Key Terms

Household Survival Budget: The bare-minimum costs of basic necessities (housing, child care, food, transportation, health care, and technology).

ALICE Threshold: The average income needed to afford the Household Survival Budget. Households below the ALICE Threshold include both ALICE and poverty-level households.

ALICE: Households with income above the Federal Poverty Level but below the basic cost of living.

Poverty: Households earning below the Federal Poverty Level

Total Households: The number of households as reported by the American Community Survey.

A person in a dark blue, puffy hooded jacket walks away from the camera and down a supermarket aisle with household items stacked on the shelves on both sides. The person carries a shopping basket containing only the few items they could afford as they walk toward the checkout lanes.

The ALICE Essentials Index

Inflation is one of the most widely utilized indicators of economic health. When prices increase faster than wages and other sources of income, purchasing power decreases and households struggle to make ends meet. This is especially challenging for households that are ALICE — Asset Limited, Income Constrained, Employed, with income above the Federal Poverty Level (FPL) but below the cost of basics included in the ALICE Household Survival Budget.

The ALICE Essentials Index measures changes over time in the costs of the household basics that matter most to ALICE and poverty-level households: housing, child care, food, transportation, health care, and basic technology. The traditional measure of inflation, the Bureau of Labor Statistics' Consumer Price Index (CPI), tracks a much larger basket of over 200 goods and services — items that financially insecure households can't afford on a regular basis, like wine, major appliances, airline tickets, jewelry, and full-service meals at restaurants. Tracking costs over time using this larger basket of consumer goods and services conceals important changes in the costs of basics and fails to capture the disproportionate impact of inflation on lower-income households.

This page defaults to national data. To add state-level data, select an ALICE partner state below.

SELECT STATE:

The Cost of Household Basics is Rising

The cost of basics has consistently outpaced the larger basket of goods and services tracked in the CPI. Adjusting the ALICE Essentials Index to the CPI base value of 207 in 2007 provides a common starting point to track change over time. Since 2007, the ALICE Essentials Index (gold line) has increased faster than the CPI (blue line) nationwide.

United States Inflation Indices, 2007–2025

download
View Notes
View Source
Note: In this figure, the ALICE Essentials Index was adjusted to the CPI base value of 207 in 2007. As shown by the dotted lines, ALICE Essentials Index rates for 2024 and 2025 (based on preliminary data through March 2025) are projections.
Sources: ALICE Essentials Index, 2007–2025; Bureau of Labor Statistics—Consumer Price Index, 2007–2024; Bureau of Labor Statistics—Occupational Employment and Wage Statistics, 2007–2023

Comparing Inflation Rates Over Time

Inflation rates have fluctuated over time. Nationally, during the period of 2010–2024, rates were highest for both the ALICE Essentials Index and the broader CPI during the COVID-19 pandemic (each reaching about 8% in 2022). For most other years, the ALICE Essentials Index has generally been higher. Notably, between 2016 and 2019 — the latter part of the economic recovery from the Great Recession — the CPI reached a low of 0.6% and didn’t rise above 2%, while the ALICE Essentials Index rates were double that, reaching 4% in 2018. Most recently (2022–2024), rates for both measures were down from the pandemic high, yet in 2024 the CPI had fallen to 3%, while the ALICE Essentials Index is projected to be 5.9%.

Annual Inflation Rate, ALICE Essentials Index and Consumer Price Index, 2010–2024

download
View Notes
View Source
Note: As shown by the dotted lines, ALICE Essentials Index rates for 2024 are projections.
Sources: ALICE Essentials Index, 2007–2025; Bureau of Labor Statistics—Consumer Price Index, 2007–2024; Bureau of Labor Statistics—Occupational Employment and Wage Statistics, 2007–2023

Rising Wages Still Can’t Cover Essentials

While wages have risen in recent years, so have costs — and recent wage increases have not been enough to overcome years of falling behind. As a result, many workers still cannot cover household essentials.

Median Annual Wages of Selected Common Occupations vs. Annual Total ALICE Household Survival Budget (One Adult, One School-Age Child), United States, 2023

download
View Notes
View Source
Note: Annual total ALICE Household Survival Budget is for one adult and one school-age child. The latest data for the ALICE Threshold is from 2023.
Sources: ALICE Essentials Index, 2007–2023; ALICE Threshold, 2007–2022; American Community Survey, Public Use Microdata Sample (PUMS), 2007–2023; Bureau of Labor Statistics—Occupational Employment and Wage Statistics, 2007–2023

In 2010, there were 240 occupations listed by the U.S. Bureau of Labor Statistics with median annual wages that could not support the median Household Survival Budget for one adult and one school-age child. Yet despite wage increases in all but six of these occupations from 2010 to 2023, none of them could support the median Survival Budget in 2023 either. Farmworkers and laborers; crop, nursery, and greenhouse workers; personal care and service workers; passenger attendants; grounds maintenance workers; and counter and rental clerks had median annual wages that increased by more than 60% since 2010 but still couldn’t support the Household Survival Budget in 2023.

In addition, some occupations actually lost ground during this period, even though their wages grew. For example, highway maintenance workers, dental assistants, and medical appliance technicians could afford the median Household Survival Budget for one adult and one school-age child in 2010, but not in 2023.

Inflation in Basic Costs Varies By Location

Between 2007 and 2024, household essentials were 19% to 29% more expensive in urban areas than in rural areas. Costs increased at similar, relatively low rates until 2016, when the cost of essentials began increasing faster in urban areas and continued on that trajectory through 2021. Rates increased substantially in both areas from 2021 to 2025, but the rate in rural areas (4.9%) was lower than in urban areas (5.4%).

ALICE Essentials Index, Urban vs. Rural Counties, United States, 2007–2025

download
View Notes
View Source
Note: For ease of comparison, ALICE Essentials Index–Rural is set to start at 100. As shown by the dotted lines, ALICE Essentials Index rates for 2024 and 2025 (based on preliminary data through March 2025) are projections.
Source: ALICE Essentials Index, 2007–2025

The ALICE Essentials Index provides comparable measures of inflation for the four Census Regions of the U.S. By 2025, basic household goods were most expensive in the West and Northeast, less expensive in the South, and least expensive in the Midwest.

Over time, costs and inflation rates for household basics have varied across regions. For example, in the West, inflation was relatively gradual from 2007 to 2016 but then began increasing at a faster rate, eventually surpassing basic costs in the Northeast. In the South and Midwest, inflation had slowed down prior to the pandemic, but then sped up again by 2021.

All regions experienced the most substantial increase in costs during the period of 2021 to 2023, with the ALICE Essentials Index increasing at an average annual rate of 6% in the Midwest, 6.2% in the West, 6.6% in the Northeast, and 6.7% in the South.

ALICE Essentials Index by Region, United States, 2007–2025

download
View Notes
View Source
Note: For ease of comparison, regional ALICE Essentials Indices are set to start at 100. As shown by the dotted lines, ALICE Essentials Index rates for 2024 and 2025 (based on preliminary data through March 2025) are projections.
Source: ALICE Essentials Index, 2007–2025

Policy Implications

The CPI is integrated into government policy, informing interest rates, cost-of-living increases for public assistance programs, and more. Yet it does not provide policymakers with a full picture of who is bearing the brunt of inflation, or how the effectiveness of social insurance programs is diminished as benefits continue to fall further behind the cost of basics. As a result, many government policies fall short in their efforts to support workers and reduce hardship. This is especially true for the programs most relevant to ALICE households, including inflation strategy; tax brackets and credits; the annual increase of benefits in a range of programs from Social Security to pensions for veterans and civil servants; and the annual increase of the FPL (as well as programs with eligibility based on the FPL, like the Supplemental Nutrition Assistance Program (SNAP) and Medicaid).

For example, each year, Social Security and Supplemental Security Income (SSI) make a Cost of Living Adjustment (COLA), which is based on the CPI. But the costs of many of the essential goods and services purchased by households headed by someone age 65 and over increase faster than COLA, contributing to financial instability. Nationally, in 2010, the average SSI payment was $8,088, while the ALICE Household Survival Budget for Duval County, Florida — near the national average — was $21,528 (a shortfall of $13,440); in 2023, the average SSI payment increased to $10,968, while the Household Survival Budget increased even more to $33,852 (a shortfall of $22,884).

ALICE Household Survival Budget vs. Average SSI and Social Security Payments, United States, 2010 and 2023

SSI
Payments
2010
Survival
Budget
2010
SSI
Payments
2023
Survival
Budget
2023
Social
Security
2010
65+ Survival
Budget
2010
Social
Security
2023
65+ Survival
Budget
2023
download
View Notes
View Source
Notes: SSI is compared to the Household Survival Budget for a single adult in Duval County (Jacksonville), FL, roughly the median county in the U.S. for income; Social Security is compared to the ALICE 65+ Survival Budget for a single adult age 65+ in Duval County, FL. For more details on the ALICE Household Survival Budget and the 65+ Survival Budget for your state and for various household compositions, visit UnitedForALICE.org/Income-Status-Tool.
Sources: ALICE Household Survival Budget, 2010 and 2023; Social Security Administration—Social Security Changes, 2010 and 2023; Social Security Administration—Old-Age and Survivors Insurance (OASI), Table 5A.1, 2010 and 2023

Learn More and Take Action

By increasing the accuracy of data on hardship, ALICE measures are designed to help lift all boats. Improving conditions for ALICE families will in turn fuel economic growth, benefiting all households, communities, and businesses across the country.

A small group of young colleagues sits around a laptop in an office setting, actively engaged in discussion.

ALICE In Action

See examples of partners turning data into action to make a difference for ALICE.

Learn More
Close up of a person's hands using a calculator to count money and pay expenses

ALICE Budget and Income Status Tool

View customized budgets and input household information to see ALICE status.

Learn More
Washington D.C. - U.S. Capitol Building East facade

ALICE Legislative District Tool

See how financial hardship differs by legislative district at the state and national level.

Learn More

Components of the ALICE Essentials Index

Budget Items Included in the ALICE Essentials Index
Description and Sources
Percent Change
2007-2023
Housing
110% of Fair Market Rent (FMR). Unit size and type correspond to the household (i.e., an efficiency apartment for one person, a one-bedroom rental for two people), including utilities, adjusted in metro areas using Small Area FMR.
Source: U.S. Department of Housing and Urban Development
76%
Child Care
Cost for registered Family Child Care Homes for infants (0–2 years), preschool-age children (3–4 years), and school-age children (5–12 years)
Source: State agency responsible for child care reporting (e.g., Child Care Aware of Washington, Maryland Family Network)
63%
Food
USDA Thrifty Food Plan by age, with county variation from Feeding America
Source: Feeding America; U.S. Department of Agriculture (USDA)
37%
Transportation
Operating costs for a car (average daily miles by age, cost per mile, license, fees, and insurance), or public transportation where viable
Source: AAA, Federal Highway Administration, National Association of Insurance Commissioners (NAIC) (car); Consumer Expenditure Survey (CEX) (public transportation)
51%
Health Care
Health insurance premiums based on employer-sponsored plans plus out-of-pocket costs for households with $40,000–$69,999 annual income by age, weighted with the poor-health multiplier. For the ALICE 65+ Survival Budget, cost of Medicare Parts A and B, out-of-pocket costs, plus average out-of-pocket spending for the top five chronic diseases as reported by CMS.
Source: Centers for Medicare & Medicaid Services (CMS); CEX (health); Medical Expenditure Panel Survey (MEPS)
37%
Technology
Basic broadband internet at home and a smartphone plan with unlimited data for each adult in a household
Source: Consumer Reports; USTelecom  
70%

ALICE Essentials Index Budget Items, Share of Total Budget, United States, 2023

State-by-State ALICE Essentials Index Comparison

StateALICE Essentials IndexHousehold Income Status
 Annual Rate of
Change
2010–2024
Annual Rate of
Change
2021–2024
Number of
Households
(2023)
% Households
Below ALICE
Threshold
United States3.36.2130,465,66742%
Alabama2.96.32,024,23646%
Alaska2.75.1270,64433%
Arizona3.68.12,902,61344%
Arkansas3.16.21,212,99244%
California3.75.213,693,61646%
Colorado4.36.42,402,29737%
Connecticut2.64.91,442,96940%
Delaware2.87.3412,04840%
District of Columbia3.24.4334,67333%
Florida3.17.98,944,46947%
Georgia3.98.34,087,73545%
Hawaii2.74.2493,92045%
Idaho3.26.2721,35141%
Illinois2.96.05,068,02937%
Indiana2.96.22,730,48938%
Iowa2.95.71,320,74537%
Kansas2.95.41,174,78838%
Kentucky3.26.91,808,14444%
Louisiana3.05.61,819,90550%
Maine2.95.3605,19940%
Maryland2.85.82,376,78539%
Massachusetts3.75.72,799,70943%
Michigan2.75.54,076,98441%
Minnesota3.35.82,322,75535%
Mississippi2.85.61,147,09749%
Missouri3.05.52,524,38540%
Montana3.14.5467,55838%
Nebraska2.84.2803,42435%
Nevada3.16.91,222,03444%
New Hampshire2.95.3564,14235%
New Jersey3.16.23,538,13139%
New Mexico3.15.6842,32546%
New York3.66.87,787,20048%
North Carolina3.66.14,352,60742%
North Dakota3.04.4330,13933%
Ohio2.85.44,894,15339%
Oklahoma2.951,572,19245%
Oregon3.85.31,738,33342%
Pennsylvania3.05.75,308,84540%
Rhode Island2.97.0440,67539%
South Carolina3.26.82,156,51342%
South Dakota3.15.6367,06336%
Tennessee3.67.82,852,75444%
Texas3.36.111,178,97242%
Utah3.36.21,153,29334%
Vermont3.26.3272,23940%
Virginia2.76.43,368,53539%
Washington4.58.03,094,07338%
West Virginia2.94.6726,21446%
Wisconsin2.54.52,474,49635%
Wyoming2.85.4241,18034%