Six Reasons Americans Fall Out Of The Middle Class: 24/7 Wall St.

From 24/7 Wall St.: Seems as though the American Dream is just that — a dream. If you were born into a middle class family, there is a high chance that you’ll end up falling down the economic ladder into a lower class, according to a new report by the Pew Charitable Trusts. And while your parents profession or your race are a good predictor of where you’ll end up if you didn’t start in the middle class, they’re not very helpful if you were born into it. 24/7 Wall St. has reviewed a new report from Pew Charitable Trusts to identify the six traits that can contribute to a person’s likelihood of falling out of that economic group.

It is widely assumed that children will end up financially better than their parents. But “Downward Mobility from the Middle Class,” a study published by the Pew Charitable Trusts, reports that a staggering third of Americans raised in the middle class fall out of it as adults. The middle class is defined by Pew as those between the 30th and 70th percentiles of the income distribution, making below $110,600 and above $53,900.

The greatest predictor of a person’s class as an adult is the class of the parents, regardless of outside attributes such as race and education. Still, a large number of people born into the middle class eventually fall out of it.

There are a number of characteristics, including level of education, marital status, and other individual choices, that may make certain middle class people more likely to decline in relative economic standing.

24/7 Wall St. has reviewed the factors that contribute to a person’s likelihood of falling out of the middle class, according to the Pew Charitable Trusts. We have included the likelihood (in percentage points) of men and women who exhibit these factors to drop out of the middle class.

These are the six reasons Americans fall out of the middle class, according to 24/7 Wall St.

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Comments

[realitytrumpsbull]

05:42 PM on 09/19/2011

I'd say also in here is the basic question of 'how bad do you want to be 'middle class' '? How important is money to you as an individual? Did people 'fall out', or did they jump(were they maybe PUSHED)? What happens if you've been a good corporate tool for a number of years, and you hit burnout, or the company moves to Zanzibar and forgets to invite you? Stuff happens. Don't measure yourself, or let yourself be measured/judged, by economic status. Money comes, money goes.

[realitytrumpsbull]

05:13 PM on 09/19/2011

Part of the reason that people are 'falling out' of the middle class, also, is because there's been some heavy-duty social engineering at work. Jobsite politics, taken to the professional level, reviewing the 'total candidate', even after you've been hired and working there for a while. HR 'magic'.

[realitytrumpsbull]

05:07 PM on 09/19/2011

Aren't the 'middle class' just like, the 'head slaves', that kind of thing?

[toddisit]

12:13 PM on 09/16/2011

Those are more personal reasons, what about all our jobs constantly going overseas? It is hard to believe that personal reasons are identified as the major causes of the erosion of the middle class. If anything, those are peripheral reasons. Of course, those are factors, but not main factors.

[kraki]

10:28 AM on 09/12/2011

Non married people are that way for a reason. Usually contain 1 or more defects. Not always the case but more often than not.

[realitytrumpsbull]

05:40 PM on 09/19/2011

What, like not being STUPID? That's not a defect. Not following your social programming=ability to think and act independently, not good corporate drone material, there.  Don't let the idiot box do your thinking for you...

[Really I B Waiting]

10:27 AM on 09/12/2011

So once again, we didn't steal your money; you fell out out.

Thank you,

Banker$ of America

[ToCensorIsAnEpicFail]

10:25 AM on 09/12/2011

What I learned from this article is that if someone falls out of the "middle class" than it is because they are personally, socially responsible.

If everyone would be socially responsible than everyone could be middle class.

The destroyed value of the US dollar. The corrupt tax code. The corrupt judicial system. Preferential treatment given to businesses. Bailouts for failed companies. A corrupt patent system. No manufacturing within our economy. A huge federal deficit. - These things are the excuses that people give when they fall out of the middle class, because they were not socially responsible.

America's middle class is failing because of poor social values, that's what the article says. It's a bunch of lies.

America's middle class lacks equity and opportunity due to the failings of government. IMHO.

[Runey]

06:50 AM on 09/12/2011

This looks like a mascara cover-job for the real reasons people fall from the middle class.
Reasons 1-6 should read:
The Global Elitist Doctrine to undermine the working class into a starved slave workforce.

[RMForbes]

11:33 PM on 09/11/2011

During the last decade more than $55 trillion moved out of the sectors of our domestic economy that supported our vast middle class and was moved into coffers of the banksters on Wall Street because the Bush Tax Cuts reduced the capital gains rates from 20% to 15% and included special tax incentives and tax exclusions which reduced the effective tax rates for the very wealthiest to half the effective tax rate average Americans pay. With tax rates on profits earned gambling at the Wall Street casino at half of the taxes on profits earned producing products in our domestic economy it became more profitable for businesses and the biggest players on Wall Street to move into the capital and commodity markets than investing in domestic business assets. This has sucked trillions out of the middle class and handed it to the already wealth, destroying the world economy in the process.

[Uncle Bill]

10:28 PM on 09/11/2011

This list is shocking for what it leaves out- the number of people who lose their middle class status because of their own serious illness or that of a family member which often results in job loss as well.  Today's average middle class family is much less economically resilient than previous generations because we have gone from one wage earner being able to support a family, with a stay at home parent who can take up the slack in case of temporary unemployment, illness etc, and who provided child care and a home.  Once Mom entered the workplace, costs increased along with with incomes and but the margin between making it and disaster got much thinner.  Women's average incomes have risen sharply, but men's have been stagnant or retreated in many cases.  Middle class families bear much more of an economic burden to ready children for their entry into the middle class workforce, pay higher taxes overall and much higher health care costs.
Elizabeth Warren's lecture on the middle class from several years ago is prophetic, on You Tube and worth every second of your time: http://www.youtube.com/watch?v=akVL7QY0S8A

[Linda from Deerfield]

10:05 AM on 09/12/2011

I, too, have looked upon the reliance on dual incomes as making families tremendously more fragile. For instance, my husband and I were able to buy a decent home that either of us could support if one of us lost a job but I don't see that many people can do that these days, even with the lower post-boom home prices. It is perhaps the ultimate reason that most of these identified contributors can result in a downward spiral.

[chelsealoc]

05:52 PM on 09/27/2011

I have to say I agree with the sentiment that a lack of affordable and accessible health care and child care have aided in the decline of the middle class. Women have gone to work, and what for? Simply to pay for ridiculously bloated medical costs? As a divorced, working mother-of-two, my working full time barely wins the case for whether to work or not. By the time I pay for child care and health care, I would almost be better off staying home. Not to mention our lack of affordable education. This article seems sadly biased and completely ignores the sad state of our country.

[fortressfountain]

05:14 PM on 09/11/2011

No matter what, I will never buy again unless it is second hand. I will never take out credit again or any kind of a term loan.

[realitytrumpsbull]

05:08 PM on 09/19/2011

Good for you!

[Ron Dernick]

05:12 PM on 09/11/2011

The new deciding factor..not being pat of the Plutocracy since they have declared war via the Koch brothers..on unions ,,what's left of the middle class..we lost one-3rd--and the desire by the GOP to have all people work for min wages and pay for their own benefits..FUBAR America..time to march and take back your power and freedom..

[kraki]

10:32 AM on 09/12/2011

ROFL, don't blame others for you shortcomings. It makes you MUCH less desirable to hire. The stench of failure does not add value.

[realitytrumpsbull]

05:45 PM on 09/19/2011

Koch...that name makes me think of a couple different countries...and how do you know for sure they're not in cahoots with the unions, trying to drum up some public interest in labor organizations, fake attacks, that kind of garbage?   I tell you what, YOU go march, and be a tool for the puppeteers, I'm going to go learn how to run my own private business. Unions? WHAT a joke. They're mainly concerned with their own.

[fortressfountain]

04:55 PM on 09/11/2011

This is quite a turn-around-why only a few years ago-wall street told me I could qualify for a $500,000 home and a $10,000 credit line even though I did not have a job at the time I applied for a mortgage?
Rainy day friends if you ask me. Happy when everyone is paying for their god awful creations but when the money stops rolling in-sounds of sour grapes to me.

[realitytrumpsbull]

05:45 PM on 09/19/2011

Maybe they have drug testing on Wall St., now, and it's not just testing to see if it's un-cut.

[formontoya]

03:20 PM on 09/11/2011

What a bunch of crap...this article did not mention anything about people who used crack...totally biased!

[realitytrumpsbull]

05:51 PM on 09/19/2011

Didn't they say that Bernie Madoff had a bunch of coke fiends on-staff, or something like that?

[PragmaticFanatic]

02:05 PM on 09/11/2011

A woman who is naturally blonde, blue-eyed, beautiful and average intelligence needs nothing except that. She has been born with a career: making beautiful blonde-haired blue-eyed duplicates of herself for wealthy infertile couples who will pay her $100,000 a baby plus all living expenses while she carries. Why more woman with limited means don't do this I don't know. At the end of a 15-year "career" she could have put away a nest egg of 1.5 million dollars.

[Janetshusb]

05:11 PM on 09/11/2011

Well I must say that is one of the more thought provoking ideas posted on HP................................. Still reeling from the thought of one baby every year for 15 years.

[kraki]

10:37 AM on 09/12/2011

The "under carriage"/Frame etc are going to be shot to hell. You best install a zipper on the belly for quick removal.

Also, why didn't god/mother nature use Styrofoam Peanuts for baby packing? It's a NASTY mess.