What Do You Spend More On Than Your Retirement?

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A while back “avocados” was trending on Twitter. Thanks to Australian real-estate mogul Tim Gurner, avocado on toast started trending worldwide after his harsh words about Millennials.

According to Time, Mr. Gurner was quoted lamenting Millennials’ wasteful and indulgent habits, stating “when I was trying to buy my first home, I wasn’t buying smashed avocado for $19 and four coffees at $4 each.” He continued, “we’re at a point now where the expectations of younger people are very, very high. They want to eat out every day; they want travel to Europe every year.”

While avocados have increased in price, it’s doubtful smashed avocados and European vacations are what keeps Millennials from saving for retirement. Furthermore, it’s doubtful avocados and European vacations are keeping other generations from saving for retirement as well. So what do people spend more on than they do on retirement?

Here are the top three things people around the country are spending their money on, many in place of saving for retirement.

Retirement Savings

In general, people aren’t doing a great job saving for retirement. While there are a lot of reasons why people aren’t saving for retirement and are spending their money elsewhere, the bottom line is that, for many people, retirement is a long way off.

According to the Wall Street Journal, people really don’t think about saving for retirement until they “see” themselves older. While it’s possible for many people to think a few years into the future, hence why we make financial goals, longer-term planning is much more difficult. The combination of time plus impact creates, in our minds, a nebulous future that makes attaching importance to saving for it difficult. Even though we logically know the future is coming, it’s still hard to sacrifice now.

Retirement savings ranges among age groups, which makes sense since younger people have had less time to save than their parents. According to CNBC, the median retirement savings for the top age range for Millennials and younger Gen Xers is $480. That number jumps for people age 38-43, as they have a median of $4,200 saved for retirement. Those aged 56-61 have the most saved, but still have only $17,000 saved for retirement.

Related: How Much Should I Have Saved in My 401(k) at 30?

Clearly, it’s not just Millennials who struggle to save for retirement. So what is so enticing (or so necessary) to keep people from saving more for retirement? It turns out there are a few main areas where people spend more on than they do for retirement.

Housing

Almost every generation has been impacted by the housing market over the last 20 years, including Millennials and Gen Xers. While Gen Xers may have seen their housing values plummet after the 2008 crisis, Millennials found themselves being priced out of many markets as the housing economy rebounded.

According to Mother Jones, Millennials spend about $2,000 a year more on overall housing as compared to young families in the 1980s and 90s. This includes rent, maintenance, utilities, etc. In addition, rents have gone up in many cities, and are now roughly $1,200 per month for a one bedroom apartment.

Housing prices continue to rise in many big cities, pricing out Millennials and even Gen Xers who may have moved there for job opportunities or school, which mean more people are renting for longer than they probably anticipated. While there are several ways for renters to save money on expenses, renters are still largely at the pricing whims of the market.

On the other hand, overall disposable income has gone up, so while the increase in overall housing cost does take a large chunk of this disposable income, it’s not the only factor keeping people from saving more money for retirement.

Daycare

In many parts of the country, daycare costs are approaching the cost of in-state tuition – and this is for one child. If you have two or more children not yet school-aged, you can end up paying thousands of dollars for child care or a nanny. Yes, while there is a tax-credit for childcare expenses, nowadays many parents are finding out that this tax credit is quickly exhausted within the first few months of the year.

Related: 48 Ways to Save Money on Twin Babies (or any kids!)

According to CNBC, some of the cheapest parts of the country for daycare are in the South, but if you live on the coasts or in expensive cities around the US, you’re looking at spending $15,000 a year or more for child care – and most children aren’t eligible for subsidized kindergarten (if your state offers it) until the age of 5. Depending on when you return to work and choose to put your child in day care, you could be spending $15,000 a year for five years.

Thinking of taking time off to raise your child (and potentially save money)? Take into account future lost earnings. According to the Center for American Progress, a 26-year-old woman who earns $30,253 a year and takes off five years to raise a child is losing $467,000 over the course of her career – a 19% reduction in lifetime earnings.

With numbers like these, it’s no surprise that Millennials and Gen Xers who want children are starting to save now for future children. Child care expenses, to say nothing of health care costs to prepare for and deliver the baby, are mounting quickly. This makes it tougher to choose between saving for retirement in the nebulous future and saving money for a child arriving in a few years (or 9 months!).

Coffee and Convenience

While there are a lot of major expenses, it would be unfair to say everyone spends more on living and child care expenses than retirement without acknowledging many people spend on fun. In fact, coffee and convenience foods are the number one thing Millennials spend more on (and more often) than any other generation.

Perhaps it can be attributed to their busy and hectic lifestyle, but Millennials spend more than the average consumer on coffee and to-go meals, according to Business Insider. On average, Millennials go out for coffee or to-go meals 11 times a month and spend $80 on these purchases.

80 dollars per month is not chump change – remember how the average Millennials and Gen Xers has roughly $480 saved for retirement? $80 multiplied by 12 is $960 – double what Millennials and Gen Xers are currently saving for retirement. Avocado toast might be on the menu, but it’s interesting to note that travel expenses weren’t listed as being one of the biggest factors keeping Millennials and Gen Xers from saving for retirement.

It’s an interesting debate: should you spend your money on things that make you happy, especially when you think “$80 a month, compared to my $1,000+ apartment, is a small amount and it makes me happy”, or should you save for the future? When you consider that $80 a month is $960 a year, yet the average Millennial and Gen Xer only has $480 saved for retirement, it does make it harder to justify spending $80 every month on coffee and going out.

Eating out on a budget is not impossible. It can be healthier for you, and your wallet. And while it can be difficult to reduce expenses on your housing or child care costs, there are ways to spend more on retirement than on other items without sacrificing happiness.

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