How Americans spend money at every age

What is a typical American budget? It depends—the more we have, the more we spend. The biggest spike in spending comes when our earnings make their first big jump: after we turn 25, when we start to gain traction in our careers. But does age relate to spending in other ways? With some help from the U.S. Bureau of Labor Statistics’ 2015 Consumer Expenditure Survey, we took a look at how different age groups spend. How does your own budget compare?

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Average monthly budgets

$2,733
Under 25

$4,339
25–34

$5,445
35–44

$5,813
45–54

$4,898
55–64

$3,722
65+ 

Age of head of household

Under 25
Just starting out
Average monthly budget $2,733

Average monthly spending includes:
Housing $944
Transportation $527
Food $408
Health care $82
Education $214
Entertainment $113

Young adults are relatively frugal, spending less than their elders do in most categories. One thing they are spending on? Education.

25–34
Millennials
Average monthly budget $4,339
Average monthly spending includes:
Housing $1,525
Transportation $815
Food $553
Health care $231
Education $94
Entertainment $206

As people settle into jobs, they can spend more and also start paying down debt and saving.

How housing costs change as we age

$944
Under 25

$1,525
25–34

$1,850
35–44

$1,763
45–54

$1,516
55–64

$1,294
65+

While housing costs vary a lot over a lifetime, this amount as a percentage of average monthly household spending is fairly consistent, ranging from 30–35%.

35–44
Adulthood
Average monthly budget $5,445

Average monthly spending includes:
Housing $1,850
Transportation $912
Food $737
Health care $323
Education $98
Entertainment $266

Housing and food costs are highest during the marriage-and-mortgage years, especially for those who have children.

45–54
Middle age
Average monthly budget $5,813

Average monthly spending includes:
Housing $1,763
Transportation $982
Food $701
Health care $389
Education $222
Entertainment $276

Transportation costs top out as teen children start driving. Education costs spike when they head off to college.

Health costs keep going up

$82
Under 25

$231
25–34

$323
35–44

$389
45–54

$426
55–64

$480
65+

We use more medical care and prescription drugs as we age, so health care spending increases even as our incomes decline.

55–64
Empty nests
Average monthly budget $4,898

Average monthly spending includes:
Housing $1,516
Transportation $835
Food $583
Health care $426
Education $97
Entertainment $277

Income drops off after 55, but so do food and transportation costs, as people start leaving the workforce.

65+
Golden years
Average monthly budget $3,722

Average monthly spending includes:
Housing $1,294
Transportation $571
Food $459
Health care $480
Education $22
Entertainment $205

Older Americans typically downsize their spending across all categories except health care.

No matter how your spending stacks up or what age you are, it’s important to plan ahead for your financial goals (Link: https://bettermoneyhabits.bankofamerica.com/en/saving-budgeting/learning-to-save) such as a home purchase, your child’s education or your retirement.

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The material provided on this website is for informational use only and is not intended for financial or investment advice. Bank of America and/or its affiliates, and Khan Academy, assume no liability for any loss or damage resulting from one’s reliance on the material provided. Please also note that such material is not updated regularly and that some of the information may not therefore be current. Consult with your own financial professional when making decisions regarding your financial or investment options.

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