What is the mindset of middle class people that keep them middle class?

In My Humble Opinion
81

I’ve definitely witnessed first hand why my future MIL, who should by all accounts have at LEAST 5 years worth of savings to live on only has six months’ worth, despite being a tenured professor making 80k/year and owning her home free and clear. It’s mind boggling, but here’s what she does:

  1. Buys a new car, every 5 years. When the old loan is done, new one is in. This BLOWS my damn mind.
  2. Goes out to eat often. You can’t even argue it’s because she works too much; for God’s sake she’s a liberal arts professor. If she works 40 hours a week, it’s remarkable.
    2a) Goes out to full priced movies, popcorn, etc. We told her about the $1 theater just 15 minutes from her house, and she STILL goes out for full priced movies.
  3. Not maintaining her home herself, instead letting it wait until she needs a professional then LOOKING IN THE PENNYSAVER FOR SOMEONE. This is stupid. I have no reasoning behind this one.
  4. Not networking. I didn’t realize how much my parents (and I and my SO) network for stuff. How the hell do you know your roofer or your plumber or your painter will do a good job and fairly priced if you pick him outta the damn book? Ask your colleagues, friends, relatives, service people, your kids’ teachers, ANYTHING but doing it blindfolded. She sees this as asking for help.

Here are the three WORST though:

  1. Buying stupid gifts that people didn’t ask for all year round, rather than one gift for Christmas and one for birthdays. My SO’s little sister just turned 8. She got - literally, I shit you not - two laundry baskets full of gifts. It was stupid, it was gratuitous, and it was very wasteful. She gets those idiotic Build A Bear things seemingly every month. My SO asked for cash, she refuses. Shopping is recreational to her, and she wants to give the kids what she never had.

  2. Thinking all debt is the same. This is a HUGE problem for her. I tried to talk to her once about how there’s good debt and bad debt (she was discouraging my SO from taking out law school loans from a top 10 school) and how, for example, car loans = bad debt and school debt in a proven field = good debt. She told me she paid off her student loans quickly (stupid, stupid, stupid!) whereas I said she should have put that $ into something that would yield more than the low student interest. She didn’t get it, she said that she wanted it “off of her mind”. Unfortunately, that’s just emotion talking.

She took out LOANS to pursue adoption - also really, really mind-blowingly stupid. Of course, I’ll never argue this point to her face. She already had my SO and was a single parent, adopting was none of her goddamn business.

My SO tried to explain to her that once the kids were out of school that she should move to a neighboring borough (5 minutes away, even closer to work) to save money on taxes and have a cheaper (but not smaller or any less safe!) house. She refused - she thinks she deserves a certain lifestyle, that the neighborhood is who she is - it’s a very upper-middle class neighborhood with cobble stone streets and trees. Groan.

6a) Her home is only paid off because her father bought it for her. She will inherit nothing, because he failed to diversify his investment portfolio, and she failed to do so with the stock gifts he gave her. (I didn’t want anyone thinking she’d somehow been responsible by paying off her home).

  1. Buying too many items, especially food, in bulk from Costco and then throwing most of it out. We were cat sitting all week for her, and I was making dinner for the SO and myself. I threw out at least 5 jars of old spices (she already had newer replacements that were open towards the front of the cabinet) that must have been worth $50 easily. She’s thrown away mayo, canned goods, 5 pound bags of carrots, giant tubs of lunch meat, you name it. I know why she does this - my uncle does this too - you grew up lower-middle class and were hungry at times, now you want to fill your house with food. But my uncle is a millionaire several times over and she has 6 months of savings. STUPID STUPID STUPID!!
82

I respect this. Because that thread irritated me too. Not just because people fail to see their own ‘‘stuckness’’ but because I think poverty is a systemic problem, not a failing of the individual. People make certain choices because of the influence of their environment. There’s only so many strikes you can have against you before it becomes statistically unlikely that you will achieve financial mobility.

And I kind of feel the same way about the middle class. The middle class is because it has to be. It is possible to live middle class and be quite comfortable (for now… wages have been stagnating for about 20 years, so if that trend continues, it’s only a matter of time before the middle class become the new working poor.)

I’m sort of like you, in that I came from the working class and had to bust my ass to succeed. But I pursued a different brand of success. More than money, I just wanted happiness. I just wanted peace. Through a combination of genetic gifts, hard work, perseverance and pure luck, I got the opportunity to do anything I wanted. Because of my well-rounded academic ability I believe I could have done just about anything with my life. If I really wanted to work 70 hours a week and make six-figures, I could. But I chose a career that would be more rewarding than lucrative. I care about the meaning of my work. I don’t want to do it unless I would do it for free, you know?

Because I am one of those people who can get so caught up in the game. I can be competitive and full of hubris and all Keeping Up With the Joneses. I can be so into myself and my accomplishments and my goals and my destiny. I can be such a fucking drama queen, never feeling good enough, always having to be the best, blah blah blah. But when I do community work, when I focus on service, all that shit just fades into the background and I find more fulfillment than I could even describe. I’m just a happier and better person this way. This is success for me.

Although we’re really not hurting financially, either. You acknowledge that wealthy people often don’t appear wealthy, but you are overlooking the fact that middle-class is generally defined by income and wealth is generally defined by assets. They are two totally different things. As a pair of grad students, my husband and I are doing pretty crappy in the income department (in the negative, actually!), but asset-wise we’re doing all right. And financial success to us is about building assets and wealth, something that can be done with even a moderate income. My concern is not with upward mobility, it is about maintaining financial stability at our current standard of living until the day we die, and passing on whatever’s left to those we leave behind. As long as we have that, I’m happy.

And if you really want to know my opinion on the fundamental difference between the poor, the middle class, and the wealthy, it’s this: A very few, fortunate, hard-working, gifted people achieve financial mobility, but the vast majority of people who turn out wealthy do so because of the lottery of birth. My husband’s father comes from serious money. If it weren’t for that, maybe the best we could ever expect is a comfortable retirement (and if that’s what does happen, fine. That’s all I wanted.) But in the past 5 years, we’ve received two large monetary gifts that have helped us get ahead through wise investment, and there’s likely an enormous inheritance somewhere down the line. Whatever we did with that money, whether we grew it or squandered it, it would be downright insulting to imply that the outcome was something we earned. My children and my children’s children will likely have much greater opportunity because I just happened to fall in love with a man whose grandparents are billionaires. That’s the reality of wealth in America.

83

Did you mean adoption was none of your goddamn business? Because I can’t really figure out how it wouldn’t be her business.

ETA: I can’t figure out a way to phrase this without it sounding snarky. I judge my MIL’s decisions all the time if it makes you feel any better!

84

Wow. I don’t do any of that stuff, and I consider myself fully middle class. It sounds like you’re describing stupid people or working class.

As many many others say:

and

and

Most Americans do think they’re middle class, because being “working class” has a social stigma, although it would more accurately describe them. That’s okay, because politicians constantly talk about the “American middle class” such that the working class don’t realize their station in life.

Which is quite the opposite of my experience. What class do people in your experience claim that they belong to?

Well, “wealth” is definitely a measure of “worth,” but that’s not really indicative of social classes. In my area, and income of $100k is definitely a middle-class income. Maybe they don’t get ahead because they’re wasteful, and maybe they’re uncouth, but we’d still have to consider them having a middle class lifestyle. Why can’t the middle class accumulate wealth, though? Maybe we need to define middle class as a “lifestyle” rather than both income and wealth?

Maybe higher. I fully expect to have $1m by age 50, and if the economy recovers, perhaps something significantly more. But that’s not real wealth. That’s small change in the big scheme of things, and it should only really be enough for a comfortable retirement. (Those are real dollar figures, not today’s figures adjusted for expected inflation.) That’s middle class.

I’m tired of all of my relatives telling me, “oh, it must be nice that you’re so rich.”

85

I’ve read MOST of this thread, but I’m not sure my philosophy has been brought up yet.

The Wife and I made VERY Good Money. We had LOTS of discretionary income. We have some savings, we don’t really live within our means. We don’t have a LOT of debt, but we have enough that some folks here would look down their noses at us.

We were rather upwardly mobile about 10 years ago…then the following happened:

  1. The economy tanked
  2. We had twins (What is it, $256k per kid to raise them to adulthood?)
  3. She went through a number of rotten jobs, culminating in a nervous breakdown and therapy.
  4. My Government job changed GREATLY in responsibility (I’m an Officer), but the pay doesn’t reflect it. There’s been 2 COLAs in the last 8 years, and I make the same dollar amount (not adjusted for inflation) that I did as a webmaster in 1996.
  5. We now use my Health Insurance, which is crummy and expensive.

On the PRO side of the equation:

  1. We purchased a great big house 10 years ago and have stayed put. Sure, it’s not worth as much as it has in the past, but the mortgages are fixed, and it’s an appreciating asset, if only slightly, and it’s got a nice chunk of equity in it.
  2. We have 5 cars, 3 are paid off, and the remaining two cost less than a good, new, fully-loaded SUV. Four of the cars are Great Fun, the fifth is the heavy lifter. I drive 2000 miles a year.
  3. My wife has a pretty nifty Permanent Part-Time job in her career field (software developement), it lets her work 6 hours a day Monday-Thurdsay and have Fridays off. Sure, it’s a $50k a year hit in income, but the WHOLE family is much happier as a result.

We have about 3 month’s savings if a crisis hits…we used to have more, but hey, things have been kinda tough lately…and we have things (like the cars) that could be converted if need be. I may not be making any MORE money, but at 39 hours and 59 minutes, I walk off the job and leave it there.

I’ve known rich people. They were VERY willing to make some ethically questionable decisions because they were fiscally wise.

I’ve also known people that STRIVED to be rich and FAILED. So instead of a retirement with 5 Mil in the bank, they have $120k to their name and are working part time. You make do with what you’ve got. Watching them has made me risk averse.

I can see my retirement being a Paid off house, a pension that pays for 3/4ths what we want to do, and a part time job that keeps me moving and my mind active. I kinda like that.

86

:dubious:

Which is?

87

Sorry, I didn’t explain that well at all. I meant that I’d never argue it to her face, that it’s not my business but it was a stupendously stupid decision to adopt as a single parent who already has a kid (my SO, biological) if you have to take out loans to get them (which she did). Taking out the loans was stupid; if she couldn’t afford it, should have saved up. I would have been a lot more sympathetic to her adopting with a loan if she didn’t already have kid or if she couldn’t have kids, but that wasn’t the situation. She is still paying off those adoption loans over 10 years later.

88

[quote=“olivesmarch4th, post:82, topic:550255”]

A very few, fortunate, hard-working, gifted people achieve financial mobility, but the vast majority of people who turn out wealthy do so because of the lottery of birth. QUOTE]

According to Thomas J. Stanley’s book “The Millionare Next Door”, the opposite is true. 80% of millionares are first generation.

**BigT **and Lamia, I cannot help if you are oversensitive and feel “offended” by either thread. But based on the responses in both threads, it seems that there are enough people who are interested in having a serious discussion on the topic.

The reason people tend to get offended by discussions of money or socioeconomic class is that they have a natural tendency to ascribe their own personal traits to their successes and outside forces to their failures. In reality it is a combination of both. You can’t help if you are born with or without money, however you can help some of the decisions you make.
The difference between being “poor” and “middle class” is that poor people by definition are unable to meet many of their basic financial needs (housing, food, clothing, education, transportation and so on). For the most part, the middle class tends to be comfortible. They have the luxury of saying “I make enough money to be happy. I don’t really need any more.” The poor don’t have that.

89

You seem awfully touchy for someone who’s accusing others of being oversensitive. I’m not interfering with your thread in any way, and I can’t help it if you get upset about my calling it “offensive” here.

90

I agree with most of what you’ve said except perhaps for this. If you only spend enough money to just get by, and put all the rest of your money away for the future, then ultimately the money doesn’t do you any good. Of course, the other extreme, of buying whatever you want regardless of the consequences to your debt doesn’t make sense either. Finding the proper middle ground can be tricky and mitigated by plenty of factors.

You also seem to be creating a false dichotomy between ‘getting into massive debt and living beyond your means’ and ‘being wealthy’. There are plenty of people who are completely debt free, and save/invest wisely, and that’s why they are middle class instead of poor. No matter how well you live within your means, if your means are tiny, you ain’t getting rich.

Then of course, there’s the idea that being ‘rich’ isn’t about money. People may be more concerned with the task of figuring out how to be happy in life, than about having the best stock options.

And, most obviously, you might have been lucky with your investments, but there are a shitload of people who recently lost a huge chunk of their investment money due to the BS going on in that particular area of our economy lately…

91

You are a perfect example of the “rich is richer than me” argument. Comfortable to me means median income, median wealth, which is so far away from 100k/year with 2mil in assets that it can’t even see it in the distance.

92

Going back to the Op’s original post:

In my case, the economy screwed me. I have the job I have because I thought the market and pay would be higher. I was wrong.

93

humm - ok. It really is a semantic thing though - both my husband and I work. We have a mortgage. We can buy ourselves nice things once and a while but not everyday. We don’t worry particularly about money but still have bills to pay. To me, that’s comfortable. YMMV, obviously, but because my opinion is different than yours doesn’t mean mine is wrong. Your post seemed to have a bit of a sneer to it; however, Im not feeling that good so I may be projecting. :slight_smile:

94

Six to 12 months living expenses comes out to $8-16,000. My expenses are rent, food, internet, gas, electricity, DirecTV, and my cell phone. I have about $5k in credit card debt. I live alone, and I do not have kids, pets, student loans, a mortgage, or a car.

If I went into hardcore money-saving mode and cut everything except rent and food, I’d save about $3k per year. Which means that at my barest of living standards, it’d still take me 3-5 years to accumulate a 6-12-month safety net.

One day, I may find myself in a situation where I need that kind of safety net and I’ll wish that I had lived at my minimal comfort level to get through that time. I might also never see that day. I might also need a sum of money that I’ll never see in my entire lifetime. Who knows? So I’m doing what I can-- living modestly, saving as much as I can, and allowing myself little pleasures-- even if it locks me into my middle class existence forever.

95

One of the things I NEVER hear mentioned in these debates is Unemployment Insurance. In my case, that’s the difference between 3 months of air-supply, and the ability to go it as long as UI holds out and not touch our savings. If the family member involved receives UI, then the family has a year or two before having to cut muscle with the fat. That pretty much means: “If you can’t stand your job, you’d better have another one lined up before saying ‘I quit.’”

96

To accept that their label is “working class” and not “middle class.” I specifically don’t mean “stationary,” stay there, accept that you’ll never do better (I grew up poor). There should be no shame in the label “working class” but (a) no one wants to accept that that label applies to them, and (b) governments don’t want insult people and so perpetrate the myth that anyone below middle class is poor, and (c) one could make the argument that I am in fact “working class” rather than “middle class.”

97

Well that goes right back to how we define ‘‘wealthy.’’ I imagine the average middle class person would have the resources to become a millionaire by retirement, but I don’t consider being a millionaire rich, I consider that covering the bases for retirement. If someone retires at 70 with a cool million and dies at 90, they have $50,000 a year to live on… a middle-class standard of living. And that’s assuming you die at 90. If not, you’re fucked.

But currently the statistical likelihood that someone will rise from the bottom of the heap to the top* or vice versa* is about 3-6%.

From here.

FTR, the population segment that seems to have the greatest amount of social mobility is that portion living in poverty. Most people living in poverty stay there temporarily, swinging in and out as their employment conditions change (swinging into lower-middle class, not millionaire status, of course.) However, our current poverty line was calculated in 1964 and is based upon the rule of thumb ‘‘the cost of groceries x 3.’’ It doesn’t compensate for the rising cost of living, health care, or a number of other expenses that are essential over 40 years later. The current poverty line for a family of four is about $22,000 annual household income. Were that poverty line to be adjusted to reflect current economic conditions, it’s probable that poverty wouldn’t be such a statistically temporary situation. Our current poverty rate is about 12%, with children making up half of those. 33% of the nation’s children live in poverty. Using a 45 year old poverty line. So I would argue that people are even less upwardly mobile than the statistics indicate.

98

That game can be played the other way as well. You are immeasurably wealthy compared to Sven’s friends in Cameroon or the poor of Mexico City. And I am terribly poor compared to Bill Gates. Median income can change drastically depending on the population we select to define median. If we choose the population of the world. Americans are almost universally wealthy. If we choose “people who summer in the Hamptons” I suspect Alice is terribly poor and they’d feel sorry for her.

We got that a little upthread with Postariti’s story. Central Arkansas is apparently not the place to be a programmer. I’ve seen the sloppy bad ones pull $100k in the Valley (no jobs now, though, sloppy programmers making six figures did not make in through 2001, much less 2008.) - of course, the cost of living in the Valley is a lot higher than in central Arkansas. I believe there are not many $100k jobs in central Arkansas.

99

I think the cost of college is an egregious burden for a lot of middle class Americans. Unless you get really good scholarships, there are far too many degrees that will rack up more debt than the jobs they lead to are capable of paying down.

Add to this natural human susceptibility to advertising, and the youth and optimism of people who are starting degrees, and you end up with kids spending $40K a year to get a degree in English. Or philosophy. Or general biology. It’s hard to convince them that for these things, a community college degree is going to end up being every bit as useful as a state or private college degree… or alternatively, that they can join a book group and a writer’s circle and learn every bit as much as they will in college English classes.

Learning for the sake of learning is great, but kids shouldn’t be encouraged to pay big tuition just to do it. Guidance counselors need to focus HARD on the cost of the degree versus the income it will bring in and the cost of repaying student loans. And pie-in-the-sky professors need to stop giving kids big, unrealistic ideas about their career potential…

It seems like something about the current system is going to have to change, soon. Either high school degrees will have to start counting for something again, or there need to be government subsidies for applied degrees, or universities need to charge less for arts & sciences degrees… something like that.

100

Well, these folks are living beneath the poverty line. It is a choice for them, however, since they aren’t “children of poverty who don’t know better.” And the point I was trying to make is that when we judge the middle class for not being upwardly mobile and then judge the poor for not being upwardly mobile - not everyone wants to be upwardly mobile. Some people are happy living on other people’s couches while the travel with an obscure folk band, or out of the back of their van while they sell art - other people are happy with jobs where they put in 40 hours a week and go home to modest middle class lives - other people are happy striving for material success.

There are a few things that are distressing though. One is people who would like to be upwardly mobile - middle class or poor - who think it was all luck (and there IS some luck involved), or think that material success should be shared (I’m a liberal who believes in feeding and housing the poor, but I also am well aware that there is a mindset of a LOT of people that they DESERVE something more than what they’ve got, and hey, that guy over there has too much). Another is when people who have don’t acknowledge that there is luck in their situation and assume everyone who didn’t get where they got is lazy.