U.S. household incomes rise and poverty falls as Census Bureau data point to 2025 gains

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US household incomes and poverty 2025

Highlights

Real median household income increased 2.6% to $87,460 in 2025, while the poverty rate fell to 10.2%, according to Census Bureau data.
Households with children and working-age families saw the largest gains, but a poverty measure including social safety net effects remained unchanged in 2025.
Despite income gains, the average 30-year mortgage rate surpassed 7%, consumer prices rose 3.4% in August, and SNAP spending is projected to decline by $211 billion through 2035 under new policy.

2025 income and poverty data

As reported by CNBC, citing the Census Bureau, real median household income rises 2.6% to $87,460 in 2025, while the poverty rate falls by nearly half a percentage point to 10.2%. The poverty threshold for a family of four stands at $32,970 for last year.

Treasury Secretary Scott Bessent points to the data during testimony before a House committee on the economy, calling the figures "several inconvenient facts" for the Trump administration's political opponents. The agency does not identify specific causes for the improvement, but the underlying data suggest a stronger labor market helps lift household income.

The decline in poverty appears concentrated among families with children and working-age households rather than retirees. A separate poverty measure that reflects gains from the social safety net is unchanged in 2025, indicating some support for vulnerable households does not improve alongside the headline poverty rate.

Policy and inflation risks ahead

Lawmakers debate the broader economic picture as Democrats criticize Bessent over high gasoline prices and other household strains. The average rate for a new 30-year fixed-rate mortgage rises above 7% last week, while consumer prices increase 3.4% in August from a year earlier, based on the consumer price index.

The Census data cover 2025 and do not reflect more recent inflation developments or other economic shifts since the Iran war starts. Pressure could also build as the Republican tax-and-policy law enacted in the summer of 2025 is phased in, because the measure known as the "Big, Beautiful Bill" cuts taxes for some working families but partly offsets that by tightening parts of programs for low-income Americans.

The Congressional Budget Office projects SNAP spending falls by $211 billion through 2035 because fewer people qualify for nutrition assistance under the law. At the same time, the Fed is close to raising its benchmark short-term interest rate, with Chair Kevin Warsh signaling concern about inflation ahead of the central bank's decision due Wednesday afternoon.

Our earlier coverage of Scott Bessent’s House testimony outlined how lawmakers were expected to use the hearing to press the Treasury secretary on domestic affordability issues, including gasoline prices, interest rates, and borrowing costs, alongside the administration’s broader economic agenda. We also noted that renewed Iran-related tensions were pushing oil above $100 a barrel, adding to inflation pressure, while rising Treasury yields and a growing debt load were keeping attention on the outlook for tighter Fed policy and higher household financing costs.

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