Entries in Spending (44)


Consumers Remain Cautious About Spending

Brand X Pictures/Thinkstock(NEW YORK) -- With all the market euphoria, a rally in the housing market, plus gains for auto sales, it may be surprising that U.S. consumers are still very cautious about spending money.

A government survey released late last week showed the savings rate rose in December.

Phil Orlando, chief equities strategist at Federated Investors, tells ABC News Radio, “If consumers and businesses were extraordinarily confident they would be going out and spending and bringing that savings rate down.”

Gridlock in Congress may be one reason why consumers and businesses remain so cautious.

“I think what’s been going on in Washington is an economic chilling effect,” says Orlando.  “People just don’t know what to make of it and to some degree some businesses and consumers may have just held back a little bit.”

Despite recent gains, consumer confidence remains well below its historical average.

Copyright 2013 ABC News Radio


Fed Report Shows Consumer Credit Growth in May

Justin Sullivan/Getty Images(WASHINGTON) -- A Federal Reserve report out Monday showed that Americans spent more on credit cards in May, the highest monthly gain in four years. Consumer credit climbed to $2.6 trillion, a more than $17 billion increase, according to the report.  

During the month of May, the report says non-revolving credit, including student loans and auto financing, grew by a seasonally adjusted $9 billion to $1.7 trillion. Revolving credit ballooned by $ 8 billion to $870 billion.

With the economy still floundering, the increase in reliance on plastic is likely also the result of the slowdown -- there are not enough wages to cover expenses.

Stuart Hoffman, chief economist at PNC Financial Services Group, says the report may be the result of student loan debt and not much of an indicator of consumer spending in general. According to the report, student lending appeared to be a major driver for overall credit growth -- up $6.2 billion in May to $464.9 billion.

"This report today shows a little more borrowing, but you now put that in a bigger context with consumers you're still not seeing a lot of job growth and still being cautious. I don't think this represents any kind of a big upside for consumer spending," he says.

Hoffman adds the increases don't seem that large when one considers that, "a lot of students are still borrowing to be able to go to college."

Copyright 2012 ABC News Radio


Americans Earning a Bit More, But Spending Cautiously

Comstock/Thinkstock(NEW YORK) -- Monday’s income and outlays report from the Bureau of Economic Analysis is about as expected, with not much good news but no major bad news.
American incomes increased 0.4 percent, according to the report. If this trend continues, maybe the strength of the consumer will continue to buoy the economy in the future.
But spending dropped compared to a month ago.  This may be because spending had been pushed up earlier in the year because of warm weather.
The personal savings rate edged up to 3.8 percent last month from 3.7 percent in February.
While the U.S. economy isn’t in a recession, the recent batch of data does not show a robust recovery.
Copyright 2012 ABC News Radio


Prom Spending Jumps 33 Percent Nationwide

Digital Vision/Thinkstock(NEW YORK) -- Many segments of the U.S. economy continue to struggle in the wake of the recent recession, but the prom industry is booming, according to a new national survey by Visa Inc.

The survey finds American families with teenagers will spend an average of $1,078 each on a prom in 2012, a 33.6-percent increase over the $807 spent last year.

Families in the Northeast will spend twice as much on a prom as every other region of the country.

Jason Alderman, senior director of Global Financial Education, Visa Inc., says, “Prom season spending is spiraling out of control as teens continuously try to one-up each other.”

Alderman adds, “It’s important to remember that the prom is a high school dance, not a wedding, and parents need to set limits in order to demonstrate financial responsibility.”

The survey also reveals that parents are planning to cover 61 percent of prom costs while their teens are only covering the remaining 39 percent.

“One of the reasons that prom spending may be running amok is that parents are paying the vast majority of costs, giving teens little incentive to economize,” says Alderman.

Other notable survey results:

  • Northeastern families will spend an average of $1,944.
  • Southern families will spend an average of $1,047.
  • Western families will spend an average of $744.
  • Midwestern families will spend an average of $696.

Prom spending broken down by family income:

  • Parents who make under $20,000 will spend an average of $1,200.
  • Parents who make $20,000-$29,999 will spend an average of $2,635.
  • Parents who make $30,000-$39,999 will spend an average of $801.
  • Parents who make $40,000-$49,999 will spend an average of $695.
  • Parents who make over $50,000 will spend an average of $988.
  • Parents who make over $75,000 will spend an average of $842.

The Visa Inc. survey is based on 1,000 telephone interviews.

Copyright 2012 ABC News Radio


Prom Season: How Much Are You Spending?

Digital Vision/Thinkstock(NEW YORK) -- A new survey by Visa finds that high school students and their parents are spending more on the prom this year.

The average family will shell out $1,078 for their kids' red carpet event this year, up from last year's average of just more than $800.

Analysts say peer pressure is turning the prom into a social arms race, as teens attempt to impress and outdo each other with limos, flowers, and lavish gowns and tuxes.

Copyright 2012 ABC News Radio


‘Frugal February’ Family: ‘Best Month of Our Lives’

Shelley Dunning(DAVIS, Calif.) -- The Dunning family in Davis, Calif., vowed not to do any discretionary spending for the month of February.  Now, family patriarch Bob Dunning reports that it was the “best month of our lives.”

At the end of the month, Dunning, a writer for the Davis Enterprise, a newspaper, said the experiment was an enormous success and “not what I expected.” What led to the happy result was enthusiasm from his four children, ages 10, 9, 8, and 7.

Asked about highs and lows for the month, Dunning said, “the easiest was that our kids totally bought into it.”

One evening, his wife Shelley was making corn chowder out of frozen items and thought aloud that she did not have an onion.  “I said we could get an onion,” Bob Dunning said, “but immediately four little voices said, ‘No, we can’t!’”

“We never got a complaint,” he said. “That was really pleasing and probably a little surprising. We never tried to do this and they’re pretty normal kids.”

Except for a small fund for milk for the kids and home utilities, the family vowed not to make any miscellaneous purchases, even gas. That meant eating free samples at Costco and even making home-made valentines for classmates with flour instead of glue. The family went on more walks, too.

It helped that the parents can work from home and the kids can walk to school. The kids had to leave home 30 minutes earlier to get to school on time, but Dunning said the warmer-than-usual February weather and the children’s commitment to the promise helped.

The most difficult moment of the month was when the family was invited to be guests on a radio show in San Francisco. Luckily they had enough gas already in the tank to drive the 150-mile round trip. Still, Dunning said it was tempting going to San Francisco where at “absolutely every step there is something for sale.”

“That was the hardest thing we did. We went to San Francisco and literally did not spend a dime,” he said.

Now that the month is over, Dunning said “this may have been the best month of our lives.”

“We thought it would be like Lent growing up,” he said, referring to the Christian practice of prayer and fasting 40 days before Easter. “You give something up and then it’s a party.”

But in the end, he said, separating needs from wants was a healthy thing.

“Even though we were a close family, we got closer.”

When asked what items he will buy now that it’s March, he said he can’t think of an item. He said the family will likely continue their habits from the month, including eating dinner leftovers for lunch the next day and walking to school.

Copyright 2012 ABC News Radio


Valentine’s Day Savings: 20 Ideas to Spend Less

Hemera/Thinkstock(NEW YORK) -- While the origins of Valentine’s Day show it as a day to celebrate love and romance, today, centuries later, it’s a day as much about spending money on your loved ones as it is about showing them your love.

Last year, couples spent $1.7 billion on flowers, $3.4 billion on dining out and $3.5 billion on jewelry, according to a survey released by

Men spent about $160 on their valentine, while women spent nearly $75 on theirs, the survey found.

And this year, total spending will hit $17.6 billion, according to the National Retail Federation.

Despite the statistics, showing your love doesn’t mean you have to blow your budget.

Try these 20 low-cost ideas for turning your Feb. 14 back into a celebration full of love, not an empty bank account.

  • Take a hike or a walk on the beach, or just get outside to enjoy whatever environment in which you live.
  • Treat your loved one to breakfast in bed.
  • Make paper flowers full of heartfelt messages your loved one can keep instead of spending money on real flowers that will wither.
  • Make a CD of you and your loved one’s favorite love songs.
  • Turn loose photos and memorabilia into a scrapbook documenting your relationship or a special time you shared together.
  • Create a coupon book of tasks or special things you’ll do for your loved one throughout year.
  • Make it a movie night in to avoid the crowds and curl up with popcorn and your favorite classic.
  • Go on a picnic and make it elegant with candles and a tablecloth.
  • Make something homemade for your loved one, such as jewelry or a painting or a collage.  Even if you don’t think of yourself as crafty, just a homemade card made with your best efforts will be appreciated.
  • Try something new together like a dance, art or music class.
  • Check with your neighbors and friends about going in on a group babysitter so the kids can have a fun night together while the adults get a night off.
  • Make your loved one’s favorite homemade meal instead of dining out at a pricey and likely crowded restaurant.
  • Create a DVD of your favorite memories together.
  • Search online daily discount and coupon sites for special deals on restaurants or activities in your area.
  • Give your loved one a massage and a basket of soaps and lotions in his or her favorite scent.
  • Celebrate a day, week or even a month later so that you can avoid holiday price hikes and take advantage of restaurant, travel or shopping deals down the road.
  • Find a free activity like an art show, park or public concert in your area to enjoy.
  • Write a love letter.  Paper and pen are cheap, the tradition never gets old and you can’t beat a truly heartfelt gift.
  • Commit to shortening the “honey do” list that may have been building since last Valentine’s Day.
  • Turn an old shoebox or other container into a keepsake box and start the collection off for your loved one by including a few special mementos.

Copyright 2012 ABC News Radio


Calif. Family Vows Not to Spend Money for Month

Zoonar/Thinkstock(SACRAMENTO, Calif.) -- Some have heard of “frugal Fridays,” but the Dunning family in Davis, Calif., is practicing “frugal February.”

“Since my pockets were empty, it was not a real hard decision to make,” writer Bob Dunning said.

The family of six has vowed not to do any discretionary spending for the month of February.

“It was interesting after spending so much money during the holidays, Christmas, to think, wow, how much could we cut back?” Shelley Dunning told ABC’s Sacramento affiliate, KXTV.

She said she hopes the experiment will, “reset our clock on everything.”

“I hope that at the end of this month we can look back and say, gosh we had a lot of fun with each other,” she said.

Shelley Dunning said the family plans to eat a lot of rice and frozen meat, so they went to Costco on Jan. 31 to stock up on other foods like butter, pasta, nuts, and peanut butter and jam. The only miscellaneous thing the family plans to spend money on is fresh milk for the kids.

Bob Dunning clarifies that the family is just vowing against discretionary spending, like a coffee or movie tickets here and there.

“It adds up real fast and I wasn’t sure if we could do it or not,” he said.

And what about gas for the family’s car? The family plans to walk. That’s a good thing because the national weekly gas price average jumped 4 cents to $3.48 for regular for the week ending Feb. 6, up 35 cents from a year ago. Fortunately, Bob and Shelley both work from home.

Copyright 2012 ABC News Radio


Coffee, Lunch Spending Tops Tax Refunds

Gerald Zanetti/FoodPix(NEW YORK) -- Want to save $2,000 a year? Pack your lunch. Wanna save another grand? Fill a thermos with coffee while you’re at it.

The average amount working Americans spend on coffee and lunch is more than the average tax return refund they will receive, with two-thirds of American workers buying their lunches, according to a survey by Accounting Principals, a staffing and recruitment firm. The average spent on lunch alone is $37 a week, or $2,000 a year.

The survey found noticeable workplace spending differences by gender and age. Men spend $46.50 a week while women spend $26.50 on lunches.

Americans spend more money on their lunches than on their commuting costs, which was an average of $123 a month, or $1,500 a year.

Accounting Principals asked Braun Research to conduct a telephone survey of 1,000 employed Americans, 18 and older, from Dec. 22 to 27. The survey found men tend to purchase and spend more on coffee than women, 54 percent and 45 percent, respectively.

Half of Americans buy coffee regularly at work, spending more than $20 a week, or $1,000 a year. Younger professionals ages 18 to 34 spend nearly twice as much on coffee -- $24.74 -- during the week than those ages 45 and up -- $14.15.

The average tax refund in 2011 was $2,913, according to Yahoo! Finance.

Americans are not planning to use their year-end bonuses on food or drink, however. The survey found 57 percent of employed Americans plan to use their year-end bonus to pay off debt.

And, according to the survey, one-third of employees have a financial goal of bringing their lunch to work in 2012.

Copyright 2012 ABC News Radio


Best Buy Reports Weak Holiday Sales

KAREN BLEIER/AFP/Getty Images(RICHFIELD, Minn.) -- Feeling the squeeze by online retailers like Amazon and discount stores like Wal-Mart, Best Buy is reporting weak December sales, according to the Wall Street Journal, and the company’s CEO says customer traffic was unexpectedly low.

The company just days before Christmas informed customers it could not deliver on purchases made on the web in late November. Customers were left without the items they ordered.

Copyright 2012 ABC News Radio

ABC News Radio