Is Your Income Considered Upper, Middle, or Lower Class?

Salaries also run deep within the United States, some way over others. Ever wonder where your income places you amongst social classes? Here’s a breakdown using 2022 U.S. Census Bureau data:

What Income is Needed for Upper, Middle, or Lower Class?

Here’s a look at the income range needed to qualify into each class:

• Lower Class: This is the lowest 20% of earners with incomes at or below $30,000.
• Lower Middle Class: Families falling between the 20th and 40th percentiles, with incomes ranging from $30,001 to $58,020.
• Middle Class: Families that fall between the 40th and 60th percentiles have incomes from $58,021 to $94,000.
• Upper Middle Class: Families falling between the 60th and 80th percentile will have incomes ranging from $94,001 and $153,000.
• Upper Class: The top 20% of earners will be considered, earning $153,001 or more.
  Let’s go over these numbers and determine which class you fall into based on your income. Keep in mind that your class is not fixed; as your income changes over time, so too can your class.

Getting the Most of Your Money

It is not only a matter of how much you take home but also of how smartly you handle your money. Following are a few tips that will assist you in getting the most from your money:

1. Budget Wisely: Draw a budget, and live within your means.
2. Build an Emergency Fund: Set aside three to six months of living expenses in a high-yield savings account for those surprise expenses.
3. Automate Your Investments: Set up automatic investments into a retirement account, including a 401(k) or an IRA, where the money you invest will grow over time.

Improving Your Financial Circumstances

Aside from smart money management, here are ways to improve your income:

1. Learn New Skills: Certifications or skills that relate to your industry can help promote you to a higher position or increase.
2. Consider a Side Hustle: The average side hustle pulls in approximately $483 a month, extra income that can be helpful.
3. Work Extra Hours: Overtime is a good addition to an income if time and a half apply.
4. Negotiate Your Salary: Most people receive higher pay when they actually negotiate. Use industry salary data to back your request.

Invest Strategically

1. Begin with Retirement Accounts: Utilize 401(k) or an IRA, especially if your employer grants matching contributions. It’s a tax-advantaged account that lets your investments grow further.
2. Diversification: The investors need to spread investments across different asset classes such as stock, bonds, and real estate. It minimizes the risk. In fact, diversification helps protect your portfolio against market volatility.
3. Invest in low-cost indexed funds and ETFs: These are low-cost, broadly diversified, and an excellent vehicle for long-term growth that outperforms most managed funds over time.