According to the most recent data, U.S. households that consist of four people spent an average of $8,640 per month in 2022. In 2021, the average four-person household spent $7749 per month. This works out to average annual expenditures of $101,514 in 2022, up from $92,989 in 2021.
If you're raising a family of four in 2024, you'll need a six-figure income in 26 U.S. states. That's more than half of America where you'll need to earn $100,000 or more annually to budget for and comfortably raise a family. Check Out: What Is the Median Income for the Upper Middle Class in 2024?
Setting budget percentages
That rule suggests you should spend 50% of your after-tax pay on needs, 30% on wants, and 20% on savings and paying off debt.
Dave Ramsey, finance author and speaker, recommends allotting 2-7% of your income to clothing for the whole family. He also includes laundering cost in this allotment. To figure out what this is for your family, multiply your income by a percentage in that range. Divide by 12 to determine the monthly budget.
Those will become part of your budget. The 50-30-20 rule recommends putting 50% of your money toward needs, 30% toward wants, and 20% toward savings. The savings category also includes money you will need to realize your future goals.
Follow USDA food plans
The October 2024 estimate for a family of four on a thrifty plan is about $987 per month. (The USDA defines this family as a male and female between ages 20 and 50, and two children, ages 6 to 8 and 9 to 11.) Food and Nutrition Service U.S. Department of Agriculture.
We like the 50/30/20 budget as a place to start. It splits your income three ways: 50% toward needs, such as groceries, housing, basic utilities, transportation, insurance, child care and minimum loan payments. 30% toward wants, such as travel, gifts and meals out.
A $100,000 salary is considered good in most parts of the country, and can cover typical expenses, pay down debt, build savings, and allow for entertainment and hobbies. According to the U.S. Census, only 15.3% of American households make more than $100,000 annually.
Housing is by far the largest expense for Americans. Monthly housing expenses in 2023 averaged $2,120, a 5% increase from 2022. Over the course of 2023, Americans spent $25,436 on housing on average.
How much does raising a child cost yearly? The $288,094 figure can seem incredibly intimidating — but remember, that cost is spread out over 18 years. Taking a rough average, that's around $16,005 per year — or approximately $1,334 per month.
When you manage your budget well, you can easily navigate your finances in retirement on $8,000 per month, even in cities with above-average costs. As long as you maintain a healthy emergency fund, you should be able to manage the ebbs and flows of your personal finances with ease.
A single person household spends an average of $4,641 on monthly expenses. Married couples without kids spend an average of $7,390 on monthly expenses. A family of four spends an average of $8,450–9,817 on monthly expenses (depending on kids' ages).
Middle-income households – those with an income that is two-thirds to double the U.S. median household income – had incomes ranging from about $56,600 to $169,800 in 2022. Lower-income households had incomes less than $56,600, and upper-income households had incomes greater than $169,800.
SmartAsset extrapolated the income needed for a 50/30/20 budget based on the cost of necessities, using data from the MIT Living Wage Calculator. Here's a look how much income a family of four needs to live comfortably in the 20 most expensive U.S. cities: San Francisco: $339,123. San Jose, California: $334,547.
The 50-30-20 budget rule states that you should spend up to 50% of your after-tax income on needs and obligations that you must have or must do. The remaining half should dedicate 20% to savings, leaving 30% to be spent on things you want but don't necessarily need.
We recommend the 50/30/20 system, which splits your income across three major categories: 50% goes to necessities, 30% to wants and 20% to savings and debt repayment.
On average, American households are paying about $270 per week ($1,080 a month) for groceries, according to Delish, which sourced their findings from the latest Census Bureau estimates.
A rough rule of thumb is to allow about $100 a week per person in your household, but the overall amount shouldn't be more than one-third of your household's after-tax income. Plan meals. Save money and time by planning meals for a few days or a week. This will also help reduce food waste.