Why You Need to Stockpile Presents for Your Kids for the Holidays — or Any Occasion!

Why You Need to Stockpile Presents for Your Kids for the Holidays — or Any Occasion!

We have totes for everything — storing holiday decorations, keeping the umpteen feral cats in our neighborhood warm during cold winter nights, planting small varieties of tomatoes, etc.

It’s not quite as bad as my mason jar habit, but it’s getting there…

Then, one summer, we found an extremely value-priced Imaginext playset at a garage sale, and my love of totes jumped to a whole new level.

We made the $2 plunge and bought the toy for our son, but as “luck” would have it, he was being extremely contrary that day, so a new toy wasn’t in the cards for him. While we pondered where we could store this fairly sizeable and yet 99%-cheaper-than-new playset, my thoughts strayed to a large, grey tote we had in our attic.

So, with the toy safely stashed in our 150-year-old attic, away from prying hands and nosey toddlers, we decided we’d simply give it to our son for his next birthday, which was in a few months. As per routine, we went out the next weekend to garage sales and found a really cool toy guitar for our daughter. Again, it was, I think, a dollar, but we don’t like the habit of giving our kids presents for no reason, so up to the attic it went.

Thus, through the magic of simulated time travel and a knack for spotting good deals on gently used toys, the Future Present Tote was born.

But What About Buying New Toys?

When I was a kid, I’d always get a combination of hand-me-down toys and new toys for holidays and birthdays. (I also got socks and stuff, but I try to block out the more sadistic traits of my family and focus on the good.)

Whether the present was a brand new doll or a tea set from Goodwill, I never knew the difference because it was always new to ME. I mean, it’s possible my toys were judging each other on being shiny and new, like some Mean Girls/Toy Story crossover, but who was I to get involved?

As a parent, though, I totally understand why my mother or grandparents might have opted to give me secondhand stuff — toys are expensive.

Not only is the cost an issue, but new toys are…well…sorta wasteful, don’t you think? When you buy a used toy or doll, you cut down on package waste, and you might save an item that was otherwise destined for the landfill. You put money directly into the hand of an actual person rather than a huge corporation. And, if after their presents are opened, your child decides within a few months they no longer like Power Rangers, you are out like $10 instead of $100+.

The New Adventures of Old Toys

If you have older children, I can see why you might hesitate to give them “used” toys, but you’d be surprised what you can find at garage sales and online resale sites that are actually in really great shape! For example, when I worked at PBS, I went on a huge Bob Ross kick and ended up buying a Bob Ross paint set.

Once I realized that maybe I wasn’t so great at painting happy trees, I decided to sell it — nearly new and at a third of the cost! Something like that would make for a great gift for older kids.

On the other end of things, if your children are young enough, you can also “retire” certain toys to the future presents box when they get new ones. This frees up space, reduces clutter, and allows you to keep them interested in a lesser amount of junk well-loved toys and stuffed animals. Then, after a while, you can reintroduce the old toy and watch them regard it with renewed interest.

Fantastic Deals and Where to Find Them

Where to stock up on future presents is probably the most fun part of the whole experience, aside from the money you’ll save. We love spending a Saturday morning perusing garage sales during the summer — it’s a great way to score deals while also enjoying sunshine and exercise as a family! Typically, we find some decent things in the fall, but those first spring garage sales are where it’s at.

People are very eager to clear their house out after winter, and especially since Christmas’ excesses and new toys are somewhat still lingering, you can get some really cool stuff dirt cheap.

Another opportunity is Facebook’s Marketplace feature. As your kids’ birthdays approach, run a few casual searches on their favorite things, and you’ll be surprised at what you can find. We picked up a Doc McStuffins playset for my daughter for $1 that would normally go for $30, were it brand new. It’s in pristine condition, not missing anything, and the family was happy to get rid of it as their children had grown out of it.

Granted, it’s a bit bigger than the tote, but the concept still holds true — she got it for Christmas and ADORES it.

Give Totes a Chance

This isn’t the first nor last time I’ll wax poetically about the usefulness of totes, so you might as well get on board. Pick up a tote and pick a hiding spot because this method of saving money is a keeper.

The only downside, of course, is that if you don’t hide it well, and I mean really well, it’s like a time capsule treasure chest for sneaky little hands. Aside from that, though, get yourself a future presents tote and start saving money for your future in the present.

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The post Why You Need to Stockpile Presents for Your Kids for the Holidays — or Any Occasion! first appeared on Thrifty Guardian.

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How Rising Inflation and Energy Costs Impact Your Household Budget

How Rising Inflation and Energy Costs Impact Your Household Budget

The rise in U.S. inflation, mainly due to surging energy prices, has a direct impact on everyday Americans. As energy costs increase, so do expenses at the gas pump and potentially utility bills. While wage growth offers promise, it’s offset by rising living costs, leaving disposable income stagnant. Uncertain interest rate cuts mean borrowing for mortgages, car loans, and credit cards may remain costly.

CPI Numbers Paint a Concerning Picture

Recent data from the Consumer Price Index (CPI) reveals an inflationary uptrend, with the CPI rate for the 12 months leading up to August jumping to 3.7%.

This figure overshoots the Federal Reserve’s preferred two percent benchmark. Aided largely by a significant hike in energy costs, the current inflation status potentially puts a pause on the anticipated central bank interest rate reduction.

Nathaniel Casey, a seasoned investment strategist at Evelyn Partners, emphasized that the consistent growth of the US economy may signal more interest rate hikes from the Federal Reserve.

The U.S. Economy’s New Challenge

While the Federal Reserve’s interest rate cuts seem unlikely, it’s essential to understand the broader implications of these economic shifts on the average American household.

The current inflation trend, dominated by rising energy prices, paints a mixed picture for the U.S. economy. On the one hand, there’s economic growth and wage hikes, but the tangible effects of inflation could squeeze the average household budget.

A Glimpse into the Everyday American’s Pocket

For the average American, inflation isn’t just a statistic; it’s a tangible shift in their daily purchasing power. A rise in energy prices means higher costs at the gas pump and potentially increased utility bills.

While wage growth may seem like a boon, it can be offset by the rising costs of goods and services, leaving net disposable income almost unchanged.

With interest rate cuts seeming distant, borrowing costs for mortgages, car loans, and credit cards might remain high.

The Driving Force: Energy

The hike in energy prices is the key factor driving this upward inflation trend. Energy inflation spiked to 5.6% due to higher crude oil prices, causing gasoline prices to rise significantly in August.

Gasoline prices played a big role, contributing to more than half of the overall monthly inflation increase.

But it’s Not Just Energy. While energy prices play a predominant role in the overall inflation picture, they aren’t the sole contributors. Core inflation, which doesn’t include energy and food costs, dropped to 4.3% in August from the previous month’s 4.7%.

This suggests that while energy costs are an undeniable influence, other sectors remain relatively stable. Another inflation influencer is the sustained wage growth, with average hourly earnings in August mirroring core inflation at an increase of 4.3%.

Awaiting FOMC Decisions

Casey states that even though recent data shows lower inflation and a calmer job market, the FOMC (Federal Open Market Committee) might still opt to keep higher interest rates for a while. The FOMC’s decisions will shape the short-term financial landscape for everyday Americans.

Any decisions related to interest rates will be revealed at the FOMC meeting on September 19-20.

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The Domino Debt Effect: Crippling Student Loans Are Impacting Family Life and Long-Term Financial Freedom

The Domino Debt Effect: Crippling Student Loans Are Impacting Family Life and Long-Term Financial Freedom

The American dream, once painted with the promise of education and prosperity, is being overshadowed by a looming cloud of student loan debt. 

This financial burden is not only altering the course of individual lives but is also reshaping family dynamics and the pursuit of financial independence. 

The rise in student loan debt is a pressing issue that has permeated American households. It is affecting decisions on financial security, major life milestones, and even health and well-being.

A Growing Problem

The student loan crisis in the United States has reached an alarming level. According to its latest data, the Federal Reserve estimates that total student loan debt now exceeds $1.7 trillion. For individual students, the average federal debt currently stands at $37,338. This figure surges to $54,921 per borrower for private student loan debt based on a 2023 report from the Education Data Initiative

Shockingly, student loan debt currently burdens more than 45 million students. That equates to one in every seven Americans. Even less if you only count the adult population. 

Far from being a short-term burden, half of student borrowers are still saddled with a $20,000 loan balance two decades after beginning their education. 

The growth rate of student loan debt is equally alarming. Over the last 15 years, figures from Federal Student Aid show that the total debt has tripled from $577 billion in 2008. At the same time, the average debt per student has almost doubled from $19,300. 

This rapid increase has far outpaced the growth of the average American wage, which rose a mere 35% over the same period. It is little wonder that the issue is putting an immense financial strain on millions of individuals, families, and retirees alike. 

Pervasive Impacts 

Student loan debt has wide-reaching adverse effects on many aspects of graduates’ lives once they leave higher education. A review undertaken by The Centre for Global Higher Education, which analyzed research over several decades, found that loans can impact everything from career choices, home ownership, health, retirement, and even starting a family. 

Those with higher amounts of student debt are less likely to start businesses, and career paths become restricted, ultimately leading to lower job satisfaction. While the research failed to find a consensus on the impacts on one’s earnings, student debt is forcing many to delay significant life events such as buying a home, getting married, and having children.  

Individuals burdened by educational loans generally possess reduced net worth, face heightened financial hardship, and have diminished savings. There are also impacts on retirement accounts and pension plans, particularly if students did not complete their degree. 

Perhaps most concerning is that the crisis is having broader ramifications on health and well-being, both during and after leaving university. The emotional aspects of student loan debt are profound and far-reaching. Anxiety, depression, insomnia, and panic attacks are common among those grappling with the weight of repayments. 

Parents are also stepping up to help their children with student loan payments in various ways. They are setting up automatic payments, taking on loans with high-interest rates, and even co-signing refinancing loans. This assistance comes at a cost. The repayment of student loans can consume a significant portion of a parent’s retirement savings. In addition, numerous studies also indicate that familial conflict may increase as parents continue to repay loans for their children’s higher education.

Seeking Solutions

In response to the growing crisis, the government has implemented several policies aimed at alleviating student loan commitments. The Biden administration has found ways to cancel more than $127 billion in debt through various federal forgiveness programs. These programs target specific categories of borrowers, such as public-sector workers, those with a total and permanent disability, or those impacted by historical inaccuracies. Additionally, over 1.3 million borrowers who were misled by their educational institutions, had their schools suddenly shut down, or fall under associated legal settlements also stand to benefit. 

Financial planning advice for families grappling with student loan debt is crucial. Experts recommend developing a plan to manage student loans as part of a long-term financial strategy. This plan should include understanding the amount owed, the terms of the loan contract, reviewing grace periods, and considering consolidating debt if it makes sense. Paying off loans with the highest interest rates first is another recommended strategy. These steps help individuals and families navigate the complexities of student loan debt and work toward financial independence.

Future Outlook

The future impact of student loan debt on families is a focus of ongoing research and concern. Predictions by the non-profit think tank Dēmos suggest that $1 trillion in unpaid student loans stands to erode $4 trillion of lifetime wealth for households in debt. This forecast means that the average student debt burden for a $53,000 bachelor’s degree leads to a lifetime wealth loss of nearly $208,000. Around two-thirds of this loss comes from lower retirement savings, while more than one-third comes from lower home equity. 

The Biden administration’s policy on forgiving federal student loan debt has eased the financial burden for many. However, the cost of such forgiveness programs is substantial and could cost up to $1 trillion over a 10-year budget window.

As America approaches a staggering $2 trillion total student loan debt, there is a profound impact on both individuals and families and the federal efforts to address it.

One thing remains clear. The long-term repercussions on financial independence, family dynamics, and overall well-being demand both immediate attention and sustainable solutions.

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Are Aging Americans Forced to Work Longer: Is 70 the New 65?

Are Aging Americans Forced to Work Longer: Is 70 the New 65?

The classic goal of ending your work life at 65 with financial peace of mind is slipping away. Previous generations looked forward to winding down in their mid-sixties. Now, a growing number of workers find themselves compelled to stay in the labor force longer than they ever anticipated. 

Mounting costs of living, dwindling savings, uncertain social security, and a volatile job market are forcing many to rethink their retirement plans. 

The situation does not just raise economic concerns; it sparks a deeper conversation about how Americans envision their golden years. This unsettling shift has vast implications not only for the aging workforce but for all generations to come. 

A Critical Lifeline

It would be remiss to underestimate the role of social security in safeguarding financial stability. For the vast majority of Americans, it serves as a fundamental income layer upon which to construct retirement plans. It also offers vital protection for disabled workers and families who lose their primary earners.

A growing trend among employers is to move away from traditional pensions that offer set benefits upon retirement. Instead, they are focusing on contribution-based plans like 401(k)s, which depend on how much workers invest and the returns those investments achieve. Consequently, for many, social security serves as the only guaranteed retirement income shielded from market risks and fluctuations.

Recent statistics from the Social Security Administration (SSA) indicate that nearly 67 million Americans will, on average, receive social security benefits in 2023. The sum of which throughout the year will be $1.4 trillion. It is estimated that 97% of older Americans either currently receive or will eventually qualify for benefits. Furthermore, for many beneficiaries, social security is their primary income source. SSA data reveals that close to half of retirees depend on social security for at least half of their income. For one in every seven retirees, this figure surges to 90%.

Social security also adjusts its benefits for inflation, unlike most private pensions or annuities. Without these adjustments, the Center on Budget and Policy Priorities estimates that nearly 40% of seniors 65 and older would fall below the poverty line. In other words, social security benefits elevate over 15 million older Americans above the threshold of poverty.

The Retirement Reality Shift

For the last four decades, the full retirement age for Americans has been gradually increasing from 65 to 67 years. Consequently, it is likely little surprise for anyone born after 1960 that their golden years might not quite begin at 65. What may come as a shock to some is just how geared current legislation is towards pushing workers to delay their retirement later into life. 

The SSA’s latest rules make it possible to retire as early as age 62, regardless of one’s full retirement age. However, there is a significant catch. Any worker who begins receiving benefits at age 62 or any time prior to their full retirement age of 67 may see a reduction in the amount received. This reduction can be as much as 30 percent. Conversely, thanks to delayed retirement credits, remaining in the workforce up to age 70 can result in higher benefits paid going forward.

In the face of rising living costs, many individuals find themselves working well into their retirement years. Research undertaken by the public policy think tank American Enterprise Institute notes that over the past 30 years, the average retirement age has increased by about three years, from 62 to 65. 

Financial, Physical, and Emotional Impacts

This trend is not just a personal choice but often a financial necessity driven by insufficient retirement savings, rising healthcare costs, and increased life expectancy. Estimates by the National Council on Aging reveal that a shocking eight out of ten households with seniors are either currently facing financial difficulties or are vulnerable to economic instability as they grow older.

Working involuntarily into one’s later years has been linked to a range of health issues. The National Library of Medicine conducted a systematic review exploring literature published over the last two decades on the health effects of employment in those over 64 years of age. While delaying retirement, particularly on a part-time basis, showed evidence of beneficial effects, this was primarily with men in low-demand jobs. 

On the contrary, those forced to continue working full-time for financial reasons, particularly in high-demand and low-reward jobs, were far more likely to experience adverse effects on physical and mental health. 

In addition, a need to work longer hours further compounds risks for older people. Data from the World Health Organization shows that deaths from stroke and heart disease as a result of working more than 55 hours per week have jumped 29% since 2000. The majority of these deaths are among those aged 60 to 79. 

Concerning Outlook

Current and future administrations have a major challenge ahead as Social Security and Medicare programs both continue to face significant financing issues. The latest annual report from the SSA Board of Trustees forecasts that the current form of scheduled benefits will only be fully payable until 2033. After that time, reserves of the Old-Age and Survivors Insurance Trust Fund will become depleted. Consequently, future estimates of income for the fund will only be sufficient to cover 77 percent of scheduled benefits.

Against this straining backdrop, there is renewed talk by the SSA of increasing the full retirement age to 70, which would effectively cut currently scheduled benefits by nearly 20 percent. 

A rising age for social security eligibility only compounds current issues for older people, forcing many to work longer. These cuts could be profound, and they would fall hardest on lower- and middle-income beneficiaries who rely most heavily on social security benefits.

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Household Budgets Attacked: America’s Economic Nightmare of Surging Inflation

Household Budgets Attacked: America’s Economic Nightmare of Surging Inflation

The rise in US inflation, mainly due to surging energy prices, has a direct impact on everyday Americans. As energy costs increase, so do expenses at the gas pump and potentially utility bills. While wage growth offers promise, it’s offset by rising living costs, leaving disposable income stagnant. Uncertain interest rate cuts mean borrowing for mortgages, car loans, and credit cards may remain costly.

The U.S. Economy’s New Challenge

Image Credit: Shutterstock / Cinemato

The U.S. inflation rate has surged in the latest data, fueled by escalating energy prices. 

While the Federal Reserve’s interest rate cuts seem unlikely, it’s essential to understand the broader implications of these economic shifts on the average American household.

A Dual-Faced Scenario

Image Credit: Shutterstock / Andrey_Popov

The current inflation trend, dominated by rising energy prices, paints a mixed picture for the U.S. economy. 

On the one hand, there’s economic growth and wage hikes, but the tangible effects of inflation could squeeze the average household budget. 

FOMC Will Shape the Financial Landscape

Image Credit: Shutterstock / dizain

The FOMC’s (Federal Open Market Committee) decisions will shape the short-term financial landscape for everyday Americans.

A Glimpse into the Everyday American’s Pocket

Image Credit: Shutterstock / perfectlab

For the average American, inflation isn’t just a statistic; it’s a tangible shift in their daily purchasing power.

A rise in energy prices means higher costs at the gas pump and potentially increased utility bills.

Wage Growth Vs. Rising Costs

Image Credit: Shutterstock / metamorworks

While wage growth may seem like a boon, it can be offset by the rising costs of goods and services, leaving net disposable income almost unchanged. 

Borrowing Costs Remain High

Image Credit: Shutterstock / Andrii Yalanskyi

With interest rate cuts seeming distant, borrowing costs for mortgages, car loans, and credit cards might remain high.

Breaking Down the CPI Data

Image Credit: Shutterstock / Wanan Wanan

Consumer Price Index (CPI) numbers paint a concerning picture. Recent data reveals an inflationary uptrend, with the CPI rate for the 12 months leading up to August jumping to 3.7%.

Rising Beyond Federal Benchmarks

Image Credit: Shutterstock / Pla2na

This figure overshoots the Federal Reserve’s preferred two percent benchmark. 

Aided largely by a significant hike in energy costs, the current inflation status potentially puts a pause on the anticipated central bank interest rate reduction.

The Main Culprit: Energy

Image Credit: Shutterstock / i am adventure

The hike in energy prices is the key factor driving this upward inflation trend.

Gasoline’s Significant Role

Image Credit: Shutterstock / H_Ko

Energy inflation spiked to 5.6% due to higher crude oil prices, causing gasoline prices to rise significantly in August.

Gasoline prices played a big role, contributing to more than half of the overall monthly inflation increase.

Looking Beyond the Obvious

Image Credit: Shutterstock / Roman Samborskyi

But it’s Not Just Energy. While energy prices play a predominant role in the overall inflation picture, they aren’t the sole contributors. 

Looking at core inflation, which doesn’t include energy and food costs, it dropped to 4.3% in August from the previous month’s 4.7%.

Other Contributing Factors

Image Credit: Shutterstock / Roman Samborskyi

This suggests that while energy costs are an undeniable influence, other sectors remain relatively stable. 

Another inflation influencer is the sustained wage growth, with average hourly earnings in August mirroring core inflation at an increase of 4.3%.

The Implications of Steady Economic Growth 

Image Credit: Shutterstock / fizkes

Nathaniel Casey, a seasoned investment strategist at Evelyn Partners, emphasized that the consistent growth of the US economy may signal more interest rate hikes from the Federal Reserve.

Awaiting FOMC Decisions

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He states that even though recent data shows lower inflation and a calmer job market, the FOMC might still opt to keep higher interest rates for a while.

Any decisions related to interest rates will be revealed at the FOMC meeting on September 19-20.

The post Household Budgets Attacked: America’s Economic Nightmare of Surging Inflation first appeared on Mama Say What?!.

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The Easiest Ways to Start a Christmas Savings Account

The Easiest Ways to Start a Christmas Savings Account

Starting a Christmas savings account almost feels outdated. Maybe it’s because I remember these Christmas savings opportunities being advertised nearly 40 (!!) years ago, but do they still work? That was the question on my mind as I explored ideas to save money for Christmas and looked into what banks actually still offer worthwhile Christmas savings clubs.

After a lot of reading and research, I’ve come up with an approach that will not only make starting a Christmas savings account effortless but also ensure a stress-free and joyous holiday season. No more worrying about finances when you should be focusing on the holidays – let’s dive in and discover the shocking secret that will transform your Christmas savings game.

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