The Official Poverty Measure & the Low-Income Standard

For a family of four, the 2011 poverty level is $22,350 a year.  However, this measure has not been revised since the 1960s.  The current poverty measure equals about 30% of median household income, whereas in the 1960s, the poverty level was nearly 50% of the median.

As a result, the official povery measure is widely acknowledged to be an inaccurate depiction of a family's ability to meet basic needs.  Research shows that families with incomes between 100% and 200% of the poverty level face material hardships and financial pressures similar to families officially counted as poor.  For example, missed rent payments, utility shutoffs, inadequate access to health care, unstable child care arrangements, and food insecurity are experiences common among families with income below 200% of the poverty level.

Research suggests that to meet their basic needs, families actually need an income of roughly twice the official poverty level ($44,700 a year for a family of four), which can include benefits like the Earned Income Tax Credit or Supplemental Nutrition Assistance Program.  To assess economic well-being, analysts refer to families with income below 200% of poverty as "low income" and use this standard in addition to the official poverty measure.

Note that both the official poverty measure and the low-income standard refer only to a family's income and do not take into account savings, homeownership, or other types of assets, which are an integral part of family economic success.

Source:  2011 KIDS COUNT Data Book, The Annie E. Casey Foundation