Splurging once meant spending money on buzzy restaurants, expensive vacations, and designer clothing. These days, what’s considered splurge-worthy falls into a more humble category.
Groceries are shaping up to be a top spending priority for younger generations, a February report from McKinsey & Company found.
The firm asked over 4,000 people, from baby boomers to Gen Zers, about the categories they intend to splurge on this year. Groceries ranked highest for millennials and Gen Zers, outpacing restaurants, bars, travel, beauty and personal care, apparel, and fitness.
Millennials are also becoming parents, which means they spend more on themselves, their partners, and their children. It’s a notable shift from 2018 when older generations like baby boomers and Gen Xers still spent more on groceries than millennials.
Gen Z, meanwhile, said they often choose high-quality snacks and beverages, which makes for expensive grocery bills.
The typical American household would need to spend $445 more a month to purchase the same goods and services as a year ago, a report from Moody’s found.
$445 more a month is over $5k a year!
Of course you need to make even more than that after taxes to compensate.
h/t Guest