Canadians are already planning to spend less, according to Deloitte Canada’s 2023 Holiday Retail Outlook. This is an annual forecast for retail businesses—but this year, there’s little for them to feel jolly about. According to a survey of 1,000 Canadians, we plan to spend an average of $1,347 over the 2023 holiday season. That’s down 11% from 2022’s forecast of $1,520 and nearly 27% from 2021’s forecast of $1,841. What are we cutting back on this year? Charitable donations (-40%), gifts (-18%) and gift cards (-14%).
Canadians are looking for the best holiday deals—and we’ll switch brands if necessary
Canadians always love getting deals, but we’re going to spend carefully this year and focus even harder on value, says Marty Weintraub, national retail leader at Deloitte Canada. “We’re seeing the money shift to what we call ‘extreme value.’ The top reasons for picking a retailer are: number one, reasonable prices, and number two, value for money,” he says, adding that shoppers plan to spend more at mass merchant retailers and warehouse membership clubs this year.
Other notable findings from the survey, conducted in September:
One in three Canadians are worried about how they will pay for gifts.
48% of Canadians intend to buy only what their family needs this season—up from 41% in 2022 and 35% in 2021.
76% of us expect prices to be higher this year, and 73% of us think retailers are raising prices unfairly.
We’ve become a nation of bargain hunters: 77% of us plan to shop around for the best deals, and 71% of us will switch brands if our preferred one is too pricey.
We don’t mind putting in the legwork—45% of us will visit multiple stores in the same area to get what we’re looking for. Overall, we’ll visit an average of 16.5 stores and websites (up 37% from 2022).
To afford holiday purchases, 24% of us will postpone travel plans, and 23% will cut back on our grocery budgets.
On the brighter side, some Canadians are still finding room in their budgets to indulge a little and to spend according to their values. According to the survey findings:
26% of us will treat ourselves to an experience such as a concert, sports event, trip or spa day.
More than half of us (55%), especially younger adults and women, are willing to spend more for products and services that are sustainable.
We’re planning to spend 11% more money on travel this holiday season than in 2022.
Despite tighter budgets this holiday season, we’re spending more on travel
How is travel spending rising when we’re cutting costs elsewhere? “Post-pandemic, we still have some revenge travel happening this holiday season,” says Weintraub. “Last December, if you went away, it was a gong show at the airport and with the airlines. As a result, some people said, ‘Not for me, I’ll do it later.’ Some of that’s coming back this year, but in the context of inflation hitting travel as well.”
Weintraub himself is taking his family on a trip over the holidays, and he expects to spend more than he would have last year. “I want to provide an experience for my family rather than buy things, and I want to go because I didn’t get to do it in the past couple of years,” he says. “I’m going to borrow from Peter to pay Pauline—take it out of one pocket and put [it] in another—and I’m willing to pay for more it.”
Canadians are worried about debt, high interest and job loss
Deloitte’s findings echo the results of other surveys. In mid-October, the MNP Consumer Debt Index shared that more Canadians are struggling with debt, high interest rates and concerns about job loss. Half of respondents reported that they are $200 or less from being unable to meet their financial obligations.
“There is no mystery as to what is causing Canadians’ bleak debt outlook: it’s getting increasingly difficult to make ends meet,” Grant Bazian, MNP’s president, said in a press release. “Facing a combination of rising debt-carrying costs, living expenses and concern over the potential for continued interest rate and price hikes, many Canadians are stretched uncomfortably close to broke.”
Many of us are also making sacrifices to afford our vacation plans. Forty one per cent of Canadians cut back on their grocery spending to afford travel, according to a survey by FlightHub Group. Plus, over one in four (28%) Canadians who can’t afford travel have taken on credit card debt to finance their trips, the survey found.
Nobody wants to come home from a relaxing holiday only to face a sizable credit card bill. (Yup, I’ve been there myself, and while I’m not proud, I’m not afraid to admit it.) Instead of taking on debt to pay for travel, try a combination of money-saving strategies and clever travel hacks from the experts. Here’s how to get started.
3 ways to save money on travel for Canadians
1. Choose an affordable destination
Where you go can make a big difference in cost. Danica Nelson is a personal finance influencer and avid traveller who’s visited 25 countries. When she’s not border-hopping, she maintains a home base in Toronto. Nelson says that choosing affordable destinations where she can stretch her Canadian dollar further—like Indonesia, Thailand and Vietnam, to name a few—has been key.
“In Vietnam, I could stay in a five-star hotel for as low as $55 Canadian per night. In Da Nang, you could get the freshest seafood available and a beer for $5 Canadian, or a banh mi sandwich for about $1 Canadian,” Nelson says. She’s even gotten a flower bath and one-hour massage for $60 Canadian in Bali. (FOMO-inducing, I know.) For more inspiration, check out four Canadian digital nomads who travel to, or live year-round in, affordable destinations like Panama, Costa Rica, Greece and more.
2. Use a travel credit card to save money and earn more travel points
Booking with a travel credit card can be a cheaper way to travel, since you may be able to get cheaper pricing on flights, hotels and rental cars through your credit card’s rewards program. With my co-branded CIBC Aeroplan Visa card, for example, I earn Aeroplan points on my purchases, and I can get preferred pricing on Air Canada flights. This means I can use fewer Aeroplan rewards points than the amount typically required to book flights.
Nelson adds that using a travel card can also help you avoid foreign transaction fees (typically around 2% to 3%) while you’re abroad, and earn more points to redeem towards hotels or flights for future trips.
Danica Nelson is pictured in Paris in front of the Eiffel Tower. Photo courtesy of Danica Nelson
3. Switch to carry-on luggage
Switching out your suitcase for a carry-on bag can help you save money and time at the airport. “Travelling with only a carry-on- has been a way that people have learned to save a lot of money by not having to pay for checked baggage fees,” Nelson says. She recommends investing in a small suitcase that fits the airline carry-on baggage size requirements and one personal item like a backpack, purse or tote bag. Check ahead of time whether your flight carrier charges for checked baggage, as in some cases, you could get a stowed suitcase for free with your ticket.
Personally, I’ve changed over to a small carry-on suitcase, and it’s saved me the hassle and cost of checked baggage. Some other hacks I use to save money on travel: I buy groceries for lunches and breakfasts. I also budget for dinners out ahead of time, and any other costs like coffees or treats here and there.
No, you don’t need to spend $4,500 on that 157-piece Le Creuset cookware set from Costco COST, -0.83%.
The pricey package has become an everyone-is-talking-about-it sensation, owing largely to social media. A post about the set on X, the platform formerly known as Twitter, that has now been viewed some 21 million times seems to have been the initial source of the buzz. It noted that the Costco offering has “probably every kitchen item you will ever need.”
In turn, that post generated more social-media chatter, along with articles in publications including the New York Post and the Delish website.
Now the set is apparently so popular, you can’t even get it. In several parts of the country, the Costco site doesn’t even list it as being available. MarketWatch reached out to the retailer for details but did not receive an immediate response.
Perhaps it’s just as well that home cooks won’t be tempted to spend all that money. When MarketWatch spoke with several prominent New York chefs and restaurateurs, they all said the set was overkill, even if it represented a savings compared with buying the items individually.
If anything, these culinary pros noted that purchasing so many pieces not only poses a storage issue, but it can also create confusion in the kitchen, especially for the home cook.
“I don’t even have one-tenth of that set,” says veteran chef Konstantinos Kvasilava, who works at Kyma, a high-end Greek restaurant in New York, and who previously was at Geranium, a Michelin-starred establishment in Copenhagen.
So what are the items you should buy for your kitchen? Here are five rules chefs say you should keep in mind.
Stick with the basics
The Costco Le Creuset set includes several pots and pans, plus bakeware, dinnerware and more. Let’s presume you already have some plates and utensils in your kitchen. Beyond that, chefs generally recommend a small number of pieces — think in terms of as few as four and as many as 10, says Franklin Becker, chef and owner of the Press Club Grill and Point Seven restaurants in New York. His must-have list includes 8-inch and 10-inch nonstick pans, a high-sided stainless-steel sauté pan and 1-quart, 4-quart and 8-quart pots. “Those are the essentials,” says Becker, explaining that such items will cover your needs depending on what you’re cooking — the nonstick pans are great for eggs, he notes — and how many people you’re cooking for. The 8-quart pot will work if you’re entertaining a crowd and need to make a big dish.
Other chefs’ must-haves include a cast-iron pan, often a preferred method for cooking steaks; a casserole dish, which is good for casseroles, naturally; and a Dutch oven. It’s always best to think of items that can be used in multiple ways. Rose Noel, executive chef at New York’s Peak restaurant, likes a cast-iron pan, for example, because it can go into the oven and can also be used on an outdoor grill. “It carries everywhere,” she explains. And, she says, a decent-sized casserole dish can double as a roasting pan for, say, cooking a chicken.
Add extras, depending on what you eat
One you have those basics, look at your daily diet and buy items that fit your own needs. Simon Kim, proprietor of Cote Korean Steakhouse, which has locations in New York and Miami, says he doesn’t make eggs at home for breakfast, but he always makes smoothies, so a powerful blender is a must for him. And he eats a lot of rice, so he has a rice cooker, which he says is much better than an everyday pot when it comes to preparing that staple.
Buy quality
It’s always tempting to go the cheap route, but chefs say you’ll pay for it in the end by having cookware that doesn’t last as long and doesn’t cook as well. Becker notes that aluminum cookware, which typically costs less, should be avoided at, well, all costs.
In terms of brand preferences, chefs mention many higher-end names, such as T-fal , All-Clad and Le Creuset. And when it comes to that blender for his morning smoothies, Kim says he swears by his Vitamix.
Avoid sets
The problem with buying any cookware set, even one with as few as 10 pieces, is that it often means duplicating items you already have, chefs say. Plus it doesn’t allow you to mix and match brands and take advantage of the fact that certain brands may be better than others for certain items.
Noel suggests you purchase cookware for your kitchen the same way you purchase clothes for your wardrobe. “Buy pieces to fill in what you’re missing or need to update,” she says.
Take care of what you own
Even the best cookware won’t measure up if you don’t treat it properly. Becker says it’s important to wash pots and pans pretty much immediately after each use so that food and grease don’t harden and become difficult to remove. And when it comes to that cast-iron pan, Becker suggests that it be seasoned and cleaned with salt before being oiled lightly to seal it.
Are you dreaming of a fabulous holiday without breaking the bank?
Credit card rewards programmes offer many ways to earn and redeem points for travel benefits, including flights, hotels, and restaurants. Indeed, numerous credit cards cater to travel enthusiasts, and if you play your cards right, you can maximise your points for your next vacation.
This article will show you how to do this by exploring 11 tried-and-trusted ways to maximise credit card points and embark on the holiday of your dreams.
Choose the right credit card
Choosing the right credit card is the first and most crucial step in leveraging your credit card points for your next holiday.
Your selection process should be tailored to your unique preferences and travel habits. However, you should consider factors such as airline and hotel partnerships, sign-up bonuses, earning potential, and annual fees. Opt for a card that aligns with your preferred hotel brands or airlines, such as Qantas (see Westpac’s article for more information) as this can lead to exclusive perks and benefits.
Sign-up bonuses are a powerful way to accumulate significant points quickly, but remember to meet any spending requirements within the stipulated time frame if required.
Additionally, the card’s earning potential is equally important, with some cards offering higher points for specific categories like dining, groceries, or travel expenses.
Lastly, it is worth keeping annual fees in mind. You should weigh these against the benefits and rewards the card offers.
Ultimately, your choice of credit card will be the foundation of your entire credit card points strategy, so research and choose wisely.
Understand your card’s rewards programme
Understanding your credit card’s rewards programme is vital if you want to optimise your travel points.
Each credit card programme operates differently, and having a comprehensive grasp of its specifics is essential. Pay attention to whether your card offers points or miles, and familiarise yourself with their value and redemption options.
Equally important is understanding the earning and redemption rules. Some cards have straightforward cashback rewards, while others may employ complex redemption structures with transfer partners and blackout dates. Additionally, be vigilant about points expiry dates to avoid losing hard-earned rewards.
Ultimately, the more you understand the intricacies of your card’s rewards programme, the more you can make informed decisions, strategically accumulate points, and ultimately unlock the full potential of your travel benefits.
Leverage everyday spending
Don’t be misled into thinking that maximising your credit card points for your upcoming holiday is just about big purchases. It’s also about leveraging everyday spending.
You can significantly boost your points balance by using your travel rewards credit card for routine expenses – from groceries and dining to bills and utilities.
Many cards offer higher points or cashback percentages for these categories, allowing you to accumulate points effortlessly over time. Additionally, explore online shopping portals and partnerships offered by your credit card company, as these can provide bonus points for making purchases at specific retailers.
If you incorporate your everyday spending into your credit card strategy, you can accumulate points steadily, bringing your dream holiday closer to a reality.
Use credit card perks
Using the perks that come with your travel rewards credit card can be a game-changer when planning your next holiday. Many of these cards offer a range of valuable benefits to enhance your travel experience.
From comprehensive travel insurance that covers trip cancellations and lost baggage, to access to airport lounges for a more comfortable pre-flight experience, these perks can save you a substantial amount of money and add convenience to your travels. Some cards even waive foreign transaction fees, making international trips more affordable.
Priority boarding, complimentary flight upgrades, and concierge services for restaurant reservations and local attractions can all elevate your journey further. By taking full advantage of these perks, you can make your holiday more enjoyable, stress-free, and cost-effective.
Timing is everything
Timing plays a critical role when maximising your credit card points for your next holiday.
First and foremost, plan your credit card application to coincide with your major expenses or travel purchases to meet sign-up bonus requirements. Also, keep an eye on limited-time promotions and bonus point opportunities that can significantly boost your points balance.
Timing your holiday shopping to align with increased spending during the holiday season can also help accumulate more points. Additionally, booking your flights and accommodations in advance is essential, as this often results in better availability and value when redeeming points.
Lastly, being flexible with your travel dates can be an excellent strategy to take advantage of lower point requirements during off-peak times.
Optimise your point redemption
Point redemption is key to getting the most value from your credit card rewards, and there are several strategies to consider when doing so.
First, explore transfer partners if your rewards programme offers this option. This can open up a world of possibilities for using your points across various airline and hotel loyalty programmes, often with more favourable redemption rates.
Booking your flights or accommodations in advance can help secure better availability and value, especially during peak travel times. At the same time, flexibility in your travel dates can lead to more significant savings, as off-peak times often require fewer points for redemptions.
Sometimes, using a combination of points and cash for bookings can stretch your points further and ensure you secure your desired travel plans.
Keep an eye on promotions
Staying vigilant and watching out for promotions is an intelligent approach to maximise credit card points for your next holiday.
Credit card companies frequently offer enticing promotions that significantly boost your points balance. These promotions may include bonus point offers, cashback incentives, or special discounts on specific spending categories or particular time frames.
Referral bonuses are another lucrative avenue to earn rewards. At the same time, welcome bonuses may periodically offer extra rewards for targeted spending.
Regularly checking your credit card issuer’s website, emails, or mobile app for these limited-time offers can maximise your points.
Monitor your account regularly
Monitoring your credit card account regularly ensures you receive the points you’ve earned for your purchases and keeps you updated on new promotions or offers. Make it a practice to check your monthly credit card statements to verify that you’ve received the appropriate points for your transactions.
If you spot any discrepancies, always contact your credit card issuer to resolve the issue. Setting up alerts for your account is also highly beneficial, as these can notify you about significant account activity, such as large purchases or changes to your credit limit.
Furthermore, keep a keen eye on promotional emails and notifications from your credit card issuer, as they often contain information about new offers, promotions and ways to earn extra points. Just ensure the emails you receive are genuine and not phishing scams, and act promptly to seize the opportunities to boost your points balance.
Combine points with a partner or family
Combining credit card points with a partner or family members can be a brilliant strategy to maximise your travel rewards for an upcoming holiday.
Many rewards programmes allow you to pool or transfer points among household members, which can be especially beneficial when booking multiple flights or hotel rooms for a family vacation.
To make the most of this approach, check the terms and conditions of your credit card to confirm if it permits pooling or transferring of points among household members. Also, coordinate spending with your partner or family members to ensure everyone contributes to maximising the points earned.
When booking your holiday, collaborate on using the combined points to secure flights, accommodations, or other travel expenses. This way, you can fully leverage the combined points balance to enjoy significant savings, making your dream holiday more affordable and accessible for everyone.
Be mindful of fees and interest
It is always worth being mindful of fees and interest to make the most of your credit card points.
While credit cards can offer many rewards and perks, they can also come with costs that you must manage carefully. Paying your balance in full each month is crucial to avoiding interest charges and maximising your rewards.
Credit card interest rates can be high, and any outstanding balance can quickly negate the value of the points or rewards you earn. Equally important is avoiding cash advances, which often involve steep fees and high interest rates. So make sure you monitor and evaluate the annual fees associated with your card, weighing them against the benefits and rewards it offers.
If you’re not fully utilising the card’s perks, consider downgrading to a no-annual-fee card, or even cancelling it if the fees outweigh the advantages. By staying vigilant about fees and interest, you can ensure that your credit card points work to your advantage rather than accumulating unnecessary costs.
Consider a premium travel card
Considering a premium travel card can be a wise move to maximise credit card points. Although often accompanied by higher annual fees, these top-tier cards offer many benefits that can dramatically enhance your travel experience.
For instance, they can grant you elite status with airline or hotel loyalty programmes, which translates to perks like complimentary room upgrades, priority boarding, and exclusive lounge access. At the same time, premium cards typically provide annual travel credits that can offset their fees and apply to various travel expenses, from airline fees to baggage fees. Additionally, they offer 24/7 concierge services that assist with restaurant reservations, local attractions, and even travel emergencies.
Many premium cards reimburse the application fee for programmes like Global Entry or TSA PreCheck, saving you time at security checkpoints. They also have enhanced travel insurance, including coverage for trip interruptions, cancellations, and travel accidents.
While the annual fee might put some people off, the value offered by a premium travel card can significantly enhance your travel experiences and make your dream holiday more luxurious and stress-free.
Conclusion
With the right strategies and a well-chosen credit card, maximising credit card points for your next holiday is an achievable goal.
By selecting the right card, utilising its benefits, and being mindful of your spending and redemptions, you can accrue enough points to embark on the holiday of your dreams without draining your bank account.
Whether you’re a frequent traveller or an occasional vacationer, the rewards and perks offered by travel rewards credit cards can make your journeys more affordable and enjoyable. So, choose your card wisely, spend strategically, and watch your points balance grow as you plan your next adventure.
This August, two years into their relationship, Yumi Temple and her boyfriend, Daniel, moved into their first apartment together, in Denver.
It was Temple’s first time living with another person, outside of family, and she quickly learned there was a lot to navigate.
The couple decided to see a therapist, to work through their differences and find the best ways to communicate. Temple, 28, recently quit her full-time job and is trying to get a business off the ground; Daniel is a full-time engineer.
“I just wanted somebody on speed dial to help us with the issues we’d inevitably come into,” Temple said.
Money is one of the biggest tension points for couples. And when people move in together for the first time, many financial questions and tasks arise, leaving room for disagreement and awkwardness.
Handling the transition proactively and honestly — and being open to vulnerability — can prevent a lot of problems along the way, experts say. Here’s a look at three financial tips for cohabitation.
One of the first conversations a couple moving in together should have is about how expenses will be paid, said Wynne Whitman, co-author of “Shacking Up: The Smart Girl’s Guide to Living in Sin Without Getting Burned.”
Splitting costs evenly is not always fair, experts point out — especially considering that women still earn, on average, 18% less than men, according to a Pew Research Center Analysis of Census Bureau data.
“Is every expense split 50-50? ” Whitman said. “Is there another arrangement if one partner earns more?”
“Making a decision and sticking to it removes a lot of stress.”
After Hailey Pinto and her boyfriend graduated from college in Connecticut, they decided to take a shot at living together.
Pinto works remotely from their one-bedroom apartment in Charlotte, North Carolina, where her boyfriend got a job offer at a bank. They don’t split their $1,900 monthly rent 50-50 but instead according to their income levels, since it is their biggest expense.
“It’s almost like a 60-to-40 split,” said Pinto, 21. Meanwhile, they share their other expenses evenly. “We try to keep it fair.”
When it comes to the lease (assuming you’re renting), experts recommend that everyone who lives in the apartment be on it.
Is every expense split 50-50? Is there another arrangement if one partner earns more? Making a decision and sticking to it removes a lot of stress.
That way, Whitman said, “both partners are equally responsible and have equal rights.”
For their part, Temple and her boyfriend also have a third roommate in their Denver rental. All three of them are on the lease of the 3-bedroom apartment, where they share rent according to square footage.
As uncomfortable as it sounds, you should also have a talk with your partner about what to do if the relationship ends, including who would stay in the residence, Whitman said: “It’s always better to have a plan,” she added.
Some couples who are first moving in together prepare a cohabitation agreement, in which they outline who gets what, such as the place itself and any furniture, if they go their own ways, experts said.
Just as cleaning the kitchen and vacuuming need to be done on a regular basis, so do certain financial tasks, Whitman said.
“Include financial management as one of the chores when making a list of who does what,” Whitman said. This includes making sure you’re sticking to a budget, getting the bills paid and tackling any debt.
Forgoing initial conversations around money “will expose you to risks down the line,” said certified financial planner Sophia Bera Daigle, founder of Gen Y Planning in Austin, Texas. You need to learn about each other’s spending patterns and debt, Daigle said.
Whitman also suggests regular chats about your financial goals, big and small.
“If one partner is interested in saving to purchase a home and the other would rather spend every penny on going out, count on a lot of friction,” Whitman said.
Couples might have “money dates” once a month to discuss their financial anxieties and aspirations, said Daigle, a member of the CNBC FA Council. “Continuing these conversations will help hold each other accountable,” she said. “Make it into a fun topic rather than a taboo.”
You shouldn’t expect your partner to be a mind reader, added Whitman.
“Share your views, ask questions, talk about what is and isn’t important,” Whitman said.
Knowing each other’s history is also important, she added. “If you have experienced food insecurity, share this with your partner.”
These discussions can help shed light on your financial behavior.
Couples who have just moved in together probably don’t want to rush into combining their finances, including accounts and assets, Whitman said. There is time for that.
For shared bills, you can have a small joint account, “with each partner contributing monthly,” she said.
For those who opt to keep things completely separate, they can pay rent and larger expenses from their individual accounts by writing two checks, or with one person sending half their costs to the other, who pays the bill directly.
Taking the step of cohabitating is a kind of test run to see if your relationship could stand the long haul, said Benjamin Seaman, a psychotherapist in New York. That’s why it’s important to try to do things right.
“Put your cards on the table, come to an understanding of where you are and where you want to be, and use this as a chance to learn about each other’s raw spots and strengths,” Seaman said.
Your quality of sleep can either set you up for greatness or negatively impact your mood, and the comfortability of your mattress plays a huge role.
“An old mattress or one that isn’t supportive for your sleep positioning can lead to more awakenings at night, trouble getting comfortable before bed and problems with stiffness during the day,” says Shelby Harris, a clinical psychologist and sleep specialist.
While the type of mattress you prefer can vary from person to person, it’s important for you to “invest in a good mattress that fits your sleep preferences,” Harris tells CNBC Make It.
And even when you’ve found the mattress of your dreams, you still need to change it every now and then to ensure that you’re getting the best quality sleep. Here’s when it may be time to toss “old faithful” and how much you should budget for a good-quality mattress.
When you should change your mattress mainly depends on the type of material the mattress is made of, says Harris.
Here’s how often she recommends changing your mattress based on its material:
Latex: 10 to 15 years
Memory foam: Lower-quality mattresses should be changed after around five years have passed. Better-quality ones can be switched out every eight to 10 years.
Innerspring: Five to 10 years
Hybrid: Seven to 10 years
But there are other reasons why you may need to change your mattress outside of the amount of years you’ve had it.
“Our bodies change as well. [We] gain weight, lose weight [or] have to sleep in a new position due to various reasons [like] pain, surgery, etc.” says Harris. “You want to see if your mattress is accommodating those changes.”
If you and your partner don’t have compatible mattress tastes, “you can always get two separate twin-XL mattresses that you each like, then put a mattress connector between them to essentially make a king bed with you both getting what you want in a mattress,” says Harris.
Mattresses can be quite expensive, especially if you’re purchasing other furniture for your home around the same time. Still, budgeting for a high-quality mattress is worth the investment, says Kerrie Kelly, an interior designer and former chair of the national board for the American Society of Interior Designers.
“When it comes to investing in a mattress, it’s wise to prioritize quality over the price tag. A mattress that aligns with your comfort preferences and provides proper support is invaluable, making it worth considering a budget that allows for a well-crafted option,” Kelly tells CNBC Make It.
As you’re budgeting for the furniture you’ll need for your home, she strongly suggests setting aside between $1,000 and $2,000 for a mattress.
For families with four or more members, she recommends allocating a budget of $800 to $1,500 for each person’s mattress.
Thankfully, there are methods you can use to help save money when buying a high-quality mattress, says Kelly.
Here are a few ways that you can get a great mattress on a budget:
Purchase your mattress from online retailers: “They often offer competitive prices and convenient shipping options,” Kelly notes.
Buy during seasonal sales or promotions
Pay for your mattress in a bundle deal with other furniture to get it a lower price point
“We spend about one-third of our lives indulging in the blissful embrace of sleep,” says Kelly, “so make sure your mattress can support you.”
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For many Americans, payday can’t come soon enough. As of June, 61% of adults are living paycheck to paycheck, according to a LendingClub report. In other words, they rely on those regular paychecks to meet essential living expenses, with little to no money left over.
Almost three-quarters, 72%, of Americans say they aren’t financially secure given their current financial standing, and more than a quarter said they will likely never be financially secure, according to a survey by Bankrate.
“There are actually millions of people struggling,” said Ida Rademacher, vice president at the Aspen Institute. “It’s not something that people want to talk about, but if you were in a place where your financial security feels superprecarious, you’re not alone.”
This struggle is nothing new. Principal Financial Group found in 2010 that 75% of workers were concerned about their financial futures. What’s more, since 1979, wages for the bottom 90% of earners had grown just 15%, compared with 138% for the top 1%, according to a 2015 Economic Policy Institute report. But there’s now a renewed focus on wage-earner anxiety amid higher inflation and rising interest rates.
The typical worker takes home $3,308 per month after taxes and benefits, based on the latest data from the U.S. Bureau of Labor Statistics. But when you take a look at the cost of some of the most essential expenses today, it’s easy to see why consumers feel strained.
The median monthly rent in the U.S. was $2,029 as of June, according to Redfin. That amount already accounts for about 61% of the median take-home pay.
Meanwhile, the Council for Community and Economic Research reported that the median mortgage payment for a 2,400–square-foot house was $1,957 per month during the first quarter of 2023, which accounts for about 59% of the median take-home pay.
“Inflation is really hurting individuals having stability in their housing,” said certified financial planner Kamila Elliott, co-founder and CEO of Collective Wealth Partners in Atlanta. She is a member of CNBC’s Financial Advisor Council. “If you have uncertainty in your housing, it causes uncertainty everywhere.”
Combine that with the average $690.75 Americans spend each month on food and out-of-pocket health expenditures that cost the average American $96.42 monthly, and you get a total expense of $2,816.17 for renters and $2,744.17 for homeowners.
That amount already accounts for just over 85% of the median take-home pay for average American renters and almost 83% for an average homeowner. This is excluding other essential expenses such as transportation, child care and debt payments.
“So much of managing your financial life in America today is like drinking from a firehose that many households are not able to show up and impose a framework of their own design onto their finances,” said Rademacher. “Many are still in this reactionary space where they’re just trying to figure out how to make ends meet.”
Watch the video to learn more about why financial security feels so impossible in the U.S. today.
MarketWatch Picks spoke to smart shopping and money saving experts to help arm you with the tools you need to get ready for school like a pro.
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To quote the great poet Taylor Alison Swift, “August slipped away into a moment in time.” Now that we’re midway through summer’s final month, it’s time to get ready to head back to school, if your kids haven’t already. Whether you’re sending little ones to school for the first time or getting young adults ready, your list is likely long and daunting — and with prices still affected by record inflation, searching for the best deal is no doubt important. MarketWatch Picks spoke to smart shopping and money saving experts to help arm you with the tools you need to get ready for school like a pro.
1. Trying to get it done all-in-one? Hit your favorite discount retailers
“Back to school sales are extremely prevalent right now, so it should be easy to track down savings from many of your favorite retailers. Target and Walmart are both big picks for consumers, as they’re great for checking off pretty much everything on most school supply lists,” says Julie Ramhold, consumer analyst with DealNews.com. “They also tend to be great options for parents who need to shop for uniforms, too, so if you don’t want to shop multiple stores, these are both definitely worth being your first picks,” Ramhold adds.
If you’re shopping primarily for basic supplies, you’re likely to spend a lot less browsing store brands than name brands or at other retailers, says money saving expert Andrea Woroch. “When it comes to basic supplies and clothing, you can save up to 50% by opting for store brands over name brands. For example, Target’s Up & Up 1-subject notebook costs just $0.99. Comparatively, the same type of notebook from Five Star costs $3.39. That’s a $2.40 price difference for just 1 item,” she says. “For clothing, you can get this girl’s polo uniform shirt from Walmart’s Wonder Nation for under $5. Meanwhile, a similar style from Land’s End will cost you nearly triple even when it’s on sale for $16,” Woroch says.
Certainly, if you have a membership at one of these retailers — like Walmart+ or Target Circle — that may help you decide where to shop if your loyalty is divided.
The MarketWatch Picks team has put together this guide to see if springing for a Walmart+ membership is right for you.
But don’t forget to compare prices between the two. “Don’t spend your time driving around to them to see how they stack up; instead, take the school supply list and add every item to your cart online at each store,” Ramhold says.
And don’t forget to check out even the off-brand discount stores if you’re looking to save on the basics, says Trae Bodge, smart shopping expert at TrueTrae.com. “For example, at Dollar General, you can find more than 100 back-to-school items from brands like Crayola, BIC, and Elmer’s, plus store brands like iMagine and Office Hub that offer a 100% satisfaction guarantee.
2. Got younger kids? Splurge on some items that will last
There is an exception to Woroch’s approach to opting for store brands over name brands: Items like backpacks and sneakers tend to hold up longer if they’re higher quality, giving you more bang for your buck. “For this reason, shop discount stores or at outlet centers to get name brands for less. I also suggest going with a backpack in a plain print or color so your child can use it for a few school years. Opting for a character style backpack could mean that your child outgrows it the following school year and you will have to replace it,” Woroch says.
3. Got older kids? Save by empowering them to shop on their own
Older kids have likely shopped for back to school with you a few times by now and may have their own ideas about what works best for them. Luckily for you, this can also serve as a smart budgeting tool. “For teens and tweens, I strongly recommend giving them a gift card to shop for themselves. They will be much more mindful of what they buy with “their” money vs. yours, and they’ll learn quickly about how pricey items can impact their budget,” Bodge says. “To make it fun, I like to give a personalized Visa or Mastercard with the Build-a-Card service from GiftCardGranny. You can upload a fun photo and personalized message and the cards ship within 1-2 days.”
You can also use cash back apps like Fetch to score gift cards, Woroch notes. “Just take pictures of all your school shopping receipts and upload them to the app to earn points which are good towards free gift cards to various stores that sell school supplies like Target, Amazon and Walmart which you can then use to offset additional school purchases either now or mid year when you need to restock your supplies!”
4. Stack your errands list if you’re strapped for time and look for free loyalty programs where you already shop (if you haven’t already)
Chances are you’ll have to hit the pharmacy sooner or later. “For example, if you need to pick up other things at CVS, you’ll find that they have a broad selection of healthy snacks for lunches as well as budget-friendly school supplies. Ifyou join their free ExtraCare program, you’ll save even more with access to sale prices and ongoing personalized offers online or in the CVS Pharmacy app,” Bodge says.
Ramhold notes that the CVS ExtraCare program also has a “Spend $40, get $10” program right now. “You could earn free money to use at CVS for purchases you’d buy anyway and then apply that free money towards additional school supplies so you can get items without spending more out of pocket,” Ramhold adds.
5. Take a beat to understand what you don’t need to buy as well as what you do – and don’t buy everything right now.
It’s definitely important to make sure that what you need isn’t just sitting under your nose. “Before you go shopping, take stock of what you have at home. This way, you’re not wasting money on supplies you already have at home! For example, you can tear out pages from half-used notebooks, reuse folders and binders, and put together a pack of crayons or markers from a scattered set. Lastly, toss that dirty backpack in the wash so it looks new again,” Woroch says.
Obviously buy whatever necessary supplies your child’s teacher recommends, but hold off on spending too much on clothing, Bodge suggests. “Reason being is that they will inevitably see a trend at school that they’d like to take part in, and fall clothing will start to go on sale in October,” Bodge says.
You can also save by swapping rather than buying, shopping second-hand, or collaborating with other local families. “Swapping is another way to avoid spending. Reach out to other families from your school or in your neighborhood to set up a clothing or supply swap,” Woroch says.
Both Bodge and Woroch note that if your family has a Sam’s Club or Costco membership, consider buying supplies and snacks in bulk or teaming up with another family – or even a whole classroom – for a supply run. “Have 1 parent buy all the supplies and divvy it up among families, then collect cash via Venmo/Paypal/Zelle,” Woroch says.
As for shopping secondhand, Bodge recommends considering retailers like ThredUp and Poshmark for clothing or purchasing refurbished tech from Best Buy to save on big ticket items. This can help you save significantly. “If your kids are like, “ew, used” show them how much further their budget will go when buying secondhand. Plus, no one besides you will ever know,” Bodge adds.
The travel website FloridaPanhandle.com analyzed costs in 100 popular vacation spots, looking into average prices for accommodations, transportation, food and attractions.
Here are 10 destinations that certainly call for big budgets.
According to the analysis, the most expensive vacation destinations, excluding flight costs, are:
Gustavia, St. Barts
Gstaad, Switzerland
Aspen, Colorado
Park City, Utah
Maui, Hawaii
London, England
Cocoa Island, Maldives
Maun, Botswana
Grand Cayman, Cayman Islands
Monte Carlo, Monaco
The 10 most expensive vacation destinations around the globe.
Source: CNBC
The list was dominated by islands and ritzy ski towns, though the draw of eco-tourism safaris in Botswana and Europe’s financial capital, London, rounded out the ranking.
The Caribbean island of St. Barts is the most expensive vacation destination in the world, largely because of its high accommodation costs, which average $1,770 per night, according to the analysis.
Average hotel rates in Switzerland’s Gstaad (No. 2) are $1,360, according to the research. The town in the Swiss Alps also has the highest average food costs on the list, at $177 per day.
Accommodations at the third priciest spot — Aspen, Colorado — average $1,385 for one person, but a family of four can expect to pay $2,274, according to the analysis.
A street in downtown Aspen, Colorado.
Nik Wheeler | Corbis Historical | Getty Images
To find those prices, FloridaPanhandle.com researched average rates for four- and five-star hotels for stays during Christmas (Dec. 21-27) and the spring (May 19-25), but did not include taxes.
To estimate the price of activities, FloridaPanhandle.com calculated the average cost for each location’s three most-reviewed attractions on TripAdvisor.
The ski town of Park City, Utah, averaged $333 for daily attractions — the highest on the list.
Attractions in Maun, Botswana, Africa’s lone destination on the list, averaged more than $100 per day for activities like a one-day visit to the Okavango Delta.
Despite having higher overall average costs, St. Barts and the Maldives’ attractions were valued at $0. Vacationers may have to pay top dollar for hotels in those locations, but their beaches are free.
Monaco, Monte Carlo.
Ostill | Istock | Getty Images
Monte Carlo had one of the lowest average rates for attractions on the list, a surprising result for a vibrant gambling hot spot.
While “Monte Carlo is known for its casinos, it is also not the most popular thing to do in town,” said a representative from FloridaPanhandle.com.
According to the company, the three most popular attractions in Monte Carlo are the Oceanographic Museum of Monaco, an outdoor area called Casino Square, and the Casino of Monte Carlo, which has an entrance fee of 18 euros ($20).
Gambling losses, however, are not included in Monte Carlo’s average attraction costs.
The goal of many (or most) savers and long-term investors is to achieve financial independence. The combination of building up a nest egg, paying down debt and eventually receiving Social Security payments or another source of retirement income might put you in a comfortable position, but even people who have worked together to achieve financial independence may disagree on what to do after their careers end.
Quentin Fottrell — the Moneyist — heard from one couple who are facing a quandary. They have been financially responsible, but as they near retirement, the wife wishes to be very careful with their combined investment portfolio, while the husband wants to begin spending a significant portion of it. They both make reasonable arguments. Here’s what they should do.
A behavioral study finds a correlation between having one specific type of conversation and taking action to build wealth.
Getty Images
Doing this even once might help encourage you or someone you know to begin saving and investing for the long term.
The ‘Magnificent Seven’ stocks may not remain at the top
Salesforce is among the companies passing a Goldman Sachs screen for growth of sales and earnings.
Getty Images
Even an index that includes hundreds of stocks can be heavily concentrated. Large technology-oriented companies have led this year’s 16% rebound for the S&P 500 SPX, -0.29%,
following last year’s 18% decline (both with dividends reinvested). But the index is weighted by market capitalization, which means the “Magnificent Seven” — Apple Inc. AAPL, -0.59%,
Microsoft Corp. MSFT, -1.19%,
two common share classes of Alphabet Inc. GOOGL, -0.52%
In the Need to Know column, Barbara Kollmeyer lists companies that might turn out to be among the next Magnificent Seven, based on a Goldman Sachs screen.
Getting back to the current Magnificent Seven, you may be surprised to see which of the stocks is cheapest — by far — per one commonly used valuation metric.
Meta’s Threads app has signed up as many as 50 million users in its first two days of operation, some reports say.
AFP via Getty Images
Meta rolled out its new Threads service on Wednesday to compete directly with Twitter and has already signed up 50 million users, according to some reports.
U.S. shoppers have been taking it slow during a period of high inflation, but the overall economy has been stronger than expected even as the Federal Reserve continues tightening its monetary policy.
Lukas I. Alpert writes the Financial Crime column. Have you ever wondered how you might steal a lot of cash from a company that is likely to have rather tight accounting controls in place? This week Alpert explains how the manager of an Amazon warehouse managed to scale the heights of criminal achievement to collect $10 million — and a 16-year jail sentence.
A record 43.2 million people are expected to travel by car this July 4 holiday, according to AAA, the motoring and leisure travel membership organization.
Though gas prices are currently still high compared to historical averages, drivers have no plans to cut back on road travel, according to AAA.
That’s as this summer is proving to be a particularly popular travel time. The busier season has not been without complications, including mass flight disruptions leading into the July 4 holiday.
“People want to go somewhere, they want to do something,” said Ted Rossman, senior industry analyst at Bankrate and CreditCards.com. “There’s still a lot of pent-up demand that backed up during the pandemic.”
That demand has helped push categories like airfares and hotels higher this year, Rossman noted.
Opting to drive instead of fly was one of the more common changes, according to Rossman, in addition to choosing cheaper accommodations or destinations and traveling for fewer days.
Travelers who are hitting the road by car or other vehicle may also look for ways to cut costs on gas.
Those hitting the road this weekend may want to fill up if they’re passing through the least expensive markets, according to AAA’s recent ranking of the top 10 least expensive markets.
That includes Mississippi, with prices around $2.97 per gallon; Louisiana, $3.08; Alabama, $3.10; Tennessee, $3.10; Arkansas, $3.11; South Carolina, $3.17; Texas, $3.18; Oklahoma, $3.22; Georgia, $3.23; and North Carolina, $3.25.
Drivers everywhere may save by using apps to help them find better gas prices, such as Upside or GasBuddy, according to Rossman.
Some credit cards may give you up to 5% cash back on gas, according to Rossman. That includes brands such as Chase Freedom Flex and Discover it Cash Back, he said, which are offering that rate between July and September.
Sam’s Club also offers certain cards that will allow consumers to earn money back on gas.
It is also worthwhile to check the perks your existing credit cards may offer, Rossman said.
“You may have a good gas rewards credit card and not even realize it,” Rossman said.
Of note, it is generally best to avoid gas-branded cards, which may come with high 30% annual interest rates and limited discounts on gas purchases, he said.
Drivers should also look to stack offers where they can. For example, a credit card may offer 5% cash back on gas, and a gas station app may provide a 10% offer per gallon, Rossman said.
“That’s two ways to save instead of one,” he said.
Rental cars are also comparatively cheaper this year, Rossman said.
If you’re thinking of renting a car, be sure to double-check whether your credit card may already offer insurance coverage.
“A lot of times, credit cards have various travel perks built in that people may not even realize they have,” Rossman said, which may also include provisions for trip delays or cancellations as well as lost or delayed luggage.
That has led more home purchasers to opt for one strategy, purchasing mortgage points, as a way to defray higher monthly payments.
Mortgage points let buyers pay an upfront fee to lower the interest rate on their loans. In some cases, sellers will help to buy down rates to help ease transaction costs.
Almost 45% of conventional primary home borrowers bought mortgage points in 2022 to reduce their monthly mortgage payments, a trend that has continued into this year, according to recent research from Zillow.
That is up from 29.6% in 2021, when interest rates were lower.
The 30-year fixed-rate mortgage currently averages 6.7% according to Freddie Mac, up from 5.8% a year ago. The 15-year fixed-rate mortgage now averages about 6%, up from 4.8% a year ago.
This week, the Federal Reserve decided to pause the interest rate hikes it has put in place to combat high inflation.
As rates stay higher, those who are in the market for a home lose purchasing power. Some experts have urged buyers to consider purchasing mortgage points to lower their monthly payments.
Stephanie Grubbs, a licensed real estate agent at the Zweben team at Douglas Elliman Real Estate in New York, recently did exactly that when one of her clients lowered their asking price.
“This fabulous apartment just had a price reduction, which means you can use those savings to buy down your rate,” Grubbs wrote in the updated ad.
Grubbs, a former financial advisor, said her firm started bringing up the strategy more when the Fed started hiking interest rates.
“In an effort to try to be creative, we talk to sellers about offering to buy down a rate,” Grubbs said.
Other experts say buyers purchasing mortgage points can be a great strategy for the right situation.
That goes particularly if a buyer can afford the extra upfront costs.
Being able to lower that monthly payment can really help give some more wiggle room in people’s budgets and help them reach affordability.
Nicole Bachaud
senior economist at Zillow
Mortgage points refer to the percentage amount of the loan. Typically, one point is worth 1% of the loan value, according to Nicole Bachaud, senior economist at Zillow.
If the loan value is $300,000, one point would typically cost $3,000 and lower the interest rate 0.25 percentage points, she said.
“Being able to lower that monthly payment can really help give some more wiggle room in people’s budgets and help them reach affordability,” Bachaud said.
In addition to higher upfront costs, home buyers should also weigh other factors before buying mortgage points.
“For most instances, it is definitely a considerable cost savings to be able to buy down on points,” said Kamila Elliott, a certified financial planner and co-founder and CEO of Collective Wealth Partners, a boutique advisory firm in Atlanta. Elliott is also a member of the CNBC Financial Advisor Council.
However, if you buy points and then refinance, that will not allow enough time for your upfront payment to appreciate, Elliott said.
Another important consideration is your timeline for how long you plan to live in the home.
With rates and home prices high, that means closing costs are also elevated, Elliott said.
Consequently, if you move before three to five years, you may take a bigger financial hit, she said.
“There could be a huge loss if you can’t stay in that property long enough to have those expenses amortized out over the time that you’re there,” Elliott said.
If you have extra money when buying a home, you may instead choose to increase the size of your down payment.
This can be advantageous because it creates more equity in the home, Bachaud noted. It may also lower your monthly payments.
If that extra money is enough to bring your down payment to 20% of the home purchase price, that would eliminate the need for private mortgage insurance, which adds to monthly costs for mortgage borrowers who put down less than those sums.
However, you may see more of an effect on your monthly expenses by buying points rather than increasing your down payment, Elliott said.
It costs less for a seller to buy down somebody’s mortgage than it does for them to take a price reduction.
Stephanie Grubbs
licensed real estate agent at Douglas Elliman Real Estate
A point may cost $3,000 to $4,000, for example. But putting those sums toward a down payment likely will not make much of a difference on your monthly costs, Elliott said.
If you want to make sure your mortgage payment doesn’t exceed one-third of your take home income, then paying down on points could be the better option, she said.
In some situations, a seller may offer to buy down the rate, a concession to help offset costs for buyers. Grubbs said she has discussed employing this strategy with clients in her real estate practice.
“It costs less for a seller to buy down somebody’s mortgage than it does for them to take a price reduction,” Grubbs said.
Homebuyers may want to consider pursuing a 2-1 buydown, a mortgage that provides a low interest rate for the first year, a slightly higher rate in the second year and a full rate for the following years.
A 2-1 buydown may also sometimes be seller financed, according to Bachaud.
Talking to a loan officer can help you decide the best decision for your situation, Bachaud said.
How well any homebuying strategy fares in the long run depends on one big unknown: how the Federal Reserve will handle interest rates going forward.
The latest projections from the central bank call for two more rate hikes this year.
While today’s rates feel high, Elliott said she often reminds people that homebuyers in the 1980s would have loved to have had access to 6% mortgage rates.
Inflation in the U.S. has slowed from a 40-year peak of 9% last year, but prices are still rising rapidly and putting great stress on household budgets.
Topping the list is rent — the single biggest expense for people who don’t own homes. Putting food on the table, caring for young children and owning a car have also become a lot more expensive.
See the accompanying table to view where inflation is hurting Americans the most.
The cost of groceries isn’t rising as fast as it was last year, but putting food on the table is much more expensive now compared to a few years ago.
frederic j. brown/AFP/Getty Images
The latest consumer price index, due Tuesday, is likely to show a further slowdown in inflation. Yet the cost of many goods and services remains stubbornly high and isn’t coming down as fast as the Federal Reserve would like.
The Fed will meet Wednesday to weigh whether to raise interest rates for the 11th straight time since the spring of 2022. Wall Street widely expects the central bank will pause or skip a rate hike this month to see how much its prior increases are cooling off the economy.
The rate of inflation, based on the CPI, has decelerated to a yearly pace of 4.9% as of April.
The core rate that excludes food and energy has tapered off to 5.5% yearly pace from a peak of 6.6% last fall.
The bad news for the Fed is that core inflation, viewed as a more accurate predictor of future inflation trends, has gotten stuck at an uncomfortably high level.
The core rate has been flat at 5.5% to 5.6% since the start of the year, leaving it well above the central bank’s long-run target of 2% inflation.
The numbers: The final reading of a consumer-sentiment survey in May rebounded slightly to 59.2, but Americans remained worried about the future of the economy, especially against the backdrop of another fight in Washington over the debt ceiling.
The index, produced by the University of Michigan, registered a six-month low of 57.7 earlier in May. The index sank from 62 in April.
The consumer-sentiment survey reveals how consumers feel about their own finances as well as the broader economy.
Americans are worried about the possibility of recession and threat posed by a stalemate in talks between Democrats and Republicans on raising the U.S. debt limit. A similar impasse in 2011 also hurt consumer sentiment.
Sentiment is far below a recent peak of 88.3 in 2021 and a prepandemic high of 101. The index dropped to an all-time low of 50 last summer.
Key details: A gauge that measures what consumers think about the current state of the economy edged up to 64.9 from an initial 64.5 in May.
A measure that asks about expectations for the next six months also partly recovered to 55.4 from a preliminary 53.4 in May.
Both indexes are still quite low, however.
Inflation expectations haven’t changed much. Americans also think inflation will average just above 3% annually in the next five years.
Big picture: Higher borrowing costs have depressed purchases of houses and many other big-ticket items and put the brakes on U.S. growth. Yet even though the economy is more fragile now, there’s still no sign of a pending recession.
Market reaction: The Dow Jones Industrial Average DJIA, +1.00%
and S&P 500 SPX, +1.30%
rose in Friday trades.
Opinions expressed by Entrepreneur contributors are their own.
Are you looking to improve your financial portfolio but don’t know where to begin? Have you been dreaming of establishing greater financial freedom but aren’t sure what steps to take to get there? Budgeting and managing finances can be intimidating — especially when trying something new.
Leveraging these strategies can help set realistic expenditures while keeping track of investments to reach your financial goals faster.
Establishing realistic financial goals and expectations
You need to establish clear and achievable financial goals to achieve financial freedom. It involves setting short-term and long-term objectives aligning with your financial plan. Your goals should be realistic and attainable, which means they should be specific, measurable, achievable, relevant and time-bound (SMART).
For example, one short-term goal might be to pay off credit card debt within a year, while a long-term goal could be to save for retirement in 20 years. By setting clear financial goals, you can track your progress, stay motivated, and make informed financial decisions, ultimately leading to greater financial freedom.
In addition to establishing financial goals, setting realistic expectations for success is important. It involves acknowledging that financial success takes time and effort. Remember, setbacks and challenges are to be expected along the way.
To set realistic expectations, you should create a comprehensive budget that outlines your income, expenses, and savings goals. It will help you live within your means, avoid overspending, and prioritize your financial goals. You should also regularly review your progress and adjust your budget and financial plan.
Creating a budget to track expenditures and investments
Creating a budget is the key to successful budget management and expansions. It allows you to track your expenses, set financial goals, and make informed choices about how to use your money. When creating a budget, it’s important to factor in fixed (e.g., rent) and variable (e.g., entertainment) costs. You should also include debt payments, such as student loans or credit cards.
Once you have tracked your expenses and established financial goals, it’s time to create an investment plan that works for you. It could involve setting aside money regularly into a savings account or investing in stocks or mutual funds with higher potential returns but more risk involved.
Budget management: leveraging strategies for growth and expansion
In addition to setting financial goals and creating a budget, there are other strategies you can leverage for growth and expansion. One effective strategy is to diversify your investments. Investing in a variety of assets, such as stocks, real estate, and bonds, may reduce risk while possibly increasing rewards.
Another strategy is to maximize your income streams. It could involve taking on a side hustle, freelancing gig, or negotiating a higher salary at your current job. By increasing your income, you can allocate more funds towards your financial goals and accelerate your progress towards achieving financial freedom.
Furthermore, continually educating yourself about personal finance and investing is important. It could involve reading books and articles, attending workshops and seminars, or working with a financial advisor. By staying informed and up-to-date, you can make informed decisions about your money and investments and take advantage of new opportunities.
Finally, staying disciplined and committed to your financial plan is crucial. It involves sticking to your budget, regularly reviewing your progress, and adjusting as needed. It also means avoiding impulsive purchases and maintaining a long-term perspective on your financial goals.
Analyzing spending habits to make informed decisions about money
The first step in budgeting and expanding your finances is to analyze your spending habits. It means tracking your expenses, identifying necessary costs and areas of potential savings, and understanding how you are currently using your money.
Once you have done this analysis, you can decide which expenses to cut back on or increase to achieve your financial goals. For example, if you spend a lot on dining out or entertainment, you might want to reduce these expenditures to save more toward retirement.
Creating a budget that works for you is essential to financial success. It helps you track your expenses and understand where your money is going so that you can make informed decisions about how to use it most effectively. It also allows you to set and achieve financial goals to build wealth and reach your dreams.
Budget management: developing a plan of action for achieving financial freedom
Once you have identified your financial goals and created a budget to track expenditures and investments, it’s time to develop an action plan. It involves setting short-term and long-term goals and taking concrete steps towards achieving them. It also means consistently following through on the actions you set in place so that you stay motivated and committed to your financial plan.
You should also regularly review your progress and adjust your budget and financial plan. Pay attention to changes in the market or economic conditions that may affect your investments or income streams, as well as any modifications to laws or regulations that could impact your finances.
Utilizing tools for monitoring progress toward your desired outcome
Utilizing tools such as budgeting apps or online banking services will make it easier to track expenses and investments. This information can help you analyze spending patterns and identify areas of potential savings.
You should also assess your debt load and develop strategies for reducing it. Paying off high-interest debt is a great way to free up more funds for investing in other areas of your finances.
Finally, consider using rewards programs or discounts for purchases to maximize savings. These offers can add up quickly, allowing you to spend more money toward achieving your desired outcome.
Staying motivated and celebrating successes along the way
Finally, staying motivated and committed to your financial plan is important. Celebrate the small successes along the way, such as paying off a loan or reaching a milestone in your investments. Acknowledging these achievements will help you stay focused on achieving your long-term goals.
By following these steps and continuing to educate yourself about personal finance, budgeting, and investing, you can take control of your finances and get closer to achieving financial freedom. With discipline and dedication, you can reach your desired outcome.
Americans started the 2020s with a personal savings boom. The trillions in excess personal savings built up in the pandemic are beginning to vanish amid high inflation, according to Federal Reserve economists. The annual savings rate fell to a 15-year low in 2022. It started a recovery in 2023, but remains well below long-term trends. Despite this slowdown in saving, consumer spending has remained robust, keeping the U.S. from recession.
Budgeting, in theory, has never been easier in the digital age with countless apps and templates to help users manage their savings. However, a new method entirely void of technology is garnering traction after a Texas woman documented a budgeting practice called “cash stuffing” to pay off thousands of dollars in debt.
Jasmine Taylor, 31, was drowning in nearly $80,000 in debt in January 2021, per USA TODAY. She tried countless budgeting techniques and nothing seemed to work.
Then Taylor stumbled upon “cash stuffing” on YouTube, which involves taking cash out for designated spending purposes and putting it in envelopes, and the analog practice has helped her get out of debt in two years.
By 2022, Taylor had paid off all of her debt while amassing a TikTok following along the way. Now, Taylor has turned the practice that transformed her own budgeting into a full-time business called Baddies & Budgets which functions as a blog as well as selling different merchandise to assist in cash stuffing such as binders, wallets, and savings challenges.
“I could hand you a $100 bill now and a debit card with $100. I guarantee you it would be a lot easier to swipe that card than it would be to break the $100. We just have some type of connection with physical cash,” Taylor told the outlet.
If people put away $21 every week starting in January, they’ll have over $1,000 by Christmas, she added.
What is cash stuffing?
Cash stuffing is a budgeting practice wherein you withdraw cash at the beginning of the month (or whenever you receive a paycheck) and then place varying amounts in envelopes designated to specific categories. The idea is that it will prevent you from spending more than what you’ve allocated for that specific category.
How to get started ‘cash stuffing’
Before adopting a cash-stuffing approach to budgeting, review your spending habits as well as goals for savings. An easy way to gauge where money is spent (and wasted) is to print out the last two or three months of bank statements and highlight any spending habits that seem repetitive or careless.
After you’ve assessed your spending in relation to your financial goals, you can begin the envelope process. While you can customize your envelopes based on your specific budgeting needs, Taylor suggests breaking your cash stuffing into two categories:
Variable expenses for everyday needs and wants like groceries, leisure, gas, etc.
“Sinking funds” for insurance, holiday shopping, emergencies, etc.
The practice of putting away money for sinking funds every week allows for less stress when emergency strikes. Other envelopes can be used for savings or go towards paying off debt. Putting away $10 a week, for example, may not sound like a lot, but over time the money accrued will come in handy if you’re hit with a medical emergency or another financial burden.
Opinions expressed by Entrepreneur contributors are their own.
The fact is, the global growth profile of 2023 is showing a downward trend. According to the IMF forecast, this year the economy will grow only 2.7%, compared to 3.2% in 2022.
In fact, the projected data for advanced economies look even more discouraging, with the World Bank predicting 0.5% economic growth in the U.S. in 2023, which is almost 2% lower than the previous iterations. This leaves experts scratching their heads on whether we’re imminently running towards yet another big recession, or not just yet.
Team cuts are imminent, aren’t they?
Supposedly driven by the lingering downward economic spiral, thousands of businesses across various market verticals (mostly tech, media, finance and healthcare) announced huge staff cuts back in 2022, and this neverending firing streak continues.
However, is the global market slow-down actually the key factor, influencing the massive workforce cuts? While the need to cut spending may be the common ground, in a more nuanced context — not so much.
Namely, a lot of the companies in the tech sector, like Peloton or Zoom are facing overstaffing challenges, fueled by their exponential growth dynamics during the Covid-19 pandemic, which has turned out virtually impossible to sustain upon its decline.
Meanwhile, in the real sectors, like the automotive industry, some companies, like Jeep Cherokee explained their plant is idling amid rising electronic vehicle (EV) costs.
But most surprisingly, some commenters presume many companies are just “following the herd” in their market niche. In plain words, their assumption is, while the widely-predicted recession forces businesses to tie their belts in one way or another, laying off employees is just their go-to solution, which is seemingly working for their competitors. As business professor Jeffrey Pfeffer told Stanford News, “They are doing it because other companies are doing it.”
And the truth is, a massive workforce cut doesn’t actually save money in a short-term perspective (imagine the severance pay volumes), and can even flatten the business development in the case of mid-sized companies and small startups.
How to cut spending without laying off your team
In view of the tracked decline in economic activities, in some ways fueled by the lingering supply chain disruptions, and the sharp increase of inflation rates, cutting operational spending seems to be a reasonable idea. Not only can it remove extra pressure from business owners’ shoulders amid uncertain times, but also free up extra resources to fund the growth areas.
And, as mentioned above, letting go of your team members is hardly the best choice (in case you’re not overstaffed, of course), so it’s crucial that you eliminate the latter risks from the equation right away.
So, how do you determine that you’re overstaffed?
Essentially speaking, you need to analyze the average manager’s span of control in your company, or in plain words, how many people are reporting to each of them. This number can be different depending on the type of firm or industry. Anyway, the common ground is that if it’s lower than 5-6, the organizational structure most likely has too many levels, with the average optimum management-to-employee ratio currently ranging from 1:15 to 1:20(25).
Suppose, you don’t have apparent issues with the tall span of control, and the overstaffing risks are not your business case. Consider the following checklist for evaluating possibilities to lower the overall company’s spending without taking a toll on your business processes and cutting the team:
SaaS spending
Quite predictably, even small startups with limited funding usually use a bulk of paid SaaS solutions in their business routine (e.g. from a CRM and task management tools to a mere G Suite and accounting software).
And while the importance of such tools is hardly questionable, their actual selection, as well as the pricing, sometimes is. What I’m saying is that even though the high-quality product does cost money, negotiating a discount happens to be a far more rarely utilized option than one might imagine, which is a huge miss.
And if you’re paying for two similar management tools, with minor differences, perhaps, the use of a more advanced version of one of these instead will be actually cheaper, especially in the long run.
Office space rent
Even though the end of the acute period of the Covid-19 pandemic has stimulated many businesses to return to offices, chances are opting for a hybrid office may help reduce spending costs quite a lot.
Let’s do some quick math. Imagine you had 10 people in the office on a permanent basis, and consider rearranging the office space to a commonly-used area, which can fit 5 people at a time. This will cut the desk space in half, as well as reduce the required office space for the communal areas (like kitchens, breakout rooms and meeting rooms) by at least 20%.
Given that the average space per employee was estimated at 75 – 150 sq feet in the pre-pandemic times, as per JLL research (50% deskspace and 50% commonly used areas), the change of the office type from an offline to a hybrid one in the example herein can help to reduce the required office space by at least 200 sq feet.
In plain money, this could potentially save you around $7,000 monthly in office rent in Seattle, for instance.
While keeping your optimal team as is will definitely help streamline operational processes, you might consider limiting the hiring process for new employees, potentially needed for your newly-developed business projects.
That is, if you’re hoping to launch two new products in 2023, perhaps, a wise idea would be to select and prioritize the release of just one during a downturn, in order to spare financial resources. Another way to cut spending on human resources would be to readjust the rewards and recognition programs for employees, i.e. making them more tailored to particular business KPIs. In such a way you’ll be able to keep your team motivated, without overspending money on yearly bonuses across the board.
Ultimately, it’s up to each business owner to make their decision on how to prioritize spending and whether to cut their staff, or not during a downturn, but navigating a company amid uncertain times usually requires a strong team, so why risk losing it, having invested time and resources into building it? That is the question.
Are you looking to take your business to the next level? As an entrepreneur, it’s easy to get caught up in the excitement of rapid growth and explosive revenue. However, if you want your business to thrive in the long run, it’s essential to take a measured approach that prioritizes financial stability and sustainability.
We’ll be exploring this concept and much more in our upcoming free webinar, Smart Money: How to Strategically Scale Your Business and Achieve Sustainability, brought to you by Oracle NetSuite and Entrepreneur. Moderator Terry Rice will sit down with Jay Jung, an experienced corporate finance consultant with expertise in M&A, capital raising and growth strategy. He has more than two decades-worth of strategic finance experience and has a passion for creating effective revenue models, identifying challenges and opportunities, and more.
In this webinar, Rice and Jung will explore practical strategies for growing your business without sacrificing financial sanity or long-term success. Join us to learn how to take a reasonable, grounded approach to business growth that sets you up for lasting success.
Attendees of this webinar will learn:
The key elements of responsible financial planning and budgeting
How to build out the internal resources needed to manage a growing organization
Tools and processes to optimize your win rate and create a predictable sales cycle
The downside of growing quickly and how to build a sustainable business
Join us for the Smart Money: How to Strategically Scale Your Business and Achieve Sustainability webinar, taking place live on Thursday, April 27 at 12 p.m. ET | 9 a.m. PT.
