A family earning between $32,048 and $53,413 was considered lower-middle class. ... What Is a Middle-Class Income? Income group Income Lower-middle class $32,048 - $53,413 Middle class $53,413 - $106,827 Upper-middle class $106,827 - $373,894 Rich $373,894 and up 1 more row
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Understanding where you fall in the American economic class system isn't as simple as pulling out a calculator or looking at a pay stub.
Myriad forces shape individuals' economic class and their views on where they rank alongside other Americans.
When asked how they identify their social class, 73% of Americans said they belonged to the middle or working classes, according to an April 2022 survey from Gallup. Fourteen percent identified themselves as as upper-middle class and 2% categorized themselves as upper class. In determining their social class, people often don't just think about income, experts say, but about other factors, including education, location and family history.
When it comes to defining the middle class, Gallup senior editor Jeffery M. Jones says, "It’s more of a feeling. It’s about economic security, being able to afford what you need but then also maybe a bit beyond the basics. Maybe vacations, something extra recreational, a third car, money to do things beyond what you need to live."
Larger economic trends may also impact how people view their class rank.
In recent years, economic trends such as high rates of inflation, waves of employee resignations, struggling small businesses and other effects of the coronavirus pandemic have impacted the wealth and health of workers and businesses. However, according to the Gallup survey, Americans' perspectives on where they stand didn't change from 2020 to 2022, showing that the coronavirus pandemic did not have a significant affect on how Americans view their social class positioning.
In general, much of today's political rhetoric focuses on the challenges facing the middle class. And although household incomes have risen over the past 50 years or so, it took more than 15 years for households to regain their 2000-level incomes and recover from the short-lived 2001 recession and the longer Great Recession, says Richard Fry, senior researcher for Pew Research. "The 15-year period of stagnation was an episode of unprecedented duration in the past five decades,” he says.
Meager income gains likely have contributed to feelings of frustration and downward mobility, Fry says. And while most American households are doing better than they were 50 years ago, "the gains have not been equal," he says. "Everybody’s better off, but it’s particularly the well-off who are better off."
So what does this mean in terms of where you fall in the American economic class system? Here's what to know.
Breaking Down Economic Class by Income
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One objective way some researchers divide individuals into economic classes is by looking at their income. From that data, they split earners into different classes such as poor, lower-middle class, middle class, upper-middle class and wealthy. The income cutoffs that divide those income ranges can change from year to year and between methodologies, but here's a sense of where they stand, according to recent data.
The month-to-month change in average hourly earnings of all employees has been positive so far in 2022, suggesting wages are growing, though this job-related earnings data does not account for other sources of income like retirement income.
What Is a Middle-Class Income?
Pew Research defines middle-income Americans as those whose annual household income is two-thirds to double the national median (adjusted for local cost of living and household size). For a family of three, that ranges from $52,200 to $156,600 when the 2018 incomes used in a Pew study are adjusted for inflation from 2018 to 2021, according to Rakesh Kochhar, senior researcher at the Pew Research Center.
The lowest-income group earned less than $48,500 for a family of three while the highest-income households had incomes topping $145,000 in 2018 dollars.
"As far as the first, initial shock of the pandemic, we found low-income families were most affected as far as finances are concerned. In terms of the share of people who are lower, middle or upper class, that did not shift much," Kochhar says. "There were other factors in lower-income families other than the financial bit – a third had some experience with unemployment during the course of the year, which was again much higher than unemployment experienced, but there also was on the other hand a lot in terms of government assistance."
If those numbers have your head spinning, here's a breakdown of income and class for a family of three:
Income group Income Low income Less than $52,200 Middle income $52,200 - $156,600 Upper income More than $156,600
Pew has developed a calculator to determine income class, into which you can plug relevant financial, geographic and household information for a take on where you rank.
According to 2019 numbers run by Stephen Rose, a nonresident fellow at the Urban Institute and research professor at George Washington University, the range for a middle-class family of three was an income of $53,413 to $106,827, he says. That same three-person family with an income between $0 and $32,048 per year was considered poor or near-poor. A family earning between $32,048 and $53,413 was considered lower-middle class.
For high earners, a three-person family needed an income between $106,827 and $373,894 to be considered upper-middle class, Rose says. Those who earn more than $373,894 are rich. "In my mind, there's a big divide today between the upper-middle class and the middle class," he says.
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Some of that divide is cultural, Rose says. "The middle class feels like they're missing out and they feel talked-down to" by the upper class, he says.
Here's a breakdown on income class for 2019 incomes for a family a three, according to Rose's analysis:
Income group Income Poor or near-poor $32,048 or less Lower-middle class $32,048 - $53,413 Middle class $53,413 - $106,827 Upper-middle class $106,827 - $373,894 Rich $373,894 and up
Am I Middle Class?
Whether you're considered middle class depends on more than just your income or the balance of your bank account. Where you fall in the American economic class system may not stay consistent throughout your life, or even from year to year, experts say.
For example, a law student may earn a modest graduate student stipend of $20,000 per year, currently placing them in the low-income class, but educational attainment and future earnings will most likely catapult their income and class placement to a higher level down the road. "People really need to understand that whatever's happening (with their class rank) today is part of a trajectory, part of their life," Rose says.
Other Factors Helping Define the Middle Class
How a person perceives their own social class extends beyond what a W-2 income form claims they earn, experts say.
"Class is more than just income," Kochhar says. "What doesn’t change is your education level, your occupation or the neighborhood you live in."
A factor that individuals may use to determine class is educational attainment, with people who have postsecondary degrees linking their class placement to those degrees. Your location also has a major impact on how you feel you stack up class-wise.
Awaken your dormant DNA ability to attract wealth effortlessly
The simple yet scientifically proven Wealth DNA method laid out in the report allows you to effortlessly start attracting the wealth and abundance you deserve.
Awaken your dormant DNA ability to attract wealth effortlessly
The simple yet scientifically proven Wealth DNA method laid out in the report allows you to effortlessly start attracting the wealth and abundance you deserve.
Affluent Savvy
Photo: Ksenia Chernaya
