You don’t enter the upper middle class without some people noticing. There is a set of signals you send once you’re living slightly better. Purchasing a bigger home or telling your friends about finer dining experiences signals you’ve transitioned to a higher income bracket.
Although you should be wary of lifestyle inflation, living better is okay when you can comfortably afford to do so. After all, money isn’t just meant to pile up somewhere. If you’re curious about how people in the upper-middle class live or aspire to reach this status, keep reading. We’ve compiled a signal list indicating you’ve entered the upper-middle class.
What Is the Upper-Middle Class?
Before diving into our list, it’s important to understand what is upper-middle-class. According to Pew Research, you’ve entered the upper-middle class if your household earns more than $145,500 annually. Depending on where your income is, you may feel discouraged or motivated by this number.
Keep in mind that money doesn’t equal happiness. If you’re in a lower income bracket, look for ways to increase your income. Switch careers, start a side hustle, and figure out what happiness looks like for you and your family.
Additionally, the list you’ll read shortly is a general statement that won’t apply to everyone. However, assuming you’re not accumulating large amounts of debt, they are good tell-tale signs of someone in the upper-middle class.
1. Home Ownership in a Desirable Neighborhood
Owning a home is a huge achievement and one of the most expensive purchases you’ll ever make. If you’ve recently sold your home to move into your dream neighborhood, odds are you’ve entered a new income bracket. Rarely will you only pay for a home at face value. Property taxes, insurance, and maintenance can quickly drive up the monthly cost.
However, if you purchase a more expensive home, we can only hope you’re buying it because you can comfortably afford it. This hints that you’ve entered a new income bracket.
2. Driving a Luxury Vehicle
Vehicles are also one of the most expensive purchases you’ll make. If you used to drive an average car costing $25,000 or less and one day show up with one costing $70,000 or more, you’ve entered a new income bracket. You’d either have most of this money to offer as a down payment or have low amounts of debt to be able to take out a loan for this large amount.
3. Regular International Travel
Flying domestically can easily cost a few hundred bucks for a single person. Now imagine the cost of international travel for a family of three or more. If you’re at the stage in life where you’re constantly planning international trips for you and your family, odds are you’ve entered the upper-middle class. Traveling frequently also means you have the flexibility to do so with your job.
4. Membership at Exclusive Clubs
Paying for a cost-effective gym membership, among other clubs, is the standard for anyone living frugally. However, if you’re upper-middle class, paying for a $60 monthly gym membership or more won’t break the bank. You can still save money, but you can splurge a bit more on your memberships.
5. Ability to Save and Invest Significantly
If you’re earning over $145,000, you can easily save a few hundred dollars per month. This is assuming that you’re keeping other expenses low. You most likely have many financial goals and are consistently on track to reaching them annually.
6. Private Schooling for Children
Education is important. If you’re earning enough money, you might send your children off to private school. On average, private schools can cost over $10,000, or around $1000 monthly. Sending your kids to private school indicates you’ve entered the upper-middle class.
7. Dining Out Frequently at Upscale Restaurants
You’re making more money, so you’re most likely crunched with time. Whether you’re running your own business or a tech company’s senior manager, you will happily pay to eat more often. Unless you enjoy cooking, it will be easier to spend extra money eating out to save time.
8. Ownership of Multiple Properties
With today’s interest rates, purchasing a home is harder than ever. However, real estate is how many build wealth, which may be part of why you’re now in the upper-middle class. Owning multiple real estate properties is a good indicator you’re earning more money. You need good credit and enough money to take out a loan for multiple real estate properties.
9. Having a Personal Financial Advisor
It’s not enough to have a high income. You need to manage it properly. People in the upper-middle class tend to work as financial advisors in some capacity. Even if you invest in index funds, which tend to be passive in maintenance, financial advisors can shed light on other investment strategies to help you reach your financial goals.
10. Regular Professional Home Maintenance
Whether you have a single property or multiple, you may be doing regular home maintenance upgrades. Many forgo roof upgrades not because they’re unaware it needs repair but because they can’t afford it. However, being in the upper-middle class allows you to budget for these expenses more easily.
11. Substantial Retirement Savings
Similar to being able to invest, saving for retirement is something you’re most likely on track with if you’re in the upper-middle class. Because you’re able to save more money, you have more disposable income to invest to take advantage of compound interest. Your future in retirement looks bright because you’ll have enough money to live off and potentially give away to your family.
12. Access to Premium Health Care Options
Health is at the top of most people’s minds. Without proper health, nothing else follows. Insurance isn’t cheap. Even if you’re paying for health insurance with your employer, you’re spending a few hundred dollars a month. However, this won’t stop the upper-middle class from purchasing the best healthcare options for their family.
Expensive isn’t always the best option. However, having the freedom to choose your ideal healthcare option is a sign you’re financially well off.