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U N I T E D STAT E S
Here's how different generations
in the US spend their income
Oct 5, 2022
This article is published in collaboration with
Visual Capitalist
.
Gen X spent the most money of any US generation in 2021. Image: Unsplash/Alexander Grey
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Preethi Lodha
Data Analytics and Insights manager , Visual Capitalist
This article is part of:
Centre for the New Economy and Society
The average American spent just over $60,000 a year in 2021, but spending habits vary
significantly between age groups.
Generation X – those born from 1965 to 1980 – spent the most money last year, with
average expenditure of $83,357.
The biggest expense for all age groups is housing, accounting for more than 30% of
annual spending.
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Spending habits vary wildly depending on age. Image: Visual Capitalist.
How Americans Spend Their Money, By
Generation
In 2021, the average American spent just over $60,000 a year. But where does all
their money go? Unsurprisingly, spending habits vary wildly depending on age.
This graphic by Preethi Lodha uses data from the U.S. Bureau of Labor Statistics
to show how average Americans spend their money, and how annual expenses
vary across generations.
A Generational Breakdown of Overall
Spending
Overall in 2021, Gen X (anyone born from 1965 to 1980) spent the most money of
any U.S. generation, with an average annual expenditure of $83,357.
The second biggest spenders are Millennials with an average annual expenditure of $69,061. Image:
Visual Capitalist.
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Gen X has been nicknamed the “sandwich generation” because many members
of this age group are financially supporting both their aging parents as well as
children of their own.
The second biggest spenders are Millennials with an average annual
expenditure of $69,061. Just like Gen X, this generation’s top three spending
categories are housing, healthcare, and personal insurance.
On the opposite end of the spectrum, members of Generation Z are the lowest
spenders with an average of $41,636. per year. Their spending habits are
expected to ramp up, especially considering that in 2022 the oldest Gen Zers are
just 25 and still early in their careers.
Similarities Across Generations
While spending habits vary depending on the age group, there are some
categories that remain fairly consistent across the board.
One of the most consistent spending categories is housing—it’s by the far the
biggest expense for all age groups, accounting for more than 30% of total annual
spending for every generation.
While spending habits vary depending on the age group, housing is one of the most consistent spending
categories. Image: Visual Capitalist.
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Another spending category that’s surprisingly consistent across every
generation is entertainment. All generations spent more than 4% of their total
expenditures on entertainment, but none dedicated more than 5.6%.
All generations spent more than 4% of their total expenditures on entertainment. Image: Visual
Capitalist.
Gen Zers spent the least on entertainment, which could boil down to the types
of entertainment this generation typically enjoys. For instance, a study found
that 51% of respondents aged 13-19 watch videos on Instagram on a weekly
basis, while only 15% watch cable TV.
Differences Across Generations
One category that varies the most between generations and relative needs is
spending on healthcare.
As the table below shows, the Silent Generation spent an average of $7,053 on
healthcare, or 15.8% of their total average spend. Comparatively, Gen Z only
spent $1,354 on average, or 3.3% of their total average spend.
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Gen Z only spent $1,354 on average on healthcare. Image: Visual Capitalist.
However, while the younger generations typically spend less on healthcare,
they’re also less likely to be insured—so those who do get sick could be left with
a hefty bill.
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The views expressed in this article are those of the author alone and not the World Economic Forum.
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