How Americans Spend Their Money, Broken Out By Generation

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how americans spend their money

When it comes to saving money, we’ve told you about how different generations of Americans are saving and building wealth.

We’ve also told you about the average amount of debt each generation of Americans has.

But how are different generations of Americans spending the money they bring it?

And what categories are they spending that money on?

If you’ve ever wondered how your spending habits stack up to others in your generation, The U.S. Bureau of Labor Statistics released a report that breaks down the spending habits of different generations. The report breaks down the segments of the economy where Americans put their hard-earned cash as of 2021, itemized by generation.

According to the report, the average American spent over $60,000 a year in 2021.

Here’s a breakout of the average amount spent by generation. Gen X spends the most, which tracks considering that people 42 – 57 years old tend to be in peak earning years. Millennials are right behind them, spending about $9,000 more than the $60k mean annually.

Total annual expenditures, by generation:

Boomers (1946 – 1964): $62,204

Generation X (1965 – 1980): $83,357

Millennials (1981 – 1996): $69,061

Generation Z (1996 – onwards): $41,636

There are some interesting observations about the data: Based on the data in the report, all generations are spending over 30% of their average income on housing, with Boomers ($21,273) and Millennials ($24,052) spending the most annually. The biggest segments across the board, regardless of generation, are housing, healthcare, and transportation – which means maybe avocado toast and coffee aren’t the only variables worth considering for why more people can’t afford to buy houses.

There’s also a ton of variance based on age and, presumably, life stage: Generation Z reports that it’s only spending $3871 on transportation a year, while Millennials and Generation X are spending well over $8000 a year.

Generation X reports spending over $10,000 a year on food, while Gen Z is spending a prudent $5,500. In fact, Gen Z  is much better at saving money on entertainment, clothes, and general personal care/ cosmetics.

Millennials are the biggest boozehounds, spending an average of $629 a year on alcohol. Gen X, meanwhile, is spending the most on haircuts, nail salons, and other cosmetic products at $1331.

Below is a breakdown of this data from the Labor Department’s Consumer Expenditure Survey. Visual Capitalist has an excellent chart showing the data – we highly recommend you check it out.

It’s never been easier to set a budget with budget trackers like Mint.com and others out there.

Because it’s fun to compare your habits to others to get a sense of how you can make simple behavioral changes, this should give you a sense of how your own spending habits stack up against your peers.

Housing

Boomers (1946 – 1964): $21,273

Generation X (1965 – 1980): $26,385

Millennials (1981 – 1996): $24,052

Generation Z (1996 – onwards): $15,449

 

Healthcare

Boomers (1946 – 1964): $9,327

Generation X (1965 – 1980): $13,956

Millennials (1981 – 1996): $11,052

Generation Z (1996 – onwards): $7,929

 

Food

Boomers (1946 – 1964): $7,651

Generation X (1965 – 1980): $11,656

Millennials (1981 – 1996): $9,249

Generation Z (1996 – onwards): $5,529

 

Transportation

Boomers (1946 – 1964): $6,594

Generation X (1965 – 1980): $10,388

Millennials (1981 – 1996): $8,483

Generation Z (1996 – onwards): $3,871

 

Cash Contributions

Boomers (1946 – 1964): $6,309

Generation X (1965 – 1980): $5,550

Millennials (1981 – 1996): $4,026

Generation Z (1996 – onwards): $2,097

 

Entertainment

Boomers (1946 – 1964): $3,476

Generation X (1965 – 1980): $4,694

Millennials (1981 – 1996): $3,457

Generation Z (1996 – onwards): $1,693

 

Personal Insurance and Pensions

Boomers (1946 – 1964): $2,876

Generation X (1965 – 1980): $2,747

Millennials (1981 – 1996): $2,135

Generation Z (1996 – onwards): $1,498

 

Apparel and services

Boomers (1946 – 1964): $916

Generation X (1965 – 1980): $2,249

Millennials (1981 – 1996): $1,008

Generation Z (1996 – onwards): $760

 

Personal Care Products and Services

Boomers (1946 – 1964): $732

Generation X (1965 – 1980): $1,331

Millennials (1981 – 1996): $934

Generation Z (1996 – onwards): $496

 

Education

Boomers (1946 – 1964): $703

Generation X (1965 – 1980): $956

Millennials (1981 – 1996): $777

Generation Z (1996 – onwards): $368

 

Alcoholic Beverages

Boomers (1946 – 1964): $561

Generation X (1965 – 1980): $601

Millennials (1981 – 1996): $629

Generation Z (1996 – onwards): $303

 

Reading

Boomers (1946 – 1964): $372

Generation X (1965 – 1980): $375

Millennials (1981 – 1996): $378

Generation Z (1996 – onwards): $210

 

Tobacco Products and Smoking Supplies

Boomers (1946 – 1964): $124

Generation X (1965 – 1980): $106

Millennials (1981 – 1996): $107

Generation Z (1996 – onwards): $79

 

Author
B. Carlisle

Contributing editor at Wealth Gang. An entrepreneur at heart, he's passionate about meaningful ways to leverage technology and social media for business opportunities and side hustles.

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