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Only 2% of the Latvian population consider themselves to be wealthy, while 41% consider themselves to be middle class, according to a survey conducted by Swedbank Institute of Finance.
Compared to 2019, the number of such respondents has slightly decreased - four years ago, 44% of the population identified themselves as middle class.
Another 42% feel that they belong to the social stratum below the middle class, while 11% consider themselves to be poor or low-income, and the number of such responses has increased by one percentage point.
The survey asked people to indicate the minimum monthly income per family member that would qualify a household as financially middle class. The average value calculated from the responses is €1,249, which is significantly higher than in 2019, when the survey indicated a minimum monthly income per middle-class family member of €851.
When it comes to the criteria that characterise middle-class households, 78% of people said that real estate owned by the family, such as housing or land (with or without a mortgage), is an indicator of belonging to the middle class.
Other relatively more frequently mentioned criteria are the ability to easily cover monthly loan payments, debts and other mandatory payments (66%), to go on a week-long trip abroad at least once a year (66%), to afford paid medical services (64%), and to have enough money set aside each month after mandatory payments for restaurants, spas, entertainment and cultural events, home improvements, taxi rides and other extra expenses (61%).
"We can see that the financial threshold for classifying a household as middle class has almost halved in the last four years - according to the respondents, for a family of four to be considered middle class in terms of income, the average monthly income must be at least EUR 5000," says Evija Kropa, an expert at Swedbank's Institute of Finance.
"If we assume that such a household of four has two working adults, then each of them should earn around €2,500 per month. According to statistical data, this level of remuneration is less than 10% of the employed population in Latvia and, statistically speaking, rather indicates the wealthy segment of the population," the expert says.
When assessing the criteria of the middle class in relation to their own household, it can be seen that often only a small proportion of respondents are able to meet the criteria defined above.
Most, or 60%, of the population indicated that they own real estate. A third, or 33%, can easily afford their monthly loan payments and other mandatory payments. Only 21% go on a week-long trip abroad at least once a year, while 24% allow paid medical services, and 20% of respondents are able to spare money for restaurants, spas, entertainment and cultural events, home improvements and other desirable expenses after making the obligatory payments.
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