11 Things Preventing You From Going From Middle Class to Upper Middle Class

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The middle class isn’t what it used to be. Once upon a time it typically meant homeownership, a college education and general peace of mind in a financial sense. Today, being middle class isn’t so comfortable.

In fact, Many middle-class Americans are struggling to get by amid inflation. The country’s share of wealth has also shrunk, so that even qualifying as middle class is something of a feat. Therefore, going from middle class to upper middle class can feel impossible. But why? What is preventing you from climbing the ladder of wealth? Let’s explore some common barriers holding the middle class back.

Lack of Financial Literacy

Understanding how to manage, invest, and grow your money is crucial if you want to advance from middle class to upper middle class. Yet, many Americans are sorely lacking in this department.

“Only 34% of Americans could answer at least four of five financial literacy questions on a basic five-question quiz,” said Jeff Rose, CFP, founder of Good Financial Cents.

Unplanned Expenses

The importance of an emergency fund cannot be overstated — particularly when considering that unexpected expenses like medical emergencies or home repairs can derail financial plans and savings, making it tougher to build wealth and move up the ladder.

“A Federal Reserve study from 2022 found that when faced with a hypothetical expense of $400, only 63% of adults said they would cover it exclusively using cash, savings or a credit card paid off at the next statement,” Rose said. “Such unforeseen expenditures can significantly impact one’s ability to save and invest for a better financial future, especially if they occur frequently or are substantial in amount.”

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Mismatch Between Jobs, Pay and Skills Needed

Another key factor keeping Americans from moving from middle to upper middle class is a frequent mismatch between skills and jobs.

“Increasingly, STEM-type skills are needed for higher-paying jobs but the upskilling and re-skilling needed to take advantage of those opportunities can seem daunting,” said Aleksandar Tomic, associate dean for strategy, innovation, and technology at Boston College

Tomic notes that there could be other factors at play, such as a relative decrease in mobility thanks to current, high mortgage rates and steep home prices that make people less willing and able to take job opportunities that require relocation.

“It is important to notice that, in this scenario, even if the salary increase could push one from middle to upper middle class, the actual quality of life could suffer as one moves from low to high cost of living area,” Tomic said. 


Debt of all kinds is holding Americans back from moving from middle class to upper middle class. 

“Many Americans are weighed down by the number of debts that they regularly have to make payments for,” said Mafe Aclado, general manager of Coupon Snake. “Especially with the current state of the economy, and increasing rates, many have to juggle student loan debt, car loan debt, mortgage debts in addition to the increasing cost of living; groceries, utility bills and household supplies. The truth is, paying back loans, ties up funds from your income which could have been used to start up profitable wealth growing investments, or in the very least, afforded you a more comfortable lifestyle.”

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Family Financial Obligations

It’s not just our own debt holding us back. It’s also, in some situations, the debts of those we care for, or rather, the debts caregiving can create.

“It’s not just personal debt; it’s also about supporting aging parents or helping siblings,” said Matt Oguz, founding partner at Venture Science, a family-office backed venture capital investment firm. “Middle-class families often have financial obligations that can prevent them from investing or saving for their future.”

Stagnant Wages

Inflation is finally on par with wage growth, but for years that wasn’t the case, and many middle-class Americans are still playing catch-up.

“Despite productivity gains, many middle-class workers have yet to see significant wage growth in decades,” said Oguz. “With the cost of living rising faster than wages, saving or investing to advance economically becomes increasingly difficult.”

Rising Cost of Education

“Higher education is often touted as the pathway to upper-class status,” Oguz said. “However, the skyrocketing costs of college and the student loan crisis can make this pathway less accessible and riskier.”

Costs associated with higher education may be perceived as even more dismal now that student loan repayments have resumed after a years-long moratorium enacted at the onset of the pandemic. For most Americans, a higher education means many years in debt.

Steep Healthcare Costs

Americans of all classes are being slammed with high healthcare costs, but these costs tend to hit the middle class the hardest.

“Unexpected health issues can wipe out savings and plunge middle-class families into debt,” Oguz said. “The high cost of medical care and insurance can significantly deter upward mobility.”

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Limited Networking Circles and Opportunities 

“The saying, ‘It’s not what you know, but who you know,’ holds some truth,” Oguz said. “Upper-class individuals often have networks that can provide insider information, investment opportunities, and high-paying job leads. Building these connections can be more challenging for someone in the middle class.”

Regressive Tax Policies 

Tax policies that disproportionately affect middle-income earners can also create a barrier to building a financially comfortable life.  

“Progressive tax policies can help alleviate some of the financial burdens on the middle class, making it easier to move up economically,” said Rose. 

Poor Retirement Planning 

There’s a reason every finance expert preaches the importance of investing early and aggressively for retirement. Failing to do so can significantly set you back. 

“Inadequate retirement planning can leave middle-class individuals vulnerable in their later years,” said Scott Neu, AIF, financial advisor at Reinke Gray Wealth Management. “Experts emphasize the importance of taking retirement planning seriously, such as maximizing contributions to retirement accounts and considering retirement income strategies.”

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