PERSONAL FINANCE

Using the Consumer Expenditure Survey to Estimate Prototype Expenditures

To complete Assignment 6, you may use the consumer expenditure survey (CEX) to obtain preliminary estimates of the expenditures for which you do not obtain cost information (e.g., most day-to-day expenditures). (Note: you will need to adjust these preliminary estimates using Table 706 of the Statistical Abstract.)

To use the consumer expenditure survey go to http://data.bls.gov/PDQ/outside.jsp?survey=cx. Under " Select an Item", scroll down until you come to "total average annual expenditures." Choose the expenditure items (e.g. Food) for which you want an estimate.

For example, I wanted to obtain estimates for the Houston prototypes total expenditures on food. To get an estimate, I clicked on "Food" (it became highlighted in blue). I next went to "Select a Table" and selected income before taxes and then under " Select one or more Columns", I selected "0216 $120,000 to $149,999....) since the Houston prototype has a family income of $137,500. Next at the bottom left of the page, I clicked on "Add to Your Selection".

I next clicked on "Get Data under at the bottom left of the page. The following screen appeared with the estimates I wanted.

(Note: be sure that the popup blocked on your web browser is set to allow popups from the bls.gov site. BLS presents the data in a popup.) Note that in 2006, typical families with pre-tax incomes like the Houston prototype's spent $10,159 on food.

After you obtain all the estimates you need from the CEX, you have to adjust the estimates for differences in costs of living (COL) using Table 706 of the Statistical Abstract. Click here to see how to do this.

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