"How To Tell if You're Middle Class ... Are you close?" The link took me to the following U.S. News article by Rick Newman entitled, How to Gage Your Middle-Class Status
( http://finance.yahoo.com/banking-budgetingk/article/109155/how-to-gauge-your-middle-class-status?mod=bb-budgeting ).
I've known for quite some time that although our family earns what is considered a middle-class income, we live a more modest lifestyle than most middle-class Americans. Why would we live a more modest lifestyle than many others within our socio-economic class? I think the two primary factors that contribute to our lifestyle are, 1. we lived at or below the poverty line for decades and 2. we are now trying to play a financial "catch-up" game with regards to retirement quickly approaching within the next 10-15 years while continuing to raise our two youngest children.
What are we currently doing differently?
Housing - we live in a much smaller and less expensive home than the "average". Not only did our home cost considerably less, but it's smaller size results in lower utility and maintenance costs.
Credit - we only use credit as a tool to maintain an active credit score. We never purchase anything on credit unless we already have the cash to pay for it. If we don't have the money, we simply make do or go without
College Savings - Yes, we are VERY bad parents. We don't have a college savings plan for our children. (The first 20 years of parenting we lived at or below poverty and it simply took every dime we earned to support our family - there wasn't any extra for college savings plans.) Although we've never implemented a college savings plan, our children still have access to college. AB enlisted in the U.S. Air Force and earned the Montgomery G.I. Bill. He has plenty of money to pay for his college education without going into debt. AB appreciates and cherishes the education he's receiving because it is something HE has earned. JP is currently serving in the U.S. Navy and contributing to his Montgomery G.I. Bill. Although JP enlisted in the Navy to gain job training and work experience, he recognizes that he may have a desire to attend college in the future and thus, is contributing to that savings plan. What about OG and EJ's future education? Like AB and JP, we are leaving that in God's hand. God has made a way for AB and, if he desires it in the future, JP to attend college. With the many scholarships, military, grants, etc. available, we are confident that God will also make a way for OG and EJ if it is within His will for them to attend college.
Autos - Mr. B and I share one vehicle. Like our previous autos, we bought it used. Although we did purchase this last one on credit (keeping that credit score active), we purchased one that was within our cash budget and since we had a no penalty interest rate (the only kind of interest rate we'd ever accept), we paid it off 14 months early.
Retirement - We contribute more than the "average" in this area. Until a few years ago, retirement fund(s) didn't exist for our family. Like college savings plans, the money simply wasn't there. We do realize that no matter how much we contribute now, we will never be able to "catch up" all the years that we missed out on in saving for retirement. But still, we don't want to squander the time we do have left to contribute to this possible future need so, we do all we can right now.
Discretionary Spending - We certainly fall well below the "average" in this area. We do not take annual family vacations, we do not eat out on a regular basis, we do not purchase new clothes on an annual basis, we do not regularly spend money on recreation, and I maintain a frugal grocery budget. Again, living at or below poverty for the majority of one's life, will accomplish one of two things. It will drive a person to "spend like a $20 h_ _ ker" every time they have a little extra OR it will drive a person to learn how to save and stretch every dime earned. We fall into the saving and stretching category.
Now, do we suffer a lifestyle of deprivation because we choose to live more conservatively? Absolutely not. We instead, examine our needs and wants and try our best to invest into them wisely. This has led to a content family that is not caught up in the materialism of "average" middle-class America.
If you'd like to learn more about living a debt free lifestyle or you just want to escape the trap of materialism, click the Crown Financial Ministries or Dave Ramsey's Financial Peace links in my sidebar.