One expert argues that Americans now need to earn $120,000 a year to live a typical middle-class life and qualify to buy a home.
“I think most people in America define the middle class as someone who works 40 hours a week and earns enough to buy the average American home,” said Freddie Smith, an Orlando real estate agent and TikTok creator. Told. he told FOX News Digital.
This TikToker explores the struggles of Millennials and Gen Z to afford a home and general living expenses in today's economy in a video that explores the common elements of middle-class life. was analyzed in detail.
“Many of us grew up middle class, and as millennials we saw what the middle class looked like in the '80s and '90s. And today, more than anything, it's the housing market that is moving the goalposts.” the official said.
Smith explained that just a few years ago, $60,000 to $70,000 a year was enough to buy a home.
The average home price in 2024 is about $400,000 to $420,000, so you would need a salary of about $120,000 a year to qualify, Smith explained.
The real estate agent highlights how this wage and housing disparity is forcing many people into long-term rentals.
“Rent prices take up 30 to 40 percent of people's income, making it difficult to save for a home. So this endless cycle is keeping people out of the middle class,” he said. explained that this trend has continued rapidly in recent years.
Smith also explained how a $120,000 salary, even without children, becomes a much lower number when faced with the crippling debt that most Americans face today.
“Most people carry around student loan debtThis is an all-time high, with the average payment in this country being $500 a month for a college degree. [There are] “I've had people say in my comment section, 'I wish it was $500, I wish it was $1,200 a month,'” Smith said.
Credit card debt has reached its limit Record high in AmericaSmith acknowledged that reckless spending may have been a factor, but many Americans commented on his post and said they were forced to use their cards to buy groceries because they ran out of money. I learned that I was no longer getting any money.
According to DQYDJ, average income of Americans In 2023, annual income was approximately $69,000, with only 18.8% of Americans making more than $100,000 annually. According to the same source, the top 10% of individual earners started at $135,605 per year.
The middle class is fragmented, Smith argues, largely determined by how much debt people have.
“If you bought a home before 2020 and paid it off or had an interest rate of 3%, you won’t be burdened with housing costs like you would be today as an adult in 2024. ” said the official, explaining how the debt would be incurred. College debt, housing costs, and childcare are particularly burdensome for Millennials and Gen Z as they begin their new lives.
“I've heard that people spend about $1,200 to $1,500 a month on day care, and as much as $3,000 to $4,000. So that's $2,500, $2,000 on day care, and $1,000 on two college loans. If you add in people who rent, that's $100,000 in income alone,” Smith said.
For slightly older people who have had the opportunity to pay off debt and have adult children, $70,000 is still a comfortable middle class wage for them.
“'These Millennials are whining. This Gen Z is going to work harder.'” If you bought a home before and had no other payments, it's really a three-layer cake.residence, university [debt] and day care,” Smith explained, emphasizing that these three factors largely determine the placement of the middle class.
Due to rising housing costs, many young people are choose to stay home Together with the family to save funds.
Smith explains that Florida is becoming more communal, with separate families choosing to live under one roof.
“Many families [with] With 3 to 4 adults [say] Five children live in a big house and all take care of each other. You can tell they have a lot of toys and they are spending money on each other,” Smith elaborated.
TikTokers enumerate how Millennials and older Gen Zers have faced “difficult” responses. But young Gen Zers have plenty of “opportunities” to “beat today's economy” if they plan carefully to avoid debt and make smart financial choices.
“Millennials are a generation that has fallen on hard times, as college has essentially put them out of work for most of them. Debt has piled up, the old American dream has evaporated, and we've been left holding the bag. ” he said.
The author said that through her posts on TikTok, she has learned a great deal about the everyday struggles that real Americans face through the comments section.
“People in America, people in the real world, are sharing all of this with me. And I'm learning at a fast pace from a lot of different people. I can't just Google it or ask 100 college students to share all of this with me. It's not just about having your opinion heard. Thousands of people are sharing what's going on,” Smith said.
The real estate agent talked about how there is a “bigger conversation” happening around the evolving American Dream that will occur in the coming years.
“We're basically redefining the American Dream from top to bottom, like the idea of work and work-life balance,” the author says, and how the idea of owning a home has evolved with past generations. I explained how it gets old.
“I don’t even know if Millennials and Gen Z want to go down the path of buying a house and living there for 40 years and staying at the same job for 40 years. “I don't think it's a serious initiative,” he said.
