In these tough economic times with rising inflation and high interest rates, many of us may feel quite poor. But feeling poor, versus being poor according to the government are two different things.
In fact, the Census Bureau and Department of Health and Human Services (HHS) provide actual numbers to classify poverty; and these measures are widely used for key reporting and qualification purposes.
See the tables below for the latest federal poverty guidelines and thresholds published by the HHS and Census Bureau, respectively. These are updated annually and I will post the latest figures as they are released.
Generally individuals are considered below the poverty line if making a total income below $13,590. While a family of four is considered to be “poor” if they make under $27,750 in gross income.
Latest Poverty Guidelines by Income Threshold
The current (2022) federal poverty level (FPL) guidelines published by the HHS in the federal register increased slightly from 2021 levels. Income is made up of wages and salaries, social security, interest, dividends, pensions, and other retirement income.
Federal poverty level guidelines are used to determine eligibility several benefit (e.g Food stamps/SNAP as shown below), health insurance, Medicaid, and other national programs.
|Family size||2022-2023 FPL 100% Income Threshold|
|For a family of 2||$18,310|
|For a family of 3||$23,030|
|For a family of 4||$27,750|
|For a family of 5||$32,470|
|For a family of 6||$37,190|
|For a family of 7||$41,910|
|For a family of 8||$46,630|
|For a family of 9+||Add $4,720 for each extra person|
How Federal Poverty Guidelines are Used?
The table above shows the 100% poverty income level, or baseline Federal Poverty Level (FPL). Most programs use some multiple of the federal poverty levels to determine eligibility for various subsidy and health care programs.
For example if your actual income is 400% above the FPL you would qualify for premium tax credits that lower your monthly premium in a Marketplace health insurance plan.
Latest Poverty Thresholds
The Census Bureau issues its annual poverty thresholds and the latest levels are shown below. These are used for official reporting and statistical purposes. See the section below for the differences between poverty guidelines and poverty thresholds.
Poverty Guidelines vs Poverty Thresholds
So you may hear the terms “poverty guideline” and “poverty thresholds.” While these are similar, they are not the same.
Poverty Guidelines are issued via the federal register each year by the Department of Health and Human Services (HHS). These are the primary measure used to determine the financial eligibility for certain federal programs.
On the other hand, Poverty Thresholds are a less used (but more comprehensive) measure of federal poverty levels and issued/updated annually by the Census Bureau. They are mainly used for official statistical purposes, e.g reports around “poor” Americans by state.
The poverty guidelines are backward looking/lagging (e.g 2022 levels are based on 2021 figures). They are issued at the start of the year. Poverty thresholds on the other hand are more forward looking and issued around September.
So for example the 2022 poverty guidelines are generally similar to 2021 poverty thresholds, as you can see in the tables above.
So when determining eligibility for benefit programs, reference the poverty guidelines. When you are looking for official data or statistics around poverty trends, use poverty thresholds.
2021 Poverty Guidelines
|PERSONS IN FAMILY/HOUSEHOLD||2021 POVERTY GUIDELINE|
|9 or more||Add $4,540 for each additional person.|
Food Stamps (SNAP)
Another area closely associated with poverty are food stamps. According to U.S. Department of Agriculture over 50 million Americans are receiving aid via food stamps, an all-time high.
The Food Stamp program, now officially known as Supplemental Nutrition Assistance Program (SNAP), also provides benefits which are closely tied to the poverty levels above.
SNAP income eligibility limits from Oct. 1, 2022, through Sept. 30, 2022, are shown in the table below. Households must meet both the gross and net income limits described below to be eligible for Food Stamp benefits, which are administered by their local state agency (see more in this video).
|Household Size||Gross monthly income|
(130 percent of poverty)
|Net monthly income|
(100 percent of poverty)
|Each additional member||+$512||+$394|
[Prior year poverty threshold updates] How much does your household income need to be under to be classified as poor in America? The answer of course depends on how big your household is but for the average American household of four people, the answer is $23,550 ($500 more than in 2012). The Census Bureau and Department of Health and Human Services (HHS) which publishes official federal poverty levels, estimated that over 15 percent of US households live in poverty!
Fortunately my household (of 4 people) income is well above the poverty threshold but it is hard to believe that a family could live on just $23,550 a year. Especially if they live in a mid to large size metro area. Heck, my total mortgage payments for the year are more than this amount.
Based on the latest data, the average American household makes a median income of around $50,000. Or roughly twice the poverty level. This suggests that a lot of American families are not that far from the edge of poverty. Sadly the recession has exacerbated things with income inequality growing as the rich benefit disproportionately more from booming stocks markets while the poor struggle with stagnant paychecks and rising inflation.