Define Rich, Poor, Middle Class, Working Class

[dmcummins]

I hear these terms constantly during all the political crap. Just when does someone become Rich? Is it when they have an income of 200K a year or does one need some assets as well. What income is considered Middle Class? Is it somewhere between 20K and 200K? Working Class really has me confused, its it anyone who is working or just someone who has to work to get by. It seems like both sides are always wanting to take care of the Middle Class and Poor. Im just wondering who that really is.

I want to make sure I know where Im at so I can get the most help.

[RallyJon]

Rich = wealth. Can you afford to not work and live off investments? Then you're rich. In most parts of the country, that's a net worth of $3+mm. In CA or Eastern cities, maybe $10+mm

Upper middle class = living well, but working for it. Depends entirely on where you live, number of dependents, etc. You cannot put an income number on it without taking those variables into account. $200k/year is doing very nicely if you live in Louisville, KY, it's near the poverty line in NYC.

Middle class = doing OK, but passing on some of life's luxuries. I'd estmate household income of $50-150k depending on where you live and--again--number of dependents.

Working class = Struggling a bit, watching your money, shopping at Wal-mart, not the mall. Working extra jobs to make ends meet. Not saving enough. Etc.

Poor = well, less than that.

I want to make sure I know where Im at so I can get the most help.

Hah! I guarantee the people who'll give you "help" will adjust those classifications generously--and not in your favor.

[dmcummins]

When Bush and Kerry say they are going to take care of the "middle class", who are they talking too?

[RallyJon]

I think they use the term "take care of" the same way John Gotti would have.

[turbo6bar]

Rich = ability to live well through smart planning. These individuals are able to work the system to their advantage. I classify rich as the top 0.5% of Americans. There's emphasis on assets instead of income.

Middle class = everyone who is not poor or rich

Poor = have trouble finding water, food, and shelter

Naturally, since you can't squeeze the poor for taxes, and the rich can defer income or rely on favorably-taxed assets, the government must stick it to the middle class.

[widebody911]

Originally posted by turbo6bar
Naturally, since you can't squeeze the poor for taxes, and the rich can defer income or rely on favorably-taxed assets, the government must stick it to the middle class.

Good synopsis, but I'd like to add that in order to preserve their class status, the rich must push the rest further down the ladder. This ensures a ready supply of cheap labor, and if the middle-class were to get too 'uppity' they would find themselves competing against them for tax shelter. At the same time, they need to make them think they're rich, so they can be counted on for political support. Sounds twisted, but that's the way it is. One of the rags did a survey which found that 20% of the people thought they were in the top 5% in terms of wealth.

[cowtown]

Originally posted by widebody911
in order to preserve their class status, the rich must push the rest further down the ladder.

If this were true, the economy would not expand every year. If it were a zero-sum game, the average per capita GDP and per capita income would not change year to year. But those things increase over time. The rich can get richer without it being at your expense.

[widebody911]

Originally posted by cowtown
If this were true, the economy would not expand every year. If it were a zero-sum game, the average per capita GDP and per capita income would not change year to year. But those things increase over time. The rich can get richer without it being at your expense.

I suspect the only reason the main economy is 'expanding' is the Fed keeps printing more greenbacks.

[304065]

I suspect the only reason the main economy is 'expanding' is the Fed keeps printing more greenbacks.

We are in a period of historically low interest rates. The Fed, through control of the Fed Funds rate and reserve requirements, has been expanding the money supply dramatically.

And yet we have NOT seen inflation as a result. (Commodity prices aren't included in the definition)

Somebody smarter than me suggested that this is due to offshoring of jobs putting a cap on wages domestically, preventing inflation from occurring at home.

Either way, the Fed's been standing on the gas pedal of money supply expansion for a while now: look at the 10-year.

[dmcummins]

It's just interesting that you hear these terms daily but they still have different meaning to different people. Don't most people that are retired, are living on investments or pension, but would not be considered rich. And are the top .5% really there because they "work the system" , or do they do that once they are "rich".

Do you really think that most of the wealthy got there by screwing the poor and middle class or did they possibly get their on their own.

I personally plan on living what I would guess most would consider a upper-middle class lifestyle. I don't have the 3 to 10million in investments but I have no debt and I have a nice new home. I feel that I am rich because I'll now have time to do what I want. But I'll have to get by on 80k to 100K a year so I guess thats middle class. Since Im going to quit my job I guess I'll also be considered unemployed. I wonder if I can get unemployment benefits ?

I guess Im just burned out. I realized that by reducing my income my taxes go way down and I start getting some deductions back. I should have done this a few years ago and maybe my kids could have gotten some college money.

I sure hope whoever gets elected and helps out the middle class at least gives me a kiss before bending me over.

[TerryBPP]

Also depends on the age sample. If you're 25 and your income is $75,000 them I would say you're just as wealthy as a 50 yr old making $200,000. Wealth is usually grow linearly.

I know this is almost OT. Just food for thought.

[turbo6bar]

Originally posted by dmcummins
It's just interesting that you hear these terms daily but they still have different meaning to different people. Don't most people that are retired, are living on investments or pension, but would not be considered rich. And are the top .5% really there because they "work the system" , or do they do that once they are "rich".

The question is does it really matter?

I would say an older retired person living on a pension is not necessarily rich. They had to pay into the system in their early life to obtain the payback later in life. Their livelihood is still dependent on someone else.

I never implied the 0.5% got there because they work the system. I am saying that the truly rich know how to make their money work for them-- in essence, work the system. They are able to project wealth with good sense. VP candidate Edwards uses a S corp. to reduce Medicare/Medicaid payments. That's smart. That's rich. Guy Smalley, owner of We Gotcha Repo Service, takes in $170k/yr. He doesn't use creative or smart tax and wealth planning, and subsequently pays a huge percentage in taxes. Someone might say Guy is rich, but he's a dupe, compared to Edwards. Edwards = rich. Smalley = middle-class. In my opinion, rich is not about income.

In the end, does it really matter? If you're not in the echelon, and you're not destitute, you're one of the guys and gals in the middle. The country needs us to stay afloat.

[tabs]

Rich is not going out and buying a new GT3....but going out and buying a Carrera if your so inclined...

I don't work for a living, but live on my investment income...does that make me rich?

Money is a funny thing....