Key Highlights

  • Personal income rose USD 54.5 billion, or 0.2%, in September, below forecasts and slower than the 0.3% increase in August.
  • Disposable personal income rose 0.2%, but adjusted for inflation it fell 0.3% after holding flat in August.
  • Personal outlays increased USD 113.0 billion, and the personal saving rate declined to 3.8% from 4.0% in August.
  • Compensation, led by private wages and salaries, and government social benefits, led by Medicare, drove the income increase.

A Modest Rise in Household Income

US personal income increased USD 54.5 billion, or 0.2%, in September, according to estimates from the Bureau of Economic Analysis (BEA). The gain was smaller than forecasts and slower than the 0.3% increase recorded in August. Total personal income reached USD 27,708 billion in the latest series.

The BEA said the rise primarily reflected higher compensation of employees and higher government social benefits. Within compensation, the increase was led by private wages and salaries, based on Bureau of Labor Statistics data from the Current Employment Statistics survey. Within social benefits, the increase was led by Medicare, based on data from the Centers for Medicare and Medicaid Services and the Budget of the US Government.

Taxes and Disposable Income

Disposable personal income (DPI), which is personal income less personal current taxes, increased USD 52.7 billion, or 0.2%, slowing from 0.3% in August. The USD 1.8 billion difference between the rise in income and the rise in disposable income corresponds to the change in personal current taxes.

Outlays Outrun Income

Personal outlays, the sum of personal consumption expenditures (PCE), personal interest payments and personal current transfer payments, increased USD 113.0 billion in September. That is more than double the USD 52.7 billion gain in disposable income. Spending on goods and services accounted for nearly all of the rise, with PCE up USD 113.1 billion, made up of USD 35.1 billion on goods and USD 78.1 billion on services.

In percentage terms, current dollar PCE rose 0.5% after a 0.9% increase in August. The slowdown in spending growth still left it ahead of the 0.2% rise in disposable income.

Real Incomes Slip

Prices changed the picture. The PCE price index rose 0.5% in September after a 0.3% increase in August, while the index excluding food and energy rose 0.3% in both months. With disposable income up 0.2% and prices up 0.5%, real disposable personal income fell 0.3%, compared with no change in August.

Real PCE was unchanged in September after a 0.5% rise in August. The BEA put the increase in real spending at USD 2.6 billion, less than 0.1%. From a year earlier, headline PCE inflation was 3.6% and core PCE inflation was 3.1%.

August and September Side by Side

The BEA's summary table shows how each measure moved between the two months. Current dollar personal income rose 0.3% in August and 0.2% in September. Current dollar disposable income followed the same path, 0.3% then 0.2%. Real disposable income went from no change to a 0.3% decline. Current dollar PCE slowed from 0.9% to 0.5%, and real PCE from 0.5% to no change. The PCE price index accelerated from 0.3% to 0.5%, while the index excluding food and energy held at 0.3%.

Within real spending, goods fell 0.3% in September after a 1.1% rise in August, while services rose 0.2% after 0.3%. Energy was the main source of price pressure: gasoline and other energy goods prices rose 9.2% in the month, lifting overall goods prices 0.8%.

Saving Rate Edges Lower

Personal saving was USD 911.1 billion in September, and the personal saving rate, defined as personal saving as a percentage of DPI, was 3.8%. Market data providers show the rate at 4.0% in August. The decline of about 0.2 percentage points came in a month when outlays grew faster than disposable income.

Labor and Growth Context

Other data released on the same morning give context for the income figures. Seasonally adjusted initial jobless claims were 194,000 in the week ending October 24, the lowest since mid July, and continuing claims were 1,701,000 for the week ending October 17. Third quarter GDP grew at a 3.4% annual rate, with personal consumption rising 3.8% and real final sales to private domestic purchasers rising 4.9%.

Taken together, the releases show employment income still rising, though by less than prices in September. The BEA measures income and outlays on a monthly basis, while the GDP report covers the quarter from July through September.

Revisions and Data Notes

The BEA updated estimates for July and August to reflect revised Bureau of Labor Statistics employment data. The revision to personal interest income was led by monetary interest, based on newly available data from the Bureau of the Fiscal Service. The agency noted that data in the release will be superseded with the next report, and the original figures remain available in its data archive. Detail on spending by product type, in current and real terms, is published in the related tables of its interactive data application.

Markers to Follow

The next release, personal income and outlays for October, is scheduled for November 25, 2026, at 8:30 a.m. EST. Readers tracking household finances may watch private wages and salaries within compensation, Medicare and other social benefits, real disposable income, and the saving rate relative to 3.8%.