Welfare benefits like food stamps, housing assistance and supplemental income are generally calculated on the basis of income. In other words, your benefits application will need to include a detailed accounting of your monthly wages or salary. It will also need to demonstrate that you have limited "resources" like cash savings, investments and property.
In most cases, a life insurance policy doesn't count as an "asset." Likewise, the value of the car that you own probably won't be applied towards your resource limit. However, the value of your home may be counted as a separate resource. In most cases, applicants for food stamps can't have access to more than $1,000 in cash savings. Although asset-value limits for real estate holdings vary from state to state, applicants who own valuable homes probably won't qualify for these benefits. Since state welfare agencies conduct thorough means tests and subject applicants to a barrage of finance-related questions, it's unwise to attempt to misrepresent your assets, savings or income on your application. The penalties for doing so can be harsh and may include hefty fines.
If you meet your state's limited-resource requirements, your ultimate eligibility for food stamps will probably be assessed on the basis of your income. In other words, your state's welfare agency won't take your ongoing expenses into account. Depending upon the size and flexibility of your budget, this may result in the denial of your application for benefits. If you have a heavy burden of household expenses despite a seemingly robust income, it's unlikely that you'll qualify for food stamps.
Your state's welfare agency will probably distinguish between "essential" and "non-essential" expenses. While it's likely to consider the former when determining whether to approve your application, it's not likely to look at the latter at all. "Essential" expenses might include ongoing outlays that are required by social convention and physical necessity. Most welfare agencies deem rent payments, utility bills and transportation expenses to be "essential" living costs. By contrast, cable bills, car payments, entertainment costs and other "frivolous" expenses won't fall into this category.
Your "essential" expenses may act to offset some of your income. Depending upon the policies of your state's welfare agency, these expenses may be subject to certain caps. For instance, you may not be permitted to claim a rent allowance that amounts to more than 30 percent of your monthly income. Likewise, your transportation costs may need to remain below a certain threshold. For more information, check with the appropriate authorities in your jurisdiction.