How To Tell If You’re Poor, Middle Class, Upper Middle Class or Rich

Wealth isn’t just a balance in your bank account.

No, really. There are many ways to measure wealth, and one person’s definition of wealth is someone else’s definition of being poor.

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But for Gen Z to be successful, they want a higher salary than any previous generation. In fact, a recent survey by Redfield & Wilton Strategies for Newsweek mentions that a $74,000 annual salary isn’t even considered middle class by Gen Z.

We’ll dive into the details of how Gen Z views money; the numbers around what’s considered poor, middle class and upper class, and some other aspects of wealth to help define what’s considered wealthy.

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Average Net Worth for Gen Z

Unsurprisingly, Gen Z has the lowest average net worth of any generation. As they are just getting started on their careers and haven’t had much time to accumulate wealth, this makes perfect sense.

According to the Federal Reserve, individuals under the age of 35 have a median net worth of around $39,000. While this figure includes a few younger millennials, this reflects mostly Gen Z adults.

Compare this to the net worth of other age ranges, and the difference is pretty staggering:

Data source: Federal Reserve Changes in U.S. Family Finances from 2019 to 2022

It’s no surprise Gen Z is on the lower end of the net worth spectrum, but considering the cost of living has increased dramatically over the past few years, this might make Gen Z feel left behind.

Check Out: 7 Key Signs You’ve Reached Financial Freedom

Average Salary for Gen Z

Gen Z not only has a lower net worth, but a lower average salary than most generations. Again, this makes sense given they are at the beginning stages of their careers, but it’s tough when renting an apartment, buying a car or just grocery shopping is much more expensive than even just a few years ago.

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Using the same data from the Federal Reserve, those under the age of 35 have a median salary of around $60,500. Again, there are some millennials mixed in here, but it’s mostly Gen Z salary numbers.

Here’s how Gen Z’s salary compares to other age ranges:

Data source: Federal Reserve Changes in U.S. Family Finances from 2019 to 2022

Gen Z is on par with retirees for income, but don’t have the advantage of a pension (in most cases), retirement accounts or a paid-for home. And according to a recent survey by Newsweek, this salary is not even good enough to be called “middle class.”

Gen Z Doesn’t Think $74K Per Year Is Middle Class

According to The Bureau of Labor Statistics (BLS), the median weekly income for an individual is about $1,145 in the fourth quarter of 2023. Multiplied by 52 weeks in a year, this equates to a median salary of $59,540.

Pew Research defines “middle class” as two-thirds up to double the median annual salary. So by that logic, the middle-class salary range would be $39,892 to $119,080.

But even a salary in the middle of the range isn’t enough for Gen Z. According to a survey conducted for Newsweek, Gen Z didn’t think that a salary of $74,580 was enough to be considered middle class. In fact, 59% of respondents decidedly said that it was not middle class.

Most likely, this is due to the rising cost of everything, including rent and vehicles. Pair that with lower average salaries and net worth than other generations, and it’s no wonder Gen Z feels poor.

But Is Gen Z Really Poor? Here’s How To Tell

In a recent survey by GOBankingRates, Gen Z said that salary is the most important factor in getting a job. Other benefits, such as medical coverage, retirement plans and work-life balance are not as important.

If you’re under the age of 27 and aren’t sure where you land in the financial class of America, here are the numbers to consider:

Salary by Class

According to the Census Bureau data from 2022, here’s how the latest salary numbers break down by class in America:

• Lower class (lowest 20%): $30,000 or less

• Lower-middle class (20% to 40% range): $30,001-$58,020

• Middle class (40% to 60% range): $58,021-$94,000

• Upper-middle class (60% to 80% range): $94,001-$153,000

• Upper class (more than 80%): $153,000 or more

If your salary is over $94,000 per year, this puts you squarely in the upper-middle-class range, and higher than 60% of Americans.

Considering the median Gen Z salary is around $60,000, this would make them the definition of middle class.

Net Worth by Class

According to Federal Reserve data, here’s how the latest net worth numbers break down by class in America:

• Lower class (lowest 20%): $14,000 or less

• Lower-middle class (20% to 40% range): $14,001-$71,000

• Middle class (40% to 60% range): $71,001-$159,300

• Upper-middle class (60% to 80% range): $159,301-$307,200

• Upper class (more than 80%): $307,201 or more

If your net worth is over $307,201, this makes you part of the upper class. But that’s the bottom end of the range, and the median upper-class net worth is $747,000.

Considering Gen Z median net worth is less than $39,000, this would indicate that most are lower middle class. And this lines up with Gen Zers feeling that they need a higher salary to catch up.

Other Markers of Wealth To Consider

In addition to net worth and salary numbers, here are a few other factors that indicate wealth:

Debt freedom. If you are consumer debt-free, this is a massive marker of wealth — especially in today’s world of $1,000 car payments and high credit card balances.

“It’s about managing your debt wisely, like keeping manageable levels such as student loans while having a plan to pay them off, rather than drowning in high-interest credit card debt,” said Ashley Vincent, founder of Home Investors.

High retirement account balances. If you don’t have a lot of cash on hand or own a home — but have been able to invest a decent amount of your salary, this is a great market of wealth.

“Investing in assets and contributing to retirement accounts shows foresight in securing your financial future,” Vincent said.

While most Americans have a significant chunk of their net worth tied up in their personal residence, growing your retirement account can help you enjoy your wealth and become financially independent much sooner.

Low interest rate on home. If you were able to lock in a 3.00% APR or lower on your home, this is a new way to measure wealth. Extremely low payments on your home help you avoid inflation and let you invest more money elsewhere while your house can grow in value over time. This is a marker of wealth that will continue to be relevant in today’s high interest rate environment.

Moderate lifestyle. Contrary to what TikTok, Instagram and other influencers portray, a picture-perfect lavish lifestyle is not a marker of wealth.

“Lifestyle choices matter too, like living within your means and prioritizing needs over wants,” Vincent said.

Having a well-maintained used car, buying quality items and only buying luxury when it lasts decades are a marker of a “quiet wealth” lifestyle.

Side hustle rich. Having a side hustle can help you get ahead quicker and give you more financial security.

“Having multiple streams of income, such as side hustles, adds an extra layer of financial stability, ensuring you’re not overly reliant on one source,” Vincent said.

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This article originally appeared on GOBankingRates.com: Net Worth for Gen Z: How To Tell If You’re Poor, Middle Class, Upper Middle Class or Rich