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Household Budget Statistics

Data & Guides Money Household Budget Statistics

Budgeting plays an essential role in financial stability, but managing income and expenses could be a source of worry for some.

The average U.S. household spends $77,280 a year, with costs increasing across major categories like housing, food, and transportation. [1] Bureau of Labor Statistics. “Consumer Expenditures in 2023” https://www.bls.gov/opub/reports/consumer-expenditures/2023

To better understand how households manage their finances, a survey conducted on behalf of Self Financial asked 1,164 adults about their budgeting habits, spending priorities, and the emotional impact it has on their lives.

Key statistics

Contents

The average American household budget

According to the Bureau of Labor Statistics (BLS) Consumer Expenditure Survey, the average U.S. household spent $77,280 in 2023, reflecting a 5.9% rise from the previous year. The BLS also reports that the average household income before tax was $101,805 in 2023, an 8.3% increase from the prior year. [1] Bureau of Labor Statistics. “Consumer Expenditures in 2023” https://www.bls.gov/opub/reports/consumer-expenditures/2023

Spending rose across most major categories, including housing, transportation, food, and personal insurance, indicating that many households face higher costs in essential areas.

Housing costs

Housing remains the largest household expenditure, making up 32.9% of total spending reported in 2023. ​This includes all housing-related expenses such as rent, mortgage payments, utilities, energy, home maintenance, lodging, furniture, and appliances. [1] Bureau of Labor Statistics. “Consumer Expenditures in 2023” https://www.bls.gov/opub/reports/consumer-expenditures/2023 According to a survey conducted on behalf of Self Financial, nearly half of respondents (49.05%) spend most of their household budget on either mortgage (27.0%) or rent payments (22.0%). A 2023 study on behalf of Self found that the average American can expect to pay $333,065 over a lifetime of renting.

In addition to these costs, housing maintenance also represents a financial burden with 12.7% of those surveyed about their household budget citing it as their largest household expense outside of rent and mortgage payments – highlighting the ongoing costs of homeownership and upkeep.

For homeowners, housing expenses have risen due to interest rate changes. Mortgage rates in 2023 started at an average of 6.27% in January and peaked at 7.62% in October, with an average of 7.3% for a 30-year fixed-rate mortgage in the fourth quarter of 2023 – the highest the rate has been since the fourth quarter of 2000 [1] Bureau of Labor Statistics. “Consumer Expenditures in 2023” https://www.bls.gov/opub/reports/consumer-expenditures/2023

Utilities and energy costs alone make up 6% of overall housing expenditure – covering electricity, gas, water, and trash. [1] Bureau of Labor Statistics. “Consumer Expenditures in 2023” https://www.bls.gov/opub/reports/consumer-expenditures/2023

Food, transportation, and healthcare expenses

Food, transportation, and healthcare are among the most significant costs in household budgets.

Food expenses totaled $9,985 per household on average, accounting for 12.9% of annual expenditures, including the cost of both groceries ($6,053) and dining out ($3,933). [1] Bureau of Labor Statistics. “Consumer Expenditures in 2023” https://www.bls.gov/opub/reports/consumer-expenditures/2023 According to the survey, 24.7% of respondents spent most of their food budget on dining out (restaurants, takeaways, and coffee shops) while 59.3% spent the majority on cooking at home (groceries and meal prep’), with the remainder (16.0%) reporting an even split.

Transportation remained another high-cost category, consuming 17.0% of total spending – with households spending an average of $13,174 in 2023. This includes expenses on vehicles, fuel, train tickets, and other modes of transport.

Healthcare costs also saw an increase in 2023 with households spending an average of $6,159 compared to $5,850 in 2022. [1] Bureau of Labor Statistics. “Consumer Expenditures in 2023” https://www.bls.gov/opub/reports/consumer-expenditures/2023 [2] Bureau of Labor Statistics. “Average price data (in U.S. dollars), selected items” https://www.bls.gov/charts/consumer-price-index/consumer-price-index-average-price-data.htm

Lifestyle and leisure spending

While essential costs such as housing and food take up much of the average household budget, there’s an average of $3,635 spent on entertainment costs per year, according to the latest Bureau of Labor Statistics (BLS) Consumer Expenditure Survey.

Other lifestyle-related costs include $1,945 on apparel and services, and $951 on personal care products and services, such as haircuts, salon treatments, and toiletries. Alcoholic beverages also accounted for $537 in spending on average. [1] Bureau of Labor Statistics. “Consumer Expenditures in 2023” https://www.bls.gov/opub/reports/consumer-expenditures/2023

12.2% have no money left over after essentials

In the survey conducted on behalf of Self Financial, respondents were asked how much money they had after paying for key essentials including housing, food, utilities, and debt. This gives us an idea of how much money households have left over after covering their necessary payments.

Survey results showed that 12.2% of respondents reported having no money left after covering essentials and 28.1% had between $1-$250 each month. A significant portion of households (29.4%) with an income of $100,000 and over have the most money left over, with a $2,001 or more after covering essential expenses. While almost half of the households (47.8%) earning less than $20,000 a year break even or run out of money by the end of the month.

How households budget and prioritize their spending

Households take different approaches when managing their finances. Over one-third

11.5% of households never create a budget

Survey results show that 11.5% of households never create a monthly budget. Budgeting habits vary by income, with those at the highest and lowest ends of the income spectrum being the most likely to never budget. Among those earning under $20,000, 58.6% report sometimes creating a monthly budget, 24.3% say they always do, and 17.1% never budget. In comparison, nearly a quarter (24.6%) of those earning over $100,000 never create a monthly budget – the highest number of non-budgeters across all income levels.

More than two in three households include savings in their budget

Respondents were asked whether or not they include savings as part of their budget. While costs related to housing dominate most budgets, it’s clear that there’s still an emphasis on savings with two-thirds (66%) of those surveyed including savings as part of their budget. A third of respondents (33%) do not budget money for savings.

Millennials are most likely to budget for savings

Saving habits across different age groups vary, with millennials (29-44) being the most likely to consider saving, with 71% saying they include savings as part of their budget. In contrast, Gen X (45-60) are the least likely, with just over half (52%) setting aside money specifically for savings. The majority of older generations account for savings as part of their budget, with baby boomers (61-70) and the silent generation (71+) saving at a similar rate (61% and 66.7%, respectively).

Men are more likely to budget for savings

Men are more conscious of budgeting for their savings, according to the survey. The majority, 79.2%, of men include savings in their budget, compared to 56.3% of women.

Zero-based budgeting is the most popular method

Of those that use a budgeting method, zero-based budgeting (ZBB) led the way. According to the survey data, a third of households (33.3%) use this method, where every dollar is allocated to a specific expense, savings or other outgoing.

Budgeting methods used by respondent Percentage of respondents
Zero-Based Budgeting (every dollar is assigned to an expense) 33.33%
50/30/20 Rule (percentage spent on needs, wants and savings) 25.59%
Envelope System (separate cash physically or via an app or 'banking pot' system) 19.64%
Pay Yourself First (pay savings before expenses) 14.25%
Other 7.18%

Among income groups, those earning between $20,001 and $40,000 were the only group that did not favor ZBB. Instead, they preferred the 50/30/20 rule, which allocates 50% of income to needs, 30% to wants, and 20% to savings.

Other budgeting methods used included the Envelope System, a cash-based method with spending categories, each with an assigned envelope. Cash is budgeted and placed into each envelope, once an envelope is empty, no more spending is allowed in that category. Another budgeting option, the Pay Yourself First method, is when saving contributions are prioritized and put away before accounting for expenses.

How different generations budget

Different generations budget differently with some always budgeting, while others sometimes, or never budget.

As part of the survey, respondents were asked if they create a monthly household budget, with the choice of always, sometimes, and never. Here’s a look at what percentage of each generation creates a budget.

Generation Always budget Sometimes budget Never budget
Gen Z 31% 55.9% 13.1%
Millennials 35.6% 55.7% 8.7%
Gen X 33.3% 46.2% 20.5%
Baby boomers 41.5% 39.0% 19.5%
Silent generation 33.3% 46.7% 20.0%

Baby boomers are the most likely to budget, with 41.5% reporting they always create a monthly budget – the highest of any generation. Millennials follow closely behind, with 35.6% saying they always budget.

Gen Z has the lowest percentage of respondents who always budget (31%), but the highest rate of “sometimes” budgeting. This suggests that while they may not budget consistently, many younger adults are at least attempting to plan their outgoings on a regular basis.

Millennials were most likely to budget in some form, with 91.3% saying that they always or sometimes create a monthly budget, and 8.7% saying they never do.

In general, “sometimes” was the most common response across all generations, but the differences in those that answered “always” and “never” help highlight which generations are most consistent and which are more likely to skip budgeting entirely.

How couples budget together

Staying on top of a household budget can be challenging, and while most households take some approach to budgeting, more than one in nine (11.5%) do not budget at all, according to the survey data. For couples, financial planning adds another layer of complexity, requiring collaboration in managing income and expenses.

The most common approach among couples is to combine their income and budget together, with 37.9% doing so, while many others (23.5%) opt to split bills but manage personal expenses separately. Over one in ten (10.8%) couples manage their budget completely separately from their partner.

How couples manage their budget together Percentage of respondents
We combine income and budget together 37.9%
We split bills but manage personal expenses separately 23.5%
We keep finances separate but discuss budgeting 21.7%
I manage my budget separately to my partner 10.8%
We don't talk about budgeting 6.1%

Gen Z are the least likely to combine income with a partner and are more likely to keep finances separate while discussing budgeting. Baby boomer couples (61-70) are the most financially integrated, with 61.5% combining both their income and budget together.

The emotional side of budgeting and spending

Household budgeting isn’t just about numbers – it can also be also tied to emotional decisions and other outside factors.

Regardless of what contributes to how people spend, based on survey responses it’s clear that creating a budget can be a stressful task for many. The survey data highlights that financial planning could be a concern for most, with nearly all respondents expressing some level of worry around budgeting.

91.8% of people worry about budgeting

According to the survey data, an overwhelming 91.8% of respondents are worried about budgeting, with 37.8% of respondents across all age groups and genders expressing that they always worry and 54% saying they sometimes worry about planning their finances.

Gen Z respondents were most likely to report budgeting concerns, with 81.4% indicating that they worry to some extent (expressing that they always or sometimes worry about budgeting) and only 8.6% expressing no worry around budgeting.

Overall, of respondents across all age groups who report worrying about budgeting, 70.7% added that their concerns have increased over the past year. The rise in financial anxiety aligns with rising costs of living and inflation, which have impacted household expenses across food and housing. [1] Bureau of Labor Statistics. “Consumer Expenditures in 2023” https://www.bls.gov/opub/reports/consumer-expenditures/2023

Over a quarter of people prioritize entertainment over savings

When asked which expense they would cut first out of entertainment (eating out, the movies, bars, and hobbies), savings, or personal care (hair, nails, gym membership, etc.) – over a quarter, 28% of respondents chose to cut savings over entertainment or personal care.

More than half of women (61.6%) said that they’d cut entertainment out of their budget over personal care and savings. A stark contrast to men, who favored personal care over entertainment or savings – with 54.5% choosing to cut out entertainment.

Two in five (40%) of those surveyed overall spend at least half of their food budget on dining out or takeaways, indicating the potential for ways to save money and cut costs.

What factors influence a person’s spending

Over 70% of survey respondents said that they felt guilt over spending decisions. Despite most households worrying about their budget, they’re still spending money on things they may regret, this could be down to numerous factors.

Of those surveyed, most attributed sales and discounts, 56.8% of respondents cited this as the biggest nudge towards making a purchase. Other common factors included needs over wants and convenience. Almost half (49.6%) of the respondents said that convenience impacted their decision to spend money.

Spending influences Percentage of respondents
Sales and discounts 56.8%
Convenience 49.6%
Needs over wants 50.1%
Emotional state 36.8%
Social pressure 7.6%
None of the above 2.1%

Data note: Respondents could choose more than one answer.

How budgeting stress impacts daily life

Money worries can affect people in different ways, with over 90% of respondents reporting that it has had at least one impact on their daily lives.

The survey found that causing or increasing stress and anxiety wasn’t uncommon with more than half experiencing one or both symptoms from worries around budgeting. The majority, 62.3%, of respondents said that budgeting contributed to their stress levels, 51.1% reported that it caused or increased anxiety, and 30.3% experienced difficulty sleeping as a result.

Budgeting impacts Percentage of respondents
Caused or increased stress 62.3%
Caused or increased anxiety 51.1%
Difficulty sleeping 30.3%
Reduced ability to work or focus 22.8%
I don’t worry about budgeting 8.8%
Strained relationships 33.0%
None of the above 9.1%

This highlights the impact that budgeting can have on people’s lives and how it varies from one person to the next.

Other answers available included other impacts such as strained relations, reduced ability to work or focus, they don’t worry about budgeting, or none of the previous.

Data note: Respondents could choose more than one answer.

Methodology

A survey was carried out on behalf of Self Financial in February 2025 which asked 1,164 adults about their household budgeting and spending habits, including income allocation, savings behavior, and worries around budgeting. The survey captured a cross-section of respondents by age, gender, and income.

The demographic of respondents were:

Gender

Age

Level of income

Sources

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