Support NeoGAF

[JGS]

I second the notion that the therm "middle class" is used falsely in this thread by some.

It's not. People just don't like using adjectives. Middle class is far more than people under a 6 figure salary.

If 200k is not middle class, it's still not rich as evidenced by what the 3 groups pay for. I didn't even see where they had luxury cars in the article.

 

[SteveMeister]

Comfortable: you make enough money to pay your bills, save a little, support your family and still be content with your lifestyle.

Rich: you have more money than you know what to do with. Rich people can afford multi-million dollar homes (often more than one) and a garage filled with exotic cars. If you have 3 Ferraris and your "beater" is a top of the line Mercedes sedan, you are probably rich.

The people described in the article are comfortable, but they could easily outspend their income without some discipline. They don't have assets and investments that earn enough gains to make a salary meaningless. Their houses aren't paid off and they're not driving Lamborghinis.

Yes, they are doing very well. Better than most, since they have plenty of money to live a lifestyle that isn't cheap. But they're not rich. And you'll note that "comfortable" can encompass a very wide range of incomes and lifestyles

tl; dr: rich = more money than you know what to do with. These people are comfortably well-off, but not rich.

 

[Alucrid]

Single or not, dude lives a lifestyle that many people consider 'rich'. He isn't representative of normal upper-middle-class. The problem is budgeting, at 70k a year my family could afford a cleaning lady if we wanted one, but only because our budget allows for it. Looking at simply income does not give a clear picture of 'rich'.

The difference is that a single man living on 200k compared to a family living on 200k is radically different. It means that the man can afford an extremely luxurious lifestyle that a family couldn't, yet everyone seems to make him the focal point of their argument. "$800 on wine lol these people are rich bitch" when it's just that one guy, not every family in this article.

 

[Trojita]

Top two are extremely well off.

Being able to afford a vacation house when most families are struggling to pay the mortgage/rent on their house/apartment and not considering yourself well off is ridiculous.

 

[Liberty4all]

I might as well post the other 2 case studies (edited into OP)

Family of 2 (seniors) income 160k

HOW THEY SPEND IT
Monthly expenses | Condo fees: $900. Gas for their Mercedes E320: $150. (“We buy a new Mercedes every three years; it’s our big indulgence,” says Doug. “We always pay cash. This one was $80,000.&#8221 Groceries: $600. (“We mainly shop at Longos and Metro,” says Shirley. “Doug’s a vegetarian and eats like a rabbit: he can go through a lot of broccoli.&#8221 Costco: $300. (“We get everything there. Prescriptions. Fruit. Laundry soap. They have great trout, too.&#8221 Eating out: $200. (“We like Swiss Chalet and Great Chefs on Eight in The Bay.&#8221 Rogers home phone and Internet service: $70. Skype fees: $2.50. (“We use it for long-distance calls to the kids.&#8221 Bathing suits, T-shirts, socks and tennis shoes for the gym: $100. Gym fees at the Mayfair Club: $125. (“I’m there every morning at 7:30,” says Doug.) Newspapers, books and magazines: $70.

Annual expenses | Gifts: $1,000. (“We have two grandkids, and we give them presents for birthdays, Christmas, special occasions.&#8221 Insurance for car and condo: $2,400. Slots at Casino Rama and Casino Niagara: $100. (“I take $50 and go with friends in our building,” says Shirley.) Four-month trip to Myrtle Beach: $15,000. A trip to visit their son Brock in Denver: $2,500. Travel insurance: $8,000. (“At our age? And with pre-existing medical conditions? It’s a huge expense. But we don’t want to be in the States and not be covered.&#8221


Family of 3 166k

HOW THEY SPEND IT
Monthly expenses | Mortgage on their four-bedroom house, purchased in 2010: $2,500. Utilities: $300. Rogers for home phone, cable, Internet and two cellphones: $350. Gas for their Chevy Equinox and Chevy Cobalt: $300. Groceries at Loblaws, Metro, Fortino’s and the Oriental Food Mart on Finch West: $1,600. (“I like to cook dishes that I used to make in Nigeria,” Margaret says. “I often make spinach and okra soup and moin-moin, which is black-eyed beans with peppers.&#8221 Eating out: $100. (“We sometimes go to Mandarin or Mr. Greek to celebrate.&#8221 Lunches and coffees: $50. (“I pack a lunch basket for the family almost every day,” Margaret says. “For our health, we try to avoid eating sugary snacks and drinking coffee. I do occasionally like a Timbit, however.&#8221 White wine, usually consumed with Sunday dinner: $80. Books and magazines: $100. Hair salon: $400. Grooming products for Emmanuel and Iyiope: $75.

Annual expenses | Clothing: $3,000. (“I don’t buy as many new outfits as I used to, since I have several nice suits I haven’t worn more than once,” says Margaret. “My new weakness is shoes and bags. I have a red Coach patent leather bag I love that I got for only $379.&#8221 Furniture and furnishings, mostly from The Brick and HomeSense: $1,000. Vacations: $0. (“We have not been on vacation since coming to Canada. It has been work-work-work.&#8221

 

[Alucrid]

I might as well post the other 2 case studies:

Er...why? They're in the OP.

 

[Liberty4all]

Er...why? They're in the OP.

They weren't a moment ago I just edited them in.

 

[sankt-Antonio]

It's not. People just don't like using adjectives. Middle class is far more than people under a 6 figure salary.

If 200k is not middle class, it's still not rich as evidenced by what the 3 groups pay for. I didn't even see where they had luxury cars in the article.

And why is that a problem? There is a gap between being middle class and rich.

Upper/Higher class in Germany starts at >65K$ (after taxes) in a two parents household with one kid thats under 14 and one thats older then 14.

I know that its hard to compare these figures , but let me say that with <65K a year (middle class, with two kids) you can not go out and spend 800$ on wine bottles each month.

But, 200K its still far from being rich.

Edit: Just for some perspective: GDP in US$ per Head: USA: 48K$; Germany:44K$

 

[Fatghost]

Rich is a state of mind and highly subjective.

 

[Liberty4all]

Everyone I know that I would consider middle class is making on average 80 - 110k annually combined incomes. My single friends make anywhere fom 40k - 60k with a few high rollers balling at 80k or so.

I dont know anyone who makes 200k a year.

My wife is a professional (RN) ... But nurses in Ontario start at 57k and cap out at around 72k annually after 7 years. My line of work as an employment counsellor (currently unemployed an irony) nets around 45k.

I still hold that Middle class in north America is around the 75k - 120k mark (combined income) in terms of lifestyle (owning a home or renting in a nice area, owning a car, being able to support a kid or two and the expenses that come with that as well as a vacation annually). The gap between 75 - 120k would be lower (75), middle (100) and upper (120) middle class. IMHO

 

[Korey]

And why is that a problem? There is a gap between being middle class and rich.

Upper/Higher class in Germany starts at >65K$ (after taxes) in a two parents household with one kid thats under 14 and one thats older then 14.

I know that its hard to compare these figures , but let me say that with <65K a year (middle class, with two kids) you can not go out and spend 800$ on wine bottles each month.

But, 200K its still far from being rich.

That's objectively a false statement. I don't even understand any of your examples or how they support whatever point you're trying to make.

I like how people are pretending that there's some cutoff point where you go from "well off" to being "rich". Being rich is completely relative. If people can get by with less than 25% of what you earn, and you can basically do whatever you want within reason with little to no thought about money, then you're rich. In 99% of places, $200k will let you do that.

 

[Alucrid]

That's objectively a false statement. I don't even understand any of your examples or how they support whatever point you're trying to make.

Okay, how does one objectively come to a income level that signifies that someone is rich.

 

[sankt-Antonio]

That's objectively a false statement. I don't even understand any of your examples or how they support whatever point you're trying to make.

What i wanted to point out is that 200k a year is NOT middle class.

"Rich" has no strikt definition, its up for debate - and in my eyes 200k a year is upper class, fucking nice living, so to speak.

While i would consider someone rich if he could go out and buy a ferrari just because someone feels like it. But thats totaly up for debate.

I see you edited you post:

Of course i was only talking about a "200k a year" situation in the US or a comparable country.

 

[Divvy]

What i wanted to point out is that 200k a year is NOT middle class.

"Rich" has no strikt definition, its up for debate - and in my eyes 200k a year is upper class, fucking nice living, so to speak.

While i would consider someone rich if he could go out and buy a ferrari just because someone feels like it. But thats totaly up for debate.

I see you edited you post:

Of course i was only talking about a "200k a year" situation in the US or a comparable country.

Well if you go by the common definition of "upper class"

Which according to wiki is:

The upper class is the social class composed of the wealthiest members of society, who also wield the greatest political power. The upper class is generally contained within the wealthiest 1-2% of the population, and is distinguished by immense wealth (in the form of estates) which is passed from generation to generation.

I don't think 200k income qualifies.

 

[Htown]

It's not. People just don't like using adjectives. Middle class is far more than people under a 6 figure salary.

If 200k is not middle class, it's still not rich as evidenced by what the 3 groups pay for. I didn't even see where they had luxury cars in the article.

Wine every night.

Multiple $3000 plus vacations in a year.

Multiple houses.

Rich.

 

[sankt-Antonio]

Well if you go by the common definition of "upper class"

Which according to wiki is:



I don't think 200k income qualifies.

I used stats form this site (in german). This article states that 60% of germans are middle class, 22% are... well not middle class, and the rest is upper class (as of 2010).

If one would define the upper class as the 1-2%, i would be wrong.

I just had a look at wikipedia, and the classes in germany are defined as i stated above, mhhh... the 1% are more of an american thing then. I should change my statement to: In Germany, 200k would be upper class

 

[Josh7289]

The only ones who spend their money (reasonably) sensibly are the seniors.

 

[cubicle47b]

The only ones who spend their money (reasonably) sensibly are the seniors.

They still buy an $80,000 car every 3 years. Probably drive it a whole 20,000 miles in that time period too.

 

[Josh7289]

They still buy an $80,000 car every 3 years. Probably drive it a whole 20,000 miles in that time period too.

Yeah, they do say it's their one big indulgence though. My guess is that they also sell their previous car and drop the price of the new one a bit in that way too. I'm not saying they're not rich, just that they don't seem to spend as thoughtlessly as the others.

 

[Neo C.]

They still buy an $80,000 car every 3 years. Probably drive it a whole 20,000 miles in that time period too.

I agree, if a senior's got money, he often spends it stupidly. I see too many seniors in expensive SUVs, which aren't exactly senior friendly. Or living in big houses even though he doesn't need that much space. Not to mention the second and third houses he rarely visits.

 

[Fatghost]

I think the correct definition to rich is: Doesn't have to work.

All these families have at least one person that has to work every day to keep their (large) income going. Rich people have enough wealth that they could easily never work again.

I agree, and rich is relative. If I can support my lifestyle on 20K a year, I need about 500K in the retirement investment portfolio. That would be "rich".

But suppose I need 60K a year, because of higher taxes, I'd need closer to 2 million in the portfolio to be "rich".

It depends on where you live, how old you are, and what your lifestyle is like.

 

[Fatghost]

They still buy an $80,000 car every 3 years. Probably drive it a whole 20,000 miles in that time period too.

160K income from pensions and RRIFs split between two people would go farther after tax than 160K a year income earned mostly by one spouse in the working years.

They have a healthy investment portfolio according to the article...they talk to their broker almost an hour a day, I can tell you, no good broker spends that kind of time with a client who doesn't have a big and/or very active portfolio.

And I think they paid cash for their condo.

They are the only ones in the article that are actually wealthy, as opposed to simply higher income earners.

 

[Deadly Cyclone]

Damn, I wish I was making $166K...

I spend $280 a month on groceries and thought that was a ton...

 

[jmdajr]

200k can go a LONG way if your cost of living isn't so high. But I can see how it's not being rich in some cases.
My friend is living in Boston now and he says the expenses are ludicrous.

As for me, I live much more frugal than other people making what I do. I'm far from miserable.

 

[ToxicAdam]

It's really stunning to me how worked up people get over other people's money. It's kind of gross.

 

[Chuck (Old)]

$200K/year does not make one rich. Well off, yes, but not rich.

It always irks me when Obama mentions his plan to tax the "rich" at incomes of $250K and up.

It's really stunning to me how worked up people get over other people's money. It's kind of gross.

Agreed.

 

[entremet]

I live in Manhattan and if I made 200k I would be a happy camper. I make nowhere near that.

They're just living above their means. Even millionaires--hello pro athletes--do this. Income doesn't matter.

 

[David Incorporated Esq.]

If you doubled all of my current expenses (including luxuries) but gave me 200k a year I would still be saving $5,400 a month.

This article is basically "After I spend all of my money on shit that normal people wouldn't dream of being able to afford I only save $20,000 a year! I'd say I'm just getting by!"

Even at my current income of only $65,000 (only, I say, but that's 150% the median household income) I realize I can afford to do things that other people wouldn't be able to manage. Shit, just last week my car died so I went and bought another that day for $15,000 (I could have paid cash but went with a loan because I'm only paying an extra $200 in interest over 3 years).

I'd say I'm very comfortable, these people are just ignorant.

$200K/year does not make one rich. Well off, yes, but not rich.

It always irks me when Obama mentions his plan to tax the "rich" at incomes of $250K and up.

Only 1.5% of households make more than that and any tax increase above $250k doesn't really affect the person until they're legitimately "rich." With a 3% increase in taxes on income above $250k, a person making $500k would only pay an extra $7,500 a year. That's not even the one guy's wine budget.

 

[Rocket Scientist]

The argument that cost of living being high equals not being rich is hilarious. Fact is that even with this high cost you apparently can still afford to live there. But, let's just ignore that part.

...bought another that day for $15,000 (I could have paid cash but went with a loan because I'm only paying an extra $200 in interest over 3 years)

Damn! No offense but are you it'll only be $200? Not trying to sound snarky or whatever, but I'd read the contract again to be sure.

 

[jmdajr]

Envy isn't exactly a virtue.

I try to never compare myself to others. I just try to make my shit work.
There will always be people better off and worse off than you. Plus, the system will never be perfect. Can't be pissed off all the time.

 

[Nemo]

Lmao, of course they don't feel rich. There's always someone richer than them and that bites them in their asses

 

[Chuck (Old)]

Lmao, of course they don't feel rich. There's always someone richer than them and that bites them in their asses

I'm not so sure this is a case of "keeping up with the Jones'". They're being honest/realistic.

 

[Zzoram]

I always thought for household income before tax, in a modern moderate sized city:

lower class: $<50K

lower middle class: $50k-90K
middle class: $90K-150K
upper middle class: $150K-250K

lower upper class: $250K-500K
middle upper class: $500K-1M
upper upper class: $1M-10M

rich: $10M-100M
really fucking rich: $100M-1B
On Forbes list: $1B+

Rich is relative, people who are in the upper middle class range live extremely comfortable, but they don't typically make large purchases like Yachts on a whim, and are still vulnerable to dropping down several classes if one of the earners loses their job.

People who are rich in today's world don't have to worry about losing their jobs, they have a large enough trust fund that they could live on capital gains forever. To be this secure, you must have at least tens of millions of dollars.

 

[David Incorporated Esq.]

The argument that cost of living being high equals not being rich is hilarious. Fact is that even with this high cost you apparently can still afford to live there. But, let's just ignore that part.

Damn! No offense but are you it'll only be $200? Not trying to sound snarky or whatever, but I'd read the contract again to be sure.

Yeah it's a little bit more than $200, can't remember what, exactly. Maybe that's just the interest per year for the loan and not the total, but it doesn't really matter. I'm going to be spending cash on a race-car this year so it's worth the little bit more in interest to have cash on hand.

Jesus Christ just look at that. $65,000 a year and I'm building a fucking $10,000 race car because it'll be fun. What the fuck are these people complaining about?

 

[Sohter.Nura]

Fucking first world :/ I grew up in a big, big city with a single mom making 35k a year as a teacher.

Nowadays my family makes 80k a year and I consider myself pretty rich =P

 

[Rocket Scientist]

Jesus Christ just look at that. $65,000 a year and I'm building a fucking $10,000 race car because it'll be fun. What the fuck are these people complaining about?

But do you pop open a Chteau Lafite Rothschild Pauillac from 1996 every evening? I don't think so!

 

[Dosia]

I make 70k a yr and while it would be great to make 200k, I would not consider myself rich. I think 500k a yr would be putting myself in the rich category.

 

[David Incorporated Esq.]

But do you pop open a Chteau Lafite Rothschild Pauillac from 1996 every evening? I don't think so!

Of course not, if I did that I'd start using up my income because buying lots of luxury items burns through your money no matter how much you make...

oooooooooohhhhhhhhhhhhhhh.....

 

[Barrett2]

200K for a family isn't rich. It's upper middle class. To clarify, im' talking about the connotation of a rich person lifestyle. If you have a few kids and make 200K a year, you live in a nice house and stuff, but you don't have an S-Class Mercedes or anything.

 

[Stumpokapow]

200K for a family isn't rich. It's upper middle class.

It's top 1% in Canada, as the article notes.

 

[JGS]

Only 1.5% of households make more than that and any tax increase above $250k doesn't really affect the person until they're legitimately "rich." With a 3% increase in taxes on income above $250k, a person making $500k would only pay an extra $7,500 a year. That's not even the one guy's wine budget.

The wine industry suffers.

Seriously, it makes more sense to tax people who are clearly rich higher than ones who are doing well. 250k should not be considered clearly rich and the tax burden would still remain higher on them than it would someone who makes 10 million a year or even a million a year. They are travelling in very different circles.

 

[afternoon delight]

I'd care, and get class envy, but I'm not going to.

Still wish we could hoist their remains from the tallest buildings though.

 

[Hari Seldon]

I was in this income bracket before my wife went part time because our child was born. I didn't consider myself rich, but we were pretty comfortable. We were able to save up money, pay off all our shit and be debt free, and give loans to our parents for emergency shit. But at this income level, unless you don't want to save and you have no debts to pay down, we basically had to choose one of a nice vacation every year or a nice car or a big house. We chose vacation because we worked so fucking much to make this money lol.

 

[Stumpokapow]

The wine industry suffers.

Seriously, it makes more sense to tax people who are clearly rich higher than ones who are doing well. 250k should not be considered clearly rich and the tax burden would still remain higher on them than it would someone who makes 10 million a year or even a million a year. They are travelling in very different circles.

The whole point of a progressive system is that it's progressive, not binary. You seem to be arguing that you're in favour of progressive taxation, but only for the ultra rich. In a proper progressive system, the ultra rich pay a higher marginal rate than the rich who pay a higher marginal rate than the well-off who pay a higher marginal rate than the middle class who pay a higher marginal rate than the working poor who pay a higher marginal rate than the destitute. It makes sense to tax people who are clearly rich AND people who are doing well.

 

[David Incorporated Esq.]

The wine industry suffers.

Seriously, it makes more sense to tax people who are clearly rich higher than ones who are doing well. 250k should not be considered clearly rich and the tax burden would still remain higher on them than it would someone who makes 10 million a year or even a million a year. They are travelling in very different circles.

Okay? I'm in favor of more tax brackets beyond $250k as well, what's your point?

My point was that someone making $250k/yr would be completely unaffected by a tax increase on income above $250k, so people saying "Those people aren't rich don't call it a tax on the rich!" are missing the point.

 

[Divvy]

The wine industry suffers.

Seriously, it makes more sense to tax people who are clearly rich higher than ones who are doing well. 250k should not be considered clearly rich and the tax burden would still remain higher on them than it would someone who makes 10 million a year or even a million a year. They are travelling in very different circles.

A modest tax increase in a progressive tax system wouldn't affect them in any significant way. I don't think they're rich, but they still have the room to be taxed slightly higher. This is pretty moot since Obama isn't going to tax a bunch of Canadian families.

 

[Omegasquash]

All depends on where you live for cost of living purposes, and what you spend your money on. We all see things differently, and we all see things from our perspective. To a single Mom making 50k a year, a stay at home Mom in Manhattan dropping $300 on a stroller is going to appear rich. To that stay at home Mom, Beyonce is going to appear rich.

Someone that HAS to be frugal is always going to see someone that doesn't have to be frugal as rich. Can't blame anyone for that.

 

[Hari Seldon]

Another thing to note that a lot of tax breaks go away at much lower income levels than 250k. Like you can't write off your student loans, you can't do Roth IRAs, probably some other shit but my wife is the accountant in my family lol.

Edit: In the US.

 

[Barrett2]

It's top 1% in Canada, as the article notes.

True. I guess im' more thinking about the connotations of what a rich person owns and does.

When I think 'rich person,' I think of S-Class Mercedes and trips to Paris.

 

[ReBurn]

It's disingenuous to use a couple of examples to make a determination about every family making $200k per year. The people in the examples could probably make some lifestyle changes and probably build some wealth. At the same time, I've known people who have earned high incomes that were hardly making it for very legitimate reasons. Medical bills and legal fees mostly. Also relative cost of living, including higher taxes in different areas.

Ostensibly, many of us could quickly become wealthy if our income jumped from what it is now to $200k or more and our expenses remained the same. But we have to be careful not to see everyone else through the filter of our own lives. I would love to make that much, but I would probably also increase my standard of living. That would make it seem like so much less than it really is.