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Business Insider
29-05-2025
- Business
- Business Insider
7 things smart people do now to get out of debt soon
If you're not earning a lot, getting out of debt may seem out of reach — but it's not impossible. From automating payment to deciding on a debt payoff strategy to avoiding extreme budgets, smart money moves can help you get out of debt soon, regardless of how much you earn. 1. Automate your debt payments Setting up automatic debt payments is a great first step to paying off debt. "Set up regular payments from your checking account right when you get paid to pay down your debt," says Bobbi Rebell, CFP and personal finance expert with "If the money goes to the debt first, you won't be able to spend it elsewhere." Next, work on increasing how much you can put toward debt. "Focus on freeing up more of your money so you can increase your debt payments," she continues. "Small modifications add up and can make a huge difference in not only paying down debt but preventing future debt that has a nasty habit of creeping up the minute we let our guard down." 2. Decide on a debt payoff strategy And you can't just decide to pay off debt. You need a strategy, experts say. "There are a few common approaches to paying off debt regardless of income: avalanche, snowball, and consolidation," says Sabino Vargas, CFP, Senior Financial Advisor at Vanguard. The avalanche method focuses on paying off debt with the highest interest rate first while making minimum payments on other debt, he explains. For the snowball method, you pay the debt with the smallest balance first while making minimum payments on the other debts. Once that debt is paid off, you reallocate payments to the next lowest balance, and so on. Debt consolidation might be an option for people with a significant amount of debt, and it could save on interest. "In this method, you combine multiple debts into a single loan, often with a lower interest rate, leaving you with one monthly payment to manage," Vargos says. 3. Be lazy. Yes, really! "One of the most powerful things you can do is to be lazy and do less," Rebell says. "What I mean by this is just don't motivate yourself to go out for coffee. Instead, make it at home or just skip it. Spot something you want on Instagram? Before you buy, tell yourself you will come back to it later, and you may. Or you may not." Another "lazy" tip that can help eliminate debt? Don't store your credit card numbers on your devices. "[This] will force you to make the effort to put in the numbers each time. And hopefully you will … take the lazy way out and just not bother!" Rebell says. 4. Avoid extreme budgeting Sure, sticking to a budget is one way to properly allocate money to paying down debt, but it won't work if that budget is too restrictive or extreme, which Rebell says could backfire. And that cliché about millennials not being able to afford to buy a house because of their penchant for avocado toast or fancy coffees? Not accurate, says Alex Moore, Vice President and Financial Advisor at Wealth Enhancement. "Skipping lattes or avocado toast alone isn't going to pay off your student loans," he says. "The average American spends $2,091 a year on eating out and $2,050 a year on entertainment. The math doesn't work out. "What will have an impact is tracking and being intentional with each dollar you spend. I prefer cash because it forces you to think about each purchase and decide if the spend is worth it," he says. "Sometimes you really do need a latte to get through the day, and that's OK." 5. Don't ignore the rest of your finances Even if your main focus is paying off debt, don't ignore the rest of your financial picture. First, pad your emergency fund so that next time an unexpected expense pops up, you won't be forced to put it on a credit card. "Three months of expenses is the typical number," Moore says. "Without that cushion, you'll end up accruing new debt as you pay off old debt. The emergency fund gives you some margin for error if an unexpected expense pops up, even if it's not mathematically the most effective use of the dollars. Reduce your spending and get your emergency fund set up first before you begin aggressively paying off the debt." It's also wise to balance debt payment with saving and investing. Vargos warns against forgetting about your employer-matched 401(k). "When it comes to saving and investing, continue to save toward your retirement plan so you can take advantage of your employer's match program and not leave money on the table," he notes. 6. Know your debt Assess the type of debt you have. If it's high-interest debt from credit cards or personal loans, focus on paying that off before investing or saving, since those high interest rates cause your debt balances to grow more quickly. "Take the time to understand the math of your debt. That means knowing how much you owe and the interest rate, aka the cost associated with that debt," Rebell says. And think about your debt's interest rate versus the rate of return on your investments. "If the projected rate of return is higher than the interest rate, consider allocating more money toward investments or saving in higher-yielding accounts," Vargos says. And when it comes to getting serious about paying off debt, high earners aren't immune. "When I encounter debt, it's typically with high-income, high-debt folks," Moore says. "For them, the challenge is accepting that they need to reduce their lifestyle. It's a bitter pill to swallow when your friends are going on expensive vacations and you're not. The process of paying off debt is as much psychological as it is numerical." 7. Know when it's time for professional help If you have more than $7,500 in unsecured debt (such as credit card debt, personal loans, and medical bills) and are feeling completely overwhelmed, you might consider a debt relief company. Debt relief companies provide a service called debt settlement, where they negotiate with your creditors to settle your debts for less than the amount you originally owed. Once enrolled in a debt relief program, you make one monthly deposit into a dedicated savings account where you build up funds for settlements. Each time the debt relief company negotiates a settlement with a creditor (and you've approved the terms), both the settlement amount and the debt relief company's fees are paid from your dedicated account. This process continues until all your enrolled debts are resolved, usually 24-48 months. Note that even though the debt relief company is negotiating with your creditors, it can't guarantee results. You don't pay the debt relief company fees for their services until they've negotiated a settlement and you've approved it. The process may damage your credit score — but not as much as bankruptcy.
Miami Herald
21-05-2025
- Business
- Miami Herald
Saving through an energy-efficient home
Saving through an energy-efficient home Financial management isn't just about preparing for retirement or reducing taxes. It's also about looking for opportunities to save money over time. One way to accomplish this is by saving energy at home. An energy-efficient home is one that uses less energy on a day-to-day basis-and it can be accomplished with some simple lifestyle changes and eco-friendly home improvements. In some cases, these investments even qualify you for a tax credit, which can help defray your upfront costs. Here, Wealth Enhancement looks at several strategies you can adopt to save through an energy-efficient home. The benefits of an energy-efficient home The most obvious benefit of an energy-efficient home is that it may help to lower your energy costs. This matters more now than ever, with energy costs across the United States projected to be 10% higher in 2025 compared to just last year. The U.S. Department of Energy estimates that the average energy-efficient home saves up to 25% on utilities compared to similar homes not designed with efficiency in mind. However, the benefits don't stop there. By lowering energy usage, you can help the planet by reducing your home's greenhouse gas emissions. Your indoor environment might improve as well, with greater air quality and more consistent inside temperatures. Upgrades may even increase your home value, with homes rated as energy-efficient selling for 2.7% above comparable unrated homes. How to make your home more energy efficient If you would like to unlock the advantages of an energy-efficient home, here are a few ways to get started: Get a home energy audit. Many local utility companies offer energy audits to help identify areas for improvement, such as air leaks around windows or doors, poor insulation, or inefficient appliances. Starting here can help you pinpoint where to focus your energy improvement some lifestyle changes. While some energy-efficient upgrades cost money, others simply require you to change some of your habits. For instance, turning off your lights, unplugging unused devices, and closing your blinds during the summer to reduce heat transfer are all easy ways to start saving by reducing energy consumption. Other easy fixes include changing your furnace filter regularly, lowering the temperatures on your thermostat and water heater, using low-flow faucets to conserve water, and even planting trees strategically to gain some LED lighting. The case for energy-efficient lighting is strong, with LED bulbs using up to 90% less energy and lasting up to 25 times longer than traditional incandescent A home's insulation can shrink over time, resulting in heat loss during the winter and heat retention during warmer months. Properly insulating your attic, walls, and floors can cut your energy bills and make your home more comfortable in the your windows. Older homes tend to leak two to four times more air than newer homes, so you can improve energy efficiency by sealing leaks with weatherstripping and caulking. If your windows are older, you may also want to consider replacing them. Newer windows rely on more advanced technology that controls heat transfer, which could help reduce your energy usage by up to 30%.Upgrade your appliances. Just like older windows are less efficient, so are older appliances. By switching to Energy Star-certified appliances, you can reduce energy consumption and improve efficiency. Newer refrigerators, for instance, could reduce energy consumption by up to 9%, and newer dishwashers typically use less water and less your heating and cooling systems. Upgrading your heating, ventilation, and air conditioning (HVAC) systems can often deliver greater energy efficiency, but there are other changes you can make that also help. For instance, ceiling fans consume 99% less energy than central air conditioning systems. Even switching to a smart thermostat can help by automating and regulating your home's temperature your water heater. Older water heaters typically hold a reservoir of hot water and expend energy to keep that water hot. Tankless water heaters, however, heat water on demand, which can reduce energy consumption by up to 34%.Go solar. Depending on where you live, you may be able to use solar energy to electrify your home, reducing reliance on the traditional power grid. Installing solar panels is a good way to reduce energy costs and could even result in financial credits if you can sell excess energy back to the grid. Qualifying for tax credits Enhancing your home's energy efficiency can deliver ongoing savings over time. You may even be able to defray the initial costs of certain home improvements with the energy efficient home improvement credit. Qualified energy-efficient home improvements made after Jan. 1, 2023, may make you eligible for a tax credit of up to $3,200, claimable for improvements to your primary residence made through 2032. The credit equals 30% of qualified expenses such as home energy audits, residential energy property expenses, and energy efficiency improvements. The maximum annual credit is $1,200 for energy-efficient property costs and certain energy-efficient home improvements and $2,000 for qualified heat pumps, water heaters, and biomass stoves and boilers. Additionally, the credit has no lifetime dollar limit, which means you can claim the annual amounts for every year you make eligible improvements. That said, beginning in 2025, the credit is only available if the energy-efficient items were produced by a qualified manufacturer, so it's important to check in advance if the items you select qualify. Bottom line Making your home more energy efficient can deliver a range of benefits, from reduced utility bills and positive environmental outcomes to potential increases in the value of your home. With available tax credits and potential rebates or incentives from local utility companies, energy-efficient home improvements can be a sound investment that pays off in greater comfort and financial savings over time. This story was produced by Wealth Enhancement and reviewed and distributed by Stacker. © Stacker Media, LLC.
Gulf Today
11-03-2025
- Business
- Gulf Today
US stock market loses $4 trillion in value as Trump ploughs ahead on tariffs
President Donald Trump's tariffs have spooked investors, with fears of an economic downturn driving a stock market sell-off that has wiped out $4 trillion from the S&P 500's peak last month, when Wall Street was cheering much of Trump's agenda. A barrage of new Trump policies has increased uncertainty for businesses, consumers and investors, notably back-and-forth tariff moves against major trading partners like Canada, Mexico and China. "We've seen clearly a big sentiment shift," said Ayako Yoshioka, senior investment strategist at Wealth Enhancement. "A lot of what has worked is not working now." The stock market selloff deepened on Monday. The benchmark S&P 500 fell 2.7%, its biggest daily drop of the year. The Nasdaq Composite slid 4%, its largest one-day decline since September 2022. The S&P 500 on Monday closed down 8.6% from its February 19 record high, shedding over $4 trillion in market value since then and nearing a 10% decline that would represent a correction for the index. The tech-heavy Nasdaq ended Thursday down more than 10% from its December high. Trump over the weekend declined to predict whether the US could face a recession as investors worried about the impact of his trade policy. Damage to economic prospects "The amount of uncertainty that has been created by the tariff wars with regard to Canada, Mexico and Europe, is causing boards and C-suites to reconsider the pathway forward," Peter Orszag, CEO of Lazard, speaking at the CERAWeek conference in Houston. "People can understand ongoing tensions with China, but the Canada, Mexico, and Europe part is confusing. Unless that gets resolved over the next month or so, this could do real damage to the economic prospects of the US and M&A activity," Orszag said. Delta Air Lines on Monday slashed its first-quarter profit estimates by half, sending its shares down 14% in aftermarket action. CEO Ed Bastian blamed heightened US economic uncertainty. Investors are also watching whether lawmakers can pass a funding bill to avert a partial federal government shutdown. A US report on inflation looms on Wednesday. 'OK if the market falls' "The Trump administration seems a little more accepting of the idea that they're OK with the market falling, and they're potentially even OK with a recession in order to exact their broader goals," said Ross Mayfield, investment strategist at Baird. "I think that's a big wake-up call for Wall Street." The percentage of total corporate equities and mutual fund shares that are owned by the bottom 50% of the US population, ranked by wealth, stands at about 1%, while the same measure for the top 10% of the population by wealth stood at 87%, according to Federal Reserve Bank of St. Louis data as of July 2024. The S&P 500 tallied back-to-back gains of over 20% in 2023 and 2024, led by megacap technology and tech-related stocks such as Nvidia and Tesla that have struggled so far in 2025, dragging major indexes. Tesla loses $125 billion On Monday, the S&P 500's technology sector dropped 4.3%, while Apple and Nvidia both fell about 5%. Tesla tumbled 15%, shedding about $125 billion in value. Other risk assets were also punished, with bitcoin dropping 5%. Some defensive areas of the market held up better, with the utilities sector logging a 1% daily gain. Safe-haven US government debt saw more demand, with benchmark 10-year Treasury yields, which move inversely to prices, down to about 4.22%. Investor unease The S&P 500 has given up all gains recorded since Trump's November 5 election, and it is down nearly 3% in that time. Hedge funds reduced exposure to stocks on Friday at the largest amount in more than two years, according to a Goldman Sachs note released on Monday. Investors had expressed optimism that Trump's expected pro-growth agenda including tax cuts and deregulation would benefit stocks, but uncertainty over tariffs and other changes including federal workforce cuts, has dampened sentiment. "It was the overwhelming consensus that everything was going to be this great environment once President Trump came into office," said Michael O'Rourke, chief market strategist at JonesTrading. "Every time you have structural change you're going to have uncertainty and you're going to have friction," O'Rourke said. "It's understandable people are starting to be a little concerned and starting to take profits." Even with the recent selloff, stock market valuations remain significantly above historic averages. The S&P 500 as of Friday was at just above 21 times earnings estimates for the next year, compared to its long-term average forward P/E of 15.8, according to LSEG Datastream. "Many people have been worried about elevated valuations among US equities for some time and looking for the catalyst for a market correction," said Dan Coatsworth, investment analyst at AJ Bell. "A combination of concerns about a trade war, geopolitical tensions and an uncertain economic outlook could be that catalyst." Investors' equity positioning has fallen in recent weeks, dipping to slightly underweight for the first time since briefly hitting that level in August, Deutsche Bank analysts said in a note on Friday. A further retreat to the bottom of the historic range for equities weighting, as seen during Trump's US.-China trade war in 2018-2019, could drag the S&P 500 to as low as 5,300, or down another 5.5% from current levels, they added. In another sign of growing investor unease, the Cboe Volatility index on Monday reached its highest closing level since August. The administration is "still trying to figure out how to define a win politically, economically, and what is the right timeframe," said Edward Al-Hussainy, senior interest rate and currency analyst at Columbia Threadneedle Investments. "And until they do that, it's going to be like this every week."
Zawya
11-03-2025
- Business
- Zawya
US stock market loses $4trln in value as Trump plows ahead on tariffs
NEW YORK: President Donald Trump's tariffs have spooked investors, with fears of an economic downturn driving a stock market sell-off that has wiped out $4 trillion from the S&P 500's peak last month, when Wall Street was cheering much of Trump's agenda. A barrage of new Trump policies has increased uncertainty for businesses, consumers and investors, notably back-and-forth tariff moves against major trading partners like Canada, Mexico and China. "We've seen clearly a big sentiment shift," said Ayako Yoshioka, senior investment strategist at Wealth Enhancement. "A lot of what has worked is not working now." The stock market selloff deepened on Monday. The benchmark S&P 500 fell 2.7%, its biggest daily drop of the year. The Nasdaq Composite slid 4%, its largest one-day decline since September 2022. The S&P 500 on Monday closed down 8.6% from its February 19 record high, shedding over $4 trillion in market value since then and nearing a 10% decline that would represent a correction for the index. The tech-heavy Nasdaq ended Thursday down more than 10% from its December high. Trump over the weekend declined to predict whether the U.S. could face a recession as investors worried about the impact of his trade policy. "The amount of uncertainty that has been created by the tariff wars with regard to Canada, Mexico and Europe, is causing boards and C-suites to reconsider the pathway forward," Peter Orszag, CEO of Lazard, speaking at the CERAWeek conference in Houston. "People can understand ongoing tensions with China, but the Canada, Mexico, and Europe part is confusing. Unless that gets resolved over the next month or so, this could do real damage to the economic prospects of the US and M&A activity," Orszag said. Delta Air Lines on Monday slashed its first-quarter profit estimates by half, sending its shares down 14% in aftermarket action. CEO Ed Bastian blamed heightened U.S. economic uncertainty. Investors are also watching whether lawmakers can pass a funding bill to avert a partial federal government shutdown. A U.S. report on inflation looms on Wednesday. "The Trump administration seems a little more accepting of the idea that they're OK with the market falling, and they're potentially even OK with a recession in order to exact their broader goals," said Ross Mayfield, investment strategist at Baird. "I think that's a big wake up call for Wall Street." The percentage of total corporate equities and mutual fund shares that are owned by the bottom 50% of the U.S. population, ranked by wealth, stands at about 1%, while the same measure for the top 10% of the population by wealth stood at 87%, according to Federal Reserve Bank of St. Louis data as of July 2024. The S&P 500 tallied back-to-back gains of over 20% in 2023 and 2024, led by megacap technology and tech-related stocks such as Nvidia and Tesla that have struggled so far in 2025, dragging major indexes. On Monday, the S&P 500's technology sector dropped 4.3%, while Apple and Nvidia both fell about 5%. Tesla tumbled 15%, shedding about $125 billion in value. Other risk assets were also punished, with bitcoin dropping 5%. Some defensive areas of the market held up better, with the utilities sector logging a 1% daily gain. Safe-haven U.S. government debt saw more demand, with benchmark 10-year Treasury yields, which move inversely to prices, down to about 4.22%. INVESTOR UNEASE The S&P 500 has given up all gains recorded since Trump's November 5 election, and it is down nearly 3% in that time. Hedge funds reduced exposure to stocks on Friday at the largest amount in more than two years, according to a Goldman Sachs note released on Monday. Investors had expressed optimism that Trump's expected pro-growth agenda including tax cuts and deregulation would benefit stocks, but uncertainty over tariffs and other changes including federal workforce cuts, has dampened sentiment. "It was the overwhelming consensus that everything was going to be this great environment once President Trump came into office," said Michael O'Rourke, chief market strategist at JonesTrading. "Every time you have structural change you're going to have uncertainty and you're going to have friction," O'Rourke said. "It's understandable people are starting to be a little concerned and starting to take profits." Even with the recent selloff, stock market valuations remain significantly above historic averages. The S&P 500 as of Friday was at just above 21 times earnings estimates for the next year, compared to its long-term average forward P/E of 15.8, according to LSEG Datastream. "Many people have been worried about elevated valuations among U.S. equities for some time and looking for the catalyst for a market correction," said Dan Coatsworth, investment analyst at AJ Bell. "A combination of concerns about a trade war, geopolitical tensions and an uncertain economic outlook could be that catalyst." Investors' equity positioning has fallen in recent weeks, dipping to slightly underweight for the first time since briefly hitting that level in August, Deutsche Bank analysts said in a note on Friday. A further retreat to the bottom of the historic range for equities weighting, as seen during Trump's U.S.-China trade war in 2018-2019, could drag the S&P 500 to as low as 5,300, or down another 5.5% from current levels, they added. In another sign of growing investor unease, the Cboe Volatility index on Monday reached its highest closing level since August. The administration is "still trying to figure out how to define a win politically, economically, and what is the right timeframe," said Edward Al-Hussainy, senior interest rate and currency analyst at Columbia Threadneedle Investments. "And until they do that, it's going to be like this every week." (Reporting by Lewis Krauskopf; additional reporting by Saqib Iqbal Ahmed, Davide Barbuscia and Caroline Valetkevitch in New York and Lisa Pauline Mattackal and Manya Saini in Bengaluru; editing by Megan Davies, Christina Fincher, Cynthia Osterman and David Gregorio)
Yahoo
10-03-2025
- Business
- Yahoo
Investors flee equities as Trump-driven uncertainty sparks economic worry
By Lewis Krauskopf and Saqib Iqbal Ahmed NEW YORK (Reuters) -Investor fears that trade tariffs will spark an economic downturn are driving a sell-off in equities that has wiped out trillions of dollars in value, a major reversal for Wall Street which had been fired-up by President Donald Trump's agenda. A barrage of new Trump policies including back and forth tariff moves against major trading partners like Canada, Mexico and China has increased uncertainty for businesses, consumers and investors. "We've seen clearly a big sentiment shift," said Ayako Yoshioka, senior investment strategist at Wealth Enhancement. "A lot of what has worked is not working now." The recent selloff in stocks deepened on Monday, with the benchmark S&P 500 down about 2.5% in afternoon trade and the Nasdaq Composite sliding over 4%. The S&P 500 on Monday was down more than 8% from its February 19 record high, shedding over $4 trillion in market value since then and nearing a 10% decline that would represent a correction for the index. The tech-heavy Nasdaq ended Thursday down more than 10% from its December high. Trump over the weekend declined to predict whether the U.S. could face a recession amid stock market concerns about the impact of his tariff actions. Beyond the tariff uncertainty, investors are watching to see if lawmakers can pass a funding bill to avert a partial federal government shutdown, while a crucial report on inflation looms on Wednesday. "The Trump administration seems a little more accepting of the idea that they're OK with the market falling, and they're potentially even OK with a recession in order to exact their broader goals," said Ross Mayfield, investment strategist at Baird. "I think that's a big wake up call for Wall Street." The S&P 500 tallied back-to-back gains of over 20% in 2023 and 2024, led by megacap technology and tech-related stocks such as Nvidia and Tesla that have struggled so far in 2025 and dragged major indexes down with them. Those tech and megacap stocks that had propelled the market higher the past two years were getting hit hard on Monday. The S&P 500's technology sector dropped over 4%, while Apple fell nearly 6% and Tesla tumbled 14%. Some defensive areas of the market were outperforming, with the utilities sector logging a gain on the day. Safe-haven U.S. government debt saw more demand on Monday, with benchmark 10-year Treasury yields, which move inversely to prices, down to about 4.22%. INVESTOR UNEASE The S&P 500 has given up all gains recorded since Trump's November 5 election, and it is down more than 2% in that time. Investors had expressed optimism that Trump's expected pro-growth agenda including tax cuts and deregulation would benefit stocks, but uncertainty over tariffs and other changes including federal workforce cuts, have dampened sentiment. "It was the overwhelming consensus that everything was going to be this great environment once President Trump came into office," said Michael O'Rourke, chief market strategist at JonesTrading. "Every time you have structural change you're going to have uncertainty and you're going to have friction," O'Rourke said. "It's understandable people are starting to be a little concerned and starting to take profits." While stock valuations have moderated with the recent selloff, the market broadly is still significantly above historic averages. The S&P 500 as of Friday was at just above 21 times earnings estimates for the next year, compared to its long-term average forward P/E of 15.8, according to LSEG Datastream. "Many people have been worried about elevated valuations among U.S. equities for some time and looking for the catalyst for a market correction," said Dan Coatsworth, investment analyst at AJ Bell. "A combination of concerns about a trade war, geopolitical tensions and an uncertain economic outlook could be that catalyst." Investors' equity positioning has fallen in recent weeks, dipping to slightly underweight for the first time since briefly hitting that level in August, Deutsche Bank analysts said in a note on Friday. A further retreat to the bottom of the historic range for equities weighting, as seen in during Trump's U.S.-China trade war in 2018-2019, could drag the S&P 500 to as low as 5,300, or down another roughly 6% from current levels, they added. In another sign of growing investor unease, the Cboe Volatility index on Monday hit its highest level since late December. The administration is "still trying to figure out how to define a win politically, economically, and what is the right timeframe," said Edward Al-Hussainy, senior interest rate and currency analyst at Columbia Threadneedle Investments. "And until they do that, it's going to be like this every week." Sign in to access your portfolio
