I don’t know about this. This tool easily puts me into the “Top Fifth” in education, income, and wealth. It also puts me at the top end of “Upper Middle” under Occupation.

Honestly, I think I am doing ok, but not THAT well. Either the chart is biased or I am misguided. :)

I believe you are misguided, as I often find myself. The average American salary is under $50k and savings are minimal. There are a lot less “rich” people out there than you would think.

The tool doesnt adjust wealth for age. I probably have more saved than 95% of the people my age, and yet I am labelled Middle

oh whoops, you said that in the blog entry. ignore that last remark then.

At a certain point though (if everyone were to take this advice), don’t you end up with class inflation, i.e. a 70k salary is the new 50k, and everyone expects you to have at least a bachelor’s degree. I think that this is already happening to the younger generation (30 and under). I know so many people who are working on or have obtained advanced degrees in my age group, than those who are just 5 to 10 years ahead.

What I’d be interested in seeing is the debt loads: CC, auto, std loan, mortgage balances because I think that will have a large impact on mobility in the years to come.

To answer cami about education seeming to be the rage. We tend to associate ourselves with people who are like us. Most of my friends and my wife’s friends are college graduates or working on masters, doctorates or phds. We ourselves have a masters and a doctorate between us. Birds of a feather flock together… but most of the world still don’t finish high school. In fact, if you make 100,000 dollars a year. That puts you in the top 1% for income.. worldwide!

Don: yes, you are misguided. It seems like so many Americans, especially of the yuppie generation, have an entitlement disorder. They are actually very wealthy given their earnings and how much they earn compared to others in the US and certainly worldwide. They also live a great lifestyle where all their normal needs are met. However, they still insist in saying they are “poor” (can’t tell you how many of my friends do this) because they always look at what they can’t have (the 2 million dollar house, the next nicer model of BMW, fancy private schools, etc.) Many of us are much “richer” than we realize, especially if we spend our money consciously and don’t take our blessings for granted.

Trent: I disagree with your comment that it’s impossible for younger people to be toward the top of the list unless their name is Rockefeller. Sure, the longer you work and save your money, the more wealth you will accumulate. But, I know plenty of young people who have worked hard and been financially responsible and are doing very well according to this graph. I came from a lower-income background. But, I have held a job since I was 11 years old (always saving money along the way), I got a bachelors, masters and law degree (a lot of the costs paid for with scholarships), and now I am very high up the class ranking even with my young age because I 1) saved money even when earning little and delayed gratification 2) pursued education and worked hard enough to get scholarships 3) have avoided debt on excessive consumer stuff or on living an inflated lifestyle of any type.

81,91,93,55

Yep, young 30 somthings with a child the wealth is biased because of a 68k mortgage balance but otherwise we are doing VERY well for ourselves. Another year or two and we should be over 100k in net worth assuming the fuzzy home value doesn’t drop drastically.

No CC debt, no car loan, no other high interest loans. Sure we have student loans and the mortgage, but those are not bad in the grand scheme of things and are very cheap money.

Just thought I’d mention that the 9% figure you quoted as the percentage of Americans with Bachelor’s Degree seem a bit low. The US Census Bureau says 28% of people 25 years old and over has a Bachelor’s degree or above in their 2006 report.

http://www.census.gov/population/www/socdemo/educ-attn.html

Trent: you also misquoted one other fact…the 9% number refers to the percentage of people who have achieved education/degrees BEYOND a bachelors degree. (It says this on their chart.) I haven’t looked this up reacently, but I think around 25% of Americans have a bachelors degree.

Interestingly, if I were the CEO of the company I work for instead of an engineering manager, I’d drop from the 73rd percentile to the 69th percentile. (I’m not saying that’s wrong, just interesting…)

Notice that the net worth measurement is your net worth in 2001, not today–no doubt it’s harder to get into the top percentiles today for net worth than it is based on the data used to create this tool.

Will Wilkinson (whose blog is well worth reading for its high-quality intelligent commentary) has commented on the subject of income mobility, noting that the studies measure actual movement, not ability to move–and there’s a difference.

Trent: but if you put your cursor on the degree area, a little dialogue box pops up saying that the 9% refers to people who have earned more than a bachelors degree. I just went to a census website, and it says that 25.9% of people over age 25 have completed a bachelors.

Kristina’s right–it’s 25%, and you can see this if you click on “associate’s degree.”

As far as I know, percentile rank usually counts from the bottom of the range covered by that value. I.e., it is the percentage of people who rank “lower,” which is 75%.

The NYT, however, is marking the top of the range covered by “bachelor’s degree.” Thus, they are using the percentage of people who rank “the same or lower” (see footnote above their source attribution), which is 91%.

In a discrete distribution like this (having big categories), adding in the people who are “the same” can be a big difference. I too was surprised to see a number as low as 9% and it took me a little to figure it out.

Great link, Jim Lippard! (And what happened to not keeping up with the Joneses, eh?)

All bachelor’s degree are not created equal, we all know it. 50K is not th same 50K at different locations. NYT wants the readers to fell good on their mobility with lagging indicators.

I find any list that would put Actuaries in the lowest end of middle class to be completely inaccurate. Any profession where the entry level salary is higher than the average MBA should not be middle class.

While often you do find yourself surrounded by people with similar levels of education as you have, I have noticed this phenomenon at other more diverse locations: churches, gyms, etc; it just seems like a lot of young people feel the need to get advanced degrees.

pnongrowthtrack, you’re right all bachelor’s degrees, and even other “advanced degrees” are not created equal.

Not sure if anyone else felt this way — but my occupation was not available on the list. While I don’t necessarily love it, to many people, it might be understood to be somewhat prestigious… (although who really knows).

And I agree with pnongrowthtrack that all degrees are not created equal.

This is interesting and fun — but accurate — me thinks not.

Education can also contribute to downward mobility. I’ve worked since I was ten years old (started shoveling snow, then got my first paper route when I was twelve.) By the time I graduated high school, I had saved up an impressive sum for someone my age.

Then I blew it all on college and ended up earning minimum wage and struggling witgh student loan debt. Where I work we have four college graduates earning minimum wage.

Why would you want to be a different class?

Living in possibly the most class-aware society in the world (England), where class is not a measure of wealth, I would suggest that it is more important to be happy than to be upper middle class. Unless only becoming one of the upper middle class is the only way you’ll be happy.

Interesting - I’m in the top fifth in all categories, yet would never have classed myself there if anyone had asked. I would have put myself in the middle (except maybe education since I have a graduate degree).

I agree with plonkee. Why aim to “move up” a class? I just want to be financially secure — I don’t care about these class indicators. I may have a master’s degree but I am not very comfortable with upper middle class people, and I don’t necessarily want to be like them or share their values. I want to live a simple life.

I would just say to keep in mind that class does not have to do with wealth - class is all about how you are percieved by others, and where others view you. This is why education and occupation are so important, because that is what other people think of when they think of you.

I did find the rankings on the jobs a little suspect, as to where they put them. for example, i would put a physician assistant above a registered nurse, seeing as a PA requires a masters, and an RN is just a bachlers. But i would suspect maybe it is due to familiarity with the title, and percieved prestige?

Thank you Plonkee for making the point that should have been made immediately. Class is the sense of who you are and what you are worth to yourself. Once you begin to look to others for that definition you lose your class.

Apparently, my occupation ranks higher in prestige than the one for which my husband is studying, yet if salaries remain proportionately the same, he will make about double my salary his first year of post-degree work. I’d be interested in knowing how the NYT determined “prestige”.

“I find any list that would put Actuaries in the lowest end of middle class to be completely inaccurate. Any profession where the entry level salary is higher than the average MBA should not be middle class.”

The social status of an occupation is determined by more than just how much money it makes.

If you ask the average person if they’d rather have dinner with a rock musician, an actor, or an actuary, they probably aren’t going to pick the actuary, even though the average actuary makes a lot more than the average rock musician or actor.

(That said, I know an actuary who is a great dinner speaker, who has published articles that talk about things like how childbirth is more dangerous than skydiving…)

I’ve had dinner with a couple of actuaries and they are great but I’d probably still pick to have dinner with a rock musician.

“Once you begin to look to others for that definition you lose your class.”

This I love.

Making 100,000 where I live is chump change. You can just barely get by after buying a house in a good school district. Minimum price for a house is around 300,000 which will get you 2 beds 1 bath ( basement if you are really lucky.)Most for that price is on a slab.

It is interesting to see multiple comments from people who were surprised by their results. There is a body of research that shows that people both far below and far above the middle of the income and wealth distribution commonly consider themselves to be close to the average. Our society is still very segregated by class, so many of us find ourselves surrounded by friends and co-workers who are similar to ourselves. But we also have through the media plenty of examples of extreme cases of people who are far better off or worse off than we are (unless we’re really at the extremes). And thus we all think we’re “average” or “middle class.”

According to the census, median household income is about $46K in the US — median personal income is about $28K. And Trent’s right not just about wealth varying by age but income as well:

Median income by age of householder
15–24 28,770
25–34 47,379
35–44 58,084
45–54 62,424
55–64 52,260
65 and over 26,036

One of my favorite quotes from Your Money or Your Life is “once we’re above the survival level, the difference between prosperity and poverty lies simply in our degree of gratitude.” If you find yourself surprisingly above average, remember that, and give thanks.

Jim Lippard

While your comment may be correct lets look at it this way. I’m currently and electrician, which on their scale ranks dead center of the middle class. I’m also in school to become an actuary which ranks much lower on the class scale. I honestly don’t believe my current job would put me in a higher perceived class than my future profession. Anyway I look at it Actuarial Science would be far above construction.

It’s hard to see myself as upper middle class when I’m paying a third of take home pay for rent in a bachelor pad. But hey I get to live in CA.

I don’t think the occupations are correct. How can a computer system administrator be higher than an actuary, or computer scientist.

Can someone explain this to me?

To Mary: in your area, where do adults earning minimum wage live?

Unfortunately anyone living on minimum wage cannot afford this area ( North Shore suburbs of Chicago) Their only option is renting. It is an extremely sad situation that you have to make such an excess of money to afford a house in the top school districts. Every family should have a right to an equally good education. That would definately bring the house prices down across the country. ( If all schools were given the same amount of money per student)

It’s not possible to equalize education through money alone.

You could cut teachers’ salaries in Lake Forest and have no problem filling all the jobs.

But there is no feasible teacher salary which would put equally competent teachers in Chicago classrooms.

Occupations are a bit funny. My occupation (software engineer) puts me in upper middle class range (77 percentile), while everything else puts me in top fifth - Master’s degree, income, net worth (mostly 90th percentile or above). I am really surprised since I don’t consider myself rich. I specified current net worth and salary, not 2001 net worth as they suggested, though. If I use 2001 values, it would still be top 5th, but 80-something rather than 90-something percentile.

I think at least net worth should be adjusted for age - the older you are the more time you had to save. Also, I am not clear how to calculate net worth: shall I include primary residence or exclude it? shall I include full 401K even if once I start taking it, some part of it will go to taxes?

And as Mary said - location makes a lot of difference. I live in Westechester county, NY, and compare to us the prices North Shore suburbs of Chicago is a bargain. Here the average house price is over 600K. For 300K, you could probably get a one bedroom condo. We also have a much larger chunk of our salary taken by NY State taxes. I shouldn’t complain because a) I bought my property in the 90s and b) it is all paid now, but for people who just look for the first home, 1a so-called top fifth salary will not go that far.