Take Your Kid to Work Day is peculiar enough. If a co-worker brought a teddy bear to work, we don’t know what we’d do. Legend has it that the teddy bear was named after Teddy Roosevelt. If you’ve studied Teddy Roosevelt, you’d know he probably would’ve mocked anyone who did such a thing.
Monday brought us Gallup’s U.S. Consumer Spending Measure. This is the survey that asks, “How much money did you spend yesterday?” September’s average answer was $87, down considerably from August’s $94 and higher than September 2013’s $84. While this is a drop, this isn’t an uncommon trend for September and isn’t necessarily negative. September follows three months of summer vacations and the back-to-school shopping season. What may be negative is that this September was the second consecutive month the spending of upper income Americans dropped. How much did you spend yesterday?
Gallup’s U.S. Economic Confidence Index (ECI) started Tuesday with a mild improvement from August to September, -16 to -15 respectively. The drag on this index is the negative economic outlook of respondents. Then, the Bureau of Labor Statistics released its JOLTS (Job Openings and Labor Turnover Survey) report. This showed that there were 230,000 more job openings on the last day of August than on the last day of July. The hire rate was down. The separation rate, which includes quits, layoffs and discharges, remained unchanged. The industries that saw growth included nondurable manufacturing, healthcare and social assistance, and accommodation and food services. The Fed Reserve Board of Governors then released its Consumer Credit report for August. Consumer credit increased by $13.5 billion in August, after July’s $21.6 billion increase. Auto and student loan debt increased $13.7 billion and consumer credit card usage declined by $208 million. That’s the first time this category dropped in the last six months and we’re glad to see it.
The last bit of news worth covering was the FOMC Meeting Minutes that came on Wednesday. The Fed is committed to wrapping up its bond buying program and is debating how to deleverage government debt. As with the International Monetary Fund (IMF) the Fed is concerned with the slowing pace of global economic expansion. The IMF announced its cut of projected 2014 global economic expansion to 3.3 percent from 3.7 percent.
Continue to judiciously manage spending and funnel savings into savings and investments, as opposed to other spending. For investments, hold more cash than you normally would. The Fed wraps up QE3 this month, which is one of our three major concerns, and we’re heading into an election that looks volatile. Elections typically disrupt markets. Hold off on increasing equity positions until after the election. Our other two concerns remain jobs and wages. Nothing has changed with either that’s worth noting.
A recent survey suggested that about 1/3 of millennials trust their parents to teach them about money, but only about a half of millennials actually talk with their parents about money. About a quarter of millennials stress about money at least once a week. We, similar to Barry at MoneyWeHave, weren’t concerned with money when we were younger. In fact, we could afford more when we had no money than now when we do.
That said, we’re not sure millennials stressing about money is altogether bad. We don’t want people stressed. Would millennials use the words “think about” rather than “stress”? If that’s the case, consider us content.
For millennials who need the help, the best way to achieve financial security is to save. Every little bit counts. Here is what saving $40 a month can mean. The other way to achieve financial security is to invest appropriately. Quality investing requires a multi-pronged approach. One of those prongs should include a retirement plan. Here are eight tips to maximize your 401(k).
If you need help getting started with any financial plan or think you have too many questions for Mom and Dad, buy our top 10 best selling eBook #MoneyConcious Financial Planning Guide: 12 Steps to a Richer You. In it, we share a simple way to create a personalized financial plan.
That’s this week’s #MoneyConscious Mash Up. Come back every Saturday for our take on what you need to know to be #moneyconscious.