It may come as a shock, but there is no set definition of the middle class. Some scholars think it should solely be based on income. But as it turns out, there are a lot of other characteristics that make up America’s middle class.

Source: Giphy.com

When you hear the term “middle class,” what do you think of? If you’re like most people, you probably think of someone who is comfortably middle-income — not too rich, but not too poor.

But what does “middle class” really mean? And how has the definition changed over time?

What is Considered Middle Class?

Believe it or not, there is no universal definition of the middle class.

  • Economists tend to look solely at household income or wealth.
  • Sociologists look at education and credentials.
  • Philosophers tend to prioritize culture and values.

In reality, whether or not you’re in the middle class likely depends on a combination of your income, experiences, and cultural values. But before we dive into that, let’s cover some technical definitions first.

Pew Research’s definition of middle class

Pew Research defines the middle class as those who earn two-thirds to double the median household income.

The median U.S. household income is currently $67,521, based on recent Census data. So, by Pew’s definition, the middle class is anyone who earns between $45,014 and $135,042.

Wondering if you’re in the middle class? Use Pew’s income calculator to find out.

Brookings Institute definition

The Brookings Institute defines the middle class as people who make up the middle 60% of households (or middle three quintiles) on the income ladder. This means you’d be considered middle class if your household income falls between $39,479 and $109,732, based on recent Census data.

This range is a bit tighter than Pew Research’s range, but it still leaves a pretty big gap in who’s considered middle class or not.

Urban Institute definition

The Urban Institute defines a middle-class family as those whose annual household income is 150% to 500% above the poverty line. The poverty line for a three-person household in 2020 was $21,720. So middle class would be those making between $32,580 and $108,600.

At-a-glance summary

This table gives an at-a-glance look at how all three definitions of middle class compare:

Who is considered “middle-class” in America?
Pew Research’s definition$45,014 to $135,042
Brookings Institute’s definition$39,479 to $109,732
Urban Institute’s definition$32,580 to $108,600

As you can see, all three definitions give a pretty huge gap between the lower and upper limits of the middle class.

And it’s safe to say that someone who makes $30k or $45k a year will likely disagree that their financial struggles are the same as someone who makes more than three times as much money as they do.

Read more: Wealth Does not Equal Income — How to Feel Richer than Someone Earning Twice as Much

So how else can we define middle class? Turns out, it may have more to do with your money values and goals than it does your actual income. Let’s take a look.

Characteristics of Middle-Class Families

Source: Giphy.com

Aside from these technical definitions, many scholars believe middle-class families have several lifestyle goals in common that tie them all together.

For instance, many middle-class families strive for the American Dream. They want to:

  • Own a home or vehicle.
  • Pay their bills on time.
  • Have enough money to save for retirement.
  • Send their kids to college — even if it means taking out loans to help.
  • Have enough money to afford an occasional vacation.

Based on these characteristics, the middle class could be defined more as a state of being rather than a household income. And if you also have aspirations of achieving the American Dream, you could very well be in the middle class.

Read more: Why So Many People are House Poor and How You Can Avoid the Same Fate

How Middle Class Varies by Location

Source: Giphy.com

Geography also plays a huge role in how the middle class is defined. After all, cost of living can go a long way in determining how “rich” or “poor” you feel on any given salary.

In some parts of the country, $40,000 goes a lot further than it does in others. In inexpensive cities like Fort Wayne, Indiana, or Topeka, Kansas, you may easily survive (or thrive) on that income.

But in pricey places like San Francisco or New York, it may not even be enough to cover rent. (A studio apartment in New York costs $3,638 on average — that’s over $40,000 a year!)

How the Middle Class has Changed Over the Decades

Source: Giphy.com

Income is often used as a way to measure class, and in that sense, the middle class today is very different from what it was even a few decades ago.

In 1970, the median middle-income family earned about $60,000 (in constant 2020 dollars), according to Pew Research. Today, that number has increased to $90,000.

But even as incomes have increased, so too has the cost of living.

  • Healthcare is more expensive.
  • College tuition prices have exploded.
  • Groceries and the cost of goods have increased.
  • Pensions have gone away.

All of these factors mean that, in many ways, the middle class is struggling more than ever before.

Read more: The Cost of Having Health Insurance — Is it Worth it?

Why the Middle Class is Shrinking

The middle class has been declining in recent years due to a number of factors, including globalization, technological change, and the rising cost of living. And of course, all of these factors have been exasperated by the coronavirus pandemic.

  • Globalization: Jobs that were once middle-class jobs, such as manufacturing jobs, have been outsourced to other countries where labor is cheaper.
  • Technology: Jobs that were once considered middle class, such as data entry, agriculture, and accounting, can now be accomplished by fewer people thanks to automation and computers.
  • Rising cost of living: The cost of housing, healthcare, and education have all been rising faster than people’s incomes. This has made it difficult for middle-class families to keep up with inflation and the rising cost of living.

Read more: Inflation is on the Rise — Here are 7 Tips to Protect Your Finances Against it

Summary

There are several technical definitions of the middle class, but whether you fall into this economic hierarchy may have more to do with your location, dreams, and goals rather than how much income you make.

Featured image: trekandshoot/Shutterstock.com

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About the author

Cassidy Horton
Total Articles: 50
Cassidy Horton is a finance writer who specializes in banking and insurance. She earned her MBA and bachelor’s degree in public relations from Georgia Southern University — and has since published hundreds of finance articles online for Forbes Advisor, The Balance, Money, Finder.com, and more. When she's not helping Millennials and Gen Zers gain control of their finances, you can find Cassidy hiking around the Pacific Northwest, cuddling her two cats, and eating way too much fried chicken. Connect with her on cassidyhorton.com or LinkedIn to see what she’s up to next.