Only three or four years ago, it was considered relatively normal to have a high debt-to-income ratio. People bought big houses, nice cars, and plenty of toys — for themselves and for the kids. Where did it all go? On credit, of course!
But starting about two years ago, a none-too-subtle shift started. People started losing their jobs, then their homes. Families cut back on expenditures, people took a sudden interest in coupons and… well, you know the rest.
Frugality is, at least for the moment, relatively mainstream. Most families are concentrating on paying down as much debt as they possibly can. They’re forgoing certain pleasures in the name of financial stability. They’re realizing the premium put on convenience.
In short, they’re learning.
Some people even seem to be relieved by it. After a decade or two of relentless consumerism, some people are even finding comfort in minimalism. (Though most are still straining against the yoke of debt in the hopes of a new iPhone or whatnot.)
Even assuming that our thoughts do stray back to consumerism as the economy recovers, I wonder if this has affected our basic societal definitions.
It used to be that you were leveraged to your eyeballs, but were still considered middle class. At least, right up until you couldn’t keep up with the payments. I can’t really see that holding true after all we’ve been through in this recession.
Could people really be considered middle class if they’re riddled with debt? What if they don’t have debt but don’t have savings either?
Will the new middle class mean having some savings in the bank? How about driving slightly older cars because there’s still life left in them?
What do you guys think? What are the parameters of “middle class” in the post-recession years? Or do you think that things will go back to normal?
Do you think people will really be considered middle class if they’re riddled with debt?
What about people who don’t have any debt but also don’t have savings?
Folks, you tell me: What do you think the new parameters of middle class going to be?
Will people feel safe in their middle class status? Or will they be more aware how quickly things can change?