How much will you spend in retirement? For anyone trying to answer that question, here are a couple of hints about the cost of groceries and other household spending.
So far this year, Americans told pollster Gallup that their daily household spending has averaged $70. But that's an average. It doesn't adequately reflect household income differences. People with household income of $90,000 or greater spend more. Those households report that on average they spent $126 so far this year. That's up from $116 in 2009, $118 in 2010 and $121 last year -- about 4 percent each year. Four percent is 1 percentage point more than most experts use to calculate inflation. So keep that in mind when you're doing retirement planning.
Another piece of this survey asked people how much they spent on food in a week, both when they ate at home and when they ate meals out. On average, Americans report spending $151 a week with people ages 50 to 64 spending slightly less -- $148. People 65 and older spend only $103 a week. Again, income made a big difference with upper income households averaging $180 a week.
No matter how much they spend, most people at or near retirement eat at home. People ages 50 to 64 say they eat 78 percent of their meals at home and 9 percent at restaurants. It doesn't change much when they reach 65. At that age, people say they eat 80 percent of their meals at home and 8 percent at restaurants. Even upper-income people aren't big restaurant-goers, eating only 11 percent of their meals out.
Adjusting for inflation, overall spending on food has dropped since 1966 when Americans spent an average of $234 in 2012 dollars. Will food costs fall going forward?
I wouldn’t count on it, especially if those miserable rabbits keep eating my garden.