Plus: Understanding buy now, pay later options.

This Week In Your Finances: Jobs, Gas Costs, Wireless and The 4% Rule

Let’s be clear. There’s a hiring opportunity here. I’m seeking a social media assistant, ideally someone fresh out of college, but experience is also a plus. It’s a full-time role, preferably for someone local to Philly. Past employees have excelled at top firms like Forbes and NerdWallet. If you know someone interested, please send resumes to info@savinghunt.com. I’m eager to hear from you!

And I’m not alone in this. The economy added 531,000 jobs in October, surpassing expectations. However, that’s just a fraction of the 4.4 million who left their positions in September. With 10 million jobs still available, the situation feels mismatched. Will it lead to better wages and work-life balance? Only time will tell, but I’m looking forward to your responses!

Fuel Prices

Gas prices – a historical concern for presidents. Will they impact Biden too? According to NPR, gas prices are at their highest in seven years. You might have noticed this, especially if you filled up recently. I was astonished to see my small car cost $45 to fill up in New Jersey, known for its low gas prices!

Did I notice the extra 50 cents for milk? Or the dollar hike for bacon? Not really. But gas prices are unmistakable. They grab your attention as you watch the numbers rise. It’s like a game show where you’re on edge, waiting for the outcome.

Senator Chuck Schumer and several Senate Democrats are pushing Biden to tap into the Strategic Petroleum Reserve located in Texas and Louisiana. Energy Secretary Jennifer Granholm mentions there’s no certainty this will happen. So, what can you do?

Focus on what you can manage. If gas prices are out of your control, try reducing your driving. Combine errands, walk when possible, and consider public transport. And remember to cut unnecessary spending. Review your monthly bills too.

Consider Your Cellphone Bill

I read an article noting that a family of four can save over $900 annually by changing carriers. Finding unlimited data at a reasonable price is easier now. You just need to understand your data usage and required features — like 5G or mobile hotspot. If unlimited data isn’t necessary, there are even more affordable options. Pro tip: Setting up auto-pay and going paperless can save you $5 to $10 monthly per line, which adds up on family plans.

Should You Use BNPL?

This holiday, buy now, pay later (BNPL) services – which allow you to spread payments into interest-free installments over four to six weeks – are predicted to account for 3% of all purchases, up from 1.3% last year, according to Herb Weisbaum. This appeals to those on a bi-weekly paycheck cycle, offering a bit more financial flexibility.

However, it’s effective only if you stick to the plan. Seven out of ten users don’t, leading to late fees or interest, as a Lending Tree study explains. Understand potential late fees or interest rates if you miss a payment. And consider if a credit card might serve you better. If you pay it off monthly and earn rewards, it might be the preferable choice. Additionally, two-thirds of shoppers admit that this option encourages them to overspend. Just a thought.

Revisiting the 4% Rule

Lastly, let’s talk about the 4% rule, a long-standing strategy for retirement funds. A recent Morningstar report suggests reevaluating this approach. The advice now recommends withdrawing no more than 3.3% in your first retirement year and adjusting that amount for inflation in subsequent years. For instance, a $1 million portfolio would yield $33,000 in the first year. If inflation is 4%, your annual income would rise to $34,320 in the second year and $35,690 in the third, regardless of market conditions.

Why the shift? Because rapid market growth is expected to slow down. “It’s counterintuitive, but high stock valuations make retirement timing critical,” says Morningstar's Christine Benz, co-author of the report. The entire discussion offers additional strategies worth exploring.