1,020, $3K, $100K, $102K and $450K

1,020

I am hardly alone in receiving more emails than I can possibly handle.

I have been getting absolutely slammed with them at work, averaging nearly a hundred per day, and not just the typical newsletters and real estate listings that come at me every few minutes 24/7.  I have been getting about twenty per day from actual businesses that exist in the town where I work and from brokers and service providers from every corner of the economic development market in the northwest suburbs of Chicago.

So here I am on Saturday morning, November 4th, after a long, difficult and stressful workweek and want to check on my personal Yahoo! emails, and there you have it.  1,020 more unread emails in the past two weeks since I last cleared them.

1,020 unread emails since two Saturdays ago

I actually received about ten more than that, since I have looked at and responded to about a dozen or so that were from actual people like my wife and mother, the two people who email to me the most.

Ninety percent or more of these emails are newsletters of some sort, some which I subscribed to and some that just began showing up without me asking for them.  The consistent number of receiving about 500 emails every week or 1,000 every two weeks in my Yahoo! account averages out to around seventy per day.

1,020 in fourteen days is about 73 per day.

My wife says its no big deal.  She gets about the same amount per day and typically clears them every week or so, saving a few and then tapping the handy “delete all” button, erasing hundreds at a time.

I receive so many things that I want to read and so many things that I feel I should keep for future reference, so I have about twenty folders that I put many of these emails in.  Of course, I have folders with hundreds of emails in them that I never look at and probably never will.

One of my many resolutions for this coming year is to unsubscribe.  My preliminary goal is to “unsubscribe from thirty-five.”  It has a nice ring to it, but considering how many emails I get slammed with at work and at home, I may be better served to unsubscribe from forty-five or, better yet, fifty-five because that averages out to at least one per week.

$3K

Just sharing a bit of my financial pain today.

Did I mention that our bills have been high for this Middle Class Guy?  If not, I am writing that here.

Going back once again to the many articles detailing how many families would struggle to pay an unexpected $500 or $1,000 or $2,000 expense, I previously wrote how it is rare for my family to go a month without that type of expense.

It seems odd writing about this as the temperatures in the Chicago area plummet to the forties, but there was a string of days in early September when the temperature was in the nineties.  That is when our central air unit finally gave out after having been nursed along for the past four or five summers by our great HVAC guy.

This time, after fixing it with yet another new belt, it gave out a day later and he could no longer just keep patching it together.  The good news is that we now have a brand-new energy efficient air conditioning unit that barely makes a sound when it is on and cools our home quickly.  The bad news is that I just had to pay my wife’s credit card bill that is due next week, to the tune of over $3,000.  $2,450 of that goes to our HVAC guy, and we do not get one mile or point for it.  We had about $9,000 in our checking account this morning, and one-third of that has been transferred to Bank of America.

I paid B of A $3K out of our $9K in checking this morning.

$100K

In late October, there was a spate of articles questioning whether a family making $100,000 is middle class.  One in the Washington Post and another on the CNBC website point out that Nationwide, the average American family currently makes about $74,000 a year before taxes, according to the Bureau of Labor Statistics, and the median American income is $59,000 a year.

The articles also acknowledge that it’s also situation specific. “The more people in a family, the more money they typically need to live a comfortable middle-class lifestyle,” writes the Post. Likewise, the more expensive your area, the more you need to make to qualify. Overall, “America’s middle-class ranges from $35,000 to $122,500 in annual income, according to The Post’s calculation” approved by the Pew Research Center.

As the primary breadwinner in a family that clears a little bit more than $100K, likely approaching $120K this year, I can report here and now that we are extremely middle class, perhaps even the epitome of it.  Notice this blog’s name.

Although we pay for our son’s private college and I am also paying for several upcoming Disney World trips, we drive old beater cars, watch tube TVs and use pay-as-you-go phones.  We have an HMO that basically sucks, and my wife has to fight to get them to cover several healthcare bills from an episode this previous summer.

Most months, more money is going out than coming in.

Twenty years ago, I would have thought that with an income of over $100K that we would have it made in the shade.  That is hardly the case.  I will not bore you with the details of our typical suburban middle class lifestyle, but suffice it to say that considering our property tax bill of a Benjamin per week, paying for our son’s private college, sending money to our retirement accounts with every paycheck, eating out far too much but really just an average amount for a middle class American family, all the additional expenses of our children’s activities, our income does not stretch so far.

Is $100K a middle class income for a family of four?  You betcha!

$102K

After contributing to several accounts with T. Rowe Price for many years, this is about the last month that over $100K will be in our accounts.  A bit over $102K to be exact.

For many struggling middle class families, accumulating six figures in an investment account would be a major accomplishment.  For many others, having only that amount when approaching the age of forty-seven would be highly embarrassing.

Using the many formulas of how much money one should have accumulated by a certain age, that is somewhere between one-fourth and one-fifth of how much I should have saved by now.  My wife and I do have some other investment accounts which altogether have another seventy grand or so, but the bulk of our eggs are in this basket.

Our son’s College 2018 portfolio is included in this amount, and I have been drawing about $2,000 per month from it most months.  With November upon us and the upcoming transfer, along with another one thousand dollar transfer for some much-needed travel funds from my GNMA “savings account,” this will dip back into five figures by the end of this year.

When I Pay Myself First, I am sending money to my Roth IRA account, which is held in this and split between two excellent funds that I would highly recommend: The Capital Appreciation fund and the Blue Chip Growth fund.

Just over a year ago, I had nearly $150K with T. Rowe Price, but after having to pay quite a bit in tuition and having repaid some money previously withdrawn from the Cook County pension fund, this account has dwindled month after month and it pains me to report this.  But I am proud to say that we intend to get both of our children through their undergraduate years with little to no debt.

I would love to tell you that I have half a million or more in this account and then tell you how I accumulated so much but the truth is that I have $102K in it and when 2018 starts, that number will be below $100K for the first time in years.

$450K

A few mornings ago as I dragged myself to a long, stressful and rainy day filled with meetings and assignments from my young new boss, my wife told me that she was reading an article on her phone about the GOP claiming that families earning up to $450,000 should be considered middle class.

The Tax Policy Center defines the middle class as people earning between $48,300 and $85,600 a year.

The GOP made the announcement as part of the rollout of the tax cut plan, saying they would cut tax rates from 39.6 percent to 35 percent for those $450,000-earning middle-class members

WTF?!

Isn’t $450K in one year about nine grand per week?  Isn’t that amount about eight times as high as the median household income in the U.S?  Isn’t that more than a typical engineer married to a school principal would make?  Or most lawyers and doctors?

$450,000 is a very high upper class income in my view.  Through my work, I  know several business owners who make that much, some of them higher.  Some  much higher.  These people travel the world extensively, own multiple homes, luxury vehicles, watches that cost more than my entire family’s wardrobe and cars with wheels worth more than my car.

I have an uncle who earned in this range and above for many years, and their home and lifestyle could definitely be viewed as upper class.  Most middle class families cannot take their family of five, plus a fiancee or two, through Europe for six weeks while lodging and dining at some of the top places.  Some years my uncle made considerably more than $450K.  By the way, I love my aunt and uncle.  They would be offended if you called them rich or upper class, but even they would have to admit to being fairly wealthy.

Another thing about my uncle.  He is a CPA and an MBA and worked his ass off, many weeks over eighty hours, as a finance executive for a software firm.  Like me, he is Jewish and his parents pushed him and his brother to pursue higher education as a means to greater success than they enjoyed.  His father owned and operated a gas station.

As the Middle Class Guy blogger, I read every article defining the middle class that I can find and, let me tell you, $450K is more than three times as high as what most would consider the highest middle class income.  Fewer than ten percent of all United States households have an income higher than $150,000 – and the nation’s median household income is just over $50,000.

I can only dream of earning $450,000 in one year.  It would take me nearly four years at my current pace to earn that much.  I certainly would not waste my time blogging if I could earn that much.  I either would not have the time, working at a law firm or successful medical practice, or would be so busy running my own business that why would I waste the time?

I’ll tell you one thing: an income of $450,000 is about twice as high as I would consider the top middle class income.  My wife and I have several friends where both the husband and wife earn right around one hundred grand.  They live good lives, but they are still middle class, albeit upper middle class.  Nice cars, nice vacations, good restaurants, nice clothes but nothing that would kick them into upper class status.

One question for you since I do not know who you are or your own circumstances.  You may have a half mil in investments like I would like to and you might make twice as much.  Or you may still be just thinking about investing or working on your first twenty grand stashed away or just scraping by on thirty or forty thousand per year.

My question is at what income would you consider a family to have moved from middle class to upper class status?

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