![]() In 2019, the middle class was spending about $4,900 a year on out-of-pocket health care costs. Yet these increases largely just keep pace with inflation, not the actual cost of living.Īt the heart of this question is the heavy, confounding issue of American middle-class identity and the psychological and social wreckage that comes with losing itīasic costs are taking up bigger chunks of the monthly middle-class paycheck. Most middle-class Americans seem to be making more - getting raises, however small, sometimes billed as “cost of living” increases. It’s also increasingly expensive to be middle class, in part because wages for all but the wealthy have remained stagnant for the past four decades. They’re just taking on massive loads of debt to do so.Īs journalist and social critic Barbara Ehrenreich has pointed out, it’s very expensive to be poor. Before the pandemic, they were (and largely still are, absent a layoff) buying and leasing cars, purchasing homes, going on vacation, covering their kids’ education and activities. It’s difficult to tell if someone’s part of the hollow middle class because they’re still performing all the external markers of middle-classness. The stability that once characterized the middle class, that made it such a coveted and aspirational echelon of American existence, has been hollowed out. Now, it mostly means the ability to put your bills on autopay and service debt. It meant the ability to save and acquire assets. But those positive economic indicators obscured a larger reality.įorty years ago, the term “middle class” referred to Americans who had successfully obtained a version of the American dream: a steady income from one or two earners, a home, and security for the future. ![]() Unemployment was low consumer confidence was high the housing market had “recovered.” In 2019, 95 percent of people in households making over $100,000 a year reported they were “doing okay” financially, a 13 percent increase from 2013. Pre-pandemic, middle-class Americans modeled the belief that everything was fine. “I’m resentful of my partner for not making more money, but more resentful of his crappy employer for not paying him more.”ĭelia is part of an expanding group of people whose income technically places them within the middle class of American earners but whose expenses - whether for housing, medical costs, debt payments, child care, elder care, or the dozens of other expectations that attend supposed middle-class living - leave them living month to month, with little savings for emergencies or retirement. “I don’t feel like I’ll ever have a day that I won’t be worried about money,” she said. Going on vacation has meant juggling costs on several credit cards. So why does Delia feel so desperate? She’s able to put $150 a month into a retirement account, but the family’s emergency savings account hovers at just $400. To most people, $160,000 sounds like a lot of money. ![]() (According to the Pew Middle Class Calculator, Delia’s household income places her family in the “middle tier” along with 49 percent of households in the greater tri-state area.) Their $160,000 combined family salary places them firmly in the American middle class, the boundaries of which are considered to be two-thirds of the US median household income on the lowest end and double that same median on the highest, and adjusted for location. “Or so I thought.”Īs a teacher in New Jersey, Delia, age 41, makes around $115,000 a year her husband, who works as a carpenter, makes $45,000. “We followed the traditional path to middle class and economic security,” she told me. She went to college, she got a teaching degree, she found a reliable job, and she got married.
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