Most Americans say they are middle class – aspiring to an ideal that eludes definition – raising the question, “What is a middle class income?”
Most Americans say they are middle class – aspiring to an ideal that eludes definition and raising the question, “What is a middle class income?” The answer varies by the wealth level and gender of the respondent, according to new research from Millionaire Corner.
More than one-third of investors – 36 percent – say it takes a minimum annual income of $70,000 for a household to qualify as middle class, according to a survey of more than 600 individuals conducted by Millionaire Corner in March. Another 33 percent identifies $50,000 as the minimum annual income it would take for a household to be considered middle class.
These numbers aren’t too far off from those provided by the federal government. Real median income for households headed by a married couple was $72,751 in 2010, according to the latest data available from the U.S. Census Bureau, and was $49,445 for all types of U.S. households.
A minority of investors surveyed by Millionaire Corner feel a middle class family could have incomes far above and below this median. Fourteen percent says the minimum is lower - $40,000 in annual income - and another 14 percent says it takes at least $100,000 to be middle class. At the extremes, 2 percent says a middle class family needs a minimum of $200,000 in annual income and 1 percent says a household can be considered middle class with less than $25,000 a year.
Why the skewed view of what it takes to be middle class? The perception appears to be influenced by wealth status and gender – and to a lesser extent, retirement status. Responses from the least affluent survey participants – those with investable assets of less than $100,000 are skewed to lower minimum incomes. Nearly 30 percent of the least affluent say an income of $40,000 defines the middle class.
At the other end of the scale are the Millionaires, who have investable assets of $1 million or more. Only 12 percent of Millionaires feel that an income of $40,000 is enough to be considered middle class. Nearly 40 percent of Millionaires say a household needs a minimum of $70,000 in annual income to be considered middle class and more than 12 percent says a family needs at least $100,000.
Women are more likely than men to think a family with a minimum annual income of $40,000 is middle class, about 18 percent vs. 11 percent, respectively. Men, on the other hand, are more likely than women to think a family needs $50,000 or $70,000 to qualify as middle class. Retirees are more likely to set a lower standard for what it takes to be middle class.
Definitions of the middle class may vary, but government research shows that an increasing number of middle class households are relying on two-incomes to maintain their standard of living. The earnings of wives, in particular, have become increasingly important over time, according to a report issued by the White House Task Force on the Middle Class. The median share of family income coming from wives’ contributions rose from 20 percent to 35 percent between 1973 and 2008, according to the first annual report from the middle class task force.