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Consumer Spending: Where Does Her Money Go?

Consumer Spending: Where Does Her Money Go?

When it comes to how and where consumer dollars are spent, not all income levels are created equal.

According to an analysis of expenditures in three income tiers, the average annual spending on key categories such as food, housing, transportation, cell service, health care and apparel reveals some consumer demographics dole out more money on certain goods and services than others.


As the diagram shows, low-income consumers spend a higher percentage of their income on food, housing and health care than higher-income earners, while middle-income consumers are saddled with higher rates on cell-phone service and transportation.

For consumers earning more than $70,000 a year, more money is spent as a percentage of annual income on apparel and related goods and services as compared to other income tiers.

The spending trends suggest that low- and middle-income consumers have less money to spend on full-price apparel, which may partly explain the strength of the off-price retail sector.


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