Means tested benefits are benefits that are provided to people who meet certain requirements in terms of their means or finances. The term is often associated with the process to secure financial aid in order to obtain a higher education, but may also refer to benefits that are extended through a social service organization or private institution to aid people with specific financial needs. Typically, there is a specific process required in order to apply for the benefits, as well as a range of criteria that must be met in order to be approved for those benefits.
When it comes to obtaining financial aid for college, means tested benefits usually focus on evaluating the financial condition of the student. For applicants who have recently graduated from high school and are currently living with parents or legal guardians, the process normally takes into account that household income. Other assets such as the balances in savings accounts may also be taken into consideration when evaluating the application for assistance. Assuming that the request is approved, the student is normally able to use the funds for any college-related expense, including tuition, fees, books, and living accommodations on or off campus.
Discounted housing is another example of means tested benefits. In many nations across the world, government managed housing is provided to qualified applicants at rates that are below the average rental amount in the area. This type of assistance can be especially helpful for households that include a single parent along with children, adults with disabilities that prevent them from holding down full-time jobs, and low-income families in general. As with most other types of means tested benefits, an income level under a certain amount is required in order to gain access to the discounted housing.
Means tested benefits may be extended for a short period of time and are often subject to review. For example, a college student may have to reapply for the benefits each new school year. Recipients of government subsidized housing may be required to provide documentation on income levels on an annual basis. The idea is to make sure that people who still qualify continue receiving the benefits, while those who no longer have need assistance can be released from the system and those resources used to aid someone else who is in need.
The scope of means tested benefits covers a wide range of subjects. In some nations, benefits related to tax breaks for lower-income taxpayers are common. Unemployment benefits and even access to healthcare for individuals who have income streams under a certain level are also fairly common. As long as the extension of the housing, college funding, or tax breaks are based on the financial status of the recipient, the assistance that is extended can correctly be referred to as means tested benefits.
