Are You Spending Too Much? 12 Common Budget Drainers

If you feel like your spending money has decreased over the past few years, you’re probably right. Inflation has been tightening American budgets over the past three years. When electric bills and trips to the grocery store grow increasingly costly, it grows harder and harder to justify spending on non-essential luxuries. At 24/7 Wall St., we took a look at the areas where Americans tend to spend the most on indulgences. Are you draining your budget on one of the 12 common non-essential items? Read on to find out.

Everyone is feeling the drain. Internet searches for “how to save money,” has increased by over 20% over the past year. In a recent survey, 29% of Americans felt that they spent too much money on non-essential comforts. 65% of Americans felt they spent exactly what they should have on indulgences, and 6% felt they didn’t spend enough on indulgences.

Why Are We Talking About This?

As inflation (driven primarily by corporate greed) continues to rise, wages remain stagnant, and some elected officials propose raising taxes on everyday goods, people are being forced to think more critically about where and how they spend what little money they have left. We found some of the largest areas that consumers say they overspend the most, so hopefully, this will help you make better financial decisions in the future.

Here are 12 categories and top-selling brands of non-essential items that Americans are currently overspending on:

#1 Accessories

Over 40% of American consumers say they overspend on accessories. Surprisingly, this was especially true for men. Sunglasses and watches were among the favorite products to spend on by men who didn’t feel buyer’s remorse over their purchases.

Ray-Ban is the best-selling sunglasses brand in not just the United States, but the entire world. It holds 50% of the market share. With over 80 years in business, it’s no surprise that it has had decades to fine-tune and popularize its products. Its most iconic style is the Aviator sunglasses, which were originally created by the brand in the 1930s for military usage before hitting public markets.

#2 Clothing and Shoes

The U.S. apparel market is the largest of any other country and generated approximately 350 billion dollars in 2023. 21% of Gen Z consumers said they often bought clothes and shoes to indulge themselves, while 39% of all other generations said it was their favorite way to treat themselves. With the recent shift away from fast fashion to slow fashion and circular economy clothing becoming popular with Gen Z especially, this comes as no surprise.

The Brand that had the highest net sales in 2023 was Levi Strauss & Co. (NYSE:LEVI) raking in 6.18 billion dollars. 2023 was its highest-ever earning year with a marginal increase from 2022. Most sales predominately came from the United States.

#3 Alcohol

Alcohol is another non-essential indulgence that Americans overspend on. Of those surveyed, 40% said that spending on alcohol was most likely to cause buyer remorse. In fact, Gen Z and millennials said that happy hour was the no.1 regret in their spending habits.

The top-selling brand of spirits in the first quarter of 2023 was High-Noon. Hard seltzers are a recent trend in the drinking world. High-Noon successfully overtook the previous top brand, Tito’s Handmade Vodka in 2022. Since High-Noon was only established in 2019, that is a really impressive feat. Britt West, senior vice-president and general manager of E&J Gallo’s spirits arm attributes its success to the product’s ability to “tap into so many usage occasions, where traditional spirits haven’t been able to go to in the past.” High-Noon sold approximately 16.4 million cases last year, raking in 21.4 million dollars.

High-Noon also attributes its success to its mixed variety of 12-pack cans, and being ready to drink without an accompanying ice or mixer. With American consumers cutting back on travel and high-end events, the convenience and variety of High-Noon seltzer make it ideal for less expensive on-the-go events like beach days, boating, barbecues, and outdoor parties.

#4 Jewelry

According to the study, 31% of Americans said that they spend the most on jewelry, with 22% feeling regret about their jewelry purchases. Another 19% said that it was their favorite to spend on, and they didn’t regret this indulgence. Jewelry and watch sales increased significantly in 2021 and 2022, but have been decreasing again in 2023 and 2024.

Signet Jewelers Ltd. (NYSE:SIG) saw the highest revenue in 2023 at $6.70 billion in sales with Walmart (NYSE:WMT) at number two with $3.58 billion. Signet Jewelers has 2,411 locations across North America. The fine jewelry and watches company carries key brands such as 1933 by Esquire, Calvin Klein, Fossil, Chosen, Disney, Le Vian, Neil Lane, and Bold Reflections Lab-Created Diamond.

#5 Books

Around 30% of American Consumers chose books as their non-essential indulgences. And generally, not very many of them regretted their purchases. Since the written word has been around since approximately 618 CE, books might be considered one of the original forms of escape-ism. It’s no wonder that many readers turn to books in hard financial times.

Since the COVID-19 pandemic started, there has been a rise in book trends such as romance subgenres, “cozy books,” escapism, and AI books. The top-selling book in 2023 was Fourth Wing by Rebecca Varros. Fourth Wing is a fantasy romance/action novel. Baby Boomers buy books at twice the rate of younger generations. So, as this generation ages, we could possibly see a decline in book sales in the future.

#6 Electronics

Electronics can be a very controversial topic these days considering the unethical supply chain of some main components such as cobalt and copper. Despite this, 28% of American consumers say that their favorite thing to indulge in is electronics.

The highest-selling electronic brand in 2023 was, not surprisingly, Apple (NASDAQ:AAPL). Some of the highest-selling products last year included the iPhone, iPad, Mac, Apple Watch, AirPods, Apple TV, and HomePod. Apple generated $383 billion, with half of that coming from iPhone sales.

#7 Food Delivery

Food Delivery: something that most restaurants once offered in-house is now a third-party app monster that our economy seems to just keep feeding. Despite evidence that suggests major price gouging for restaurants, delivery drivers, and customers, many people feel that the high prices are worth the convenience and time-saving. American consumers spend an average of $118/month on food delivery.

So far in 2024, DoorDash (NYSE:DASH) is the most successful food delivery company in the nation holding 63% of the market share. The problem that DoorDash workers are facing is the company’s history of abusing tips, which delivery drivers depend on to make a living wage. Because drivers are considered “independent contractors,” they aren’t offered any benefits- even a legal minimum wage. Drivers are making use of apps such as Para, to be able to see what the tip the customer inputted upon placing their order. Without secondary apps, DoorDash can hide that information from drivers making accepting jobs a gamble on whether or not an order pays more than the gas money costs to deliver the order. Until recently, drivers were using Para to be informed about the money they were making when agreeing to take on a delivery job. That is, until DoorDash changed its data model, citing “privacy and data security,” reasons, so drivers can no longer use Para. DoorDash is so good at keeping its drivers in poverty that the United Nations cited the low pay as a human rights violation in 2023.  

DoorDash also routinely generates listings for restaurants that have never agreed to partner with them or have any user contracts in place, having delivery drivers order and pay for the food on company credit cards. This can bring about higher price gouging for customers, less-than-ideal food packaging, and liability issues.

#8 Junk Food and Snacks

According to a recent peer-reviewed study conducted in 2015, 97% of Americans reported eating candy at least once per year, and Americans eat an average of 8 pounds of candy per year. Americans tend to lean towards candy and sweet snacks when the munchies strike. The most popular junk food and snack of 2023 was M&M’s with a positive opinion score of 83%.

M&M’s is owned by Mars Incorporated. Mars Inc. is the world’s largest confectionery company and generated $50 billion in sales in 2023, $18 billion of which came from its snacking division with products including M&Ms, Snickers, Extra chewing gum, and Kind nutrition bars. Mars says it plans to double its snacking revenue over the next decade by pushing “healthier snacks,” as the sale of popular diet and weight-loss drugs like Ozempic may change Americans’ snacking habits over the next few years.

#9 Travel

Travel is something that 24% of American consumers like to indulge in. Unsurprisingly, 31% of those surveyed said that travel is their favorite category to spend on, and buyer regret is very low. Travel is also the most expensive non-essential category with American consumers spending $155/month on average. After all, what better way to engage in escapism than to physically escape, even if it’s only for a weekend?

#10 Amusement Parks

Amusement Parks are a popular travel destination for Americans with 24% of American consumers saying it’s their favorite thing to spend money on spending $97/month on average.

It shouldn’t come as a shock that Walt Disney World-Magic Kingdom was the most visited amusement park in 2023 (and all time). According to its website, approximately 35,000 people visit the park each day, with 9.6 million visitors per month depending on the time of year. In 2023, Disney Parks brought in a record $32.5 billion in revenue.

#11 Makeup

Makeup can be an artistic outlet for many people. It is also a multi-billion-dollar industry that some might say feeds off of the insecurities of consumers. Either way, this FDA-unregulated industry includes celebrity brands (which brought in $1 billion of revenue last year), multi-level marketing brands, drug-store brands, and luxury brands. The make-up brand that had the highest revenue in the United States in 2023 was L’Oréal. L’Oréal is a global make-up juggernaut based in France that registered its third year in a row of double-digit growth. It reached record-breaking global sales in 2023 at $245.17 billion and accounted for 18.2% of total sales.

#12 Skin Care Products

Skin Care is something that is gripping the younger generations in a chokehold. Based on internet searches, the most popular skincare brand is CeraVe with 1.5 million average monthly searches in the US.  CeraVe is owned by the parent company L’Oréal, along with Ambi and AcneFree. L’Oréal acquired CeraVe in 2017. CeraVe specializes in products such as cleansers, moisturizers, and sunscreens. The American consumer spends $85/month on average on skin care products with 21% of surveyed consumers saying it’s their favorite indulgence.

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