'The Middle Class Is Dead': Social Media Users Claim $174K Per Year Is Not Doing Well — It's Just The Bare Minimum Needed To Survive

An Instagram reel by a man named Jim Garfield has racked up over 450,000 likes and offers an eye-opening look at how much the definition of the middle class has changed from 1983 to 2024.

In the video, Garfield compares salaries, saying, “Making $30,000 a year in 1983 is equivalent to making $164,000 a year in 2023-2024. The middle class isn’t dying. The middle class is dead.”

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He draws a comparison to the 1950s when the average household income was around $3,000 and a typical house cost about $5,000. Back then, buying a house was about 2½ times your annual salary, making it possible to own a home and a car on an average salary. Fast forward to today, and the numbers tell a different story. With household incomes averaging $74,000 and house prices soaring to around $450,000, the financial stretch for homeownership is far greater.

So, what does being middle class mean in America today? According to Garfield, “The bare minimum of middle class in America right now in 2024 would be about $174,000 a year, and that’s not doing well; that’s just meeting the bare minimum.”

Garfield’s calculations regarding inflation have been disputed. According to inflation calculators, $30,000 in 1983 translates to roughly $112,983 in 2024. Garfield doesn’t explain his math, but his example suggests a cumulative inflation rate of 276.6%. This discrepancy sparked an online debate, with billionaire Mark Cuban even chiming in to highlight the difference. Cuban faced backlash from users who felt his calculations ignored purchasing power and focused solely on inflation.

The comments section reflects the struggle many Americans face. One user wrote, “My husband makes $250,000 a year and we still struggle.” Another added, “My grandparents sold a two-bedroom home for $400K, the same house they traded for a chicken in 1932!”

Trending: Can you guess how many Americans successfully retire with $1,000,000 saved? The percentage may shock you.

While many agreed with Garfield’s assessment, some found it extreme. One commenter wrote, “Entitlement culture needs to end. 74K is enough, people just feel entitled and want the $100K car and $500K house.”

As an article by Visual Capitalist points out, the gap between median house prices and incomes has widened significantly over time. As of 2023, affording a median-priced home in America requires a household income of at least $100,000 — significantly higher than the current median household income. This gap is even wider in certain cities, where the required income to afford a home can be three to four times higher than the median, putting the dream of homeownership out of reach for many.

Such a disparity has a ripple effect on the broader economy. Families burdened by high housing costs have less disposable income to spend in other areas, impacting consumer spending and overall economic activity. Additionally, limited housing affordability can hinder labor mobility because workers may be tied to locations with jobs that pay enough to afford their current housing situation, even if better opportunities exist elsewhere.

While some argue for adjustments in spending habits, the reality is that many families are already struggling to make ends meet. What can be done?

For many, navigating this complex economic landscape requires a comprehensive approach. Consulting with a financial adviser can be a valuable first step.

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This article 'The Middle Class Is Dead': Social Media Users Claim $174K Per Year Is Not Doing Well — It's Just The Bare Minimum Needed To Survive originally appeared on Benzinga.com

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