News & Special Offers
Home > Money > Overspending in America – The Sad Truth
Get $50 when you open a CapitalOne 360 account

Overspending in America – The Sad Truth

If you are a first time reader here, then I will let you know that I LOVE infographics.  I am a very visual leaner, so if I can gain some knowledge through a picture, then I am going to do it.

I found this awesome, yet sad, infographic the other day and it really disturbed me.  Not only do American’s have an overeating problem, but we also overspend (much like our government).  According to the graphic below, the average American is spending $1.33 for every $1 earned.  Are you kidding me?  No wonder we have such a problem with debt, whether it be student loans, auto loans, home loans, or credit cards.

Take some time to soak in the data from the infographic.  The numbers might scare you, but also may not surprise you.  We need a change in our culture and we need it quickly.  If you are in debt and don’t want to be a statistic any longer, then think about joining the Debt Movement!

Overspending in America   The Sad Truth money

Browse more data visualization.

Save Money On Your Cell Phone Bill With Straight Talk

Pay just $45 a month for unlimited talk, text, and data. You get access to either the AT&T network or T-Mobile. You can bring your own phone or buy one of theirs. It is a great service and one that I wrote a detailed review about. Check out my Straight Talk Review!
Subscribe to Debt Roundup
You will receive an email when a new post goes up on DR. Your email address is NEVER shared!
Overspending in America   The Sad Truth money

About Grayson Bell

I am an average Joe, who built up over $50,000 worth of credit card debt and had to learn how to break it back down. It took 4 years of learning budgets, secrets, and many other personal finance tricks in order to cut the debt to $0. Now, I push to teach others not only how to get out of debt, but how to use credit wisely and how to start growing their wealth. You can view my other site, Sprout Wealth for ways to grow your money. I am also a freelance personal finance writer who provides staff writing and ghost writing services.

88 comments

  1. This really shows the extent of the problem and the reasons behind it. I don’t know if it’s the same in the US but over here credit providers have been slashing credit limits & increasing interest rates across the board. It’s making it more difficult for borrowers to get further into debt but it’s also hurting those who have built up way too much debt over the years, some of them are still overspending but at massively inflated rates.
    Money Bulldog recently posted..Spread Betting on CottonMy Profile

  2. That is a crazy infographic!!!! Sad but true!
    Holly@ClubThrifty recently posted..6 Tips for Making Home Ownership AttainableMy Profile

  3. Great infographic! I think 1 in 4 having more debt than savings actually isn’t that bad, assuming they are including students and recent graduates into that figure. I don’t know many recent graduates who have more savings than student loans.
    DC @ Young Adult Money recently posted..5 Ways to Invest in YourselfMy Profile

  4. EWWWWWW! Now, I don’t overspend, but I technically fall into some of those categories, sadly. I spend most all of my monthly money on the necessities. But the difference is, I have a plan. :)
    Jacob @ iHeartBudgets recently posted..Budget Friday: Submission 7My Profile

  5. I had a client from Ethiopia who told me that when he lived there, he couldn’t figure out how to spend $100 if he wanted to…there was everything he wanted and more on less money. In America, we’ve created this “need” to have more and more and more.
    AverageJoe recently posted..How Successful People Accomplish More – Two Guys and Your Money 025My Profile

    • I completely agree Joe. We have also created a society of wants and the need to have things now. This is why we overspend, we feel that we actually “need” these products.

  6. Unfortunately I’m not really surprised by this data. It’s certainly sad but overspending is a major issue and I can’t see a time where it ever gets corrected. We’re going to need a MAJOR recession/depression in order to creating lasting change that will impact generations to come. However, I hope it doesn’t come to that…
    Andy @ WSL recently posted..FreeTaxUSA – Review and Analysis by a Tax AccountantMy Profile

    • It will take something drastic. Even when we had the recession in 2008, people started saving and paying off debt, but now 4 years later, people are spending more and saving less.

  7. Wow, I fell into some of these catagories. This infographic is so interesting!
    Mackenzie recently posted..Would You Spend Money On It?My Profile

  8. Tackling Our Debt

    I love infographics too and this one says it all. Unfortunately many people do not consider budgeting or watching their spending until it is too late.
    Tackling Our Debt recently posted..How Do You Define Success?My Profile

  9. I’m not really surprised. No plan+ ease of credit= rough landing at some point.
    Kim@Eyesonthedollar recently posted..How to Retire in Ten Years, Regardless of Your AgeMy Profile

    • Yep. It is getting harder to get credit, than it used to be, but you can still get it. Lenders make their money from people that don’t pay on time. If they lend to people like me (credit cards), then they would just pay me rewards to use their product.

  10. Wow those are some troubling figures! That means on average, people need to cut down their spending by a quarter, just to stop overspending!

  11. I want to say “unbelievable” but it’s not. I like the icons for each of the money-saving tips.
    Joe recently posted..My Price Protection FailMy Profile

  12. Ugh…so sad, yet so true.

    Great infographic though; thanks for sharing!
    The Happy Homeowner recently posted..Kick Your Debt to the Curb in Four Easy StepsMy Profile

  13. Very cool infographic! Sadly, it shows the true state of many American’s trouble with money – spending more than they have and that spending rate increasing over the years. Hopefully more more will become educated on handling their finances better so that the next time this infographic is compiled, it will show better news.
    Jon @ MoneySmartGuides recently posted..The More You Trade, The Less You EarnMy Profile

  14. Brett @ wstreetstocks

    Your right, these statistics are very troubling. I am shocked to see that Americans spend 1.33 for every 1 dollar they earn.
    Brett @ wstreetstocks recently posted..Will the FB rally continue?My Profile

  15. You should have to pass a test before you can get a credit card, seriously. People do NOT understand the implications of having one.
    Catherine recently posted..The Sexiest Thing My Money Has BoughtMy Profile

  16. Awesome infographic Grayson, I even added it to my Pintrest page. What’s even worse is the savings rate is at a negative for most people as well. What happen to the days when people saved their money and didn’t spend it? Maybe that just me though.
    Chris @ Stumble Forward recently posted..How to Control Your Debt to Income Ratio – A Guide For BeginnersMy Profile

  17. What an easy to read infographic with lots of information that really puts the problem into perspective for anyone who reads this. Thanks for sharing.
    Canadian Budget Binder recently posted..The Pros and Cons of Homeschooling In Canada Part 2 of 2My Profile

  18. Great infographic. Having more debt than savings brrrrr…Although I would have expected that people spend way more than before, not just 30%
    Pauline recently posted..13 money resolutions for 2013: #11 give back!My Profile

  19. Every time I see one of these infographics, I just get a sick feeling in the pit of my stomach. What does the future of America hold if we continue down this “live for today” path? I’m not sure I want to know.

    Thanks, Grayson, for another educational post!
    Laurie recently posted..Motivation: Learning From OthersMy Profile

  20. The average person’s spending has increased 30% in the past 25 years? That’s CRAZY! Why has that happened? Are people more concenred with image than before? Are we dumber than before? Are advertisers doing better than before?
    Tb at BluecollarWorkman recently posted..Snowplow Proofing Your MailboxMy Profile

    • I think you hit most of them right on Tb. More people are concerned with their image and still keeping up with the Joneses. Advertisers are making it look like we “need” products. I do think we are slowly losing our common sense as people lean toward technology use. It is bad.

  21. I’m actually really surprised that 50% of Americans set up a budget (even if they don’t stick to it.) Usually when I talk about my budget, people look at me like I have horns sticking out of my head. Still, the only real way I’ve learned to try to beat this sad trend is to regularly tell myself “no” when I want something. Great post, Grayson!

    • I was surprised that that too. I don’t know if most of them actually use their budget, but oh well. The big issue here is about wants and needs. Many people cannot differentiate between them. Thanks for stopping by Cat!

  22. What makes me sad that at some point, I’ve been guilty of some/most of these things. Really cool graphic.
    Marissa @ Thirtysixmonths recently posted..How to Ask for a DiscountMy Profile

  23. This is a great infographic and I also like a lot of comments here used to fall into the category of biting more than I can chew. I learned my lessons now and I am slowly biting more and leaving some leftovers.
    Brian @frugallyminded recently posted..The Frugal Food ForagerMy Profile

  24. If the feds can’t balance the budget why should I balance my checkbook? Such good role models we have as Americans.
    KK @ Student Debt Survivor recently posted..Honoring Dr. King’s Birthday With a Day Off?My Profile

    • I agree with you KK, unfortunately, the government and companies will just come after you if you don’t pay your debts, but who will go after the government of a super power?

  25. Awesome graphic!!!
    Like the graphic indicates, less than 50% Americans are budgeting. And I think without a budget, you’re nothing.

  26. Mike @Personal Finance Beat

    Crazy and depressing post. Individuals are spending more than they earn, and so is our government! When will it stop?

    This just serves as a reminder to me that no matter what everyone else is doing, and what’s outside our control, you can still be responsible for your OWN finances and make sure YOU are doing well.
    Mike @Personal Finance Beat recently posted..What Is Driving Growth In Government Spending?My Profile

  27. Great post. Love the visuals! It is frightening when you think how many people are living beyond their means – and so many are unaware of their spending habits. I wholeheartedly agree with every one of your reasons why people overspend. My father taught me at young age that money was emotional and when our emotions drive our money decisions, our tendency to make poor decisions is higher. He taught me to instead align my money decisions with my values and goals, which I am teaching my girls to do as well.
    Shannon @ The Heavy Purse recently posted..The Myth of NoMy Profile

  28. Wow cool infographic! It is sad to see this country’s people going into debt over silly reasons like these. We need to stand up and think about our spendings. If everybody cut down on meaningless purchases I think that we would see a turn around.
    Jon A recently posted..Reasons To Attend Your Own Home InspectionMy Profile

  29. This is a great graphic. I’m personally very responsible with my finances. And yet I have acquaintances who really are racking up a huge amount of debt, living beyond their means and then planning to go into bankruptcy. I think we need to have major financial education starting in elementary and middle school to really turn this around. There’s nothing for this but education.

  30. It seems super scary to me to consider half the population spending more than they earn. Do the debt statistics include mortgage debt?
    CF recently posted..Updates: January 20 – 26My Profile

  31. Wow, awesome infographic Grayson! It’s pretty crazy that most people think taking on debt is not a terrible decision. Everything is “easy payments of $X a month” and people are like wow, I can afford that. The irony is, unless you can pay for it all in cash you can’t afford it and even though you’re too cash strapped to buy it now, you will wind up paying a hell of a lot more over time if you take the payment option!
    Andrew @ Listen Money Matters recently posted..How I Save a Ton on Travel ExpensesMy Profile

    • Right on point Andrew. The advertising in this country makes it so simple to think you can “afford” something, but most people that fall for those advertising tricks are the ones that cannot afford it.

  32. sweet infographic, Grayson..

    i think that accepting what you have and learning to be happy with it is the most important way to escape the cycle.. if you are insisting on living a life of constant upgrades, you will be stuck in a rat race that you cannot win.
    jefferson @SeeDebtRun recently posted..What if You Fell Off the Roof?My Profile

  33. I think the problem of most Americans is spending more than they earn. People should stop relying on credit cards that much and start spending only what they have if they want to regain control. Did you know that in countries like Bulgaria for example, most of the people own their own houses as opposed to getting loans or renting a place? Maybe America should take example from one of those smaller countries. Debt is not a good thing especially if no one bother paying it back.

  34. Grayson, great eye-opening post, so sad to see we are the Nation of Deadbeats! Our government and the media promote this. Even the poor in this country are consumers, why? cause they are afforded it by the folks in Washington giving it all away for free!
    Jim recently posted..Ammunition: The New American CurrencyMy Profile

  35. I like the tip about carrying enough cash. When you watch the bills slip right out of your wallet it’s harder to spend. It’s just too easy to swipe plastic.

  36. I wish I would have had that stat for the post I just wrote on the habits of broke people. That is crazy that people spend $1.33 for every $1. If it doesn’t change soon, we may see another 2008-2009 re-run.
    Deacon @ Well Kept Wallet recently posted..5 Habits of Broke PeopleMy Profile

  37. I hate debt with a passion! The problem is that I learned all of these tricks after being a super spendaholic for the first 25 years of my life. It wasn’t until I met my wife where we started eliminating the pile of debt we had both collected. Feels good though to be free, I’ll tell you that much!
    Johnny Moneyseed recently posted..Living on less: Cutting the cordMy Profile

  38. This is such a first world problem. We have traveled a lot and in many other areas of the world, spending too much is not an issue. People are content with what they have and they focus on other things. We really could learn a thing or two from them.
    Miss T @ Prairie Eco-Thrifter recently posted..Guerrilla Gardening And Seed BombingMy Profile

  39. Alex @ StockMarketMate

    Overspending is definitely a problem, but hey, it keeps the economy going, and more importantly it puts the Chinese to work. Too bad we don’t pay our people here in the States.
    Alex @ StockMarketMate recently posted..Is Investing in Procter and Gamble Stock a Gamble?My Profile

  40. Great infographic, although super scary at the same time. Unfortunately it seems whatever happens in the USA the UK isn’t far behind. Way too many people are spending beyond their means already, such is a spending driven society.
    WILD about Finance recently posted..Protecting yourself from Credit and Debit Card FraudMy Profile

  41. I also love infographics! Thanks for sharing this one. I was surprised that most American’s spend $1.33 to every dollar earned. I guess I shouldn’t be surprised though cause I already knew many are in debt. The only way that can happen is when one spends more than they earn.
    John @ Fearlessmen recently posted..4 Tips To Increase The Intensity Of Your WorkoutsMy Profile

  42. Americans may have all the wealth in the world as a whole populace but they are extremely naive in spending it. Many (read millions) live on borrowed money. They borrow money which they get very easily but they are extremely slow in repaying it. They think they own the world but very few realize they do not.
    Doable Finance recently posted..Talk to human instead of robotMy Profile

    • I completely agree with you here. There seem to be more people that are spending unwisely and that keeps us down as a whole. The US government doesn’t help matters here either.

  43. Dave@Your Financial Future

    A straight to the point infographic, I like it!

  44. It almost makes you wonder if we should go to a national sales tax concept. No more tax cheating by anyone and we can pretty much do away with the IRS all at once.
    Chad@thstockmarketandi recently posted..Know When to Fold ‘emMy Profile

    • We would never create a system that does away with the IRS. They wouldn’t allow that. I think they are trying to create a nationalized online sales tax to make it easier for businesses.

  45. Spending to feel good is something I’ve talked about on my website a bunch. This has got to be one of the greatest psychological temptations. Shopping does really make people feel better; albeit, it’s a temporary fix. Longer term, there needs to be something more than the local Macy’s to make you happy.

    Thanks for this terrific post!
    Sam @ Frugaling.org recently posted..Hack Your Data Plan To Save Money, Browse FasterMy Profile

Add Comment Register



Leave a Reply

Your email address will not be published. Required fields are marked *

*

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <strike> <strong>

CommentLuv badge

Check Out My New Favorite Investing Site: Motif InvestingLearn more