Money

84% of Americans agree on the one factor that defines the middle class

What defines the American middle class? The answer can vary wildly depending on who you ask.

For some, it's a mindset and work ethic. For others, it comes down to living a certain lifestyle. And, for many, it's strictly about how much you earn.

These days, that's the most popular answer. 84 percent of Americans agree that the defining characteristic of the American middle class is income or assets, according to Northwestern Mutual's 2017 Planning & Progress Study.

Lifestyle and perspective are key elements of being middle-class as well, according to 70 percent of survey participants.

And yet, while most Americans agree that income defines the middle class, many miss the mark when it comes to understanding exactly how much money that is.

Although Northwestern Mutual's study found that 70 percent of Americans consider themselves middle class, a 2015 report from Pew Research Center shows that the middle class has been shrinking over the past four decades and now makes up only 50 percent of the United States' total population.

Of the survey participants who labeled themselves as middle class, 50 percent earn between $50,000 and $125,000 annually. The actual dollar amounts needed to qualify as middle class are slightly lower. Pew Research Center defines it as adults whose annual household income is two-thirds to double the national median, which was $55,775 as of 2016.

That means singles making between $24,000 and $72,000 annually are middle class by 2016 standards. The median household income in the U.S. recently rose to $59,039, so the new parameters are slightly higher when adjusted for household size.

A few common mindsets also bind together those who consider themselves middle class, Northwestern Mutual found. In general, people in the middle class are:

  • More likely to believe in the attainability of the American Dream. While 55 percent of middle-class survey respondents say they believe in the American Dream, only 48 percent of the general population say they do.
  • More likely to have a clear and accurate picture of their finances. While 71 percent of middle-class respondents feel as though they have a clear picture of their finances, only 64 percent of the general population say they do.
  • More likely to feel very financially secure. While 58 percent middle-class survey respondents say they feel financially secure, only 47 percent of the general population say the same.

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