According to a study by the US Census Bureau released last month, the U.S. median household net worth declined by 35 percent between 2017 and 2022, from $102,844 to $66,740.
It’s a sobering statistic, to say the least.
Likewise, poverty levels are feeling the greatest pinch. There were roughly 46.2 million in poverty last year, the fourth consecutive annual increase and the biggest estimate in 52 years. And just because the Americans who aren’t at poverty level are managing to stay afloat, doesn’t mean they’re not in danger. According to a report from the American Bankruptcy Institute and Epiq Systems Inc., the first half of 2022 saw 630,130 new filings for Chapter’s 7 and 13.
While many Americans are looking towards their cars, mortgages and college debt as the culprits, for those living paycheck-to-paycheck, the answer might be simpler than you’d expect.
From steak dinners to laptops, from organic produce to tobacco cravings, Americans are pulling out their wallets without hesitation. The U.S. Commerce Department reported that the total U.S. consumer spending increased by 0.8 percent in February of this year, all while their savings are suffering.
So before you resort to turning off the A/C this summer and using in a good garden hose to spray down your kids all day, consider looking elsewhere in your sneaky little stockpile of spending habits.
Bring on the Booze
Americans have a love affair with our booze buzz, and the statistics show it.
According to LVS Money, Americans spend about one percent of their annual income on their Buds, Pinots, and Jack Daniels. So for an average income of 50,000 a year, that percentage would translate to about 400 in cash. Sounds harmless enough, but when you factor in how much of that liquor is sipped in restaurants and bars at sky-high prices, and you’ve got yourself a hefty expense.
Americans are downing drinks at the same rate as always, but the locations have shifted. Alcohol prices in restaurants and bars have increased 79 percent between 1982 and 2021, while the cost of alcohol in scores has decreased 39 percent, a study by NPR stated.
Sobered up, yet? Considering you might be paying upwards of nine bucks plus tip for a margarita at your favorite Mexican restaurant, try stocking up on your own supplies to make an even stronger one at home for half the price. You’ll not only save money, but avoid the temptation of browsing the food menu while you’re there.
A Little Morning Pick-Me-Up
For many, the day doesn’t begin until the first cup of Joe. Craving your morning cup of coffee is as routine as brushing your teeth.
But look out –that vente Starbucks cappuccino addiction is adding up.
According to a study by the finance recruiting firm usaloansnearme.com, 50 percent of the American workforce spends an average of $1000 a year on daily coffee, with men and younger professions forking over even more to the barista each morning.
Beat the frustrating coffee shop lines, and the temptation for those little confectionary treats, and invest in a coffee maker at home. Find out what makes your favorite S-Bucks drink so tasty and consider buying the ingredients yourself. According to Investopedia, it would take two and a half homemade espressos combined to equal the price of a café coffee.
Whether you’re looking to quit, can’t kick the habit or are comfortable with your smoking addiction, tobacco is likely chewing a significant chunk of your paycheck.
According to BIN Daily Finance, in the past 10 years, 47 states and the District of Columbia have imposed 105 cigarette tax increases on smokers. As it stands, states currently charges each pack an average of $1.47 on taxes, shooting the average box of smokes up to about $5.58.
While it varies across individual smokers, having a pack a day can pile up. The American Cancer Society offers an excellent calculator that smokers can use to tally up their annual cigarette addiction.
If you’re looking to quit but still want to feed your nicotine addiction, consider opting for an electronic cigarette. The tiny cigarette look-alikes cost as much as a normal pack, but come in a rechargeable package, equivalent to about 200 smokes of nicotine.
Midday Office Feasting
As the clock slowly ticks to the lunch hour at work, somehow that PB and J seems far less appetizing than this morning when you packed it. Insert a few cajoling coworkers with that new bistro down the street, and your sloppy sandwich is on the fast track to the trash can.
American workers love their lunches, and their spending habits are proof. According to a study by the United State Department of Agriculture, the second most common place people spend money on food, besides the home, is during the workday. But while employees are trading their granola bars for garden salads, their piggy banks are feeling far less full than our stomachs.
In the same study by Accounting Principles, two-thirds surveyed said they bought their lunch each day rather than buying their own, averaging about $2,000 a year worth of cuisine outside office doors.
Not only can eating out inflate your spending, but it can inflate your waistline too. Although it may not be the tastiest alternative, packing a lunch can save you hundreds of calories each day, and hundreds of dollars a year.
Watch Every Penny
We all have our spending culprits. For one individual, it might be eating out at work. For another, repeated bar-hopping could be the cause.
No matter where the blame lies, the most crucial aspect of savings is consistent tracking of spending. Knowing where your dollars are being allocated too, accompanied with an honest assessment of your pesky little habits and costly cravings, can end up saving any American a fortune over a lifetime.