The Spending Habits of Americans
article-861

The Spending Habits of Americans

3 Min.

Consumer spending refers to purchasing all final goods and services for personal and household use, including necessities and discretionary items. It accounts for over $17.4 trillion of the American GDP, making up approximately 68%. The analysis of government statistics reveals the financial allocation practices of American citizens.

Basics

Consumer spending is pivotal in driving the U.S. economy, contributing to approximately 68% of its financial activity. Breaking down American expenditures, they can be categorized into two primary segments. The first entails non-negotiable essentials, encompassing vital items like food, medicine, housing, and clothing. The second category comprises discretionary spending, spanning all non-essential products and services.

Providing insight into America's buying behaviors, data from the second quarter of 2023 reveals a substantial total of $14 trillion in consumer expenditures. This data offers valuable insights into the nation's interests, hobbies, indulgences, and vices. Below is a compilation of the top ten discretionary purchases of goods and services, with percentages calculated based on an average annual household income of $87,864 for 2022.

Categories of Consumer Expenditures

Apparel Services and Products

Encompassing dry cleaning, clothing storage, clothing rental, and jewelry/watch repair services. Total Spending: 3%.

Tobacco

Despite the well-documented health risks, tobacco consumption persists among Americans. Smoking is on a gradual decline, while vaping and related products are on the rise. Total Spending: 0.6%.

Entertainment Equipment and Services

A broad category encompassing sports gear, photographic equipment, hunting and fishing supplies, bicycles, boats, and sports-related items. Total Spending: 8.1%.

Alcohol

This category includes all types of alcoholic beverages, including mixed drinks, beer, and wine, with most consumption occurring at home. Total Spending: 1%.

Fees and Admissions

Americans exhibit a strong affinity for movies, concerts, and sporting events, surpassing expenditures on personal care products and services. Total Spending: 1.3%.

Vacation Lodging

Spending on hotels, motels, vacation homes, and weekend getaways increases with household income. Total Spending: 1.4%.

Hobbies, Toys, Pets, and Playground Equipment

A diverse category, with pet-related expenses, including food and veterinary care, constituting the majority of spending. Total Spending: 1.4%.

Television, Radio, and Sound Equipment

Encompassing video games (hardware and software), cable TV connections, and DVD/CD players. Total Spending: 2%.

Gifts

Americans display generosity through substantial annual spending on gifts. Total Spending: 2.2%.

Dining Out

Covers expenses related to eating at restaurants, fast-food establishments, and leisure venues, as well as food from vending machines, mobile vendors, and delivery services. Total Spending: 5.6%.

Non-Discretionary Expenditures

Certain essential expenses during the same period included:

  • Doctors and Dentists: 3.0%.
  • Groceries: 8.6%.
  • Hospitals and Nursing Homes: 1.7%.
  • Rent or Mortgage: 31.5%.
  • Utilities: 5.3%.

Conclusion

The connection between consumer spending and the U.S. economy is undeniable. As one grows, so does the other. Americans' spending choices, particularly the percentage allocated to non-essential items, vividly portray their interests, behaviors, and indulgences. In essence, what the nation purchases becomes a mirror reflecting the economic identity of the typical American consumer.

Consumer Spending
Gross Domestic Product (GDP)
United States of America (USA)
Follow us
Hexn operates under HEXN (CZ) s.r.o. and HEXN Markets LLC. HEXN (CZ) s.r.o. is incorporated in the Czech Republic with the company number 19300662, registered office at Cimburkova 916/8, Žižkov, Praha. HEXN (CZ) s.r.o. is registered as a virtual assets service provider (VASP). HEXN Markets LLC is incorporated in St. Vincent and Grenadines with the company number 2212 LLC 2022, registered office at Beachmont Business Centre, 379, Kingstown, Saint Vincent and the Grenadines