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Wealthy Beginnings: How the Rich Raise Their Babies Differently
Wealthy Beginnings: How the Rich Raise Their Babies Differently
July 7, 2024 5 by Cindy Lamothe Edited by Ashleigh Ray
Raising babies takes a lot out of you — emotionally, physically and financially. Rich parents are often better equipped to handle the toll because of one simple thing: resources.
“Wealthy families do not automatically make better parents, but they do have access to more support and therefore more time than most,” said Christine Landis, a former CEO of a global fintech company, a parent of two children and the founder of Peacock Parent.
Having this additional time and support allows both parents to be less resentful, and more present with their kids (and each other). Keep reading to see just how the wealthy raise their babies differently
Wealthy Beginnings: How the Rich Raise Their Babies Differently
July 7, 2024 5 by Cindy Lamothe Edited by Ashleigh Ray
Raising babies takes a lot out of you — emotionally, physically and financially. Rich parents are often better equipped to handle the toll because of one simple thing: resources.
“Wealthy families do not automatically make better parents, but they do have access to more support and therefore more time than most,” said Christine Landis, a former CEO of a global fintech company, a parent of two children and the founder of Peacock Parent.
Having this additional time and support allows both parents to be less resentful, and more present with their kids (and each other). Keep reading to see just how the wealthy raise their babies differently
They Count on a Full Staff of Helpers
“Ask any parent, and they will tell you that time is the ultimate luxury in parenthood,” explained Landis. “And this is exactly what wealthy parents can buy more of — time — in the form of delegation and outsourcing in parenthood.”
For example, wealthy families typically have multiple nannies, family assistants and private chefs to help with the duties typically expected of parents.
According to Landis, “The nannies work early morning shifts on weekends to allow the parents to sleep in together — a true luxury in parenthood — help with school drop off and pick up schedules and help keep the kids away from screens with good old fashion entertainment — like reading the same book over and over again.”
Family assistants also help maintain the household supplies, make doctors’ appointments and complete school paperwork — all the things that have to get done, but not necessarily by the parent.
“The private chef comes 3 times per week and handles the entire meal planning for the family — not just the kids — and saves both parents time and energy from grocery shopping, unloading, prepping, cooking and cleaning up meals for everyone.”
They Hire a Night Nanny
One of the most distinctive practices among wealthy parents is hiring a night nanny. This practice allows parents to ensure that they get adequate rest while their newborn is cared for by a professional during the night.
Head of growth at GoSummer, Dennis Shirshikov called this benefit multifaceted because “… parents are able to maintain their productivity and mental health which is crucial for those managing businesses or high-stress careers.”
7 Major Differences Between Rich and Poor People
7 Major Differences Between Rich and Poor People, According To Money Expert Humphrey Yang
Adam Palasciano Tue, July 23, 2024 GOBankingRates
Of course, everyone wants to be rich. The idea of not having to worry about money seems like a dream for most. But, becoming rich takes lots of discipline and determination. The reality is that it’s easier to be poor.
In a recent YouTube video from financial guru Humphrey Yang, he outlined the seven major differences between rich and poor people that are important to understand.
If you want to become rich, you’ll need to understand the key differences between the rich and the poor.
7 Major Differences Between Rich and Poor People, According To Money Expert Humphrey Yang
Adam Palasciano Tue, July 23, 2024 GOBankingRates
Of course, everyone wants to be rich. The idea of not having to worry about money seems like a dream for most. But, becoming rich takes lots of discipline and determination. The reality is that it’s easier to be poor.
In a recent YouTube video from financial guru Humphrey Yang, he outlined the seven major differences between rich and poor people that are important to understand.
If you want to become rich, you’ll need to understand the key differences between the rich and the poor.
The Rich Are Subtle About Their Wealth
The rich are more focused on “stealth wealth”: they’re not trying to impress people with fancy cars, designer clothes and handbags, or expensive vacations. They’re modest and they’ve developed financial freedom and autonomy, rather than spending money on discretionary purchases.
When poor people come into money for the first time, they’re tempted to go out and spend money on things that they believe will give them some sort of status. This is exactly how not to become rich
The Rich Know It Takes Money To Make Money
The rich save and invest their money rather than spend it right away. They understand the idea of leveraging capital to scale their well. Poor people frequently tend to spend money rather than save money.
The reality is that the more you save, the easier it is for your money to work for you. Reaching a 6 figure portfolio is key to accelerating your financial growth.
The Rich Understand Delayed Gratification
The rich know that resisting impulsive purchases will lead to a big payoff later in life. Poor people tend to spend money on the things that bring them gratification now rather than save and invest that money for the future. Delayed gratification and stretching out your time horizon are both key to long-term wealth accumulation.
The Rich Invest in Assets
Rich people love to invest in assets. Poor people tend to just leave their money in a savings account rather than invest it. An asset is defined as a resource with an economic value that will provide a benefit to you at a later point in time. Assets can include real estate, stocks, index funds, retirement funds, etc. Typically, assets go up in value and some pay you just for owning the asset.
TO READ MORE:
https://www.yahoo.com/news/finance/news/7-major-differences-between-rich-195149153.html
When’s The Right Time To Turn Off The Tap?
Nearly half of young Americans rely on the bank of Mom and Dad to get by — When’s The Right Time To Turn Off The Tap?
Chris Clark Mon, July 22, 2024 Moneywise
A new report from Bank of America suggests Gen Zers are relying on financial help from Mom and Dad — a “parent trap” that raises big questions about financial independence and the long-term impacts on their parents’ financial health, particularly their retirement savings.
The study found that 46% of adult Gen Z-ers rely on financial help from their parents, ranging from covering everyday expenses to helping with significant financial commitments such as rent, mortgage payments and other debt repayments.
About one in four respondents to BoA’s study said housing expenses were a chief barrier to financial independence, and over half said they do not pay for their housing.
Nearly half of young Americans rely on the bank of Mom and Dad to get by — When’s The Right Time To Turn Off The Tap?
Chris Clark Mon, July 22, 2024 Moneywise
A new report from Bank of America suggests Gen Zers are relying on financial help from Mom and Dad — a “parent trap” that raises big questions about financial independence and the long-term impacts on their parents’ financial health, particularly their retirement savings.
The study found that 46% of adult Gen Z-ers rely on financial help from their parents, ranging from covering everyday expenses to helping with significant financial commitments such as rent, mortgage payments and other debt repayments.
About one in four respondents to BoA’s study said housing expenses were a chief barrier to financial independence, and over half said they do not pay for their housing.
Rising costs of living, inflation, student loan debt and economic instability have made it increasingly difficult for young adults to achieve financial independence. The COVID-19 pandemic exacerbated these issues, leading to job losses and reduced income that disproportionately affected younger workers.
The Bank of America study highlights a significant trend of young adults relying on their parents, but it’s essential for parents to recognize the long-term risks. By setting clear boundaries, providing financial education and gradually reducing support, parents can help their children become financially independent while safeguarding their own futures.
Risks to parents
While providing financial assistance to adult children can be a way for parents to show support and ensure their children’s well-being, it comes with significant risks, chiefly the impact on the parents’ own financial security and leaving their children unprepared to handle their own finances.
Financial expert Suze Orman warns that continuing to support adult children can severely compromise parents’ ability to retire comfortably. Orman argues parents often underestimate the long-term financial implications of this support, which can reduce their own savings when they need it the most.
Impact on retirement savings
Parents who use their retirement savings to support their adult children may find themselves in a precarious financial situation. Some parents are still supporting their children well into their 40s, delaying their own retirement and putting their financial future at risk. This prolonged financial support can lead to parents working longer than planned or significantly adjusting their retirement lifestyle to accommodate the shortfall in savings.
TO READ MORE: https://www.yahoo.com/news/finance/news/nearly-half-young-americans-rely-142500016.html
I’m Comfortably Middle Class: The Best Money Advice I Ever Took
I’m Comfortably Middle Class: The Best Money Advice I Ever Took
Andrew Lisa Sun, July 21, 2024 GOBankingRates
Financial publications love interviewing billionaires to learn about the money advice that propelled people like Bill Gates, Beyonce, Jeff Bezos and Warren Buffett to 10-, 11- and 12-figure success.
But how many people do you really know on the Forbes Richest list?
It might be more practical to learn about the advice that helped people with typical backgrounds and average salaries achieve stability and security in America’s ever-shrinking middle class.
GOBankingRates spoke with a business owner who went from financially faltering to fiscally fabulous in just a few years after building her money mindset around a simple yet transformative quartet of financial wisdom that she received when times were tough.
Times are not tough anymore.
I’m Comfortably Middle Class: The Best Money Advice I Ever Took
Andrew Lisa Sun, July 21, 2024 GOBankingRates
Financial publications love interviewing billionaires to learn about the money advice that propelled people like Bill Gates, Beyonce, Jeff Bezos and Warren Buffett to 10-, 11- and 12-figure success.
But how many people do you really know on the Forbes Richest list?
It might be more practical to learn about the advice that helped people with typical backgrounds and average salaries achieve stability and security in America’s ever-shrinking middle class.
GOBankingRates spoke with a business owner who went from financially faltering to fiscally fabulous in just a few years after building her money mindset around a simple yet transformative quartet of financial wisdom that she received when times were tough.
Times are not tough anymore.
Retirement Planning: Whether you're planning for retirement, dealing with a significant life event or simply looking to make smarter financial decisions, a financial advisor can offer the expertise and guidance you need. Here are some compelling reasons why you should consider a financial advisor -- even if you're not wealthy.
There Isn’t a Secret To Achieving Financial Security. There Are 4 Secrets.
Lisa Rehurek is the CEO and founder of The RFP Success Company, which specializes in consulting, training, and support services for medium-sized service-based companies bidding on state, local and education (SLED) requests for proposals (RFPs).
She is, by any reasonable standard, comfortably in the middle class — and she credits her financial security to a four-part piece of money guidance that she had the good sense to follow.
“The best financial advice I ever received as a middle-class person was to always live below my means, automate savings by putting 15% of every paycheck straight into investments and savings, understand needs from wants and cut back on frivolous spending to make money for bigger, more meaningful goals,” Rehurek told GOBankingRates.
When she received these pointers, she was in the best possible place to put them to good use — the bottom.
Sound Advice Turns a Halting Start Into a Trot. Then a Gallop.
TO READ MORE: https://www.yahoo.com/news/finance/news/m-comfortably-middle-class-best-200200410.html
Robert Kiyosaki: Why Saving Money Is the Wrong Way To Prepare for Retirement
Robert Kiyosaki: Why Saving Money Is the Wrong Way To Prepare for Retirement
Yaël Bizouati-Kennedy Sun, July 21, 2024 GOBankingRates
Robert Kiyosaki, the bestselling author of “Rich Dad Poor Dad,” has argued — against conventional wisdom — that “the historical advice to ‘save’ is no longer a sufficient way to prepare for retirement.”
According to the “Rich Dad” blog, you won’t be able to retire if you rely on saving money alone. Instead, Kiyosaki said adjusting your mindset is the key to preparing for retirement in the right way.
That, in addition to investing and creating steady cash flow, is his preferred method of staying financially secure during retirement.
Robert Kiyosaki: Why Saving Money Is the Wrong Way To Prepare for Retirement
Yaël Bizouati-Kennedy Sun, July 21, 2024 GOBankingRates
Robert Kiyosaki, the bestselling author of “Rich Dad Poor Dad,” has argued — against conventional wisdom — that “the historical advice to ‘save’ is no longer a sufficient way to prepare for retirement.”
According to the “Rich Dad” blog, you won’t be able to retire if you rely on saving money alone. Instead, Kiyosaki said adjusting your mindset is the key to preparing for retirement in the right way.
That, in addition to investing and creating steady cash flow, is his preferred method of staying financially secure during retirement.
Retirement Planning: Whether you're planning for retirement, dealing with a significant life event or simply looking to make smarter financial decisions, a financial advisor can offer the expertise and guidance you need. Here are some compelling reasons why you should consider a financial advisor -- even if you're not wealthy.
401(k)s Are the Problem
According to Kiyosaki, the biggest problem with the 401(k) is that it requires people with no financial education to be in charge of their retirement investing.
His blog read, “Because people had no financial education, a whole new industry was created — financial planning. The problem with financial planners is that they’re salespeople, not investors. They push the products of their employers, usually paper assets.”
How To Prepare for Retirement — the Right Way
According to Kiyosaki’s blog post, Americans need to shift their mindset. For instance, instead of saying, “I can’t afford that,” ask instead: “How can I afford that?”
To read more: https://www.yahoo.com/finance/news/robert-kiyosaki-why-saving-money-120024273.html
The Complications and Benefits of Sharing a Bank Account
Should married couples merge their finances?
Sean Kernan YAHOO CREATOR Updated June 18, 2024
Brian’s complaining went from a weekly affair, to a daily nuisance. We convened in a shared office gym each day. He was a well spoken and well paid engineer in his late 30s, and was having incrementally larger arguments with his wife over money.
It made no sense on paper. Both of them made more than $100K per year and lived in a low-cost area of Florida. Money should have been the last of their concerns. Yet every day in the gym, he’d groan, “She is constantly questioning every purchase.” Or, “I can’t even spend my own money without a fight.”
They’d succumbed to lifestyle inflation, which occurs when your spending rises alongside your income. They’d wracked up debt buying a bigger house and fancier cars. They’d also put their kids in a slightly-nicer private school that cost twice as much, which created resentment on Brian’s side.
And, as they’d added these costs, they’d also combined bank accounts. Because I was working as a budget manager for our company, and perhaps because we were friends, he thought I could help him navigate this domestic maze. But Brian’s problems appeared much deeper than just money. Sadly, he and his wife split just one year later.
Unsurprisingly, money and finances are a key factor in many divorces. Even with the best of intentions, a shared bank account can unleash a wave of problems that are hard to resolve. Yet combining accounts can be quite beneficial. So how do we navigate this predicament?
The Complications and Benefits of Sharing a Bank Account
Should married couples merge their finances?
Sean Kernan YAHOO CREATOR Updated June 18, 2024
Brian’s complaining went from a weekly affair, to a daily nuisance. We convened in a shared office gym each day. He was a well spoken and well paid engineer in his late 30s, and was having incrementally larger arguments with his wife over money.
It made no sense on paper. Both of them made more than $100K per year and lived in a low-cost area of Florida. Money should have been the last of their concerns. Yet every day in the gym, he’d groan, “She is constantly questioning every purchase.” Or, “I can’t even spend my own money without a fight.”
They’d succumbed to lifestyle inflation, which occurs when your spending rises alongside your income. They’d wracked up debt buying a bigger house and fancier cars. They’d also put their kids in a slightly-nicer private school that cost twice as much, which created resentment on Brian’s side.
And, as they’d added these costs, they’d also combined bank accounts. Because I was working as a budget manager for our company, and perhaps because we were friends, he thought I could help him navigate this domestic maze. But Brian’s problems appeared much deeper than just money. Sadly, he and his wife split just one year later.
Unsurprisingly, money and finances are a key factor in many divorces. Even with the best of intentions, a shared bank account can unleash a wave of problems that are hard to resolve. Yet combining accounts can be quite beneficial. So how do we navigate this predicament?
The give and take
In the 1970s and 80s, keeping separate accounts was seen as bad luck for a marriage. This legacy belief is less present today, but still harbors itself in more traditional circles. A study by Bank of America found that couples share accounts less and less in recent years. Young people are marrying later, after they’ve better established their careers. Additionally, in prior decades, women worked less and depended on husbands and needed account access.
Research shows that couples who share finances are happier — but, and it is a big but — it’s hard for researchers to know if they’re happier because they share an account, or if they share an account because they were already happy. The cited perk is that sharing promotes an “us” dynamic, a sense of unity that also promotes transparency.
I asked several married friends about their financial arrangement and each had surprisingly strong opinions. One looked at me incredulously and said, “People still share bank accounts? That is such a bad idea.” Another came in hot from the other side, saying, “We share an account. That’s pretty much how every marriage goes.” He was insistent, even though data shows that only 52–65% of couples in western nations use a joint-account.
An older female friend said that when she shared an account, her husband ran off and spent on things they never agreed to. When they separated, he effectively cleaned out her half, which left her in a financial pit. It took her years and a lawsuit to get her money back.
One option is a hybrid approach, where you have a shared expense account and separate personal accounts. This way you are tapping into the benefits of feeling like a team, while keeping yourself protected.
To read more: https://www.yahoo.com/lifestyle/story/the-complications-and-benefits-of-sharing-a-bank-account-204402760.html
The Best Strategy for Financial Freedom and Retiring Early
The Best Strategy for Financial Freedom and Retiring Early
Ghazal Ahmed Fri, July 19, 2024 Insider Monkey
This article takes a look at the best strategy for financial freedom and retiring early. Check out our complete list of 20 Strategies for Financial Freedom and Retire Early.
Here are the strategies for financial freedom and retiring early:
20. Run the numbers
According to T. Rowe Price, your likelihood of an early retirement starts with evaluating your current savings rate and spending levels. Using online retirement income calculators is a good start, allowing individuals to assess their likelihood of early retirement based on their current planning levels.
By accounting for factors such as current levels of saving, life expectancy, and expected retirement age, retirement calculators allow individuals to make informed goals about investing, saving, and spending habits.
19. Clearly Define Your Financial Goals
Once an individual has assessed where they currently stand, it’s time for them to clearly define their financial goals. Start by setting specific, measurable, achievable, relevant, and time-bound (SMART) goals. For instance, “I want to retire early” is a vague goal.
The Best Strategy for Financial Freedom and Retiring Early
Ghazal Ahmed Fri, July 19, 2024 Insider Monkey
This article takes a look at the best strategy for financial freedom and retiring early. Check out our complete list of 20 Strategies for Financial Freedom and Retire Early.
Here are the strategies for financial freedom and retiring early:
20. Run the numbers
According to T. Rowe Price, your likelihood of an early retirement starts with evaluating your current savings rate and spending levels. Using online retirement income calculators is a good start, allowing individuals to assess their likelihood of early retirement based on their current planning levels.
By accounting for factors such as current levels of saving, life expectancy, and expected retirement age, retirement calculators allow individuals to make informed goals about investing, saving, and spending habits.
19. Clearly Define Your Financial Goals
Once an individual has assessed where they currently stand, it’s time for them to clearly define their financial goals. Start by setting specific, measurable, achievable, relevant, and time-bound (SMART) goals. For instance, “I want to retire early” is a vague goal.
However, “I want to retire by the age of 50” is specific. SMART goals can help individuals formulate a targeted plan that includes timelines, money goals, and tangible benchmarks. The FIRE movement states that an individual needs to build up a net worth of 25 times their estimated annual expenses and spending to achieve financial independence.
18. Create a Detailed Plan
Creating a detailed plan outlining how one will go about achieving one’s goals will take them to the next step towards financial freedom and early retirement. From setting timelines to allocating resources, there is plenty to cover in this detailed plan.
Individuals should make sure to include a detailed budget that reduces unnecessary expenses and creates some savings after accounting for all necessary expenses. The FIRE movement prioritizes saving and investing 50 to 70% of income, if not more.
17. Financial Education
Financial education has a huge impact on the quality of retirement and the decisions that one makes towards it. Therefore, one strategy for financial freedom and early retirement is being financially literate.
According to data from the 2022 TIAA Institute P-Fin Index, retirees with high financial literacy were “more likely to plan and save for retirement” than those who were not. Having longevity knowledge is another prerequisite as appropriate decision-making related to retirement is contingent upon understanding how long a retirement can last.
16. Minimize Debt
Building up savings is important, but so is clearing off debt. This is because debt interests may far outstrip the interest on savings that you may earn. Charles Schwab recommends prioritizing debts instead of trying to pay them all at once. Credit card debts should be a first priority, with a primary focus on high-interest debt. One may make minimum payments on the rest, if possible.
Be careful of loan consolidation offers as many of them have upfront fees and hidden costs. Also, minimizing debt and saving for retirement can be done together. The way is to save enough in your retirement account to leverage the entire employer match, pay off high-interest debt, create emergency funds, and then save some more for retirement.
15. Pay Off Mortgage
To read more:
https://www.insidermonkey.com/blog/20-strategies-for-financial-freedom-and-retire-early-1324604/
7 Biggest Ways You’re Wasting Money While Traveling
7 Biggest Ways You’re Wasting Money While Traveling
Andrew Lisa Fri, July 19, 2024 GOBankingRates
Travel demand continues to soar, and naturally, prices have soared along with it.
If you have a vacation coming up, you should expect to spend more — but you should also strategize to spend less wherever you can. Knowing which purchases don’t deserve your dollars, pesos and euros is the best way to start.
Here are the most common budget-busting wastes of money to avoid when you travel.
Buying Pricey Gift Shop Trinkets
The easiest way to waste your money on any vacation is in the gift shop. Usually, the shot glass, coffee mug or indigenous mask you splurge on winds up collecting dust in a box soon after your return flight touches down.
7 Biggest Ways You’re Wasting Money While Traveling
Andrew Lisa Fri, July 19, 2024 GOBankingRates
Travel demand continues to soar, and naturally, prices have soared along with it.
If you have a vacation coming up, you should expect to spend more — but you should also strategize to spend less wherever you can. Knowing which purchases don’t deserve your dollars, pesos and euros is the best way to start.
Here are the most common budget-busting wastes of money to avoid when you travel.
Buying Pricey Gift Shop Trinkets
The easiest way to waste your money on any vacation is in the gift shop. Usually, the shot glass, coffee mug or indigenous mask you splurge on winds up collecting dust in a box soon after your return flight touches down.
“Most tourist destinations have souvenir shops that charge significantly higher prices for their merchandise compared to the local markets that are outside the tourist hotspots,” said Kevin Mercier, founder of the travel blog Kevmrc.com. “Travelers often end up wasting their money by purchasing souvenirs like keychains, shirts, and magnets at these over-priced shops. I always compare prices at different shops before purchasing, which helps me make a more informed decision.”
Overspending on Hotels
As the COO of Exotic Voyages, a luxury travel company offering private and custom-made tours, James Thai knows it’s easy to save money on hotels and resorts no matter your budget or lifestyle. However, it’s also just as easy to overspend.
“One of the biggest money traps for travelers is splurging on accommodations,” said Thai. “While a comfortable stay is important, it doesn’t mean you have to break the bank. Avoid overpaying for hotels in prime locations or choosing luxury options when budget-friendly alternatives are available. Consider staying in guesthouses, hostels or vacation rentals, which often offer excellent value for money without compromising quality. Additionally, booking your accommodation well in advance or taking advantage of last-minute deals can help you secure affordable rates.”
Dining at Tourist Traps
When you eat at the crowded and trendy restaurants you see in hotel and train station brochures, overspending is always on the menu.
“Another common mistake is falling into the tourist trap of expensive and mediocre restaurants,” said Thai. “Instead of dining at heavily advertised tourist hotspots, explore local eateries and street food stalls where you can savor authentic cuisine at a fraction of the cost. Engage with locals or consult online resources to discover hidden gems that offer delicious food and an immersive cultural experience. Not only will you save money, but you’ll also embark on culinary adventures that create lasting memories.”
Paying Foreign Transaction Fees
Although overpriced souvenirs and tourist-trap restaurants are ill-advised purchases for tourists on a budget, at least they give you something to show for your dollars. But when you pay for the privilege of spending money, you might as well just throw your cash in the trash.
“One of the things people spend the most amount of money on unnecessarily are foreign transaction fees,” said Nicole Cueto, a certified travel advisor with Fora Travel who’s visited 41 countries and all seven continents. “When paying for something abroad with your credit card and prompted with the choice of whether to pay in the local currency or your home currency, always choose the local currency. You’ll get the best conversion rate. It might not seem like a big difference, but it adds up.”
T0 READ MORE: https://www.yahoo.com/finance/news/7-biggest-ways-wasting-money-133021858.html
Does It Seem That Every American Has More Money Than You?
Does It Seem That Every American Has More Money Than You?
Here’s why everyone in America seems to have more money than you. It may not be what you think
Vawn Himmelsbach Updated Thu, July 18, 2024 Moneywise
If your friends, family, and coworkers always seem to be dining out, going to parties, taking exotic vacations — and maybe even paying $2,000 each for Taylor Swift tickets — while you clip coupons for groceries, you might feel like everyone you know has more money than you.
This could be especially painful if you’re feeling the pinch of inflation, right down to your grocery bill.
But Americans have a lot of debt. In fact, U.S. household debt reached $17.69 trillion in the first quarter of this year, according to data from the Federal Reserve Bank of New York (FRBNY). Although inflation has been mostly declining over the past two years — after pandemic highs — the Consumer Price Index increased 3.3% during the 12 months ending May 2024.
As if the debt weren’t enough, almost half of Americans (48.6%) consider themselves “broke,” according to a MarketWatch Guides survey, with about two-thirds (66.2%) “living paycheck to paycheck.”
Considering the financial instability of everyday Americans, why does it appear like everyone is living the high life — except you?
Does It Seem That Every American Has More Money Than You?
Here’s why everyone in America seems to have more money than you. It may not be what you think
Vawn Himmelsbach Updated Thu, July 18, 2024 Moneywise
If your friends, family, and coworkers always seem to be dining out, going to parties, taking exotic vacations — and maybe even paying $2,000 each for Taylor Swift tickets — while you clip coupons for groceries, you might feel like everyone you know has more money than you.
This could be especially painful if you’re feeling the pinch of inflation, right down to your grocery bill.
But Americans have a lot of debt. In fact, U.S. household debt reached $17.69 trillion in the first quarter of this year, according to data from the Federal Reserve Bank of New York (FRBNY). Although inflation has been mostly declining over the past two years — after pandemic highs — the Consumer Price Index increased 3.3% during the 12 months ending May 2024.
As if the debt weren’t enough, almost half of Americans (48.6%) consider themselves “broke,” according to a MarketWatch Guides survey, with about two-thirds (66.2%) “living paycheck to paycheck.”
Considering the financial instability of everyday Americans, why does it appear like everyone is living the high life — except you?
Racking up credit card debt
Americans have an enormous amount of credit card debt. Outstanding balances on credit cards reached a grand total of $1.12 trillion in Q1 — up 13.1% from the same period last year — according to data from FRBNY.
This is a grim milestone, as 2023 was the first time outstanding credit card balances surpassed the $1 trillion mark.
Another Bankrate survey found that 49% of credit card holders were carrying a balance from month to month in 2023. In some cases, Americans may be relying more on their credit cards as their finances are stretched thin, thanks to the higher cost of everyday expenses and higher interest rates on credit and loans.
But with credit card interest rates around the 21% mark — and in some cases as high as 30% — using a credit card to foot bills or bridge monthly shortfalls can be a losing game. If you buy groceries with a credit card and only make the minimum monthly payments, it could take years to pay off that bill, since you’ll be paying back the interest rather than the principal.
In other cases, people might be living the high life by charging everything to their credit cards (or even taking out loans), while ignoring the consequences. So, while it might look like they have a lot of disposable income, they’re racking up more and more debt, which eventually will catch up with them.
Making lifestyle sacrifices or trade-offs
Maybe one of your friends always seems to be traveling to yet another exotic locale. It’s possible they’re living beyond their means, but they could also be making sacrifices in other areas to prioritize travel. For example, maybe they’ve chosen not to buy a car and use public transit instead, so they can funnel more of their budget toward travel.
A LendingTree study of census data found that 18.3 million homeowners in the U.S. spend more than 30% of their monthly income on housing. So if someone you know has a beautiful home, they may have chosen to make sacrifices in other areas — such as entertainment expenses or vacations — so they can afford their home.
Some people you know may be working long hours and missing time with family and friends in order to fund their lifestyle. They also might be working side hustles to bump up their disposable income.
TO READ MORE:
https://news.yahoo.com/news/finance/news/why-everyone-america-seems-more-105500103.html
7 Questions You Should Never Answer When Buying a Car
7 Questions You Should Never Answer When Buying a Car
Andrew Lisa Thu, July 18, 2024 GOBankingRates
Unless you live for the wheel and deal, car dealerships can be an intimidating place for potential buyers. Not only are you entering an unfamiliar territory inhabited by experts, but there’s a lot of pressure to make the right choice.
Expensive to buy and maintain, worth less and less with each mile driven, car ownership can be both a burden and a necessity. According to Kelley Blue Book, the average new car price was a record high $48,644 in June 2024 — just $266 more than the month before and $307 lower than in June 2023.
It’s might not always be possible to enjoy the car buying experience, but you can certainly reduce anxiety by knowing what you want and keeping certain information close to your chest. Read on for seven questions you should never answer when buying a car.
7 Questions You Should Never Answer When Buying a Car
Andrew Lisa Thu, July 18, 2024 GOBankingRates
Unless you live for the wheel and deal, car dealerships can be an intimidating place for potential buyers. Not only are you entering an unfamiliar territory inhabited by experts, but there’s a lot of pressure to make the right choice.
Expensive to buy and maintain, worth less and less with each mile driven, car ownership can be both a burden and a necessity. According to Kelley Blue Book, the average new car price was a record high $48,644 in June 2024 — just $266 more than the month before and $307 lower than in June 2023.
It’s might not always be possible to enjoy the car buying experience, but you can certainly reduce anxiety by knowing what you want and keeping certain information close to your chest. Read on for seven questions you should never answer when buying a car.
“How Much Do You Know About Cars?”
When it comes to a major purchase, never put yourself at a disadvantage. If you’re planning on spending thousands on a new vehicle, you have to do your research.
That said, even if you know less than nothing about cars, don’t let a salesperson know. Dealers are trying to sell cars as eagerly as you want to buy one.
Get a good idea of what you want, check reputable website rankings and don’t buy any car you’re unsure of — it’ll remind you every day of the mistake you’ve made.
A salesperson wants to make the biggest commission possible. To do that they want to take the reins and guide you through the process on their terms, not yours.
“Why Do You Need a New Car?”
There’s no reason to be insolent, but the reason you’re buying a new car is irrelevant to a salesperson/stranger. Divulging personal, professional or financial information — or even a motive — while buying a new-to-you vehicle is unnecessary during the negotiating of a sale.
When you drive your clunker into a dealership hoping that you’ll be landing the car of your dreams, you’re the one in charge, regardless of how poor that clunker looks and rides. Even if you’re desperate, knowing exactly what you want will have the salesperson following your lead.
“How Much Are You Willing To Pay Monthly?”
To Read More: https://www.yahoo.com/news/finance/news/7-questions-never-answer-buying-130031537.html
7 Ways To Start Building Wealth Like the Rich
7 Ways To Start Building Wealth Like the Rich
Jordan Rosenfeld Wed, July 17, 2024 GOBankingRates
The wealthy may seem to have some financial magic or luck that the average person does not. However, most of their strategies are not all that complicated.
While the rich may have more money to work with than you, with the power of compound interest and other strategies, building wealth is something anyone can learn how to do. Read on to explore the seven steps to start building wealth like the rich.
Diversify Investments
Investing wisely and diversifying one’s portfolio was a hallmark of wealth-building strategies in the previous year, according to Khwan Hathai, CFP and certified financial therapist at Epiphany Financial Therapy. “This approach, rooted in the principle of not putting all one’s eggs in one basket, involves spreading investments across various asset classes to mitigate risk while capitalizing on growth opportunities.”
7 Ways To Start Building Wealth Like the Rich
Jordan Rosenfeld Wed, July 17, 2024 GOBankingRates
The wealthy may seem to have some financial magic or luck that the average person does not. However, most of their strategies are not all that complicated.
While the rich may have more money to work with than you, with the power of compound interest and other strategies, building wealth is something anyone can learn how to do. Read on to explore the seven steps to start building wealth like the rich.
Diversify Investments
Investing wisely and diversifying one’s portfolio was a hallmark of wealth-building strategies in the previous year, according to Khwan Hathai, CFP and certified financial therapist at Epiphany Financial Therapy. “This approach, rooted in the principle of not putting all one’s eggs in one basket, involves spreading investments across various asset classes to mitigate risk while capitalizing on growth opportunities.”
For someone looking to emulate this, Hathai suggested starting to invest in a mix of financial products such as stocks, bonds, real estate or even exploring newer areas like cryptocurrencies or ESG (environmental, social and governance) investing, depending on one’s risk tolerance and financial goals.
Focus on Growth over Gains
A focus on long-term growth over short-term gains has always been a distinguishing factor of affluent investors as well, Hathai said. “[The rich] look beyond the volatility of markets, concentrating on assets and ventures that promise sustainable growth.”
She encouraged a patient and focused approach to investing, where the emphasis is on the interest appreciation over years or decades, rather than quick wins.
Utilize Tax Advantaged Accounts
To Read More: https://www.yahoo.com/news/finance/news/7-ways-start-building-wealth-123008400.html
5 Moves Every Woman Should Consider Before Retirement
5 Moves Every Woman Should Consider Before Retirement
May 23, 2024 by Jennifer Taylor
Retirement should be relaxing. However, it’s hard to relax if you’re weighed down with financial woes.
As a woman, you probably spend much of your life taking care of others. However, you also need to take care of yourself, which includes ensuring your finances are ready for retirement.
Whether you’re planning to retire in the next few years or the next few decades, you’ll need to do a lot of planning. The more prepared you are, the better your chances of being in a good financial place to enjoy your golden years.
Wherever you are in your journey, here’s a look at five moves every woman should consider before stepping away from the workforce.
5 Moves Every Woman Should Consider Before Retirement
May 23, 2024 by Jennifer Taylor
Retirement should be relaxing. However, it’s hard to relax if you’re weighed down with financial woes.
As a woman, you probably spend much of your life taking care of others. However, you also need to take care of yourself, which includes ensuring your finances are ready for retirement.
Whether you’re planning to retire in the next few years or the next few decades, you’ll need to do a lot of planning. The more prepared you are, the better your chances of being in a good financial place to enjoy your golden years.
Wherever you are in your journey, here’s a look at five moves every woman should consider before stepping away from the workforce.
1. Estimate How Much You’ll Spend in Retirement
You can’t know if you have enough saved for retirement without estimating the amount you’ll spend each year.
Generally speaking, people tend to spend 55% to 80% of their current income each year in retirement, according to Fidelity®. Of that, approximately 15% of expenditures are healthcare related2.
Therefore, if your ending salary was $100,000 per year, you’ll likely need $55,000 to $80,000 per year in retirement — including approximately $15,000 in healthcare-related expenses.
It’s also important to think of the lifestyle you desire in retirement, as this will largely drive your cost of living. For example, you might save money by no longer having to commute to work and downsizing to a smaller home, but you could also spend more with frequent travel or buying a vacation home.
There’s no one-size-fits-all approach to retirement spending, so take the time to customize your plan to fit your lifestyle.
2. Devise an Income Plan
Right now, you pay for your expenses with your weekly, bi-weekly or monthly paycheck. However, this steady paycheck will come to an end when you retire.
Chances are, you’ll have a variety of income streams in retirement — Social Security, perhaps a pension, an annuity, a 401(k), etc. This is great, but you’ll need to figure out which accounts you’ll be tapping to pay your monthly bills.
It can be wise to work with a financial planner on this, as they can help you create a plan that minimizes taxes, while maximizing future earnings. This will ensure you’re truly getting the most from your money.
To Read More:
The ‘Hermit’ Savings Rules: 8 Frugal Tips for Today’s Economy
The ‘Hermit’ Savings Rules: 8 Frugal Tips for Today’s Economy
Cindy Lamothe Tue, July 16, 2024 GOBankingRates
Consumer habits across the world have been altered significantly over the past few years — for obvious reasons and otherwise — in what economists have dubbed “the age of the hermit consumer.”
“For ‘hermit’ consumers, it can be really easy to make impulse purchases and overspend because of how easy and convenient shopping online is,” said Carter Seuthe, CEO of Credit Summit Consolidation. “Something that can be helpful to maintain a more frugal budget is just to define your expectations and priorities when it comes to the amenities you have.”
Below are some expert rules for living more frugally in today’s economy.
The ‘Hermit’ Savings Rules: 8 Frugal Tips for Today’s Economy
Cindy Lamothe Tue, July 16, 2024 GOBankingRates
Consumer habits across the world have been altered significantly over the past few years — for obvious reasons and otherwise — in what economists have dubbed “the age of the hermit consumer.”
“For ‘hermit’ consumers, it can be really easy to make impulse purchases and overspend because of how easy and convenient shopping online is,” said Carter Seuthe, CEO of Credit Summit Consolidation. “Something that can be helpful to maintain a more frugal budget is just to define your expectations and priorities when it comes to the amenities you have.”
Below are some expert rules for living more frugally in today’s economy.
Embrace a DIY Mentality
“DIY is my new favorite hobby,” said Andrei Vasilescu, co-founder and CEO of DontPayFull. “It’s cost effective, and YouTube is a great teacher. About 50% more people are getting into DIY now.”
Syed Lateef, business coach and CEO of SyedBNB, agrees.
“We can all see it,” Lateef said. “The focus has shifted towards a more home-oriented lifestyle, and I can personally say that more people are embracing do-it-yourself (DIY) activities.”
He said this is a good thing because mastering basic skills for home and car repairs can lead to considerable savings.
“Nowadays, the hundreds of online tutorials and resources makes it easier than ever to learn and perform these tasks ourselves,” he said, “reducing the need to hire professionals.”
Save Money by Cooking at Home
“The driving force behind the hermit economy isn’t entirely clear,” Lateef said.
He said it could be due to the lingering hesitation for close-contact services, the increase in remote work or a shift in social values.
“What’s obvious, though,” he said, “is that consumers are now more inclined to spend on home-centric activities.”
As a result, he said, many followers of the FIRE (financial independence, retire early) movement have come to realize that frequent dining out can be quite costly. So, frugal individuals are embracing the art of cooking at home, experimenting with budget-friendly and nutritious meals.
He added, “Hermit consumers save money but also encourage healthier eating habits.”
Focus on Secondhand Finds
In the current economic climate, looking at secondhand alternatives before buying new is a wise strategy, Lateef suggested.
“I believe that the ‘hermit’ consumers are now placing more emphasis on sustainability because of the pandemic, so shops like thrift stores and online marketplaces are trending because of the treasure troves of affordable, yet quality items.”
In terms of frugality, he said, this not only helps save money but also aligns with sustainable practices by repurposing and recycling items.
To Read More: https://www.yahoo.com/finance/news/hermit-savings-rules-8-frugal-140043078.html