10 things that are no longer affordable for the middle class in the US

Middle-class people in the United States have lost purchasing power due to falling wages, rising prices and legislative changes. Representatives of the middle class in America can be considered people earning about $54 thousand a year, this is the average annual income of American families. Economists note that the middle class is individuals or families who spend no more than two-thirds of their income on housing (rent, utilities) and groceries.

Edition Cheat sheet compiled a list of 10 items that the middle class in the United States no longer can afford.

1. Vacation

Vacations are an additional expense that most middle-class people cannot afford without sacrificing something else. The study found that 54% of people gave up buying big-ticket items such as televisions or electronics to go on vacation. Others have cut back or given up going to the movies in favor of going on vacation (47%); some gave up going to restaurants (43%) or buying new clothes to save for vacation (43%).

Modern working conditions and competition nowadays are so tough that many workers who get paid vacation often refuse it. In 2014, the Americans did not take advantage of a total of 429 million paid vacation days. 40% of American workers refer to a heavy workload, as the main reason for not going on vacation, 22% do not want to leave the workplace, so that bosses and colleagues would not see that they can be replaced.

2. New car

Of the 25 largest cities in the country, Washington, DC, is the only place where families can afford to buy a new car.

Therefore, many Americans resort to loans, trying to stretch the payments for the longest possible time in order to reduce monthly installments.

The average loan period for the purchase of a new car is 68 months. Even loans for the purchase of used cars take on average 66 months.

Over 31% of all vehicle purchases are leasing. The average monthly loan payment for new and used cars in 2016 was $503 and $376, respectively.

3. Student loan

Credits for studying in the US are fairly easy to get, but not so easy to repay, and it becomes too expensive for people who receive an average salary.

Over the past decade, the total tuition debt of Americans has grown by 84% to more than $ 1,2 trillion. About 40, millions of US residents have at least one open student loan, with an average debt of $ 30 thousand per borrower. More than 11% of these debts are overdue by at least 90 days.

4. Savings for a rainy day

Nearly half of Americans save almost nothing for the future. 18% do not have any savings at all, 28% save no more than 5% of their income. In general, only 1 from 4 Americans save more than 10% of their income, including only 1 from 7 puts 15% of their income into a savings account.

Only 35% of families with an annual income of $ 50-75 thousand save more than 10% of their income.

Only 38% of Americans have enough money in current accounts to pay for small “surprises”, such as car repairs for $ 500 or emergency medical care in the amount of $ 1000. If a financial emergency arises, 22% plan to pay these costs by cutting spending elsewhere, 16% intend to borrow money from family and friends, and 12% rely on credit cards.

5. Retirement savings

For all working-age Americans, the average retirement account balance is just $2500. Americans nearing retirement age have an average balance of $14—not even enough to cover a year of expenses for an older person, according to statistics.

6. Medical service

Medical care is a basic human need and it seems that the middle class should have access to it. However, 66% of Americans admitted that they had to choose at least once between paying for groceries and paying for medical care, and 31% said that they had to make a similar choice every month.

7. Dentist services

Residents of the United States spend about $ 64 billion annually on dentist services, a total of 4% of this amount is covered by government programs. About 108 million people in the United States do not have dental insurance, and even those who own it can sometimes have difficulty paying for services rendered to them.

In many cases, middle-income individuals postpone or even abandon certain dental procedures in order to save money. Nearly one in four Americans between 20 and 64 has problems with their teeth.

8. Skip payroll

Nearly a third of Americans earning $ 75 thousand a year live from paycheck to paycheck. About 38 millions of Americans eat everything they earn.

9. Baby care

Children are expensive. The US Department of Agriculture estimates that raising a child to age 18 will cost an average of a quarter of a million dollars. In 41 states, the cost of sending a 4-year-old child to full-day preschool exceeds 10% of median family income. In 17 states, it costs more to educate a child than to rent a home.

10. A walk to the movies

Many people do not go to the movies as often as before, because of the price. The average movie ticket price is about $ 9, which is $ 36 for a family of 4 people. But in some cinemas, prices are higher, so a family can spend up to $ 60. This is the cost of a semi-annual subscription to Netflix, where you can watch a lot of movies without leaving home.

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