Median Household Income

November 27, 2009

Household income is not to be confused with the income of the family or individual person. Median income is used to get data from smaller geographical areas. Median means taking the middle value of all the selected values when they are arranged in descending order. If there are two middle values then the average of the two values will be taken into consideration for further calculations.

Statisticians consider median income value is more realistic and appropriate than the average household value. The median income is used and calculated to provide data about various geographical areas. It helps in dividing the households into two equal segments. The first half of the households earn less income than the median house hold income and the other half earn more income than the median household income.
So the median income amount divides the household income into two groups, one group having greater household income compared to median income and the other group having lower household income than that of the median income.

CALCULATING MEDIAN FAMILY INCOME

The following are the steps involved in calculating median family income.

1. You should check the area definitions for that particular state. Area definitions will be present in separate document along with MFI (Median Family Income) data. Even if the county you are looking is not listed, you can find that listed and identified in MSA (Metropolitan Statistical Area).

2. You can access state wise MFI data. Then you can locate the county or MSA that is equivalent to county. The amount you acquire is MFI data for a four person family household. The value is the percentages of MFI for that number of persons in families or households.

3. You should determine the number of persons in a family for calculating MFI. You should use the MFI value for a four person family household as a standard or base figure taken as 100 percent.

4. Accordingly you should adjust from the base figure to calculate the median family income for a particular family or household. For each decreasing member number of a family you should adjust 10 percent from the base figure. This is the method to be followed for calculating MFI for family households of less than 4 numbers. If you have to calculate MFI for households that have 5 or more members, then you have to increase 8 percent from the base figure.

TIPS

If you are applying for section 8 family household assistance, then you should meet the standards prescribed for low income in that specific county.

Most states require you to be a resident of that particular state for at least 6 months before you qualify for housing assistance. You should check and go through the rules for that particular state that govern the assistance programs.

Once a person is clear and satisfies all the laws relating to median household programs, then he or she can avail all the benefits related to that particular program for the benefit of all the members of the family household.

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Written by Uncle Sam · Filed Under Income 

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