Latest news with #MelissaMurphyPavone
Yahoo
27-05-2025
- Business
- Yahoo
More Americans Track Their Budgets Than Their Diets — Here's Why It Still Feels So Stressful
According to a recent study from Secure Data Recovery, 56% of Americans spend an hour or more weekly tracking and analyzing their personal data. The average amount an American spends on data tracking tools is $108.36. With 59% of respondents monitoring spending and 49% tracking savings, the research also found that more respondents tracked their budgets than their diets. Regarding personal nutrition, 33% tracked sugar and 31% watched their calories. Read Next: Discover More: With 70% of Americans admitting to feeling anxious about tracking spending and 64% worried about their savings, it's worth pointing out that despite tracking budgets more than diets, many are still stressed out about their finances. Why are people still stressed about their budgets and finances despite such extensive tracking? 'Numbers alone don't solve money anxiety,' said Melissa Murphy Pavone, a certified financial planner (CFP) and founder of Mindful Financial Partners. 'I often see that tracking your finances is just the surface layer. The real work is peeling back the onion and understanding the emotions, habits and beliefs that drive your financial decisions.' She stressed that money is deeply personal, and we may carry unconscious money scripts around us. The harsh reality is that tracking your finances can sometimes feel like a spotlight on your shame instead of a tool for empowerment. When you closely monitor how much you're spending, you may discover uncomfortable realities about your relationship with money, which may feel daunting to tackle since you likely already have enough on your plate. Murphy Pavone emphasized that tracking your finances isn't just about control; it's about clarity. However, clarity will require courage, and you may have to face spending patterns that you've been avoiding for various reasons. Check Out: Aaron Razon, a personal finance expert at Couponsnake, believes that many people could be stressed out about tracking their budgets because of feelings of guilt over their spending. 'Tracking your finances is like using a scale to weigh your spending against your savings, and more often than not, the scale tips in favor of spending, and the difference can be very overwhelming, leading to feelings of guilt, frustration and anxiety,' he said. It's easy to be hard on yourself when you analyze your spending data and discover that you have many flaws. Similar to dieting, one may have the best intentions for how they're going to behave, but life can get in the way. Doing the right thing when managing finances isn't always about information, and you may find your spending patterns challenging to manage. Another reason tracking finances might feel stressful is that it can be overwhelming when you're constantly worrying about your spending, since you have to think about multiple accounts, bills and investments that could be dropping. 'The information overload, fear of missing payments or making an error, and the difficulty in staying organized combined, create a sense of financial unease, making it challenging to manage finances effectively,' Razon elaborated. When you get overwhelmed with all of your various financial accounts, the stress can creep in since you're worried about making the best decisions for your future. When you're constantly checking your retirement accounts, various credit card statements and spending, you could start to feel anxious about all of the information that you're trying to process. While you can automate certain aspects of tracking your spending and savings, paying attention to your personal data requires energy and focus. Michael Rodriguez, a CFP and owner of Equanimity Wealth, pointed out that tracking your spending isn't passive and could take up a decent amount of your attention. 'For someone already dealing with stress or burnout, it can feel like one more task you don't have the capacity for,' he added. For example, after a busy workday, the last thing you may want to do is input your spending for the day or review your savings because you have many other tasks to think about. If you're currently feeling stressed about your finances despite tracking everything, it could be a sign that the energy required is weighing heavily on you. If you're constantly comparing how much progress you're making in your financial journey with others, you may eventually feel like you're falling behind. Razon noted that tracking finances also becomes more stressful because individuals create an unfair and unrealistic benchmark for themselves when they compare their financial struggles and setbacks to others' seemingly perfect financial situations. 'When you look at a number that feels bigger than you expected — or that doesn't line up with your goals — it can trigger shame, not action,' remarked Rodriguez. 'Instead of feeling empowered, you feel stuck.' The dark side of tracking the numbers is that you may not like what you see, and it could feel like you're falling behind. With tangible proof of your financial struggles, you could feel like you're not keeping up, leading to feelings of stress and tension. When tracking personal data, it's important that you try to remember to do your best to use the numbers to make decisions about your daily actions instead of worrying about minor mistakes. It's foolish to aim for perfection when the goal should be progress. More From GOBankingRates 7 Things You'll Be Happy You Downsized in Retirement 4 Affordable Car Brands You Won't Regret Buying in 2025 This article originally appeared on More Americans Track Their Budgets Than Their Diets — Here's Why It Still Feels So Stressful
Yahoo
25-05-2025
- Business
- Yahoo
Saving Every Dollar for Retirement Is Just Silly — Why You Should Spend on Enjoying Life Now
Saving for retirement is important, of course, but saving every spare dollar for that purpose can actually create imbalance, 'especially when it starts to rob your present life of joy, meaning or opportunities for growth,' according to Melissa Murphy Pavone, a financial planner at Mindful Financial Planners. Read Next: Find Out: There are other considerations that should go into thinking about how you spend for the future and for today. Pavone and Robert R. Johnson, PhD, a certified financial advisor and professor of finance in the Heider College of Business at Creighton University, suggested you have to be flexible and strategic in approaching your spending. The big challenge for any person who has enough financial stability to both save for the future and spend leisurely in the present is how to balance that. Johnson pointed to the study of behavioral finance, which shows that 'human beings aren't rational profit maximizing machines but often succumb to behavioral biases.' One of the biggest behavioral biases, of course, is the bias toward immediate gratification over delayed gratification, he said. Because so many people tend to struggle to 'imagine their future self and give up that vacation or new car today in lieu of having money to retire on in the distant future,' most financial advice urges people toward doing the more diligent thing. However, Johnson pointed out 'the same can be true in reverse if one doesn't enjoy life in the present state and sacrifices current pleasures for future pleasures. The result can be mentally debilitating.' Be Aware: Pavone agreed. She has worked with people who are 'maxing out every retirement account but feel burnt out, disconnected from their families or frustrated because they're missing out on meaningful experiences.' Her advice is that, if you're always living in a 'someday' mindset, you might miss the very moments that make life rich. Pavone said it's best to strike a balance between 'living well today and being prepared for tomorrow.' That balancing act of 'honoring your past, investing in your future and living mindfully in the present,' is what most investors need to navigate. The goal of a thoughtful financial life isn't just to retire early, it's to live fully at every stage, Pavone said. 'That means aligning your investments, both financial and emotional, with what truly matters to you.' So long as you are financially stable, and have the luxury of extra dollars to spend, Pavone suggested you ask yourself the following questions. What do you value most right now? What brings you joy, purpose or peace? What are your biggest fears and are you trying to out-save them? The trick is determining how to tie available discretionary income to these questions without sacrificing future goals. Pavone uses a strategy she called 'financial modeling' to create 'permission' for intentional spending today without jeopardizing retirement security. 'Often, it's not a matter of either/or, it's about setting boundaries, creating margin and making sure the right dollars are going to the right places,' she suggested. This often looks like building in 'fun funds' or 'lifestyle reserves' into retirement models, so spending on joy is planned, not guilt-inducing. An area where spending now can pay big dividends later is on health and fitness, Johnson said. 'If one can improve their physical fitness, it can lead to better health in retirement and require less spending on healthcare in retirement,' he said. Additionally, though it might not seem as 'fun,' Johnson said that establishing a relationship with a qualified and credentialed financial advisor 'can be money well spent' because it helps you determine if you're on the right financial path. Living well today doesn't mean sacrificing your future, if you plan with intention. A balanced financial life makes space for both smart investing and meaningful spending. More From GOBankingRates These 10 Used Cars Will Last Longer Than an Average New Vehicle Sources Melissa Murphy Pavone, Mindful Financial Partners Robert R. Johnson, Creighton University This article originally appeared on Saving Every Dollar for Retirement Is Just Silly — Why You Should Spend on Enjoying Life Now
Yahoo
18-05-2025
- Business
- Yahoo
5 Ways To Become Financially Secure on a Middle-Class Salary
Defining financial class isn't just based on the income you make. If it was then, by the Pew Research Center's definition of 'middle class,' you'd be firmly in that category if you earn between two-thirds and twice the U.S. median household income (which is $80,610). That means you'd be considered middle class if you earn $53,740 to $161,220 a year. Read More: Find Out: But income is only part of the bigger picture. Here are some of the top ways to become financially secure on a middle-class salary in the U.S. Your salary is a good starting point to determine your financial well-being, but you need to consider the bigger picture. Things like household size, where you live and your other financial obligations also matter. 'A big misconception is that a six-figure salary automatically means financial security,' said Melissa Murphy Pavone, Founder at Mindful Financial Partners. 'I work with clients making $150K+ who feel like they're barely treading water, especially in high-cost areas like New York.' Imagine a family of four living on $161,220 in New York City. The average home costs about $796,000 there. Tack on other common expenses like childcare, credit cards or other debts, groceries, healthcare and transportation, and you're looking at a potentially tight budget. Now, imagine someone with no kids or debts living in Columbus, Ohio where homes cost an average of $253,000. Assuming they have solid budgeting skills and pay attention to their spending and savings, they could be doing quite well for themselves on that salary. High earners live paycheck-to-paycheck or struggle with debt all the time. Take a California couple who recently called in to the Dave Ramsey Show as an example. They earn about $300,000 a year and owe $119,000 in debt (not including their mortgage). They also spend roughly $5,000 a month on their housing payment and are struggling to lower their expenses and pay off what they owe. No matter how much you're earning, one of the best ways to become financially secure is to make a spending plan or budget. You can keep things simple. For instance, you could follow the 50-30-20 budgeting rule wherein your income goes into the following categories: 50% for needs 30% for wants 20% for savings or debt Or you can break down your spending into larger categories like: Mortgage or rent Utilities Transportation Gas Clothing Food Insurance / healthcare Debts Saving and investing Miscellaneous Whatever you do, find a budget that works for you. If you find yourself spending too much in certain categories, try to back off a little and put that money toward more important things. According to Experian, the average person carries $6,730 in credit card debt. That might not seem like much if you're earning twice the median income, have no other debt obligations and are keeping other costs reasonably low. But if you have that much credit card debt, chances are you've got a spending problem — or you haven't prioritized paying off your balances. And considering how high credit card interest rates are (nearly 23% on average), that just means you're spending more than you ought. If you want to become more financially secure, start by tackling those debts. You can always use the debt snowball method, which focuses on paying off the smallest balance first before moving on to the next-smallest balance and so on. Many financial experts suggest having at least three to six months' worth of expenses in an emergency fund. If you're self-employed or have kids, you might want to shoot for a higher amount. A lot of middle-class households don't have an emergency fund at all. What this means is that even the smallest financial hiccup — like a surprise medical bill — could be detrimental to their monthly budget. It could even mean taking on a new debt to cover that bill. 'Middle class isn't just about income, it's about lifestyle sustainability. Can you cover your needs, enjoy some wants, save for the future, and absorb a financial curveball without falling apart? That's the heart of middle class,' said Pavone. Secure your household financially. Build an emergency fund. Your net worth is essentially the value of all your assets minus all your liabilities (or debts). If you owe $200,000 on a house valued at $500,000, then your net worth is $300,000 (assuming no other debts). If you also have $100,000 in retirement savings or investments, add that to your total net worth. Knowing your net worth is key to understanding how financially secure you are. It gives you a more accurate picture of your overall financial health than income alone. But middle-class households often have a negative net worth — they just don't always realize it. 'In reality, many middle-class families are quietly carrying debt, juggling rising expenses, and struggling to keep up appearances,' said Pavone. 'It is more important to measure how much you save versus how much you make.' More From GOBankingRates What $1 Million in Retirement Savings Looks Like in Monthly Spending 6 Popular SUVs That Aren't Worth the Cost -- and 6 Affordable Alternatives 5 Little-Known Ways to Make Summer Travel More Affordable I'm a Retired Boomer: 6 Bills I Canceled This Year That Were a Waste of Money Sources: Melissa Murphy Pavone, Founder at Mindful Financial Partners Pew Research, 'Are you in the U.S. middle class? Try our income calculator' 'Income in the United States: 2023' Zillow, Columbus, OH Housing Market: 2025 Home Prices & Trends' Zillow, 'New York, NY Housing Market: 2025 Home Prices & Trends' Dave Ramsey Show, 'Where The Flip Are You People Spending Money?' Experian, 'Average Credit Card Debt Increases 3.5% to $6,730 in 2024' Consumer Financial Protection Bureau, 'Credit card interest rate margins at all-time high' Ramsey Solutions, 'Emergency Fund: Why You Need One and How Much to Save' This article originally appeared on 5 Ways To Become Financially Secure on a Middle-Class Salary Sign in to access your portfolio
Yahoo
16-05-2025
- Business
- Yahoo
5 Ways To Become Financially Secure on a Middle-Class Salary
Defining financial class isn't just based on the income you make. If it was then, by the Pew Research Center's definition of 'middle class,' you'd be firmly in that category if you earn between two-thirds and twice the U.S. median household income (which is $80,610). That means you'd be considered middle class if you earn $53,740 to $161,220 a year. Read More: Find Out: But income is only part of the bigger picture. Here are some of the top ways to become financially secure on a middle-class salary in the U.S. Your salary is a good starting point to determine your financial well-being, but you need to consider the bigger picture. Things like household size, where you live and your other financial obligations also matter. 'A big misconception is that a six-figure salary automatically means financial security,' said Melissa Murphy Pavone, Founder at Mindful Financial Partners. 'I work with clients making $150K+ who feel like they're barely treading water, especially in high-cost areas like New York.' Imagine a family of four living on $161,220 in New York City. The average home costs about $796,000 there. Tack on other common expenses like childcare, credit cards or other debts, groceries, healthcare and transportation, and you're looking at a potentially tight budget. Now, imagine someone with no kids or debts living in Columbus, Ohio where homes cost an average of $253,000. Assuming they have solid budgeting skills and pay attention to their spending and savings, they could be doing quite well for themselves on that salary. High earners live paycheck-to-paycheck or struggle with debt all the time. Take a California couple who recently called in to the Dave Ramsey Show as an example. They earn about $300,000 a year and owe $119,000 in debt (not including their mortgage). They also spend roughly $5,000 a month on their housing payment and are struggling to lower their expenses and pay off what they owe. No matter how much you're earning, one of the best ways to become financially secure is to make a spending plan or budget. You can keep things simple. For instance, you could follow the 50-30-20 budgeting rule wherein your income goes into the following categories: 50% for needs 30% for wants 20% for savings or debt Or you can break down your spending into larger categories like: Mortgage or rent Utilities Transportation Gas Clothing Food Insurance / healthcare Debts Saving and investing Miscellaneous Whatever you do, find a budget that works for you. If you find yourself spending too much in certain categories, try to back off a little and put that money toward more important things. According to Experian, the average person carries $6,730 in credit card debt. That might not seem like much if you're earning twice the median income, have no other debt obligations and are keeping other costs reasonably low. But if you have that much credit card debt, chances are you've got a spending problem — or you haven't prioritized paying off your balances. And considering how high credit card interest rates are (nearly 23% on average), that just means you're spending more than you ought. If you want to become more financially secure, start by tackling those debts. You can always use the debt snowball method, which focuses on paying off the smallest balance first before moving on to the next-smallest balance and so on. Many financial experts suggest having at least three to six months' worth of expenses in an emergency fund. If you're self-employed or have kids, you might want to shoot for a higher amount. A lot of middle-class households don't have an emergency fund at all. What this means is that even the smallest financial hiccup — like a surprise medical bill — could be detrimental to their monthly budget. It could even mean taking on a new debt to cover that bill. 'Middle class isn't just about income, it's about lifestyle sustainability. Can you cover your needs, enjoy some wants, save for the future, and absorb a financial curveball without falling apart? That's the heart of middle class,' said Pavone. Secure your household financially. Build an emergency fund. Your net worth is essentially the value of all your assets minus all your liabilities (or debts). If you owe $200,000 on a house valued at $500,000, then your net worth is $300,000 (assuming no other debts). If you also have $100,000 in retirement savings or investments, add that to your total net worth. Knowing your net worth is key to understanding how financially secure you are. It gives you a more accurate picture of your overall financial health than income alone. But middle-class households often have a negative net worth — they just don't always realize it. 'In reality, many middle-class families are quietly carrying debt, juggling rising expenses, and struggling to keep up appearances,' said Pavone. 'It is more important to measure how much you save versus how much you make.' More From GOBankingRates What $1 Million in Retirement Savings Looks Like in Monthly Spending Are You Rich or Middle Class? 8 Ways To Tell That Go Beyond Your Paycheck 5 Little-Known Ways to Make Summer Travel More Affordable 9 Downsizing Tips for the Middle Class To Save on Monthly Expenses Sources: Melissa Murphy Pavone, Founder at Mindful Financial Partners Pew Research, 'Are you in the U.S. middle class? Try our income calculator' 'Income in the United States: 2023' Zillow, Columbus, OH Housing Market: 2025 Home Prices & Trends' Zillow, 'New York, NY Housing Market: 2025 Home Prices & Trends' Dave Ramsey Show, 'Where The Flip Are You People Spending Money?' Experian, 'Average Credit Card Debt Increases 3.5% to $6,730 in 2024' Consumer Financial Protection Bureau, 'Credit card interest rate margins at all-time high' Ramsey Solutions, 'Emergency Fund: Why You Need One and How Much to Save' This article originally appeared on 5 Ways To Become Financially Secure on a Middle-Class Salary Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
08-02-2025
- Business
- Yahoo
4 Moves Retirees Should Make To Build Their Retirement Savings in 2025
After years of hard work, retirees deserve financial security — but staying ahead requires strategic money moves. Be Aware: Try This: 4 Unusual Ways To Make Extra Money That Actually Work Whether retirees want to grow their savings or protect what they've built, careful financial planning can make all the difference, said Melissa Murphy Pavone, the founder of Mindful Financial Partners. 'No matter where you are on your financial journey, it's never too late to build a strong retirement foundation.' Here are four smart moves retirees should make to build their retirement savings in 2025. One of the best moves retirees can make is to take advantage of tax-advantaged accounts like Roth IRAs or Health Savings Accounts. 'Investing in dividend-generating assets and exploring low-risk, long-term investments will help grow their savings steadily well beyond 2025,' said Christopher Stroup, CEO and founder of Silicon Beach Planning. 'Roth conversions, tax-loss harvesting and utilizing deductions can help reduce taxable income and keep more money in their pocket.' Christine Mueller Coley, a wealth advisor at SteelPeak Wealth Management, advised retirees to capitalize on today's high interest rates. 'Utilize a high-yield savings account, and consider locking in rates on bonds or fixed annuities,' Coley said. 'Understand that Social Security payments could change. There is talk of reducing COLAs (cost-of-living adjustments) and delaying or reducing Social Security benefits.' Consider This: Tom Buckingham, the chief growth officer at Nassau Financial Group, said retirees should consider waiting to withdraw money from their retirement savings accounts if they are no longer working full-time. 'That will allow you to stay invested and continue to grow your retirement assets, whether you own stocks and bonds or purchase other products, like CDs or fixed annuities.' If retirees must withdraw from their retirement savings, they should calculate their tax bracket first, said Melanie Musson of Clearsurance. 'If you're just over a tax bracket, try to reduce your retirement savings withdrawals, so you stay in the lower tax bracket,' Musson explained. Retirees could see a wealth of new investment opportunities this year, especially as President Donald Trump recently launched business deregulations and, Financial Times reported, the private equity industry plans to advocate for its inclusion in 401(k) plans. While these developments may create new opportunities, retirees should focus on protecting their savings by rebalancing their portfolios. 'In practice, this means diversifying their portfolio with stocks and bonds,' Stroup said. 'Retirees may benefit from inflation-hedged investments like Treasury Inflation-Protected Securities (TIPS) or real estate to diversify and stabilize their portfolio.' According to research from the Employee Benefit Research Institute (EBRI), 68% of retirees reported having outstanding credit card debt, 31% said their spending exceeds what they can afford and half saved less than they needed for retirement. However, retirees can regain control of their financial health by streamlining their spending and weighing the pros and cons of downsizing. 'Retirees could commit to making meals at home,' Musson said. 'YouTube has a lot of helpful content to learn how to cook. Homemade meals cost a lot less than the same meal eaten out.' Stroup suggested retirees periodically review and cut unnecessary subscriptions, which can free up a few hundred dollars each month. 'Ultimately, it's important for retirees to focus on essential expenses while maintaining an emergency fund to cover unforeseen costs that could come in the future,' Stroup said. More From GOBankingRates 4 Low-Risk Ways To Build Your Savings in 2025 3 Things You Must Do When Your Savings Reach $50,000 This article originally appeared on 4 Moves Retirees Should Make To Build Their Retirement Savings in 2025
