Posted by Brian Berg Google+
The disparity between America's richest and poorest residents has never been more apparent. The affluent live in sprawling multi-million dollar mansions in Beverly Hills; while the hard-up make ends meet in trailer parks. In between are swathes of middle class Americans. But while the income of the country's residents might be at opposite ends of the scale, the way in which they prioritize their spending is strikingly similar, a new study on consumer mailing lists reveals.
The study shows the spending habits of residents, and it reveals citizens are not so different after all; a fact which could bring some consolation to those struggling to get by during a sluggish economic recovery. While the low and middle classes may look enviously on the income of the wealthy, at least this survey suggests their lifestyles are not dramatically different.
The study, carried out by the Consumer Expenditure Survey, looked at the incomes and spending of the country's citizens. It classed the rich as those who earn $150,000 and more per year, the middle classes are those who bring in an annual income of $50,000 and $69,000, while the low income scrape by on between $15,000 to $19,000.
Housing, by far, makes up the largest chunk of American’s expenditure. Regardless of income levels, affluent, middle class and low class residents spend a similar percentage on the home; between 26.7 and 29.2 percent. And the similarities don't end there. Budgets for clothing and eating out are the same across the board; between 3.2 and 3.7 percent and between 4.7 and 5.4 percent respectively.
However, the closeness in the percentage spending figures hides large disparities in the actual amount spent by the different groups. For example, if someone earning $15,000 spends 29.2 percent of their income on housing, the total bill will come to $4,380 for the year. But for a member of the wealthy class earning $150,000, the 27.5 percent share of income spent on housing means an annual bill of $41,250; nearly ten times as much as the low class spend, leading to a significantly higher quality of life.
However, a much large proportion of money is spent on basic living necessities by those on low incomes. Food at home, healthcare and utilities took up more of low class’ budget, while the affluent were able to devote far more to education and retirement.
The middle class spends the biggest proportion on transportation and fuel at 21.3 percent, closely followed by the low income at 20.4 percent and the rich at 15.5 percent.
The affluent spend 15.9 percent of their budget on saving for old age, while middle classes use up 9.9 percent of their income for the same thing. The low income bracket was only able to put away 2.6 percent of their budget on their retirement.
To learn more about income brackets and consumer mailing lists contact the BB Direct Data Team at (866) 501-6273.