Back when humans used to still read physical magazines, I kept a subscription to Sports Illustrated. I’m pretty sure I bought it because a neighbor’s soccer team was running a fundraiser, and I just felt too guilty to say no.
Hey, at least a magazine subscription is healthier for me than the boxes upon boxes of girl scout cookies I inevitably end up buying every year.
I always skimmed through most of the magazine, but the one section I could never get enough of was the weekly “Go Figure” column. The column wasn’t so much an article as it was a short collection of the most interesting, wacky, and head-scratching stats the magazine’s researchers could find.
For your reading enjoyment, I’ve shamelessly stolen the idea. Since My Money Wizard isn’t exactly a sporting website, our focus will be a little more personal finance oriented.
Here’s to a new tradition!
Go Figure: American Spending
$69,629 Average pre-tax household income in America last year.
4.7 Percent of income the average American saves per year.
21.3 Years it takes to save just one year’s worth of living expenses, given the above savings rate.
$2,000 Amount of money which only 1/3 of Americans felt certain they could come up with for an unexpected need.
76 Percent of Americans who admit to living paycheck to paycheck.
40 Percent of households who feel they “have too much debt right now,” according to a 2012 survey of over 25,000 households.
$279,002 Dollars of interest the average consumer will spend over their lifetime.
$70.2 billion Amount Americans spent buying lottery tickets last year.
$63 billion Total amount Americans spent last year on Sports Tickets, Books, Video Games, Movie Tickets, and Music… combined.
This obviously paints a pretty grim picture of the finances in this country. And frankly, the first stat makes the rest even worse. You’d hope to see people take responsibility for this disaster, but apparently most are looking to the lottery to save themselves from their woes.
Thankfully, if you’re reading this your situation probably looks pretty different from the above picture, or you’re quickly learning how to turn things around.
We don’t need to look to the lottery, because we’re in it for the long game. The great irony of it all, of course, is that the long game will make you richer far quicker than the short one.
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That average household income is surprising to me. I thought it would have been lower for some reason. And that savings rate is just so low. I know most of us in the PF community are pretty abnormal when it comes to our savings rates, but I think even 4 or 5% would be considered low to the regular person as well.
Not really sure how you can make it to the end when only that little of your income gets put away. It’s likely either a spending problem or if its because things are just getting more expensive (housing costs going up, healthcare costs going up, education costs going up, etc – while wages stay stagnant).
Household income was surprisingly high to me for some reason too. I’ve heard a lower number quoted before, but this one was directly from the department of labor’s annual study. I’m still looking for a full breakdown on how they calculate the number.
IMO the increased cost of housing is a spending problem. From the numbers I’ve seen, houses are getting more expensive because consumer preference is getting more expensive. The rest may be legitimate concerns, but there’s still no excuse for a 4-5% savings rate when there’s so much fat to be trimmed in the average household budget. Let’s start with $70 billion spent on lottery tickets.
Homeowners with fixed-rate mortgages (or no mortgages) are largely insulated from increases in housing costs; it’s renters who are getting clobbered because they always must pay current rents and because rent – unlike a mortgage – never goes away.
Median homeowner income is just about 2x median renter income, and the proportion of income consumed by housing for renters is just about 2x the proportion of income consumed by housing for homeowners. So I don’t expect renters generally to be big savers, and I have to wonder why homeowners aren’t saving a lot more than they are.
Wow. Grim indeed. Although I wonder – might the “have too much debt right now” statistic be even higher in the FI community, where a $20,000 student loan balance might be considered “too much debt” for a six-figure salary earner? Food for thought 🙂
I’m certainly going to enjoy this “Go Figure” thing. Please make it a regular post!
Interesting point! The FI community definitely has different definitions for “too much debt,” “too much spending,” etc. than the rest of the world.
Glad you enjoyed this Go Figure style. I’ve got plenty more lined up, so keep checking back!
Love this! The “Go Figure” column definitely takes me back to my childhood days of reading Sports Illustrated. Go Figure and Rick Reilly’s column were my two favorites. Excited to see you run with this concept.
Same here! I read every word of Go Figure at the beginning, skimmed the rest of the magazine, and then every word of Rick Reilly’s column at the end.
Glad to hear there’s some interest. I’ve got lots of exciting future Go Figures lined up.