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How Americans Make and Spend Their Money, by Age Group

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If you’re like most people, your income and spending changes significantly as you get older.

In the most common career trajectory, earlier years coincide with a lower salary as skills and experience grow. Then, peak earning years are achieved in late adulthood, and eventually retirement comes onto the horizon.

Is this typical earnings arc supported by data?

Income and Spending, by Age

The data visualizations in today’s post come to us from Engaging Data and they use Sankey diagrams to display data from the Bureau of Labor Statistics (BLS) showing differences in how various age groups in America earn and spend their money.

The four charts below will show household data based on the age of the primary resident:

  1. Less than 25 years old (Very early career)
  2. Between 25-34 years old (Early career)
  3. Between 45-54 years old (Peak earning and spending)
  4. More than 75 years old (Retirement)
    1. Let’s take a look at the collection of data, to see how it shakes out.

      Less than 25 Years Old – $31,102 in spending (94.6%% of total income)

      These contain an average of 1.9 people (1.3 income earners, 0.3 children, and 0.0 seniors)
      Less than 25 Years Old

      For the average household with a primary resident under 25 years old, total income is $32,893.

      The biggest expense is housing (24.3% of spending), followed by vehicles (10.8%), gas and insurance (9.3%), food at home (7.7%), and dining out (7.6%). For this younger cohort, education is also a significant expense at $2,333 per year (7.5% of spending).

      Between 25-34 Years – $48,928 in spending (70.8% of total income)

      These contain an average of 2.8 people (1.5 income earners, 1.0 children, and 0.0 seniors)
      Between 25-34 Years Old

      In this age range, earning potential starts to rapidly expand with experience – and households make double that of the previous category (Under 25 years old).

      Housing remains the biggest expense (25.9% of spending), followed by gas and insurance (9.2%), household expenses (8.2%), food at home (8.1%), and then vehicles (8.1%).

      Between 45-54 Years – $64,781 in spending (64.6% of total income)

      These contain an average of 2.8 people (1.7 income earners, 0.7 children, and 0.1 seniors)
      Between 45-54 Years Old

      This age range is notable because it has both the highest income and the highest spending. It also represents a time of peak savings, with the average household stashing away $19,159 per year.

      Expenses are similar to the previous category. Housing is the biggest expense (22.0%), followed by gas and insurance (9.0%), food at home (7.9%), vehicles (7.9%), and household expenses (6.7%).

      Over 75 Years Old – $40,211 in spending (95.6% of total income)

      These contain an average of 2.6 people (0.2 income earners, 0.0 children, and 1.4 seniors)
      Over 75 Years Old

      Not surprisingly, here we see salary contributing just $7,891 per year to total income, with social security supplementing income with $25,057 per year.

      For this older segment, health insurance (8.2%) jumps up to become the second most important expense. Meanwhile, driving and housing both drop in their respective allocations.

      The Typical Earning Arc?

      The data confirms that conventional wisdom around the typical earning trajectory for Americans seems pretty accurate.

      For more breakdowns, check out how Americans spend their money based on income levels or education levels.

      Did you find any surprising anomalies in the numbers?

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Mapped: The Income Needed to Live Comfortably in Every U.S. State

A single adult needs to make at least $116k annually to live comfortably in Massachusetts.

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This map illustrates the income necessary for an individual to maintain a comfortable lifestyle in each state.

The Income Needed to Live Comfortably in Every U.S. State

This was originally posted on our Voronoi app. Download the app for free on iOS or Android and discover incredible data-driven charts from a variety of trusted sources.

Individuals in the top 11 most expensive states in the U.S. need an annual income exceeding $100,000 to live comfortably.

This map shows how much income single adults need to live comfortably in each U.S. state. SmartAsset calculated the income needed using the cost of necessities sourced from the MIT Living Wage Calculator, last updated on Feb. 14, 2024.

In this case, “comfortable” was defined as the annual income required to cover a 50/30/20 budget, allocating 50% of earnings to necessities such as housing and utility costs, 30% to discretionary spending, and 20% to savings or investments.

Massachusetts Ranks First

Massachusetts is the most expensive state to live comfortably in. A single adult needs to make at least $116,022 annually or $55.78 per hour.

RankStateSalary needed for a single working adult
1Massachusetts$116,022
2Hawaii$113,693
3California$113,651
4New York$111,738
5Washington$106,496
6Colorado$103,293
7New Jersey$103,002
8Maryland$102,918
9Oregon$101,088
10Rhode Island$100,838
11Connecticut$100,381
12Virginia$99,965
13New Hampshire$98,093
14Arizona$97,344
15Georgia$96,886
16Alaska$96,762
17Vermont$95,763
18Illinois$95,098
19Delaware$94,141
20Utah$93,683
21Nevada$93,434
22Florida$93,309
23Maine$91,686
24Pennsylvania$91,312
25North Carolina$89,690
26Minnesota$89,232
27Idaho$88,733
28South Carolina$88,317
29Wyoming$87,651
30Texas$87,027
31Tennessee$86,403
32Indiana$85,030
33Montana$84,739
34Kansas$84,656
35Michigan$84,365
36Wisconsin$84,115
37Missouri$84,032
38Alabama$83,824
39Nebraska$83,699
40New Mexico$83,616
41Iowa$83,366
42Mississippi$82,742
43Louisiana$82,451
44South Dakota$81,453
45Ohio$80,704
45Kentucky$80,704
47North Dakota$80,538
48Oklahoma$80,413
49Arkansas$79,456
50West Virginia$78,790

West Virginia is the least expensive for a single adult, who only needs to make an estimated $37.88 per hour, or $78,790 annually.

To live comfortably on your own in the top five states, a person would need to earn nearly double the typical income for single earners, as the U.S. median income for single, full-time workers is around $60,000, according to Labor Bureau data.

If you enjoyed this post, be sure to check out this graphic, which ranks the income a family needs to live comfortably in every U.S. state.

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