S&P 500, Dow Jones Global ex-US, Gold, Bloomberg Commodity Index returns exclude reinvested dividends (gold does not pay a dividend) and the three-, five-, and 10-year returns are annualized; and the 10-year Treasury Note is simply the yield at the close of the day on each of the historical time periods.
Sources: Yahoo! Finance, MarketWatch, djindexes.com, London Bullion Market Association.
Past performance is no guarantee of future results. Indices are unmanaged and cannot be invested into directly. N/A means not applicable.
What does it take to be middle class in the united States? The not-so-simple answer is it depends on how you define ‘middle class.’
In a 2018 report, Pew Research Center defined middle class as middle income. “In our analysis, “middle-income” Americans are adults whose annual household income is two-thirds to double the national median, after incomes have been adjusted for household size. In 2016, the national middle-income range was about $45,200 to $135,600 annually for a household of three.”
In November, USA Today shared an analysis by Michael Sauter that adopted a different standard. It considered U.S. family income from “…the lower boundary of the second quintile and the upper boundary of the fourth quintile [of the U.S. Census Bureau’s 2018 American Community Survey], representing in total 60 percent of American families…The analysis made some cost-of-living adjustments and found, “…the range of income that could be considered middle class in a given state.”
In the states with the highest median (the number in the middle of the list) family incomes, middle-class income ranged from:
- Massachusetts: $35,233 to $188,259
- New Jersey: $39,920 to $197,868
States in the middle of the pack for median family income had these middle-class income ranges:
- Wyoming: $25,760 to $111,422
- Kansas: $24,741 to $105,573
- Iowa: $24,663 to $101,008
In the states with the lowest median family incomes, the middle-class income range was:
- West Virginia: $17,452 to $85,516
- Mississippi: $15,165 to $81,480
It’s interesting to note the 2020 federal poverty threshold set by the U.S. Department of Health and Human Services, which determines eligibility for various federal programs, was $26,200 for a family of four.
Not everyone uses income to define the middle class. Richard V. Reeves, Katherine Guyot, and Eleanor Krause of Brookings explored the question, asking:
“Is middle-class status a reflection of economic resources, especially income or wealth? Or is it denoted more clearly by occupational status and/or educational attainment? Is it, rather, a state of mind, a set of aspirations, or revealed through behavior, cultural tastes, or by certain kinds of consumption? Is it a question of how we define ourselves?”
What do you think?
Weekly Focus – Think About It
“I wasn't going to be an actor. I was going to be a lawyer. I came from a family just above working class, just below middle class, a great family of wonderful values. The idea of me having a chance for a law degree was enticing. Enticing to me but also very enticing to my family.
--Gerard Butler, Actor
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