• Wizard
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    1 year ago

    Let me get this straight. You don’t consider 3 or 4 times the national median household income “wealthy”? National median household income is about $62k.

    It’s pretty rare for a couple to have two specialized degrees like what you’re mentioning.

    • Jeremy [Iowa]
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      1 year ago

      I’m in IT with no degree. It’s not hard to do.

      I do not consider merely 3x median household as “having a great deal of money, resources, or assets; rich”, no.

      In the current economy, I’d consider it the bare minimum necessary to, say, afford a single-family home built in the last 50 years.

      I’d consider it enough to pay off student loans, to afford a couple well-used cars - and their payments, to afford daycare - enabling starting a family, etc.

      I’d consider it enough for both earners to be able to set aside savings for future earmarked uses e.g. home repairs, retirement, etc., so long as they maintain consistent employment.

      I would not consider it either actively at, or enabling future qualification of “having a great deal of money, resources, or assets; rich”. You could argue it’s at a threshold enabling saving for a rainy day, but there’s no way it’s going to facilitate mass asset acquisition, building a fuck-you-sized cash reserve, etc. That bracket’s money isn’t making them money; that bracket is just as dependent on having a job.

      • Wizard
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        1 year ago

        Alternative question: Do you feel that a household making the median income as “poor”?

        • Jeremy [Iowa]
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          1 year ago

          Alternative question: Do you feel that a household making the median income as “poor”?

          Quite likely, yes.

          If I plug the median (~$62,000) into an income tax calculator and select Iowa to include state tax, the effective annual household income is ~$50k.

          The average mortgage payment as of 2023 (and yes, it should be median ideally, but that wasn’t available) is ~$2,300 per lendingtree.com.

          ~50,000 - (12 * ~$2,300) = ~22,400 annual remaining.

          Playing a bit of hearsay with nerdwallet (and their referenced Experian), the average used car payment as of 2023 is $516/month. If we assume our average family is paying for a car…

          ~22,400 - (12 * ~$516) = ~16,208 annual remaining, or ~1,350 per month… for the entirety of utilities, interest payments, groceries, clothes, school-related/extracurricular (for any kids), daycare, etc.

          But let’s look at it from the other side - if we don’t assume these averages, here’s what your median household is looking at.

          ~50,000 / 12 = ~$4,166/month… for the entirety of mortgage, any auto payment, any fuel/maintenance, any home improvement/supplies/maintenance/repairs (hope that water heater doesn’t go), any groceries, any utilities like water, gas, electric, internet, cellular, any day care costs, any costs of kids education / extracurricular activities, etc. This is expected to somehow cover 2+ people.

          Yes - I’m pretty confident in stating that the median household income is likely to be lacking sufficient money to live at a standard considered comfortable or normal in a society. Or, if poor is to be directly compared to wealthy, I’d say they’re exceedingly unlikely to manage having a great deal of money, resources, or assets; rich.

          I feel attempting to tie concepts such as poor and wealthy to arbitrary points of income is largely futile, as the real indicator would be the relative ability of a household to cover average/expected expenses and save/amass cash.

          That previous “top 10%” benchmark of ~$210,000 will be pulling ~$153,000 annual/$12,750 monthly after taxes. Subject it to the same considerations- average mortgage, average car payment, etc. - and they’re looking at $119,200 annual/$9,900/month.

          I’d say they’re much less likely to be in the situation defined by poor - factor in the entire gamut of expenses and they’ll still have some discretionary income - but they’re also not at the point of qualifying as wealthy. At best, they’d be able to retire more comfortably.

          Compare this to, say, the $995,000 pre-tax / $593,251 after-tax annual / 49,437 after-tax monthly of the 1% margin and that… changes. The relative gap between the entire gamut of usual expenses and actual monthly income is immense; wealth aggregation is almost unavoidable.

          That’s wealthy.

          Edit: Per latest Census Bureau data, the median household income in the US is ~71,000, compressing the gap between them and that “top 10%” a bit.