We often hear the term “middle class” thrown around in a variety of conversations. Have you ever stopped to wonder exactly what that means? According to the U.S. Census, the “real median household income” in the state of Colorado in 2015 was $63,909. The lower bracket (or 66% of this figure) was $42,606 and the upper bracket (or 200% of this figure) was $127,818. The “real median household income” in the local Denver-Aurora-Lakewood metropolitan area in 2015 was $70,283, with a lower bracket of $46,855 and an upper bracket of $140,566.
Although these definitions give us specific dollar figures to reference, the mentality is vastly different. According to the CNBC Millionaire Survey, only 9% of millionaires described themselves as wealthy, rich or upper class. The remaining 91% described themselves as middle or upper middle class.
Why might this be the case? CNBC shares, “Studies show that more than three-quarters of today’s millionaires made their money themselves and started out in the middle class or lower.” Another observation from George Walper, president of Spectrem Group, is that “today’s wealthy also want to avoid being labeled as wealthy because of the cultural hostility toward the rich…. it’s a very small percentage of people who want to be out front in the media.” This may help us understand why we hear the term “middle class” so often in political speeches.
Why does this matter to us? First, when you hear the term “middle class” in the nightly news, you now understand what exactly they are referencing. Second, and more importantly, you now understand that the term “class” is simply a mentality rather than a dollar figure. No matter how your finances are structured, you have the freedom to associate yourself with whichever “class” you choose.
If you would like help with future financial choices for yourself, please call 303-639-5100 to schedule a complimentary consultation.