The Average American Household Spent $77,280 Last Year. Here’s What They Spent It On

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The 2023 Consumer Expenditure Survey is out — and boy has it got some things to tell us about how we’re spending our money. Read on to learn more. [[{“value”:”

Over the last four years, most of us have experienced such staggering growth in expenses that it’s hard to stay within a reasonable budget most of the time. In fact, I was just looking over my own expenses the other day and wondering just how I got to be such a reckless spender, when I used to be a very careful financial planner.

As it turns out, it’s not just me — or you. The most recent release of the Consumer Expenditure Survey from the U.S. Bureau of Labor Statistics is out, and boy, it’s not pretty. Although the income for households in 2023 was up to $101,805, a $7,800 gain, expenses are up, too. American households spent $77,280 last year, up $4,300 from 2022.

The average household size for this year was 2.5 people, with 1.3 wage earners and 0.6 children per household. All that considered, let’s take a look at what households are spending on, so we can compare how we’re doing.

1. Food

Americans are still eating out, but they’re also eating in. Food overall cost about $10,000 for the average household, $6,000 of which was for food at home — including purchases like home-cooked meals, snacks, and non-alcoholic beverages. Another $4,000 was spent eating out. Americans also spent $637 on alcoholic beverages in 2023.

Each of these figures is up from 2022, which should surprise no one who has been to a grocery store, a restaurant, or even logged onto social media recently.

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2. Housing

Housing is another huge expenditure for Americans, and that didn’t change this year. It’s up again, from $24,300 in 2022 to $25,400 in 2023. That’s nothing compared to the gain in food costs, though, so at least that’s something we can all kind of be happy about.

Homeowners paid about $8,700 on average for their property, renters shelled out about $5,370. Everybody combined spent about $4,600 on average for utilities, including telephone service, and about $2,500 for household furnishings.

Pro tip: Whether you own your home or rent, you can spend a few dollars on winterization to help reduce your utility costs year-round. As a homeowner, you may also qualify for tax deductions or credits for high-efficiency upgrades.

3. Clothing

We spent about $2,000 last year on clothing for our households, which comes down to about $800 per person. Not surprisingly, women’s clothing cost the most at $655 and footwear clocked in at $444.

This might seem like a lot, but consider it’s about $167 monthly per household for clothes and shoes — if your work-from-home wardrobe consists of more than worn out sweats, that’s really easy to spend. Don’t get me started on what it costs to actually go into the office every day.

4. Transportation

It costs a pretty penny to own a car in America, especially in 2023. The average cost per household for transportation was $13,000, most of which was taken up by car purchases ($5,500), gasoline ($2,694), and auto insurance ($1,775).

If you’re a public transportation devotee, the picture is a lot sunnier. You only spent $1,096 last year on transportation, but that’s way up over 2022’s $845 and more than double 2021’s $452.

Pro tip: You can keep your auto insurance prices in check by regularly shopping your insurance policy or adjusting your coverages to better suit your current financial picture.

5. Healthcare

Healthcare is another big expense for Americans, though it didn’t rise significantly in 2023. Healthcare overall was $6,159, up from $5,850 the year prior. Health insurance was the biggest cost at $4,000, with medical services a distant second at $1,252. We also spent about $600 on drugs and $267 on medical supplies.

Pro tip: Check out prescription drug coupons from places like GoodRX to help cut your healthcare spending. Many pharmacies also keep a low-cost drug list for common meds, which can be different between pharmacies.

6. Entertainment

Now that life is kind of back to normal, spending on admission fees for events is going up, too. Of the $3,600 spent on entertainment in 2023, almost $1,000 was on fees and admissions, up from $654 in 2021.

We also spent $876 on our pets and $975 on audio/visual equipment and services.

Pro tip: Pet insurance can help you save huge on your pets medical bills, especially if your plan has wellness coverage.

7. Retirement

We were thinking a lot about retirement and life insurance last year, with a whopping $9,556 spent on personal insurance and pensions. Over $9,000 of that was just money contributed to pensions and Social Security, and $546 was spent on life and other personal insurance.

Spending is up, but inflation is cooling

The fact that spending is up may feel terrible, but it’s because inflation has been so high over the last few years, and that’s driven the cost of everything else up. The monthly inflation rate peaked at 9.1% in June 2022, but is now back down to a more reasonable 2.5% and dropping, so even if you spent a lot more than you expected last year, relief is in sight for us all.

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