Are you middle class? One possible definition...

Are you middle class? Surprisingly, most people who think they are middle class, are not middle class.

It's refreshing to observe how enhanced global trade flows have enabled significant numbers of people in Asia to rapidly close the gap with their American and European peers.

A recent opinion on "Being middle class" at ChrisMartenson.com (a respected American economics and finance blogger) is being able to afford a dozen of the following items what most would expect a middle class family of 4 or 5 can afford:

1. Income (from job and/or investments) to financially support yourself and your family of 4 or 5 without resorting to government assistance when it comes to housing benefits, welfare assistance, etc.

2. Reasonable health insurance/health care for your family (assuming no major debilitating conditions).

3. Reasonable dental insurance/dental care for your family (cleanings, the occasional crown, braces for a kid or two, etc. with affordable deductibles).

4. Paid off all educational loans within 10 years of graduating college / university.

5. Savings for retirement, around 10% to 15% or more of income put into a pension plan or other investments to cover retirement at age 65, medical expenses, possible nursing home care, etc.

6. Savings for both short- and intermediate-term goals (such as one replacement computer/notebook, television, or home appliance a year; a gently-used replacement vehicle every 7 years for each spouse).

7. Savings for long-term goals (having a 20% down payment towards the purchase of a house near where you currently live within 10 years of entering the job market, having higher education / university expenses at least half-covered within 18 years of each child's birth).

8. Kids' stuff: school clothes, tricycles/bicycles, inline skates or other sports equipment, uniforms or musical instruments, allowances, help with a used car when they reach driving age, etc.

9. A family vacation for a week, at least once every year or two; a family vacation for a week at least 2,000 miles away, at least once every 5 years.

10. Taking the family out to a decent restaurant (not Pizzahut) at least once per week.

11. Some new clothes and shoes each year - no need to shop for second-hand clothes.

12. Debt-free except mortgage - i.e. credit cards completely paid off every month (or at most three months).

For Asia, I would add being able to employ a live-in maid to run a domestic household while one or both spouses are at work.

If you:
- are on government assistance,
- have delayed health care or dental care because of costs,
- cannot save 10% to 15% of your income towards retirement costs,
- are not able to save the equivalent of a 20% down payment towards a house (yes I understand you may not want to own, but you know the directional goal I'm driving towards),
- cannot afford to take vacations,
- are not able to pay off your credit card every month, etc.

then you're really not what traditionally would be defined as middle class. You're struggling or you're working class or lower middle class. Even if you might have an iPhone or some of the latest fashions, you're really deluding yourself.

This goes double if both spouses work and such a lifestyle still can't be afforded. Over 50 years ago, most middle class women in the United States and western Europe didn't even work outside the home.

Obviously, we are looking at financial behavioural traits here instead of focussing on absolute income thresholds, since cost of living indices vary across different countries.

However, when it comes down to the crunch, strong leading middle class indicators include the capacity to save for a down payment on a home, deploy an emergency fund, build up children's college funds, etc.

So feel to mention some other items that would be expected of a typical middle class family, that many who think they are middle class, actually can't afford.