Once twitter I noticed that SeeJaneGetRich tweeted a link to a U.S. News article on yahoo called “How to gauge your middle class status”. Since I love feedback and statistics, I thought I’d check it out.
It was an interesting read so I decided I’d write about how I was doing.
Income: We are very close to the middle-middle income level for a 2 parent, 4 person household. We are a bit above that $81,000 dollar number, but still less than $100,000.
Housing: Our house is assessed at $210,000, but it’s only 2,100 square feet. It’s a good size for my family though.
Medical Expenses: First, we are doing an HSA, so it’s kind of like it’s still our money. But we are much lower than the $5,100… We are more like $500…
Cars: We have 2 cars, both were bought new, but only cost about $40,000. That period in time may be the last time we buy new cars. Our expenses around them are less than average because I telecommute a few times a week and carpool with a buddy occasionally.
College Savings: This is one area that I am very average. My savings rate is around $4,000 a year. To date, I have a total of $65,000 saved for my kid’s college expenses in a 529 plan.
Vacations: We’re pretty typical here too! Although we usually only spend about 75% of the $3,000 amount the average middle-class American spends.
Retirement: I save about 15 to 20% of my gross income in this area. I got hit hard during the 2008 recession, but it’s coming back nicely!
Everyday Spending: This is one area we really win at (being frugal and all), but kid’s sports and other needs have had this number slowly rise over the last 5 or so years. We have been going through a bit of a lifestyle creep for our kids. But at least our kids are happy… Our costs are still far less than the average though!
Number of Earners: For the past 9 years, it’s been primarily me, but since my daughter started kindergarten, my wife now works a side job for about 6 to 8 hours per week. So this is one area that has hurt us and my financial plans. I feel a little robbed here compared to my peers.
Hours Worked: With my wife working now, we still work less than 50 hrs a week, but definitely more than 40.
Education: Both my wife and I have college bachelor degrees. I play around with the idea of going back for an MBA, but so far, I’m too busy.
Free Time: My family has plenty of free time, I do not. Again, I’m hurting here compared to the average. But it’s okay, I’m getting used to disappointment from my entire family tree.
Retirement: Over the years I put in what I thought was a lot… At least until my 401k company provided stats for age and income level. I’m in the top 1% for my 401k balance, but only at the top 12% for amount contributed. I must be doing something right though… Probably my balance is high because I was ultra-aggressive with contributions during the 2008 recession.
Household Net Worth: I don’t think this number is for the average 4 member middle class family… When compared to a similar socio-economical family like ours, we are higher than average. Hopefully, in the near future, our spread will continue to expand, since we are totally debt free (no house mortgage).
Debt: I have no debt (credit card, auto or mortgage) at this point in my life. I’m actually surprised that the payments towards debt are only 18% of the disposable income! I was thinking the percentage would at least be over 20%.
Well, there you have it! My assessment for how I’m going verse the average middle class American! Overall, I’m very happy with our progress. In fact, I believe we are going better in every area above, at least in a positive sense (for example, our hours worked isn’t over 70 per week, and I view that as very positive).
Enjoy the weekend!
-MR