Spending habits often mirror the time you grew up in and the stage of life you’re in now. According to the latest Consumer Expenditure Survey from the Bureau of Labor Statistics, households led by Americans aged 35 to 54 spent about $93,000 in 2023. Those under age 35 averaged under $63,000, while people age 65 and older spent roughly $60,000.
Fresh 2025 surveys point to new trends. McKinsey notes Gen Z’s spending is growing nearly twice as fast as earlier generations. Deloitte’s tracker shows many mid-career families cutting back on discretionary purchases. NIQ highlights older adults shifting more toward wellness and travel as housing, health care, and debt costs change.
With prices staying high, generational budgets continue to shift. Keep reading to see where each age group is directing its money today and what factors may influence your own spending in the near future.
📌 Also read: How Much Money Americans Save Each Year (by Age, Income, and State)
Average Spending by Age Group (At-a-Glance)
Spending looks different across generations, and the latest data highlights just how wide the gaps can be. Below are estimated average annual expenditures for 2023 by generation, based on the Bureau of Labor Statistics’ Consumer Expenditure Survey.
📌 Source: Bureau of Labor Statistics, Consumer Expenditure Survey “Generation of Reference Person” Table (2023). Primary references: Tables 12 and 13 (age of reference person, generation of reference person, homeownership, earners, vehicles, and average expenditure levels). Healthcare data for age 65+ from BLS CE (via FRED).
Gen Z & Younger Millennials (Under 35)
Households led by people under age 35 are often just starting out. They typically have fewer earners, smaller household sizes, lower homeownership rates, and shorter credit histories. These traits keep total spending below older age groups even as rent and “out-of-home” costs take up more of the budget.
Key Patterns
✅ Homeownership is limited: about 15% for under age 25 and 42% for ages 25–34.
✅ Vehicle ownership is lighter: roughly 1.2–1.5 vehicles per household.
✅ More dollars go to rent, public transit or ride-hailing, food away from home, and digital subscriptions.
Healthcare spending is lower in absolute dollars due to younger age and employer plan mix.
📝 Note: Because housing and transportation costs make up a large share, this group is more sensitive to price changes in these areas.
✏️ Hypothetical Example:
A 27-year-old renter with one car and a streaming habit may spend less on healthcare but feel every uptick in rent or transit fares.
Life stage dynamics like relocations, forming households, and entry-level pay help explain why total spending trails older groups despite strong urban consumption patterns.
Mid-Career Millennials & Gen X (35–54)
This stage tends to be the highest-spending period of life. Households are more established, incomes are typically higher, and family responsibilities peak.
Key Patterns
✅ Two earners are most common: about 1.7–1.9 per household.
✅ Homeownership rises to around 64% at ages 35–44 and 70% at ages 45–54.
✅ Vehicle counts reach 1.9–2.2 per household.
✅ Children per household peak at about 1.5 for ages 35–44.
These structural factors push annual outlays to the top of the distribution: mortgages or higher rents, childcare and education, transportation (auto purchases, insurance, fuel), and full household operations like utilities, furnishings, and maintenance. Spending also broadens to include work travel, kids’ activities, and multiple layers of insurance.
📝 Note: Even with stronger earnings, higher interest costs and frequent replacement cycles (cars, appliances, renovations) can keep cash flowing out, making budgets feel tight.
✏️ Hypothetical Example: A 42-year-old couple with two children, two cars, and a mortgage may earn more than in their 20s but see most of it allocated to housing, transportation, and family costs.
BLS data places Gen X at the top of average expenditures among generations in the latest full-year tables.
Boomers & Silent Generation (55+)
As full-time work slows or ends, total spending tends to decline, but the mix shifts significantly.
Key Patterns
✅ Homeownership reaches its highest point: about 75–78%.
✅ Earners per household drop to about 0.5 at age 65+.
✅ Vehicles edge down from about 1.8 to 1.5 per household.
✅ Healthcare spending rises: the 65+ group spent about $8,027 on healthcare in 2023, up from $7,540 in 2022.
Many households redirect funds toward travel, gifting, and home projects, often financed by pensions, Social Security, and asset withdrawals instead of wages. Work-related and child-related spending declines, while medical insurance and out-of-pocket costs take a larger share.
📝 Note: Even though total spending is lower than mid-career peers, budgets at this stage are more exposed to medical inflation and service costs. Housing costs may moderate for owners who paid down or paid off their mortgages.
✏️ Hypothetical Example: A retired couple with no mortgage but higher out-of-pocket medical bills may spend less overall than when they were working, yet see a larger slice of their budget go to healthcare and travel.
Category Shifts That Come with Age
How people spend their money doesn’t stay static. Even as incomes rise, the mix of expenses shifts with life stages, household size, and lifestyle changes. Some costs, like housing and groceries, remain significant at every age but gradually take up a different share of the budget over time.
Recent Bureau of Labor Statistics data shows just how these shifts play out. From 2020 through 2023, housing continued to dominate household spending at 32.9% in 2023, but its share has edged down for four consecutive years.
📌 Source: Bureau of Labor Statistics, Consumer Expenditure Survey
Transportation climbed to 17.0% and food reached 12.9%, while personal insurance and pensions accounted for 12.4% and healthcare 8.0%. Altogether, these five essentials consumed 83.2 cents of every consumer dollar, leaving only 16.8 cents for discretionary items like entertainment, apparel, or travel.
Housing, Utilities & Food-at-Home
Housing continues to dominate household spending, averaging about one-third of budgets in 2023 (32.9%).
✅ Under 35: Lower homeownership rates and heavier reliance on rent make monthly housing costs feel larger. Utilities can also run high on a per-square-foot basis in smaller or older rentals.
✅ Midlife and Later: Mortgage pay-downs or full ownership reduce principal payments, but property taxes, insurance, and maintenance remain ongoing expenses. Housing’s share of the budget often falls even if upkeep dollars stay steady.
Groceries anchor spending at every age. Older households usually devote a larger proportion of their food budgets to at-home meals. Younger renters lean more on convenience foods and prepared items. Both groups continue to face elevated supermarket prices following the 2022 inflation surge.
📝 Note: Rent-heavy budgets often leave less room for saving, while owners face lumpy but predictable upkeep costs.
Transportation, Entertainment & Dining-Out
Transportation is the second-largest expense nationwide. Its share and mix vary sharply by age.
✅ Peak Spending Years (35–54): Families often operate multiple vehicles, replace cars more frequently, and insure teen drivers. These factors push vehicle purchase and insurance costs to their highest point.
✅ Younger Adults: Public and “other” transportation (mass transit, airlines, taxis, ride-share) plays a larger role for those who delay car ownership or live in cities.
Entertainment and dining out also follow life-stage patterns. Mid-career households spend the most dollars on meals away from home, balancing work schedules and family activities. Older households dine out less often but may favor higher-service venues. USDA data show a national shift back toward restaurants since 2023, reflecting renewed demand for away-from-home meals.
📝 Note: Vehicle replacement cycles, insurance, and dining out combined can quietly push total spending to the top of the distribution for mid-career households.
Health Care, Insurance & Debt Service
Health-care costs rise steadily with age, both in dollars and as a share of the household budget.
✅ Rising Health-Care Outlays: BLS CE data show typical annual spending climbs from about $3,500 for ages 25–34 to over $5,000 for ages 65–74, with 75+ households paying even more. These figures reflect Medicare premiums, supplemental policies, prescription drugs, and other out-of-pocket costs.
✅ Insurance & Retirement Contributions: Personal insurance and pensions (life and health premiums plus retirement contributions) peak in mid-career years as households maximize employer-based plans.
✅ Debt Service Patterns: CE data track finance and interest charges, including credit card interest and loan interest (mortgage interest appears under housing). Federal regulators report younger borrowers revolve balances more often and have seen higher delinquency rates since 2021. This can make interest costs a heavier drag on under-35 budgets even when total outlays are smaller.
📝 Note: Managing debt early can reduce long-term interest burdens and free up room for savings and retirement contributions.
2025 Trend Signals Influencing Budgets
Budget pressures in 2025 are shaped by more than just prices. Wage growth, confidence, and shifting consumer habits are all playing roles in how households allocate their money this year.
Inflation vs. Real-Income Adjustments
Headline inflation has cooled but still weighs on household budgets.
✅ Price Growth: As of August 2025, the CPI-U rose 2.9% year over year. Shelter climbed 3.6%, electricity jumped 6.2%, and natural gas rose 13.8%. These categories hit renters and utility payers hardest.
✅ Income Trends: The Employment Cost Index shows wages and salaries up 3.6% over the 12 months ending June 2025 — only modest real gains once adjusted for price growth. This math explains why younger workers, who spend more on rent and energy, still feel a squeeze even with nominal pay increases.
✅ Retiree Adjustments: Many retirees received a 2.5% cost-of-living adjustment (COLA) to Social Security benefits for 2025, partially insulating their purchasing power from inflationary drift.
Confidence & Planned Big-Ticket Purchases
Consumer confidence remains fragile—and it’s directly affecting large-purchase plans.
✅ Weaker Sentiment: University of Michigan surveys show softer “buying conditions” for large household durables and vehicles in late summer 2025, even as month-to-month blips occur.
✅ Mixed Spending Intentions: Deloitte’s August State of the US Consumer report finds financial well-being trending down and price expectations for essentials edging higher. Yet, discretionary spending intentions have rebounded selectively — a “cautious but not frozen” consumer.
✅ Shift in Patterns: McKinsey’s mid-2025 State of the Consumer report notes the traditional link between sentiment and spending has weakened. Households are trading down in some categories while splurging in others, complicating forecasts for big-ticket items like renovations and vehicles that depend on confidence, financing costs, and replacement cycles.
Splurge vs Cut-Back Categories by Generation
According to Qualtrics, consumer behavior in 2025 shows a “barbell” pattern—strategic indulgence in some areas alongside cutbacks elsewhere.
✅ Gen Z: Most likely to increase spending on restaurants and bars (37%) and at-home entertainment (36%). These smaller luxuries deliver immediate enjoyment.
✅ Millennials: Tilt toward dining out and apparel (33% each), with groceries close behind (32%), reflecting convenience and family demands.
✅ Gen X: Split between restaurants (35%) and travel (35%), balancing midlife responsibilities with occasional experiences.
✅ Boomers: Lean most toward travel (41%) and restaurants (36%), using discretionary income to fund experiences.
Qualtrics and McKinsey both highlight this bifurcation: even price-conscious consumers plan select splurges. This coexistence of value-seeking and “treat” purchases signals that categories delivering clear utility or emotional payoff remain resilient.
Looking Ahead: What These Spending Trends Mean for You
The numbers tell a deeper story than simple age brackets. They reveal how life stage, household makeup, and today’s economic climate combine to shape real-world spending choices.
Recent Bureau of Labor Statistics data shows Gen X and mid-career households shoulder the highest costs, while retirees generally spend less but must contend with rising health-care expenses. 2025 surveys also point to shifting habits — young adults allocate more to rent and food away from home, while older cohorts channel spending into travel and wellness.
Looking at these benchmarks alongside your own budget can help you spot where your habits align (or diverge) from national trends. If certain categories like housing or dining out take up more of your paycheck than average, that might be a prompt to revisit your priorities. And if health-care costs are creeping up faster than expected, planning early can soften the impact.
Spending habits will keep evolving with age, but staying aware of where your dollars go makes it easier to adapt to inflation, income changes, and shifting goals.
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