We’ve got the poor, the middle class, the upper class, and the rich. This article looks at the definition of upper class based on income and several other factors.

When you think of the words “upper class,” what do you imagine? I often conjure some passengers sitting on a British Airways flight. They are literally sitting in a section of the plane called Upper Class. Weird.

Let’s be frank. Upper class has an arrogant tone to it. I don’t know anybody in America who uses the term upper class when speaking. Perhaps it’s a European thing.

In America, we use the term “mass affluent” or “aspirational class” instead of upper class. Nobody in America would ever publicly say they are upper class unless they want to get beat over the head. Instead, people would much prefer to say they are middle class.

A middle class income is all you need to be happy. However, we are a society who always wants more. Even after we reach an arbitrary income level, we aren’t satisfied for very long.

I have a theory the majority of us, no matter how little or how much we make, consider ourselves part of the middle class. When I worked at McDonald’s for $4 an hour, I was dirt poor, but considered myself middle class because both my parents had jobs and I had a bicycle and a cozy home to come home to.

When I finally graduated from The College Of William & Mary and started making more money, I felt poor because all I did was work in expensive New York City!

For example, I shared a studio with a high school classmate for $2,100 a month and that was in 1999. It was the only way I could attempt to achieve financial independence on a modest income.

It was only after I moved to San Francisco did I feel I was part of the middle class again. Money was more plentiful, a starter home back then was “only” cost about $1,100,000. I also had more free time to explore.

I’ve experienced all three classes to varying degrees and I believe there are wonderful merits to each of them. From the poor Haitian immigrant who goes to college and becomes the first black female mayor in Utah, to the billionaire investor who gives 99% of his net worth to charity, everyone tends to come to center.

My favorite class is the middle class. But first, we must define what middle class means.

One of the most curious things about the stock market is that it’s slow to rise and FAST to fall. This phenomenon simply points to the human condition of being cautiously optimistic when times are good. And then people absolutely freak the freak out when times are not! Scared that your job is at risk? Don’t panic. By the end of this post you will know how to protect yourself from a mass layoff.

Mass Layoffs Hurt Millions

The government forced shutdowns in 2020 due to the coronavirus has led to many a company having a RIF through a mass layoff. RIF stands for reduction in force.

Unemployment levels in the US and around the world skyrocketed. Over 44 million Americans filed for unemployment as a result of the lockdowns. Take a look at the chart below.

Lucky employees have managed to escape a mass layoff, but still fear losing their jobs. Others, have been temporarily furloughed and anxiously await news on if and when they can return to work.

Laid Off Versus Furloughed

Getting furloughed is different from getting laid off. When an employee is furloughed, they must take an unpaid leave of absence. The leave of absence may be short-term or long-term. It all depends on the employer and the state of its financial hardship.

However, furloughed employees can typically retain employee sponsored health insurance and retirement benefits. In addition, furloughed employees are eligible to receive unemployment benefits.

In contrast, when an employee is laid off they lose all ties to the employer. They are not able to return to their jobs in the future. They also lose employer sponsored benefits as well. However, some benefits may still be available for a short-term period after their last day of employment.

Employees who are able to negotiate a severance package, leave with the most. They can receive severance money, retain health insurance for a short time, collect unemployment, get paid unused vacation days, get paid deferred compensation, etc.

Managers Overreact On The Way Down

Hiring managers are just as bad as investors. Not only do they tend to over-hire on the way up because it’s not their money they’re spending, but they also tend to over-fire on the way down because it’s not their lives they’re hurting.

They selfishly think that the more people they let go, the better their chances are of keeping their own jobs! Stock market corrections of 10-20% are enough to make managers wig out, even if the markets are still up 50% since the day they started.