$78,535Average household spending, 2024 (BLS)
$12,863Yearly cost to own a new car (AAA, 2026)
$26.77Average overdraft fee (Bankrate, 2025)
10%Possible heating and cooling savings from thermostat setbacks (DOE)
Key takeaway: Most of a household's money goes to housing, transportation and food. Those three took about 63% of average spending in 2024. One decision in one of them, like a roommate, keeping a paid-off car or cooking more often, usually saves more than dozens of small cuts. Fix the big three first, clear out fees and unused subscriptions, then automate what you save so it doesn't drift back into spending.
How we put this guide together: We started from what Americans actually spend, using the Bureau of Labor Statistics Consumer Expenditure Survey, and added the latest CPI release, AAA's 2026 driving-cost study, USDA food-plan costs, Bankrate's checking fee survey, Department of Energy guidance and a CNET subscription survey. Savings estimates are our calculations from those figures, with the assumptions shown. All figures were checked in October 2026. Prices and rates change. See our advertiser disclosure.

Where the money actually goes

The average U.S. household spent $78,535 in 2024. Here are the categories where cuts can make a real difference:

Category (2024 average)Per yearPer monthBiggest leverExample annual savings*
Shelter$16,317$1,360Roommate, cheaper unit at renewal, refinance$3,000–$8,600
Transportation$13,318$1,110Keep or buy a used car; drop a car if transit works$1,100–$5,000+
Food at home$6,224$519Meal planning, store brands, fewer trips$600–$4,400
Food away from home$3,945$329Halve restaurant and delivery spendingAbout $1,970
Utilities, fuels and public services$4,736$395Thermostat setbacks, comparing phone and internet plansUp to 10% of heating and cooling costs
Vehicle insurance$1,993$166Compare quotes at every renewalVaries by driver and state
Subscriptions (CNET survey)About $1,080About $90Cancel unused servicesAbout $205
Bank fees (Bankrate survey)––Switch to free checking, use in-network ATMs$65–$236

Source: BLS Consumer Expenditures 2024 (released Dec. 2025); CNET/YouGov subscription survey (May 2025); Bankrate 2025 checking survey. *Savings ranges are MoneyVerge calculations explained in each section below.

1. Housing: the biggest lever, but the hardest to change

Housing took 33.4% of the average household's spending in 2024, and shelter alone averaged about $1,360 a month. Harvard's Joint Center for Housing Studies found that nearly half of renter households were cost-burdened in 2024, meaning they spent more than 30% of income on housing. Shelter prices were still rising 3.0% a year as of August 2026.

  • Add a roommate or rent out a room. If a roommate pays 40% of an $1,800 rent, you save $720 a month, or $8,640 a year. Nothing else on this list comes close.
  • Negotiate or move at renewal. Ask before you sign, and bring listings for comparable units. Getting $250 a month off at renewal, or moving to a unit that costs $250 less, saves $3,000 a year. Moving costs eat into the first year's savings, so do the math.
  • Homeowners: check your escrow costs. Shop homeowners insurance at renewal and appeal your property tax assessment if similar homes are assessed lower.

2. Transportation: a car costs much more than its payment

AAA's 2026 study estimates that owning and operating a new vehicle costs $12,863 a year, or about $1,072 a month, based on 75,000 miles over five years. That is up from $11,577 in 2025. The largest piece is depreciation, at $4,422 a year; finance charges add more if you borrow. BLS puts average household gasoline spending at $2,411 a year.

  • Keep a paid-off car longer. You stop paying finance charges and skip a new car's steepest depreciation, which AAA puts at $4,422 a year on average for a new vehicle. Your older car still loses some value and may need more repairs, so the real savings will be less, but often by thousands.
  • Buy used rather than new when you do replace a car, and get a loan quote from a credit union or bank before you visit the dealer.
  • Two cars down to one, if transit, biking or remote work makes it possible, removes an entire set of insurance, maintenance, registration and depreciation costs.

Costs also vary a lot by state. See our report on why car ownership costs more in some states.

3. Insurance: compare quotes at every renewal

Households spent an average of $1,993 on vehicle insurance and $4,055 on health insurance in 2024. Auto insurance prices have started to ease: the CPI for motor vehicle insurance was down 5.1% over the 12 months to August 2026. That doesn't mean your insurer has cut your premium. When prices across the market fall, comparing quotes is how you get the lower price.

  • Get at least three auto quotes before each renewal, using identical coverage limits so the comparison is fair. Start with our guide to the cheapest auto insurance.
  • Raise your deductible only if your emergency fund could cover it.
  • Bundling home or renters insurance with auto can help, but compare the bundle against separate policies.
  • During open enrollment, compare health plans on total expected cost (premiums plus likely out-of-pocket spending), not premium alone.

4. Food: groceries and dining out

The average household spent $6,224 on groceries and $3,945 on food away from home in 2024. Over the 12 months to August 2026, grocery prices rose 2.2% while restaurant prices rose 3.4%, so the gap between cooking and eating out keeps widening.

USDA's food plans show how wide the range of grocery budgets is. For a family of four with school-age children, the plans recently ranged from about $1,018 a month (Thrifty) to $1,387 (Moderate-Cost) and $1,675 (Liberal). Moving from Moderate to Thrifty spending is about $370 a month, or roughly $4,400 a year. A smaller change, such as one fewer shopping trip and store brands for staples, might save $50 a month, or $600 a year.

  • Plan meals around what's on sale and what you already have, and shop with a list.
  • Cut delivery first. Check your receipts: service fees, delivery fees and tips on top of menu prices add up quickly.
  • Halve restaurant spending. At the $329-a-month average, that saves about $165 a month, or roughly $1,970 a year.

5. Subscriptions and recurring charges

In a May 2025 CNET/YouGov survey, Americans reported spending about $90 a month on subscriptions, including about $17 a month (roughly $205 a year) on services they rarely or never use.

  • Search 90 days of card and bank statements for every recurring charge, including annual renewals.
  • Cancel anything you haven't used in the past month. Rotate streaming services instead of paying for all of them at once.
  • Put a reminder in your calendar the day before each free trial ends.

6. Utilities, phone and internet

Average spending on utilities, fuels and public services was $4,736 in 2024, about $395 a month, and electricity prices were up 3.8% over the year to August 2026. The Department of Energy says you can save as much as 10% a year on heating and cooling by setting your thermostat back 7–10°F for eight hours a day. It suggests 68–70°F while you're awake in winter, and lower while you're asleep or away.

  • A programmable or smart thermostat makes setbacks automatic.
  • Call your internet provider when a promotional rate ends, and compare lower-cost phone plans before renewing.
  • Ask your utility what efficiency programs or billing options it offers.

7. Bank fees and interest

Bankrate's 2025 survey found an average overdraft fee of $26.77, an average monthly maintenance fee of $5.47 on non-interest checking accounts, and an average total out-of-network ATM charge of $4.86. Yet 47% of non-interest checking accounts had no monthly fee, and another 48% waived it with direct deposit.

A household paying a $5.47 monthly fee, two overdrafts a year and two out-of-network ATM withdrawals a month loses about $236 a year ($65.64 + $53.54 + $116.64). Switching to one of the best free checking accounts, turning off overdraft coverage or linking a savings account, and using in-network ATMs eliminates nearly all of it.

Interest is the more expensive leak. Banks charged an average of 22.15% on card accounts that paid interest in the second quarter of 2026, so a $5,000 balance costs about $1,100 a year. Paying it off is a guaranteed 22% return.

Automate the savings, or they disappear

Money you save by cutting a bill tends to get spent somewhere else unless you move it. The Consumer Financial Protection Bureau calls recurring transfers from checking to savings one of the easiest ways to save consistently. Each time you cut a cost, raise your automatic transfer by the same amount the same day.

Where you keep it matters too. The FDIC national average savings rate was 0.37% in September 2026. In late September, several online banks advertised 4.01%–4.25% APY, according to a September 28 rate roundup. On $10,000, that's roughly $400 a year versus $37. Keep savings in an FDIC-insured account, covered up to $250,000 per depositor, per bank, per ownership category, and compare current options in our high-yield savings account guide. Build an emergency fund first, then save for other goals.

Watch for lifestyle creep

Lifestyle creep is when spending rises to match each raise, so you earn more but save no more. It rarely feels like a decision: a nicer apartment, a newer car, more takeout. Three rules prevent it:

  1. Split every raise. Send at least half of the after-tax increase to savings before your first bigger paycheck arrives. On a $4,000 raise, that's at least $2,000 a year saved without cutting anything.
  2. Keep paid-off payments going. When a car loan or student loan ends, keep "paying" the same amount into savings.
  3. Revisit your spending split once a year. The 50/30/20 rule is a quick check that wants haven't quietly crowded out savings.

Frequently asked questions

What is the fastest way to save money?

Cut recurring costs you no longer use, such as unused subscriptions and bank fees, and stop paying credit card interest where you can. These take an afternoon. Housing and car decisions save more but take longer to act on.

How much money can I save by cooking at home?

It depends on your current spending. The average household spent about $329 a month on food away from home in 2024, so cutting that in half saves roughly $1,970 a year, minus some extra grocery costs.

Is it worth switching banks to avoid fees?

Often, yes. Bankrate's 2025 survey found an average $5.47 monthly maintenance fee and a $26.77 overdraft fee, while 47% of non-interest checking accounts had no monthly fee.

Where should I keep the money I save?

Keep it in an FDIC-insured high-yield savings or money market deposit account. The national average savings rate was 0.37% in September 2026, while many online banks paid more than 4% APY.

What is lifestyle creep?

It's when spending rises with each raise, so your savings rate stays flat. Sending part of every raise to savings automatically is the simplest fix.

Does turning down the thermostat really save money?

The Department of Energy says setting it back 7 to 10 degrees Fahrenheit for 8 hours a day can save as much as 10% a year on heating and cooling.

Sources

Rates, fees and terms change often. Figures were checked in October 2026; confirm current details with the provider before you apply.