Study: 70% of Americans identify as middle class despite decline in household income

By Katherine Michalets - Freeman Staff

June 22, 2017

MILWAUKEE- Despite the number of middle-income households dropping in the United States, a recent study by Northwestern Mutual found that seven in 10, or 70 percent, of American adults ages 18 and older view themselves as middle class.

According to Northwestern Mutual's 2017 Planning & Progress Study, 84 percent of American adults say that one defining element of the middle class is based on income or assets. More than half of those who identified as middle class in the study have household incomes ranging from $50,000 to $125,000 annually.

Data from the Pew Research Center, on the other hand, illustrated that the number of middle-income households in the United States has been dropping for four decades, and made up 50 percent of the U.S. adult population in 2015, down from 61 percent in 1971.

A release from Northwestern Mutual said the reason for the discrepancy between its findings and those of Pew's may be linked to the way Americans perceive what it means to be middle class.

For 70 percent of Americans, lifestyle and perspective are also defining elements of the middle class.

"This research clearly shows that those who consider themselves part of the middle class in America see beyond just income levels and identify with something greater," said Rebekah Barsch, vice president of planning, Northwestern Mutual. "When you dig into the attitudes and behaviors of the middle class, you find it's an optimistic group with a strong sense of financial responsibility."

The 2017 Planning & Progress Study found that people who identify as middle class are:

- More likely to believe in the attainability of the American Dream (55 percent vs. 48 percent of the general population)

- More optimistic about the U.S. economy this year than in 2016 (47 percent vs. 43 percent of the general population)

- More likely to have a clear and accurate view of their financial picture (71 percent vs. 64 percent of the general population)

- More likely to work with an advisor (43 percent vs. 35 percent of the general population)

- More likely to feel very financially secure (58 percent vs. 47 percent of the general population)

"If identifying with the middle class is as much a state of mind as it is a state of finances, there are good signals in these findings that- as a group- these are people who see potential in the future and are taking good steps to plan for it," said Barsch.

Also interesting is that single Americans are less likely to consider themselves middle class- 57 percent of single men and 59 percent of single women say they're middle class versus 85 percent of non-single men and 74 percent of non-single women.

In addition, most mobility into the middle class has been upward with 40 percent responding they were lower middle class or 43 percent saying they were low income five years ago.