As a follow up to the budgeting post from Tuesday, a reader recently sent me an interesting dashboard her company had created. They used data from the Bureau of Labor Statistics to create a visual app of how Americans are spending their money, and how education influences those buying decisions.

retale

The dashboard was created by Retale, an app that shows you coupons at retailers in your area. The app may be worth checking out if you are looking to shave some dollars off your spending.

I found the results of the dashboard to be enlightening. Housing and transportation costs alone comprise about 50% of average household spending. Add in healthcare and food and you’re looking at about 70% of household spending being chewed up by relatively fixed costs.

What was even more interesting was that in almost all categories, a higher percentage of household income was taken up for those with less education. For example, spending on housing takes up 39% of income for those with no high school diploma, vs. 33% average nationally. This issue is compounded by the fact that most in the lower education bracket likely are renting and not buying, so they don’t get the tax benefits and equity home owners do.

Unsurprisingly, groups with less education spent less of their household income on entertainment, reading & education, and “other.” With so much of their household income spent on fixed costs, there is little left over for discretionary spending.

This analysis felt particularly poignant today given that Wal-Mart (WMT) just announced second quarter earnings. Results were not great and Wal-Mart cut its earning guidance amid flat sales and a seventh straight quarterly decline in U.S. store traffic.

By the way, I have no idea why the stock isn’t trading down; sometimes the market makes 0 sense to me too.

Wal-Mart’s struggles make sense in light of Retale’s dashboard. Wal-Mart’s core shoppers – those with lower income and less education – are focused on supporting core household expenses, like rent. As a result there’s less to spend on non-necessities at stores like Wal-Mart.

I’m pessimistic about Wal-Mart’s future. Due to the economic discrepancies the dashboard illustrates, I stick by the comment I’ve been making on the blog that retail growth will lie with higher end retailers.

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