income for a family of four is absolutely middle class in Des Moines, Iowa but is closer to poverty in New York City.
Statisticians say middle class is a household income between $25,000 and $100,000 a year. Anything above $100,000 is deemed “upper middle class”. It’s funny how there’s no usage of the categories “lower class” and “upper class” isn’t it? It’s as if someone didn’t want to hurt someone else’s feelings. In cities such as San Francisco and New York, middle class income might very well extend all the way up to $250,000 given the median house price in San Francisco is $700,000 and it regularly costs $1,000+/sqft in New York City to buy.
Whether you make $30,000 a year or $250,000 a year, I venture to guess the majority will consider ourselves middle class. There’s an important psychology involved, and that is when it comes to financials, nobody wants to stray too far from the core. If you consider yourself rich, you will be hunted down. And if you start considering yourself poor, others will ridicule you for being dumb or lazy.
Classifying yourself as middle class keeps you safe and warm!
WE ALL CAME FROM SOMEWHERE MIDDLE CLASS
As a kid, there were only two things I ever wanted: 1) a Nintendo console and 2) a camera. I never got either because my parents wouldn’t allow me to waste my time on video games, and a camera was a grown up toy. It’s a shame, because it would have been great to capture my childhood and reminisce. Ah, the inability of the middle class to have everything they want unless they work for it!
My family was by no means poor, they just weren’t rich. In fact, we had everything we needed – food, clothing, love, and shelter. We lead very simple lives, buying second hand clothes, living in a suburbian townhouse, and driving beater cars. I still remember the paintless, 15 year-old Nissan Datsan my father drove. I’d duck in horror whenever he’d drop me off at school. I even snuck the metal beast out in a torrential downpour and two hubcaps flew off while I was doing burnouts. My parent didn’t even know, the car was that pitiful!
Most wealthy people didn’t grow up with a Butler named Belvedere. Instead, they grew up middle class just like many of us. I’m always so disappointed when President Obama pits the rich against the poor since the chances are very high that we’ve all been in the same middle class once before.
The top 1% might even have more perspective than the majority of us. They know what it’s like to not have much, and now know what it’s like to afford almost anything. We should draw on their experiences. After all, “the rich” are also the ones who donate the most to charity, provide jobs, and provide investment capital for our start-up ideas.
MIDDLE CLASS IS A WONDERFUL CLASS
Growing up middle class lets me appreciate all the things I have today. I can’t imagine growing up rich because I would probably always feel inadequate compared to my parents. Imagine living in a 8,000 square foot mansion your entire life, only to be able to afford a 800 square foot fixer several years after college? Imagine rolling around in a S500 Benzo with a driver, but only afford a Toyota Yaris upon graduation. Imagine eating toro sashimi and prime rib every weekend with the folks, and all you can afford now is the occasional Panda Express. Yuck.
The middle class is what makes America hum. We’re either a part of the middle class now, or have been there once before. In other words, we’re all about the same, so let’s treat each other the same. No more bickering between different socio-economic classes. We all have the same rights and freedoms to do whatever we want, forever.
Recommended Products For Increasing Your Wealth
Manage Your Finances In One Place: Get a handle on your finances by signing up with Personal Capital. They are a free online platform which aggregates all your financial accounts in one place so you can see where you can optimize. Before Personal Capital, I had to log into eight different systems to track 25+ difference accounts (brokerage, multiple banks, 401K, etc) to manage my finances. Now, I can just log into Personal Capital to see how my stock accounts are doing and when my CDs are expiring. I can also see how much I’m spending every month. If you are interested, they can even provide tailored financial advice for much cheaper than traditional wealth managers.
Check Your Credit Score: Everybody needs to check their credit score once every six months given the risk of identity theft and the fact that 30% of credit scores have errors. For over a year, I thought I had a 790ish credit score and was fine, until my mortgage refinance bank on day 80 of my refinance told me they could not go through due to a $8 late payment by my tenants from two years ago! My credit score was hit by 110 points to 680 and I could not get the lowest rate! I had to spend an extra 10 days fixing my score by contacting the utility company to write a “Clear Credit Letter” to get the bank to follow through. Check your credit score for free at GoFreeCredit.com and protect yourself. The averaged credit score for a rejected mortgage applicant is 729!