what is household income 
the term household income generally refers to the combined gross income of all members of a household above a specified age household income includes every member of a family who lives under the same roof including spouses and their dependents the incomes of everyone count even if they aren t all used to support the household household income also includes anyone living in that home even if they re not related household income is an important risk measure used by lenders for underwriting loans and is a useful economic indicator of an area s standard of living understanding household incomehousehold income is defined as the total gross income before taxes received within a 12 month period by all members of a household above a specified age the census bureau notes this threshold as 15 and older it includes but is not limited to wages salaries self employment earnings social security benefits pensions retirement income investment income welfare payments and income from other sources the definition of household income and its components varies depending on the context the term may be defined in law or regulation or may be determined by researchers or authors as an amount that includes or excludes specific items of income here are some examples household income provides a picture of the standard of living of various households it is also a good barometer of the local and national economies this figure can also help lenders determine the potential risk of lending to a potential borrower for instance households with a lower income are more likely to default than those with higher earnings special considerationsthe per capita gross domestic product gdp of a country should typically increase along with the median household income in recent years a divergence has been seen between these figures in the united states in turn this has led to discussions about referencing median household income as a better indicator of economic well being than gdp research shows that the average household income has risen since 1970 the largest increases are in households in upper income brackets household income vs family income vs per capita incomehousehold income is one of three commonly cited measures of individual wealth the other two family income and per capita income take different approaches to measure how well people in a given area are doing financially here s how they stack up against one another average household income vs median household incomehousehold income is the total income of all members of a household aged 15 and older whether they are related or not to determine the average household income all household incomes are added up and divided by the total number of households by contrast the median household income is the income level earned by a household in a designated demographic area where half the households earn more and half earn less median income is seen as a more accurate measure of how americans are actually doing financially than average household income that s because the average household income can be skewed by the inclusion of a few multi millionaires or even billionaires which would drag the average much higher than reality the census bureau counts households with no income in its calculation when it determines median household income in the united states however some other income analyses particularly ones focusing on various average income statistics use only positive income amounts 