These Are Americans' 5 Largest Household Bills

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  • The average American spends thousands of dollars per month on household essentials.
  • Sometimes, it's possible to reduce these costs with careful planning.

Are these expenses costing you a fortune?

Everyone's budget looks a little different, but we all spend a lot of money on common household expenses, like housing and utilities. These things can eat up a lot of our monthly incomes, leaving us without much to save or spend on things we enjoy. 

Shrinking your household bills isn't always feasible, but there are a few things you can try that might help. Below, we'll look at some of the largest regular household bills, according to doxo, and the steps you can take to save a little money on them.

1. Mortgage payments

The average American homeowner with a mortgage spends about $1,368 per month just to keep a roof over their head. And there are some homeowners who spend considerably more. 

If you haven't purchased a home yet, you can control costs somewhat by shopping for homes that fit comfortably into your budget. You can also compare rates from several mortgage lenders to see which is willing to offer you the best price.

If you already have a mortgage, consider refinancing when rates are low. Doing this could lower your monthly payments, though there's a possibility you pay more in interest overall. Plus, you'll have to pay closing costs again. Still, if lowering your monthly bills is your primary objective, this could help.

2. Rent payments

Rent payments fall closely behind mortgage payments, with the average being $1,129 per month. Again, actual costs vary significantly based on the size of the home or apartment and its location and finishings.

Renters don't have as many options for lowering their payments, other than to explore more affordable places to live once their lease is up. If there's room, you could also consider finding a roommate to split the costs with. But not everyone wants to share their living space.

3. Auto loans

The average auto insurance payment in the U.S. is $433 per month, according to doxo. But not all households have a car loan. Those who hang onto their older vehicles and those who live in walkable cities or cities with great public transit can get by without an auto loan.

Again, shopping around when looking for a car loan is key to finding a great rate. Anything drivers can do to boost their credit can also help, since many lenders offer better rates to borrowers with high credit scores.

If you are able to keep your car in good repair over time, consider holding onto it rather than trading it in every few years. Then, once you're done paying off your current auto loan, you can set aside the money you're saving each month to help you buy a new car outright when you need one.

4. Utilities

Utility costs vary by location and how much you use, but the average American household pays $328 per month. This includes things like electricity, natural gas, and water usage.

You can reduce these costs simply by using less, if you're able to. Consider dropping the temperature on your thermostat a few degrees in the winter and raising it a few degrees in the summer. You should also make an effort to turn off lights and TVs when you're not in the room and even unplug appliances when they're not in use.

In addition, you could try setting up a payment plan with your utility provider so you pay the same amount each month rather than experiencing sky-high bills in the winter. 

5. Auto insurance

Auto insurance premiums cost the average American household about $196 per month. But rates vary significantly based on the driver's history, where they live, their vehicle make and model, and which discounts they qualify for.

Comparing quotes from several providers is the best way to find a great rate. Drivers should also reach out to their current insurance provider to inquire about discounts if they believe they qualify for some. For example, most people see their rates drop at age 25 and when they get married, so checking for new insurance when reaching these milestones is wise.

Drivers might also consider enrolling in a usage-based car insurance program. This monitors driving habits and bases the driver's rate on how safe they are. Many companies that offer these programs also give an upfront discount to participants just for trying it.

If there are any suggestions above you haven't considered before, now might be a good time to give them a try. Even if you only save a few dollars each month, this will add up over time.

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