According to Pew Research Center’s 2016 report median upper-income class income is $187,872. With such income a family of four can have a comfortable lifestyle as long as they don’t reside in San Francisco, New York or Miami. Economists forecast GDP growth will be 2% in 2020 and 1.8% in 2021. Job and wage growth will definitely be affected. So what does one do to stay in upper middle class and continue enjoying their lifestyle?
Don’t Buy a Brand New Car
Don’t even think about Tesla, especially if your neighbor bought one and then rationalized with you that savings on gas alone worth of paying $85,000 sticker price for this autonomous electric miracle. If you have to buy a car you should consider two or three year old used vehicle and check CarMax, Carvana and CarGurus
Be Happy With Your Job
These past few years really spoiled many employees in this hot job market. My friend who’s engineer at a large retailer in Charlotte was telling me that he’s being courted by recruiters every week. Promises of salary increase, sign-up bonuses and relocation packages are very common in today’s job market. When slow down comes in 2020 companies will start tightening their belts and layoffs will begin. I strongly believe that in a tighter job market loyal and tenured employees will be valued more than those who were hopping around every year or so.
Additional Sources of Income
When I still had my corporate banking job I had my wife to start property & casualty insurance agency. She worked during the day and I helped her at night and during the weekends. Within several years, our agency’s net income was over $100,000. A friend of mine invests in residential real estate. So far he has only three properties, but he’s building his passive income slowly but steadily. Or you can start Upwork part time gig in the area you are expert in, such as accounting, writing, programming , legal services, design or sales and marketing.
Don’t Eat Out if You Have to Leave a 20% Tip
Growing up in Europe I didn’t have to care about tipping at the restaurants. Here in the U.S. it’s another story. Every time you go out and eat at a full service restaurant you have to leave the tip and most likely buy overpriced Mojito. Stay at home, prepare a meal and you’ll be surprised how much money you save. Or if you like me and just can’t cook, then eat fast-casual dining restaurants like Panera Bread, Chipotle or Bento.
Refinance Your Mortgage
I am in the process of refinancing my mortgage into 15 year fixed rate mortgage. My interest savings will be close to $72,000. Mortgage rates are low right now so take advantage of this and check with your bank or Better.com