Middle vs upper class

[disneysteve]

It's frankly bizzare. . .evidence to me that Baby Boomer Americans have done wayyyy too many drugs.

Although oddly enough, the conservative Republicans seem to believe this more than the liberal Democrats and if I had to guess who had spent more time enjoying the 60s, I would have chosen the latter.

[wincrasher]

LOL. They all inhaled. It's just who lied about it, and who didn't!

[maat55]

LOL. They all inhaled. It's just who lied about it, and who didn't!

I definately, did not inhale in the 60's, but I might have in the 70's.

[disneysteve]

I definately, did not inhale in the 60's, but I might have in the 70's.

I'm not that old. It was the 80s for me.

[maat55]

I'm not that old. It was the 80s for me.

It was actually late 70's early 80's for me, I graduated high school in 81. I was a dad by 83 and quit.

[jpg7n16]

I definately, did not inhale in the 60's, but I might have in the 70's.

See this is why you shouldn't do drugs, the memory starts to go!!

[disneysteve]

I'm not that old. It was the 80s for me.

Oh well. I thought about this and realized it was, in fact, the 70s (and the 80s).

[wincrasher]

Actually, something else goes first.....just can't remember what it is.

[jIM_Ohio]

See this is why you shouldn't do drugs, the memory starts to go!!

If it pushes out the bad memories, do more drugs (not less).

My brain is among the most efficient things in the world. I drink. The alcohol kills the brain cells. If you go with the theory only the strong survive, then my weakest brain cells are killed first. This means the brain cells I have are the strongest ones I have ever known, making my brain more efficient.

If Cliff Claven said it, it must be true.

[EEinNJ]

Generally if you make above 166k AGI (or somewhere in there) I would consider you upper class- between 165k and 200k the IRS starts phasing out most deductions, so that is where I also draw the line as to "middle" or "upper".

Lower class is where the EIC sits (it is designed to help low income WORKERS) which is about 40k with 3 kids or about 20k single.

jIM nailed this. In all the political posturing and sound-bite reporting they ignore the reality of the tax code as it stands. That is, they already go after people making far less than 250K, not by raising the tax on the bracket, but by phasing out deductions.

Tax-wise, the worst place to be is a high salary W-2 employee. If you're a business owner, you can pay yourself less, itemize and expense, defer compensation, have a SEP IRA, etc.

[Scanner]

Middle class falls short on retirement funds - Yahoo! Finance

Here is a link defining Middle Class as 40K to 100K in household income.

It's weird though. . .I thought that Americans were saving more (savings rate: 7% now) but they are saying that the average retirement fund has 29K in it for Americans 50-59.

Are perhaps Americans saving money in just vanilla taxed savings accounts? My sister is kind of like that - keeps like 50-100K in "Savings" but has like 30K in retirement. I tend to be the opposite if anything - I am more heavily weighted in my retirement and need to up my EF.

[disneysteve]

It's weird though. . .I thought that Americans were saving more (savings rate: 7% now) but they are saying that the average retirement fund has 29K in it for Americans 50-59.

Are perhaps Americans saving money in just vanilla taxed savings accounts?

The whole way the calculate those figures is really screwy, pretty much to the point of being worthless. For example, retirement savings don't count in the "national savings rate" so if you are putting 10% of your income in your 401k, that would show up as a 0% savings rate. Home equity also doesn't count so if you are sending an extra $500/month to your mortgage principal, that doesn't count as savings either.

As for the average retirement account balance, I'm not sure how much that means, either. I think it is more important, although still suspect, to see that broken down by age group. Obviously, someone in the 20-30 age group will have less in their retirement account than someone in the 50-60 age group.

[jIM_Ohio]

Middle class falls short on retirement funds - Yahoo! Finance

Here is a link defining Middle Class as 40K to 100K in household income.

It's weird though. . .I thought that Americans were saving more (savings rate: 7% now) but they are saying that the average retirement fund has 29K in it for Americans 50-59.

Are perhaps Americans saving money in just vanilla taxed savings accounts? My sister is kind of like that - keeps like 50-100K in "Savings" but has like 30K in retirement. I tend to be the opposite if anything - I am more heavily weighted in my retirement and need to up my EF.

The vast majority of respondents admitted they need help figuring out how much money they need to live on in retirement and picking investments for their 401(k)s. But in a negative twist for financial advisers, more than two-thirds said they were not willing to pay for this advice.

This puts more responsibility on employers to offer advice and planning tools through their workplace 401(k) plans, said Nordquist.

"If people aren't willing to pay for advice they are going to get a more vanilla approach to planning," she said. "But a simple plan is better than no plan."

One person's stupidity is another person's job security... the plans to give someone the info cost between $2000-$5000.

[dfeucht]

As for the average retirement account balance, I'm not sure how much that means, either. I think it is more important, although still suspect, to see that broken down by age group. Obviously, someone in the 20-30 age group will have less in their retirement account than someone in the 50-60 age group.

The word "average" is ridiculously misleading. Tehre are many ways to measure "average". For instance - when referencing "average" medical costs (defined as the mean) only about 10-20% of the population actually have medical costs that are higher than the average, while a clear majority have costs less than that (and most SIGNIFICANTLY lower than that).

The "average" could also be defined as the median which means 50% have more and 50% have less than that number.

Depending on the metric and the story you are trying to tell you can use either number to help fit your story and call it an average.

So reading an average of $29K in retirement accounts doesn't help much without more context and analysis of what that really means.

Statistics are very dangerous - you can use them to support anything if you define it the way you want and use tricky wording.

[happygirl]

jIM nailed this. In all the political posturing and sound-bite reporting they ignore the reality of the tax code as it stands. That is, they already go after people making far less than 250K, not by raising the tax on the bracket, but by phasing out deductions.

Tax-wise, the worst place to be is a high salary W-2 employee. If you're a business owner, you can pay yourself less, itemize and expense, defer compensation, have a SEP IRA, etc.

This has been my understanding. So, what is the significance of the tax cuts for those making above 250k but below a million? Let's say hypothetically that a couple makes 300k per year and does not own a business, but is just a regular employee. What difference would the temporary tax cuts make? Is there a simple summary out there? Thanks everyone!