What's "Middle income" to you?

A place to discuss anything... except credit cards!
Fastphilly
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Postby Fastphilly » Sat Feb 21, 2015 3:52 pm

whit wrote:Same, and it's the only way to survive in a city that's overflowing with those that have a much higher ratio of income

But it's not just about how you budget and spend your money it's about the ability and don't get me wrong, the 10.49 isn't a daily habit

But I have the ability to splurge when I want to because I save where I need to

Some folks could spend a lifetime never taking vacation and you can say you feel sorry that they've never left the continent they're in but, they choose to so they can have a roof over their head and food on the table and send their children to the best schools to have the chance to better themselves rather than spend money on said vacations

But I'm sure if those folks had the ability to do both they would


^^^Excellent post!! Everybody's case is different. I don't have children so that's money I don't have to allocate. Just pay my utilities/property tax and have a ball with the remainder of my income. Yes I have a 457K plan so I stash money for the future but I'm also a believer of you only live once so buy what makes you happy if you can afford it. As long as your place of employment is steady and you have longevity with your employer it's easy to budget out finances if your single like myself. Having children/mortgage requires much more responsibility and I tip my cap to any person that has managed their credit and spending over the years with important obligations like those. It's not easy to say the least.
In Wallet:
SM Credit Union Platinum Visa 15K (opened 2004)
Citi Double Cash MasterCard 6.6K (opened 2015)
Chase Freedom Visa 5K (2009) (morphed from Providian/Wa Mu)


LessIsMore
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Postby LessIsMore » Sat Feb 21, 2015 7:15 pm

After reading some of the posts here, it looks like I'm one of the poorest people in the forum. I'm retired, receiving pension and Social Security, the total of which is $32,052 annually. Of course (grin), I have a rainy day fund in my TreasuryDirect account - mostly in TIPS securities. But I do live in a rural area where my income goes a LONG way - especially since I'm a miser by nature - except perhaps when it comes to charity.

I also have 14 credit cards - all unsecured, none with an annual fee:

KeyBank Rewards MasterCard - $5k
Citi Diamond Preferred MasterCard - $4.8k
Walmart MasterCard - $3.3k
Capital One Platinum MasterCard - $3k
Chase Slate VISA card - $3k
Chase Amazon.com VISA card - $2.7k
BarclayCard Rewards MasterCard - $2.5k
Chase Freedom VISA card - $2.2k
Unitus Credit Union Rewards VISA card - $2k
Chevron/Texaco card - $1.45K
Discover IT card - $1.25k
AmEx Blue Everyday card - $1k
PepBoys card (auto repair) - $1k
Red Canoe Credit Union Platinum VISA card - $1k

That's a total credit limit of $34.2k (greater than my annual income). Before anyone gasps, I should add that my utilization rate on all cards is "under" 5%. Once monthly, I put a charge on every card (usually small). And, on the day each card's invoice is posted, I pay the balance off in full (not waiting for a due date). This keeps all cards "active" month-by-month - and I've yet to pay a penny of interest on any of them.

Why so many cards? I look upon credit like the handle on a fire-alarm - to be pulled only in case of an emergency. In essence, cards are my "safety net" in case of unpleasant surprises (auto, home, medical, etc.). So far, I've been lucky. But everything ages (sigh). In any case, I believe that the broader the safety net, the better. And other than the tiny charges on the 14 cards, I'm strictly a cash-n-carry guy. Or, more accurately, a "debit-and-carry" guy.

So - am I a lower income person or a middle income person? I'm not sure I like any description based on income alone.
"People with a clever plan can assume the role of the mighty."
Paul Kantner

whit
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Postby whit » Sat Feb 21, 2015 8:30 pm

^ I think one of the biggest problem is society's negative connotation with the term "lower" class and those who don't like it and is willing to fall into the perils of credit and interest to keep up with the joneses so to speak, at the same time..not fighting as hard for fair wage and ways to even out society as a whole.

I'll admit, in my city, I'm considered lower class..and so yeah, I wouldn't go out as much, I have less items than my colleagues but the quality is much better..they have cars and vacation, I have vacation and savings.

I'm not looking for handouts but it's a bit ridiculous that one could have a full time job, make decent money in the eyes of the federal government (referring to their "level" of poverty) and yet, I probably would never buy a home or even an one room condo because rent control > owning for my budget

Do you realize at even 32k a year (not including treasurydirect) you make more than what a person would with minimum wage working full time? i looked it up, apparently it hasn't changed since 2009--it's 7.25 or 15,080 annually

Highest state wise btw, is dc, at 9.50 or 19,760

If you're looking at cities--Seattle approved of minimum wage 15 over a few years..coming up to 10/11 in April but San Francisco/san Jose is at 11.05 and 10.15 respectively

So yeah, there are plenty out there that is making less than you even at retirement and you guys are probably battling different expenses (medical versus building equity)

some might even be on this board, they're just not vocal about it because it sucks, that we are living in an age where things are $$$$ and majority is paid $-$$ and really, churning out so much goods because they need to keep turning profits to make their shareholders happy while not realizing where they can materialize these customers from (or keep them coming back through the revolving door) if the cost doesn't correlate with what they're paying their own workers..sub in credit and lay ways and paying over time, it's like a house of cards

darkguy2
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Postby darkguy2 » Sat Feb 21, 2015 9:34 pm

Here is a good video that I think everyone should watch on wealth distribution in the US.

[video]https://www.youtube.com/watch?v=pWomZkL6sGA[/video]
Discover IT - $5,700
Chase Freedom - $5,700
Costco Citi - $13,000
Sallie Mae - $4,000
Chase Sapphire Preferred - $6,000
Chase Sapphire Reserve - $19,500
Citi Double Cash - $6,500
Amex BCE - $13,000

FICOs: Discover (777), SallieMae (764), Amex (767), Citi (772)
FAKOs: CK- TU (760), EQ (760)

whit
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Postby whit » Sat Feb 21, 2015 10:28 pm

I'm too lazy to make pie charts and such but

Probably better conveyed that way than how I communicate

Fastphilly
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Postby Fastphilly » Sun Feb 22, 2015 12:49 am

That's nothing new. It's been going up a healthy rate since the Reagan admin. Why the poor stay poor and the middle class losing ground is due to stagnant wages and the increase in housing cost. Here in the Bay Area (San Mateo County) a 70 year old 1600 sq. ft. home goes for $800K. The wage inequality is hardest felt here.

There is a reason why retail giants that have been in business for many many decades have filed for bankruptcy (Montgomery Wards, Mervyns, Emporium Capwell). The average middle class and poor can't afford to buy quality goods so they go to Walmart and Target to by cheap Chinese junk.

Corporate America runs this country and they will make every effort to short change the American worker. We seen this first hand on the bailouts to these large firms.
In Wallet:
SM Credit Union Platinum Visa 15K (opened 2004)
Citi Double Cash MasterCard 6.6K (opened 2015)
Chase Freedom Visa 5K (2009) (morphed from Providian/Wa Mu)

LessIsMore
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Postby LessIsMore » Sun Feb 22, 2015 7:13 am

whit wrote:^ I think one of the biggest problem is society's negative connotation with the term "lower" class and those who don't like it and is willing to fall into the perils of credit and interest to keep up with the joneses so to speak, at the same time..not fighting as hard for fair wage and ways to even out society as a whole.


Hmmm ... that sounds like my ex-wife (grin). But what I meant by not liking categorization by income alone ... or even net-worth alone ... is that there are, I think, better indicators to use when summing up a person's ability to manage their financial affairs. My ex and I were truly the "odd couple" when it came to that. Early in our marriage, she acquired her first VISA card ($500 credit limit). And literally before the ink was dry on her signature, she was in a shopping mall. When she came home, she had over a dozen pairs of shoes - and her remaining credit was in the single digits. And when I asked her, "Why so many shoes?" she replied (seemingly astonished that I'd even asked), "Because they were on sale!"

There are people who make $50k per year but manage their finances well. And there are people who make 4 times the income who don't. My ex was the kind of person who said (on many occasions), "My friends have this-or-that - why can't I?"

To dispense with "all" the dirty laundry of our marriage, let me just say that by the time I divorced her, I was making $55k per year and had $9k of consumer debt (partly from bailing her out of her own dilemmas). She was making $18k per year and had $28k of consumer debt. She had to file a Chapter 7 bankruptcy shortly after the divorce. And when she did, her creditors came after me - eventually forcing me to file a Chapter 13 bankruptcy. It was discharged in 2011 after 5 years on on-time payments. I retired the next month and started rebuilding my credit with a secured VISA with a $1,000 credit limit. In 2012, after 12 on-time monthly payments, the issuer converted it to unsecured. And finally, in 2013 (7 years from the 2006 filing date), all credit-file notations of the Chapter 13 disappeared from my credit reports. Armed with a clean credit file and 2 years of positive input on 1 VISA card, I began applying for other cards. So, except for the 1st VISA card (which I still have), the other 13 cards were acquired between July of 2013 and now.

So, if we used the category of "wisdom" in handling financial affairs since the divorce, I'd like to think I rank higher than the average person. FWIW, after her bankruptcy, my ex started getting into credit trouble again (sigh). But, she was saved by hooking up with a "sugar daddy" who assumed my earlier role of bailing her out of credit dilemmas. They're still together. But it hasn't been all sweetness and light. One of the first things he gave her was (ahem) herpes.

whit wrote:Do you realize at even 32k a year (not including treasurydirect) you make more than what a person would with minimum wage working full time? i looked it up, apparently it hasn't changed since 2009--it's 7.25 or 15,080 annually.


The city of Portland, Oregon recently upped the minimum wage for city workers to $15 an hour ... without (snicker) first determining how they would fund it. I took a look at my retirement income, divided it by 2,087 (the "national standard" number of hours worked by a full-time employee per year), and came up with $15.36 per hour. Of course, I had to work 30 years to get that "wage." Anyhow, I posted to the OregonLive forum that I wondered how people could justify making the same income I have now - just by walking in off the street. No replies - yet.

whit wrote:So yeah, there are plenty out there that is making less than you even at retirement and you guys are probably battling different expenses (medical versus building equity).


Medical expenses were a concern to me. This August, I'll turn 65 and apply for Medicare Part A & B. And I'm hoping I don't have an "emergency" between now and then. If I can make it to August healthy, I should be covered well. My current insurer (Cigna) will allow me to keep their coverage beyond age 65. The premium would be the same but, with Medicare being primary, Cigna will "waive" all co-pays and deductibles - even on RX drugs. In short, at age 65, I'll have ZERO-DOLLAR out-of-pocket coverage - assuming I only see their network-approved doctors. And nowadays, there are a lot more of them than there are doctors who accept Medicare assignment.

I'm so shocked that many of my senior friends haven't adequately planned for their retirement - even a little bit. And I'm equally shocked that some people (even seniors) have been locked into "consumerism" as a means to find happiness. I've always believed in the "hobo ethic" that people don't own possessions - they are owned BY them. I never "got used to" surrounding myself with "things" the way some people have. Give me a good book and a comfy chair and I'm a happy camper (grin). I don't even go on vacations. If I'm already enjoying life, why would I need or want to take a "break" from the process? And I certainly won't be going abroad. I've often joked that there's only one country on the face of this Earth where American tourists are treated with respect - and I'm living in it (grin).
"People with a clever plan can assume the role of the mighty."
Paul Kantner

JamesMS
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Postby JamesMS » Tue Apr 14, 2015 4:53 pm

I think "Middle Income" depends on a few factors. Are we talking family income (husband & wife) or just personal? This being said, I personally think that based on my situation, I'm upper middle. Here's why:

- I am single (I do have 1 child which I support)
- I own my home
- I have plenty of savings and securities
- I own my own business. While it is not a fortune 500 company, I do have around 35 employees and have been doing this for the past 10 years.
- My income is roughly $90,000 per year (could pay myself more but I do not need it nor do I want to pay any more taxes)
- I only have $2500 in credit card debt.
Main Cards:
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Spark Cash Back (Business), Amex Plum (Business)

whit
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Postby whit » Wed Apr 15, 2015 12:38 am

I think the biggest factor is where you live..70k annually as minimum wage sounds a lot to some, but in some areas, it's pretty spot on considering cost of living AND wanting to have an actual retirement based on savings. Considering pension is pretty much out the door and social security is heavily used.

http://www.nytimes.com/2015/04/14/business/owner-of-gravity-payments-a-credit-card-processor-is-setting-a-new-minimum-wage-70000-a-year.html?action=click&contentCollection=Pro%20Basketball&module=MostEmailed&version=Full&region=Marginalia&src=me&pgtype=article

MemberSince99
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Postby MemberSince99 » Wed Apr 15, 2015 8:48 am

I think I would define "middle class income" as anything over 450k a year.


I saw one of our Congressmen said that, and he should know.


The funny or sad part depending on how you look at it is you almost need to make that to survive in some areas of the country now.


I get a kick out of it when I read these articles, always by ultra conservatives, saying how Americans making minimum wage earn more than 50% of the world earns or whatever it is. Yeah that may be true but try LIVING on that wage and then tell me how "lucky" they are. 7 bucks an hour gets you a hell of a lot more in Bangalore than it does in NYC. Just saying. To compare that is worthless without also considering cost of living, just like saying "average income is climbing". Sure it is, because the CEO earns 1000 times what the average worker does - if you take their pay out of the equation then pay is stagnant and declining compared to inflation. It's just misleading statistics to try to propagandize their point.



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