Welfare of households; key figures

Table explanation

Description topics

Number of households

Number of private households with a known income on January 1st of the reporting year.

A private household is a collection of one or more people who share the same living space and provide in their own everyday needs in a private, non-commercial way.

Mean disposable income

Mean disposable income per household.

The disposable income is defined as the gross income minus current transfers paid (like alimony payments to an ex-partner), income insurance premiums, health insurance premiums and tax on income and wealth. Gross income is the sum of income from labour, income from self-employment, income from property, payments from the government and other receipts (like alimony payments by an ex-partner).

Mean equivalised income

Mean equivalised disposable income per household.

The equivalised income is the disposable income corrected for differences in household size and composition. The correction factor used reflects the advantages of scale of households with two or more members. The single person household is used as the reference household. The equivalised income is a measure of the prosperity of (members of) a household.

Mean expenditures

The mean yearly amount spent by households.

Households spend money on goods and services to fulfil their needs. Such expenditures may have been done in the Netherlands as well as abroad.

Median wealth

Ranking households according to their wealth, the median is equal to the wealth of the central household. Half of the households possess more wealth, the other half has less.

Wealth equals assets minus debts. Assets are financial assets (bank and saving credits and securities), real estate and enterprise capital. Debts are amongst other things mortgage debt and consumptive loans.

Households in poverty

The number of households living in poverty, as a percentage of the total number of households per category.

The poverty line is based on basic necessities. If, after paying fixed costs for housing, energy, and health insurance, there is insufficient money left for other necessities, a household—and its members—are considered poor. The poverty line for a household depends on the type of household. The more people in a household, the more money is needed to live and participate in society. The required amounts are determined by the Nibud (National Institute for Family Finance Information) for 35 different types of households. In addition to money for housing, energy, insurance, clothing, and daily groceries, this also includes things like a telephone, internet access, and social activities.

To determine whether a household is living in poverty, not only income but also the household's capital buffer (savings or other available assets) is considered. A household is not considered poor if its capital buffer can cover expenses at the poverty line level for at least twelve months.

Income inequality

The Gini coefficient is a common measure for inequality. The value of the Gini coefficient varies between 0 (everyone has the same income) and 1 (one household has all the income, the others have none).
The Gini coefficient is calculated as the half of the mean income difference between households, divided by the mean income. In case of negative incomes, the Gini coefficient is normalized. The coefficient is based on the standardized disposable income.

Wealth inequality

The Gini coefficient is a common measure for inequality. The value of the Gini coefficient varies between 0 (everyone has the same income) and 1 (one household has all the income, the others have none).
The Gini coefficient is calculated as the half of the mean wealth difference between households, divided by the mean wealth. In case of negative wealth, the Gini coefficient is normalized.