Do yours look alike?
- Americans spend an average of $5,111 per month.
- Housing is the single largest expense for the typical American.
Have you ever wondered how your expenses compare to those of others? It’s natural to be curious about other people’s finances. And knowing how your expenses stack up could tell you if certain changes may be warranted. With that in mind, here’s how Americans are spending their money these days, according to new data.
1. Accommodation: $1784
The average American spends $1,784 on housing, but that total includes expenses like utilities and maintenance. Now, in reality, housing can be your biggest monthly expense, and since it’s easy to tie your quality of life to the house you live in, it might be worth spending a bit more on the roof above. of your head. As a general rule, your housing costs should not exceed 30% of your net salary. If you’re past that point, you might want to consider relocating or downsizing.
2. Freight: $819
Transportation is the most important expense for the typical American after housing. The $819 spent by the average person includes not only car loan payments, but also car insurance, maintenance and gas. And given that gas prices are on the rise these days, it wouldn’t be surprising to see that number go up.
3. Personal insurance and pensions: $604
Purchasing life insurance is an important step in protecting your loved ones. In a way, it’s a good thing to see the average American spending a good amount of money on insurance (for clarity, homeowners and car insurance are not included in this category). That said, within this category, only a small portion typically goes to insurance. The rest goes towards pension contributions and social security contributions, which are unavoidable.
4. Health care: $431
Even insured Americans spend a lot of money on health care. For one thing, many people pay some, if not all, of their insurance premiums. Add in deductibles, copayments, and medical supplies, and it’s easy to see why health care is such a big expense.
5. Grocery: $412
Food prices are rising these days thanks to inflation. Unsurprisingly, groceries make up a pretty big chunk of a typical person’s income. But it makes more sense to spend more on groceries than on restaurant meals. As fun as dining out can be, you get a lot more bang for your buck when you buy groceries and cook meals yourself.
6. Entertainment: $243
We all deserve to enjoy life between work. The typical American spends $243 a month on entertainment, and that’s a perfectly acceptable amount to shell out if you’re covering your essential bills and not racking up a tab on your credit cards in the process. But if you’re struggling to make ends meet, you may need to temporarily cut back on your entertainment.
7. Restaurants and prepared meals: $198
The average American spends nearly $200 a month on restaurants and eating out. If you’ve recently switched from working remotely to working in an office, you might see your spending increase in this category. But be careful – restaurants and catering establishments charge notorious markups, so if money is tight you might want to consider cooking more of your own food instead.
Americans spend most of their money on these seven expenses, and your habits may or may not be comparable. But while knowing what the typical consumer spends can help satisfy your curiosity, remember that ultimately how much the average person can afford to spend on housing, transportation, or other bills may not be the same as what you can afford. Rather than focusing on averages, make sure your current budget works for you.
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