ABC News has just reported that “Consumer prices rose 3.5% in March compared to a year ago, accelerating markedly from the previous month and reversing some of the progress achieved in a two-year fight to cool inflation, U.S. Bureau of Labor Statistics data showed.”
While gasoline and housing continue to remain high, “Core inflation — a closely watched measure that strips out volatile food and energy prices — increased 3.8% over the year ending in March, holding steady from the previous month, the data showed.”
These numbers, which not everyone understands, affect the average American who, no matter the reason, is faced with increasingly high prices, stagnant wages, and basic needs spiraling out of reach. America’s middle class is being squeezed, and what used to be the hallmark of the American middle class and the American dream is becoming increasingly unaffordable. If things don’t change, the average middle-class American won’t be able to afford these things in the next 5 years.
1. Owning a Home
Owning a home was always the American dream. However, it is becoming increasingly less likely for the middle class, and the American dream remains out of reach for many.
Rising real estate prices, stagnant wages, and limited housing supply will create even more significant barriers to entry into the housing market. Additionally, stricter lending requirements and higher interest rates will make it harder for middle-class families to qualify for mortgages.
2. Healthcare
Access to quality healthcare will become a luxury rather than a basic necessity for many middle-class families. As healthcare costs continue to soar, insurance premiums, deductibles, and out-of-pocket expenses will become unaffordable for a significant portion of the middle class. This will result in delayed or inadequate medical care, worsening health outcomes, and financial strain.
3. Higher Education
The cost of higher education will skyrocket, making it increasingly difficult for middle-class individuals to pursue advanced degrees or vocational training. With tuition fees rising faster than inflation and student loan debt reaching unsustainable levels, many middle-class families will be forced to forego or delay education, limiting their career opportunities and earning potential.
4. Retirement Savings
Saving enough for a comfortable retirement will become a daunting challenge for the middle class. Declining wages, diminishing employer-sponsored retirement plans, and the instability of social security will leave many middle-class workers financially vulnerable in their later years. Without adequate savings and investment opportunities, they will struggle to maintain their standard of living and face the risk of poverty in retirement.
Boomers are being priced out of retirement, and Americans are now facing a retirement crisis. Many people expected to retire do not have enough money to cover expenses, let alone the soaring cost of healthcare. This is only expected to worsen over the next few years.
5. Reliable Transportation
Owning and maintaining a reliable vehicle will become increasingly unaffordable for the middle class. As the cost of new cars rises due to factors such as inflation, technological advancements, and supply chain disruptions, middle-class families will find it harder to afford both the upfront cost and ongoing expenses associated with vehicle ownership. This will limit their mobility and access to employment, education, and essential services.
With public transportation and infrastructure declining rapidly, middle-class Americans’ need for private transportation is crucial, as they have no other options. Unfortunately, cars and gas are becoming increasingly unaffordable.
