America’s middle class was a segment of society that promised stability and security, a lifestyle that included dining out, buying a home, and having a family vacation. Fast-forward a decade, and things look very different. With inflation so high and wages remaining stubbornly flat, many of the bulwarks of middle-class life have surged out of feasible reach.
According to the National True Cost of Living Coalition, sixty-five percent of Americans often considered “middle class” – those earning more than 200 percent of the federal poverty level (FPL) – are struggling financially today and don’t expect that to change for the remainder of their lives.
As you peruse this list, you will notice just how much changing economic patterns and higher living costs have altered the middle-class lifestyle, transforming experiences into moments of luxury.
Eating out at midrange restaurants
Going out to eat at a family-friendly sit-down restaurant used to be a regular treat. Not anymore. Between 2014 and 2024, findings from The Food Institute revealed that most restaurants raised prices by 60% on average during the time period, which has made it almost impossible for most middle-class families.
This change has also affected restaurants, with many middle-market players finding it increasingly hard to draw steady waves of customers. In addition, families are cutting back on eating out as home-cooked meals become even less expensive.
Buying a home
The dream of home ownership has been steadily receding for middle-income earners. As a result, mortgage rates have jumped to over 7%, vastly driving up monthly payments. According to ListWithClever, the median home price increased by 63% over the last decade, rising from about $264,800 to $431,000, while overall inflation rose approximately 31% in that time.
This has caused many prospective homebuyers to abandon their dream of homeownership and rent longer. Unfortunately, spiking rental costs also pinch budgets, making less and less room for people to save for future purchases.
Taking family vacations
Planning an annual trip was routine for families ten years ago. However, with airfare costs rising by 25 percent in some cases and hotel rooms at a premium, family vacations have become a luxury. Only 46% of U.S. adults planned to travel this summer; 24% were skipping a summer vacation altogether, according to Bankrate.
Many families also adapt by exploring cost-effective travel options like camping trips or driving to nearby locations. These activities allow families to bond and build lifelong memories without breaking the bank on vacations.
Owning a new car
A decade ago, rolling away in a new car was an attainable goal. An average new car costs more than $48,699 according to CarEdge, and many families keep their older vehicles on the road longer. Those two-wheel options are also more expensive when you consider financing them; interest rates for auto loans have risen to a decade-high.
The increasing cost of maintaining older vehicles has also been a factor for households.
Higher education for children
Tuition at four-year colleges has increased by at least 30%, and when living expenses are included, a higher education is one that few can afford. In many households, families are left to pick up the slack by taking on loans or forgoing other financial needs.
Scholarships, grants, and community colleges are increasingly seen as key strategies to increase access to education. Families are also looking for alternate routes, like online learning, which can be a more affordable bridge to a degree.
Cost of health care coverage
Healthcare costs are still outpacing wages, which is leading the middle class to see premiums, deductibles, and out-of-pocket costs rise. According to the Centers for Medicare & Medicaid Services (CMS), total national health expenditures in 2013 amounted to approximately $2.9 trillion, which works out to about $9,255 per person.
This economic hardship is causing numerous households to postpone or forgo essential treatments, which may lead to worsened health consequences in the long run. Politicians and advocates are increasingly urging reforms to make care more affordable and accessible for the middle class.
Going to concerts or theaters
A live concert or a Broadway show has become a special treat. The cost of tickets more than doubled in response to platform fees and demand. According to SeatGeek, average concert ticket prices have doubled from $125 in 2019 to $252 in 2023. Today, many opt out of the events altogether or compromise by tuning into home TV performances.
Childcare services
Currently, parents are already paying up to $800 a month or more in childcare, a hefty sum putting a squeeze on household budgets, according to the Center of American Progress. Families are forced to make tough decisions, including one parent choosing to stay at home to avoid the cost of child care.
As a result of this financial pressure, many families have had to rely on relatives or informal childcare when money is scarce. Some have offered employer-sponsored childcare assistance or government programs to ease the crunch.
Utilities for the modern household
Once just another bill, but now significantly higher than it was 10 years ago, the electricity and heating bill rates have increased by just under 22% nationwide over the last decade, and from 2015 to 2023, according to data from the U.S. Energy Information Administration (EIA).
In the face of escalating bills, many families have switched to energy-efficient appliances and home automation technology to save energy and money. Furthermore, renewable energy sources, including solar cells, have also gained considerable attention as a long-term solution to minimize utility bills.
Owning a pet
Adopting a furry friend into the home used to be a relatively painless, inexpensive experience. But today, veterinary costs and general pet expenses have skyrocketed, making pet ownership more prohibitive for those in the middle-income bracket.
The American Veterinary Medical Association (AVMA) reports that the average annual veterinary expenditure for dogs is around $580 per household. Pet food, grooming, and training services add to the increasing financial burden of pet ownership.
Key takeaways
The middle class once symbolized stability and attainable comforts, but economic shifts over the last decade have upended many of those experiences. Increasing costs of all life’s “necessities,” including housing, healthcare, and education, stretch the budgets of middle-class families. Financial distress is pushing middle-class families to make terrible choices all the time.
Disclaimer – This list is solely the author’s opinion based on research and publicly available information. It is not intended to be professional advice.
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