How Americans Spend Their Money?


Americans spend their money in a variety of ways, and understanding how they do so is essential to gaining insight into our national economy. Knowing where American’s money goes can help inform decisions at both the individual and government level. This article will discuss key findings regarding how Americans spend their money, and the implications of these findings.

The most recent analysis of how Americans spend their money is based on the Bureau of Labor Statistics’ (BLS) 2017 Consumer Expenditure Survey. This survey includes data from over 13,000 households, providing a comprehensive look at the spending habits of Americans. Unsurprisingly, the survey found that the majority of spending was devoted to housing, transportation, and food. Additionally, the survey highlighted regional and demographic differences in how Americans spend their money, as well as the growing trend of online shopping.

This article will provide a comprehensive overview of the key findings from the 2017 Consumer Expenditure Survey. Additionally, it will discuss the implications of these findings, as well as the potential implications of future trends, such as the increasing prevalence of online shopping. Understanding how Americans spend their money is essential to gaining insight into the current state of our economy, and this article will provide an informative and comprehensive overview of the key findings.


Household spending trends

In the United States, household spending has been on an upward trend since the mid-2000s, driven largely by increases in disposable income and an overall rise in the cost of living. According to the Bureau of Labor Statistics, the average U.S. household spent more than $60,000 in 2018, an increase of more than 10 percent since 2011.

When it comes to the breakdown of how Americans spend their money, housing has consistently been the largest expense, accounting for more than one-third of average household spending. This spending is followed by transportation, which makes up around 17 percent, and food, which makes up around 13 percent. Healthcare and insurance spending makes up around 10 percent of total household spending, and personal care products and services makes up around 8 percent.

In recent years, there has been an overall shift in spending from goods to services. This shift is largely driven by an increase in spending on services like health care, education, and entertainment. In 2018, services accounted for more than two-thirds of total household spending, up from less than 60 percent in the early 2000s.

At the same time, households have seen their spending on goods decline. This decline is most notable in spending on clothing and footwear, which has dropped from more than 10 percent of total household spending in the early 2000s to less than 5 percent in 2018. Households have also seen a decline in spending on furniture and appliances, which has dropped from more than 5 percent of total spending to less than 3 percent.

Overall, the trends in household spending in the United States show that Americans are spending more on services and less on goods. This shift is likely to continue in the future as the cost of living continues to rise and disposable income increases.

Housing expenses

When it comes to housing expenses, there are several sub-categories to consider. These include rent or mortgage payments, property taxes, maintenance costs, and utility bills.

Rent or mortgage payments are the most significant housing expense for many. This is the amount of money paid on a regular basis to keep a roof over your head. Property taxes are also a major expense for homeowners. This is a tax that must be paid to the government for the right to own a certain property. Maintenance costs are necessary expenses to keep the property in good condition. This may include regular cleaning and repairs to the property. Utility bills are also a factor when considering housing expenses. These bills include expenses for water, gas, electric, and other services.

When considering how to save money on housing expenses, there are several tips to follow. For starters, shop around for the best deals on rent or mortgage payments. This can be done by comparing different properties and seeing which offers the best deal. For homeowners, consider refinancing your mortgage to get a lower interest rate. This can help to reduce the total cost of the mortgage. When it comes to property taxes, be sure to take advantage of any tax deductions or credits that may be available. Finally, look for ways to reduce utility bills by using energy-efficient appliances and turning off lights and electronics when not in use.

Food and Beverage Expenses

Americans spend a significant portion of their income on food and beverages each year. According to the Bureau of Labor Statistics, in 2018 the average American household spent 11.9% of their income on food and beverages. This includes groceries, eating out, and alcoholic beverages.

When it comes to grocery shopping, it is important to plan meals and make lists before heading to the store. Avoid pre-packaged foods and opt for fresh ingredients. Buying in bulk can also help save money, as long as the food will not spoil before it is consumed.

When eating out, consider opting for places that offer discounts or special promotions. Avoiding alcoholic beverages and appetizers can also help to cut down on the cost.

When it comes to alcoholic beverages, consider drinking at home. Buying in bulk or finding deals on alcohol can help reduce costs.

Overall, saving money on food and beverage expenses requires planning, creativity, and discipline. By planning meals, making lists, buying in bulk, and taking advantage of deals, consumers can save money and still enjoy their favorite foods and beverages.

Transportation expenses

Owning a car can be a major expense, with costs including car payments, gas, insurance, and maintenance. Car payments can vary depending on the type of vehicle purchased and the length of the loan. Gas prices can also vary depending on the area, but fluctuate with the changing price of oil. Insurance costs also vary depending on the type of vehicle, age of the driver, and other factors. Maintenance costs can include oil changes, tire rotations, and brake repairs.

Public transportation or ridesharing services can be a less expensive alternative to car ownership. Public transportation can include buses, trains, and subways, with rates varying by area. Ridesharing services can include companies like Uber and Lyft, with rates varying by the length and distance of the trip.

To save on transportation expenses, consider the following tips:

  • Carpool with friends and family to save on gas costs.
  • Invest in a fuel-efficient vehicle to reduce gas costs.
  • Bundle auto insurance with other insurance policies to get a discount.
  • Invest in preventative maintenance services to reduce repair costs.
  • Consider public transportation or ridesharing services when possible.
  • Look for discounts or promotions when using ridesharing services.
  • Compare rates and prices when purchasing a vehicle.

Healthcare Expenses

Healthcare expenses can be significant, including insurance premiums, co-pays, and out-of-pocket expenses. Insurance premiums can be expensive, especially if family members are included in the coverage. Co-pays are the amount of money that must be paid each time a person visits their doctor or receives medical care. Out-of-pocket expenses are those costs that are not covered by insurance, such as medical supplies, vision care, and dental care.

The Affordable Care Act (ACA) has had a major impact on healthcare expenses. It has made health insurance available to more people than ever before. It has also reduced the amount of money people must pay for insurance, and it has eliminated pre-existing condition exclusions. Additionally, the ACA offers subsidies to lower-income individuals and families to help them pay for health insurance.

There are several ways to save money on healthcare expenses. Shopping around for insurance plans is important, as different policies will have different premiums and co-pays. It is also a good idea to use generic drugs when possible, as they are often much less expensive than brand-name drugs. Additionally, people should take advantage of preventive care, such as regular check-ups, which can help catch problems early and avoid costly medical care down the road. Finally, people should consider joining a health savings plan, which can help them save money on medical expenses.

Entertainment expenses

Entertainment expenses cover a wide range of activities, from movies, to sports, to concerts, and other leisure activities. All of these activities can provide enjoyment and relaxation, but they can also be quite expensive. It is important to consider the cost of entertainment expenses when budgeting for the month, and to find ways to save money on these activities.

Movies: Movie tickets can be quite costly; consider watching movies at home instead. Renting movies or streaming films online can significantly reduce the cost. Look for coupons or discounts for movie tickets, and consider going to matinee shows which are usually cheaper.

Sports: Consider attending games at small local venues or colleges where the tickets are usually cheaper. Look for season tickets, and check for discounts or special offers.

Concerts: Look for discounted tickets online or buy tickets from resellers. Consider attending smaller shows at smaller venues, as they may be less expensive.

Other leisure activities: Look for free or discounted activities in your local area. Check for discounts or special offers for activities such as bowling, skating, mini golf, and more. Research for activities that are free or low cost, such as visiting local parks or museums.

Finally, consider exploring activities that are free or low cost. Get creative and find ways to have fun without spending a lot of money. With some research and planning, entertainment expenses can be enjoyable and affordable.

Education expenses

Education expenses can add up quickly, and it is important to understand what costs are associated with attending school. Tuition is the biggest expense associated with education, and it can vary greatly depending on the type of school and the length of the program. It is also important to consider other educational costs such as books, lab fees, supplies, and technology fees.

Student loan debt is a major issue for many households, as the costs associated with obtaining an education can be significant. It is important to understand the terms of any loan taken out and be aware of the potential impact of loan payments on overall household finances.

There are a few tips to help save money on education expenses. Shopping around for the best tuition rates and researching scholarships and grants are a great way to reduce the cost of tuition. Additionally, students can save money by renting textbooks or borrowing from the library, and looking for deals on other educational materials such as laptops and supplies.

Savings and investments

Savings and investments are important for securing future financial stability. By setting aside money and investing wisely, individuals can build up a nest egg to support them during retirement or in times of financial difficulty.

Savings accounts are the most accessible form of savings, as they generally require little or no initial deposit and offer relatively low interest rates. Certificates of Deposit (CDs) also offer a low-risk option, and they typically provide higher interest rates than savings accounts.

Stocks, bonds, and mutual funds are a riskier form of investing, but they offer higher potential returns than savings accounts or CDs. For people who want to invest in stocks, bonds, and mutual funds, it is important to understand the risks associated with each investment, as well as the potential for both profit and loss.

Retirement accounts, such as 401(k)s, IRAs, and annuities, are an important part of securing a comfortable future. Retirement accounts provide tax advantages and allow individuals to save money for the future while taking advantage of compound interest.

To save and invest wisely, it is important to understand financial goals and risk tolerance. Individuals should create a budget and stick to it, as well as diversify their investments to reduce risk. Additionally, individuals should take advantage of tax incentives to maximize returns. Finally, individuals should be mindful of fees associated with investments, as these can significantly reduce returns.


It is clear that Americans spend their money on a variety of items and services, ranging from the basic necessities of life to luxury items and experiences. A major source of money is income and wages, with Americans utilizing various methods of financing and credit to purchase items and services. The data shows that Americans are spending more on travel, entertainment, and healthcare, while also spending less on food, apparel, and housing. Additionally, Americans are saving less of their income than in previous years, which has implications for long-term financial security.

Overall, it is important to understand and manage how Americans spend their money. To do this, it is important to create and stick to a budget, track expenses, and save for the future. It is also important to be aware of financial products, such as credit cards, to make sure they are used responsibly. By following these tips, Americans can ensure that their money is being used in a way that will lead to long-term financial security.

FAQs – How Americans Spend Their Money?

1. How do Americans spend their money?

Americans spend their money on a variety of goods and services, including food, housing, healthcare, transportation, entertainment, and other personal expenditures. The average American household spends approximately two-thirds of its income on these items.

2. What do Americans spend the most money on?

The biggest expense for Americans is housing costs, which account for 33% of total expenditures. This is followed by transportation (16%), food (13%), healthcare (9%), and other personal expenses (7%).

3. How much money do Americans spend on food?

Americans spend approximately 13% of their total expenditures on food. This includes food purchased at restaurants, grocery stores, and other food outlets.

4. How do Americans spend their disposable income?

Americans typically spend their disposable income on leisure activities and entertainment, such as going to the movies, dining out, and shopping. Other popular items include travel, technology, and apparel.

5. How much of their income do Americans save?

Americans save approximately 5% of their income, on average. This is slightly lower than the global average of 7%.

6. How much money do Americans spend on vacations?

Americans spend an average of $1,145 per person, per vacation. This includes airfare, hotel accommodations, meals, and entertainment.

7. How much do Americans spend on healthcare?

Americans spend approximately 9% of their total expenditures on healthcare. This includes medical expenses, prescription drugs, and health insurance premiums.

8.  How much money do Americans spend on entertainment?

Americans spend an average of $2,482 per year on entertainment, including movies, music, books, and video games.

9. How much money do Americans spend on transportation?

Americans spend approximately 16% of their total expenditures on transportation, including car payments, gas, and public transportation.

10. How much money do Americans spend on clothing?

Americans spend an average of $1,704 per year on clothing and footwear. This includes everything from casual apparel to formal wear.


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