What Americans Spend: A Look At The Cost Of Housing, Food, Transportation And More – Bankrate.com

We are an independent, advertising-supported comparison service. Our goal is to help you make smarter financial decisions by providing you with interactive tools and financial calculators, publishing original and objective content, by enabling you to conduct research and compare information for free – so that you can make financial decisions with confidence.
Bankrate has partnerships with issuers including, but not limited to, American Express, Bank of America, Capital One, Chase, Citi and Discover.
The offers that appear on this site are from companies that compensate us. This compensation may impact how and where products appear on this site, including, for example, the order in which they may appear within the listing categories. But this compensation does not influence the information we publish, or the reviews that you see on this site. We do not include the universe of companies or financial offers that may be available to you.
Buying a home
Refinancing your existing loan
Finding the right lender
Additional Resources
Elevate your Bankrate experience
Get insider access to our best financial tools and content
Compare accounts
Use calculators
Get advice
Bank reviews
Elevate your Bankrate experience
Get insider access to our best financial tools and content
Compare by category
Compare by credit needed
Compare by issuer
Get advice
Looking for the perfect credit card?
Narrow your search with CardMatch™
Personal Loans
Student Loans
Auto Loans
Loan calculators
Elevate your Bankrate experience
Get insider access to our best financial tools and content
Best of
Brokerages and robo-advisors
Learn the basics
Additional resources
Elevate your Bankrate experience
Get insider access to our best financial tools and content
Get the best rates
Lender reviews
Use calculators
Knowledge base
Elevate your Bankrate experience
Get insider access to our best financial tools and content
Car insurance
Homeowners insurance
Other insurance
Company reviews
Elevate your Bankrate experience
Get insider access to our best financial tools and content
Retirement plans & accounts
Learn the basics
Retirement calculators
Additional resources
Elevate your Bankrate experience
Get insider access to our best financial tools and content
We are an independent, advertising-supported comparison service. Our goal is to help you make smarter financial decisions by providing you with interactive tools and financial calculators, publishing original and objective content, by enabling you to conduct research and compare information for free – so that you can make financial decisions with confidence.
Bankrate has partnerships with issuers including, but not limited to, American Express, Bank of America, Capital One, Chase, Citi and Discover.
The offers that appear on this site are from companies that compensate us. This compensation may impact how and where products appear on this site, including, for example, the order in which they may appear within the listing categories. But this compensation does not influence the information we publish, or the reviews that you see on this site. We do not include the universe of companies or financial offers that may be available to you.
While we adhere to strict , this post may contain references to products from our partners. Here’s an explanation for .
Founded in 1976, Bankrate has a long track record of helping people make smart financial choices. We’ve maintained this reputation for over four decades by demystifying the financial decision-making process and giving people confidence in which actions to take next.
Bankrate follows a strict editorial policy, so you can trust that we’re putting your interests first. All of our content is authored by highly qualified professionals and edited by subject matter experts, who ensure everything we publish is objective, accurate and trustworthy.
Our banking reporters and editors focus on the points consumers care about most — the best banks, latest rates, different types of accounts, money-saving tips and more — so you can feel confident as you’re managing your money.
Bankrate follows a strict editorial policy, so you can trust that we’re putting your interests first. Our award-winning editors and reporters create honest and accurate content to help you make the right financial decisions. Here is a list of our banking partners.
We value your trust. Our mission is to provide readers with accurate and unbiased information, and we have editorial standards in place to ensure that happens. Our editors and reporters thoroughly fact-check editorial content to ensure the information you’re reading is accurate. We maintain a firewall between our advertisers and our editorial team. Our editorial team does not receive direct compensation from our advertisers.
Bankrate’s editorial team writes on behalf of YOU – the reader. Our goal is to give you the best advice to help you make smart personal finance decisions. We follow strict guidelines to ensure that our editorial content is not influenced by advertisers. Our editorial team receives no direct compensation from advertisers, and our content is thoroughly fact-checked to ensure accuracy. So, whether you’re reading an article or a review, you can trust that you’re getting credible and dependable information.
You have money questions. Bankrate has answers. Our experts have been helping you master your money for over four decades. We continually strive to provide consumers with the expert advice and tools needed to succeed throughout life’s financial journey.
Bankrate follows a strict editorial policy, so you can trust that our content is honest and accurate. Our award-winning editors and reporters create honest and accurate content to help you make the right financial decisions. The content created by our editorial staff is objective, factual, and not influenced by our advertisers.
We’re transparent about how we are able to bring quality content, competitive rates, and useful tools to you by explaining how we make money.
Bankrate.com is an independent, advertising-supported publisher and comparison service. We are compensated in exchange for placement of sponsored products and, services, or by you clicking on certain links posted on our site. Therefore, this compensation may impact how, where and in what order products appear within listing categories. Other factors, such as our own proprietary website rules and whether a product is offered in your area or at your self-selected credit score range can also impact how and where products appear on this site. While we strive to provide a wide range offers, Bankrate does not include information about every financial or credit product or service.
Coverage.com, LLC is a licensed insurance producer (NPN: 19966249). Coverage.com services are only available in states where it is licensed. Coverage.com may not offer insurance coverage in all states or scenarios. All insurance products are governed by the terms in the applicable insurance policy, and all related decisions (such as approval for coverage, premiums, commissions and fees) and policy obligations are the sole responsibility of the underwriting insurer. The information on this site does not modify any insurance policy terms in any way.
Many Americans spend a pretty penny each month to keep a roof over their heads, food on the table and a means of transportation. Other items commonly found in household budgets include education, child care, health care, retirement savings and entertainment.
You can take stock of how your own budget compares by looking at the average American household budget. The Consumer Expenditure Survey published by the U.S. Bureau of Labor Statistics (BLS) lists the average amount spent on everything from housing and transportation to entertainment, clothing and charitable contributions. The most recent data available is from 2020.
The average household earned $84,352 a year and spent $70,258 a year, according to the BLS survey. Based on the data, about $5,854 a month went toward bills and other expenses. The largest expenditures were housing and transportation, which comprised 29 percent and 13 percent of the average budget, respectively. Another big spending category was food, to which 10 percent was devoted.
In addition to major categories like housing, transportation and food, consumers dedicated money from their budgets to things like health care (7 percent), entertainment (5 percent), education (2 percent), and Social Security contributions, personal insurance and retirement plans (10 percent).
Other common expenses included child support payments, care of students away from home, apparel, and contributions to religious or charitable organizations. An average of 13 percent of money earned was assigned to personal taxes.
*Due to rounding, percentages do not add up to 100%.
Housing expenses increased 3.5 percent overall in 2020 over the previous year, according to the BLS survey, with the average household spending $21,409 a year for housing, including rent or mortgage payments, utilities, furnishings, and laundry and cleaning supplies.
Housing-related expenditures for homeowners included an average of $7,473 a year for things like taxes, interest and maintenance:
Utilities accounted for about 19 percent of housing-related expenses, and Americans have paid more each consecutive year, rising to an average $4,158 in 2020 from $3,737 in 2013. Included are costs of heating and cooling, as well as internet and cellphone service. Utility costs for 2020 were::
What Americans pay to heat and cool their homes depends on where they live, as energy costs in the U.S. vary significantly based on region.
Stay-at-home orders and remote work in 2020 affected transportation costs for the year, with an average $9,826 spent per household, reflecting a nearly 9 percent decrease over the previous year. Conversely, the average household expenditure for vehicle purchases was up very slightly — nearly 3 percent — in 2020 over 2019. Transportation expenses for the average household in 2020 were:
American households earned an average of $84,352 in 2020 and paid an average of $9,402 in personal income taxes, after an average of $1,911 in government stimulus payments is factored in. The tax burden was the lowest amount paid since 2015, thanks to the stimulus payments.
The total in income taxes was made up of $8,812 in federal taxes, $2,430 in state taxes and $72 in other taxes.
Food continued to be a big part of most consumers’ budgets. On an average day, about 14 percent of Americans shopped for groceries, according to a recent study by the U.S. Department of Agriculture’s Economic Research Service.
Nearly 12 percent of the American budget went to food, based on the BLS 2020 expenditures survey. Two-thirds of money spent, or $4,942, was on food eaten at home, while $2,375 was spent on meals eaten away from home. The figures reflect a 33 percent drop from 2019 in the average amount of money spent on food eaten outside the home, as eating at home in 2020 became more common due to the pandemic.

The percentage of the $4,942 at-home food budget in 2020 can be broken down into these categories:
There’s a good chance retirement savings is a line item in your budget, whether you’re in your 20s, 60s or somewhere in between. The money may be taken out of your paycheck automatically if you’re enrolled in a 401(k) plan, or you may choose to fund a Roth IRA with money after it’s been taxed.
Americans may also contribute to an employer pension as well as Social Security, and the funds for both are usually taken automatically from each paycheck. An average of $6,760 was contributed in 2020 by American households for these purposes, reflecting a nearly 2 percent increase over the previous year.
In 2020, American households earned an average of $74,949 after taxes and devoted $61,334 to household budgets, leaving $13,615 that could be used for things like increasing savings, and paying off credit cards, student loans or other debts.
Beefing up emergency savings was cited by 14 percent of adults in a recent Bankrate personal finance survey as a goal for 2022. The personal savings rate can be defined as the percentage of disposable income left after taxes and monthly spending are accounted for. The Bureau of Economic Analysis reported these personal saving rates for recent months in 2021:
Health-care expenses have been eating into Americans’ budgets more each year, costing the average household $5,177 in 2020 for insurance and out-of-pocket medical expenses, including:
Premiums are the amount paid each month for a health insurance plan and vary by type of plan, the state you live in, and state and federal laws.
You can help reduce health-care costs by shopping for a plan with the best rates. Often lower rates come with plans that have higher deductibles, however, so those enrolled in such plans should set aside money to help cover medical emergencies.
Households spent an average of $1,271 on education a year in 2020, based on the latest BLS survey. The tuition for public elementary and high schools is funded through taxpayer dollars, while parents seeking private education for a child paid an average of $8,700 a year for grade school and $14,500 for high school.
Families helping their kids pay for college can be faced with hefty bills, although tuition at a state school can help reduce the costs. Average tuition for a student living on campus was $25,834 at a four-year, in-state university, compared with $53,949 at a private institution.
Nearly 5 percent of the average household’s spending was for entertainment purposes, which was down almost 6 percent from the previous year, according to the survey. Expenditures on fees and admissions dropped in 2020 due to the pandemic, while consumers spent more on toys, hobbies and playground equipment. Here’s how much was spent on each entertainment category:
Those wishing to get a better handle on entertainment spending should consider following the 50/30/20 rule, for which 50 percent of after-tax earnings is devoted to needs, 30 percent to wants and 20 percent to savings. The middle 30 percent can be devoted to entertainment or recreational activities like dining out, movies, streaming services and vacations.
Creating a household budget may seem like a daunting task, but it can help alleviate unnecessary costs throughout the year and keep you on track with saving money, whether you want to add to your savings account, lock in a rate with a CD or aim for a higher yield with a money market account. Starting a budget can be as easy as taking some simple steps:
Bankrate.com is an independent, advertising-supported publisher and comparison service. Bankrate is compensated in exchange for featured placement of sponsored products and services, or your clicking on links posted on this website. This compensation may impact how, where and in what order products appear. Bankrate.com does not include all companies or all available products.
Bankrate, LLC NMLS ID# 1427381 | NMLS Consumer Access
BR Tech Services, Inc. NMLS ID #1743443 | NMLS Consumer Access
© 2022 Bankrate, LLC. A Red Ventures company. All Rights Reserved.

source

Leave a Comment