Primerica Household Budget Index™ (HBI™)

The Primerica Household Budget Index™ (HBI™) metric is a monthly index that measures middle-income families' purchasing power for necessities such as food, gas, utilities and health care.

The monthly index assesses whether families can get ahead financially or if they may fall behind based on the affordability of everyday necessities needed to manage their homes and changes in their earned income.

Interpreting the HBI™ Chart

• HBI™ = 100%: Households are neither better nor worse off today than they were in January 2019.

• HBI™ > 100%: Households may have extra money left over at the end of the month that can be applied to things like entertainment, extra savings or debt reduction. 

• HBI™ < 100%: Household has less money left after paying for necessities and may have to reduce overall real spending to levels below budget, reduce savings (smaller additions or outright withdrawals), or increase debt to cover expenses.

Read the latest press release to learn how middle-income households are faring in the current economy.

Why develop the Primerica Household Budget Index™ (HBI™)?

Primerica created the monthly HBI™ metric to fill the need for a reliable and consistent measure to track the purchasing power of middle-income families with incomes between $30,000 to $130,000. Understanding middle-income families' purchasing power is important because it directly impacts their ability to save money vs. increase debt.

When families make monthly budgets, they plan for how much money they will need for groceries and to put gas in their cars. Unfortunately, the prices of these and other necessities can change quickly – even from one day to the next – meaning how much a family can afford can also shift. This volatility disproportionately impacts middle-income families with tight budgets.

What does the Primerica Household Budget Index™ (HBI™) measure?

The HBI™ metric measures how the current economic climate affects families' ability to afford necessities, including food, gas, utilities and health care. The cost of these items can vary month-to-month because of economic and other events, such as global trade issues, weather issues, animal and plant disease, pandemics, and international conflicts. These factors create supply and demand imbalances, which can lead to big price changes. 

The index also takes earned income into account because tracking differences in inflation and wage growth is key to measuring the strength of household budgets. 

What does the Primerica Household Budget Index™ (HBI™) not measure?

The HBI™ metric is not meant to measure the overall financial stability of middle-income households. Instead, the index assesses whether these households can get ahead financially, or whether they are falling further behind based on the affordability of everyday necessities.

How is the Consumer Price Index (CPI) different than the Primerica Household Budget Index™ (HBI™)?

The Consumer Price Index (CPI), released monthly by the Bureau of Labor Statistics, provides an excellent measure of inflation as a whole but does not offer a clear picture of how this change in prices impacts middle-income Americans. 

The CPI includes expenses middle-income households can plan for, such as buying a car or a dishwasher, and it includes the purchasing patterns of households of all income ranges. The Primerica Household Budget Index™ (HBI™) metric removes these infrequently purchased or predictable expense items and focuses solely on the purchasing patterns of middle-income households, defined as those with incomes of $30,000-$130,000.

Primerica Household Budget Index™ (HBI™) Resources

• HBI™ Q&A.pdf

• December 2023: Special Report: Perception vs. Reality: Examining Middle-Income Households' Financial Outlook Heading into 2024 

• December 2023: Video: Perception vs. Reality: A Financial Outlook of Middle-Income Households in 2024

• October 2023: Video: Why the Purchasing Power of Middle-Income Families Matters 

Primerica Household Budget Index™ (HBI™) Press Releases

Primerica Household Budget Index™ (HBI™) in the Media

The HBI™ metric has become a reliable source of data and insight for reporters on middle-income families. Below is a small sampling of this media coverage:

• Feb. 16, 2024 | FoxBusiness.com | Americans appear more pessimistic about their financial circumstances: Glenn Williams

• Nov. 22, 2023 | The Atlanta Journal-Constitution | Opinion: Insights into pocketbook issues

• Oct. 4, 2023 | GoBankingRates.com | Report: Rising Gas Prices Are Hurting the Middle Class the Most

• Sep. 2, 2023 | Yahoo! Finance | The middle class is getting its spending power back – but progress is 'fragile'

• Aug. 23, 2023 | CNBC | Primerica's CEO on measuring middle-income purchasing power through the Household Budget Index™

The information contained herein is for information purposes only. The Household Budget Index™ (HBI™) is derived from data believed to be reliable, but we cannot warrant its accuracy or completeness. Such information is subject to change and is not intended to influence investment decisions nor constitute investment advice. PRIMERICA and the Primerica Logo are trademarks of Primerica, Inc., registered in the U.S. and Canada. Household Budget Index™, HBI™ and the HBI™ Logo are trademarks of Primerica, Inc. All rights are reserved.