The numbers don’t lie. They just don’t add up.
In 2024, the average American household spent $78,535.* But inflation didn’t stop when the calendar flipped. While spending data hasn’t caught up yet, costs clearly have. Food prices rose 3% in 2025, outpacing overall inflation. Even with inflation cooling to an annual 2.7%, daily expenses have continued inching upward.
So how are Americans managing to spend nearly $6,545 per month, when the average income doesn’t even clear that bar?
Where the Money Goes
The Consumer Expenditure report outlined household spending across 14 categories. Here’s where the money went:
- Housing: $26,266
- Transportation: $13,318
- Food: $10,169
- Insurance & Pensions: $9,817
- Healthcare: $6,206
Remaining categories include education, entertainment, clothing, personal care, childcare, and miscellaneous expenses.
The data show just how much of the average household budget is eaten up by non-negotiables. These are not luxuries – they are the basic costs of living in America today.
What People Actually Make
According to the U.S. Census Bureau, the mean or average personal income in 2024 was $67,080.** It includes high earners, which pulls the number up, and doesn’t necessarily reflect what most people bring home.
The median personal income, also reported by the Fed, was significantly lower at $45,140. That’s the midpoint – half of individuals earn more, half earn less. This figure is more representative of the “typical” American worker, but still only tells part of the story.
To account for full-time workers specifically, we look to the Bureau of Labor Statistics, which reported median weekly earnings of $1,214 in Q3 2025. On an annualized basis, that’s about $63,128. This number represents people who are consistently working full-time jobs – not part-timers, retirees, or individuals receiving other sources of income like Social Security, Disability, or investment returns. That may help explain the gap between the median personal income and median worker earnings.
What About Households with Two Incomes?
If individuals are earning that much, surely dual-income households have enough room to breathe. Right?
Not exactly.
According to the U.S. Census Bureau’s income report released in September, the median household income in 2024 was $83,730 – up slightly from the prior year but nearly flat compared to pre-pandemic 2019. That’s just $5,196 more than the average household spent that year, leaving les than $450 per month of breathing room. And that’s before savings, emergencies, of financial goals like building a down payment for a home.
So, if it feels like there’s nothing left to build a future with -- it’s because, for many, there really isn’t.
The next question that looms over us is, how do we help make housing both rental and owned, possible for the majority of the American workers? That is the step that MUST be taken. It is the issue we all, the municipal governments, the builders/developers, landowners, lenders, corporations, schools, churches, and civic entities need to work together to make happen. It is past time to get together and make this happen. The time to work for the American families is NOW.
*Bureau of Labor Statistics
**Federal Reserve’s FRED database
