Want to save money? First you have to know how you spend it. This chart shows a breakdown of how the average American spends their money according to the U.S. Department of Labor. This 2013 study showed the average American taking home about $51,000 a year and the percentages on this chart were how they spent it. You may or may not make $51,000, but chances are your spending percentages are similar.
It is important to look at exactly where your money goes because you may not always realize where it is all going. I think most of us at least occasionally think to ourselves, “I just got paid! Where did all my money go?” It is important to recognize how you spend your money, so you can hopefully spend less and save more.
Transportation is a big category on this chart. The average American spent $9,004 on transportation in 2013. That can include insurance, gas money, car payments and repairs. That being said, sometimes upgrading to a newer vehicle can save you money on transportation costs. If you find that you have an old vehicle that you are constantly having to repair, it might be costing you more in the long run. Gas mileage is also something to consider. Cars from 10 years ago have significantly lower gas mileage and upgrading could save you a lot of money as far as gas goes. Also, you might decide choosing a hybrid car or an electric vehicle is a good idea to cut those gas payments even more.
Food and Entertainment are two more categories where you can save; Food is the third largest category in the chart, and that makes sense because we need food to survive. However, many Americans go out to eat quite frequently and going out to eat can cost a lot more than buying food at the grocery store. You should consider going out to eat less and saving that money for something else you really want.
Entertainment is the same way. Going to the movies may be fun, but it can cost a lot of money. If you wait for the movie to come out on Redbox or Netflix, it can be significantly cheaper. Also, going out for drinks with friends can be a popular form of entertainment, but it might be a better idea to have your friends over; the drinks will be cheaper and you will have a comfortable place to hang out.
To save your money for the things you really want, you first have to know how you spend it. By looking at how the average American spends, you may be able to find ways to cut your own spending. Take some time to think about the ways that you could save!