This is from a recent analysis by Investopedia. The numbers are averages so they won’t directly match your situation. And it doesn’t cover ALL aspects of life but focuses on ten common things that people spend money on in their lifetime.
The average American earns somewhere between $1.1M and $3M in their life. The number varies based on gender, education, etc. The CRAZY part is this Investopedia analysis says the average cost of living a normal life costs $3.4M, which is more than what most people make. (If you sum up our numbers, it’s slightly higher than $3.4M because of rounding and we adjusted the “Kids’ College” number to show all four years).
Some questions you might be wondering? For cars, the analysis is estimating you purchased a used car every six years (does not include repairs). For health insurance, it is showing the premiums you pay on average over your life. Retirement spending is based on projecting that you’ll need 80% of your income in retirement.
Since most of these costs are out of your control, focus on finding ways to increase your income. It might be from changing jobs, asking for a raise, and/or pursuing a side hustle. Try to save as much of each paycheck as you can and consistently invest the savings into index funds. Do this for decades and you’ll be sitting on a big pile of money regardless of inflation or how much the cost of college costs in the years ahead!
As always, reminding you to build wealth by following the two PFC rules: 1.) Live below your means and 2.) Invest early and often.
-Vivi & Shane
