Federal Reserve Report on Economic Well Being of US Households

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FRB: Survey of Household Economics and Decisionmaking

The Fed released it's annual report of Economic Well-Being of US Households. 100+ pages I've not sifted through yet but found this snipet that makes me sad.

When asked how their spending compares to their
income, 41 percent say that they spent less than they
made in the past year and 37 percent report that their
spending was equal to their income. However, one-in five
respondents report that their spending exceeded
their income.

So 57% spend everything they earn (or more for 20%)
This time of year when I give graduation presents I always write in a book or card that they (receipient) should remember to "Always spend less than you earn."
 
Always spend less then you earn, unless of course you are retired and in the distribution phase of your financial life. In some cases being in that 20% group is a great place to be :)
 
19% of surveyees were retired. Not sure how that factors in their answers obviously.

Someone having a royal pension and SS may claim they save more than they earn. Same thing for people counting capital gains as income in responding.

Also "only" 55 percent were employed. Hard to spend less than you earn if you are not earning anything (for various definitions of "earning", I know).
 
The report breaks those totals down by income level. It's not surprising that low income people save less than high income people. (page 21)

It also varies from year-to-year within households:

Among low-income respondents who did not experience an
economic hardship in the past year, 18 percent say
that their spending exceeded their income. However,
among low-income respondents who experienced a
hardship, 46 percent say that their spending exceeded
their income.
 
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