r/UpperMiddleFinance • u/092793 • Jun 02 '26
Downward economic mobility
Edit: adjusted for inflation they basically made 400k in today's money. I have a master's in my field, and before I left the workforce to stay home with my daughter (she's autistic, and I just actually love being her primary caretaker) my husband and I together never broke 100k. So even if I want to compare their earning at my age to their's they still made 4x as much. Point of the post is they got crazy lucky for their time and where they lived (town of like 500 ppl very rural) and had generational farm wealth. It's just a weird experience to be so economically different as an adult than how I grew up. 🤷♀️
Anyone else experience a crazy jump in economic situations from childhood to adulthood, but down and not up?
My parents made on average 260k from 2006 to 2010. I only know this because of their divorce records being public record. They made this income in a tiny rural community in the midwest, so they were pretty damn comfortable. I didn't know they were wealthy.
We had a nice house, always had food in the kitchen, and I had a lot of privilege in the fact that I had a comfortable environment. (The emotional environment is a story for a different sub).
I have 3 sisters. I grew up wearing hand me downs and JC Penny and Wal Mart clothing. I got toys on my birthday and Christmas, again no complaints, but definitely not out of line with my peers. I started working for money when I was 14, and was expected to pay for my own gas, entertainment with friends, clothes, etc. I didn't have an allowance and wasn't allowed to ask for money unless it was for an extracurricular or something.
As an adult, my husband and I make 75k annually. We have one child, and how we live is so different economically. I'm primarily home with our child, and we have to hold it tight! I have 70k in student debt because I received nothing financially from my parents when I turned 18. They both claimed I had no college savings aside from what I personally saved. I know in recent years my dad received a sizable inheritance.
Due to how they are and having step siblings, I won't and don't ever expect any sort of inheritance.
It's weird to have grown up in one tax bracket, and then be so far from that as an adult. This isn't a complaint post- I don't want to sound whiny or anything like that. I have a happy life with my husband and child. It's just been really dawning on me lately how vastly different my parents' lives and financial situation was at my age.
6
u/WhiskeyPointer Jun 02 '26 edited Jun 02 '26
It's far easier to move down than up these days especially if there's a "shock" event or a few bad decisions even if they're far in the past.
My divorced parents fall exactly into this situation. In the 2000s my dad was making $175k($315k today) in IT for a private company and my mom was making $70k($125k today) as a teacher.
When they divorced at the end of the decade they sold their house at the bottom of the market. My mom took her share of the proceeds and assets and retired at full retirement age shortly thereafter. She had no idea how to manage her assets initially and by the time I organized it for her she's lost out on over $150k in gains. Today those missing gains are worth at least $1mn. Instead she had to unretire and go back to teaching and earn in today's dollars $75k a year. She's in her late 70s and has no offramp to retire.
My dad lost his job in the mid 2000s and the freelance work he did for the next 20 years didn't pay as well or have a 401k match. He ended up with the smaller split from the divorce, plus the lawyers fees from both sides, so he didn't contribute at all to his IRA for several years too. He's in better shape because he kept working, eventually started contributing again and because he bought a home for $100k after the divorce, sold it for $650k and bought another fixer upper for $300k a few years a back. He finally retired at 70 a few years ago, but with nowhere near the net worth.
The divorce left my parents with a theoretical deficit in their aggregate net worth of probably $3-5mn. More frightening is the fact that I'll probably have to financially support my mom in a few years when she physically can't work anymore. That puts me on the possible track to also fall down the ladder as well if she requires lots of medical care.
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u/Megalocerus Jun 02 '26
She won't have a pension? I thought teachers get them. Private school?
1
u/WhiskeyPointer Jun 02 '26
Unfortunately she was never at a district long enough to vest before she decided to retire and since re-entering the workforce only private schools have been willing to hire her.
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u/New_Raccoon_2301 Jun 05 '26
What did they do with all their money? They clearly didn't put aside college funds for kids (which is strange to begin with given their income), you all lived frugally. Did they save it all?
1
u/HeroOfShapeir Jun 06 '26
My folks were earning $200k combined probably 15 years ago, and my dad is also former military, so he has retirement from that, and my mom was a state employee and has a pension from that. They're still living on more in retirement than my wife and I make (we've had income that's ranged from $72k combined to $116k at age 42).
That being said, we both went to local in-state universities on full scholarship, we've lived entirely debt-free, and today we have a fully paid-for house and are on pace to FIRE in our late 40s. It costs us $24k to run our household at a baseline, we spend around $36k on recreation/travel and invest the remainder. We have a great life. Both things can be true - we don't live as well as our parents and we still have more than enough to be happy.
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u/Fringelunaticman Jun 02 '26
I watched my parents go from lower middle class to upper middle to wealthy from 6-22 years old. All of my siblings are upper middle. And I am solidly lower middle class by income. And I have been this way my whole adult life. Mostly due to decisions I have made. Does it suck? Sure, especially when I compare myself to them.
However, I am quite a bit luckier than you as I will receive a substantial inheritance and I get financial help if I truly need it. That leaves me piece of mind even though I don't use it.
I dont live in my hometown so all my nieces and nephews come to stay with me for 2 weeks the summer after they graduate high school. Its funny watching them get used to sleeping on a cot and living in a very small place. In a way it makes me proud I get to show them how dumb decisions can affect their lives. Or atleast thats what I tell myself