It turns out that most Americans spend a large chunk of their income on luxury goods. When it comes to cost of living expenses, it turns out we all have expensive tastes.
Per an article in MarketWatch, luxury goods tops the list of what most Americans are spending their money on, regardless of income level.
The highest income bracket spend around 65% of their money on luxury goods and 35% on necessities. Middle income Americans were more even at about 50% for each category. Lower income Americans not surprisingly broke down at about 60% on necessities and 40% on luxury goods.
What Does It Mean?
It should be noted that the wonky science defined certain expenditures such as eating at “McDonald’s” as being “luxury” spending. The idea being that eating out is in itself a luxury. That’s sure to skew the findings.
However, while the percentages may be a little off, the ultimate findings are likely close to reality. It’s no surprise that high-income Americans have more expendable income to put towards luxury items, that lower-income Americans are more practical, and that those in the middle class are closer to half and half.
Of course, luxury spending depends greatly on disposable income. For that, cost of living plays a large role. It’s no secret that the real cost of living varies around the country. State to state and city to city, the real cost of living depends greatly on your location.
City vs City is a powerful cost of living app that examines your true cost of living. We look at your individual zip code and account for your income, savings, expenses, and even major state and local taxes.
Then, we compare your real cost of living to another zip code of your choosing to show you the difference. If you’d like to live in a city where you’ll have a little more money to spend on luxury goods, now you can!
Download the City vs City app and see what a difference a zip code makes.