Many Americans spend a pretty penny each month to keep a roof over their heads, food on the table and a means of transportation. Other items commonly found in household budgets include education, child care, health care, retirement savings and entertainment.

Inflation is cooling down from its 40-year-high in 2022, yet prices are still uncomfortably high, leaving consumers with less money in their budgets for such financial matters as savings and debt repayment. In fact, 63 percent of financially insecure Americans say high inflation is keeping them from being financially comfortable or secure, a recent Bankrate survey found.

You can take stock of how your own budget compares by looking at the average American household budget.

Key household budget statistics

The average household earned $94,003 in 2022 before taxes and spent $72,967, according to a survey by the most recent Consumer Expenditure Survey. The report, published by the U.S. Bureau of Labor Statistics (BLS), lists the average amount spent in various categories. Significant expenditures were housing, transportation and food.

Average 2022 household earning and expenditure statistics
Household earnings $94,003
Total household expenditures $72,967
Housing expenditures $24,298
Transportation expenditures $12,295
Food expenditures $9,343
Increase in household expenditures from 2020 9.2%
Percent of people’s income devoted to living expenses 77.6%
Area of largest expenditure increase Housing (12.7%)

Impact of inflation on expenses

In the aftermath of the COVID-19 pandemic, inflation reached 40-year highs as demand increased thanks to stimulus checks, low interest rates and government spending, while the economy slowed due to shutdowns. Labor costs increased due to a shortage of workers, and consumer demand was high, causing businesses to increase prices.

Although inflation has cooled somewhat, prices remain high, which impacts people’s ability to save. Only 48 percent of U.S. adults say they have enough emergency savings to cover at least three months’ worth of expenses, a Bankrate survey found.

What’s more, more than two-thirds of Americans (68 percent) said that when it comes to saving for unplanned expenses, inflation is causing them to save less, according to the same survey.

Average American household expenses

According to the BLS survey, the largest expenditures were housing and transportation, which comprised 26 percent and 13 percent of people’s pay, respectively. Another big spending category was food, to which 10 percent was devoted.

More than eight in 10 Americans surveyed by in 2023 reported they budgeted their money, a number that’s been trending upward since 2018. The vast majority of budgeters in the survey said the practice got them out of debt or kept them from going into debt.

One way some people afford living expenses without going into debt can be having a side hustle. In fact, 33 percent of Americans who have a side hustle to earn extra money use that income to pay for regular living expenses, a Bankrate survey found.

Cost of living expenses

Income taxes

The average pre-tax income per household in 2022 was $94,003, according to the BLS survey. From 2018 through 2022, married households filing jointly with that income were in a lower tax bracket than single filers, head-of-household filers and married couples filing separately with that income. However, in 2023, those of all four filing statuses will be in the same bracket for that income.

Retirement contributions

The average amount people had saved for retirement in 2023 was $89,300, which was up from $86,869 the previous year, according to Northwestern Mutual’s Planning & Progress Study. Based on this, Americans saved $2,431 on average for retirement from 2022 to 2023.

Data from the Federal Reserve Survey of Consumer Finances (which was last released in 2019) breaks down average retirement savings by age:

Age Average amount saved for retirement
Age 35 and younger $30,170
36-44 $131,950
45-54 $254,720
55-64 $408.420
65-74 $426,070
Age 75 and older $357,920

More than one in five Americans (21 percent) said not saving for retirement early enough was their biggest financial regret, Bankrate’s financial regrets survey found. In fact, less than half of Americans (46 percent) have stock investments in a retirement account or other investment account such a mutual fund, brokerage account or health savings plan (HSA), a Bankrate investing survey found.


Bankrate’s take: 45% of Americans believe it's not likely they'll be able to save enough money to comfortably retire, Bankrate's retirement savings survey found.

Household expenditures

Average cost of utilities

On average, people spend around $329 a month on electricity, natural gas, water, trash and sewer services. This comes out to $3,948 in a year.

The cost for some utilities can fluctuate depending on the season. For instance, people’s natural gas costs are often higher during the months they turn on the heat, whereas their electricity bill is higher when they use the air conditioner. Utility bills often vary by state and by climate.

Ways to save on utility bills include fixing leaky faucets and making sure unused lights are turned off. During the colder months, you can save by turning the heat down when no one is home or by lowering the heat a couple of degrees and wearing extra layers.

Average cost of food

A significant portion of most household budgets is devoted to food. Food was the third largest spending category for Americans in 2022, according to the BLS survey — and it’s been getting more expensive due to inflation. Over the past year, the price of food eaten at home has risen sharply, by 8.4 percent.

Changes in food prices over a 12-month period ending in August 2023, according to the BLS, are as follows:

Food Seasonally adjusted percentage change ending in August 2023
Meats, poultry, fish, and eggs +0.8%
Cereals and bakery products +0.5%
Dairy and related products -0.4%
Fruits and vegetables -0.2%
Nonalcoholic beverages and beveragematerials -0.2%

Nearly half (47 percent) of Americans who say money concerns have a negative impact on their mental health have also said paying for everyday expenses — such as groceries and utilities — has increased concern over the past year, Bankrate’s financial wellness survey found.

Ways to combat rising prices and save money on groceries include making a weekly meal plan and corresponding grocery list, swapping expensive cuts of meat for cheaper options, buying generic products, and never going to the store on an empty stomach.

Average cost of housing

Housing expenses increased 7.4 percent overall in 2022 over the previous year, according to the BLS survey, with the average household spending $24,298 that year on housing. One of the housing costs for homeowners is property taxes.

Total property taxes levied on single-family homes were $340 billion in 2022, which was up 3.6 percent from $328 billion in 2021, according to real estate data firm ATTOM. In turn, 2021’s total was just 1.6 percent from $323 billion in 2020, the data shows.

One-quarter (25 percent) of Americans said factors keeping them from feeling financially secure include house affordability, as well as renting instead of owning a home, Bankrate’s financial freedom survey found.

Of Americans who don’t own a home, 64 percent said it’s due to affordability issues, while the remaining 47 percent said it’s because of the current housing market issues, according to Bankrate’s financial security survey.

Another housing cost that has been on the rise is rent. The average monthly rent bill rose to $2,084 in September 2022. The most affordable metropolitan areas to rent, according to Bankrate data, are:

  • Wichita, Kansas
  • McAllen, Texas
  • Little Rock, Arkansas

The most expensive places to rent are:

  • San Jose, California
  • New York City
  • San Francisco

One way to help brace yourself for possible future rent increases is asking your landlord whether you should expect an increase when your lease is up for renewal. If the answer is yes, knowing this in advance may give you sufficient time to find a new place if you can’t or don’t want to pay the more expensive rent bill.

Additional expenses that affect budgeting

Cost of education

While inflation is down over last year, prices on many goods and services remain uncomfortably high. Inflation significantly affected back-to-school shopping in 2022, as 53 percent of those earning between $50,000 and $99,999 a year said they planned to change their back-to-school spending due to inflation, according to a Bankrate survey. That’s compared with 39 percent of households earning $100,000 or more and 37 percent of those with incomes of less than $50,000.

Bankrate’s survey found that parents seeking back-to-school savings planned to employ the following strategies:

Strategy Percentage of respondents who planned to follow the strategy
Seek more coupons, discounts and sales 54%
Buy fewer school items 45%
Shop cheaper brands 43%
Use items they already own for another year 39%
Obtain used and secondhand items 30%

Families with kids in grade school through high school reported they planned to spend an average of $864 on school items in 2022, according to the National Retail Federation. This amounts to around $15 more per family than was spent in 2021.

Cost of college

According to College Board data, the average price of college tuition was as follows for the 2022-23 school year:

  • Public, in-state, four-year university: $10,950 (an increase of 1.8 percent over 2021-22)
  • Public, out-of-state, four-year university: $28,240 (an increase of 2.2 percent over 2021-22)
  • Public, in-district, two-year college: $3,860 (an increase of 1.6 percent over 2021-22)
  • Private, four-year, nonprofit university: $39,400, (an increase of 3.5% over 2021-22).

In addition to tuition costs, another significant expense for college students is the cost of living. Students living on campus pay an average of $11,520 for room and board at public, four-year institutions, while those living off campus pay an average of $11,365, according to

The average balance in a 529 college savings account was $25,903, as of June 2022, according to BestColleges, which broke down the average amount saved by families based on the child’s age:

  • Age 0-6: $9,196
  • Age 7-12: $14,787
  • Age 13-17: $24,618
  • Age 18 and older: $25,596

Transportation costs

Many Americans own a car, and the costs associated with buying and maintaining a vehicle take up a significant chunk of the average household budget. In March 2023, the average price of a new car was $48,008, while the average price of a used car was $26,213, Bankrate reported.

In addition to the significant cost of buying a car, ongoing expenses of owning a vehicle include insurance, maintenance and gasoline. The current national average price for gas is $3.44 a gallon, according to AAA Gas Prices, which lists the highest-ever recorded average price as $5.02 in June 2022.

The national average cost for gas on Sept. 22, 2023 was $3.86 per gallon, according to AAA, which is 18 cents more than it was a year ago.

More than a third — 38.2 percent — of consumers were financing new vehicles in the second quarter of 2022, and the average monthly payment for new vehicles was $667. For those financing used cars, the average monthly payment was $515.

How to budget

Creating a household budget may seem like a daunting task, but it can help alleviate unnecessary costs throughout the year and keep you on track with saving money, whether you want to add to your savings account, lock in a rate with a CD or aim for a higher yield with a money market account. Starting a budget can be as easy as taking some simple steps:

  1. Determine a budgeting method. The 50/30/20 budgeting rule means separating your income into three portions: Needs, wants and savings. A zero-based budget allocates every dollar of your income to categories, including savings.
  2. Start a worksheet. Whether created on your computer or written on paper, a worksheet is a useful tool for entering line items for money earned and spent.
  3. Add up your income sources. Your sole source of income may be your regular paycheck, or you might have additional earnings from sources like a side hustle or rental property. Add up all the money you’re bringing in after taxes.
  4. Track your spending. Create line items for each category of your spending, including housing, transportation, food, health care, entertainment, savings and debt repayment. Include fixed expenses that remain the same each month and those that fluctuate.
  5. Adjust as needed. If your income or needs change, be sure to modify your budget to reflect that. Updating your spreadsheet regularly will help you stay on track and meet your financial goals.

Frequently Asked Questions

  • Your budget should include all of your spending categories for the month. Include fixed expenses such as housing and insurance, as well as what you expect to pay for variable expenses such as food and gas. Also, be sure to include discretionary spending, such as entertainment. In addition to your spending, also list your income from your primary job, as well as any earnings from a side hustle or other sources.
  • To create a budget, list out your monthly income and expenses. This can be done using a spreadsheet, a budgeting app, or the old-fashioned pen-and-paper method. Figure out what’s left of your income after expenses are covered, which can be put into savings.

    Methods of budgeting include the 50/30/20 budget or the envelope budget method.
  • Every household has unique financial circumstances and needs, but your goal should be to live within your means, which involves spending less than you earn each month. This allows you to add money to savings for an emergency fund or other financial goals. Following a budget is a way to help keep your spending and saving on track.
  • Average household earnings in 2022 were $94,003, while average total expenditures for the year were $72,967, according to the Bureau of Labor Statistics’ Consumer Expenditure Survey. This included an average of $24,298 on housing, $12,295 on transportation and $9,343 on food. More than three-quarters of people’s income (77.6 percent) was devoted to living expenses.