How Much Does a Nutritionist Make a Year?

Nutritionists advise others on what to eat in order to lead a healthy lifestyle or achieve a specific health-related goal, such as losing weight or reducing blood pressure. Some nutritionists work directly with clients and patients in clinical settings, while others work in community settings like schools or health centers developing food plans and strategies for certain groups or demographics.

How much a nutritionist makes will depend on their qualifications, experience, and where they work, but the average nutritionist’s salary in the U.S. is $54,137 a year, according to ZipRecruiter.

Read on to learn more about how much a nutritionist can make a year and an hour, which cities and states pay the highest salaries, and other compensation and occupational benefits nutritionists enjoy.

What Are Nutritionists?

A nutritionist is an expert in using food to improve health and to prevent and manage disease. Nutritionists often advise people on what to eat to address a particular medical issue, such as hypertension, diabetes, or obesity. They may also be called upon to come up with a plan of action in situations where a treatment protocol, such as chemotherapy, impacts an individual’s overall diet or creates particular food sensitivities. Their exact role will depend on their specialization.

Being a nutritionist is not an ideal job for antisocial people, since you generally don’t work alone. Nutritionists can work in a variety of work settings, including:

•   Hospitals and doctors’ offices

•   Nursing homes

•   Gyms and recreation centers

•   Foodservice organizations

•   Food and beverage companies

•   Pharmaceutical companies

•   Government organizations

While the terms “nutritionist” and “dietician” are often used interchangeably, there are some key distinctions between them. A registered dietitian (R.D.) is qualified to diagnose and treat certain medical conditions. Nutritionists, on the other hand, tend to focus on general nutritional aims and behaviors.

Dietitians also tend to have more education and credentials, though that’s not always the case. Depending on the state they practice in, a nutritionist may be required to have specific qualifications, certifications, or a license. However, in some states, there are no such mandates — meaning anyone can use the title if they want to.

While every dietitian can be called a nutritionist, not every nutritionist is a dietitian.

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How Much Do Starting Nutritionists Make a Year?

While the average nutritionist’s salary is $54,137 a year, someone just starting out in the field may not be able to earn that figure as an entry-level salary. That said, a nutritionist coming into the profession with an advanced degree, such as a master’s or doctorate, and a license or other credentials, may be able to command a higher-than-average salary even when they are just starting out.


💡 Quick Tip: When you have questions about what you can and can’t afford, a spending tracker app can show you the answer. With no guilt trip or hourly fee.

What is the Average Salary for a Nutritionist?

While salaries for a nutritionist can range anywhere from $32,500 to $90,000, the average annual pay for a nutritionist in the U.S. is $54,137 a year, according to February 2024 data from ZipRecruiter.

Nutritionist’s typically get paid an annual salary but some may make money by the hour, which can range from $15.62 to $43.27.

How much a nutritionist makes, however, can vary significantly by education, credentials, experience, industry, and location. Advanced education, such as a master’s or doctoral degree, can generally help you qualify for a higher-than-average nutritionist’s salary.

Certain metropolitan areas also pay more than others. The top paying cities for nutritionists include: Berkeley, CA,; Renton, WA; Newark, CA; Woburn, MA; and Santa Monica, CA.

Recommended: Is a $100,000 Salary Good?

The Average Nutritionist Salary by State for 2024

As mentioned above, how much money a nutritionist makes can vary by location. What follows is a breakdown of how much a dietician makes per year, on average, by state (listed from highest to lowest).

State Average Annual Salary
Wisconsin $83,731
Alaska $81,044
Massachusetts $80,824
Oregon $80,772
New Mexico $80,529
North Dakota $80,527
Washington $80,268
Minnesota $79,381
Hawaii $78,914
Ohio $77,594
Colorado $76,879
Nevada $76,629
South Dakota $76,107
New York $75,623
Iowa $74,908
Rhode Island $74,814
Connecticut $74,143
Tennessee $74,087
Vermont $73,710
Utah $73,446
Mississippi $72,808
Delaware $72,604
Virginia $71,688
Illinois $71,072
Maryland $70,347
New Jersey $69,540
California $69,458
Louisiana $69,304
Pennsylvania $69,281
Nebraska $68,943
Kansas $68,520
Missouri $68,260
Maine $67,953
South Carolina $67,618
New Hampshire $67,312
Oklahoma $66,767
Idaho $66,358
Wyoming $66,356
North Carolina $66,222
Texas $65,834
Indiana $65,561
Arizona $64,205
Kentucky $64,000
Michigan $63,673
Montana $63,238
Alabama $62,448
Arkansas $60,647
Georgia $58,176
West Virginia $53,507
Florida $51,486

Source: ZipRecruiter

Nutritionist Job Considerations for Pay & Benefits

To get a job as a nutritionist or dietician, you may need:

•   A bachelor’s degree, ideally in dietetics, nutrition, food service systems management, clinical nutrition, or a related area.

•   Advanced degree (such as a master’s or doctoral degree)

•   Supervised training through an internship

•   A license (many, though not all, states require licenses for dietitians and nutritionists to practice)

•   Certification (many dietitians earn the Registered Dietitian Nutritionist credential, which requires a bachelor’s degree and completed a dietetic internship program).

Nutritionists who work on staff typically receive not only competitive pay but also a suite of benefits, which may include:

•   401(k)

•   Dental insurance

•   Disability insurance

•   Employee assistance program

•   Flexible spending account

•   Health insurance

•   Life insurance

•   Paid time off

•   Retirement plan

•   Vision insurance


💡 Quick Tip: Income, expenses, and life circumstances can change. Consider reviewing your budget a few times a year and making any adjustments if needed.

Pros and Cons of Becoming a Nutritionist?

As with any profession, becoming a nutritionist comes with both advantages and disadvantages. Here’s a closer look at the job’s pros and cons.

Pros of Becoming a Nutritionist

•   Opportunity to help people: Nutritionists help people by guiding them in their food choices and assisting them in reaching their health and nutritional goals, which can be highly rewarding.

•   Varied tasks and responsibilities: A nutritionist can enjoy meeting a variety of people in different contexts. No client or situation will be the same, and each will bring new challenges.

•   Can work in a variety of settings: Nutritionists can choose where they want to work, such as a hospital, nursing home, school, or gym. With extensive experience, a registered dietitian might open a private consulting practice and offer specialized services to their patients.

•   Strong job outlook: The U.S. Bureau of Labor Statistics predicts the employment of dietitians and nutritionists to grow 7% between 2022 and 2030, which is faster than the average for all occupations.

Cons of Becoming a Nutritionist?

•   May need an advanced degree and certification: Depending on where you want to work, you may need to obtain a master’s and/or certain certifications (on top of a bachelor’s degree).

•   Can be emotionally draining: Though generally a low-stress job, nutritionists may need to have frequent interactions with seriously ill patients, which can be emotionally challenging.

•   You constantly have to stay up to date: Nutrition is an evolving science, which means you’ll need to stay current on the latest nutritional guidelines, regulations, and research, and adjust your practice based on new developments.

•   Competition for top-paying jobs: While the job outlook is strong for nutritionists, jobs with competitive pay may receive a lot of applicants. Obtaining more than the minimum education and training required by the state, however, can set you apart from other job competitors.

Recommended: How Much Does a Nurse Make a Year?

The Takeaway

Working as a nutritionist can be a rewarding career for people who want to help others improve their health and lifestyle. Nutritionists can choose where they want to work and who they want to work with. A nutritionist’s salary can range from $32,500 to $90,000 or more depending on their certification, experience, and employer.

Whatever type of job you pursue, you’ll want to make sure your earnings can cover your everyday living expenses. To help ensure your monthly outflows don’t exceed your monthly inflows, you may want to set up a basic budget and check out financial tools that can help track your income and spending.

SoFi helps you stay on top of your finances.

FAQ

Can you make $100k a year as a nutritionist?

Earning $100K as a nutritionist is possible but isn’t typical. Nutritionist salaries range anywhere from $32,500 to $90,000 a year, according to ZipRecruiter. That said, getting an advanced degree and extra certifications and/or starting your own private practice could lead to a six figure income.

Do people like being a nutritionist?

People who want to help others and who have an interest in the science of food will enjoy being a nutritionist. There are plenty of opportunities for nutritionists in a variety of contexts.

Is it hard to get hired as a nutritionist?

Nutritionists and dieticians are currently in demand and job opportunities are expected to grow 7% between 2022 and 2030, which is faster than the average for all occupations, according to the U.S. Bureau of Labor Statistics.


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Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

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Fixed Expense Vs Variable Expense

Fixed Expenses vs Variable Expenses

A budget can be a great tool for managing your money and making it work harder for you. But typically a budget involves distinguishing between fixed expenses (those that stay constant, month after month) and variable expenses, which change over time.

Understanding where your money is going in these two ways can be helpful as you work to track and optimize how you earn, spend, and save.

What’s important to know is that each kind of expense can be lowered in many cases, and fixed vs. variable expenses don’t necessarily translate as needs vs. wants.

Here, you can learn more about these two ways you spend money and how to pay less. You will likely find smart tips for how you can budget even better.

Key Points

•   A budget helps manage money by distinguishing between fixed expenses (constant) and variable expenses (fluctuating).

•   Fixed expenses include rent, mortgage, insurance premiums, and gym memberships, while variable expenses include groceries, utilities, dining out, and entertainment.

•   Both fixed and variable expenses can be reduced, but cutting fixed expenses may require bigger life changes.

•   Examples of fixed expenses are mortgage payments, car payments, student loan payments, and subscription fees.

•   Examples of variable expenses are utilities, food, dining out, entertainment, and travel.

What Is a Fixed Expense?

Fixed expenses are those costs that you pay in the same amount each month — items like your rent or mortgage payment, insurance premiums (which can be an often-forgotten budget expense), and your gym membership. With fixed expenses, you know the amounts you will owe ahead of time, and they don’t change (or perhaps only annually).

Fixed expenses tend to make up a large percentage of a monthly budget since housing costs, typically the largest part of a household budget, are generally fixed expenses. This means that fixed expenses present a great opportunity for saving large amounts of money on a recurring basis if you can find ways to reduce their costs. However, cutting costs on fixed expenses may require bigger life changes, like moving to a different apartment — or even a different city, where the cost of living is lower.

Keep in mind, too, that not all fixed expenses are necessities — or big budget line items. For example, an online TV streaming service subscription, which is withdrawn in the same amount every month, is a fixed expense. It’s also a want as opposed to a need. Subscription services can seem affordable until they start accumulating and perhaps become unaffordable.

Examples of Fixed Expenses

Here are some examples of fixed expenses:

•   Mortgage payments or rent

•   Car payments

•   Student loan payments

•   Membership and subscription fees

•   Insurance premiums

•   Childcare or tuition payments

•   Internet or mobile phone fees

💡 Quick Tip: An online bank account with SoFi can help your money earn more — up to 4.00% APY, with no minimum balance required.

What Is a Variable Expense?

Variable expenses, on the other hand, are those whose amounts can vary each month, depending on factors like your personal choices and behaviors as well as external circumstances like the weather.

For example, in areas with cold winters, electricity or gas bills are likely to increase during the winter months because it takes more energy to keep a house comfortably warm. Grocery costs are also variable expenses since the amount you spend on groceries can vary considerably depending on what kind of items you purchase and how much you eat.

You’ll notice, though, that both of these examples of variable costs are still necessary expenses — basic utility costs and food. The amount of money you spend on other nonessential line items, like fashion or restaurant meals, is also a variable expense.

In either case, variable simply means that it’s an expense that fluctuates on a month-to-month basis, as opposed to a fixed-cost bill you expect to see in the same amount each month.

Examples of Variable Expenses

Here are specifics of what can constitute a variable expense:

•   Utilities

•   Food

•   Dining out

•   Entertainment

•   Personal care

•   Travel

•   Medical care

•   Gas

•   Property and car maintenance

•   Gifts

💡 Quick Tip: Your money deserves a higher rate. You earned it! Consider opening a high-yield checking account online and earn 0.50% APY.

Fixed vs Variable Expenses

To review the difference between variable vs. fixed expenses:

•   Fixed expenses are those that cost the same amount each month, like rent or mortgage payments, insurance premiums, and subscription services.

•   Variable expenses are those that fluctuate on a month-to-month basis, like groceries, utilities, restaurant meals, and movie tickets.

•   Both fixed and variable utilities can be either wants or needs — you can have fixed expense wants, like a gym membership, and variable expense needs, like groceries.

When budgeting, whether you are calculating expenses for one person or a family, it’s possible to make cuts on both fixed and variable expenses.

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Ways to Save on Fixed Expenses

Just because an expense is fixed doesn’t mean it can’t be downsized. Consider these possibilities.

Review Where Your Money Is Going

Take a look at your fixed expenses with a critical eye. Did your landlord raise your rent a significant sum? It might be time to look for more affordable options or get a roommate.

Has the number of subscription services you pay for crept up over time? You might save on streaming services by dropping a platform or two.

Refinance Your Loans

Interest rates rise and fall. If they are dropping, you might be able to save money by refinancing your loans, such as your mortgage. Check rates, and see if any offers are available that would reduce your monthly spend.

One option can be to get a lower payment over a longer period. You will likely pay more interest over the life of the loan, but it could help you out if you are living paycheck to paycheck right now.

Consolidate Your Debt

If you have a significant amount of high-interest debt, such as credit card debt, you might consider paying it off with a personal loan that offers a lower interest rate. This could save you money in interest and help lower your fixed expenses.

Bundle Your Insurance

Many insurance companies offer a lower premium if you sign up for both automotive and homeowners insurance with them. Check available offers to potentially reduce your costs.

Ways to Save on Variable Expenses

As you delve into variable vs. fixed expenses, here are some possible ways to minimize the ones that vary.

Scrutinize How You Spend

When you track your spending, you may find ways to cut back. For instance, you could look for ways to do your grocery shopping on a budget by planning meals in advance and shopping with a list. You might be able to challenge yourself to go for one month without, say, takeout food and the next without movies and then put the savings towards paying down debt.

Hit “Pause” on Impulse Purchases

If you feel the urge to buy something that isn’t in your spending plan, try the 30-day rule. Mark down the item and where you saw it and the price in your calendar for 30 days in the future. When that date arrives, if you still feel you must have it, you can find a way to buy it. But there is a very good chance that sense of urgency will have passed.

Try Different Budget Methods

If you find you need more help reining in your variable expenses, you might benefit from trying different budgeting tactics. There is the popular 50/30/20 budget rule, which says to allocate 50% of your take-home pay to needs, 30% to wants, and 20% to savings.

Other people prefer the envelope budget method or using a line-item budget to dig into where their money is going. You might also benefit from apps and digital tools to help you track where your money is going. Many banks offer these to their customers.

Check in With Your Money Regularly

The exact cadence is up to you, but it can be helpful to review your money on a regular basis. Some people like to check in on their account balances a few times a week; others prefer to review their accounts in-depth monthly. Find a system that works for you so you can see if your spending is on-target or going overboard.

Benefits of Saving Money on Fixed Expenses

If you’re trying to find ways to stash some cash, finding places in your budget to make cuts is a big key. And while you can make cuts on both fixed and variable expenses, lowering your fixed expenses can pack a hefty punch, since these tend to be big line items — and since the savings automatically replicate themselves each month when that bill comes due again.

Think about it this way: if you quit your morning latte habit (a variable expense), you might save a grand total of $150 over the course of a month — not too shabby, considering it’s just coffee. Even small savings can add up over time when they’re consistent and effort-free — it’s like automatic savings.

But if you recruit a roommate or move to a less trendy neighborhood, you might slash your rent (a fixed expense) in half. Those are big savings, and savings you don’t have to think about once you’ve made the adjustment: They just rack up each month. The savings you reap can help you pay down debt or save more, which can help you build wealth.

Saving Money on Variable Expenses

Of course, as valuable as it is to make cuts to fixed expenses, saving money on variable expenses is still useful — and depending on your habits, it could be fairly easy to make significant slashes.

As mentioned above, by adjusting your grocery shopping behaviors and aiming at fresh, bulk ingredients over-packaged convenience foods, you might decrease your monthly food bill. You could even get really serious and spend a few hours each weekend scoping out the weekly flyer for sales.

If you have a spendy habit like eating out regularly or shopping for clothes frequently, it can also be possible to find places to make cuts in your variable expenses. You can also find frugal alternatives for your favorite spendy activities, whether that means DIYing your biweekly manicure to learning to whip up that gourmet pizza at home. (Or maybe you’ll find a way to save enough on fixed expenses that you won’t have to worry as much about these habits.)

Saving and Budgeting With SoFi

Fixed expenses are those costs that are in the same amount each month, whereas variable expenses can vary. Both can be trimmed if you’re trying to save money in your budget, but cutting from fixed expenses can yield bigger savings for less ongoing effort.

Great budgeting starts with a great money management platform — and SoFi can help you with that, thanks to our dashboard and smart features.

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.


Better banking is here with SoFi, NerdWallet’s 2024 winner for Best Checking Account Overall.* Enjoy up to 4.00% APY on SoFi Checking and Savings.

FAQ

What are examples of variable expenses?

Variable expenses are changeable costs that include such items as groceries, utilities, entertainment, dining out, and credit card debt. They differ month by month.

What are examples of fixed expenses?

Fixed expenses are constant month after month. These can include such things as rent, car payments, student loan payments, and subscription services.

Are utilities fixed or variable?

Utilities may be a need vs. a want in life, but they often vary. For instance, if you live in a cold climate, your heating bill will rise in the winter. Or you might run the dishwasher more over the holiday season, increasing your bill.


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As an alternative to direct deposit, SoFi members with Qualifying Deposits can earn 4.00% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Qualifying Deposits means one or more deposits that, in the aggregate, are equal to or greater than $5,000 to an account holder’s SoFi Checking and Savings account (“Qualifying Deposits”) during a 30-day Evaluation Period (as defined below). Qualifying Deposits only include those deposits from the following eligible sources: (i) ACH transfers, (ii) inbound wire transfers, (iii) peer-to-peer transfers (i.e., external transfers from PayPal, Venmo, etc. and internal peer-to-peer transfers from a SoFi account belonging to another account holder), (iv) check deposits, (v) instant funding to your SoFi Bank Debit Card, (vi) push payments to your SoFi Bank Debit Card, and (vii) cash deposits. Qualifying Deposits do not include: (i) transfers between an account holder’s Checking account, Savings account, and/or Vaults; (ii) interest payments; (iii) bonuses issued by SoFi Bank or its affiliates; or (iv) credits, reversals, and refunds from SoFi Bank, N.A. (“SoFi Bank”) or from a merchant. SoFi members with Qualifying Deposits are not eligible for other SoFi Plus benefits.

SoFi Bank shall, in its sole discretion, assess each account holder’s Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving a Direct Deposit or $5,000 in Qualifying Deposits to your account, you will begin earning 4.00% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.

SoFi Bank reserves the right to grant a grace period to account holders following a change in Direct Deposit activity or Qualifying Deposits activity before adjusting rates. If SoFi Bank grants you a grace period, the dates for such grace period will be reflected on the APY Details page of your account. If SoFi Bank determines that you did not have Direct Deposit activity or $5,000 in Qualifying Deposits during the current 30-day Evaluation Period and, if applicable, the grace period, then you will begin earning the rates earned by account holders without either Direct Deposit or Qualifying Deposits until you have Direct Deposit activity or $5,000 in Qualifying Deposits in a subsequent 30-Day Evaluation Period. For the avoidance of doubt, an account holder with both Direct Deposit activity and Qualifying Deposits will earn the rates earned by account holders with Direct Deposit.

Members without either Direct Deposit activity or Qualifying Deposits, as determined by SoFi Bank, during a 30-Day Evaluation Period and, if applicable, the grace period, will earn 1.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances.

Interest rates are variable and subject to change at any time. These rates are current as of 12/3/24. There is no minimum balance requirement. Additional information can be found at https://www.sofi.com/legal/banking-rate-sheet.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

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19 Budgeting Categories For Your Budget

Building a budget can pay off quite literally: It provides guidelines for your money and helps you wrangle your spending and saving to achieve financial health. With smart planning, you can make your cash work harder for you and grow.

Many people think that a budget is all about deprivation, but it’s really about organization. A key step in developing a good budget is knowing how to categorize both your spending and saving. That can help you get a handle on where your money is going and how to make the most of it.

In this guide, you’ll learn how to divide your expenses into three main categories (namely, needs, wants, and savings), and then further separate things into smaller groups. This can help you truly understand your spending habits and optimize your finances.

Whether you’re just starting out on your independent financial life or if you’re looking to tweak your existing budget, this advice can help you better manage your budget categories and direct your spending goals.

Key Points

•   Personal budget categories help organize and track expenses for better financial management.

•   Common budget categories include housing, transportation, food, utilities, healthcare, debt payments, savings, entertainment, and personal care.

•   It’s important to customize budget categories based on individual needs and priorities.

•   Tracking expenses within each category helps identify areas for potential savings and adjustments.

•   Regularly reviewing and adjusting budget categories can help maintain financial balance and achieve financial goals.

9 Budget Categories for Needs

Of course, you probably are wondering what actually constitutes budgeting categories. First, focus on the needs of life.

This category, which represents the largest chunk, includes expenses that you must pay in order to live and work. You might think of these as things you actually need to survive — they’re sort of like the air, water, and food of your budget.

So, for instance, a fancy dinner out or a caramel latte are definitely food, but they wouldn’t necessarily go in this category. Groceries would though.

A good rule of thumb is to have this category take up about 50% of your after tax income. Housing and utilities are likely to take up the biggest chunk, but ideally no more than 30% of income.

The percentages, however, are just guidelines. Because the cost of living in different states varies across the country, you may need to adjust your budget according to where you live.

Recommended: How to Make a Budget in 5 Steps

1. Housing

Whether you pay rent or have a home mortgage, paying to keep a roof over your head is definitely a need. In addition, you may have property taxes to pay if you are a homeowner, and home maintenance costs can be part of this category for renters and owners alike.

2. Utilities

Depending on your living situation, you might pay for electricity, WiFi, heating fuel, telephone service, water, sanitation services, and other necessities.

3. Insurance

Having car, health, life, homeowners or renters insurance and possibly pet insurance can be important. You don’t want to wing it with this kind of protection (and auto insurance is required).

4. Groceries and Personal Care Items

Of course, you need food and toiletries as part of daily living. So the food you purchase to make meals and items like toothpaste go into your budget as “needs.” However, buying that $7 pack of cookies or $40 hair conditioner? Those might be better deemed “wants.”

5. Transportation

Car ownership expenses, public transportation, and the occasional Uber to get to urgent care can all be considered necessities.

6. Clothing

Yes, you need a warm winter coat if you live in the climates that get chilly, plus boots. And you need basic garments to wear to work and on your off-hours. However, if you buy a cool jacket because you love it or yet another pair of cute shoes since they are on sale, those are not vital to your survival and should go in the “wants” category.

7. Debt

Minimum payments on outstanding debts like credit cards, student loans, auto loans, or personal loans would also go into the 50% needs portion.

8. Parenting Expenses

Child care, as well as child support or alimony payments, go into the “must” bucket of your budget. Those are not discretionary expenses.

9. Healthcare

Depending on your insurance coverage, you may have expenses related to staying well, such as copays, prescription costs, and the like. Treating yourself to a massage that isn’t medically required? That’s not a “need” but a “want.”



Recommended: Input your monthly income to find out how much to spend on essentials, desires, and savings with our 50/30/20 Budget Calculator.

6 Spending Categories for Wants

These are expenses that don’t qualify as needs and don’t include your savings and payments towards debt. Though it can sometimes be tricky to separate needs from wants, if you can live and earn your income without it, then it’s probably a want.

If you can live and earn your income without it, then it’s probably a want.

This is where you could put spending on clothing outside of what you need on a day-to-day basis, dinner and drinks out with friends, going to the movies, gym memberships, personal care, and miscellaneous spending.

As a general guideline, this category shouldn’t take up more than 30% of your spending. While you may need to give and take depending on your situation, seeing how much you are spending on wants in black and white may cause you to start thinking more carefully about these expenditures.

1. Clothing and Personal Care

Treated yourself to a new but unnecessary shirt as part of a little retail therapy? Took yourself to the spa for a day? Or bought yourself a fancy watch since you got a promotion? Those are all wants. They aren’t necessarily bad things, but be clear that they are not vital to your survival.

2. Dining Out and Drinking

It’s part of life to meet friends and loved ones for happy hour or a nice meal, or to get a bubble tea while running errands on the weekend. Or maybe you don’t feel inspired to cook so you order some Pad Thai for pickup or delivery. These are all discretionary food expenses vs. those that are vital to your survival.

3. Entertainment

While entertainment can definitely enrich your life, it goes into the “wants” category. This includes things like concert, play, and movie tickets; books and magazines; cable and streaming services; downloading music; and attending festivals and fairs.

4. Gym Memberships, Self-care, and Grooming

You could just workout for free at home while watching a Youtube video, so health club memberships, yoga or Pilates classes are “wants.” Same goes with self-care and grooming: Facials, manicures, and the like are considered discretionary. That $50 hair conditioner you can’t live without? That isn’t a “need” either.

5. Travel Expenses

If you are traveling for business purposes to pitch a new account, that’s more of a “need,” but otherwise, a getaway is a “want.” So tally up any airfare, rental car costs, hotel or Airbnb, food, and tour/attraction tickets, and consider them “wants.”

6. Home Decor

If your mattress bites the dust and you replace it, that is a “need,” but deciding to buy a new couch because your home could use a spruce-up is a “want.”

💡 Quick Tip: Want a simple way to save more everyday? When you turn on Roundups, all of your debit card purchases are automatically rounded up to the next dollar and deposited into your online savings account.

Categorizing Your Savings

Under the 50/20/30 rule, it’s suggested that savings take up 20% of your post-tax income. This is the money you’re putting toward your retirement, emergency fund, and other savings. You can also put payments against debt above minimums here since this can ultimately save money on interest, it’s considered savings.

Here are specifics.

1. Emergency Fund

Financial experts recommend having three to six months’ worth of basic living expenses socked away in case of emergency. This could mean job loss or receiving an unexpected and major medical or car repair bill. You don’t want to have to resort to using your credit card for such things.

Recommended: Use our emergency fund calculator to determine how much you should be savings for an emergency fund.

2. Retirement Savings

If you aren’t offered a 401(k) or something similar at work, you can still contribute to retirement savings account like an individual retirement account (IRA). You might be able to find a low-fee, or no-fee, IRA online.

Recommended: How to Open an IRA: Step-by-Step Guide

3. Other Short- and Long-Term Savings

You’ll also probably want to fund non-retirement savings goals, such as saving for a summer vacation or the down payment on a house. It can be a good idea to open a separate savings account, ideally where you can earn higher interest than a standard savings account, such as a money market fund, online savings account, or a checking and savings account.

To make sure saving happens each month, you may also want to set up an automatic transfer from your checking account into this account on the same day every month, perhaps after your paycheck gets deposited.

4. Additional Debt Payments

If you can pay more than the minimum on your credit card bill or make extra payments on your loans, that can decrease what you are spending on interest. That in turn can help increase your overall financial health and wealth.

Get up to $300 when you bank with SoFi.

No account or overdraft fees. No minimum balance.

Up to 4.00% APY on savings balances.

Up to 2-day-early paycheck.

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Why Categorizing Your Budget Is Important

Categorizing your budget is important because it can give you a much better sense of where your money goes versus just paying whatever bills turn up.

•   When you see how much cash goes towards the different kinds of “needs,” “wants,” and savings, you can better manage your cash. Tracking your spending can bring greater financial insight.

•   Also, as you categorize and tally your spending, you may see that much more than 30% of your take-home pay is going to ”wants.” That could convince you to recalibrate and cut back.

•   Or you might notice that you are spending way more than 50% on “needs.” This can happen when you are just starting out in your career or if you live somewhere with a high cost of living. Again, you might look to lower costs.

Finalizing Your Budget Categories and Getting Started

Now that you have an idea of how to allocate your income based on standard budgeting categories, you may want to start building out your budgeting plan.

If you find that your monthly expenses (including savings) are higher than your monthly take-home income, you’ll likely want to make some adjustments. One of the easiest places to do this is within the “wants” bucket.

Here, you can scout for unnecessary expenses you may be able to do without. For instance, maybe you would be fine saving on streaming services by dropping one or two platforms, cooking at home a few more times per week, or cutting back on clothing purchases.

If your “musts” are eating up more than 50%, perhaps you want to consider moving to a less expensive home or taking in a roommate. Another option could be to start a side hustle to bring in more income or train up for a higher-paying line of work.

It can help to keep in mind that the 50/30/20 guideline is just that, a guideline. Everyone’s situation is different and your numbers may vary depending on many different factors, including where you live, your income, how much debt you have, and your savings and investment goals. (There are also other budgeting methods to try, if you like.)

The Takeaway

Putting expenses into categories and coming up with a spending plan can bring significant benefits. These include being able to pay off debt, saving up for short-term goals (such as an emergency fund, a vacation, or a down payment on a home), and funding your retirement.

The 50/20/30 rule can give you an general idea of how to allocate your income based on standard budgeting categories and help you start building out your budgeting plan.

Need some help keeping track of spending? Many financial institutions offer tools that can help you see where your money is going and make the most of your savings.

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.


Better banking is here with SoFi, NerdWallet’s 2024 winner for Best Checking Account Overall.* Enjoy up to 4.00% APY on SoFi Checking and Savings.

FAQ

What are the 4 main categories in a budget?

There are different ways to categorize a budget, but commonly, people focus on their take-home pay, their spending on their “wants,” their “needs,” and how much they save.

What categories should you have in a budget?

When building a budget, it’s important to know how much income you have after taxes, what are the expenses that are necessary for your survival, what is your usual discretionary spending (which some people call the “fun stuff” in life), and how much are you saving. Within the last three buckets, you can subdivide into more specific categories.

How do you organize a budget?

One good budgeting technique is the 50/30/20 budget rule. This principle says that 50% of your take-home pay should go towards necessities, 30% to discretionary spending, and the remaining 20% should be saved.


SoFi® Checking and Savings is offered through SoFi Bank, N.A. ©2024 SoFi Bank, N.A. All rights reserved. Member FDIC. Equal Housing Lender.
The SoFi Bank Debit Mastercard® is issued by SoFi Bank, N.A., pursuant to license by Mastercard International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.


SoFi members with direct deposit activity can earn 4.00% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. Direct Deposit means a recurring deposit of regular income to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government benefit payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Direct Deposit”) via the Automated Clearing House (“ACH”) Network during a 30-day Evaluation Period (as defined below). Deposits that are not from an employer or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, or are non-recurring in nature (e.g., IRS tax refunds), do not constitute Direct Deposit activity. There is no minimum Direct Deposit amount required to qualify for the stated interest rate. SoFi members with direct deposit are eligible for other SoFi Plus benefits.

As an alternative to direct deposit, SoFi members with Qualifying Deposits can earn 4.00% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Qualifying Deposits means one or more deposits that, in the aggregate, are equal to or greater than $5,000 to an account holder’s SoFi Checking and Savings account (“Qualifying Deposits”) during a 30-day Evaluation Period (as defined below). Qualifying Deposits only include those deposits from the following eligible sources: (i) ACH transfers, (ii) inbound wire transfers, (iii) peer-to-peer transfers (i.e., external transfers from PayPal, Venmo, etc. and internal peer-to-peer transfers from a SoFi account belonging to another account holder), (iv) check deposits, (v) instant funding to your SoFi Bank Debit Card, (vi) push payments to your SoFi Bank Debit Card, and (vii) cash deposits. Qualifying Deposits do not include: (i) transfers between an account holder’s Checking account, Savings account, and/or Vaults; (ii) interest payments; (iii) bonuses issued by SoFi Bank or its affiliates; or (iv) credits, reversals, and refunds from SoFi Bank, N.A. (“SoFi Bank”) or from a merchant. SoFi members with Qualifying Deposits are not eligible for other SoFi Plus benefits.

SoFi Bank shall, in its sole discretion, assess each account holder’s Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving a Direct Deposit or $5,000 in Qualifying Deposits to your account, you will begin earning 4.00% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.

SoFi Bank reserves the right to grant a grace period to account holders following a change in Direct Deposit activity or Qualifying Deposits activity before adjusting rates. If SoFi Bank grants you a grace period, the dates for such grace period will be reflected on the APY Details page of your account. If SoFi Bank determines that you did not have Direct Deposit activity or $5,000 in Qualifying Deposits during the current 30-day Evaluation Period and, if applicable, the grace period, then you will begin earning the rates earned by account holders without either Direct Deposit or Qualifying Deposits until you have Direct Deposit activity or $5,000 in Qualifying Deposits in a subsequent 30-Day Evaluation Period. For the avoidance of doubt, an account holder with both Direct Deposit activity and Qualifying Deposits will earn the rates earned by account holders with Direct Deposit.

Members without either Direct Deposit activity or Qualifying Deposits, as determined by SoFi Bank, during a 30-Day Evaluation Period and, if applicable, the grace period, will earn 1.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances.

Interest rates are variable and subject to change at any time. These rates are current as of 12/3/24. There is no minimum balance requirement. Additional information can be found at https://www.sofi.com/legal/banking-rate-sheet.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

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What Are the Average Monthly Expenses for One Person?

It’s human nature to wonder how you compare to everyone else. And that goes for money too. For instance, are you spending more or less on housing? Food? Transportation?

The average single person spends about $3,405 per month, according to recent data. But that will vary with where and how you live. Still, knowing where you stand can help you budget better and see how your spending stacks up against other people’s outflow of cash.

Here, you’ll get a sense of how much an average person might spend per month so you can consider how your own budget looks.

Key Points

•   The average monthly expenses for one person can vary, but the average single person spends about $3,405 per month.

•   Housing tends to consume the highest portion of monthly income, with the average annual spending on housing at $1,885 per month per person.

•   Transportation costs can vary, but the average household spends around $913 per month on transportation.

•   Health care expenses can vary, with a single adult in New York City paying about $575 to $776 per month for health insurance.

•   Food expenses can range from $300 to $540 per month, depending on factors like age, income, and location.

Average Monthly Expenses in 2023

Housing

Housing tends to consume the highest portion of monthly income. Using U.S Department of Labor statistics, the average annual spending on housing was $1,885 per month per person. Typically, single people living alone (or with others but paying their own) may devote more of their monthly income to housing than those living as a family.

Costs can also vary significantly depending on the cost of living in your area. That’s important to consider when considering costs and making a monthly budget.

A single person living in a studio in New York City, for example, can expect to spend significantly more than someone living in a rural or suburban community. According to RentHop, the average price for a studio (one-room) rental in New York City was $3,450 in spring of 2023.

💡 Quick Tip: Banish bank fees. Open a new bank account with SoFi and you’ll pay no overdraft, minimum balance, or any monthly fees.

Transportation

Transportation costs can vary depending on your mode of transport (i.e., car vs. bus vs train), as well as what region of the country you live in.

But one thing that holds true for many of us: Transportation often accounts for the second-largest budget item, after housing.

The average household shells out around $913 per month on transportation, including car or public transportation, gas, insurance and other related expenses. A single person could expect to pay half or even a quarter of that amount, depending on their particular situation, such as whether they are making car payments or using public transportation.

And, of course, you can take steps to lower those costs as needed, like learning how to save money on gas.

Health Care

Health care expenses can vary depending on each individual’s circumstances, and can also rise and fall from one month to the next.

For example, there may be some months where unexpected medical costs crop up (such as emergency care), and other months where you only need to cover insurance premiums and preventive care appointments.

Cost varies by location as well.

For instance, a single adult living in New York City can expect to pay about $575 to $776 a month for health insurance (or more).

A single adult living in Boise, Idaho, on the other hand, can anticipate shelling out roughly $274 to $422 (depending on specifics) per month for those health insurance costs.

Recommended: How to Save Money Daily

Food

Everyone’s gotta eat, and the average single person spends about $300 to $540 per month.

This figure ranges depending on your age, income, gender, eating habits, and where you live.

The wide variability in spending in this category shows that food can be an area where consumers can find savings if they need to reduce monthly spending (such as getting serious about meal planning and choosing lower cost brands at the supermarket).

💡 Quick Tip: When you overdraft your checking account, you’ll likely pay a non-sufficient fund fee of, say, $35. Look into linking a savings account to your checking account as a backup to avoid that, or shop around for a bank that doesn’t charge you for overdrafting.

Cell Phone

Average monthly wireless fees run about $166 for a plan, which might include multiple lines.

The good news? If your budget is particularly tight, you could spend as little as $10 a month for basic service with no data.

Utility Bills

After you’ve saved up and carefully budgeted to buy a home, you probably don’t want to be surprised by a higher-than-expected utility bill. The average monthly electricity bill was $121 per month recently, but that figure can of course vary.

A number of factors go into utility costs, including home size, where you set the thermostat, type of insulation you have, the climate, as well as what part of the country you live in (since rates vary across the country). For instance, those who live in Utah paid $80.87 a month while those in Hawaii shelled out $177.78 per month on average.

Clothing

The average adult spends about $146 on clothing per month. If your budget is tight, this is one category where you can often pare back spending, whether by shopping your closet, hitting the sales racks, or bringing older clothes that need repairs or fit adjustments to the tailor. A clothing swap with friends can be another option.

💡 Quick Tip: If you’re faced with debt and wondering which kind to pay off first, it can be smart to prioritize high-interest debt first. For many people, this means their credit card debt; rates have recently been climbing into the double-digit range, so try to eliminate that ASAP.

Gym Memberships

The average gym membership runs anywhere from $20 to $60 per person per month, which could be a good deal if you use it regularly.

If, however, you aren’t really using that membership or it’s too pricey for your budget, you could try going outside and hitting the pavement, joining an exercise meetup group, watching YouTube videos, and/or picking up some dumbbells and exercise bands to workout at home.

Get up to $300 when you bank with SoFi.

No account or overdraft fees. No minimum balance.

Up to 4.00% APY on savings balances.

Up to 2-day-early paycheck.

Up to $2M of additional
FDIC insurance.


Getting Your Monthly Expenses in Check

Knowing the average cost of living can be helpful when you’re trying to determine how much of your budget you may need to allocate to different spending categories. (If you’re thinking, “What budget?” it’s likely a wise move to get busy creating a budget.)

Recommended: Cost of Living per State

These average monthly expenses shared above, though, are just that — averages.

To fine-tune your budget, and make sure your spending is in line with both your income and your goals, it’s a good idea to track your own spending (which means every cash/debit card/credit card payment and every bill you pay) for a month or two.

There are a few options for tracking spending. One easy method is to make all purchases for the month on one debit card or credit card, then, at the end of the month, take note of all the purchases made.

Another option is to use an app (your bank may provide a good one) that can help you log and track your spending. At the end of the month, you can then see everything you spent, as well as allocate each expense into key categories, such as housing, transportation, food, health care, etc.

You can then see how your spending compares to national averages, as well as where you might want to tweak things. For instance, if you don’t have enough at the end of the month to put any money away into your retirement fund, you might want to pare back non-essential spending (such as restaurants, clothing, gym memberships).

The same holds true if you haven’t been able to put money towards an emergency fund, which is an important safety net if you were to endure an emergency such as a job loss.

Recommended: Use our emergency fund calculator to figure out your ideal emergency fund amount.

The Takeaway

Whether you’re creating a new budget or refreshing an old one, you’ve probably noticed how important (and tricky) it is to get your monthly expenses right.

Knowing the average amount people spend to live can help you figure out how your spending stacks up and, if you’re just starting out, help to ensure you’re budgeting enough for each category.

To see how your actual spending compares to national averages, you may want to track your daily spending for a month (or more), and then set up certain spending limits to keep your purchases in line with your income, as well as your savings goals.

Better banking is here with SoFi, NerdWallet’s 2024 winner for Best Checking Account Overall.* Enjoy up to 4.00% APY on SoFi Checking and Savings.


SoFi® Checking and Savings is offered through SoFi Bank, N.A. ©2024 SoFi Bank, N.A. All rights reserved. Member FDIC. Equal Housing Lender.
The SoFi Bank Debit Mastercard® is issued by SoFi Bank, N.A., pursuant to license by Mastercard International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.


SoFi members with direct deposit activity can earn 4.00% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. Direct Deposit means a recurring deposit of regular income to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government benefit payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Direct Deposit”) via the Automated Clearing House (“ACH”) Network during a 30-day Evaluation Period (as defined below). Deposits that are not from an employer or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, or are non-recurring in nature (e.g., IRS tax refunds), do not constitute Direct Deposit activity. There is no minimum Direct Deposit amount required to qualify for the stated interest rate. SoFi members with direct deposit are eligible for other SoFi Plus benefits.

As an alternative to direct deposit, SoFi members with Qualifying Deposits can earn 4.00% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Qualifying Deposits means one or more deposits that, in the aggregate, are equal to or greater than $5,000 to an account holder’s SoFi Checking and Savings account (“Qualifying Deposits”) during a 30-day Evaluation Period (as defined below). Qualifying Deposits only include those deposits from the following eligible sources: (i) ACH transfers, (ii) inbound wire transfers, (iii) peer-to-peer transfers (i.e., external transfers from PayPal, Venmo, etc. and internal peer-to-peer transfers from a SoFi account belonging to another account holder), (iv) check deposits, (v) instant funding to your SoFi Bank Debit Card, (vi) push payments to your SoFi Bank Debit Card, and (vii) cash deposits. Qualifying Deposits do not include: (i) transfers between an account holder’s Checking account, Savings account, and/or Vaults; (ii) interest payments; (iii) bonuses issued by SoFi Bank or its affiliates; or (iv) credits, reversals, and refunds from SoFi Bank, N.A. (“SoFi Bank”) or from a merchant. SoFi members with Qualifying Deposits are not eligible for other SoFi Plus benefits.

SoFi Bank shall, in its sole discretion, assess each account holder’s Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving a Direct Deposit or $5,000 in Qualifying Deposits to your account, you will begin earning 4.00% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.

SoFi Bank reserves the right to grant a grace period to account holders following a change in Direct Deposit activity or Qualifying Deposits activity before adjusting rates. If SoFi Bank grants you a grace period, the dates for such grace period will be reflected on the APY Details page of your account. If SoFi Bank determines that you did not have Direct Deposit activity or $5,000 in Qualifying Deposits during the current 30-day Evaluation Period and, if applicable, the grace period, then you will begin earning the rates earned by account holders without either Direct Deposit or Qualifying Deposits until you have Direct Deposit activity or $5,000 in Qualifying Deposits in a subsequent 30-Day Evaluation Period. For the avoidance of doubt, an account holder with both Direct Deposit activity and Qualifying Deposits will earn the rates earned by account holders with Direct Deposit.

Members without either Direct Deposit activity or Qualifying Deposits, as determined by SoFi Bank, during a 30-Day Evaluation Period and, if applicable, the grace period, will earn 1.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances.

Interest rates are variable and subject to change at any time. These rates are current as of 12/3/24. There is no minimum balance requirement. Additional information can be found at https://www.sofi.com/legal/banking-rate-sheet.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.

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How to Stop Spending Money: 7 Strategies to Curb Spending

If you feel that, despite your best intentions, your hard-earned money gets frittered away, you may need to curb your spending.

Sure, shopping is part of life, but there are many reasons why it’s easy to overdo it: the convenience of tapping and swiping. All the tempting, bright, and shiny things seen on social media. A boring afternoon that becomes less tedious when you browse for a new laptop.

Spending too much and too often can have consequences. The average American currently has almost $8,000 in high-interest credit card debt, and some of that could be due to overspending.

Fortunately, there are effective ways to tackle this issue and take better control of your money. Read on to learn more about what can cause you to overspend plus tactics that can help you better control your spending.

Key Points

•   To stop spending money, individuals should identify their spending triggers and understand the emotions behind their spending habits.

•   Creating a budget and tracking expenses helps individuals gain awareness of where their money is going.

•   Practicing delayed gratification by waiting before making non-essential purchases can curb spending.

•   Finding alternative activities or hobbies that bring joy without requiring excessive spending is beneficial.

•   Seeking support from friends, family, or professionals can help individuals stay accountable and make positive changes to their spending habits.

7 Ways to Curb Your Spending Problem

If you find yourself being a bit too freewheeling with your spending, recognizing the issue is step one (good job!). Then, it’s time to try some tactics to help you cut back.

1. Mapping Out a Budget

Without a budget, you can spend money mindlessly, without thinking much about it. Mapping out your spending patterns and essential expenses by creating a household budget can help you see where your dollars go and figure out where to cut back. In short, it can teach you how to be better with money.

•  To create a budget, check your income and then track your current spending patterns. Review your monthly bank statements or receipts from recent purchases. You can also use a free tool to track your spending, which makes the process even easier.

•  Identify essential expenses vs. non-essential ones. Necessary spending includes such items as housing, groceries, utilities, healthcare costs, and transportation.

Non-essential costs are things like eating out, leisure travel, and entertainment. You may be surprised to see how small daily purchases — such as eating out for lunch every work day — can add up to a lot of money spent over the course of each month.

•  Once you figure out how much you tend to spend in each expense category, it may be easier to identify places where you could cut back and reduce excessive spending. A monthly budget can allot specific amounts of money for vital expenditures, savings, investing for retirement, and fun activities, too. There are an array of different budget methods. It can be wise to try a couple until you find one that works best for you.

Recommended: Input your monthly income to find out how much to spend on essentials, desires, and savings with our 50/30/20 Calculator.

2. Calculating Hourly Earnings

A night out may not seem like a huge splurge in the moment — especially when compared to your total earnings for the month. But, that same expense can quickly appear more significant when you tabulate how many hours of work are needed to pay for it.

To try this approach, figure out your hourly pay: Divide your after-tax pay by the number of hours worked. If you get paid twice a month and work a 40-hour week, divide your total earnings by 80 (two weeks times 40 hours). Then use that insight:

•  For instance, a birthday dinner and drinks with friends that costs $200 would translate to eight hours of work if you earn $25 per hour.

Whether that spend feels worth it is a personal decision. However, many people find that determining how much you earn per hour may provide incentive to stop spending. Or it might nudge you to consider carefully before you spend to make sure the expense feels worth it.

Recommended: 15 Creative Ways to Save Money

3. Understanding What Triggers Spending

Whether it’s the gourmet food section at the grocery store, the Instagram influencer with the covetable closet of clothes, or that friend who drops big bucks on concert tickets, for all of us, the urge to spend can be triggered by emotions and outside influences.

Even something as seemingly innocuous as the physical shopping environment — think about in-store displays, prominent markdown messaging, and subtler cues like store layout — can trigger people to want to spend. When figuring out how to stop spending money, it can be key to understand which emotional or psychological cues make you take out your wallet.

There are a couple ways that understanding your spending triggers may help. For starters, you might plan ahead to avoid scenarios that make you more prone to spend. And, when the urge to shell out cash strikes, evaluate whether the purchase is really necessary or if it mainly feels good in the moment. These tactics can help you manage your money and feel in control.

💡 Quick Tip: Want to save more, spend smarter? Let your bank manage the basics. It’s surprisingly easy, and secure, when you open an online bank account.

4. Shopping with a Plan

Of course you can’t always avoid spending triggers. We all have to shop sometimes. Still, it may be easier to avoid the temptation to overspend by creating a shopping list and sticking to it. That’s one way to spend wisely.

For example, going grocery shopping may be easiest to do right after work. But that time of day may also coincide with when you’re ravenous. Hungry shoppers, research shows, tend to buy more non-essential items.

Creating a set list of items to pick up can help you focus on what you really need — rather than buying out of want.

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5. Finding It Cheaper

Of course, there are times when you’ll choose to spend money on specific purchases. Comparison shopping may help you cut back on expenses. You may be able to find the item cheaper elsewhere. Or, you might find a similar brand for less.

It’s also a good idea to keep an eye out for discounted pricing. Holding off on a bigger purchase until it goes on sale (say, at holiday time) may lead to additional savings.

Need some other ideas for managing your money better this way? Consider these:

•  Try couponing and discount codes. There are many sites that can help, such as Coupons.com and Retailmenot.com.

•  Join a warehouse club. These stores can be cheaper than your local supermarket. Are the quantities too big for your household? Share them with friends and split the cost.

•  Shop where you get rewards that lower your costs. Loyalty can pay off.

6. The 30 Day Rule

Want another idea for how to quit spending money? Before you buy something, take some time to think it over, rather than giving in to impulse spending.

Studies show that activities that provide instant gratification, such as impulse shopping, activate feel-good chemicals in the brain. But, if that purchase comes at the expense of your long-term goal to save, buying now could set you up for guilt after spending later on.

If you see an item of significant expense that triggers a “gotta have it” feeling, put a note in your calendar for 30 days later. Write down the item, the price, and where you saw it.

When that date rolls around, if you still feel you must have the object of your affection, you can decide to get it. But there’s a very good chance that your sense of urgently needing it will have passed.

7. A No-Spend Challenge

You can gamify your spending to help you save. Try a no-spend challenge; you may want to have a friend or family member join you to make it more fun and help you stay accountable.

In a no-spend challenge, you typically pick a period of time during which you will only buy essentials. One popular option is a No-Spend September. Or you might declare that you won’t buy any fancy coffees for a week and put the money saved towards debt. Then, the next month, you could not buy any personal care items that are luxuries (a pricey new lipstick just because it’s pretty) rather than necessities (yes, it’s okay to buy toothpaste when you run out!).

5 Factors That Contribute to Your Spending Problem

Now that you understand some ways to stop spending money, it can also be helpful to understand and avoid some of the things that can lead you towards doling out too much cash.

1. Social Media

Social media can be fun and exciting. It introduces you to new people, new ideas, new products and services, and, consequently, new ways to spend money. As you scroll, you are likely to be exposed to dozens of influencers and offers that can encourage you to buy things you never previously knew about or wanted.

One way to fight back? It may be helpful not to link your credit card to your social media accounts to minimize the possibility of overspending.

2. Emails and Text Messages

Here’s another way your digital life can contribute to overspending: If you get emails or text messages heralding new products, sales, and other offers, it can trigger you to buy.

For example, if your favorite home design retailer sends you a message saying their most popular throw pillows are almost sold out, that may get you to buy. Or if you get emails from a favorite athletic brand saying they are holding a “buy one, get one” sale, you might decide to go ahead and shop so you can get that free garment…even though you actually don’t need anything. Unsubscribing from these marketing messages can be a budget-wise move.

3. Retail Therapy

Many of us shop as a pick-me-up. If you’re having a bad day at work, had a fight with your significant other, or are stressed about almost anything, hitting some stores can be a welcome distraction. However, this can also lead you to buy things that you neither need nor craved before you set foot inside the shop.

Recognizing what triggers retail therapy can help you short-circuit this habit. Or you can try the tactic of leaving your credit cards at home when you go browsing at boutiques.

4. FOMO

FOMO stands for “fear of missing out,” and it can drive a lot of impulse purchases. If your friend says you must try a pricey new restaurant in your neighborhood or your coworker suggests a life-changing hairstylist, you might feel as if, yes, you must spend money on these things. It can make you feel as if you are part of the in-crowd or “keeping up with the Joneses.”

Understanding this FOMO spending dynamic can be a major step towards stopping this kind of overspending.

5. Lifestyle Creep

Lifestyle creep occurs when, as you earn more, you spend more. Many people think that getting, say, a 10% raise is license to go spend 10% more. However, this can just keep your finances at a baseline level rather than helping you build wealth and reach longer-term goals.

As your income climbs, it can be wiser to raise your contributions to your retirement fund or your debt payments rather than heading to the mall to celebrate.

Budgeting With a SoFi Savings Account

Naturally, it’s not possible to stop spending money altogether. But adopting a few smart habits, such as budgeting, understanding your spending triggers, and shopping with a list, could help you take control of your money and spend less.

The right banking partner can help with budgeting, tracking your spending, and putting your money to work for you.

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.


Better banking is here with SoFi, NerdWallet’s 2024 winner for Best Checking Account Overall.* Enjoy up to 4.00% APY on SoFi Checking and Savings.

FAQ

What is it called when you can’t stop spending money?

There are various terms used to describe the issue of spending too much, such as compulsive shopping, impulsive shopping, shopping addiction, and pathological buying.

How do you stop spending so much money?

There are many tactics you can use to stop spending so much money, such as budgeting wisely, understanding your spending triggers, sleeping on it or waiting 30 days, and only shopping when you have a plan.

Is overspending a mental disorder?

Sometimes called money dysmorphia or money disorder, overspending may be considered a psychological disorder. It involves a person being preoccupied with money, spending it, and financial status. It can trigger feelings of anxiety and inadequacy. In addition, compulsive shopping can be considered a form of obsessive-compulsive or impulse-control disorder.

How much is too much spending?

There is no set amount that equals too much spending. Rather, it occurs when spending negatively impacts your financial and personal life. If you can’t stick to a budget, are burdened by debt, or find that your preoccupation with shopping interferes with your work or relationships, then your spending could be excessive.

How do you stop the cycle of overspending?

You can stop the cycle of overspending in a variety of ways, including creating and sticking to a budget, planning your purchases (whether a big-ticket item or just weekly groceries), using cash, and going on a spending freeze.

What is the root cause of overspending?

Overspending has various causes. It could be due to boredom, lifestyle creep, FOMO (fear of missing out), and wanting to reward oneself or boost one’s mood, among other reasons.

Why are you always overspending?

People can overspend for an array of reasons, such as not having a budget that works, wanting to treat themselves, and trying to keep up with social media influencers or with friends and coworkers. These habits can be broken with a bit of self-knowledge and focus.


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SoFi members with direct deposit activity can earn 4.00% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. Direct Deposit means a recurring deposit of regular income to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government benefit payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Direct Deposit”) via the Automated Clearing House (“ACH”) Network during a 30-day Evaluation Period (as defined below). Deposits that are not from an employer or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, or are non-recurring in nature (e.g., IRS tax refunds), do not constitute Direct Deposit activity. There is no minimum Direct Deposit amount required to qualify for the stated interest rate. SoFi members with direct deposit are eligible for other SoFi Plus benefits.

As an alternative to direct deposit, SoFi members with Qualifying Deposits can earn 4.00% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Qualifying Deposits means one or more deposits that, in the aggregate, are equal to or greater than $5,000 to an account holder’s SoFi Checking and Savings account (“Qualifying Deposits”) during a 30-day Evaluation Period (as defined below). Qualifying Deposits only include those deposits from the following eligible sources: (i) ACH transfers, (ii) inbound wire transfers, (iii) peer-to-peer transfers (i.e., external transfers from PayPal, Venmo, etc. and internal peer-to-peer transfers from a SoFi account belonging to another account holder), (iv) check deposits, (v) instant funding to your SoFi Bank Debit Card, (vi) push payments to your SoFi Bank Debit Card, and (vii) cash deposits. Qualifying Deposits do not include: (i) transfers between an account holder’s Checking account, Savings account, and/or Vaults; (ii) interest payments; (iii) bonuses issued by SoFi Bank or its affiliates; or (iv) credits, reversals, and refunds from SoFi Bank, N.A. (“SoFi Bank”) or from a merchant. SoFi members with Qualifying Deposits are not eligible for other SoFi Plus benefits.

SoFi Bank shall, in its sole discretion, assess each account holder’s Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving a Direct Deposit or $5,000 in Qualifying Deposits to your account, you will begin earning 4.00% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.

SoFi Bank reserves the right to grant a grace period to account holders following a change in Direct Deposit activity or Qualifying Deposits activity before adjusting rates. If SoFi Bank grants you a grace period, the dates for such grace period will be reflected on the APY Details page of your account. If SoFi Bank determines that you did not have Direct Deposit activity or $5,000 in Qualifying Deposits during the current 30-day Evaluation Period and, if applicable, the grace period, then you will begin earning the rates earned by account holders without either Direct Deposit or Qualifying Deposits until you have Direct Deposit activity or $5,000 in Qualifying Deposits in a subsequent 30-Day Evaluation Period. For the avoidance of doubt, an account holder with both Direct Deposit activity and Qualifying Deposits will earn the rates earned by account holders with Direct Deposit.

Members without either Direct Deposit activity or Qualifying Deposits, as determined by SoFi Bank, during a 30-Day Evaluation Period and, if applicable, the grace period, will earn 1.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances.

Interest rates are variable and subject to change at any time. These rates are current as of 12/3/24. There is no minimum balance requirement. Additional information can be found at https://www.sofi.com/legal/banking-rate-sheet.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

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