Analytics, Banks, Latvia, Quality of life, Society

Considered as the main characteristics of middle class are the possession of a dwelling of one's own, the possibility to finance additional outlays after making necessary purchases and paying bills, the possibility to afford the purchase of a new or a second-hand car, and being able to afford a holiday trip abroad at least once a year, the the Swedbank Institute for Finances said on Wednesday.

According to the participants in the survey, people with a monthly net income of 1,450-2,200 euros can be considered middle class in Estonia.

"People aged 25-34 make up the biggest percentage among those seeing themselves as middle class. Young people also view themselves as belonging to the wealthier or upper middle class more often than average. Those considering themselves deprived or poor more often than average are people of other ethnic backgrounds of ages 50-74, with a smaller income," said the head of the institute, Kati Voomets.

Residents considering themselves well-off or upper middle class make up 7% of the population of Estonia, around half consider themselves lower middle class, and 14% perceive themselves as deprived or poor.

Those considering themselves upper middle class or middle class primarily name the possibility to go on a holiday abroad as a characteristic of the middle class. Younger people, of ages 25-34, attach importance to the possibility to buy a car as a defining trait of the middle class. People aged 35 and older name the possession of significant savings more often than average, whereas those considering themselves deprived or poor consider the possibility to afford private education for one's children as characteristic of the middle class.

According to the participants in the survey, a person with a monthly net income from 1,450 to 2,200 euros can be considered to be middle class. The perceived amount of money left over for a middle class family of four is 940 euros a month, according to the findings of the survey.

Participants in the survey find that around one-third of the country's population are middle class.

"By the criteria of income and surplus money, approximately 10-20 percent of the population are middle class in Estonia. The net income of 1,450-2,200 euros a month per family member seen as characteristic of middle class is received by about one-tenth of the residents of Estonia," Swedbank chief economist Liis Elmik said.

"In terms of savings, an estimated 20% of households are middle class, yet many families only have a limited amount of savings. More than half of the customers at Swedbank have less than 500 euros in liquid assets. If we look at physical assets and lifestyle, more than 30% of residents are middle class. Eighty percent of residents own their dwelling, more than 50%  of households own a car. At the same time, dwellings often are very small or in a poor state of repair and 40% of cars are more than 10 years old. A week's holiday away from home can be afforded by 70 percent of households," Elmik said.

The criteria for defining residents as middle class differ by country, and social scientists and economists have offered different definitions of middle class over time.

The poll was taken for the Swedbank Institute for Finances by Kantar Emor by interviewing 1,089 residents of ages 15-74 online in July 2018.