6 Things the Upper Middle Class Won’t Be Able To Afford in 5 Years

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For many Americans, the economy seems to feel tighter every single day. But with costs rising and wages stagnating, many upper-middle-class Americans are getting priced out of major purchases that once seemed commonplace.

Here’s a look at some of the many things that the upper-middle-class Americans might not be able to afford in five years.

Single-Family Homes in Many Cities

Home prices have grown dramatically in recent years. Although U.S. housing costs are predicted to return to “normal” by 2030, according to Redfin, the new “normal” price point might be too steep for even those in the upper middle class in some locations.

In some places, single-family homes already seem out of reach for upper-middle-class Americans. For example, the California cities of Los Angeles, San Jose, Long Beach, San Francisco, plus New York, New York, each have a house price-to-income ratio above 10, according to Construction Coverage. That means that the median home price is 10 times more than the median income. For many, this means homeownership is already out of reach.

Unfortunately, housing unaffordability might be coming to other desirable cities across the nation, pricing out even the upper middle class.

Childcare

Child care costs can add up quickly, with the national average price of child care sitting at $13,128 in 2024, according to ChildCare Aware of America.

Since 2017, annual child care costs for two young children have increased by 40%, per the Urban Institute. That breakneck pace is significantly higher than the overall inflation rate. But many parents of young children are forced to spend more and more of their paychecks on daycare expenses.

If costs continue to rise without a similar boost to wages, it’s easy to see how even upper middle class Americans may not be able to afford child care in the coming years.

New Cars

As of the first quarter of 2025, the average car payment for a new car was $745, according to Experian. For used cars, the average payment dropped to $521.

For an upper-middle-class household with two new cars, the payments alone could easily top $1,500 per month, even before factoring in other car expenses, like gas, maintenance and insurance. And, notably, this is an average, which means that many upper-class households are spending more on car payments to drive a luxury model.

With new car prices topping $50,000, according to Kelley Blue Book, the soaring costs could put new cars out of reach for many Americans. For the upper middle class battling high housing costs and rising expenses, footing the bill for a new car purchase might not be in the budget.

International Vacations

As budgets are pinched in all directions for essentials, like housing, transportation and food, vacations of all kinds might be the first to go. Even the upper middle class might opt out of international vacations in order to keep up with their bills at home.

Cutting back entirely might not necessary. But it’s likely that many will scale back future vacations or simply take fewer vacations to make their budget work.

Retirement

It’s no secret that paying for retirement is getting expensive. And, unfortunately, many Americans aren’t building large enough nest eggs to support themselves during their golden years.

A recent Transamerica Institute study found that as of 2023, those in the middle class who haven’t retired yet had saved $66,000 across their household retirement accounts. And middle-class retirees reported $186,000 in total household savings, minus home equity. For many, that’s simply not enough to support a secure retirement, even when you factor in Social Security.

Although the upper middle class has a relatively high income, many aren’t saving enough for retirement. In fact, over half of Americans making six figures are still living paycheck to paycheck, according to a report from Bank of America Institute. Presumably, this leaves them without enough left over to build a retirement fund.

Final Take To GO

Life seems to be getting more expensive. If costs continue to rise and wages don’t keep up, even America’s upper middle class may struggle to cover everything.

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