Monthly Cost of Credit Card Debt Monthly Cost of Groceries for 2 Adults and 1 Baby
American Households' Average Monthly Expenses: $v,111
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The average monthly expenses for American households are $5,111, co-ordinate to the most recent Consumer Expenditure Survey from the U.Due south. Bureau of Labor Statistics (BLS).
Where does all that money become? For the typical person, information technology covers quite a few different things from major costs like payments to their mortgage lender and groceries to smaller expenses like apparel.
By peeking into the national average budget for all these categories, we tin can get a better thought of where people spend the most and how our own spending habits compare.
Fundamental findings
- The average household's monthly expenses are $v,111 ($61,334 per year).
- The average annual income after taxes is $74,949.
- Housing is the largest average cost at $1,784 per calendar month, making upward 34.nine% of typical spending.
- Americans spend $610 on food per calendar month, with well-nigh two-thirds existence spent on groceries and the rest on eating out.
- Transportation costs more than many realize ($819 per month), largely due to the intermittent nature of these expenses.
- Healthcare spending averages $431 per month.
- The average unmarried person spends $329 more per year than their take-home pay.
Boilerplate monthly expenses per household: $five,111
The average expenses per month for one consumer unit in 2020 was $5,111. That means the boilerplate spending per year is $61,334.
Proceed in mind that living toll varies past region -- some cities are very affordable, while others are extremely expensive. The figures presented below are national averages.
Consumer spending in the United states of america had been steadily increasing, only 2020 was a departure from that trend, likely considering of the COVID-19 pandemic. Average expenses decreased past 2.7% from 2019 to 2020.
You might be wondering what exactly counts as a consumer unit of measurement. The BLS defines a consumer unit of measurement every bit any of the following:
- Families
- Single persons living alone
- Single persons sharing a household with others but are financially contained
- 2 or more people living together and sharing major expenses
For case, two parents and a child would be ane consumer unit. Three roommates would exist three consumer units. The boilerplate consumer unit is 2.v people.
Average annual income per household: $74,949
The boilerplate American household's annual income later taxes is $74,949. Average pre-tax income is $84,352.
Based on the income and spending figures, Americans spend 82% of their income subsequently taxes and have a savings rate of 18%. That's close to the recommended savings rate of at least 20%.
While the amount you save is virtually important, where you lot put that coin also matters. The best option is a high-yield savings business relationship to maximize the interest you earn.
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Where Americans spend their money
Here'southward a full breakup of the average spending past category:
| Item | Monthly cost | Almanac cost | Per centum of spending |
|---|---|---|---|
| Housing | $1,784 | $21,409 | 34.9% |
| Transportation | $819 | $nine,826 | 16.0% |
| Personal insurance and pensions | $604 | $7,246 | 11.8% |
| Healthcare | $431 | $five,177 | 8.four% |
| Groceries | $412 | $4,942 | 8.1% |
| Entertainment | $243 | $2,912 | 4.7% |
| Restaurants and other meals away from home | $198 | $ii,375 | 3.9% |
| Cash contributions | $190 | $2,283 | 3.7% |
| Dress and services | $120 | $1,434 | 2.3% |
| Teaching | $106 | $1,271 | two.1% |
| Miscellaneous | $76 | $907 | i.v% |
| Personal care | $54 | $646 | 1.ane% |
| Alcoholic beverages | $40 | $478 | 0.8% |
| Tobacco/smoking products | $26 | $315 | 0.v% |
| Reading | $ten | $114 | 0.2% |
| TOTAL SPENDING | $5,111 | $61,334 |
Data source: U.Due south. Bureau of Labor Statistics (2021).
A quick annotation about monthly spending
The BLS survey only calculates annual spending, and then we divided those numbers by 12 to get the average household expenses per month. Because we rounded to the nearest dollar, there may be small discrepancies when comparison the monthly and almanac numbers.
It's also worth noting that not all of the typical expenses are monthly expenses. Some of these expenses are intermittent. For instance, about people aren't spending $196 per month on piece of furniture and appliances. Merely over the class of the year, the average is $2,346.
Boilerplate monthly spending on housing: $i,784 (34.9%)
Housing is the biggest living expense in the national average budget by a broad margin, and it increased by iii.5% in 2020.
Of the $1,784 per month that Americans spend on housing, $ane,050 of it goes towards housing payments. This fluctuates quite a flake depending on a person's living situation. Average housing costs tin be anywhere from nether $1,000 to over $3,000 depending on the area. Housing size and whether a person has roommates also have a big impact on how much they spend hither.
Here's a more detailed look at the unlike expenses of dwelling house ownership and how much Americans spend on them:
| Housing expense | Boilerplate monthly spending | Boilerplate annual spending |
|---|---|---|
| Shelter | $one,050 | $12,604 |
| Utilities/fuels/public services | $347 | $4,158 |
| Article of furniture/appliances | $196 | $2,346 |
| Household operations | $122 | $1,465 |
| Housekeeping supplies/laundry | $lxx | $837 |
Information source: U.S. Bureau of Labor Statistics (2021).
Average monthly spending on transportation: $819 (16.0%)
Transportation is the 2d-largest monthly expenditure, but Americans have been spending less on it. National average transportation spending decreased past viii.5% from 2019 to 2020.
It'south easy to miss only how much we spend on transportation, because some of the bigger expenses are intermittent. Maintenance and repairs aren't necessary every month, but they add upward to $879 per year. Virtually people don't purchase new vehicles oftentimes, but when they do, information technology's a major buy. Depending on the payment schedule you cull, motorcar insurance could be a monthly expense or one that you pay twice a yr.
| Transportation expense | Average monthly spending | Boilerplate annual spending |
|---|---|---|
| Vehicle purchases | $377 | $4,523 |
| Insurance | $131 | $1,575 |
| Gas and oil | $131 | $i,568 |
| Maintenance/repairs | $73 | $879 |
| Rental/leases/fees | $63 | $758 |
| Public transportation | $22 | $263 |
| Vehicle finance charges | $22 | $258 |
Data source: U.S. Agency of Labor Statistics (2021).
Average monthly food spending: $610 (12.0%)
Food spending includes groceries and food abroad from home, which is any food that you pay someone else to prepare for you. It decreased by 10.4% from 2019 to 2020.
In that location's one articulate reason for that drop in nutrient spending, and it probably won't come every bit a surprise because the circumstances in 2020: people seriously cutting dorsum on dining.
The average American spent over $ane,000 less on food away from home in 2020 ($two,375) than in 2019 ($3,526). Overall, spending dropped by 32.6% in this category. Grocery spending, on the other manus, increased past half-dozen.4%. If you've seen your ain supermarket spending increase, a grocery credit card could assistance you relieve on that.
| Nutrient expense | Boilerplate monthly spending | Boilerplate annual spending |
|---|---|---|
| Groceries | $412 | $four,942 |
| Nutrient abroad from dwelling house | $198 | $2,375 |
Data source: U.Southward. Bureau of Labor Statistics (2021).
Boilerplate monthly personal insurance and pension spending: $604 (11.8%)
Personal insurance and pensions accounted for $604 in monthly spending. That was a slight (one.1%) increment from 2019.
To clarify, this category includes life insurance, personal liability insurance, blow insurance, and disability insurance. It doesn't include homeowners insurance or renters insurance, which are part of housing costs, or auto insurance, which is part of transportation.
But vi.vii% of spending in this category goes towards personal insurance. The remaining 93.3% goes to pensions and Social Security. That category includes contributions to retirement accounts and the Social Security benefits withheld from your paycheck.
| Personal insurance and pension expense | Average monthly spending | Average annual spending |
|---|---|---|
| Personal insurance | $41 | $486 |
| Pensions/Social Security | $563 | $6,760 |
Data source: U.S. Bureau of Labor Statistics (2021).
Average monthly healthcare spending: $431 (eight.4%)
Despite the COVID-nineteen pandemic, healthcare spending didn't change much in 2020. Information technology decreased by 0.three% from the previous yr.
Only over seventy% of that spending went towards health insurance premiums, which cost an average of $306. That probably sounds low for health insurance. It's partly considering many people pay less due to tax credits, employer-paid premiums, Medicare, and Medicaid. In addition, viii.half dozen% of Americans don't have health insurance, according to the U.S. Census Bureau.
| Healthcare expense | Average monthly spending | Average annual spending |
|---|---|---|
| Health insurance | $306 | $iii,667 |
| Medical services | $72 | $864 |
| Drugs | $40 | $476 |
| Medical supplies | $14 | $170 |
Data source: U.S. Bureau of Labor Statistics (2021).
Average monthly spending on entertainment: $243 (4.7%)
Americans spend four.7% of their monthly budgets on amusement. Spending in this category decreased by 5.8% in 2020.
The BLS made some interesting decisions in what was and wasn't considered entertainment. As entertaining every bit pets can be, pet owners would probably argue that they deserve their own category. Avid readers may exist surprised to larn that reading doesn't fall nether entertainment (it has its own category instead).
| Entertainment expense | Average monthly spending | Boilerplate annual spending |
|---|---|---|
| A/V equipment and services | $87 | $1,049 |
| Pets | $58 | $690 |
| Other entertainment supplies, equipment, and services | $48 | $579 |
| Fees and admissions | $35 | $425 |
| Toys/hobbies | $14 | $170 |
Data source: U.S. Bureau of Labor Statistics (2021).
Average monthly spending on apparel and services: $120 (ii.3%)
Information technology's safety to say that people weren't too concerned virtually dressing up during the early days of the pandemic. Apparel spending plummeted in 2020, dropping by 23.8% from the year before.
| Clothes and services expense | Boilerplate monthly spending | Average annual spending |
|---|---|---|
| Men and boys | $27 | $326 |
| Women and girls | $45 | $545 |
| Children under two | $six | $68 |
| Footwear | $26 | $314 |
| Other apparel and services | $15 | $181 |
Data source: U.S. Bureau of Labor Statistics (2021).
Average monthly expenses past household size
So far, nosotros've looked at the average living expenses per consumer unit, which represents the average household. But many households won't fit into the boilerplate.
If you lot're a single person, y'all're probably interested in the average monthly expenses for one person. And those with larger families may want to run into what the typical spending habits are similar in like households.
Every bit it turns out, unmarried-person households have it much harder financially than households with two or more people. In fact, single people spent $329 per year more than their after-tax income.
| Household size | Boilerplate monthly spending | Average annual spending | Average income later on taxes |
|---|---|---|---|
| One person | $3,241 | $38,895 | $38,566 |
| Two people | $v,271 | $63,254 | $78,108 |
| Three people | $5,812 | $69,740 | $89,187 |
| Four people | $vii,005 | $84,056 | $109,306 |
| Five people | $6,746 | $80,954 | $108,451 |
Data source: U.South. Bureau of Labor Statistics (2021).
How exercise your average monthly expenses compare?
It'south interesting to see what the typical American spending habits wait like and compare them to your own. Peradventure yous find that you spend similar portions of your monthly income in each category, or your spending patterns could be completely dissimilar.
Neither on its own is a good or a bad thing. We all have different things we value and unlike areas where we're willing to spend more money. If y'all're happy with your spending habits and you lot experience financially secure, that's what'due south important.
If yous're not able to save as much money as you like, then information technology's a good thought to reevaluate your typical spending and your budget. Whether it's dining out, amusement, or something else, at that place could be an expanse where you're spending more than you lot realize and are able to cut back.
Sources
- U.S. Bureau of Labor Statistics (2021). "2020 Consumer Expenditure Survey."
- U.Southward. Bureau of Labor Statistics (2021). "Consumer expenditures in 2020."
- U.South. Agency of Labor Statistics (2021). "Table 1400. Size of consumer unit: Almanac expenditure means, shares, standard errors, and coefficients of variation, Consumer
- Expenditure Surveys, 2020."
- United States Census Agency (2021). "Health Insurance Coverage in the Usa: 2020."
Source: https://www.fool.com/the-ascent/research/average-monthly-expenses/
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