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5 signs you belong to the middle class


Reports of the demise of the middle class may be premature, to paraphrase Mark Twain

About seven out of 10 Americans consider themselves middle class, according to a new survey from Northwestern Mutual, a Milwaukee-based insurance company. The survey is part of an ongoing research effort from the insurer to understand how Americans view their finances, and it provides insights into the middle class at a time when many of its members are finally getting back on their feet a decade after the Great Recession.

When asked if they would describe themselves as middle class, a vast range of Americans agreed that they fit into the group, the study found. About 68 percent of those who self-identify as middle class earn anywhere from $50,000 to about $200,000 per year. That may be because many Americans view the middle class as a lifestyle, and not just how much they bring home in their paychecks.

"It has more to do with your optimism and feelings of stability about your financial future," said Rebekah Barsch, vice president of planning at Northwestern Mutual. "The middle class is becoming this state of mind that, 'I'm going to be able to get by.' That's where the divide is between middle class and the rest of the general population. They feel they figured out a way to have the life they want for them and their families."

To be sure, the survey is asking Americans to self-select whether they fit into the middle class, which casts a wider net than the income-based limits that demographers typically use when studying the group.

Pew Research Center, for one, has found the middle class has grown smaller in 90 percent of U.S. metropolitan areas since 2000. That's due to wider income inequality, which includes more Americans moving out of the middle class and into the upper-income bracket, which Pew views as earning annual income of more than $145,000 for a family of four.

Read on to learn more about five characteristics of the middle class, as identified in Northwestern Mutual's survey of 2,749 adults conducted in February.

1. You believe in the American dream

Bill Chizek

Adults who identify as middle class are more likely to say they believe the American dream is still attainable for most Americans, according to the survey. About 55 percent of middle-class respondents said anyone can achieve the hallmarks of a successful life, compared with 48 percent for the overall population.

Not surprisingly, the wealthier you are, the more likely you are to agree that the American dream is still alive and well. Almost two-thirds of Americans who earn more than $250,000 are believers in that dream, compared with only one-third of those earning less than $25,000 per year.

2. You earn between $50,000 to $125,000


About half of those who self-identity as middle class earn more than $50,000 but less than $125,000, the survey found. Others who fall below and above those income brackets also consider themselves middle class, but they represent smaller shares of the pie.

The largest segment of Americans who consider themselves in the middle class are those earning between $50,000 to $75,000, the study found. They represented about one out of five respondents.

"There are people who are in the middle class who would view the person next to them as high net worth," Barsch said. "It's a huge body of people who self-identify in the middle class."

3. Your parents were middle or lower middle class


Seven out of 10 adults who consider themselves middle class say they grew up in households that were either middle class or lower middle class.

About 44 percent said their parents were middle class, while 27 percent said they grew up with lower-middle-class parents. That speaks to some stability between generations, an issue that has been debated given the changes in social mobility over the past several decades.

Research from economist Raj Chetty, for one, indicates that poor children born in certain cities are less likely than their counterparts to climb the socioeconomic ladder, which could be due to issues such as the quality of public schools and the strength of local economies.

Other signs show that some Americans move in and out of the middle class within generations. The survey found that 15 percent of middle-class Americans say they grew up in either wealthy or upper-middle-class households, while 14 percent said their parents were low-income.

4. You are married or have a partner


Americans who are married or have a partner are more likely to say they're middle class. About 85 percent of men with partners or spouses self-identify as middle class, compared with 74 percent of women who also have significant others.

By comparison, only 57 percent of single men and 59 percent of single women said they were middle class.

"Single Americans tended to feel less financially secure," Barsch said. "They are generally holding up the financial picture themselves."

5. You're slightly more optimistic about the economy


The middle class is slightly more likely than the overall population to say the economy will be better this year than in 2016, the study found.

About 47 percent of self-described middle-class Americans said that, compared with 43 percent of the population as a whole.

"With everything that's talked about on the political stage, I was expecting the middle class to be not as positive in their financial outlook," Barsch said. "That surprised me that there is a fair level of optimism, even with some of the upheaval the country has had, but surprising in a good way."

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