Keeping up with the Joneses

Happy July! Here's your latest dose of useful insights and leads to improve your life.

You Should Know

• 40% of companies posted a fake job listing this year, according to a ResumeBuilder survey. Hiring managers say fake job postings improve employee morale and create the impression of company growth. ‘Ghost’ job postings often have vague descriptions and are more than a month old.

• The stock market is growing more concentrated. The seven largest companies (Apple, Amazon, Alphabet, Meta, Microsoft, Nvidia, and Tesla) now account for about a third of the S&P 500’s total value.

• Amazon Prime Day will be on July 16-17. Target Circle Week is July 7-13. Walmart Deals takes place July 8-11.

Are You Keeping Up With the Joneses? Here’s What That Really Means

"Keeping up with the Joneses" is a phrase we've all heard. (The phrase originates from a comic strip, by the way.) Broadly defined, it refers to the social pressure to match or exceed the lifestyle and possessions of your neighbors/peers. But what does the phrase really mean in quantifiable or financial terms?

We’re a curious bunch at Forthspark. We explored the different elements that constitute a "full lifestyle" in the USA and looked up the benchmarks you need to reach to keep up with the Joneses in today's world. Let’s take a closer look:

• Cars – the average American household owns 2.28 vehicles, and the average age of a car in the U.S. is a record high of 12.6 years. The Tesla Model Y is the best-selling luxury car model in the U.S.

• Vacations – the majority of Americans take 1-2 vacations per year, while a third take 2-3. 54% of Americans spend over $1,500 per vacation.

• iPhones – 87% of teens in the USA own an iPhone (parents clearly splurge on their kids when it comes to smartphones). Over 60% of Apple customers keep their iPhones two years or longer.

• Private school – one in ten students enrolled in pre-K through 12th grade attend private school.

• Retirement savings – the average retirement savings for all U.S. families is over $330,000. The median retirement savings for all families is approximately $90,000.

• Boats – one in ten U.S. households owns a recreational boat. The average ownership cost of a new boat is $5K-$8K per year.

• TVs – the average number of TVs in a U.S. home is 2.3, and the average age that a TV gets replaced is 6.6 years.

• Income – the median household income in the U.S. in 2022 was $74,580. The average household income is over $97,000, but high earners skew the average, so median income is a more fair measure of “average” wealth. The U.S. West has the highest median income - $82,390. The U.S. South has the lowest median income - $68,230.

• Debt – as of May 2024, the average U.S. household debt is $104,215, which includes mortgages, auto loans, student loans, and credit cards. Mortgages make up the biggest portion of household debt. The average American household has around $8,483 in credit card debt.

• Handbags – the average American woman owns 11 handbags.

• Gadgets – the average number of connected devices per US internet household is 17. A connected devices would include smart TVs, computers, security cameras, video game consoles, etc.

• Weddings – the national average cost of a wedding, including both the ceremony and the reception, is now over $35,000.

• Pets – the average number of pets owned by U.S. households is 1.46. 66% of households own a pet.

Sources: USA Today Blueprint, Experian Automotive, Park Associates, Pew Research Center, 2022 Survey of Consumer Finances, Nielsen, National Marine Manufacturers Association, NPD, U.S. Census Bureau, The Motley Fool, Wall St. Journal, Consumer Intelligence Research Partners, Piper Sandler, S&P Global Mobility, US News and World Report, The Knot, APPA National Pet Owners Survey

Of course, keeping up with Joneses should be balanced with realistic financial planning. The real measure of financial success isn't about appearances, but the security you enjoy from responsible money management.

Income Boosting Opportunities

• Did you know you can sell food on Etsy? They allow the sale of certain types of non-perishable or long shelf life foods. You must comply with all local, state, and federal laws regarding the production and sale of food. You can also sell food on Goldbelly, although you must go through a strict application process.

• Rare Patient Voice connects patients and caregivers with paid studies being conducted by pharmaceutical companies. There are hundreds of market research studies open for patients and caregivers. See the current list of studies and compensation here.

• 5 Surveys offers a simple proposition - complete 5 surveys and earn $5. You can cash out your balance anytime. Each survey takes 5-15 minutes to complete.

• Reklaim enables you to earn money from selling your data. Through their app, you can access your data, see how many companies are buying and selling your data, and how much your data is sold for annually.

Don’t Reach for that Retail Store Credit Card

Let’s not beat around the bush. Retail store credit cards are rip offs. There are nuances to the value of such cards, but largely speaking, we suggest you stay far away from these products.

Retail store credit cards typically lure you with a one-time discount on a store purchase or a low APR for an introductory period. Be warned – these benefits are easily outweighed by the drawbacks of using a store card.

Firstly, retail store credit cards are notorious for having sky-high interest rates. If you don’t pay off your balance in full each month, you will rack up interest charges. While your average credit card might hit you with a 15-20% APR, store card interest rates are significantly higher and downright abusive. For example, Michaels and Burlington credit cards have an APR of over 33%!

Another big problem is that a store credit card might hurt your credit score. Store cards often come with low limits, which can trick you into maxing them out. This skyrockets your credit utilization ratio, a key factor in your credit score calculation, and ultimately drags your score down.

The usability and rewards programs of store credit cards are also frustratingly limited. Oftentimes, store cards can only be used at specific retailers, restricting your purchasing flexibility, and “cash back” is often in the form of store credit. Traditional credit cards, however, are widely accepted and often come with versatile rewards programs, allowing you to earn points or cash back on a variety of purchases, from groceries to travel.

So go with the smarter financial choice. Stick with traditional credit cards.

Private Credit: How to Lend Money to Businesses for High Returns

If you want to make money by lending money to businesses, your options as "the little guy" are limited. When you buy a publicly offered bond, you are indeed loaning money to a business, but the yields are lower because bond issuers are typically larger (less risky) companies.

You can boost your yield by investing in private credit opportunities. With private credit, you're giving a business a private loan (compared to the general public buying a bond). Borrowers are typically small businesses and startups without access to the public markets. These loans are often backed by the borrowers' assets.

If this sounds interesting to you, check out Percent, an online platform that connects accredited investors with private credit deals, such as short-term loans, invoice financing, and merchant cash advances. The platform acts as the middleman. It vets borrowers, package the loans into investments, and handle the paperwork. This makes it easier for you to invest in private credit without the hassle of chasing down businesses yourself. Returns on private credit investments often range from 8% to 15%.

Higher returns are great, but remember, you're also taking on higher risks. Private credit isn't as regulated as the stock market, meaning there's less transparency and more potential for things to go south. Plus, these investments are typically less liquid, so your money might be tied up for longer periods compared to more liquid assets like stocks or ETFs.

Living Paycheck to Paycheck? Early Wage Access Explained

Millions of Americans live paycheck to paycheck, and even a surprise bill can wreak havoc on the family budget.

That’s where early wage access (EWA) services can be a lifesaver. Need to cover an unexpected expense without resorting to high-interest payday loans or credit card advances? EWA can be a solution to a cash crunch. These services allow employees to access a portion of their already earned wages, if needed, outside of a traditional pay cycle. EWA is also referred to as early pay, instant pay or on-demand pay.

There are two types of EWA services:

• Employer-sponsored programs: Many companies are starting to partner with EWA providers to offer this benefit to their employees. Examples include Wisely, Payactiv, and DailyPay.

• Direct-to-consumer EWA providers: These services allow you to sign up independently of your employer. Some well-known options include Rain, MoneyLion, and Earnin.

No surprise – these services often come with fees. There might be a subscription fee, a per-use transaction fee, or both. Even if they claim to be fee-free, there might inactivity fees or instant transfer fees or suggested “tips.”

Furthermore, the amount of money you can access early may be limited, so EWA likely won’t help you cover significant expenses.

Relying on early access can create a dangerous cycle. If you find yourself constantly needing to access your wages early to cover expenses, it's a sign your budget is stretched too thin. These services shouldn't be a substitute for proper budgeting and saving habits.