Author Topic: The Secret Shame of Middle-Class Americans  (Read 216195 times)

FINate

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The Secret Shame of Middle-Class Americans
« on: April 19, 2016, 10:41:16 AM »
http://www.theatlantic.com/magazine/archive/2016/05/my-secret-shame/476415/

Nearly half of "middle-class" America would struggle to come up with $400 to cover an emergency.  Whatever savings we do have goes to things like weddings ("We have no retirement savings, because we emptied a small 401(k) to pay for our younger daughter’s wedding.")

Not scolding the guy - he admits that he's made the mistake of living beyond his means for too long and it seems he's working hard to correct this. At the same time, he's giving people an out by putting blame on banks/CC companies, universities, etc. Now, I'm no fan of these entities, I think they're all blood suckers. But the sad reality is that no one *really* cares about your finances other than you. Politicians only care about getting reelected, and no one wins elections by talking about responsibility and financial independence. Besides, all the politicians are in cahoots with these industries. So I don't see much hope of this being solved at a policy level.

Perhaps the overarching problem is that the "middle-class lifestyle" has inflated beyond what we can afford, and people just assume this is how they're expected to live. You don't need to send your kids to expensive universities, or drain your retirement account to pay for weddings, or put your kids in private schools, or buy cars on credit, or pay for cable or expensive phone plans. It's unfortunate that he doesn't advocate for a different perspective on our lifestyles and instead ends the article with a defeatist tone: "What so many of us have been suffering for so many years may just seem like a rough patch. But it is far more likely to be our lives."

MgoSam

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Re: The Secret Shame of Middle-Class Americans
« Reply #1 on: April 19, 2016, 10:45:40 AM »
47% of Americans? Must be the same people that Romney was referring to.

RFAAOATB

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Re: The Secret Shame of Middle-Class Americans
« Reply #2 on: April 19, 2016, 11:20:25 AM »
The Middle class life is not available to 60% of Americans.  So now in order to have a decent retirement and not be drowning in debt, I'm pretty much living like a poor most of the time.  I don't really WANT to live like a poor, but have the ability to defer gratification to a certain degree.  Telling people not to live above their means or reduce their desires doesn't seem to help for the majority for some reason.  It also doesn't help that it seems to take a lot more means to have a good house, two good cars, vacations, kids, and a safety net these days.  Right now I only have a meh house, one car for two adults, a small safety net, and working on yearly vacations and trying for a kid.  I am living less large than my parents and it sucks.  How the majority deals with this problem is going to be a struggle.

Two different goals/questions:
Are you living more or less large than your parents at your age? 
Do you have a better net worth than your parents at your age? 

If the rich keep getting richer, and that ain't you, then how rich do you need to be to be in that positive feedback loop?

ShoulderThingThatGoesUp

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Re: The Secret Shame of Middle-Class Americans
« Reply #3 on: April 19, 2016, 11:39:39 AM »
If you want to live a 1972 lifestyle it would really be quite cheap.

infogoon

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Re: The Secret Shame of Middle-Class Americans
« Reply #4 on: April 19, 2016, 11:42:20 AM »
TL;DR version - "It's expensive to live in the Hamptons, and you probably shouldn't try to do it as a freelance writer with unpredictable income."

RFAAOATB

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Re: The Secret Shame of Middle-Class Americans
« Reply #5 on: April 19, 2016, 12:14:41 PM »
Another way to look at it.  It's easy to be poor.  You don't have money to worry about.  It's easy to be rich.  You don't have to worry about money.  How do you be middle class?  How do you know what's reasonable for houses, kids, cars, college, vacations, retirement, and everything else?  If you base it on your peers, and most of your peers are putting up a happy front, then you get an unrealistic baseline.  If you base it on your parents, and your economy is worse than theirs was then you get the feeling you are falling behind.  We may be smarter than average, but these average numbers are pretty dumb.

TheAnonOne

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Re: The Secret Shame of Middle-Class Americans
« Reply #6 on: April 19, 2016, 12:22:30 PM »
The Middle class life is not available to 60% of Americans.  So now in order to have a decent retirement and not be drowning in debt, I'm pretty much living like a poor most of the time.  I don't really WANT to live like a poor, but have the ability to defer gratification to a certain degree.  Telling people not to live above their means or reduce their desires doesn't seem to help for the majority for some reason.  It also doesn't help that it seems to take a lot more means to have a good house, two good cars, vacations, kids, and a safety net these days.  Right now I only have a meh house, one car for two adults, a small safety net, and working on yearly vacations and trying for a kid.  I am living less large than my parents and it sucks.  How the majority deals with this problem is going to be a struggle.

Two different goals/questions:
Are you living more or less large than your parents at your age? 
Do you have a better net worth than your parents at your age? 

If the rich keep getting richer, and that ain't you, then how rich do you need to be to be in that positive feedback loop?

This is horribly full of self-pity.

Am I living (at age 25) a better or worse life than my parents at 25? Through technological advancements I carry around the sum of human knowledge in my pocket. So I would say better.

 
The "Middle Class" lifestyle is a ridiculous notion. In the 40s->60s it was a small house (900sqft) and one car (if you were lucky) Mom couldn't work because it wasn't right and minorities had a rough time doing basically anything.

You have an awfully rosy picture of the past.

Drifterrider

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Re: The Secret Shame of Middle-Class Americans
« Reply #7 on: April 19, 2016, 12:25:10 PM »
.  If you base it on your parents, and your economy is worse than theirs was then you get the feeling you are falling behind.

My parents had one TV, one phone, no cell, no computer, no internet.  We seldom went out to eat.  They didn't always have two cars but my father did buy a new one for my mom in 1967 because he left for View Nam and wanted to have something reliable (no A/C).

My mother made and still makes a lot of her own cloths.  My father bought a house in 1956 then rented it to someone else because he could turn a profit and live in a less expensive place. 

My parents saved.  Both worked.  They SAVED.  That is the key.  One can always save something and, if one job doesn't provide for what you need, get a second one (they did that too).

Metric Mouse

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Re: The Secret Shame of Middle-Class Americans
« Reply #8 on: April 19, 2016, 12:28:22 PM »
Another way to look at it.  It's easy to be poor.  You don't have money to worry about.  It's easy to be rich.  You don't have to worry about money.  How do you be middle class?  How do you know what's reasonable for houses, kids, cars, college, vacations, retirement, and everything else?  If you base it on your peers, and most of your peers are putting up a happy front, then you get an unrealistic baseline.  If you base it on your parents, and your economy is worse than theirs was then you get the feeling you are falling behind.  We may be smarter than average, but these average numbers are pretty dumb.

Maybe you should base your lifestyle upon your income, and not on what your parents make or what your peers live like.

ohana

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Re: The Secret Shame of Middle-Class Americans
« Reply #9 on: April 19, 2016, 12:52:52 PM »
It's hard not dismiss what he's saying because 1) he's full of self-pity and 2) he did decide to live in the Hamptons (the poor Hamptons, as he points out, but the Hamptons nonetheless).  Plus if you're on this site you know it's possible to save on a middle class income.  But he's right in pointing out that income is pretty much stagnant for the majority of Americans.

RFAAOATB

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Re: The Secret Shame of Middle-Class Americans
« Reply #10 on: April 19, 2016, 12:58:43 PM »
Maybe you should base your lifestyle upon your income, and not on what your parents make or what your peers live like.

Another way I'm living less large than my parents.  Not making as much (not even inflation adjusted!) means I got to stretch pennies into piano wire to have some semblance of comfort and security.  The subset of forum members here is smarter about money than the general population and can react well to the economic climate. Despite that, aside from technological innovation, it seems things in general are getting worse.

We are equipped with the knowledge and discipline to make financial improvement a reality.  I've got a slightly above median income and a significant above median net worth.  This is more to the fact that median net worth numbers are embarrassingly low than any extraordinary wealth on my part.  What is the general population to do?  All at once improve their discipline and ability to defer consumption until future income can sustain it?  Although that's my plan I don't see it happening on a large scale.

So.... What do we do about the secret shame of Middle-Class Americans?  Unfortunately most people would rather learn from their own mistakes like the author than from anyone else.  I sure did when I had my money problems a few years ago which makes me super risk averse today.

Another long term thing to think about... If the middle class is backsliding, what happens when the middle class shrinks to such a degree that we just have a poor society and a rich society?  Can such a land exist without social upheaval?

golden1

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Re: The Secret Shame of Middle-Class Americans
« Reply #11 on: April 19, 2016, 01:15:22 PM »
Quote
TL;DR version - "It's expensive to live in the Hamptons, and you probably shouldn't try to do it as a freelance writer with unpredictable income."

Yes, this guy is the prime example of what NOT to do in almost every respect.  Part of his problems were just bad luck, but a LOT was bad decisions. 

1) Choosing to be a writer and live in NY.
2) Buying a house in the Hamptons
3) Mortgaging 401K for a wedding.(!!!!!)
4) Having his wife quit her job and become unmarketable. 
5) Insisting on his parents paying his kids college tuition. 

This guy made some really bad choices, and he knows it.  I hope that expensive education that the kids got will help them bail him out when he hits retirement age, because that is about his only option.

What I got out of this article is how easy it is these days to make these bad choices and dig yourself into a hole you can't get out of.  It is very easy to over extend yourself to the point where a minor emergency will drown you.  Everything in this culture pushes you to make terrible choices.

Warlord1986

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Re: The Secret Shame of Middle-Class Americans
« Reply #12 on: April 19, 2016, 01:28:59 PM »
The Middle class life is not available to 60% of Americans.  So now in order to have a decent retirement and not be drowning in debt, I'm pretty much living like a poor most of the time.  I don't really WANT to live like a poor, but have the ability to defer gratification to a certain degree.  Telling people not to live above their means or reduce their desires doesn't seem to help for the majority for some reason.  It also doesn't help that it seems to take a lot more means to have a good house, two good cars, vacations, kids, and a safety net these days.  Right now I only have a meh house, one car for two adults, a small safety net, and working on yearly vacations and trying for a kid.  I am living less large than my parents and it sucks.  How the majority deals with this problem is going to be a struggle.

Two different goals/questions:
Are you living more or less large than your parents at your age? 
Do you have a better net worth than your parents at your age? 

If the rich keep getting richer, and that ain't you, then how rich do you need to be to be in that positive feedback loop?

You can't hear it, but I'm playing you a note on the world's tiniest violin.

You have a home, a vehicle, a safety net with the opportunity to grow, and you take yearly vacations. You bring in more than a median income, and you have more than the median net worth. You're not 'a poor.' 

I don't know how much my parents had when they were my age. I do know they started out with nothing. Mom's wedding dress was $50, and Granddad and Grandmother gave them $200 to make rent that month. Now they have over a million dollars in assets. If I'm frugal then it's very likely that I can do the same.

Your comment about things getting worse is bullshit. In December of 2009 the unemployment rate was 9.9%. In March of 2016 it's 5.0%.  Source: http://data.bls.gov/timeseries/LNS14000000

Things are getting better. The secret shame of the American Middle Class is that they listen to people telling them 'it's not your fault' too much.

FINate

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Re: The Secret Shame of Middle-Class Americans
« Reply #13 on: April 19, 2016, 01:33:42 PM »
Although household income is basically flat, we are better off today as compared to the 1970s. It's not just the advances in computing and that we carry the sum of the world's information around in our pockets, though that plays a large role. We get much more value for our money these days. Let's take automobiles as an example.

In 1972 a new car cost around $3800. Adjusted for inflation, that's about $20,000 in 2016 dollars. MSRP for a Honda Fit is just under $16,000. However, the Fit is a *way* better vehicle. The autos in 1970s were piles of garbage: poor design, unsafe, poor gas milage, bad workmanship (check out the huge gaps in the body on "classic cars"), very very bad operational lifespan before needing MAJOR rebuilds/maintenance. I remember riding around in several year old vehicles back then and I could see the road passing under me through the rusted out floorboards - it was fun to throw stuff through those holes! Nowadays cars are so well built: extremely safe, great fuel economy, long lasting (should get hundreds of thousands of miles), just so much better all around...for about the same amount of money. The low cost and long operating lifespan means that cars actually cost much less now. The same thing can be said of most appliances, building materials, bikes, computers, and so on.

I think the primary culprit is that we are steeped in mass media which 24x7 projects an aspirational image of "middle-class" that is beyond the means of people who would previously be considered middle-class. So people feel poor if they don't drive new cars, or don't take a fancy vacation every year, or don't have the latest clothing styles, or the latest gadgets.

RFAAOATB

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Re: The Secret Shame of Middle-Class Americans
« Reply #14 on: April 19, 2016, 01:56:54 PM »
I think the primary culprit is that we are steeped in mass media which 24x7 projects an aspirational image of "middle-class" that is beyond the means of people who would previously be considered middle-class. So people feel poor if they don't drive new cars, or don't take a fancy vacation every year, or don't have the latest clothing styles, or the latest gadgets.

This is something.  It's a lot easier to look up for inspiration than to look down.  Houses, cars, and schools are some of the fastest ways to lose more money than you planned to.  Curating social media makes the bigs seem normal, which makes normal seem small.  Like most people, I pretty much can afford anything, I just can't afford everything.  Right now although I want the big house, BMW, and Rolex my priority is being a millionaire, which means saving more than spending and living like I'm on the lower side 80% of the time.  The other luxuries are pushed off in the future to "some day" where most other people are pushing their retirement planning.

BlueHouse

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Re: The Secret Shame of Middle-Class Americans
« Reply #15 on: April 19, 2016, 02:23:27 PM »
The author still doesn't realize the extent of the damage he has done and is continuing to do.  The fact that his daughter allowed him to pay for her wedding, even after knowing that her college costs wiped out both her grandparents and her parents retirement savings, astounds me.  But that is clearly a product of her upbringing and she has obviously been taught that the American Dream comes packaged with a bow and a price tag attached. 

I wish he would come on here and do a case study and then implement some of the suggestions that mustachians would give him.  I would enjoy a follow up article if he really tried to make some differences in his life.  I bet he even has cable!

Quote
I know what it is like to subsist for days on a diet of eggs
Boo-hoo, so do I.  I do it every time that I'm left with a carton of eggs that is about to expire because I can't stand the idea of throwing them away.  It's funny what a difference in attitude can do.  When I go days eating the same thing to avoid waste, I think I'm badass.  Unfortunately, the author things he's pitiable for doing it.  Hey, at least you have food with protein! 

mm1970

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Re: The Secret Shame of Middle-Class Americans
« Reply #16 on: April 19, 2016, 02:36:32 PM »
The Middle class life is not available to 60% of Americans.  So now in order to have a decent retirement and not be drowning in debt, I'm pretty much living like a poor most of the time.  I don't really WANT to live like a poor, but have the ability to defer gratification to a certain degree.  Telling people not to live above their means or reduce their desires doesn't seem to help for the majority for some reason.  It also doesn't help that it seems to take a lot more means to have a good house, two good cars, vacations, kids, and a safety net these days.  Right now I only have a meh house, one car for two adults, a small safety net, and working on yearly vacations and trying for a kid.  I am living less large than my parents and it sucks.  How the majority deals with this problem is going to be a struggle.

Two different goals/questions:
Are you living more or less large than your parents at your age? 
Do you have a better net worth than your parents at your age? 

If the rich keep getting richer, and that ain't you, then how rich do you need to be to be in that positive feedback loop?

This is interesting, and I think it would be even more interesting to look at massive statistics.  I had a discussion with someone about this about fifteen years ago.

When I was a kid, my parents:
- Had a small-ish house with one bathroom (1300 sf?) on an acre in the country
- Dad worked, mom stayed at home
- We had 1-2 cars, always old and in some amount of disrepair
- Generally 3-4 kids at home
- We never ate out.  We had a garden.  We never vacationed.  We had one vacation when I was 7, drove to NC to visit an uncle.  2-3 times we went camping (borrowing camping gear) to Lake Erie (1.5 hours away).
- There was no cable TV, only 3-4 stations.  Only hand-me-down clothing.  Never went to movies.
- Socialization was at my grandparent's camp on the weekends
- We had one phone.  No cell phones or internet.
- Regular vacations were not for the middle class.  Only a few friends went on vacation.  Everyone else just drove to go camping.
- The safety net was family and social security
- We did not have health insurance

We were probably poor, but maybe considered lower-middle class?  Looks like for a family of 4, we were making $12k a year, and the poverty level was about $10k.

My husband's family was middle class, and they went on a vacation to Europe every other year, to visit family.


Compared to us - it's kind of hard to pick when to make the comparison.  15 years ago husband was in grad school, I had a job, and we had no kids.  Now we have 2 kids.
- Two engineers with good jobs
- a meh house - much smaller, older than my parents' but in a better location
- meh cars
- an annual vacation or two, but generally keep it to driving/ camping.  Once every other year fly to visit family
- Health insurance (double covered)
- Dental insurance (I rarely could afford the dentist at a kid)
- Vision insurance
- a 401k apiece
- cable internet, two cell phones and even more electronics at home

I guess even with being frugal, I'm way ahead of my parents, but it's kind of an unfair comparison because we both have degrees and are engineers (my dad was a mechanic, my mom was a SAHM and then went back to work as a bank teller)

A more fair comparison would be my brother and SIL who still live in my home town.  Two decent jobs (prison guard and at a bank), vacations to Disneyland, a house with a crappy kitchen that they cannot "afford" to upgrade, lots of nice new clothes.  New cars.  State pension.  They live pretty large though, and eat out a ton.

While I don't disagree that times are, in many ways, tougher than they used to be.  I must admit that *most* people I encounter aren't comparing apples to apples.

Cell phones and internet for one thing.  I would never suggest that someone not have these items (though five years ago, I did not have a cell phone).  But it seems like people are used to a better quality of things.

But even past cell phones and internet.  Cars are bigger.  They use more gas.  They are newer.  My parents once owned 2 Fiats!  Nobody had a truck, SUV, or minivan.  Every car was bought used.  Every one.  New clothing?  I got my first new winter jacket in 10th grade.  I owned 2 pairs of shoes, hand me downs were gathered FIRST.  And we never ever ate out.  Maybe once a summer we would get soft serve ice cream at the burger place.  And during "back to school shopping" (where we would each get 1 shirt, new socks, and 1 pair jeans), we would have lunch at McD's.  Except for those 2-3 years where we were not even allowed to go shopping with mom, because we couldn't afford McD's.

And health insurance - we didn't have any.  We paid cash for the crappy dentist and the doctor.  But paying for our own health care came before "wants" like vacations, TV, etc.

fattest_foot

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Re: The Secret Shame of Middle-Class Americans
« Reply #17 on: April 19, 2016, 02:41:04 PM »
The economist quoted pretty much summed it all up, despite missing his own point:

"According to Johnson, economists have long theorized that people smooth their consumption over their lifetime, offsetting bad years with good ones—borrowing in the bad, saving in the good. But recent research indicates that when people get some money—a bonus, a tax refund, a small inheritance—they are, in fact, more likely to spend it than to save it. “It could be,” Johnson says, “that people don’t have the money” to save. "

People spend money they don't have, and then say "I don't have money to save." Yeah, no kidding...you spent it all on discretionary goods.

I can almost guarantee if you ask any 20 or 30 something on the street if they have money to save and they say no, that they also have an iPhone.

mm1970

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Re: The Secret Shame of Middle-Class Americans
« Reply #18 on: April 19, 2016, 02:43:02 PM »
Although household income is basically flat, we are better off today as compared to the 1970s. It's not just the advances in computing and that we carry the sum of the world's information around in our pockets, though that plays a large role. We get much more value for our money these days. Let's take automobiles as an example.

In 1972 a new car cost around $3800. Adjusted for inflation, that's about $20,000 in 2016 dollars. MSRP for a Honda Fit is just under $16,000. However, the Fit is a *way* better vehicle. The autos in 1970s were piles of garbage: poor design, unsafe, poor gas milage, bad workmanship (check out the huge gaps in the body on "classic cars"), very very bad operational lifespan before needing MAJOR rebuilds/maintenance. I remember riding around in several year old vehicles back then and I could see the road passing under me through the rusted out floorboards - it was fun to throw stuff through those holes! Nowadays cars are so well built: extremely safe, great fuel economy, long lasting (should get hundreds of thousands of miles), just so much better all around...for about the same amount of money. The low cost and long operating lifespan means that cars actually cost much less now. The same thing can be said of most appliances, building materials, bikes, computers, and so on.

I think the primary culprit is that we are steeped in mass media which 24x7 projects an aspirational image of "middle-class" that is beyond the means of people who would previously be considered middle-class. So people feel poor if they don't drive new cars, or don't take a fancy vacation every year, or don't have the latest clothing styles, or the latest gadgets.
This is a very good point.  I can't remember which book it was "The Way We Never Were", or "The Two Income Trap" or ???

Anyway, a book I read at some point talked about how it requires 2 incomes to be middle class now.  In some ways, we spend more - housing is more expensive, particularly if you want a decent school district.  Entertainment is cheaper, and cars are a much better deal.  Cars didn't used to survive past 100,000 miles, for example.

fruplicity

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Re: The Secret Shame of Middle-Class Americans
« Reply #19 on: April 19, 2016, 02:43:49 PM »
In my field of work (college finances), I talk to these people every day and it's extremely shocking how much denial there is, and lack of consideration for everyone's future financial security. People look at me and say, "how do people pay for this?" At first I answered honestly with, "well they usually have saved a bit, they lower their expenses and don't put as much in retirement while they're paying for college, and a lot of people borrow loans too." But no matter what I say there is a defensive answer about whatever situation/s befell them to cause their current financial circumstances, and how impossible it is to use ANY of their current income or savings to pay for college, or to put their child in a position to have to work or borrow loans while in school. WTF??? I just want to scream at them, "I pay more than my MORTGAGE annually for childcare and I am STILL saving 15% of my income and paying down my student loans early!! And my coworkers in single-income families have STILL managed to max out their retirement savings years in a row!!!"

It's also getting hard because some of my absolute closest friends seem to be setting themselves up for these situations too. They've bought more house than I imagine they can possibly afford, they have all relied on credit cards, family assistance, and/or borrowing from retirement to make adulthood work (both due to emergencies and lifestyle choices). And most of them have made offhand comments about the comparative modesty of the house we chose to buy. They don't ever talk about money with me although they know my attitude about it. So I know it's really none of my business and we are lucky in our own way, but I can't help fearing for their future, especially when it comes to paying for their kids' educations and retirement. 

One final thought - did anyone else completely not identify with this:
Quote:
"But, without getting too metaphysical about it, these are the choices that define who we are. We don’t make them with our financial well-being in mind, though maybe we should. We make them with our lives in mind. The alternative is to be another person."

Ummm.... huh? My definition of "who I am" is directly intertwined with my financial well-being. Isn't that... the way it should be????
 

Warlord1986

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Re: The Secret Shame of Middle-Class Americans
« Reply #20 on: April 19, 2016, 02:55:31 PM »

One final thought - did anyone else completely not identify with this:
Quote:
"But, without getting too metaphysical about it, these are the choices that define who we are. We don’t make them with our financial well-being in mind, though maybe we should. We make them with our lives in mind. The alternative is to be another person."

Ummm.... huh? My definition of "who I am" is directly intertwined with my financial well-being. Isn't that... the way it should be????

That's the grown-up way of saying: "But I waaaaaaaaaaaaaant it and if you say I made bad choices then you're a meanypants who is denying how special I am!"

That article was disgusting. -.-

Cranky

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Re: The Secret Shame of Middle-Class Americans
« Reply #21 on: April 19, 2016, 03:34:38 PM »
What it takes to be middle class is a lot more stuff than it did when I was growing up - because both my parents and my in-laws were definitely middle class (my family, an engineer and a teacher, once my mom went back to work in the mid-60's) (dh's family, an engineer and a sahm.)

We both grew up in small houses. We had one car families until we were in our teens. We took occasional vacations, mostly to visit relatives, though dh's family made trips to Mexico as they lived in the west. People bought furniture when they got married and pretty much stuck with it, through thick and thin - "decorating" was an upper class thing.

Our parents were able to put all the kids through college and retired comfortably, though quietly, in paid for houses.

And dh and I are the same. We were really broke when we were in our 20's, because we were young. Dh graduated from college with a degree in science and worked in retail. I guess there were some people who got super great jobs right out of college, but we were not them. I worked at a grocery store.

I think that the bar has been raised awfully high, and the more you watch tv, the higher it seems to be. Plus, I suspect that the Hamptons idea of middle class is pretty elevated.

pachnik

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Re: The Secret Shame of Middle-Class Americans
« Reply #22 on: April 19, 2016, 03:45:13 PM »
What it takes to be middle class is a lot more stuff than it did when I was growing up - because both my parents and my in-laws were definitely middle class (my family, an engineer and a teacher, once my mom went back to work in the mid-60's) (dh's family, an engineer and a sahm.)

We both grew up in small houses. We had one car families until we were in our teens. We took occasional vacations, mostly to visit relatives, though dh's family made trips to Mexico as they lived in the west. People bought furniture when they got married and pretty much stuck with it, through thick and thin - "decorating" was an upper class thing.

Our parents were able to put all the kids through college and retired comfortably, though quietly, in paid for houses.

And dh and I are the same. We were really broke when we were in our 20's, because we were young. Dh graduated from college with a degree in science and worked in retail. I guess there were some people who got super great jobs right out of college, but we were not them. I worked at a grocery store.

I think that the bar has been raised awfully high, and the more you watch tv, the higher it seems to be. Plus, I suspect that the Hamptons idea of middle class is pretty elevated.

+1  I had a similar upbringing.  My parents have the same furniture they had when I was a kid 50 years ago.  It is a nice Scandinavian design and they get it recovered every once in a while. 

I agree though that the bar has been raised higher.  It takes more to be middle class now then it did a generation or so ago.  I also think TV/advertising has something to do with it. 

Taran Wanderer

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Re: The Secret Shame of Middle-Class Americans
« Reply #23 on: April 19, 2016, 04:50:58 PM »
Cry me a f&$@ing river...

iris lily

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Re: The Secret Shame of Middle-Class Americans
« Reply #24 on: April 19, 2016, 04:53:27 PM »
TL;DR version - "It's expensive to live in the Hamptons, and you probably shouldn't try to do it as a freelance writer with unpredictable income."
Spit wine, its wne and jokes time!

FireLane

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Re: The Secret Shame of Middle-Class Americans
« Reply #25 on: April 19, 2016, 05:34:43 PM »
I hate to say it, but I have a hard time feeling bad for this guy. Nothing that happened to him was an unpredictable crisis that came out of the blue. He didn't have an expensive health problem, his house didn't burn down or flood, he didn't get sued. All of it was because of decisions he made.

He chose to be a full-time writer, a job with an unpredictable income at the best of times. He chose to live in the NYC region, a high-COL area to begin with, and compounded the expenses by sending both his daughters to private school. He got himself sunk in credit card debt and was making only the minimum payments. When he wanted to move, he refused to slash the price of his current home in a down market, was unable to sell it, and got stuck paying two mortgages for a while. When his wife offered to go back to work, he told her not to and kept her in the dark about their financial situation. He even emptied his retirement account to pay for his daughter's wedding (!!).

There are people who are in bad situations through no fault of their own. This guy just wanted to live like a rich person without the income to match. I live in NYC too, and I'm confident I make more money than he ever did, but I would never take on all the expenses he did.
« Last Edit: April 19, 2016, 05:37:31 PM by FireLane »

Noodle

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Re: The Secret Shame of Middle-Class Americans
« Reply #26 on: April 19, 2016, 06:49:57 PM »
I think part of what happened to this family, and probably many others, was considering all these decisions in isolation instead of as part of the big picture. I mean, individually these decisions (other than paying for the wedding with the 401K, and not communicating openly with his wife) are not so bad--I mean, plenty of people choose to have a stay at home parent, or a job with irregular income or private school for the kids, but the author and his wife should have said OR instead of AND.

Along with all the other forces changing middle class financial behavior in the last couple decades, I wonder if having children later in life makes it harder for some people to accumulate assets. Theoretically, of course, you could accumulate like mad in your twenties and early thirties, and then compound interest takes over to work on your retirement funding while you are spending your current income on day care and piano lessons. But I think many people invest whatever assets they have into their kids when they come along (college tuition being the obvious one, or buying a house in the best school district available). Whereas my parents were younger and poorer during the kid phase, but done with paying for college early on...so everything they accumulated in the last 15 years of working, when they were making good salaries, was available to fund their retirement and also a nice life for themselves. (My parents do not believe in subsidizing children past the bachelor's degree, though, outside of some modest gifts for wedding costs.)

SeaEhm

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Re: The Secret Shame of Middle-Class Americans
« Reply #27 on: April 19, 2016, 06:56:24 PM »
I think the primary culprit is that we are steeped in mass media which 24x7 projects an aspirational image of "middle-class" that is beyond the means of people who would previously be considered middle-class. So people feel poor if they don't drive new cars, or don't take a fancy vacation every year, or don't have the latest clothing styles, or the latest gadgets.

Yup

People surround themselves with social media.  People only project "coordinated" posts on social media that portray a certain positive image.  Therefore, when you look at your feed of your "friends" you think everyone travels, eats out, gets new cars, etc. all the time.  however, this photo pretty much sums this up.



Plus people could be leveraging themselves up to their eyeballs or they could be saving heavily in one area of their life to spend in another.

I feel bad for today's society growing up especially those who are not 100% secure and confident within themselves. 



Tjat

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Re: The Secret Shame of Middle-Class Americans
« Reply #28 on: April 19, 2016, 07:21:29 PM »
To bastardize a quote, "life is a small series choices, the time in between is the consequences"

To me, the author's choices are admittedly poor but rationalized each time in a complainypants fashion.

« Last Edit: April 19, 2016, 07:23:31 PM by Tjat »

SwordGuy

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Re: The Secret Shame of Middle-Class Americans
« Reply #29 on: April 19, 2016, 07:59:14 PM »
The only thing I feel really sorry about is that the author (a) STILL doesn't get it and, more importantly, is (b) misleading others into thinking they can't get ahead either.

Houses are now HUGELY bigger than they were in my parent's day and have way more features.   If we needed something done to the house we tended to do it, today's middle class tends to hire things out (and thus pay more).

We rarely ate out.   I'm sure we most have gone out to eat sometime as a family, but I honestly can't remember ever doing it unless we were traveling somewhere.

The modern middle class buys new cars that cost more than twice what a perfectly good new car costs.   And they buy one for each parent and each child over 16, too.   My parents bought low mileage used cars and I bought my first car from them (for a fraction of its market value).  It was a hand-me-down that I had to put skin in the game for, instead of a new car I got for being born.

Buy few cars that are less expensive, and smaller houses, and do without premium priced cellphones and data plans, and the average middle class budget would start to look a whole lot better.


Cassie

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Re: The Secret Shame of Middle-Class Americans
« Reply #30 on: April 19, 2016, 08:29:41 PM »
So I graduated HS in 1972 and within a few years got married and had a family.  We rented for a few years, my DH worked 2 jobs and we saved for a down payment on an old, crappy house that we could afford the mortgage. WE had 2 old cars and was lucky if one was running.  No eating out, hand me down clothes, only vacations drive to see family, etc.  By this time my parents were doing well but their early years were tougher then ours and managed to do fine as did we.  By age 31 I attend college on $ we saved. Plus we were saving for retirement too.  We took the kids on 1 real vacation for a week to Wash DC. YOu can bet that was a big deal.  People do not want to wait for things-they want all the nice stuff now.  It takes years to obtain them.  My best advice is to hang out with people that are living like you and are not in debt.

calimom

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Re: The Secret Shame of Middle-Class Americans
« Reply #31 on: April 19, 2016, 10:47:12 PM »
Is it just me or does anyone else find the willful ignorance of the writer's wife rather curious? They have made financial mistakes on top of financial mistakes: expensive private schools they couldn't afford, the purchase of a house with an unsold coop, penalties on an 401k (for a wedding!), and yet she doesn't do more than go out and stick her head in the expensive sand by the Atlantic Ocean. Even when heating oil is running out and money has to be borrowed from one of the adult daughters. What are they going to do when the transmission drops on the many-miled Avalon?

I get that the author and his wife are super-special very educated people with high expectations. And as a former film executive, she obviously is not going to get a job at the mini mart this late in life - are they in their 50s would you guess? But is there NO job she can get? Working in a non profit? For the state? Substitute teaching? Something that would live up to their educational specialness and keep the wolf that is pounding on the door?

How do women like this justify their behavior?

TheGrimSqueaker

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Re: The Secret Shame of Middle-Class Americans
« Reply #32 on: April 19, 2016, 11:19:53 PM »
Is it just me or does anyone else find the willful ignorance of the writer's wife rather curious? They have made financial mistakes on top of financial mistakes: expensive private schools they couldn't afford, the purchase of a house with an unsold coop, penalties on an 401k (for a wedding!), and yet she doesn't do more than go out and stick her head in the expensive sand by the Atlantic Ocean. Even when heating oil is running out and money has to be borrowed from one of the adult daughters. What are they going to do when the transmission drops on the many-miled Avalon?

I get that the author and his wife are super-special very educated people with high expectations. And as a former film executive, she obviously is not going to get a job at the mini mart this late in life - are they in their 50s would you guess? But is there NO job she can get? Working in a non profit? For the state? Substitute teaching? Something that would live up to their educational specialness and keep the wolf that is pounding on the door?

How do women like this justify their behavior?

With tears, whining, and an appeal to Tradition. The tradition part is historically inaccurate, but you can't expect a super-special very educated person to read history.

jengod

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Re: The Secret Shame of Middle-Class Americans
« Reply #33 on: April 20, 2016, 12:49:46 AM »
This is the author's Wikipedia page, FYI:

https://en.wikipedia.org/wiki/Neal_Gabler

Squirrel away

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Re: The Secret Shame of Middle-Class Americans
« Reply #34 on: April 20, 2016, 01:17:29 AM »
Wow, that was long.:D

It seems obvious to say, but if you are scraping by like that you are not middle-class.

Ann

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Re: The Secret Shame of Middle-Class Americans
« Reply #35 on: April 20, 2016, 02:02:43 AM »
Some economists attribute the need for credit and the drive to spend with the “keeping up with the Joneses” syndrome, which is so prevalent in America. I never wanted to keep up with the Joneses. But, like many Americans, I wanted my children to keep up with the Joneses’ children

How.... Is that not the same?

That was a decent piece of schadenfreude.

Also, I don't get why in this age anybody just expects parents to pay for their wedding.

HenryDavid

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Re: The Secret Shame of Middle-Class Americans
« Reply #36 on: April 20, 2016, 07:27:10 AM »
"He knew it and did it anyway."

Without THIS, we would have no novels, no King Lear (!), no entertaining thought-provoking self-created tragedies.
Life would be calm, smooth, zen.
On some level, people always DO know it, and do it ANYWAY.
They go home with that person, they postpone that call, they buy that car, they marry that person, they take that job, they let their kids get away with that one thing . . ..
There is a small voice inside saying NOOOOO, but it's surprisingly easy to shut that voice UP.
"Pipe down, voice of reason!"
And then it gets harder to hear it the next time.
People gotta turn off the phone/internet/what have you and settle down by themselves long enough to hear that voice. But they don't.
So they "know it and do it anyway." Very human.


Eric222

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Re: The Secret Shame of Middle-Class Americans
« Reply #37 on: April 20, 2016, 07:37:18 AM »
This article provoked a profound sense of cognitive dissonance for me.  I've been at the "shit, I don't have enough money - what do I do now point," so I understand the sense of self-pity entangled with embarrassment that oozes from the article.  I had a wife that was willfully ignorant of our financial situation and I tried to think about it as little as possible.  I was financially literate - I just couldn't make myself spend the amount necessary to live on what I had.  That being said, it was all a result of choices I had made, then failed to learn from, and continued to make.  I wasn't able to own up to the fact that it was my responsibility until about a year ago. Once I was able to do that, things started improving.  But as long as you are blaming flat wages, being in a HCOL area, university tuition, etc, nothing is going to change. 

Now I see things like this and I want to yell at the writer - IT ISN'T TOO LATE!  He seems so defeated and resigned. You can always turn things around.  Past is prologue, but it isn't absolute destiny. 



dude

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Re: The Secret Shame of Middle-Class Americans
« Reply #38 on: April 20, 2016, 07:58:29 AM »
Quote
The Bankrate survey reported that nearly half of college graduates would not cover that car repair or emergency-room visit through savings, and the study by Lusardi, Tufano, and Schneider found that nearly one-quarter of households making $100,000 to $150,000 a year claim not to be able to raise $2,000 in a month.

WTF???

partgypsy

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Re: The Secret Shame of Middle-Class Americans
« Reply #39 on: April 20, 2016, 08:28:55 AM »
I'm glad to read this article. Husband and I live in a smallish bungalow (in a nice neighborhood) with 1 used car surrounded by big new houses and each household having 2 new vehicles, with the kids enrolled in multiple expensive activities. So yes sometimes I wonder, how are they DOING it? How can they afford all that? So, maybe for some of them, this is the answer.

While we don't have as much material things our mortgage balance is 65K, have 5K in savings and a net worth around 300K. Not as good as many on this forum, but at least we are solvent. 

golden1

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Re: The Secret Shame of Middle-Class Americans
« Reply #40 on: April 20, 2016, 09:15:09 AM »
Quote
"He knew it and did it anyway."

Without THIS, we would have no novels, no King Lear (!), no entertaining thought-provoking self-created tragedies.
Life would be calm, smooth, zen.
On some level, people always DO know it, and do it ANYWAY.
They go home with that person, they postpone that call, they buy that car, they marry that person, they take that job, they let their kids get away with that one thing . . ..
There is a small voice inside saying NOOOOO, but it's surprisingly easy to shut that voice UP.
"Pipe down, voice of reason!"
And then it gets harder to hear it the next time.
People gotta turn off the phone/internet/what have you and settle down by themselves long enough to hear that voice. But they don't.
So they "know it and do it anyway." Very human.

Wise words and very true.  Information is no longer really the problem.  The problem is one of will, self discipline and character.  Or if that isn't really workable in a broad societal level, we need to make systems that encourage us to hear and listen to that voice of reason. 

dude

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onehair

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Re: The Secret Shame of Middle-Class Americans
« Reply #42 on: April 20, 2016, 09:29:40 AM »
I just read that article and my jaw is still dropped open.  I confess it has taken me over a year to save nearly $400 but I had done it in the past before I had to take on the debt so no facepunches please???

But the whole article seemed to be complaining and making no plans to either save or invest even small bits to improve his situation.  Given he's a writer and their incomes can be unsteady but still...


celticmyst08

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Re: The Secret Shame of Middle-Class Americans
« Reply #43 on: April 20, 2016, 11:35:59 AM »
Yeah, I mean, I keep hearing people complaining about how hard it is to be "middle class" now, compared to previous generations. But everyone seems to forget that the definition of middle class has changed. Several decades ago, middle class didn't mean you had a huge house, 2-3 cars, kids in private school, yearly vacations, multiple televisions/smartphones/computers/consoles, etc.

There are valid arguments with how ridiculously the cost of education has risen (although that can still be somewhat mitigated by choosing in-state tuition, community college, working through college, etc), but other than that... I just don't feel terribly bad for people who cry about how hard it is to be middle class.

mm1970

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Re: The Secret Shame of Middle-Class Americans
« Reply #44 on: April 20, 2016, 11:39:15 AM »
I'm glad to read this article. Husband and I live in a smallish bungalow (in a nice neighborhood) with 1 used car surrounded by big new houses and each household having 2 new vehicles, with the kids enrolled in multiple expensive activities. So yes sometimes I wonder, how are they DOING it? How can they afford all that? So, maybe for some of them, this is the answer.

While we don't have as much material things our mortgage balance is 65K, have 5K in savings and a net worth around 300K. Not as good as many on this forum, but at least we are solvent.
This is a good point.  While we wouldn't be considered middle class, I have friends who are.  And they make choices like - having one car, living in a "worse" neighborhood (with worse schools, but they go to a public charter school instead).  Their kids aren't in many activities. They don't travel often (usually driving to visit family).  They have SO MUCH FUN on the weekends, with bike rides, parks, beaches.

Giro

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Re: The Secret Shame of Middle-Class Americans
« Reply #45 on: April 20, 2016, 11:48:33 AM »
I just never understand how possessions are how we determine middle class.  Isn't it income and wealth that should determine middle class.  And I know, everyone thinks they are middle class.

The term is so damn broad and can be defined just about any way possible, we should just throw it out altogether.  Meaningless

Johnez

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Re: The Secret Shame of Middle-Class Americans
« Reply #46 on: April 20, 2016, 11:51:19 AM »
The comment section is pretty encouraging, I don't see a ton of people crying over the unfairness of this guy's suffering.

This guy's situation, along with half the country apparently is reason enough to talk about fixing Social Security and/or figuring out how Gen X and Millenials are going to retire. Ya think the shrieks are bad now that the boomers are hitting retirement? Hell, at least Boomers bought houses, us millenials don't even buy houses! Stagnant wages, and growing health care costs are going to decimate this generation upon retirement.

« Last Edit: April 20, 2016, 11:54:21 AM by Johnez »

golden1

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Re: The Secret Shame of Middle-Class Americans
« Reply #47 on: April 20, 2016, 12:23:58 PM »
That Bloomberg article is good.  I really think that the Atlantic article tapped into another force for consumerism that I see all the time - spending on your kids.

Quote
On the East Coast, affluent parents of bright children explain that they absolutely must live in the best possible school district, and send their kid to the most prestigious possible college. In “flyover country,” parents explain that they have to have a nice new car for the kids, because safety. Also a bevy of very expensive activities, from travel sports to marching band, because otherwise their lives will be blighted. Auto accidents are declining, and bright, motivated kids are probably going to do OK no matter where they go to school. Yet parents can convince themselves to spend near-infinite amounts seeking marginal improvements.

I see people on the East coast who are paying >50% of their take home pay on their mortgage in order to send their kids to the best public schools.  Lexington, MA, for example,  has a median house price of $838,000.  They are also spending thousands on all the trimmings, fancy activities, sleep away camp, expensive sports or horse riding lessons etc...   It is one thing to say no to your own spending habits, it is another to say no to your kids when all of their friends are going on a class trip, or are in a travel sports league etc....  I'm not sure how to stop the arms race on kid related spending, because the drive to have your kids succeed no matter what the cost is really hard to overcome. 

Giro

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Re: The Secret Shame of Middle-Class Americans
« Reply #48 on: April 20, 2016, 12:40:37 PM »
That Bloomberg article is good.  I really think that the Atlantic article tapped into another force for consumerism that I see all the time - spending on your kids.

Quote
On the East Coast, affluent parents of bright children explain that they absolutely must live in the best possible school district, and send their kid to the most prestigious possible college. In “flyover country,” parents explain that they have to have a nice new car for the kids, because safety. Also a bevy of very expensive activities, from travel sports to marching band, because otherwise their lives will be blighted. Auto accidents are declining, and bright, motivated kids are probably going to do OK no matter where they go to school. Yet parents can convince themselves to spend near-infinite amounts seeking marginal improvements.

I see people on the East coast who are paying >50% of their take home pay on their mortgage in order to send their kids to the best public schools.  Lexington, MA, for example,  has a median house price of $838,000.  They are also spending thousands on all the trimmings, fancy activities, sleep away camp, expensive sports or horse riding lessons etc...   It is one thing to say no to your own spending habits, it is another to say no to your kids when all of their friends are going on a class trip, or are in a travel sports league etc....  I'm not sure how to stop the arms race on kid related spending, because the drive to have your kids succeed no matter what the cost is really hard to overcome.

Yes, it's hard not to want the "best" for your kids.  But, the best is not usually had at a price.  The best is a stable family, time at home to study and be encouraged. family activities together.  You do NOT need 800K house to provide the "best" life for your child.  We live in a shitty district so I do send my kid to private school...but it's 4500 bucks a year.  I saved at least 150k on my house.  I can afford to spend a couple thousand on school for a few years.  Once she has a solid foundation and study habits, she can go to a public high school.  Drowning yourself in debt is not how to provide a good foundation for your child.  IMO


partgypsy

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Re: The Secret Shame of Middle-Class Americans
« Reply #49 on: April 20, 2016, 12:45:38 PM »
That Bloomberg article is good.  I really think that the Atlantic article tapped into another force for consumerism that I see all the time - spending on your kids.

Quote
On the East Coast, affluent parents of bright children explain that they absolutely must live in the best possible school district, and send their kid to the most prestigious possible college. In “flyover country,” parents explain that they have to have a nice new car for the kids, because safety. Also a bevy of very expensive activities, from travel sports to marching band, because otherwise their lives will be blighted. Auto accidents are declining, and bright, motivated kids are probably going to do OK no matter where they go to school. Yet parents can convince themselves to spend near-infinite amounts seeking marginal improvements.

I see people on the East coast who are paying >50% of their take home pay on their mortgage in order to send their kids to the best public schools.  Lexington, MA, for example,  has a median house price of $838,000.  They are also spending thousands on all the trimmings, fancy activities, sleep away camp, expensive sports or horse riding lessons etc...   It is one thing to say no to your own spending habits, it is another to say no to your kids when all of their friends are going on a class trip, or are in a travel sports league etc....  I'm not sure how to stop the arms race on kid related spending, because the drive to have your kids succeed no matter what the cost is really hard to overcome.

This is very common where I live as well. Mark of middle-class is: neighborhood (school district) and what activities kids participate in. That was how my mother was when we were growing up. When our household began making more, my mother made sure we got the swimming, ballet, horseback riding lessons and art classes, because those were the things that were most important to her. Can't complain because I enjoyed all those things at the time, and at the time they could afford it.  But it's all about whether you CAN afford it. We've already talked to our oldest that we will help with college but we cannot afford to pay for it all, that if she wants a car she can save up for it, etc.