Axa has revealed that although many people think they belong to Middle Britain, in fact the majority of people do not have sufficient income to call themselves middle class.
Although a third of people consider that they belong to the middle class socio-economic category, a comprehensive survey shows that only a fifth actually meet the criteria demanded by the classification. According to Axa, the income requirements of a household need to be over 62,000 per year for them to fall into the middle class bracket. They would also have to own their home outright and have two or more cars.
The Company maintains that people in the middle class category have household incomes that fall between the 70th and 90th percentile of all salaried staff. The figure of 62,000 pounds is almost double the average wage brought home in this country, which is 35,000 pounds. They maintain that 20% of the population fall into the middle class category, which leads one to believe that the reality of the financial situation of an average Briton and the criteria for Middle Britain laid down in the survey do not match.
Although the survey records that there has been an improvement in the equality of earnings over recent years, it was unlikely that many UK residents would be joining the group. Although recent statistics show that one fifth of the UK population belonged to this group, back in 1998 the criteria was met by only 15% of people.
The spokesman of the Axa Financial Task Force, Steve Folkard says that most people maintain that Middle Britain is represented by the majority of households in the UK, the so called middle section. This opinion is probably been enhanced by the inflated housing market, which makes people think that they are wealthier than they really are. Mr Folkard adds that Middle Britain is composed of a smaller group of families than you would think, although the same stereotypes are still relevant.
There is no doubt however that like everyone else Middle Britain has suffered from the escalating cost of living. He concludes by saying that overall spending power has been affected by increasing food and fuel costs, the slump in the housing market and the tightening of loan and credit criteria. This shortage of ready cash is evident in spite of the rise in average incomes.
Nowadays, taking out a secured loan may be the only way of providing the extra equity to fund a home extension or a new car. Another conclusion from the Axa survey revealed that the cost of maintaining your home has risen to 10,000 pounds per year for people in Middle Britain due to increased council tax, mortgages and utility bills.
The Prudential has carried out research recently, which shows that paying major financial commitments has become a matter of deep concern for an increasing number of people in Britain. Over half of the people replying to their survey (52%) said that financial matters were their biggest worry. It is hardly surprising that shoplifting, petty theft and irresponsible lending have shown a sharp rise in the last year.
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