Recently, the news has been repeatedly mentioning the plight of American families, but what really changed for American families since 2019?
In 2019, a decent middle-class income for a family of four in the U.S. generally ranged from $60,000 to $100,000, depending heavily on location. In lower-cost areas (like rural Midwest or South), a household earning $60,000 to $70,000 could live comfortably. In higher-cost urban areas (like California, New York, or D.C.), it often took $90,000 to $100,000 or more to maintain a similar lifestyle.
According to the U.S. Census Bureau, the median household income in 2019 was about $68,700. For a two-parent, two-child household, that was considered just enough to cover basics like housing, healthcare, transportation, and food—without much room for saving or emergencies.
Fast forward to 2024, and that same family is wondering how their paycheck got swallowed whole before the month is even over. What changed? Everything—from healthcare and housing to groceries, car insurance, and daycare—has exploded in cost, leaving families trying to hold onto a lifestyle that now feels just out of reach.
Let’s get real about what this looks like.
In 2019, a family might’ve paid about $18,000 a year for a mortgage or rent. Today? That’s ballooned to $24,000 thanks to rising interest rates, limited housing supply, and inflation. Food, which used to average around $12,000 a year, now eats up closer to $15,000. Even just buying basics like eggs, milk, and meat costs noticeably more. A grocery run that once rang up to $150 now easily hits $200.
But the real financial gut-punch is healthcare. In 2019, a family plan might’ve cost $9,000 including premiums and out-of-pocket costs. Now? You’re looking at $13,500—if you’re lucky. And that doesn’t guarantee great coverage. Deductibles are higher, co-pays are steeper, and surprise medical bills still show up like uninvited guests.
Car ownership is another money pit. Between vehicle prices, gas, maintenance, and insurance, families are now spending upwards of $15,000 a year on transportation—up from $11,000 just five years ago. And don’t even get started on auto insurance; premiums are up over 30% in some states.
Childcare, once an expensive but manageable line item, has also risen sharply. What used to be a $10,000-a-year burden for two kids can now cost $12,000 or more, depending on location and availability. And with long waitlists and staffing shortages, parents are paying more just for the privilege of keeping their jobs.
Then there are the costs people often forget to track—utilities, internet, phone bills, college savings, clothing, and subscriptions. All of those have crept up too. Utilities alone now average $6,500 a year, up from $5,000. In total, a middle-class family’s basic budget that was around $72,000 in 2019 has climbed to more than $97,000 in 2024. That’s a 35% increase—yet most incomes haven’t kept pace.
So how are families making it work? A lot of them aren’t—not without cutting corners. Many are skipping vacations, pausing retirement contributions, or relying on credit cards to float everyday expenses. Some parents are working second jobs or gig work on the side just to fill the gap. And even then, many are falling behind.
This is more than just economic stress. It’s a lifestyle squeeze that reshapes expectations. Homeownership? Delayed. Having kids? Maybe one instead of two. Retirement? Pushed out indefinitely. What used to be standard for the middle class is now a struggle.
What’s behind this shift? Part of it is inflation, sure. But deeper than that, we’re seeing the long-term consequences of policy decisions that have allowed healthcare, housing, and education costs to skyrocket unchecked. Add in global supply chain issues, labor shortages, and rising debt costs, and you get a pressure cooker that’s now blowing the lid off household budgets.
Healthcare is a perfect example. The U.S. spends more per person on healthcare than any other developed nation—and still has worse outcomes. Insurance companies rake in profits, hospital systems charge wildly inconsistent rates, and pharmaceutical prices remain largely unregulated. Until there’s real reform—like price transparency, competitive bidding, and better oversight—costs will keep rising.
Housing faces its own set of challenges. Zoning restrictions, limited building, and investor-driven buying have pushed prices far beyond what average families can afford. Renting isn’t much better, with year-over-year hikes and fierce competition for livable spaces. Without a serious increase in affordable housing, supply will stay tight and prices will stay high.
Then there’s transportation. Vehicles are more expensive due to lingering supply shortages, high interest rates, and increased costs for repairs and insurance. Even the used car market is out of whack. Families who used to trade in and upgrade every few years are now holding on longer—and paying more to do so.
And food? It’s been hit by everything from weather-related supply disruptions to labor shortages and shipping delays. Corporate consolidation in the food industry has also played a role, allowing fewer companies to control prices.
So what’s the path forward? There’s no magic bullet, but there are steps that could help stabilize costs and support families. That means:
- Reforming healthcare to reduce administrative waste and rein in pricing
- Encouraging housing development to expand supply and reduce prices
- Supporting energy infrastructure and deregulating where it makes sense to lower utility and gas bills
- Investing in workforce training to help families qualify for better-paying jobs
- Cracking down on monopolies and price gouging in essential sectors like food and insurance
At the same time, federal and state governments need to rethink how they spend—and borrow. Trillions in national debt drive inflation over time. When the government overspends, it competes with private demand and pushes prices higher, raising the cost of borrowing for everyone.
Families can only tighten their belts so much. Without real structural reforms, they’ll be stuck running faster just to stay in place. That’s not sustainable, and it’s not the American dream.
We’re at a crossroads. Policymakers can either confront the cost-of-living crisis head-on or keep pretending that “wages are rising” tells the whole story. Because for millions of families, the math just doesn’t add up anymore.