How Does Your Entertainment Spending Compare to Your Fellow Americans’?


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Spending money on entertainment is a luxury, but for many people, it also feels really necessary. After all, who wants to go through their life never seeing a movie or going to a concert or enjoying a trivia night out with friends?

The key, though, is to keep your entertainment spending reasonable so it doesn’t drain your bank account or — worse — leave you in debt. To see if you are spending a good amount, too much, or too little, it can sometimes be helpful to see what your peers are doing.

So, here’s the data on what the typical American spends to have fun.

Here’s what your fellow Americans are spending on entertainment

According to research from Ramsey Solutions, the typical American spends 4.7% of their income on entertainment.

This category of spending includes streaming services, pets, electronics purchases, and any hobbies that people like to take part in. It also means that the amount the average American spends on entertainment is around $288 per month.

This makes entertainment more expensive than some other kinds of discretionary spending. For example, the average person spends around 2.7% of their income, or about $162 a month, on apparel and services. That’s over $126 less than they are devoting to their entertainment expenditures.

Your overall budget impacts your entertainment spending

When you’re comparing your entertainment spending to what most people pay, it’s most helpful to look at the percentage of income spent. After all, someone who makes $20,000 a month is going to spend more on fun purchases than someone who makes $2,000 — and that’s OK.

The key is to not let things get out of hand and end up in credit card debt or find yourself unable to accomplish other financial goals because so much money is going to your knitting habit or your baseball card collection. And if you’re devoting a lot more than 4.7% of your income to entertainment, it just may be that you are overspending on this budget category.

After all, it’s a good idea to keep 20% of your money for long-term goals and limit fixed costs for necessities to 50% of your income. That leaves you with just 30% left over for everything else. You have a lot of other things to fit into that 30% besides just entertainment, such as grocery costs.

Are you spending too much?

You can see how much you are spending on entertainment by going over your past credit card and bank statements and adding up what your expenditures were for things like concerts, sporting events, movies, or other fun activities you participated in. If you use a budgeting app that categorizes your spending, this is pretty easy. If not, you can just input the numbers in a spreadsheet.

Once you’ve figured out what you’re spending, compare it to your income. If you are spending more than about 4.7% of your money on entertainment, it’s worth asking yourself if you can make some cuts — perhaps by looking for free activities in your area. You can find great no-cost events that appeal to people of all ages on local social media pages or via your library or community center.

It’s your money

The reality is, it is your money and your spending habits should match what matters to you. If you don’t care about clothing and would rather shop at thrift stores so you can afford to go see Taylor Swift’s Eras tour, then there’s absolutely nothing wrong with that at all — as long as you realize that there are tradeoffs to be made. You may have to sacrifice something else.

That’s why comparing your spending to others only goes so far in shedding light on what you should be doing with your own money. What you don’t want to do is sacrifice retirement savings or building up an emergency fund to spend more on entertainment. But if you’ve got the big stuff taken care of and paying for hobbies is what you want to do with the bulk of your money that’s left over, just make a plan for that and you should be fine.

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