Answer: Housing

Here are the top 5 expenses for households (with amounts spent in 2016 ):

1. Housing ($18,886)
2. Transportation ($9,049)
3. Food ($7,203)
4. Personal insurance and pensions ($6,831): largely Social Security payments
5. Healthcare ($4,612)

Questions:

• What are some examples of housing costs? transportation costs? 
• Do you think these costs are about the same across your state? Explain.  
• Average income for American household in 2016 was almost $75,000. One rule of thumb is that you shouldn't spend more than 30% of your income on housing. How did the average American do compared this benchmark? 

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Behind the Numbers (from Bureau of Labor Statistics' (BLS) 2016 Consumer Expenditure Survey): 

The most notable changes in expenditure shares between 2015 and 2016 were in personal insurance and pensions, and the transportation subcategories of vehicle purchases and gasoline and motor oil. Personal insurance and pensions rose from 11.3 percent to 11.9 percent of average annual expenditures. The share for total transportation declined from 17.0 percent to 15.8 percent.

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Here are 200+ more Questions of the Day to pique your students' curiosity. 

About the Authors

Danielle Bautista

Danielle is a native of Southern California and a recent graduate from the University of Maine, where she braved the frigid winters—a feat in and of itself—and earned her Bachelor's degree in International Affairs. She has a passion for working with non-profit organizations and serving populations in underprivileged communities. When Danielle isn't writing NGPF blog posts, spearheading various outreach projects, or managing contests and flash surveys, you can find her doing some sort of outdoor activity, learning a new hobby, or cracking what she thinks are witty puns!

Tim Ranzetta

Tim's saving habits started at seven when a neighbor with a broken hip gave him a dog walking job. Her recovery, which took almost a year, resulted in Tim getting to know the bank tellers quite well (and accumulating a savings account balance of over $300!). His recent entrepreneurial adventures have included driving a shredding truck, analyzing executive compensation packages for Fortune 500 companies and helping families make better college financing decisions. After volunteering in 2010 to create and teach a personal finance program at Eastside College Prep in East Palo Alto, Tim saw firsthand the impact of an engaging and activity-based curriculum, which inspired him to start a new non-profit, Next Gen Personal Finance.