When people talk about household stress, the “poverty line” often shows up. But many households under pressure are not officially “in poverty”.
That’s where the ALICE framework is useful.
What ALICE means
ALICE stands for:
Asset Limited, Income Constrained, Employed
In other words: people who are working, but still have thin buffers and tight budgets.
Why this matters
Two households can have the same income and very different fragility because:
- housing costs differ by county,
- childcare and healthcare needs differ,
- debt service differs,
- insurance costs differ.
So a single national poverty threshold often misses the lived reality of cost-of-living pressure.
How this connects to Kill Line
Kill Line thinking is about a threshold where the system becomes unstable:
- cash flow can’t absorb shocks,
- small emergencies become cascading failures.
ALICE provides a structured way to estimate “survival budgets” and “stability budgets” that can anchor those thresholds.
What to do with this insight
If you want a practical takeaway:
- don’t compare yourself to a single national number,
- compare your budget to your local cost structure,
- and build buffer around the highest-risk shocks (job loss, medical, housing).
Primary sources
- UnitedForALICE overview: https://www.unitedforalice.org/alice
- Methodology: https://www.unitedforalice.org/methodology
Disclaimer
This is educational content only and not financial, legal, medical, or investment advice.