One big reason Americans are broke and overweight

1 in 3 Americans admit that dining out too much is a financial mistake they made this year, new data show.

Dining out is weighing on our budgets.

The No. 1 thing Americans bust their budget on is dining out, according to research released by financial company Principal. Nearly one in three Americans (29%, up from 26% last year) said that this was this year’s top budget buster for them, followed closely by food/groceries (27%). And research released Monday by financial company Fidelity found that the No. 1 small financial mistake Americans admit to is dining out too much, with 36% saying they’d done that in the past year.

Government data shows that Americans spent nearly $3,500 a year on dining out in 2018 — a 2.8% increase just from the year prior. And restaurant sales are projected to hit a record high this year of $863 billion, according to the National Restaurant Association. What’s more, as MarketWatch reported in July of this year, “the cost of going out to eat or getting takeout food is rising a lot faster than the cost of buying groceries.”

What’s more, we eat out often: Gallup data shows that six in 10 Americans ate dinner out at least once in the past week, and 16% ate dinner out three or more times. “Dining rooms and kitchens across the U.S. are getting a little less use than they used to,” research firm Nielsen noted. “That’s because Americans have embraced the experience of eating out.”

One reason dining out is such a budget buster: People who eat out a lot tend to underestimate what this will cost them, according to a 2017 study from researchers at Penn State. The researchers asked the participants what they thought they would spend eating out at the beginning of a two-week period and then in the middle of that period; participants upped their average budget from a little under $18 in week one to about $55 in week two.

“What this tells us is that obviously they thought they would spend less in a week, but as the week progressed they realized they were spending a lot more and they rationalized that increase,” says Amit Sharma, associate professor of hospitality management and director of the Food Decisions Research Laboratory, Penn State….[ ]

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