Staying on Trend with Your Money: A Look at the Latest Trends in Personal Finance
Personal finance trends are changing and with those changes come the opportunities to build a stronger investment portfolio, reduce debt levels and increase savings for the future. It’s also a good idea to reflect on what trends weren’t working for your financial situation last year.
Here is a quick look at some of the latest trends in personal finance and you can use them to your advantage.
Lower income taxes
It’s possible that 2017 could see income taxes reduced, under changes proposed by President Trump. While some people could potentially save plenty of money, the changes are by no means spread across every tax bracket.
Additional student loan options
There is speculation about Trump reviving the role private lenders play in issuing federal student loans. If the proposed changes occur, the federal government will play a lesser role in providing financing to students, but private lenders may have broader rights to offer student loans. The result could mean making it easier for struggling students to manage a personal loan for their financing needs, instead of worrying about multiple different federal loans and payments each month.
Cheaper travel costs
If you’re planning on making 2017 the year you travel to Europe or the UK, you might find that your travel costs are cheaper now than they were last year. The values of the British Pound and the Euro have both weakened against the US dollar.
The Euro is currently trading at around $1.06 and the British Pound is trading at $1.24. Effectively, you’re getting a better exchange for your cash while you’re overseas. The result could make your trip to Europe more affordable than it has been in recent years.
Stronger stock market
If you’re keen to start building your stock portfolio, the S&P500, Dow and NASDAQ have jumped by around 30% since the beginning of 2017 and show no signs of slowing down anytime soon. Investing in stocks with a solid history of paying investors good dividend yields can be a great way to boost your financial situation.
Higher interest rates
The Federal Reserve made the decision in December 2016 to raise short-term interest rates, indicating the latest sign of increasing borrowing costs. While the decision doesn’t directly affect long-term interest rates, such as those on 15-year or 30-year fixed rate mortgages, most people may notice that the rates on outstanding credit card balances or auto loans may have climbed a bit.
However, if you’re working to boost your savings balances, many banks have increased the interest they pay on your savings. If you have a bank deposit account, the yield your cash is earning has risen, meaning you could receive better returns on your funds.
Higher consumer debt levels
Despite short-term interest rates rising, Americans are borrowing more money in 2017 than ever before. Market analysts predict that the two types of loans likely to become the country’s biggest debt drivers throughout the year are mortgage loans and student loans.
The latest personal finance trends could have an impact on your financial situation over the coming year, so keep an eye on them. You might be able to take advantage of some of them for your own benefit.