Even if you're not living extravagantly, life gets expensive. As a result, building a sustainable savings account is a big challenge for many families. Yet, by breaking down your own spending, you can start to look for ways to save. The guide below explores how most Americans spend their money as well as what you can do to start accumulating wealth. 

What Are the Average Person's Spending Habits?

The three biggest expenses for most Americans are housing, transportation, and food. According to the Bureau of Labor Statistics’s annual Consumer Expenditure Survey (CE), the average person spends around $20,091 per year on housing, $9,761 on transportation, and over $7,923 on food. Some of the other most common expenditures include:

• Apparel and services—$1,866

• Entertainment—$3,226

• Health Care—$4,968

• Personal care products and services — $768

To identify room for improvement in your financial life, review your checking account statements and calculate your total expenditures for each category.

How to Reduce Costs & Save Money

While not all expenses are avoidable, there are a variety of ways to cut down on your spending. For example, nearly half of the food costs in the CE report—$3,459 to be exact—are spent on eating away from home. To boost your savings by eating out less, thoroughly plan your meals ahead of time before you grocery shop and spend a few hours on the weekend prepping the ingredients.

Reducing transportation and housing expenses is more challenging. Selling your vehicle or home for a less-expensive one isn't always an option. However, you can cut costs by refinancing your current mortgage or auto loan to obtain lower interest rates. By paying less interest, you can expect lower monthly premiums. Those funds can, then, be redirected into a savings account. 

Looking to grow your savings? Spirit of America Federal Credit Union in Lincoln, NE, offers a variety of financial solutions to help clients save money. They're also insured by NCUA. From savings accounts to mortgages, the member-owned credit union is committed to putting customers across Lancaster County first with competitive interest rates and low-cost services. Learn more about their product offerings online. Request personalized assistance today at (402) 467-1102.