in our free newsletter.

Thousands benefit from our email every week.

  • Discounts and special offers
  • Subscriber-only articles and interviews
  • Breaking news and trending topics

Already a subscriber?

By signing up, you accept Moneywise's Terms of Use, Subscription Agreement, and Privacy Policy.

Not interested ?

Upper

Based on Pew’s analysis, a household of three needs an income of $156,600 to meet the definition of upper class, which amounts to more than double the national median.

In analyzing the trends, Pew points out that the wealthiest households are the only ones to have seen gains in wealth after the start of the Great Recession. Between 2007 and 2016, the median net worth of the top 20% increased 13% to $1.2 million.

Meanwhile, the lowest earners saw their wealth decrease by at least 20% over that period of time.

The result is that the wealth gap between America’s richest and poorest families has grown into a chasm — more than doubling between 1989 and 2016.

How to get a free $40 to invest in your future

An app called Acorns automatically rounds up purchases made on your credit or debit card to the nearest dollar and places the excess "change" into a smart investment portfolio. Acorns offers a $20 welcome bonus, immediately from your first investment.

Get $20

Middle

Many Americans associate themselves with the middle class. In fact, a Gallup survey from 2022 shows that just over half of respondents identified as either middle or upper middle class.

Based on Pew’s calculator, middle class earners are actually those whos income falls between $52,200 and $156,600, or two-thirds to double the national median when adjusted for local cost of living and household size. In 2022, the median income was $74,580, according to Census Bureau data.

However, while household incomes have been trending upward since 1970, Pew’s research reveals that most of the increases were seen before 2000. In just three decades, the median income rose by 41% to $70,800.

If after 2000 household income had continued to grow at the same rate, the current median would be about $87,000 — significantly more than it is now.

Read more: How can I stop the pain and make money in this nightmarish market? Here's 1 simple way you can protect your nest egg

Lower

Based on Pew’s analysis, a three-person household would be considered low-income if they’re bringing in less than $52,200 a year. This group makes up a significant chunk of the U.S. population, with about 38% of households making less than $50,000 in 2021.

However, keep in mind that geography matters here: In Kansas City, Mo., for instance, that national figure represents a middle-class income but would be considered fairly low in New York City.

But what’s important to highlight when discussing lower-income households is the opportunities for advancement. While middle-class households rely on home equity to build their net worth and upper-class families rely on financial assets and investments to build their wealth, Pew found lower-income earners have fewer options to get ahead.

In fact, research indicates that the wider the wealth gap, the harder it is for lower-income Americans to move up the class ladder.

Stop overpaying for home insurance

Home insurance is an essential expense – one that can often be pricey. You can lower your monthly recurring expenses by finding a more economical alternative for home insurance.

SmartFinancial can help you do just that. SmartFinancial’s online marketplace of vetted home insurance providers allows you to quickly shop around for rates from the country’s top insurance companies, and ensure you’re paying the lowest price possible for your home insurance.

Explore better rates

It’s not just about the numbers

It’s important to remember that economic status as a holistic snapshot that considers far more than simple income.

Researchers have determined that education, location, social connections and other factors can inform a person’s class identification.

On top of that, less-tangible measures of holistic wealth — mental and physical well-being, access to cultural assets, a healthy social network — can all factor in as heavily as income and lead someone with a technically lower-class income to feel as fulfilled as any upper-income earner.

Consider, too, that some high-income earners could technically qualify as an upper-class household even as debt and other financial obligations leave them, practically, in a much different place.

So do the numbers matter? Maybe. But they can always change.

What might matter more is snatching up the opportunities available to your family to continue to keep your household moving up those rungs.

Protect your position

When it comes to building wealth (and a secure financial future), you never want to lose any ground you've gained.

One solution to help you sleep better: Find a financial adviser who can help navigate your finances and make sure your assets are safeguarded.

Researching and calling multiple financial planners can be a time-consuming hassle, but there are ways you can easily browse vetted advisers that fit your needs. Booking a consultation is free and only takes a few minutes.

If you're unsure how to safeguard your hard-earned savings, it’s better to find answers sooner than later, while time is still on your side.

What to read next

Sponsored

Follow These Steps if you Want to Retire Early

Secure your financial future with a tailored plan to maximize investments, navigate taxes, and retire comfortably.

Zoe Financial is an online platform that can match you with a network of vetted fiduciary advisors who are evaluated based on their credentials, education, experience, and pricing. The best part? - there is no fee to find an advisor.

About the Author

Chris Clark

Chris Clark

Freelance Contributor

Chris Clark is freelance contributor with MoneyWise, based in Kansas City, Mo. He has written for numerous publications and spent 18 years as a reporter and editor with The Associated Press.

What to Read Next

Disclaimer

The content provided on Moneywise is information to help users become financially literate. It is neither tax nor legal advice, is not intended to be relied upon as a forecast, research or investment advice, and is not a recommendation, offer or solicitation to buy or sell any securities or to adopt any investment strategy. Tax, investment and all other decisions should be made, as appropriate, only with guidance from a qualified professional. We make no representation or warranty of any kind, either express or implied, with respect to the data provided, the timeliness thereof, the results to be obtained by the use thereof or any other matter.