People (Unknowingly) Spend 70% of Their Money on These 3 Things
Between rent, food, and transportation, I've nearly mastered the art of spending my paycheque as fast as possible. But according to Business Insider, I'm definitely not alone in this reality. The site referenced the personal finance blog Millennial Money, founded by 30-something self-made millionaire Grant Sabatier, who writes that on average, Americans spend 70% of their money on those three expenses. Not sure about you, but I think the Australian stats would not be far off...
This figure is based on a Bureau of Labor Statistics release on consumer expenses, which outlined the average income and expenditures from 2013 through 2015. It found that the typical person making U.S. $55,978 a year spends roughly $7000 on food, $18,500 on housing, and $9500 on transportation, the three highest expenses on the list.
While all three purchases are life necessities, they can be cut down. Saving up for a down payment on a home, for example, is a wiser long-term investment than paying rent, while transportation costs can be halved by living in a place with public trains or buses (and there's always biking).
But if there's anything you can realistically cut back on, it's the food category. A recent Bankrate survey actually found that the average 20- to 30-something goes out to eat five times a week, whether that's grabbing lunch during work, sitting down for a meal after hours, or ordering Uber Eats on a lazy Sunday. Grocery shopping and preparing your own meals every day are surefire ways to save some money (not to mention calories—full-service restaurants are actually just as unhealthy as fast-food joints).
Next up: the genius trick that will help you avoid overspending at all costs.