New doxoINSIGHTS report leverages doxo’s proprietary nationwide dataset of actual bill payments, finds the average U.S. household spends $21,378 per year on 11 most common bills
SEATTLE, WA – December 17, 2020 – doxo, the innovative web and mobile bill pay service, today released its latest doxoINSIGHTS report, 2020 US Bill Pay Market Size & Category Breakout, revealing that Americans spend $2.75 trillion annually – over one fifth (21%) of all U.S. consumer spending – across 11 primary bill payment categories. For the first time, statistical analysis of actual household payments was used to size the market and category – across 30,000+ US zip codes and 45 types of services. The report, which found that the average U.S. household spends $21,378 per year on bills, breaks out the household spending market size for each bill category, percentage of households that pay each bill, and average monthly and annual bill pay costs by state.
“The U.S. Bill Pay economy is massive and complex. By leveraging our proprietary database of consumer household payments to create doxoINSIGHTS reports, we strive to make it much more transparent and understandable for consumers, billers, and financial service providers alike,” said doxo co-founder and CEO, Steve Shivers. “doxoINSIGHTS reports, alongside doxo’s simple, secure, all-in-one bill pay service, comprise vital parts of our mission to empower consumers to make better decisions and gain greater control of their financial outcomes.”
doxo’s proprietary dataset of consumer bill pay activity generates the industry’s most accurate category and regional statistics
doxo’s bill pay service enables all-in-one bill pay to more than 75,000 providers across the country in 45 different service categories. By incorporating tens of millions of bill payments across 30,000+ U.S. zip codes and all U.S. income and regional demographic segments, the 2020 US Bill Pay Market Size & Category Breakout is a true and direct representation of what Americans actually pay on their bills. This proprietary dataset provides the foundation for doxoINSIGHTS’ bottoms-up market sizing of the 11 most common bills, and makes category size and average spend transparent at the national, state, and local level. In contrast to other industry data sources – which often mix household recurring bill expenses with employer-paid expenditures (e.g. health insurance), and retail and discretionary spending (e.g. credit card balances) – doxo’s 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
The U.S. Bill Pay Market Size & Category Breakout Report findings include breakouts by service category, household market penetration for each type of service, and household average spend per month by state.
$2.75 trillion total household bill pay spent across these categories:
- $782B Mortgage
- $537B Rent
- $421B Auto Loan
- $345B Utilities
- $229B Auto Insurance
- $140B Cable & Internet
- $127B Mobile Phone
- $112B Health Insurance (consumer-direct portion)
- $33B Life Insurance
- $18B Alarm & Security
- $5B Dental Insurance (consumer-direct portion)
The average U.S. household spends $21,378 per year on the most common bills
According to The U.S. Census Bureau, the median household income in the U.S. is $65,712. This number, combined with doxo’s estimate that the average U.S. household spends $21,378 per year on common bills, suggests that nearly one third of Americans’ yearly salary is put towards core expenses – a sizable portion of income by any measure.
While housing costs top monthly expenses, the report reveals that the average household is paying more out-of-pocket per month for mobile phone and cable/internet bills than health, life, or dental insurance, which are frequently covered by their employer or automatically deducted from paychecks. The average monthly amount of each bill paid in each category is:
- $1,268 Mortgage
- $1,023 Rent
- $374 Auto Loan
- $290 Utilities
- $181 Auto Insurance
- $110 Cable & Internet
- $94 Health Insurance
- $88 Mobile Phone
- $76 Life Insurance
- $76 Alarm & Security
- $25 Dental Insurance
Note that the market size of each category, and the total spend per household per year, factor in not just the average amount of each bill payment, but also the actual percentage of households paying each category. For example, consumers that pay rent are not typically also paying a mortgage. See the report for these category details.
Comparison data shows how bills rank by state
- Mortgage payments are highest in New Jersey, California, Hawaii, New York, and Massachusetts, respectively. Many of the same states also top the list for rent costs: Hawaii, California, Maryland, New Jersey, and New York. West Virginia has the distinction of being the most affordable state for both mortgage and rent costs.
- Auto Loan payments are highest in Alaska and Wyoming at $464 and $443/month, respectively. Pennsylvania and Maryland residents enjoy some of the lowest at $301 per month.
- Utilities expenses are highest in Hawaii ($396 per month) and Maine ($383 per month), while Texas ($240) and South Dakota ($195) are more affordable.
- Cable & Internet bills make the biggest dent in the pockets of residents in the northeast, specifically New Hampshire, Massachusetts, Maine, Connecticut, and New Jersey.
- Mobile Phone bills are cheapest in Montana ($70/month), but almost double in West Virginia ($121 per month).
- Health Insurance expenses, when considering consumer out-of-pocket spending only (excluding employer payments, are lowest in New York ($61/month) and highest in Minnesota ($171 per month).
- Life insurance spend is highest in Alaska ($105/month) and lowest in Oregon ($61 per month).
- Alarm & Security is least expensive for Oklahoma residents while New Yorkers and Mainers pay more for protection.
In addition to the $21,378 per year the average household spends on the most common bills, consumers also contend with additional hidden costs of bill pay. Identity theft and payment account fraud, late and overdraft fees, as well as detrimental credit impacts ultimately add up to an additional $577 each year per household, or $74 billion annually. The Hidden Costs of Bill Pay report from doxoINSIGHTS exposed these fees, as staying on top of bills is the single largest determinant for consumer financial health.
For more information, or to view the entire report, visit www.doxo.com/insights/.
doxoINSIGHTS provides direct insight into household financial health and spending activity by leveraging consumer surveys and doxo’s unique aggregate bill pay data set, comprising actual bill payment activity to confirmed household service providers across the country. doxo data brings together the broadest available data set for analyzing actual household bill payment activity, pulling from over 4 million paying consumers across over 90% of U.S. zip codes. doxo’s payment network covers over 75,000 billers in 45 different service categories and enables payments using bank accounts, credit cards or debit cards. This uniquely broad statistical foundation powers doxoINSIGHTS reports – uncovering key trends for household financial health and bill payment behavior.
doxo provides simple, secure all-in-one bill payment to any biller, with any payment method, on any device. A doxoPLUS subscription adds free bank payments and five essential financial protections that boost household financial health. Through these services, doxo currently serves over four million paying users who can make payments to over 75,000 local and national businesses, making doxo the largest bill pay directory in the nation. Billers on the network get paid directly, fast and free – and consumers have complete bill pay independence over when and how they pay their bills. doxo expanded its user base by more than 70 percent in the past year and is expanding its team to further accelerate growth and change the bill pay landscape to focus on the customer. doxo investors include MDV, Sigma Partners, and Bezos Expeditions. doxo is based in Seattle, WA. For more information visit www.doxo.com.