7 ms·

It's really not strange nor contradictory. Most people probably think of "middle class" like this: - lower class: on welfare & food stamps - middle class:

• enraged_camel 10y ago
  I'm not sure a $500k white shoe lawyer is middle class. Sure, they may work for a living, but they're also likely to have enough investments that they can just live off the interest if they wanted. I mean, $500k a year is a LOT of money, even in places like SF.
  • mattnewton 10y ago
    Eh, taxes and other expenses add up. I don't think it would be very comfortable to stop working. 500k today isn't what it was just a decade ago.
    • dlp211 10y ago
      And a 100k isn't what it was a decade ago either. While I understand your underlying point (and somewhat agree with it), how you got there was a bit bizarre. We are talking about making 500k this year, which would be obviously less a decade ago when adjusted for inflation.
    • Avshalom 10y ago
      500k is still over 20 years of working full time at target.
  • derefr 10y ago
    Given that consumption (almost always) scales with social position, I imagine people will only really consider someone "rich" when they can still buy whatever they like, for the rest of their lives without working for a living.
    • Retric 10y ago
      Bill Gates can't buy everything he might want to for the rest of his life. While people tend only think of things they can afford as reasonable expenses, there is no clear line between an iPad and paying for a Mars mission. If anything the Medean income seems like a good ballpark for enough. But, it's really hard to stop.
      • pyronik 10y ago
        Maybe so, but when its not worth it to you to pick up off the ground more than what other people make... I think its close enough to not quibble.
      • maxerickson 10y ago
        The clear line is a yacht with 2 helipads.
        • alasdair_ 10y ago
          Is that above or below two yachts with a helipad each?
        • vidarh 10y ago
          Like Paul Allen's [1] you mean? " Octopus sports two helicopter[2] pads on the top deck, a twin pad and hangars at the stern and a single pad on the bow; and a 63-foot (19 m) tender docked in the transom. There are a total of seven tenders aboard. The yacht also has a pool, located aft on one of its upper decks[citation needed], and two submarines (one of them operated by remote control for studying the bottom of the ocean).[citation needed] Side hatches at the water line form a dock for jet skis. " [1] https://en.wikipedia.org/wiki/Octopus_%28yacht%29 https://en.wikipedia.org/wiki/Octopus_%28yacht%29
  • nugget 10y ago
    Here are some numbers to consider. $500k pre-tax is about $325k after taxes (SF or NYC). Spend 50% ($162.5k), save 50% ($162.5k). After 10 years of a consistent $500k pre-tax income (no burnout, no voluntary breaks, no unemployment), with modest annual stock market growth, and no black swawns (family illness, lawsuits, divorce), you've saved up about $2 million. The rate at which you can spend money and not run out before you die (called the Safe Withdrawal Rate or SWR) is about 4% (some will argue closer to 2.5-3%). 4% of $2 million is $80k/year pre-tax. How long you need to work to cover your $162.5k/year lifestyle becomes an obvious function of savings rate and market returns over an extended period of time (decades). The bottom line is that it's extremely difficult for working professionals to become ''rich'' in the sense that they can indefinitely sustain an upper class lifestyle on passive investment income alone. Read ''The Millionaire Next Door'' by Thomas Stanley (http://fave.co/2cLN5gp http://fave.co/2cLN5gp) to learn more about how wealth is truly accumulated and managed in the United States. This book had a greater impact on me than pretty much any other I've ever read.
    • grecy 10y ago
      Which is why the number of years until you can retire has nothing at all to do with how much you earn, and everything to do with how much you save as a percentage of your income. http://www.mrmoneymustache.com/2012/01/13/the-shockingly-simple-math-behind-early-retirement/ http://www.mrmoneymustache.com/2012/01/13/the-shockingly-sim...
• nerdponx 10y ago
  Your definition of "upper class" corresponds better to my definition of "rarefied wealthy"
• infodroid 10y ago
  > middle class: have a job, must work for a living This is not the way most people have traditionally thought of the middle class. The middle class were the highly-skilled white-collar professionals: doctors, lawyers, engineers. In contrast, the lower class were the poor or blue-collar workers: farmers, factory workers, and the unemployed. Whereas the upper class referred to business owners and financiers. With the decline of farming and manufacturing, blue-collar workers shifted to service industries. What is striking is most people think they have the living standard of skilled white-collar professionals, even though they are just service industry workers. This situation is only possible because of universal access to cheap credit.
  • dpark 10y ago
    When was this ever the typical definition of lower/middle/upper class? That's not the historical definition nor is it the modern one. The idea that being a business owner makes you "upper class" is absurd. Most business owners have always been middle class. Most businesses aren't that lucrative and require large amounts of time relative to the amount of profit generated.
    • blowski 10y ago
      Actually, as a Brit (and so an expert in these matters), it seemed a fairly good definition for me. It's similar to how class is represented in Downton Abbey and in books like "Watching the English" (Kate Fox). As far as I know, there are no formal and universal definitions of the class system. Certainly in Britain, class has almost nothing to do with your income or bank balance. A lot of the upper class are completely broke, while there are many "working class millionaires".
      • exstudent2 10y ago
        Americans don't have the baggage of nobility so don't have to wedge the class system into a historical (but no longer relevant) model. In the US all that matters is money. It might come from your parents, it might not.
• netcan 10y ago
  I think to satisfy my own definition of class, it has to have some sort of hereditary component to it. Class has meant all sorts of things historically. In many ancient human societies, class is formally defined.
• Karellen 10y ago
  I heard it was: - lower class: your name is on your shirt - middle class: your name is on your office door - upper class: your name is on the building :-)
  • jondubois 10y ago
    I think that's the best description. Today with all the propaganda around 'open workspaces', white collar workers have been forced back into the lower class (in spite of getting higher salaries). Your class is more related to your self-esteem than your income. In one of the companies I worked for as a contractor, I had my own office and it felt great. When I was younger, I briefly worked in a telemarketing call center for the equivalent of $20K per year. Then many years later (after I finished uni), I was earning $200K per year in a different company (as a software engineer in an open workspace). The $200K workplace didn't boost my self-esteem much more than than the $20k workplace.
    • dpark 10y ago
      > Today with all the propaganda around 'open workspaces', white collar workers have been forced back into the lower class. This is the epitome of pampered engineer BS. You aren't lower class because you don't have a private office. $200k/year and lower class? You can afford to buy your own private office for much less than that.
      • leurfete 10y ago
        I agree that it sounds ludicrous to claim that one can be 'lower class' at $200k/year, however, I think there's a charitable way to read this position. Perhaps their point is that autonomy is a better indicator of class than salary. Just like 'stupid is as stupid does,' 'class is as class does.' Being able to afford your own office means nothing if you can't actually use it because you spend 8-10 hours a day trapped in an environment that you find degrading. The barrier to class mobility in this case is mental. The engineer has traded autonomy for cash. My own opinion is that one becomes upper class when they can choose not to work. If your living expenses are $20k/year and you make that from returns on passive investments, congratulations, you're a part of the leisure class. If your expenses are $190k/year and you earn a salary of $200k/year you're a part of the lower/precariat class.
• dahart 10y ago
  I think you've put your finger on what's interesting here: that people self-identify emotionally, using lifestyle and value judgements, and not based on actual income or statistics. The classes are most commonly defined by economists as income brackets, not as welfare vs jobs vs passive income. [1] Yet when people are asked what class they're in, they use welfare and investments as the indicator. Look at the stats and you start to see that by almost all definitions, the vast majority of the "rich" still have to work for a living, they simply have very high salaries. Passive income lifestyles are only being had by a very very few people well above the median of any "upper class" definition you can find. It's not surprising that relatively well-to-do people think they're middle class, but it also doesn't hurt to have some perspective and realize that at at household income of $200k, you're in the top 3% in the US. [2] The goal of a passive lifestyle is not and might never be a realistic definition of rich, nor a practical goal for the vast majority. -- Of course, as others have pointed out, it definitely depends on where you live. For more perspective, here are some stats on the cities used in the infographic: [In 2000] The median income for a household in [Lakefield, MN] was $31,250, and the median income for a family was $37,898. [3] The median household income in Edina in 1999 was $66,019. [4] According to a 2007 estimate, the median income for a household in [Scottsdale, AZ] was $70,533, and the median income for a family was $92,289. [5] According to the U.S. Census Bureau's American Community Survey data estimates for 2008-2012, the median income for a household in [Chicago] was $47,408, and the median income for a family was $54,188. [6] Real Median Household Income 2014: US=$53,657 Minnesota=$61,481 Minneapolis=$69,111 [7] That's over 2x variation, but most people would judge incomes of 50k and 100k very differently. *Edit: btw, kinda wierd 3 of 5 examples were from Minnesota...? -- [1] https://en.wikipedia.org/wiki/Affluence_in_the_United_States#Status_and_stratification [2] https://en.wikipedia.org/wiki/Affluence_in_the_United_States#Top_percentiles [3] https://en.wikipedia.org/wiki/Lakefield,_Minnesota#Demographics [4] https://en.wikipedia.org/wiki/Edina,_Minnesota#Demographics [5] https://en.wikipedia.org/wiki/Scottsdale,_Arizona#Demographics [6] https://en.wikipedia.org/wiki/Chicago#Demographics [7] https://www.google.com/search?q=median+income+minneapolis+mn
  • nerdponx 10y ago
    That's because traditionally class is about lifestyle, with income being either a consequence or a cause for that lifestyle depending on the situation
• alasdair_ 10y ago
  I agree. Also, they went to the Mall of America to get opinions. Malls almost by definition avoid having the extremely poor (who can't afford anything) and the extremely wealthy (who certainly don't need to go to a mall to buy things).
  • VertexRed 10y ago
    That's not true. There are always window shoppers and people that go there just to "hang out" without buying anything. The wealthy people also have to buy their clothes somewhere and they probably stick to overpriced items in brand stores (not sure if I'm using the right name, but I'm thinking of the stores where they only sell one brand) which could be locates in a mall.
• pjc50 10y ago
  Funnily enough, "have a job, must work for a living" is Marx's definition of 'working class'. The people who had no income in the pre-welfare days tended to be short-lived.
  • dalke 10y ago
    The petite bourgeoisie must also work for a living. They may be self-employed. They are not members of the proletariat, which is Marx's definition of the working class.