It all started with a conversation. The idea was floated that we need a better measure for how people are doing rather than just looking at median income. Let's face it when you see median income 1970 $8,730 and you see 2025 $87,460 it's easy to assume that people in 2025 are just a lot richer. But is it true?
This is how we get to the Income to Expense Ratio.
I asked Co-Pilot a series of questions and then used those numbers to create a very simple formula.
I = Income, H = Housing, HC = Health Care, HE = Higher Education, U = Utilities, A = Automobiles, T = Travel, S = Savings, CC = High Interest Debt
(H/I) + (HC/I) + (HE/I) + (U/I) + (A/I) + (T/I) - (S/I) + (CC/I) = ItoE
Here are the list of questions with results.
1. As a standalone question, provide the U.S. median household income for the years 1970, 1980, 1990, 2000, 2010, 2020, and 2025. Use nominal (not inflation-adjusted) dollars. Present the results in a table and identify the primary data source.
| Year | Median U.S. Household Income (Nominal Dollars) |
|---|---|
| 1970 | $8,730 |
| 1980 | $21,020 |
| 1990 | $29,940 |
| 2000 | $41,990 |
| 2010 | $49,280 |
| 2020 | $67,520 |
| 2025 | $87,460 |
2. As a standalone question, provide the average annual housing cost per U.S. household for the years 1970, 1980, 1990, 2000, 2010, 2020, and 2025. Include mortgage principal and interest, property taxes, homeowners insurance, rent payments, and renter's insurance as applicable. Use a methodology that reflects both homeowners and renters in proportion to their prevalence during each year. Explain the methodology, identify the primary data source, and present the results in a table.
| Year | Average Annual Housing Cost per U.S. Household |
|---|---|
| 1970 | ~$2,100 |
| 1980 | ~$4,800 |
| 1990 | ~$8,000 |
| 2000 | ~$11,800 |
| 2010 | ~$15,800 |
| 2020 | ~$19,400 |
| 2025 | ~$24,500 |
3. As a standalone question, provide the average annual healthcare expenditure per U.S. household for the years 1970, 1980, 1990, 2000, 2010, 2020, and 2025. Include spending paid by households, employers, and government programs. Present the results in a table and identify the primary data source.
| Year | Average Healthcare Expenditure per Household |
|---|---|
| 1970 | ~$1,100 |
| 1980 | ~$2,900 |
| 1990 | ~$5,800 |
| 2000 | ~$9,800 |
| 2010 | ~$17,100 |
| 2020 | ~$28,400 |
| 2025 | ~$39,000 |
4. As a standalone question, provide the average annual cost of attending a public four-year in-state college in the United States for the years 1970, 1980, 1990, 2000, 2010, 2020, and 2025. Include tuition, mandatory fees, room, and board. Use the same methodology for all years and present the results in a table.
| Year | Average Annual Cost of Attendance |
|---|---|
| 1970 | ~$2,000 |
| 1980 | ~$4,000 |
| 1990 | ~$8,000 |
| 2000 | ~$12,000 |
| 2010 | ~$20,000 |
| 2020 | ~$26,000 |
| 2025 | ~$29,000 |
5. As a standalone question, provide the average annual household spending on utilities in the United States for the years 1970, 1980, 1990, 2000, 2010, 2020, and 2025. Include electricity, natural gas, water, sewer, trash collection, and telecommunications where historical data permits. Use the same methodology for all years and present the results in a table.
| Year | Average Annual Utility Spending per Household |
|---|---|
| 1970 | ~$600 |
| 1980 | ~$1,300 |
| 1990 | ~$2,100 |
| 2000 | ~$2,900 |
| 2010 | ~$4,100 |
| 2020 | ~$4,700 |
| 2025 | ~$5,500 |
6. As a standalone question, provide the average annual household spending on automobiles in the United States for the years 1970, 1980, 1990, 2000, 2010, 2020, and 2025. Include vehicle payments, fuel, insurance, maintenance, and registration costs. Use the same methodology for all years and present the results in a table.
| Year | Average Annual Automobile Spending per Household |
|---|---|
| 1970 | ~$1,500 |
| 1980 | ~$3,200 |
| 1990 | ~$5,000 |
| 2000 | ~$7,500 |
| 2010 | ~$8,500 |
| 2020 | ~$9,500 |
| 2025 | ~$13,000 |
7. As a standalone question, provide the average annual household spending on travel and vacations in the United States for the years 1970, 1980, 1990, 2000, 2010, 2020, and 2025. Include transportation, lodging, and related travel expenses. Use the same methodology for all years and present the results in a table.
| Year | Average Annual Travel & Vacation Spending per Household |
|---|---|
| 1970 | ~$500 |
| 1980 | ~$1,000 |
| 1990 | ~$1,800 |
| 2000 | ~$2,700 |
| 2010 | ~$3,100 |
| 2020 | ~$1,800 |
| 2025 | ~$4,500 |
8. As a standalone question, provide the average annual amount saved per U.S. household for the years 1970, 1980, 1990, 2000, 2010, 2020, and 2025. Define the savings measure used, use the same methodology for all years, and present the results in a table.
| Year | Average Annual Savings per Household |
|---|---|
| 1970 | ~$800 |
| 1980 | ~$2,000 |
| 1990 | ~$2,500 |
| 2000 | ~$2,000 |
| 2010 | ~$2,700 |
| 2020 | ~$8,000 |
| 2025 | ~$9,000 |
9. As a standalone question, provide the average high-interest consumer debt per U.S. household for the years 1970, 1980, 1990, 2000, 2010, 2020, and 2025. Define high-interest debt as revolving credit card debt unless a better consistently available measure exists. Use the same methodology for all years and present the results in a table.
| Year | Average High-Interest Consumer Debt per U.S. Household |
|---|---|
| 1970 | ~$500 |
| 1980 | ~$1,500 |
| 1990 | ~$3,000 |
| 2000 | ~$5,500 |
| 2010 | ~$7,000 |
| 2020 | ~$8,200 |
| 2025 | ~$10,900 |
