If I were to ask if you live comfortably, what would you say? Well, recent studies show that 62% of Americans definitely do not feel as if their lives are as comfortable as they would like them to be and you know what all these people have in common? You guessed it, they’re in the middle class. Right now, the middle class is facing a major economic hurdle known as the middle class squeeze where millions of people are slowly falling into financial despair. As such, let me share with you why that is and five mistakes you must avoid to ensure you don’t end up amidst this unfortunate group!
First off, what is the middle class? Typically, we think that as long as we have a roof over our heads and food on the table that we are well beyond the lower class and this is most often true. However, when we look outside our window and there’s no expensive sports car in the driveway, it reminds us that we also do not fall within the group of the financial elite. So, to clear up what it means to be middle class today, if you earn anywhere between $42,000 and $126,000 then you are in fact in the middle class. Now, of course this is a vast range of incomes and there’s no refuting the fact that your lifestyle will be different if you make $40,000 a year versus $100,000 but as a whole this group faces many challenges and I want to now dive into the ones that are acting as the biggest thorn in the sides of this unfortunate group.
The primary reason that the middle class are in such a bind financially these days comes down to what I call the “income-cost” paradox. Before we get into the cost side of this major financial issue, I think it’s prudent to discuss the income issues that most middle class individuals struggle with on a day to day basis. The main issue revolves around the middle class’ reliance on a 9–5 salary as their primary means of making money. Now, you may be thinking “well lots of people earn large salaries so what’s the issue?”. The truth is that making $200,000 or more through a job is rare which leaves most people facing the issue I want to talk more about now.
If you’ve received a raise at work in the past couple of years then chances are you were not exactly calling a Brinks truck to help you get it to the bank. These days, the annual salary raise…