America loves an underdog story: no matter where you start on society’s ladder, if you work hard enough, you can achieve and prosper. From Steve Jobs launching Apple in a garage in Los Altos, to Jay-Z rapping his way out of Brooklyn’s Marcy Projects, stories of moguls who ascended from humble beginnings abound in our popular culture.


But the data reveals a different reality: where and to whom a person is born significantly impacts his or her prospects for economic success. According to the World Bank, “characteristics like gender, economic circumstances, geography, and ethnicity can trap large groups of people in poverty, and specifically affect access to basic services among children.” Rising economic inequality in the U.S. and around the world suggests that in this day and age, equality of opportunity does not necessarily translate to equality of outcomes.


This is the reality faced by many members of the new middle class. For example, our recent research indicates that when it comes to college, students’ futures can be adversely affected by their parents’ financial challenges, including poor credit. Non-prime students (those with credit scores lower than 700) are also significantly more likely to live at home and attend public or community colleges compared to peers with prime credit.

In addition, CNMC research suggests that systemic obstacles to equal opportunity based on factors like race and gender persist, and these obstacles can affect access to critical drivers of upward mobility, such as healthcare, education, and basic financial wellness:


  • Our study of non-prime Hispanic Americans found that non-prime Hispanics are significantly less likely to spend on routine medical expenses, a statistic with alarming implications in terms of this population’s physical health. And while the overall non-prime population reports inadequate retirement savings, the non-prime Hispanic community lags even further behind than most, with only 9% of the group having a retirement account. Non-prime Hispanics are also 20% less likely to have a credit card than the general non-prime population, which can make it difficult to build a history that will improve access to credit in the future.
  • Among African Americans, financial inequalities exist between prime and non-prime families and individuals, but even those with prime credit scores are more likely to face certain financial hardships than the overall prime population: for instance, prime African Americans are 80% more likely to say that they live paycheck-to-paycheck than the overall prime population, and are 28% less likely to have $1,200 on-hand to cover a financial emergency.
  • Non-prime women also face significant challenges. Compared to prime women, they are three times more likely to have lost a job in the last year, and four times more likely to have trouble predicting next month’s income. More than 4 out of 5 non-prime women admit to running out of money at least once a year, and more than one quarter admit it happens every month.

As U.S. population demographics continue to shift, systemic inequalities become increasingly difficult to ignore. Despite these obstacles, the new middle class is diverse, hopeful, and determined to seize their opportunity to build better lives and brighter futures.