Services That Americans in the Middle Class Won’t Be Able to afford for This in the Next Five Years

Services that middle-class families might no longer be able to afford.

For a long time, the American middle class was considered the backbone of the nation’s economy. But with inflation now pacing ahead of wage growth, many families find it difficult to sustain their lifestyles.

Key services middle-class Americans may soon be unable to afford: Below, we assess the rise in personal financial burdens and what that may mean for individuals and society over the longer term.

Impact on Middle-Class Families:

Middle-class families in particular are already feeling the effects of this upward trend:

Results of this uptrend are already being felt, especially among middle-class families, through:

Many turning to high-deductible plans in order to lower the monthly premium. This often leads to delayed care as people avoid seeking treatment to save money.

Others are opting for less comprehensive coverage, leaving themselves vulnerable to catastrophic medical expenses.

Mastery of these dynamics is increasingly important for anyone interacting with today’s healthcare system. With costs continuing to escalate, making responsible choices regarding health plans and options of coverage grows more critical each and every day.

The implications of these choices are long-term. Forgoing preventive care invites substantially worse health problems later on, often at a much higher cost.

Moreover, coverage that is not adequate can lead to medical bankruptcy, one of the leading causes of financial ruin in America.

Rising Subscription Fees:

As these numbers continue to rise because of inflation, the typical middle-class family will consider some tough choices regarding its entertainment budgets.

In 2023, almost all major streaming services raised their prices for ad-free subscriptions.

Adapting to Entertainment Costs:

Tactics such as this not only control the expense involved but also symbolize a shift in middle-class American thinking regarding entertainment.

While practical, such strategies may result in having reduced contact with a large array of cultural content and shared experiences.

Premiums for Health Insurance: The Increasing Cost of All-Inclusive Healthcare:

Over the past decades, health care costs have increased faster than general inflation in the United States.

Yet this shows no signs of slowing down and makes the dream of comprehensive healthcare coverage increasingly out of reach for middle-class families without robust employer-sponsored health plans.

Employer-Sponsored Health Plans

The Milliman Medical Index projects the cost of healthcare in 2024 for a family of four enrolled in an employer-sponsored health plan would be $32,066.

That is quite a substantial expenditure. It shows the continued problem both employers and employees have in managing their health care costs.

Private Health Insurance

Speaking of private health insurance, the record-high cost is what Americans will be expected to pay.

According to ValuePenguin, in 2024, individuals might expect to pay an average of $584 a month, or $7,008 annually for private health insurance.

With that in mind, such high costs bring forth a need to be informed and prepared regarding healthcare expenses.

Healthcare Insurance Premium Increases: A Historical Perspective

• Over this same span, employee premium contributions for single and family plans rose at an average annual rate of more than 4%.
• Between December 2005 and December 2022, the implied total-premium index rose 77.9%, which is an average annual increase of 3.4%.
• In 2020, single coverage health insurance averaged $7,149, an increase of 2.5% over the previous year. This is a bit more modest compared to the average annual increase in single premiums seen from 2008 to 2020 at 4.2%.
• In 2023, the average per-employee cost of employer-sponsored health insurance increased 5.2% to $15,797. Another big jump looms in 2024, employers are warned.

Rising Costs of Public Universities:

Public universities generally remain far more affordable, but price increases are still very high. At public four-year universities, the average tuition and fees for in-state students for the 2023-2024 academic year came in at $11,260.

That is up $270 from the 2022-2023 academic year, a jump of 2.5%. Tuition and fees for out-of-state students at public four-year universities reached an average of $29,150 for 2023-2024.

Rising Student Loan Debt:

The Department of Education estimates students nationwide will, on average, borrow about $37,850 in federal student loans, the borrowing of which starts in March 2024. It is an astonishing number, if truth be told, because it really puts a point on the extreme financial burden most students must endure to pursue higher learning.