Here’s How Much Retiree Households Spend in a Year

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Retired couple on their porch
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How much does it cost to get by in retirement? Not a whole lot less than it does before retirement.

U.S. households led by someone who is 65 or older spend $52,141 a year, on average. That’s according to the latest federal data on consumer spending, which is for 2021.

By comparison, the average across all households is $66,928.

So, where is all that money going every golden year? The biggest expenses for older households are many of the same as those for younger Americans.

1. Housing

unhappy retiree

More than one-third of older-household spending is related to housing. That translates to an average of $18,872 per year, which compares with $22,624 for the average U.S. household.

That spending includes rent and mortgage costs as well as hidden homeowner costs such as property taxes, insurance, maintenance and repairs. It does not include utilities, which we’ll get to in a minute.

2. Transportation

Highway in Florida Keys
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Commuting expenses might shrink when you retire, but that doesn’t mean all of your transportation costs will.

Older households spent an average of $7,160 on transportation costs such as vehicles, gas and insurance in 2021.

Across all households, the average spending on transportation was $10,961 in 2021.

3. Health care

Worried senior woman in a hospital bed
Monkey Business Images /

Now, here’s an example of an expense that increases in retirement. Older households spend an average of $7,030 on health care annually — compared with an average of $5,452 spent by all households.

The bulk of consumers’ health care spending — for both older households and the average household across all ages — goes for insurance. The rest is on medical services, medical supplies and drugs.

4. Food

woman shopping for bread
Caftor /

Older households spend an average of $6,490 per year on food, including both the food they eat at home ($4,497) and eating out ($1,994).

That’s lower than the average of $8,289 in total food spending by all households overall, which included $5,259 for food at home and $3,030 for food away from home.

5. Utilities and public services

Natural gas
Vova Shevchuk /

Older households spend an average of $3,921 per year on utilities such as natural gas and electricity, and services such as phones and water.

By comparison, the average spent across all households is $4,223.