When you create a new variable based on the recoded values of another variable, there are two basic rules you should follow. The recoded categories should be:

  • Mutually exclusive. There shouldn't be any overlap in category definitions. For example, the categories 25-50 and 50-75 are not mutually exclusive, since both categories contain the value 50.
  • Exhaustive. There should be appropriate categories for all values of the original variable. For example, the categories 25-49 and 50-74 would not include values that might fall between 49 and 50.

Although all the income values in the demo.sav data file appear to be integers, just to be on the safe side we used the categories 25-49.999 and 50-74.999 to make sure none of values were left out.