When you cross over to higher income levels, it’s easy to assume you’re rich. However, there is a fine line between being middle-class and rich. If you’re unsure of where you stand in the social hierarchy, then these 20 things suggest you’re middle-class and not rich.
Owning a modest home
Many millionaires live in modest homes, and while many consider millionaires to be rich, most represent the new middle class and have slowly grown their wealth. A national study of millionaires conducted by Ramsey Solutions found that the majority of millionaires don’t have high-income jobs.
Budgeting
Budgeting is an important financial strategy for anyone building wealth. It tells you where your money should go, but once you’re rich, you have such an endless supply that you don’t need to sort it into categories. Budgeting becomes irrelevant at this point, so if you’re still creating a budget each month, you’re probably middle-class.
Clothing
Your clothing reflects your social status much more than you think. It’s commonly thought that rich people wear heavily branded clothing, but this is not true. Quiet luxury is a flex for the ultra-rich, so you’re more likely to be middle-class if your fancy clothing is obvious.
Dining out occasionally
Finances still need to be monitored when you’re middle-class, meaning that dining out is more of an occasion than a frequent event. During a cost of living crisis, it’s more difficult to eat out regularly, but the wealthy still eat out a lot as they don’t need to worry about the cost.
Limited disposable income
A huge benefit of higher salaries is having more disposable income to use for leisure. However, when you’re middle-class, your fun money still has a limit. The truly rich can just spend whatever they want without worrying about money running out. Their disposable income seems to never end.
Responsible debt management
Rich people have incredible amounts of debt, and they use this as a tool to build more wealth. They usually have high credit limits and no need to worry about high interest. Alternatively, middle-class people manage debt a little more responsibly and prioritize paying off balances.
Driving a practical car
Many rich people drive practical cars, but most with unlimited funds will go for something special. For those who need to focus on the cost of their car, this highlights being middle-class, as you still have an intricate financial plan. It showcases great financial responsibility that the rich don’t need to worry about.
Working a traditional job
Your social status is typically more of a reflection of your career than the balance in your bank account. Building your wealth through a traditional 9 to 5 job is a sure sign you’re middle-class. Those classified as rich are more commonly entrepreneurs or have multiple income streams.
Saving for retirement
The majority of us have to work hard for our retirement, but the rich don’t. When you are really rich, you likely have passive income streams that you don’t have to worry about. They will set you up for retirement, and you don’t need to worry about saving up.
Budget vacations
Rather than taking extravagant trips or going on exotic vacations, middle-class families typically head to budget-friendly destinations instead. With savings goals still in mind, the middle class will opt not to splurge when they can enjoy a vacation with a lower price tag just as much.
Shopping at discount retailers
The middle class will continue to shop around for the best price, whereas the rich don’t have to. Rich people prioritize convenience over expense and will purchase something the first place they see it. Middle-class individuals, on the other hand, will choose discount retailers to save money.
Using credit cards responsibly
Both the rich and the middle class will take advantage of credit cards, but the way they are utilized is completely different. Middle-class people who are money-conscious will spend on their credit cards and pay them off every month. Rich people don’t avoid the excessive debt associated with credit cards as they don’t need to worry about high-interest charges.
Paying off student loans
Rich people traditionally wipe out their student loans in a few payments, if they even needed to take one out at all. Students from rich backgrounds can pay their college tuition in cash. If you’re middle-class, you’re probably still paying off your student loans which is impacting your financial flexibility.
Saving for children’s education
Part of the financial plan for many middle-class people is to save for their children’s education. If you’re fortunate enough to be putting away money for college tuition, you’re in a great financial position. However, the rich will be able to fork over the funds for college education without the need to save up for it.
Health insurance
When you’re super rich, your healthcare will be undertaken by the most prestigious medical facilities that most health insurance policies simply don’t cover. Rich people typically pay cash for their medical expenses, so if you’re still making claims on your health insurance, you’re probably middle-class.
Planning for emergencies
Rich people have no need to plan for emergencies as any unexpected expense can be easily covered with no fuss. Those with a more modest income have a greater need to squirrel away some funds for a rainy day so that they’re not caught short when an emergency strikes.
Saving for major purchases
If you’re rich, as soon as you want something, you usually have the funds to buy it, so if you need to save up for a major purchase, it’s a sign that you’re middle-class. With a more modest income and greater financial responsibility, saving up is the only way to achieve your goals.
Accessing public services
You need security and privacy more when you’re incredibly rich. You’re more likely to use private services than public services such as schooling and even libraries. Rich families have no need to rely on public services as they can afford the extra expense of additional safety and greater luxury.
Using public transport
You probably won’t catch someone who is genuinely rich using public transport. Instead, they hire drivers to be private chauffeurs, getting them from A to B. If you still rely on public transport, even if it is Uber drivers, you’re probably not as rich as you think you are.
Utilizing coupons
Coupons are a great way to save money and many middle-class families use them to their advantage for great deals and more disposable income. Rich people don’t waste time on coupons as they don’t value a great deal in the same way. They will just pay the first price they see and have no need for discounts.
Up Next: 17 Things Most People Forget After Someone Dies
When a person dies, it’s easy for their partner or family members to overlook things while they process shock and grief. Despite the pain of losing a loved family member, it’s important to remember to organize these 17 things to prevent problems later on.
17 Things Most People Forget After Someone Dies
17 Phrases Confident People Use to Stand Up For Themselves
Confidence is a healthy and attractive trait that helps us stand firm in our values and set healthy boundaries. We can always become more confident, and learning the right ways to stand up for yourself is a great way to start. Here are 17 phrases you can use to do so.
17 Phrases Confident People Use to Stand Up For Themselves
20 Signs Someone Is Only Pretending to Care
Whether it’s to avoid hurting your feelings or if it’s part of a more elaborate plan to deceive you for benefits, people pretend for many reasons. The main theme with them, though, is that their actions never match the sugar-coated words that come out of their mouths. So that you don’t fall for someone like this, we’ve compiled 20 signs for you to look out for.