What the numbers say
The latest Consumer Expenditure Survey shows essentials squeezing wallets harder. Together, housing and food nearly hit the halfway mark of 2025 outlays, the most since 2010, as rents, homeowner costs and beef prices climbed.
Housing remained the top expense at 33.9% of spending. Setting aside a pandemic-era pop in 2020, that slice was the largest since 2010. The category covers rent, utilities and household furniture, capturing both the roof and what powers it.
Food's footprint rose to 13% in 2025, the highest since 2011. On average, families spent $1,988 more on housing plus food than in 2024.
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Where the increases came from
Income growth helped, with average pretax income up 6.4% to $110,847 in 2025, outpacing inflation and total expenditures. Even so, the BLS reports only two major categories posted statistically significant gains last year: housing and food.
The food budget climbed 4.6% to $10,633. Within groceries, outlays for meat, poultry, fish and eggs came to $1,579 - an 11.7% rise from 2024 and double the level in 2010. In 2025, those proteins represented about 24% of grocery outlays, up from 19% in 2023, and were responsible for roughly 95% of the gain in average food-at-home expenses across the two-year span.
After the 2025 survey closed, the Iran war pushed some grocery and utility prices higher this year, adding pressure beyond the reported period.
Why it matters for investors
Bigger shares for housing and food explain why affordability dominates the upcoming midterm elections and why sentiment can lag better paychecks. When more cash goes to necessities, there is less left for discretionary purchases, a tilt that can show up in staples versus splurge categories in spending data.
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