You can read tons of bookkeeping statistics across the internet. It’s easy to quote a finance statistic to support almost anything you believe. In the past years as practicing bookkeepers, We’ve read A LOT of stats. Some come from reliable sources, and some less so. And many times, the source isn’t even quoted. Our goal is to develop a repository of credible stats that give a clear picture of the nation and our state.
1. Average Income is Up! But Not as Much as Taxes
Do you get furious during tax time and wonder how your grandparents or parents did it? Easy. Their taxes were way less than ours. The Consumer Expenditure Survey for 2018 reports some interesting numbers. From 1941 to 2018 the average income for the American household grew by 176%. Not bad. However, the federal tax rate alone for that same period of time grew by 378%. That is nearly double the rate. Over the years, tax rates have grown, not to mention different taxes, types of taxes, etc.
A few other key takeaways:
- The average American income before taxes was $78,635 in 2018.
- The average state and local tax rate grew by 413% between 1941 and 2018 from $234 annually to $2285.
- Other taxes (only) increased 42% in that period of time from $55 per year to $78.
2. What About Inflation?
Good call! The above numbers are the actual increase, not adjusted for inflation. When adjusted, from 1941 to 2018 the average income for the American household grew by 32%. In 1941, the average person earned $32,900 per year. In 2018, they earned the same $78,635. This does not save the IRS from taking more than the 32% you would think they would. The increase in taxes was 129% adjusted for inflation in that same period of time, or $5,950 paid out in 1941 and $11,394 paid in 2018.
Other important inflation adjusted numbers include:
- 1973 seemed to be a banner year, as the average American income before taxes was $63,439 with $9,378 paid in taxes – not to mention lower prices on everything.
- The average state and local tax rate grew by 146% between 1973 and 2018 from $1,300 annually to $2285.
- Other taxes actually decreased 32% in that period of time from $306 per year in 1973 to $78 in 2018.
3. Bookkeeping Statistics by Age
It isn’t just being American. How much you earn also depends on your age. For example, those in younger age brackets who are just entering the work force earn less than their most experienced counterparts. Those who were older and more likely to be retired also earned less.
Note: These numbers are after all taxes
4. Debt is Still Huge
Total consumer debt as of March 2019 was nearly $4 trillion dollars in the United States, according to the Federal Reserve’s Consumer Credit Report. This amounts to $12,169 per person. In terms of credit card debt, the average person carries $3,058 with the total national credit card debt at just over $1 trillion. Student loan debt was more than auto loan debt at $1.59 trillion versus $1.16 trillion.
5. 2019 Bookkeeping Statistics for Texas
That’s all well and good for the rest of the country. What about our great state of Texas? We actually earned in the top half of the others with an average income of $50,000 to $59,999 per year after taxes in 2017, according to the American Community Survey. In Texas, the mean average income for married families was $108,340 for 2017, according to the U.S. Census 2017 ACS 5-Year Survey. Those registered as “non-families” earned an average of $51,855 for the same year.
Bookkeeping Help in Houston
Feel free to contact us if your home or your business need help with bookkeeping tasks.
