NPR’s blog, Planet Money, has featured a series of about America, covering topics such as What America Does for Work, What America Sells to the Worlds, and What America Owes in Student Loans. A recent entry covered What America Buys.
What America Buys
NPR – Planet Money Blog
April, 5 20120
By Lam Thuy Vo and Jacob Goldstein
This article provides a breakdown of what America buys using government data from the January 2012 CPI Detailed Report. The following illustration was included, showing the major spending categories and some of the interesting smaller categories. Combined, housing makes up the largest portion of our spending at 41%. The second largest category is food, combining to make up 15.3% of our spending.
The article also displays a comparison of spending from December of 1949 to December of 2011. The top two categories are the same, food and housing, but the proportion of those categories has changed significantly. In 1949, food was the top spending category, accounting for 40% of total spending, compared to 2011 where food accounted for 15.3% of spending. Now, housing has taken over as our top spending category, making up 41% of spending. The article also notes that the average house people are buying or renting are twice as big as they were in 1950.
View the full list of expenditure categories starting on page 26 of the CPI Detailed Report. It is interesting to view the subcategories of spending. For transportation, which accounts for 17% of our spending, and the largest subcategories are the amount spent on purchasing new and used cars and trucks and purchasing fuel, and the spending of those two categories is about the same (5.7% and 5.5% respectively). We spend about twice as much on motor vehicle insurance as we do on maintenance and repairs. Looking at the How about what we spend to have fun? Looking at the recreation category, which accounts for 6% of spending, we can see what we spend on fun is largely made up by video and audio entertainment. Second runner up? The amount we spend on our pets! Below is a pie chart breaking down the categories that make up our spending on recreation.
How do your financial planning clients’ purchases compare to the average American?