Understanding Generational Poverty

Generational poverty has many layers and contributing factors that trap families in a painful cycle. Sustainably helping poor children and poor families requires understanding the cycle of generational poverty, why it’s so common and what can be done to end it so that families can escape poverty, achieve economic mobility, and find new beginnings.

What is Generational Poverty?

Generational poverty affects millions of families worldwide. It refers to when poverty has become a familial pattern for at least two generations, although it typically affects multiple generations.

Unlike situational poverty, in which a family experiences poverty for a brief period due to a crisis, generational poverty is lasting and systemic. People affected by it lack any means to change their situation for themselves or their children, which makes it intergenerational — affecting them, their kids and those after them.

What Defines Poverty?

In many cases, poverty is used as a relative term. A low-income family in America may be considered a middle-class family by the standard of living in another country, depending on that country’s economic environment and minimum wage.

But globally, the standard definition of poverty is earning less than $2.15 per day. Living on this wage is extremely difficult. Yet surviving below the $2.15 per day poverty line is a reality for hundreds of millions of people around the world.

Poverty isn’t just about economics

The global poverty rate — and, by extension, generational poverty — is not determined solely by income. According to the Oxford Department of International Development, poverty has three dimensions1:

  • Health.
  • Education.
  • Living standards.

Not having access to health care, educational opportunities, affordable housing, nutritious food, clean water or social support initiatives like food stamps or Medicaid can all affect a person’s well-being and place him or her in poverty. And rarely is a person affected by just one of these poverty dimensions.

The fact that poverty is multidimensional makes generational poverty especially difficult to escape from. Even if someone can overcome one of the dimensions, more obstacles stand in their way.

Generational poverty can also be self-perpetuating. A child raised by a single parent struggling to make ends meet knows only the hardship of being a low-income family. Dreaming of a different future seems impossible, and hope is often suffocated.

What Causes Generational Poverty?

Generational poverty is not something that happens all at once. It occurs over time and is the product of many factors.

Lack of education or educational resources

Described by Horace Mann as “the great equalizer,” an education is how people acquire the life skills needed to pursue a profession. If high-quality educational resources aren’t available, individuals can’t obtain the knowledge and training that a well-compensated and fulfilling occupation requires.


According to the World Bank, Sub-Saharan Africa is home to 27 of the world’s poorest countries, and in these countries, 30% or more of the population is poverty-stricken2.

Living in a low-income country presents obstacles foreign to high-income countries. For instance, government policymakers in low-income countries may not provide social safety nets to help families maintain a healthy standard of living. But growing up in a high-income country has its challenges too.

Despite the United States having the world’s largest economy, the National Center for Children in Poverty reports 12% to 13% of Americans who were low- to middle-income in their youth remained in poverty in their twenties3.

Not having a livable wage

A livable wage is an income that enables families to afford fundamental, everyday living expenses without relying on government programs. If a livable wage is hard to come by, families aren’t equipped, empowered or positioned to take advantage of opportunities to change their circumstances.

Minimal or no capital

Capital refers to wealth or assets that can be used for a variety of purposes, such as investing, producing goods or generating income. Making money requires having money in the first place. Not having capital to begin with prevents income growth and perpetuates generational poverty.

Susceptibility to natural disasters, especially floods

No part of the world is immune to environmental catastrophe. Typhoons are an ongoing threat for Southeast Asia. Indonesia, Thailand and Peru are prone to earthquakes, and floods happen worldwide.

In some regions, poor government, bad infrastructure, population density, and unequal living conditions intensify the devastation of natural disasters. And the poor often pay the highest price.

Natural disasters rob families living in poverty of the little they have, making recovery difficult and advancement near impossible. And the cycle of generational poverty is fed and kept alive.

How Compassion International Breaks the Cycle of Generational Poverty

At Compassion, we work to free low-income children from lives in which survival is a daily accomplishment. We partner with thousands of local churches around the world, working alongside them and using their on-the-ground perspectives to address each dimension and type of poverty.

We do this through a holistic approach to child development, which is made possible through child sponsorship. We’re committed to getting at the root of poverty, combatting each of the effects poverty has on children.

Our program provides medical care, nourishing food, access to clean water, support from caring adults, educational opportunities, vocational skills, support for caregivers and more. We equip single mothers and their children, families on the verge of homelessness and the poorest of the poor to break free from poverty.

Children in our Child Sponsorship Program are enrolled in school and spend time each week with safe, caring adults at their child development center who tutor them, mentor them, and can identify and meet their unique needs. Our frontline church partners also provide vocational training and other income generation training to help children build fulfilling lives with healthy economic opportunity.

Center staff teach the importance of nutrition and hygiene and provide families with regular medical checkups, nutritious food and access to clean water. When serious medical concerns arise, we provide medical assistance.

Our church partners share the gospel, teaching each child that God loves them and that they were created for a powerful, purposeful future. We assist and love children of all faiths, cultures and races — a child or family doesn’t have to be Christian or ever profess faith to participate in our programs.

We are a Christ-centered, church-driven, child focused nonprofit committed to helping children in extreme poverty grow up to lead powerful futures in which they can be community leaders and role models for the next generation. Will you join us?

An early childhood spent in extreme poverty doesn’t mean the disparities of poverty have to choke generation after generation.

Sponsor a Child Today and Help Free Generations!

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1 Oxford Poverty and Human Development Initiative (2018). Global Multidimensional Poverty Index 2018: The Most Detailed Picture To Date of the World’s Poorest People, University of Oxford, UK.

2 Patel, Nirav. “Figure of the Week: Understanding Poverty in Africa.” Brookings, Brookings, 21 Nov. 2018, www.brookings.edu/blog/africa-in-focus/2018/11/21/figure-of-the-week-understanding-poverty-in-africa/.

3 Authors Robert Lee Wagmiller, et al. “Childhood and Intergenerational Poverty: The Long-Term Consequences of Growing up Poor.” NCCP, https://www.nccp.org/publication/childhood-and-intergenerational-poverty/.