Living on a Low Income: Guide to Resources & Support

Living on a low income is a problem that approximately 37.2 million Americans face. While the definition of low income may vary per person and location, the Federal Poverty Level (FPL) guidelines may help determine whether an individual is considered a low-income earner.

Low-income earners face various challenges. But with the right resources and financial planning, you can ensure that you and your family still meet their basic needs, such as health care, housing, nutrition, transportation and education.

The idea of low income may vary per state. But generally, an individual is considered a low-income earner if their household income is less than double the FPL.

FPL guidelines are released annually by the Department of Health and Human Services. The guidelines simplify income limits to help different agencies determine who may be eligible for government programs. Knowing this information is essential as it can help you identify which benefits you may be eligible to receive.

The FPL measures family income. Inflation and the most recent completed year are reflected in the price changes. For instance, the 2022 poverty guidelines are based on price changes through 2021.

For 48 states and Washington, D.C., there’s one set of FPL figures. Meanwhile, Alaska and Hawaii have separate sets of figures. The separate guidelines for the two states are due to the Office of Economic Opportunity's administrative practices from 1966–1970.

The table below shows the latest FPL guidelines.

For households in the 48 states and Washington, D.C. with more than eight members, add $4,720 per additional person. The amounts to add for each additional person in Alaska and Hawaii are $5,900 and $5,430, respectively.

Many federal programs use a certain percentage of the FPL as the basis for eligibility. For instance, adults with household modified adjusted gross income (MAGI) less than 138% of the FPL may qualify for Medicaid in many states. That means if an individual earns below $18,754.20 ($13,590 x 138%), they’ll be eligible for Medicaid.

You can check the limits by visiting specific programs’ websites. Depending on the state, percentage limits may also vary.

You may also use the table below to get an idea what the percentage limits some programs have set. The check mark indicates what percentage of FPL qualifies a household for specific benefits.

Living below your means — due to low income or through unemployment — can be challenging. It could mean sacrificing certain items other people consider essential, such as health care, housing, nutrition, transportation and education.

Fortunately, there are various programs, aids and subsidies that cater to low-income earners. Below are some of the resources you may find beneficial.

Ensuring that you’re healthy is essential regardless of your income. Failure to meet this basic need can cause a health crisis, which can lead to huge expenses. Proper diet, exercise and getting regular check-ups can help. But if these aren’t enough, you may have to look for programs suitable for the type of care you or your family members need.

The right coverage can help you get proper physical treatment. Finding the most affordable health insurance is a must for low-cost income earners. That’s especially true if an employer-sponsored policy isn’t an option.

In most cases, the best health care assistance is applying for a government-sponsored benefit such as alternative health insurance programs, Medicare and Medicaid.

• Children’s Health Insurance Program (CHIP): CHIP provides health insurance benefits to children. Households meeting the income eligibility limits are entitled to receive free health insurance for children. Any parent, legal guardian or grandparent can apply on behalf of a child (including teenage children). State rules on CHIP implementation may vary.
• Medicare Savings Programs: Americans who have resided in the U.S. for five or more years qualify for Medicare when they turn 65. Younger people with certain diseases or disabilities may also qualify. Benefits may include Medicare premium payments, hospital insurance, medical insurance, deductibles, copayments and coinsurance depending on the type of program you qualified for.
• Medicaid: This program is the largest health coverage source in the U.S. and is a joint federal and state effort. Medicaid provides coverage to low-income households, qualified pregnant women, children and Supplemental Security Income (SSI) recipients. Eligibility and coverage may vary per state.

For low-income families, the stigma associated with mental illness can be compounded by a lack of resources. That said, Medicaid, Medicare, and CHIP all pay for mental health services, including counseling. Additionally, there are nonprofit organizations offering resources, tools and programs to help individuals learn more about and find ways to deal with mental health issues.

• Mental Health America (MHA): An education and outreach nonprofit offering programs to help people better understand mental health issues. It has more than 200 affiliates that offer services and resources to communities. You can use the organization’s Affiliate Resource Center to find an affiliate in your area.
• National Alliance on Mental Illness (NAMI): NAMI is an organization offering resources to help people with mental health issues. Join online discussion groups, access reports and publications, find support groups or local NAMI affiliates and learn about assistance programs for prescription medications.
• Substance Abuse and Mental Health Services Administration (SAMHSA): Some people may need treatment for their mental health illnesses. If this is the case for you, SAMHSA’s Behavioral Health Treatment Services Locator can help you find the nearest state-funded or nonprofit facilities.

According to the Centers for Disease Control and Prevention (CDC), 61 million adults in the country live with a disability. That means one in four U.S. adults has a type of disability.

Many people living with a disability or with a person with a disability know how costly medical bills can be. For low-income earners, dealing with the expenses is much more difficult. Finding assistance programs can help.

• Achieving a Better Life Experience (ABLE): The ABLE Act allows individuals with disabilities to maintain a tax-free savings account, which can cover qualified expenses. To qualify for an ABLE savings account, you should be eligible for SSI and childhood disability benefits (CDB), disability insurance benefits (DIB) or disabled widow/widower benefits (DWB) based on a qualifying disability that began before the age of 26. A disability certification is also necessary.
• Disability Benefits: The Social Security Administration offers Social Security Disability Insurance (SSDI) and SSI programs. Both pay benefits to eligible individuals. However, the SSDI pays benefits if the person is insured. Meanwhile, the SSI benefits are for adults and children with disabilities with limited income and resources. To qualify, you’ll need to meet medical and non-medical requirements.
• VA Disability Claim: Veterans suffering from an illness or injury affecting their mind or body may be eligible for a disability claim. If your illness or injury was caused by or has gotten worse because of your active military service, you may receive financial compensation and other benefits.

Shelter is a basic need, but finding a comfortable place to live can be a struggle if you have limited income. Missing even a few rent payments can lead to eviction. Finding government agencies or nonprofit organizations offering housing assistance programs will help prevent this situation.

Public housing is available to eligible low-income families through government agencies. Low-income individuals, people with disabilities and seniors may also qualify for affordable rental housing. Another option is to get a housing choice voucher.

• Public Housing Agency (PHA): The application process for public housing assistance programs vary per state. You may check eligibility requirements. Typically, the applicant must meet the annual gross income limit and must be a senior citizen, a person with a disability or a family. A U.S. citizenship or an eligible immigration status is also necessary.
• Affordable Rental Housing: The U.S. Department of Housing and Urban Development (HUD) helps low-income individuals, people with disabilities and seniors to get affordable rental housing. Under this program, the HUD pays states and building owners to ensure low fees for renters.
• Housing Choice Vouchers: People with limited income who want to rent a house from the private market may try housing choice vouchers. This program is for low-income families, people with disabilities and the elderly. If you qualify, you can choose a house suitable for your needs. The PHA will pay the landlord for you. That said, the property owner should agree to rent the unit under this program.

There are many nonprofits offering housing assistance to low-income individuals. Before applying, make sure you check eligibility requirements and program details. Below is a list of a few organizations working to help people become homeowners even with a limited income.

• Habitat for Humanity: This global organization focuses on helping low-income families own decent and comfortable homes. It serves all states in the U.S. Generally, Habitat for Humanity selects families based on the level of need and ability to pay off mortgages through a payment plan.
• Catholic Charities USA: One of the advocacies of this organization is access to affordable housing. It offers emergency shelters to people in need. Members of vulnerable populations may also get long-term assistance.
• Modest Needs Foundation: This nonprofit caters to low-income individuals and families who need short-term financial assistance but don’t qualify for conventional government assistance. Beneficiaries of Modest needs don’t receive cash directly. Instead, the organization directly remits the payment to landlords or creditors. Modest Needs offers grants for various purposes, including monthly rental or mortgage payments.

Finding affordable housing can be challenging. If you don’t know where to start, you can begin your search online. Below are a few tools and resources you can easily access.

• HUD Resource Locator: This interactive map helps you locate the public housing authority serving your area. You can get their address and contact information.
• Affordable Housing and Rental Resources: You can look for online search tools that help find affordable housing in a specific area. Examples of these include AptFinder.org, GeorgiaHousingSearch.org and MassAccess.
• State or City Registry: Some states and cities post an updated list of affordable rental and housing units, as well as housing agencies. The State of California, Chicago and Miami are among these.

Eating well on a budget might sound too good to be true, but it's a goal that's within reach. Government-run programs, community resources and even apps can help low-income individuals and families get the nutrition they need.

Many people think that a limited income also limits their food choices, making it hard to ensure nutritious meals. But with planning and research, you can come up with a healthy menu without breaking the bank. Listed below are some tools you can use.

• USDA MyPlate: Build meals that include the five food groups, find cost-saving opportunities, learn how to cook budget-friendly recipes and get a personalized plan.
• Grocery Pal: Plan your meals with the help of the grocery shopping mobile app. Track your grocery inventories, set reminders for expiration dates and get alerts to prevent purchasing duplicate items. You can compare products online to find the lowest prices. The app also informs you about weekly sales at local supermarkets and discount stores.
• Price Cruncher Pro: Stay on budget and save money by finding the best prices. This app allows you to compare the prices of grocery items from various stores.

There are different government programs aimed at helping individuals access nutritious meals and snacks. Depending on the program, qualified individuals may be eligible for reimbursements or meals.

• Supplemental Nutrition Assistance Program (SNAP): SNAP is a federal program often called the "food stamps" program. It provides a supplemental budget to eligible women and families to help them purchase food from major grocery stores, restaurants and farmer's markets accepting SNAP cards as payment.
• Special Supplemental Nutrition Program for Women, Infants and Children (WIC): WIC is a federal program serving low-income pregnant women or mothers of children up to age five, offering supplemental food, nutrition-centered education and referrals for healthcare services.
• USDA Child and Adult Care Food Program (CACFP): This federal program reimbursed eligible families for nutritious food. Low-income individuals may be eligible for CACFP if they’re enrolled at child and adult daycare centers. Children participating in afterschool care programs or living in emergency shelters, seniors and people with disabilities enrolled in participating facilities may also be served meals.

Various organizations help low-income families get the nutrition they need by organizing food pantries. Many churches and religious groups also serve free meals to people in need on a first-come, first-served basis. The following are some examples of nonprofits having food drives across the country.

• Family Promise: An organization helping families in need of temporary shelter, utility support, rental assistance and transportation assistance. It also organizes community food pantries.
• Feeding America: This organization conducts food assistance programs in various locations, including senior centers and schools. It also has mobile pantries that bring free groceries to communities. Other food drives it organizes include drive-thru food pantries, summer meal programs, school pantry programs, senior food programs, the BackPack program and Kids Cafe.
• Salvation Army: It provides food to help low-income individuals and families. The organization has food pantries that provide fresh produce, healthy frozen food and canned goods to communities experiencing food insecurity. It also has meal programs conducted in residential facilities and shelters.
• FoodPantries.org: This website helps you find food pantries in your area and know their schedules. Simply click on the state and city where you live.

Transportation is necessary to move people and goods from one point to another efficiently. However, it also comes with expenses. Aside from the money you need to purchase a vehicle, you also need to consider finding affordable auto insurance and maintenance expenses.

To help improve access to cars and transportation, many organizations and government programs offer assistance and grants to low-income individuals and families.

It can be expensive to buy a car. But if you think it’ll help you save money in the long run, you can apply for grants and aids, including the following:

• Grants.gov: This is a database listing different federal grants. Select “Individuals” and “Transportation” to find all grants that may be available to you.
• Vehicles for Change: This program offers low-interest loans to help qualified low-income families own cars. There’s a maximum income level required to ensure that the vehicles it offers are reserved for low-income families. Vehicles for Change is also behind Freedom Wheels, which is a used car outlet offering donated cars at a low cost. That said, Vehicles for Change only serves Maryland and Virginia.
• Working Cars for Working Families: The National Consumer Law Center created Working Cars for Working Families to help protect consumers against abusive car sales and financing practices. It also has a database of available car programs in different states.

Auto insurance protects you and your family against possible huge expenses due to unexpected incidents. However, paying for insurance premiums can be challenging if you’re already living on a low income. Additionally, the cost of a policy tends to be higher for people with low credit scores.

The best option for you is to shop around. By comparing auto insurance prices, taking advantage of discounts, or bundling multiple insurance policies you may save a significant amount. It will also ensure that you’re getting enough coverage to protect you financially.

Taking public transportation is an excellent alternative if it’s accessible to you. It can lower your car expenses, especially in terms of insurance, gas and vehicle maintenance.

If you live close to work, consider walking or investing in a bicycle. In doing so, you eliminate your transportation expenses. Consider refurbished bicycles you can get for a small fee or for free. You can visit the Bike Collective Network to start your search.

The IRS allows employers to pay for employees' commuting costs on buses, ferries or trains, as long as the costs are within set monthly limits. If your employer offers transportation subsidies, you may have to elect to deduct a certain amount from your pre-tax income and submit proof of transit for reimbursement.

Just thinking about the costs associated with higher education — whether it's for you, a spouse or a child — can be overwhelming enough to squash dreams of college.] Fortunately, there are various scholarships, grants and financial aid that can help low-income students pay for college.

• Federal Application for Federal Student Aid (FAFSA): Check deadlines, requirements and the amount of aid you’re eligible to receive. Determine the best repayment plan for you.
• Scholarships: Different kinds of scholarships are available for students. Some are merit-based, while others are based on financial need. You can find federal scholarships or ask your school’s financial aid office.
• Foundations and Organizations: Many nonprofits, foundations, organizations and corporations offer scholarship programs to deserving students. One example is the Jeannette Rankin Foundation (JRF), which explicitly helps low-income women 35 and older who are pursuing their first bachelor’s, technical college degree or post-secondary diploma.

Depending on your income and family circumstances, you may be eligible for certain tax credits. You can check this with the IRS. Visit their website to learn more about the different tax credits. Here are some examples to give you an idea about possible credits you may be eligible to receive.

• Child and Dependent Care Credit: Generally, families have to pay a portion of childcare costs, not unlike co-pays for medical insurance. But the IRS provides credit for childcare expenses. Your tax credit will be based on your income and the percentage of childcare expenses.
• Earned Income Tax Credit (EITC): Low- to moderate-income earners may qualify for EITC. The amount of the credit varies depending on your family composition (individual, married, head of household) and income.
• Health Coverage Tax Credit: For qualifying individuals, this IRS tax credit pays for 72.5% of their health insurance premiums (as long as those health insurance plans are also qualifying plans). This can make health insurance significantly more affordable. If you're wondering whether you qualify, call the IRS at (800)-829-1040.
• Mortgage Interest Tax Credit: If you own your home, you may be able to deduct the interest you pay on your mortgage loan from your annual taxable income.
• Saver's Tax Credit: If you make eligible contributions to a qualifying retirement savings account, you may be able to deduct from your taxes if you meet specific requirements.

A solid budgeting strategy can help with proper money management. However, many Americans don’t know how much money they spend. Knowing what expenses to focus on can help you learn to prioritize expenditures and ensure that you’re able to meet your basic needs even with a tight budget.

Below are a few tips to help low-income earners create a budget plan.

Cutting your household expenses can help you save money. However, you need to determine first which areas of your spending you can reduce. You can do this by categorizing your expenses.

Generally, there are two types of household expenses — fixed and variable. Fixed expenses are those that remain the same, such as your monthly rent, mortgage, insurance and utility bills. Meanwhile, variable expenses are costs that change based on quantity or price fluctuations like food, entertainment and travel expenses.

Below are some of the most common fixed expenses and tips on how you can save money.

The table below enumerates some of the variable expenses most households have and provides simple tips to help you reduce your expenses.

Investing can help you grow your money. However, it can be risky, especially for low-income earners. That’s why it’s important to find the right investment product. Start your investment journey by consulting with a financial advisor. They can help you evaluate your risk aversion and create a suitable investment portfolio.

Understanding financial components can help you maximize your limited income. However, you should also have the skills to make wise financial decisions. Being mindful of your spending and adopting healthy financial habits, such as preventing impulse buying and reducing credit card spending, can positively impact your finances.

Finding support services can help low-income earners make better financial decisions. The following resources can help you manage your expenses and ensure you’re covering your necessities and more.

Financial Assistance

• Administration for Community Living (ACL): Find community-based services for older adults and people with disabilities in need of support. The ACL has various programs, including the Aging and Disability Resource Centers Program, Centers for Independent Living and Eldercare Locator. Depending on the program, eligible individuals may get food, transportation, education or financial assistance.
• Benefits.gov: Look for a financial assistance program in your state using the search tool or browse through the directory of federal and state programs.
• Federal Employee Education & Assistance Fund (FEEA): Get emergency loans or find merit-based scholarships offered to federal public servants and eligible families.
• Supplemental Security Income Program: Learn about the SSI program and determine how it can help you meet your basic needs.
• USA.gov: Know what types of government benefits you may get. Find financial assistance programs, food benefits and other federal and state programs.

Financial Management

• Consumers Cooperative Federal Credit Union: Access different government resources and channels, including financial calculators, money management resources and financial planning tips.
• Consumer Financial Protection Bureau: Choose various education tools listed in CFPB’s directory. Check guides to help you make better financial decisions.
• Internal Revenue Service (IRS): Learn about tax regulations. Find out how gift taxes and tax credits work.
• Investor.gov: Access different financial tools and calculators, understand other investment products and learn about associated fees.
• FINRA: Start your investment journey with the help of FINRA’s fund analyzer. You can compare and understand fund costs.
• National Financial Educators Council: Find resources and services that will help you become more financially literate. The National Financial Educators Council focuses on teaching financial literacy to low-income families.
• National Foundation for Credit Counseling: Get in touch with an NFCC Certified Financial Counselor and learn about financial planning, wealth building and debt management.
• U.S. Department of Labor: Learn about retirement plans, what you need to do, the fees you need to take note of and the benefits you may receive.

Treatments and Facilities

• Anxiety and Depression Association of America (ADAA): Find resources about anxiety disorder and depression and support groups in your area.
• Community Mental Health Centers: Use the Health Resource & Services Administration's (HRSA) search tool to find mental health centers near you.
• Consumer Credit Counseling Services (CCCS): Find financial classes, workshops and other resources like calculators and guides.
• Financial Therapy Association: Find a financial therapy practitioner who can help you deal with financial stress.