Talking about middle class in California is no longer as simple as before; what a few years ago represented economic stability, today can mean just enough to cover it The increase in housing, food, transportation and health, in short, the cost of living, has completely changed the income level necessary to live in the state.

According to a SmartAsset study, a home in California is considered middle-class if you earn between $63,674 and $1 $91,042 per year. This range is not fixed, it changes depending on the city, type of home and local cost of living.

According to Kevin Marshall, a certified public accountant (CPA) and contributor to Smithii Tools, it takes about $63,674 dollars a year, but he clarifies that this changes because some cities They are much more expensive than others. In places like San Francisco, the necessary income rises to about $84,488, while in San Jose it can reach approximately $90,810.

“That's because rent, gas and certain expenses are more expensive in different cities,” Marshall said.

Why does $100,000 no always mean being rich?

For years, earning six figures in the United States was synonymous with financial success; however, that perception has changed, especially in high cost-of-living states like California.

Today, an $100,000 dollar income can be placed even in the lower or middle of the middle class spectrum, depending on the household size and city. In some analyses ba According to the Pew Research Center, this income may fall within the so-called “lower middle class,” as it is considered the bottom third of the middle class range in certain states.

This approach defines the middle class as households that earn between two thirds and double the state median income. Within that range, those who are closer to the lower boundary are classified as lower middle class.

This doesn't mean that $100,000 dollars is not a solid income, but that purchasing power has reduced in the face of the increased cost of living.

The large discrepancy between studies and why it occurs

The difference between the SmartAsset data and other studies like MoneyLion could generate confusion, because the results are considerably discreative tes. The main reason is that there doesn't exist a single definition of “middle class” in the United States and, particularly, each study uses different methodologies.

SmartAsset uses data from the U.S. Census and calculates ranges based on the median income of each state or city. Instead, MoneyLion is based in the Pew Research Center's methodology, which defines the middle class as a percentage of median income (two thirds to two times median income).

This causes important differences. While one measurement focuses on broad ranges of income by location, the other divides the population into s more strict egments within that range. For that, the same salary can appear as “middle class” in one study and “lower middle class” in another.

A state where it costs more and more to live

Beyond the numbers, the main problem remains the same: California is one of the most expensive states in the United States. Even with high incomes, many families face difficulty saving.

Marshall points out that even a family with $130,000 dollars can spend almost $29,753 dollars more than in other states, just because of the cost of living.

“And on top of all that, there are very high taxes. There is an income tax of 13.3% and a sales tax of 8.8%, and when all that is added up, it is difficult to save money,” he recalled.

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