The Bureau of Economic Analysis reported on September 30, 2026 that disposable personal income, which is personal income less taxes, rose $68.6 billion in August, a gain of 0.3 percent. Personal consumption expenditures, the measure of what households spent, rose $190.8 billion over the same month, up 0.9 percent. For households living on fixed or slow-growing incomes, including retirees who draw Social Security, the gap between those two numbers and the price index that sits beside them is the part of the release that bears on real purchasing power.
Spending rose by nearly three times the dollar gain in after-tax income
The figures come from the Bureau’s Personal Income and Outlays release for August 2026. In it, BEA says total personal income “increased $66.6 billion (0.2 percent at a monthly rate),” that disposable personal income “increased $68.6 billion (0.3 percent),” and that personal consumption expenditures “increased $190.8 billion (0.9 percent).” Spending therefore rose by about 2.8 times the dollar amount of the gain in after-tax income.
The spending number is a nominal one. It counts every dollar households laid out, so it includes the effect of higher prices as well as any rise in the quantity of goods and services bought. BEA reports the two effects separately, and the price side is where the release is least favorable for households trying to stretch an income.
Real disposable income was unchanged once prices are removed
Real disposable personal income, which adjusts the after-tax figure for inflation, showed a change of 0.0 percent from July to August. The same release says the PCE price index rose 0.3 percent in the month and 3.4 percent from a year earlier, and that excluding food and energy it rose 0.2 percent in the month and 3.0 percent over the year. The $68.6 billion of added after-tax income was, in other words, matched by higher prices in August.
BEA’s data cover all households in the country. The sections of the release read for this article do not break income, spending or inflation out for retirees as a group, so the figures describe the overall economy rather than the circumstances of any one age group.
Social Security and Medicare benefits were among the sources of income growth
BEA states that the August income increase “primarily reflected increases in compensation and government social benefits,” and its release cites “Medicare and social security benefits” among the programs behind the rise in government benefits. Compensation was led by private wages and salaries, based on Bureau of Labor Statistics data. For households that rely on benefit payments, the release places those payments among the drivers of August income, although it does not isolate a dollar figure for them in the passages reviewed here.
The most recent adjustment to those payments is the 2.8 percent cost-of-living increase that took effect with December 2025 benefits, payable in January 2026. The Social Security Administration’s cost-of-living page says it is computed from the increase in the CPI-W, the consumer price index for urban wage earners and clerical workers, between third-quarter averages. That index is not the PCE price index BEA uses, so the 3.4 percent PCE figure and the 2.8 percent adjustment are measured differently and are not a like-for-like comparison. The 2027 adjustment will come from the third-quarter 2026 CPI-W average and had not been announced as of October 2, 2026, when SSA’s page still listed 2.8 percent as the latest.
A saving rate of 4.1 percent leaves little cushion
BEA reports that “personal saving was $990.2 billion, and the personal saving rate, saving as a percentage of disposable personal income, was 4.1 percent.” The saving rate measures what households kept after taxes and spending, and at 4.1 percent it indicates that most after-tax income went to outlays in August. The release summary reviewed for this article does not give a July saving rate, so no month-to-month change in the rate is stated here.
BEA published the data alongside the third estimate of second-quarter 2026 gross domestic product, and the next Personal Income and Outlays release is scheduled for October 29, 2026. Monthly figures of this kind are revised, so the August numbers can change in later releases.
Property-tax and utility relief for households watching monthly costs
Older homeowners and renters on fixed incomes face property taxes, heating and cooling bills and home repairs on top of everyday spending, and relief programs exist for each. Each program has its own application and its own renewal date, which makes a record of what was filed and when worth keeping.
The Senior Property Tax & Home-Cost Relief Kit covers the 5 kinds of property-tax relief, the circuit-breaker credit that includes renters, and an application log and renewal calendar.
Open the application log and renewal calendar in The Senior Property Tax & Home-Cost Relief Kit →
This article was drafted with AI assistance from the cited official sources and checked against them before publication.
David M. Keller is a finance writer based in Columbus, Ohio, covering personal finance and consumer-focused economic topics. He earned his degree in journalism from Ohio University and began his career reporting on local business and economic trends for a regional media outlet. Since then, he has contributed to a variety of online publications, focusing on clear, practical coverage of topics such as cost of living, debt, and everyday financial decision-making.
