This visualization is one of a series of visualizations that present US household spending data from the US Bureau of Labor Statistics. This one looks at the education level of the primary resident.
This visualization focuses on the education level of the primary resident. This is defined in the BLS documentation as the person who is first mentioned when the survey respondent is asked who in the household rents or owns the home.
I obtained data from the US Bureau of Labor Statistics (BLS), based upon a survey of consumer households and their spending habits. This data breaks down spending and income into many categories that are aggregated and plotted in a Sankey graph.
One of the key factors in financial health of an individual or household is making sure that household spending is equal to or below household income. If your spending is higher than income, you will be drawing down your savings (if you have any) or borrowing money. If your spending is lower than your income, you will presumably be saving money which can provide flexibility in the future, fund your retirement (maybe even early) and generally give you peace of mind.
The composition of households and income change as the education level of the primary resident changes, which in turn affects spending totals and individual categories.
As stated before, one of the keys to financial security is spending less than your income. We can see that on average, income tends to increase with education level. Those with the highest incomes and greatest spending have advanced degrees, but they also save the most money.
The group with the lowest education level (not finishing high school) have the lowest income and on average needs to borrow or draw down on savings to live their lifestyle.
How does your overall spending compare with those that have the same education level as you? How about spending in individual categories like housing, vehicles, food, clothing, etc…?
Probably one of the best things you can do from a financial perspective is to go through your spending and understand where your money is going. These sankey diagrams are one way to do it and see it visually, but of course, you can also make a table or pie chart (Honestly, whatever gets you to look at your income and expenses is a good thing).
The main thing is to understand where your money is going. Once you’ve done this you can be more conscious of what you are spending your money on, and then decide if you are spending too much (or too little) in certain categories. Having context of what other people spend money on is helpful as well, and why it is useful to compare to these averages, even though the income level, regional cost of living, and household composition won’t look exactly the same as your household.
Here is more information about the Consumer Expenditure Surveys from the BLS website:
The Consumer Expenditure Surveys (CE) collect information from the US households and families on their spending habits (expenditures), income, and household characteristics. The strength of the surveys is that it allows data users to relate the expenditures and income of consumers to the characteristics of those consumers. The surveys consist of two components, a quarterly Interview Survey and a weekly Diary Survey, each with its own questionnaire and sample.
Data and Tools: