According to a survey that was conducted by Northwestern Mutual,
an insurance company, seven out of ten Americans consider themselves middle class. But are they?
When you think of the middle class, you automatically assume most people fall into this
category. But if you take a closer look, according to a research conducted by Pew Research Center,
this category of people is reducing in size every other day.
Only 29% of the population sit in the middle class and 19% in the upper class. Obvious
If you are unsure, whether you are in the middle class or not. Here are 15 signs to look out for.
15) Your annual earnings are between $50,000 to $125,000
There are many ways of determining if you are in the middle class or not,
but one of the most accurate is evaluating your income bracket.
The amount of money you make annually is the easiest way to identify what class you belong to.
If you make between $50,000 and $125,000, then you belong to the middle class.
However, some people within this category don’t act as though they belong here. Instead
of using all their earnings to acquire memberships to fancy country clubs,
or spending it all on expensive luxurious items, they invest a large percentage of their income.
Their investment portfolio grows and they acquire appreciative assets that increase their net worth.
That is the difference between the middle-class person who earns $50,000
and spends as though they’re a millionaire, and the one who invests accordingly.
14) Your parents belonged to the lower or middle class
8 out of 10 adults who belong to the middle class grew up with parents who were either lower or
middle class. According to a recent research, 27% of people within the middle class said they
grew up with lower-middle-class parents and 44% said their parents belonged to the middle class.
Economist Raj Chetty, researched and found out that poor children born in some cities
are not likely to go up the socioeconomic ladder. He also found out that some Americans
move in and out of the middle-class category within different generations.
His research found out that 15% of middle class citizens grew up in
upper-middle-class backgrounds and 14% grew up in lower-income households.
13) You're slightly more optimistic about the economy
Citizens in the middle class are very optimistic about the economy, and they believe the next year
will be better than the next. They believe in growth and are positive about the future
economic outlook. According to research, 47% of those in the middle class believed that
the economy would improve in the coming years, compared to 43% of the population as a whole.
12) Owning Gym Equipment Most of the people within this class have
their own exercise equipment in their homes. This may include an exercise bike, yoga mat, treadmill
or any other equipment that will get your heart pumping without having to leave your house.
Citizens in the middle-class category are willing to invest in this
as they value their health. However, most of the time this equipment often goes unused.
Owning, home exercise equipment is a sign of wealth because not many people can
afford this. The lower-income citizens consider owning gym equipment at home a luxury.
11) Subscribe to Wine Clubs Wine clubs make people appear
wealthier, and the middle class strive to make themselves appear richer than they actually are.
The middle class and wine clubs are a match made in heaven. They pay a certain amount of
money regularly to have connoisseurs sent that would impress friends, colleagues and neighbors.
The problem with such clubs is that it’s not guaranteed that you will like
the wine. These wines also cost a lot more than what you would pay for at the store.
Wealthy people in the upper-class category don’t subscribe to such wines
as they are already aware of the kind of wines they like. Sometimes they even own the wineries.
They don’t need experts picking up their wines and telling them what they need to drink.
A wine club subscription is a clear indicator of someone who is in the middle class.
10) They need an Emergency Fund
47% of Americans don’t have four hundred dollars available in cash to pay, in case of an emergency,
based on a research in The Atlantic. Most people in the middle-class category despite
living a comfortable life, they have established a lifestyle where they survive paycheck to paycheck.
In case of an emergency they wouldn’t know where to get fast money.
Their credit card would probably be the last resort. The emergency wouldn’t need
to be a serious medical emergency but something as simple as car issues such as requiring new tires.
Not having an emergency fund, is one of the most dangerous positions
anyone could ever put themselves in. It is important to have enough funds aside to
cover at least three months of expenses in case you lose your job or need time to transition.
Wealthy people have enough savings to cushion them during emergencies.
09) Knock-off clothes Middle-class people love designer brands
but they can’t afford them. They want to show-off and appear to be richer than they actually are.
Since they can’t buy them they resort to buying knock-offs. The fake versions of the designer
items are often of poor quality. They simply want to appear to be rich. Research indicates that 90%
of all the louis Vuitton merchandise in the US are fake merchandise.
The wealthy upper-class people wouldn’t buy fake designer items because they value quality.
They can tell when something isn’t real as they know all variations of the designer items.
Also, they only purchase items from specific locations and are very keen
to ensure they are verified designer outlets.
08) Middle class watch Reality Shows
Based of research conducted by The Wrap, the middle-class people enjoy watching
realty shows such as The Bachelor, MasterChef and Americans Got Talent.
People in the lower-class categories, love watching reality shows like Jerry Springer,
Judge Judy and the likes. They prefer the shows full of fights, drama and shouting matches.
Research conducted by Frank N. Magid Associates indicates that 40% of citizens who watch daytime
shows make less than $20,000 annual income. 85% of them don’t have a college degree. Extremely
wealthy people on the other hand read books more than they watch shows on television.
07) Social Media Addicts People in the middle-class category
use social media daily. They have to always update their social pages. While it’s a channel
through which they interact with their friends and family it’s also a measure of their value.
The middle class evaluate the number of likes and followers to their value.
Comparing the rate of interaction on a social media page and trying to get the
highest number of likes is no way to create real happiness. Real joy can only be derived
from building healthy relationships and not from validation on social media.
Rich people don’t need any validation from social media. They are rarely online and
will only use their social media accounts to build an audience to market their brands.
The upper-class citizens are very bust with their own lives, that they don’t have
much time for social media. Sometimes they even hire someone to manage their accounts.
Their confidence comes from their achievements and won’t seek validation from online platforms.
06) Healthcare is Expensive Poor people often qualify for Medicaid
which provides free medical care. Most people go through their lives with free medical care as long
as they’re poor. However, as soon as they make some money and enter the middle-class category,
they are forced to start paying huge premiums for medical care.
The costs are even higher for people who are self-employed without an employer to cover
their costs. The insurance premiums can be as high as a couple of hundreds of dollars.
According to statistics, one of the main causes of bankruptcy in the US,
is high medical bills. The rich don’t face such problems as they have extensive
insurance covers that cover all their costs. The middle class can’t afford
these high premiums as they are busy buying luxury goods they don’t need.
05) They Rent Their Homes The middle class consists of people who rent and
own houses, but if you hear someone rents their home, chances are they belong to the middle-class
category. Pew Research Center uncovered that the demand for rental spaces has grown significantly
since the 2008 financial crisis. Close to 43 million Americans rent their house or apartment.
People who live below the poverty lines or within the lower class,
have to resort to living with many roommates to split rental bills. Many others are
forced to live with their parents or relatives. The wealthy not only have one home, but a couple.
They believe renting a house is a waste of money. To them, owning a home that you can sell later at
a premium is a worthy investment. They would rather take up loans to purchase such assets.
While renting is suitable for a short while,
over long periods it prevents one from acquiring building equity.
04) They Value Credentials The people in the middle-class
values someone’s credentials over the amount of money they make. For example, a lecturer
with a PHD earning $30,000, would be ranked higher than a plumber earning $70,000 a year.
The plumber would be considered a “blue-collar” or “working class”.
Despite the professor not earning as much as the plumber, and possibly struggling with some bills,
he/she would be considered middle class and the plumber based on people’s assumptions wouldn’t.
03) They followed a traditional path
A higher percentage of people living in the middle-class
category have a traditional 9-5 job, a substantial salary,
basic health insurance, vacation time, and intend to retire at the retirement age.
Their parents probably went through this path and they also intend to follow through with it.
There is nothing wrong with choosing this path in life. In fact, it’s the safest means
to avoid poverty. However, the safest means isn’t always the best means. It’s hard to
become wealthy through the traditional way. Most people only become financially stable
through following other paths in life. 02) Use of Streaming Subscriptions
The middle class always have streaming services subscriptions such as Netflix,
Amazon Prime and Hulu. They would rather have the convenience of always being able to access
the entertainment provided at any time. It’s great but there’s a downside. Using
these streaming platforms is addictive and keeps the middle class from being productive
and spending quality time with friends and family. Most wealthy people hardly watch television.
01) You Buy the Latest Apple products When someone is always upgrading their
tech devices, just to stay in trend then they are definitely in the middle class. Most purchase
these gadgets not because they have to or because theirs is damaged, but simply because they can.
It’s obvious that people in poverty can’t afford the newest iPhone when it’s released,
their current phone was probably released a couple of years ago. It’s the middle
class who are wrapped up in the facade of purchasing a new gadget whenever its released.
They are simply in search of the notoriety of being able to own the latest device.
You would assume that the rich always have the latest of everything, however, this isn’t true.
Millionaires and billionaires know when to spend money. They often buy a good device
that has great features and will last a few years before they make the next purchase. To be honest,
is the difference between iPhone 12 pro max and 13 pro max so significant?
So, with that said, do you think you belong
to the middle class? Or does this description fit someone you know?
That’s it for today, thank you for watching. If you enjoyed the video, don’t forget to leave
a like and subscribe if you haven’t already. Have a great day, and see you in the next one.