Retirement Retired Life

Here's What the Average Retiree Spends Each Month on 4 Main Expenses

Federal data shows where households 65 and older spend the most.

By Chris Lewis, CEPF , Edited by Laura Hohenstein

Updated Nov. 13, 2026

Add Us On Google

Retirement planning often starts with a simple question: How much will I actually spend each month? Federal survey data offers a useful benchmark.

In 2025, households headed by someone 65 or older spent an average of $64,445, according to the Bureau of Labor Statistics Consumer Expenditure Survey. That comes to about $5,370 a month.

Four categories make up most of that total: housing, transportation, food, and health care. Together they account for about 77% of spending among older households, or roughly $4,146 a month.

Now Available: The Definitive Guide to Retirement Income

Many successful investors eventually reach the same moment. The saving is done, the portfolio is built, and the question quietly changes from how much can I grow this to how much can I take out? Get that second question wrong and decades of good investing can come apart in a handful of years.

That is exactly what The Definitive Guide to Retirement Income helps answer.¹ <p class="">Investing in securities involves a risk of loss. Past performance is never a guarantee of future returns. Investing in foreign stock markets involves additional risks, such as the risk of currency fluctuations. Guides are provided by Fisher Investments. The publisher may be compensated when readers request a guide.</p> It covers what your retirement could actually cost, which income sources are worth using, and the withdrawal math that decides whether the money lasts. It is free today from Fisher Investments. Read More Here ›

Housing: About $1,953 a month

Housing is the largest expense for older households by a wide margin. Households 65 and older spent $23,430 on housing in 2025, which is 36.4% of their total spending.

Paying off a mortgage doesn't make that number go away. About 54% of these households own their home with no mortgage, but they still pay property taxes, insurance, repairs, and utilities. In 2025, older households spent an average of:

$4,680 a year on utilities, fuels, and public services (about $390 a month)
$4,132 a year on maintenance, repairs, insurance, and other homeowner costs (about $344 a month)
$3,153 a year on property taxes (about $263 a month)

Mortgage interest made up a smaller piece, at $1,863 a year.

Shopping for cheaper auto insurance? Enter your zip code here to get started.

Transportation: About $842 a month

Transportation comes in second for the 65-and-older group overall. These households spent $10,109 on transportation in 2025, or 15.7% of their budget.

The biggest pieces were vehicle purchases at $3,670 a year, gas and other fuels at $1,748, and vehicle insurance at $1,734. Most older households still drive: 88% owned or leased at least one vehicle.

Food: About $686 a month

Older households spent $8,226 on food in 2025, or 12.8% of total spending.

Most of that went to groceries. Food at home cost $5,408 a year (about $451 a month), while restaurant meals and takeout cost $2,818 a year (about $235 a month).

Released: The Definitive Guide to Retirement Income (Sponsor)

Most people spend their entire working lives focusing on one thing: growing a pile of money. Then they retire and discover the skill they actually need is close to the opposite. Turning that pile into steady income, year after year, through good markets and bad, without ever running out. It may be the least discussed and most consequential transition in personal finance, and plenty of otherwise careful investors walk into it with no real plan.

That is exactly what The Definitive Guide to Retirement Income helps answer.¹ <p class="">Investing in securities involves a risk of loss. Past performance is never a guarantee of future returns. Investing in foreign stock markets involves additional risks, such as the risk of currency fluctuations. Guides are provided by Fisher Investments. The publisher may be compensated when readers request a guide.</p> It is a free guide from Fisher Investments covering what your retirement will really cost, where the cash flow should come from, and how much you can safely withdraw each year. Learn More Here ›

Health care: About $666 a month

Health care takes a much bigger share of older households' budgets than it does for the average household. In 2025, households 65 and older spent $7,986 on health care, or 12.4% of spending. Across all U.S. households, health care was 7.9% of spending.

Insurance is the main driver. Health insurance premiums cost older households $5,406 a year, about two-thirds of their total health care spending. Medical services added $1,429, and prescription drugs added $837.

Medicare doesn't cover everything. In 2026, the standard Medicare Part B premium is $202.90 a month and the annual deductible is $283, according to the Centers for Medicare and Medicaid Services. Medicare typically announces next year's amounts in November.

Spending drops after 75, but health care costs rise

The picture changes with age. Households headed by someone 65 to 74 spent $69,333 in 2025, about $5,778 a month. Households headed by someone 75 or older spent $57,959, about $4,830 a month.

Transportation accounts for most of that decline. It fell from $12,082 a year for the younger group to $7,523 for the older group.

Health care moved in the other direction. It rose from $7,793 to $8,238 a year and grew from 11.2% to 14.2% of spending. For households 75 and older, health care overtakes transportation as the second-largest expense after housing.

Housing also takes a bigger share later in life, rising from 34.7% of spending for the 65-to-74 group to 39.0% for the 75-and-older group, even though the dollar amount dips slightly.

Retirement News: Almost 80% of Americans fear a retirement age increase — here’s the real reason why

What can push your numbers higher or lower

These figures are national averages, so your own spending may look quite different. Some factors that can shift it:

Whether you rent or own. Renters and homeowners with a mortgage face different housing costs than people who own their home outright.
Where you live. Property taxes, insurance, and utility costs vary widely from place to place.
Your Medicare choices. Original Medicare with a supplement and a Medicare Advantage plan can involve very different premiums and out-of-pocket costs.
Your health. Someone managing ongoing medical needs may spend well above the average.

Bottom line

Average spending figures can't tell you exactly what your own retirement will cost, but they do show where the high costs tend to be. Housing takes more than a third of an older household's budget, and health care tends to take a bigger share the older you get.

Tracking your own spending for several months, or even a full year, may give you a more realistic number to build your income plan around. A financial advisor can potentially help turn those numbers into a withdrawal strategy.

More from FinanceBuzz: