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Rachel Cruze: How to budget and save money
Financial expert and media personality Rachel Cruze stopped by FOX 35's Good Day Orlando to talk about budgeting, how to make a budget, how to save money, wants vs. needs, and how to build an emergency fund.
A new study by Consumer Affairs has figured out the minimum annual income required for a family of four to be considered middle class in each state.
The middle class is capturing a lower share of income than in the 1960s, 1970s, and 1980s, according to Oliver Rust, head of product at independent inflation data aggregator Truflation.
Rust said during an interview with Consumer Affairs that in the two decades since the mid-2000s, the portion of the country that is middle class has shrunk from roughly 60%. Instead, there has been a steep increase at the extreme bottom and top of the economic spectrum.
Inflation has surged in the past few years, peaking at 9% in June 2022. That means some families who were middle class in 2020 may no longer be in that category. The Pew Research Center says the share of adults who live in middle-class households fell from 61% in 1971 to 50% in 2021.
So what is the minimum annual income required in 2023 for a family of four to be middle class in Florida? Consumer Affairs found that number by using a calculator provided by the Pew Research Center and an inflation calculator provided by the U.S. Bureau of Labor Statistics.
The answer is $67,835. That's slightly higher than the minimum annual income required to be considered middle class in Georgia, which is $65,364.
In Colorado, the minimum annual income is $69,064. In Indiana, it's $62,897. In Iowa, Missouri and Kentucky — $61,664.
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Hawaii tops the list, with an annual income of $82,630 required to be considered middle class. Other states topping the list include the District of Columbia and New York (tied for No. 2), New Jersey and Connecticut (tied for No. 3), and Massachusetts (No. 4). The bottom five include Alabama, Arkansas, Arizona, West Virginia and Mississippi.
A different study earlier this year by SmartAsset analyzed the high and low ends of the range of middle-class salaries in 100 large cities and all 50 states. Here is what that study found for several cities in Florida, including Jacksonville, Orlando, and Tampa.