The annual cost of living for an average household in America is $63,784, according to the U.S. Bureau of Labor Statistics. Where does all that money go? Look at the infographic below to see where Americans spend their hard-earned cash.
Households spend 16 percent of their budget on mortgage or rent costs. An additional 11 percent goes to expenses that have to do with the home, such as appliances, electronics, utilities, home security systems, and cleaning expenses.
Those who choose to rent instead of buying their place of residence won’t save money in the long run. The average yearly cost of renting is almost the same as paying off a mortgage. Buyers have the added benefit of eventually owning the property, which means they will recoup a portion of their investment, either through selling the home or because they will no longer need to pay a mortgage. Renters, on the other hand, never get a return on their investment.
Transportation costs make up the second largest spending category for the typical U.S. family. The average annual cost is $9,004, or 14 percent of the overall budget. Transportation costs include everything from the insurance to the vehicle to the fuel to run it. Americans also pay transportation fees on plane tickets, bus and train fare, and even ship fares.
Food is the next most expensive item on the list with an annual average cost of $6,602, or 10 percent of the budget. Households that make less than $15,000 each year still spend about $3,500 annually on food. That averages out to $9.59 a day. Those earning more than $70,000 per year spend about $10,000 on food, or $27.40 a day.
Uncle Sam takes the next biggest chunk of the average household’s yearly budget, scraping off 12 percent to the tune of $7,432 per year in taxes.
Healthcare is another major expense in America. Households spend six percent of their budget on health insurance, prescription drugs, and medical services and supplies.
Other major expenses include the cost of clothing, social security contributions, personal insurance, entertainment, education, and personal care. Of course, these are averages, and it all fluctuates depending on the type of family you have. E.g., if you have children in school, then the amount you spend on education will be higher than the national average.