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D.Muthukrishnan (Muthu), Certified Financial Planner- Personal Financial Advisor

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Are you in the global middle class?

Posted by Muthu on July 22, 2015

Last year, I’ve shared with you details about http://www.globalrichlist.com/ which provides your rank in the globe based on your income and wealth.

I also periodically keep sharing with you various reports on wealth and poverty.

Yesterday I stumbled upon the website of Pew Research Center.

It classifies population into 5 major categories based on their daily income.

Poor: Less than $2 a day

Low Income: $2.01 to $10 a day

Middle Income: $10.01 to $20 a day

Upper middle income: $20.01 to $50 a day

High Income: More than $50 a day

To illustrate, for a family of four in India, would be considered middle class if they have an annual income between $14,600 to $29,200, which is Rs.9.35 lakhs to Rs.18.68 lakhs (Taking 1 USD=Rs.64).

But there is something known as PPP (Purchasing Power Parity). In 2011, the year which Pew Research has taken into account, the PPP of a US dollar was equal to Rs.14.97. This roughly means it takes Rs.14.97 in India to buy something which cost $1 in U.S.

Applying purchasing power parity, the middle class income range for a family of four in India works out to Rs.2.19 lakhs to Rs.4.37 lakhs.

The percentage of global population in each of the 5 categories is as follows:

Poor: 15%

Low Income: 56%

Middle Income: 13%

Upper Middle Income: 9%

High Income: 7%

Please go through the below link

http://www.pewresearch.org/fact-tank/2015/07/16/are-you-in-the-global-middle-class-find-out-with-our-income-calculator/

It has a calculator. If you key in your inputs, it tells you how much each member of your family is earning every day in USD after adjusting for PPP. It also tells you where you fall among the population of India.

See and count your blessings.

One Response to “Are you in the global middle class?”

  1. Navin Kumar said

    Dear muthu, your post is extremely informative and thought provoking. I will be always waiting for your new post.

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