What Does It take to Be Upper Middle Class?

Of Two Minds ^ | 21 June 2016 | Charles Hugh Smith

[Lorianne]

What's left unsaid is much of the upper middle class is prospering due to privileged positions that are increasingly at risk of disruption ___ What does it take to be upper middle class? According to one analyst, the answer is: at least $100,000 a year for a family of three. The Growing Size and Incomes of the Upper Middle Class (Urban Institute).

http://blogs.wsj.com/economics/2016/06/21/not-just-the-1-the-upper-middle-class-is-larger-and-richer-than-ever/

The paper claims the upper middle class has grown from 12.9% of the population in 1979 to 29.4% in 2014--in essence, the shrinkage of the "middle class" is not just from households dropping down the ladder but millions of households climbing up to the upper middle class.

Not Just the 1%: The Upper Middle Class Is Larger and Richer Than Ever (WSJ.com)

While the evidence broadly supports this secular shift--the concentration of income and wealth in the top 20% increases while the wealth and income of the bottom 80% stagnates--I think the claim that 30% of all U.S. households are upper middle class grossly overstates the reality, which is it's become increasingly costly to even qualify as middle class, never mind upper middle class.

[Robert A Cook PE]

125,000.00 or more.

In the south or midwest.

Northeast? 150 to 200K.

California, WA or OR coast? 500,000.00

[lee martell]

That’s a good breakdown of it. Real Estate and state taxation , operation fees matter a lot too.

[Mears]

“Northeast? 150 to 200K.”

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Nonsense-—my kids are in that range and they are hardly UPPER middle class.

.

[grania]

It might well be that there are that many families that are "upper middle class", considering two-income families in which both adults have high salaries.

What I wonder about is how many of those families never get out of debt, with college loans, McMansions, SUVs, pricey vacations, forever credit card debt, Whole-Foods type grocery spending, etc, etc.

[Mariner]

One would be hard pressed to afford a car and an apartment in San Jose with that income.

But in Columbus Mississippi one could live very, very well.

[Lorianne]

That’s a good point.
There was a recent article which claimed that if you have $10 in your pocket and no debt you have a higher net worth than 25% of Americans.

[Buckeye McFrog]

A trust fund and an obnoxious attitude.

[Opinionated Blowhard]

I think the amount varies widely depending on where you live. It also depends on your lifestyle. If you earn $500,000 per year in some cities, you live in a 1,200 square foot condo and pay half your income in tax. A lot of people wouldn’t consider that a good life. The California real estate market turns everyone but the rich into indentured servants to the bank for their entire lives.

[Sequoyah101]

All I’ve got to say is that the very top is moving into the stratosphere and the median of the rest is moving down because few remember that not so long ago the top 5% began at a much higher number.

Almost 20 years ago about $100K was not even in the top 5%.

The bottom has fallen out for the average Joe.

[Cementjungle]

What does it take to be upper middle class? According to one analyst, the answer is: at least $100,000 a year for a family of three.

I'm not sure I would count that as upper middle class anywhere in the USA... certainly not in any metropolitan area.

[proxy_user]

I consider assets more important than income.

If you have $3-5 million in financial assets, then it doesn’t really matter if your income is only $60K, right? If money is required, you can produce plenty. At the same time, you hold the taxman at bay with an average income.

[CodeToad]

$83K? Nope. Not even close. Certainly solid middle class, but discretionary income for the upper middle exceeds even $83K, meaning they make well past $83K by several factors.

$83k happens to be the median family income in many middle class neighborhoods.

[Kolokotronis]

You can live “like a king” on that kind of money up here!

[Flavious_Maximus]

My wife and I are over the $130,000 a year threshold.

Here in Northeast Pennsylvania near the Jersey border that is most definitely NOT upper middle class.

It is barely just middle class.

[ProtectOurFreedom]

Specifically COASTAL CA, OR and WA. $250k can get you middle class there, but you may be renting forever. All three are huge states and you can live cheaply in the interior.

[HamiltonJay]

100K isn’t upper middle class anymore, other than perhaps in rural areas.

It’s middle class, but not upper middle class.

Its all relative to costs. In NYC, or Silicon Valley, you want to be UPPER middle class, can’t see how anyone with a family and kids could consider themselves there if they aren’t in the upper 300 or 400k a year minimal range.... Same in New York or DC... DC may even be higher these days.

I’d say in Pittsburgh, PA solid Upper Middle Class is upper 100s to 200k to start. You can live comfortably on less here, its a town where housing costs are not insane... but to be the “UPPER MIDDLE CLASS” as traditionally portrayed, generally looking at around upper 100s to 200 range to start having that lifestyle.

[kearnyirish2]

Here in northeastern NJ $130K is also barely middle class.

Friends that have sought better positions in the southeast are shocked by the lower salaries; even with the lower cost of living they fear it isn’t really a step up.