Posted on 11/26/2023 5:06:56 AM PST by davikkm
An intriguing shift is observed among almost a third of millionaires in the U.S., who now identify themselves as part of the middle class, according to MoneyWise. A Bloomberg study further reveals that 25% of America’s “regular rich,” earning at least $175,000 annually, perceive themselves as “very poor,” “poor,” or “getting by but things are tight.” This surprising self-assessment raises questions about the sustainability of such economic dynamics.
Simultaneously, the housing market paints a challenging picture. Monthly mortgage payments, hitting unprecedented levels near $3,000, are contributing to historical highs in the US housing market. The perception of a $1 million home has evolved, and currency devaluation is evident. Real assets surge in value, primarily driven by the declining worth of the dollar, while incomes struggle to keep pace with rising housing costs. The financial stressors are attributed to inflation, increasing expenses, interest rates, and student loans, emphasizing the growing economic disparities.
(Excerpt) Read more at citizenwatchreport.com ...
Link is incorrect
As a retiree, I am OK with a high income and low expenses. If you are a married couple with young children living in an expensive area, yes, you might need a lot of money. But once you have a paid-for house, and only yourself to take care of, you can do quite well.
If I recall correctly the vast majority of Americans over decades have considered themselves “middle class” even if they were technically poor or fairly rich. It’s probably why Marxist eventually switched to race batting since class warfare wasn’t as successful as they hoped
” Rich Americans Claiming Middle Class Status Amid Soaring Inflation.”
What a coincidence. A lot of the folks who use to identify as middle class are now in the poor class thanks to Bidenomics. That was the Democrats plan from the start.
I think this is correct. My salary is a solid six figures, but has not kept pace with inflation. Many of the things I rely on have doubled or tripled in price over the last few years. Things like groceries, transportation, utilities, health care and taxes have skyrocketed. I have always bought new cars, but have balked at paying over $40K for a car.
It does help that I have a low interest rate mortgage, my kids have moved out and interest rates on CDs have improved. But I have given up on the idea of early retirement. Once I starting taking money out of my 401K, I’m going to lose about a third of it to taxes right off the bat.
I know quite a few people younger than me who are in, what I would call, desperate straits. However, they do not see it that way and have come to regard what they are doing as routine (even though it is not).
Basically, they are relying on credit cards to make ends meet. Their primary strategy is to constantly shift balances from one card to another (to keep interest rates manageable). I have to tried explain to them this is not a good long term strategy. However, I just get blank looks from them.
So you're saying that young married couples who have a young child - and are perhaps planning on having one or two more - need only tighten their belts for approx. a quarter of a century.
Thank you for your invaluable insights!
Regards,
In some parts of the country, you might maybe just possibly barely be considered “upper middle class”, but with bidenflation you won’t even be that in another week or 2.
Yikes! I do hope you realize that a solid six figures makes you one of a small and fortunate few?
Sorry, here it is:
https://citizenwatchreport.com/rich-americans-claiming-theyre-middle-class/
In my younger days I was deep in debt and broke—and played the games with credit cards.
I knew I was in trouble—and the Dave Ramsey approach helped me find my way.
It took several tough years to turn it around but it was worth it.
However—I was single and not responsible for others.
Married folks with kids in that situation are going to have a lot tougher time when (not if) the economy goes south on them.
It is a real wake up call when you realize that nobody else really cares—and you are on your own.
Thanks for the excellent article.
If you look at housing costs the average metro area California house costs five times as much as the average West Virginia house.
Many of those high salaries are in high cost of living areas where huge mortgages are rule rather than the exception.
100K in West Virginia is great—in Los Angeles you are poor.
I think everybody knows that.
I am involved in some personal finance discussion groups on the web and while folks generally get that high cost areas are more expensive than low cost areas they are often not familiar with the details of the numbers.
I tell young people if you are broke and want to stay broke for the rest of your days stay in high cost areas....the numbers say that higher wages do not even begin to compensate for the cost of living in those areas.
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