Household income hits record, but lower earners lose ground

In 2025, U.S. household income reached a record high, with real median income increasing by 2.6% to $87,460. Median post-tax income also rose by 3.1% to $76,060. However, the benefits of this economic growth were not evenly distributed, as the lowest earners barely shared in the gains. The official poverty rate dropped to 10.2%, the lowest since 2013, but millions of people still struggled financially.

Medical costs and uneven income gains continued to squeeze the lowest earners. Despite the overall gains, the top fifth of households captured 52.4% of all household income, while the bottom fifth reported earning just 3%. The data, which largely reflects the economy before major safety-net reductions under President Trump's Big Beautiful Bill, highlights significant racial income gaps, with Asian American households having the highest median income at $126,300, compared to $91,930 for white households and $59,980 for Black American households.