Are you looking forward to comparing your annual spending with that of an American Family? We are here to give you an overview of the total spending that an American family does in a year based on the sectors that occupy a major crunch of total expenses.
“On Average, an American Family Spends $57,311+ According to BLS“
Here are the Main Sectors of Expenses
Housing (The Most Expensive One in the List)
One cannot deny that housing happens to be one major expense in everybody’s pocket all over the world. Even an average American family is not spared from the rising housing and apartment rates. It is almost double than of any other expense that one incurs.
If one settles in rented apartments too, the rent of the space is too high that it indulges the major part of the family income.
If one plans to buy his or her own house along with its insurance, it is imaginable that how much can the spending be!
The good thing is that loans are available. While at the same time there are high-interest rates that one needs to pay along.
If you go by the statistical data which is available at various survey sites, an average American family spends $10k to $20k per year on housing- rent, repayment of the loan!
Coming to the maintenance of the house, again it is a major expense to consider. There is a 9% rise in the spending over maintenance of property by the people who have not got their house covered under some insurance plan.
Unexpected natural events or irregular maintenance leads to bigger collateral damages such as roof leveling, wallpaper scaling, etc that need to be repaired from time to time.
Insurance policies help in covering the major spending over the annual maintenance of your house.
If you ask an American what is his major pocket burner in the year he may impromptu name the transportation! Everyone- whether in metro cities or the countryside need to travel frequently to places causing- a lot of fuel, a lot of much maintenance, and other significant vehicle-based expenses to incur.
Given the need for time and rising costs of insurance policies, transportation becomes a costly affair.
American families go on to spend as much as between $3000 to $9000 on transportation given to the size of the family and the age of the members. If every member of the family is driving or going out for the daily purpose (school, college) the expenses are on the higher side.
With the challenging lifestyle full of stress and anxieties the health often takes the back seat. However, raising awareness about various healthy dietary practices and a lot of information about work out regimes has given rise to better health in various cases.
Still, healthcare needs keep on occurring once or the other in a family. Especially in a family with grandparents and the small children where immunity is always on the lower side health care expenses are always on a roll!
As per the survey, an American family ends up spending somewhere between $300 to $5000 annually on healthcare facilities again varying as per the family size and age of its members.
There is one interesting thing to notice here, if you own health insurance for every member of the family, the spending gets reduced to a large extent.
In fact for unexpected bigger health issues that cannot be considered in the statistical surveys the health insurance proves out to be the lifeline for the families. A little spending on health insurance goes a long way.
The Vacation Mode
Americans are born with the spirit to travel! They go around the world without having to worry about what they may save in terms of money. The best thing about traveling is the memories that we make while side effects are that we generally end up spending more than our budget.
The budget that the average American family spends on traveling and vacation breaks is varying in every case to a large extent.
What is more defined here is that Americans always keep a chunk of their income aside for spending vacations through travel- somewhere in between $500 to $10000.
A regular traveler always covers himself with Travel insurance clauses to compensate for any damage to luggage during traveling.
FMCG and Daily Lifestyle Needs
The requirement of FMCG (fast-moving consumer goods) in households is an essential need. It doesn’t occupy one of the major portions of the expenses though but needs to be considered in regular spending parameters.
At the same time, the fulfillment of their daily lifestyle needs and status quo is something that may cause a lot of expenses varying on personal choices.
Other than buying expensive gadgets, that the Americans are very fond of in general, there are memberships of clubs, weekend entertainments, family get together, etc that may cause a blow to the family budget almost every month.
In general, an American family spends between $400 to $5000 per year on the above needs.
Retirement planning and personal insurance have become a necessity by law and by nature. People are always on a lookout for some cheaper insurance plans so that they can save the maximum for their retirement by earning high rates of interest.
However, buying several types of insurance policies is not feasible in every budget.
Therefore most of the far-sighted American families invest in “family insurance” schemes or “joint insurance” policies. These policies may appear higher in price than a single policy but make you save quantifiable when you buy 2 separate policies for the same reason.
The spending of an average American family has been on the higher side in general as compared to the other countries. Saving the money for the future becomes a challenge when the expenses are so fortifying the spending budget.
We have been talking about the insurance policies that can be claimed for most of the above-mentioned expenses. If planned in a proper manner the insurance policies can be helpful in managing the budget in most optimal ways. An advance planning of the basic necessities needs to be done in order to make the expenses fall within the budget.
The data we gathered was mostly about the average outcomes drawn on the basis of our findings.