Doxo, a revolutionary web, and mobile bill pay service provider, has published its latest doxoINSIGHTS report called the, “2020 US Bill Pay Market Size & Category Breakout.” The latest findings indicated that the average American spends $2.75 trillion a year in 11 distinct bill payment categories. This comprises well over one-fifth of 21% of total U.S. consumer spending.
How The Information Was Gathered
Actual household payments data was used to perform statistical analysis and to determine the size of the market as well as categories. More than 30,000 US zip codes and 45 different types of services were also examined.
According to doxo, its “ unique, nation-wide household bill pay data specifically quantifies the actual consumer portion of total recurring bill spend and household penetration rate for each category.”
In addition, all the bill pay data had the following properties:
- With well over 4 million paying consumers, this provided a “statistically significant” database.
- By including more than 30,000 US zip codes, it ensures that the data was “geographically diverse”.
- Participation came from all income brackets, providing economic representation.
- Acquiring sources of payment funding, including credit cards, bank accounts, and debit cards.
Further research found that the average U.S. home was spending a total of $21,378 annually on bills. With the US Census Bureau reporting a median household income of $65,712, this reveals that almost one-third of Americans’ annual earnings goes to cover these essential expenses. This is a considerable percentage of income in every respect.
Top Monthly Expenses By Category
Coming at the top of the list of monthly expenses was the cost of housing by way of mortgages. The average mortgage amount spent per month was $1,268. Rent followed closely behind at $1,023. Auto loans came in third at $374 per month.
It was also discovered that the average American household was paying more “out-of-pocket” each month for their cell phone, internet, and cable. This was well over the amount of health insurance, dental, and even life insurance. However, these premiums are mostly covered by their current employers.
Although the $21,378 spent annually by the average American household covers only the “most common bills”, there are additional costs associated with bill pay. These additional costs include payment account fraud and identity theft as well as overdraft and late fees. All these fees tack on an additional $577 ever year, for every household. This translates into $74 billion annually.
Staying On Top Of Your Bills
The key to maintaining good financial health is to stay current and up-to-date on your bills. This will ensure that you are not needlessly paying late fees and other additional charges.
By utilizing bill pay, you are ensuring that none of your payments are neglected, giving you peace of mind, knowing that the funds are being automatically withdrawn from your bank account.