According to a survey by WalletHub, Valentine’s Day spending is expected to reach $25.8 billion in the U.S. this year, or about $185.81 per person choosing to celebrate the holiday.
Meanwhile, 46% of Americans say inflation is affecting their Valentine’s Day plans, and 24% don’t expect their valentine to spend any money on a gift this year. But another 45% expect their valentine to spend at least $50.
So what gives? Get more numbers.
Looking at the national economy, the Fed is ramping up to another 25 bps rate hike at their May meeting, but the job market isn’t feeling the recession burn. Unemployment sits at 3.5%, private payroll is on the rise, and 236K jobs were added in the past month. Meanwhile, interest rates remain unpredictable day to day.
ICYMI: In an ongoing quest to fight inflation, the Federal Reserve recently raised its benchmark rate by 0.25 points to 4.75%-5%. So what does that mean for the housing market? The primary impact is reduced demand as buyers think twice about taking out long-term loans. Ironically, less demand could lead to lower home prices.
The Skimm explores this conundrum.
From building equity to built-in savings, there are real estate principles and benefits to help your property pay you back, even in a down market.
Dual Purpose Investment
A home is both a current need and an investment in your future. You can find something that fits your family right now, but how will it suit you ten years down the road?
Valuable Savings
Mortgage payments can deliver equity, improve your credit score, and also serve as a savings account you can leverage now or tap later.
Tax Considerations
Like other life changes, homeownership comes with tax deductions, credits, and other perks. Ask your accountant to get you started with a mortgage payment deduction.
Protection from Inflation
Rents rise with inflation, and sometimes to pay for building upgrades, but payments on a 30-year fixed mortgage remain the same for, well, 30 years!
Want to learn more about the benefits of home ownership?
What we refer to as “inflation” is generally measured by the Consumer Price Index, a measure of average prices for basic necessities like gas, food, and housing. The CPI jumped more than 9% from June 2021 to June 2022, hitting a new 40-year high in the process.
So how can you keep inflation from affecting your wallet? The Skimm has a few tips.
