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Sunday, February 18, 2018

Poor, Rich, and Middle Class - who are they?

For the book I'm thinking about I need to define the terms rich, poor, and middle class.

Who are the poor? 
According to the 2018 US Poverty Guidelines, a family of four making $25,100 or below are considered poor.  That sounds straight forward, but what does it really mean?  Does this family have hungry teenagers or a baby that needs expensive formula?  Do they live in income support housing or does their rent take half their income? What about the family making just above the line that has no food stamps or SNAP benefits?  What about the multitudes of families making under the equivalent of $2 a day in US dollars living in other countries?

Who are the rich?
There seems to be much less consensus on what it means to be rich.  Some statistics use twice the average income as a guideline.  In 2016 the median household income was $59,039.  That means any household making  $118,080 or above would be considered rich. This of course does not take into account the number of people in the family or debt.  While people in the lower end of this category are most likely not struggling for daily needs, they also might not have money for extravagant extras.  Is this rich?  Another way to draw the line is to call the top 1% of earners wealthy.  This would include any family making $389,436 or above, but I'm not sure it takes that much to be considered rich.

Who are the middle class?
According to one website, middle class is anyone earning between 67% and 200% of the median income.  For 2016 this range would be $39,560 to $118,080.  This encompasses about 50% of Americans.  That seems to leave a gap between lower middle class and the US Poverty line, but at least it tells us that these are the folks in the middle - in-between rich and poor.

For me the numbers don't tell the whole story.  By these stats, I would be upper-middle class.  If I compare myself to people who make more than my family, who travel and dine at expensive restaurants, I feel much more lower middle class.  My family pays our bills and we are able to put our children in extra-curricular activities, but we are not extravagant and money is tight at times.  Then I compare myself to people making less.  Their kids are not taking gymnastics lessons.  They run out of food before the month is up.  They don't have securities like renter's insurance.  Compared to them, I probably look rich.  Additionally, if we look outside our borders - to so many people without running water or electricity, we would all be considered rich.

So, if the numbers fail me, how do I even get a handle on the title of this book?

I am left with my own, subjective, definitions:

Poor - any person or family that struggles to meet their basic needs of food and shelter.

Middle Class - households that have finances to meet their basic needs and provide a few extras but may not have resources for emergencies or extravagances

Rich - those who are comfortably meeting their needs, provide for future expenses and emergencies and have extra for charity and fun.

My definitions are still inadequate, but they give the reader a general idea of what I mean when I use these terms.  I also want to emphasize that I am putting no emotional connotation on these labels.  Too often our society connects a person's value to the amount of money they earn.  In this book, and in my life, I am hoping to let people see that value has nothing to do with wealth.


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