As one of the leading financial consulting firms, we work with clients from a variety of different financial classes. It seems like, today, the middle class is a vanishing breed. The idea of success years ago was a house with a white picket fence, two children, and a nest egg to go on vacation every year. While it might be a bit different today, the lifestyle benchmarks that define middle-class success remain the same.
Here’s the top signs you’ve made it to the middle class.
Financial Consulting Firms Weigh in on How to Know if You’ve Made it to the Middle-Class?
What is middle-class? Definitions have been flying for years. From people earning 20% of the average income to those earning 80%, it seems like everyone is claiming to be part of the middle-class these days. Even some millionaires say the same. While there isn’t an official standard, the middle class is characterized in terms of 6 financial benchmarks.
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Home Ownership
This is still the American dream. From living at home or renting to owning your own home, this big step signifies true achievement. Since median home price ranges differ across the country, the ability to achieve this benchmark varies.
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Car Ownership
Owning a car outright gives you the freedom to travel and get where you need to when you want. While the cost of cars varies, just like the price of homes, the possibility to own your own car will depend on the kind of automobile you purchase. You might be able to purchase a BMW while your neighbor might only be able to purchase a KIA.
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College Education for Your Kids
Helping your children get ahead in life is probably the primary goal of your family. If your children choose to go to college, paying for that education can be expensive. It takes most families years of saving to be able to afford to send their children to college. Prices range from the low tens of thousands of dollars to hundreds of thousands of dollars.
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Retirement Security
Saving for retirement is also an important factor for most middle-class families. Achieving retirement demonstrates success and provides a reward for all your years of hard work. The amount of money you need to save to support your retirement will also vary. Factors include where you live, what your lifestyle is, and the cost of living.
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Health Care Coverage
The ability to obtain healthcare coverage is a goal for most wage earners, especially those in the middle-class. The high costs of medical care and prescription medication continue to increase, leaving most families looking for health care coverage. It’s an essential financial benchmark for those looking to avoid the negative financial implications that come with illnesses and injury.
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The Ability to Go On Vacation
After you’ve got the house and the car, you’ll be most likely to desire a yearly vacation. The family vacation is a middle-class staple. This demonstrates that you have disposable income and have been successful enough to enjoy time away from work to relax and unwind. If you’re planning a vacation every year, you’re likely a part of the middle-class.
To achieve middle-class status, most families are two-income homes. Achieving middle-class goals is becoming more and more difficult as employers do away with pension plans and medical benefits. The cost of healthcare and education doesn’t help either. While there are significant challenges for those looking to achieve middle-class success today, it’s not impossible.
When you take the following proactive steps, you can achieve financial freedom and help make your dreams a reality:
- Create a budget for your household
- Understand what money comes in and what goes out
- Work together
- Live within your means
- Plan for emergencies
- Plan for the future
- Look for cost-savings opportunities
- Pick up a second job if possible
For all your financial questions, talk to a money management consulting firm to make the right decision for you and your family. They will help you achieve your financial goals and live the life you deserve!
