Average Monthly Expenses by Age: Which Group Is Spending the Most?

Different stages of life come with different opportunities and challenges. How much you make and how much you spend has a lot to do with how old you are.

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Here is a breakdown of how much each age group spends on average and some reasons for it , with information sourced from Bureau of Labor Statistics, and reported from InCharge Debt Solutions .

Also here is how to save money on your monthly expenses.

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Under 25

Americans under the age of 25 have the lowest spending of any age group. On average, they spend $3,863 per month and $46,359 per year. Individuals at this age have fewer financial responsibilities and lower incomes than those at later stages in life. They may have schooling or job training expenses, but many don’t have mortgages or dependents to worry about. At this age, many still live with their parents or share housing expenses with roommates, reducing their spending.

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Age 25 to 35

The age group of 25- to 35-year-olds spends $5,657 monthly and $67,833 annually on average. The uptick in spending may be due to settling down and starting families. At this age, individuals are beginning to gain experience and some seniority in their careers, which increases their income and the amount of money available to spend.

Age 35 to 45

Spending jumps again between the ages of 35 and 45, averaging $7,171 per month and $86,049 per year. Many adults in this age range will raise families and must deal with the associated expenses, such as schooling costs, clothing, food and recreational activities. Individuals at this age may also spend a lot of money on debts, such as student loans and mortgages.

Age 45 to 54

American adults between the ages of 45 and 54 spend the most, averaging $7,590 monthly and $91,074 yearly. These individuals will often continue to have increasingly expensive parenting expenses, as for many of them, their children have become teenagers. Additionally, they may need to cover other costs due to aging parents and more expensive housing and transportation costs.

Age 55 to 64

Between the ages of 55 and 64, expenses begin to dip. These adults spend an average of $6,507 per month and $78,079 per year. At this point, children begin to move out and start covering their own expenses, freeing up a significant amount of money. These individuals also begin to resolve their mortgages. While this period may be when they earn the most in their careers, these individuals may opt to save more for retirement than spend the excess money.

Age 65 and Older

When Americans reach this age, they are often in retirement. Because they’re not actively earning a salary anymore and must rely on their retirement savings, their spending habits become more conservative. While these individuals often don’t need to worry about expenses relating to children and housing as much, their healthcare expenses begin to rise as time goes on. On average, adults aged 65 or older spend $4,818 per month and $57,818 per year.

How To Cut Your Spending

Regardless of your age, there are effective practices that you can adopt to improve your financial situation. Increasing your income by asking for a raise, getting additional work or monetizing a hobby helps, but it isn’t realistic for everyone. On the other hand, cutting your spending is a way to maximize the money you have coming in. Here are some ways to do that.

Keep a Budget

Creating and sticking to a budget is the most efficient way to determine the areas where you can reduce spending. Without a budget, you might be unaware of how much you spend on certain expenses in the short or long term. By tracking your progress over time, you can continue to cut your spending and funnel that money toward more productive areas like paying down debt, investments or savings.

Review Your Subscriptions

Signing up for a subscription service is easy, and forgetting about it is even easier. One of the best ways to cut your spending is to cancel subscriptions you don’t use. Look through emails, bank statements and credit card bills and list your subscriptions and recurring payments. Terminate any subscriptions that you don’t use at all. Prioritize your remaining subscriptions to find any others that you can drop to further cut costs. Remember to look for recurring annual subscriptions, too.

Get Into Cooking

Eating out and ordering food are expensive habits that can increase your monthly expenses. Rather than paying extra for the convenience of someone else making your food, do it yourself and save. There are many easy-to-follow recipes online that can help you make delicious food and reduce your spending at the same time.

Use Cash

When you make purchases online or in stores using your credit or debit cards, you often don’t fully grasp how much you’re spending.  Swiping a card to buy something doesn’t feel as real and can easily lead to overspending. When you use cash, you’re physically handing over money. This action can reinforce the cost of your purchase so you’re aware of what you’re actually spending. Using cash is also an excellent way to make sure you don’t spend more than you’ve budgeted. Save your card purchases for planned spending that you’ve already budgeted for instead of impulse buys.

This article originally appeared on GOBankingRates.com : Average Monthly Expenses by Age: Which Group Is Spending the Most?