Income inequality is the widening gap between the rich and the poor, and specifically the growing group of people who are getting closer and closer to the poverty line. As of 2025, the gap has increased to the point that those who used to be solidly middle class are finding themselves on the low end of that metric and those who were already on the low end are finding themselves among the working poor (those who have jobs but still don’t make enough to cover basic necessities like food, housing, and healthcare). Although it’s been in the news enough recently that it is becoming part of the national consciousness, I want to connect some specific dots here so we can see why the wealth gap is important in the context of education.
Income inequality is frequently tied to geographic location. In recent years, some areas of the country have become richer and others have become much, much poorer. The Conversation published a fascinating study that included a map of of the US with household median income figures for various geographic locations. This map allows us to see the distribution of wealth across the states. Zoomed out, there’s a perhaps-not-unexpected difference between urban and rural areas. For example, Minneapolis-St. Paul looks pretty prosperous compared to the more rural areas of Minnesota. This is true for many states: rural areas generally earn less income than urban. Urban areas, however, are not monolithic prosperity zones. Zooming in, we can see very different income levels across urban areas. In Minneapolis-St. Paul, there is a sharp east-west divide between the two, with the eastern metro less prosperous than the western. The city of Minneapolis itself (i.e. Hennepin County), is broken in to multiple pieces with substantial differences between different parts of the city. East Hennepin County’s median income is $77,900, Central Hennepin County’s is $34,900, North Hennepin County’s is $129,800 and Southwest Hennepin County’s is a whopping $351,100 (all numbers rounded). There are similar patterns in Denver, Houston, Chicago — really every large city.* As a measure of income, what “richest” means is also not the same from region to region. For example, in some parts of California, the richest people are 7 times wealthier than the average while in parts of Iowa, they are only 3 times wealthier. None of this is that surprising; what might be surprising is the degree of difference between proximate areas.
What is hard to see in these differences in income across the U.S.is the growing wealth gap. Wealth is different from income. It refers to the total value of a household’s assets minus its debts. In general, a family that owns their home probably has more wealth than one that is renting, though this is dependent on their mortgage and equity. A household with retirement savings and no car or credit card debt might also have more wealth than one with a home but minimal equity, large student loans, and credit card debt. The National Bureau of Economic Research found that the wealth of the bottom 40% hasn’t budged since 1983 (and 40% of Americans is a lot of Americans) but the wealthiest of the wealthy have increased their wealth exponentially in that same timeframe. We haven’t seen this degree of wealth since before the stock market crash of 1929.
Why do these differences matter? Two reasons: school funding and student learning.
Let’s start with school funding and connect another dot or two. Figures like this mean that even if you own your own home, if you live in an area with lower median income your home is likely worth less, which affects not just your overall wealth but also the tax base of your area. That, in turn, affects the amount of money available to fund public schools for your children. We know that per-pupil expenditures vary dramatically between districts, with some spending a lot and others spending very little, but these differences in income also result in districts with dramatically different access to resources. Low income districts have facilities that are older and not maintained as well. The higher concentration of low-income families means students have less access to high quality childcare and lower rates of preschool attendance. The district has more difficulty in attracting qualified, experienced staff and experiences higher rates of staff turnover, often just at the point a teacher becomes highly competent. Often there is a lack of appropriate materials for learning and a lack of access to enrichment programs. It goes on and on, in the worst domino-effect ever. Sometimes we see these problems within districts when the majority of low-income families are concentrated into just a few schools. This results in some schools that are state of the art in wealthier neighborhoods and schools that are not having critical needs met in poorer neighborhoods. Achievement in low income schools is almost always worse than in the schools without high concentrations of Free/Reduced Lunch students.
At a really fundamental level, these differences bring other problems: kids who come to school hungry, kids who aren’t seeing a doctor when they need to, parents who have to choose between working and daycare, parents whose shiftwork prevents them from coming to school for conferences, concerts, Meet the Teacher, etc., and may prevent them from helping their kids with homework. There may be increased homelessness or housing insecurity and often there are parents who can’t take better paying jobs because it jeopardizes their subsidized housing. The day-in-day-out chore of navigating these Catch-22 choices is extremely stressful for parents and kids alike and can lead to other social problems like higher parental incarceration rates, higher spousal/partner violence rates, higher child abuse rates, and more drug and alcohol abuse. This is where the dots connect directly to student learning. In low-income schools, we see a lot of kids for whom basic survival needs are not met or are inconsistently met and this translates to kids whose ability to learn is greatly compromised.* Parents in these situations may also be experiencing stress sufficient to derail higher cognition and that impacts their ability to aid in their children’s education.
Educators need to be aware that there are clear generational patterns in wealth distribution, where those in the lowest tiers are effectively trapped there by all the factors noted above. These factors have far-reaching consequences as children grow up and enter the workforce. Their health outcomes and life expectancy are many times lower than those in higher economic tiers, their ability to attend college and attain a degree is materially compromised,** and the lack of a degree greatly affects potential income over the rest of a person’s life and their ability to accumulate wealth in the form of homeownership, savings, and retirement savings. This is no joke: just earning a college degree increases a person’s life expectancy by 6 years, decreases the likelihood that a person will be unemployed by 50%, and increases potential income by an absolutely enormous amount.*** But completing a degree is considerably more difficult the father down the economic scale you go. This is older data, but as of 2015, researchers calculated the amount of money necessary for students to be able to complete a college degree. That amount was $50,000 in tuition, food, housing, and transportation. The research was a little unclear but this appears to be be money in addition to scholarships and grants that a student needs to support their studies. Whether a family could actually transfer that amount of money to a child in college was, obviously, directly affected by the income level of the family, with lower-income families not able to help at all, low-middle income families providing closer to $30,000, and high income families actually transferring more than was needed — closer to $70,000 in assistance to their children — to ensure they could finish their degrees. Sallie Mae reported in 2024-25 that 74% of all undergraduate families used parent income and savings to help pay for college, but the percentage of parents doing this varied by income level: 87% of families who earn $150,000 or more annually were able to do this versus 64% of families earning less than $50,000 annually. Additionally, the average expenditure for all tiers was $30,000; that’s going to be higher or lower depending on economic status, with poorer families contributing less and wealthy families contributing much more. And costs for food, housing and tuition have only gone up in the last 10 years so that $50,000 number researchers calculated is now much higher. Some research shows that even when wealthy parents don’t contribute to a child’s education, the child is still more likely to complete their degree because their parents’ wealth provides a psychological safety net. Even after college, data show that wealthy parents continue to provide a financial safety net — literally or psychologically — for their children, even into their 30s. Many of these parents assist their children in buying homes; some even assist their grandchildren with college tuition. That’s the power of generational wealth — a power that is simply not available for poor families.
Can education (and educators) fix the wealth gap? Not alone, but that doesn’t mean we don’t have some necessary critical understandings and some strategies we can deploy in our sphere of influence. Consider the following:
- More and more kids are coming to school with needs that directly affect their ability to learn — hunger, homelessness, family disruption, lack of safety, income insecurity, etc. All of these needs are out of the student’s control and directly affect behavior in the classroom. Educators need to have a good understanding of brain research and ways to ensure students’ basic survival needs are met to facilitate better learning. Some ideas can be found here and here. A strong Social-emotional Learning program is also essential to help kids identify and manage how they are feeling and minimize outbursts that might remove them from class.
- Many of these needs are also out of the parents’ control. Research shows that the majority of parents want their children to succeed — it’s important to assume positive intent on their part. It’s also important to be as accommodating, welcoming, and reassuring as possible.
- No one school or even district can solve these problems alone, but recognizing they exist and recognizing that they aren’t a matter of grit or bootstrapping or any other self-help methodology can help schools move from blaming to focusing extra assistance on buildings with high populations of FRL students to provide more and better resources to get struggling students up to grade level as quickly as possible. This means a paradigm shift to acceleration rather than remediation, and interventions with proven track records like targeted tutoring (sometimes called high-impact tutoring) to facilitate this.
Given the critical impact of a college education on future income, beginning in PreK, the goal should be to get as many kids ready for higher education as possible. That preparation should include not just a focus on critical thinking, writing, higher mathematics, and equal access to things like AP and dual-enrollment courses that reduce the total number of credits required for college graduation, but also creative and innovative ways to help students pay for college, including information and assistance establishing educational savings accounts, applying for financial aid and scholarships, and community partnerships and programs that assist with tuition in return for an agreed-upon period of work after graduation (like grow-your-own teacher programs). Steering students toward universities with wrap-around support for low-income students and first-generation college attendees is also of great benefit. The Institute for Research on Poverty has a comprehensive list of policies and programs to help kids get into, pay for, and complete their college education.- Many states have a financial literacy requirement, but for kids in poverty, understanding why and how to save for future emergencies and future goals like higher education and home ownership is critical. This should be coupled with instruction about employment opportunities, specifically which jobs earn the most money. The Brookings Institute reported in 2024 that Pell Grant recipients were often clustered in low-earning majors. Since these students often rely on loans to finish their degrees, they end up with more debt and less ability to pay it back. Understanding how student loans work and Parent Plus loans work^^ — and in particular how they are paid back and for how long — should also be part of this learning.
From a broader, societal standpoint, there are several additional compelling reasons why we should do whatever we can in the education sphere to ameliorate the wealth gap through college degree attainment for as many low-income kids as possible. The list includes: better health outcomes leading to fewer public health care expenditures, fewer people on public benefits, lower loan default rates for all types of loans, higher personal income leading to greater tax revenue which leads to more funds for schools, infrastructure, defense, and so on. It’s time to stop funding education at the bare minimum and start funding it like our future depends on it.
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*In the face of threats to survival — lack of food or housing, lack of safety — cognition essentially stops and the amygdala takes over to ensure the need for food, shelter, and safety is met. This cessation of higher cognition is supported extensively by neuroscience and is referred to as an amygdala hijack or the fight-or-flight response. That response continues until the brain feels safe.
**Data shows that the likelihood of attending and graduating college is strongly correlated with familial wealth; the greater the wealth, the more likely the person is to attend and complete college. A lot of kids from poor families start college but are unable to finish because of a lack of funding.
***According to the Social Security Administration, men with bachelor’s degrees earn approximately $900,000 more in median lifetime earnings than high school graduates. Women with bachelor’s degrees earn $630,000 more. Men with graduate degrees earn $1.5 million more in median lifetime earnings than high school graduates. Women with graduate degrees earn $1.1 million more. Even controlling for socioeconomic variables that affect earning (meaning how ethnicity and skin color impact a person’s ability to find employment), men with bachelor’s degrees earn $655,000 more in median lifetime earnings than high school graduates and women with a bachelor’s degrees would earn $450,000 more. Despite the weird trend rejecting college education, a bachelor’s degree is still both the most lucrative and the most secure path long term.
^^And how predatory Parent Plus loans can be.