$150,000 doesn't make you rich. Discuss.

No family that earns $150,000 a year can afford a Ferrari…but that’s rich enough regardless, says Federal Treasurer Wayne Swan.

Not ‘rolling in it’ rich, but rich enough. The terms are important.

The Treasurer has been blasted for the cut-off in his middle class welfare tweaking, which now stands at $150k but there’s an argument on both sides here.

Some say the ‘rich or not’ question is clearly a diversion and we should really be focusing on whether or not those earning $150,000 combined need ‘hand-outs’.

On the other side, the goal posts have changed over the past few decades. It’s expensive to live.

In any case, the Opposition says the new class war has already been set in motion.

The Herald Sun writes:

Mr Swan, who has been accused of triggering a new class war with his decision to freeze the indexing of family payments to 40,000 families, said: “I don’t think a couple on $150,000 a year is rich, I don’t think that at all.

“Families come in different shapes and sizes and with different incomes. There are plenty of families on incomes of $60,000 or $70,000 a year.”

But given the median Australian household income is about $67,000 (that’s all households, not just families) you can see there are plenty below the $150,000 cut-off that need extra help. The Prime Minister says the money should go to those who need it most and those on $150,000 are not quite on the level.

Opposition leader Tony Abbott says the Government is punishing ‘aspiration and hard work’.

Then there’s the case for what $150,000 really means in cities across the country. Clearly, $150,000 with a mortgage, three kids and a car isn’t going to go very far in Sydney (where the Treasurer said he based his figure of $150K on). It’s just not. But that doesn’t change the fact there are still plenty earning less and living in Sydney too.

The Prime Minister dodged the question a little bit and added that those who miss out on some of the welfare still have access to schools and hospitals which the Government is also funding to the tune of billions of dollars. Not to mention child care and paid parental leave.

So, what do you think? Are families on $150,000 household incomes collateral damage in the fight to help the most needy, or should we start seriously looking at redefining what ‘wealthy’ really is?

What is wealthy?