Households with very low incomes actually spend more than those with slightly higher incomes, creating a noticeable bump in spending when income is extremely low. This pattern holds true across different employment statuses, education levels, and marital statuses. The reason for this unexpected trend seems to be that people with low incomes tend to underreport how much money they make. Even though they may not have much income, their spending habits suggest they are better off than their reported income would suggest. In fact, low spending is a better indicator of living standards than low income.