An average family of four living in Indiana, two working parents, a toddler, and a baby, how much do you think it costs to afford daily costs? Groceries, housing, childcare, and transportation costs. This family is struggling to get by. There are no vacations or savings accounts, no dinners out, simply surviving.
According to the newest State of ALICE report, released just last month by United for ALICE and Indiana United Ways, the answer is $74,028 a year. That may sound like enough, but when the costs are broken down, many families in our community and across our state are struggling.
Why Does $74,028 A Year Matter
The $74,028 figure comes from the ALICE Household Survival Budget, which calculates the bare-minimum cost of six essentials: housing, child care, food, transportation, health care, and technology, plus taxes and a small miscellaneous cushion.
The housing line assumes a modest apartment at fair market rent, with utilities included. No one in this budget is house hunting in a hot market. The child care line assumes registered home-based care, often the lower-cost option, not a private center. Food is a basic grocery budget. Technology means basic internet and a phone plan, which is simply the price of admission to the modern workforce.
Now consider what’s not included in $74,028: No savings. No emergency fund. No retirement contribution. No college fund. No, not even the cost of replacing the car when it finally gives out. No birthday presents, no school field trips, no margin for error beyond a thin miscellaneous line that a single dental bill can erase. This reality puts so many Hoosier families at risk of becoming unhoused while working full-time jobs.
The Math Problem
So how does that survival budget compare with what Hoosier families actually earn? This is where the story stops being about numbers and starts being about neighbors.
The Federal Poverty Level for a family of four is $31,200, less than half of the $ 74,028 survival budget. Most assistance programs use the poverty line to determine eligibility for support. A family can be more than $40,000 short of covering the basics and still, on paper, be told they’re doing fine. For a single adult such as a young adult starting out or an older adult on a fixed income, or someone with a disability, the gap is glaring: survival costs $28,764, while the poverty line sits at $15,060, barely half of what it takes to get by.
To complicate matters, let’s consider that Indiana’s minimum wage is $7.25 an hour and hasn’t moved since 2009. Two parents working full-time at minimum wage, 80 hours a week of work between them, every week of the year, bring home $30,160 combined. Two working adults cannot make a living on minimum-wage jobs, putting their income below the federal poverty line.
When we go back to our family of four, our number of $74,028 is higher than Indiana’s median household income of $71,958. The average Indiana household earns less than what a family of four needs to survive.
The cost of essentials has been outpacing both wages and inflation for nearly two decades, according to the most recent ALICE report: between 2007 and 2024, the cost of Indiana’s basic necessities rose by more than 61%, compared with 52% for overall inflation. When the cost of survival outpaces paychecks, the gap doesn’t discriminate. Today, 38% of Indiana households, more than one million families, can’t consistently afford the basics.
This Is Where Housing Becomes Unstable
A budget with zero cushion means there’s no such thing as a small emergency. A car repair, an unexpected prescription with a high price tag, a household repair that the landlord won’t cover.
In a survival budget, every unexpected expense competes directly with rent. The transmission repair. The reduced shift when the store cuts hours. The ER copay for a preschooler’s ear infection at 2 a.m. For a family earning $74,028 or less, these aren’t inconveniences; they’re eroding the illusion of stability.
How does this issue compound for our family of four? A missed shift in March becomes a partial rent payment in April. April’s shortfall becomes a late fee in May. By June, the family is choosing between catching up on rent and keeping the lights on. By August, there’s an eviction filing, and a family that did everything right is suddenly at risk of losing everything. Housing insecurity doesn’t begin with an eviction notice. It begins months earlier, in a budget that was never going to balance.
When the Math Doesn’t Add Up
You can’t budget your way out of this math problem. Families can’t coupon-clip their way across a $40,000 gap. The structural answer is housing that working families can actually afford, which is exactly what we’re building at Karwick Village. As we see development in our county, housing that meets this need will be crucial for the stability and health of our community.
We invite you to follow along in this series as we show how affordable housing is key to economic stability and key to solving the issue of homelessness, both in solution and prevention.
