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Gift Giving on a Budget: How to spend more wisely this Holiday Season

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By Tyler Thielmann, Spring Financial

Special to Financial Independence Hub

A recent survey from Canadian fintech company Spring Financial, found that nearly three quarters (74%) of respondents plan on reducing holiday spending this year and shoppers, particularly Gen Z (66%) and millennials (64%), are finding the financial strain of buying gifts to be the most stressful part of the holidays.

The economy has been challenging this year so it’s no surprise that shoppers are feeling added stress this holiday season. Whether you’ve already started your shopping or you haven’t even started your list, below are some practical holiday shopping tips to help make your spending less stressful and more manageable.

1.) Spread the joy of pre-loved items

This one might be easier said than done but with half of shoppers opting for gift alternatives, there’s a good chance your friends and family may be relieved about the idea of traditional gifts with more financially feasible alternatives. For example, places like Facebook marketplace often have gently-used children’s toys that offer a more budget-friendly price tag for the little ones on your list, while a traditional baking or book exchange can be a great alternative to Secret Santa games for the adults in your life.

2.) Set a budget and stick to it

It can be so easy to overspend during the holidays. There is always someone to shop for and shops — whether online or in-store — are set up in a way that encourages impulse buying and overspending. To set yourself up for success, set a budget and shopping plan before starting shopping to ensure you’re sticking to a spending limit that works for you. Don’t forget to account for all the extra expenses that come with this time of year like food, host gifts, and transportation to and from any holiday parties you have coming up.

3.) Compare your debt options

Sometimes, taking on a bit of debt is necessary to keep the holiday magic alive. The good news is, there are lots of financial options available to shoppers. Comparing the interest rates on any buy-now-pay-later programs as well as credit cards, lines of credit and loan is a great way to determine which debt option will be the easiest to pay off post-holidays. Continue Reading…

Franklin Templeton 2025-2035 Outlook: Stocks will beat bonds, EAFE/EM may edge out North American stocks

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Stocks are expected to outperform bonds over the next 10 years but EAFE and Emerging Markets will probably do a little better than U.S. and Canadian equities, portfolio managers for Franklin Templeton Investment Solutions told advisors and the media in its 2025 Outlook session held Thursday in Toronto. The twice-annual economic outlook marks the 70th year that Franklin Templeton has operated in Canada: Sir John Templeton’s famous Templeton Growth Fund was launched in Canada in 1954. It has been in the U.S. more than 75 years.

Senior Vice President and Portfolio Manager Ian Riach [pictured left] said in a presentation distributed to attendees that “expected returns for fixed income have become slightly less attractive as yields have moved lower over the past year. EAFE and Emerging market equities [are] expected to outperform U.S and Canadian equities.” The most likely path to stable returns will be through “a diversified and dynamic approach,” he said.

Shorter-term Macro themes

Addressing major shorter-term themes, Riach said the United States continues to lead in Growth, while Canada is improving and the rest of the world is “challenged.” Inflation continues to trend down but some areas are faster than others. Fiscal policy “remains supportive” while “central banks remain data dependent.”

Addressing Canadian economic growth, Riach said Canada’s  inflation backdrop “continues to surprise to the downside” and is now at target levels as leading indicators continue to improve from weak levels. Thus far, Canadians holding mortgages have not yet been impacted by higher interest rates, based on the cumulative share of mortgages outstanding in February 2022 that have been subject to a payment increase.

Economic Growth in Europe and Asia. 

European sentiment is improving but remains at weak levels while Asian manufacturing “has started to fall,” he said. Economic growth in China remains weak: “Consumer sentiment has yet to recover from deteriorating property sector and labor market imbalances.”

Addressing Emerging Markets ex China, Riach said weakening leading manufacturing indicators will “challenge upside potential of cyclical regions broadly.”

In the United States, AI-related stocks (Artificial Intelligence) continue to power U.S. earnings growth expectations. However, Riach said, “this has been broadening to the ‘forgotten 493’ somewhat.” (i.e. away from the Mag 7.)

 

Inflation much improved

Worldwide, inflation is much improved and is now below Central Bank targets, Riach said.

 

Asset Allocation

Moving to recommended portfolio positioning, Franklin Templeton is overweight equities, underweight bonds and neutral on Cash. Within stocks, it is overweight Canadian and U.S. equities, Underweight EAFE (Europe Australasia and Far East) and Neutral on Emerging Markets.

The second major presentation was delivered by Jeff Schulze, Head of Economic and Market Strategy for Franklin Templeton’s ClearBridge Investments. Schulze [pictured on right] is known for his “Anatomy of a Recession” analytical work, which assesses 12 variables that historically foreshadow recession.

However, as the chart below shows, the recession dashboard is currently signalling expansion rather than recession:

 

Addressing employment, Schulze said that while the pace of job creation has slowed substantially over the past few years, “it has settled in line with the pace experienced during the previous economic expansion.” As a result, U.S. consumer spending is robust.
Continue Reading…

3 Key Rules help make you a more successful Conservative Investor

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Conservative investors: Follow our three-part Successful Investor if you want to maximize your portfolio returns with the least amount of risk

Pixabay: Gerd Altmann

The surest way for conservative investors to make money in stocks is to start out by following our three Successful Investor rules for sound investing. They are the foundation of our Successful Investor system.

The first of these three Successful Investor rules is to invest mainly in well-established, profitable, dividend-paying companies. This rule goes first because it’s a simple and effective way of controlling the risk in your portfolio. Needless to say, that control is especially important when you have retired and you depend on your investments for income.

If a stock lacks one of these signs of investment quality, it may be riskier than you realize, yet still offer long-term potential. If it lacks two of the three, it exposes you to above-average risk and is suitable mainly for aggressive investors. If it lacks all three, it’s a high-risk speculation.

If you want to buy stocks missing all three of these qualifiers, it’s best to do so only with money you can afford to lose.

Avoid the urge to diversify into junior or riskier stock groups, just because they might offer the possibility of bigger gains. Stick with stocks that leave you feeling comfortable.

Diversification across sectors is also key for conservative investors

The second rule for conservative investors in our system is to spread your investments out across most if not all of the five main economic sectors: Manufacturing & Industry; Resources & Commodities; Consumer; Finance; and Utilities.

When you follow this rule, you are taking note of the fact that a large random element is at work throughout the financial universe.

When you spread your holdings out like this, you diversify in a way that helps you avoid overloading yourself with stocks that are about to slump.

Unpredictable slumps may be due to weak industry conditions, changes in investor fashion, or other random factors. That’s a bigger risk if you concentrate your stock holdings in one or two of the five main sectors.

Simply staying aware of the concept of diversification can put you ahead of inexperienced investors who take a casual approach. But, beware of half-hearted diversification. It can hurt your investment results, rather than help.

For instance, beginners may zero in on investments that seem to have huge growth potential. Today’s examples might include concept stocks that focus on lithium mining, say, or AI (artificial intelligence), or cryptocurrency. If you disregard our first Successful Investor rule (see above), you’ll mainly wind up buying high-risk speculations that pay off sporadically at best. Continue Reading…

Must-Read Finance Ebooks that teach Gen Z How to Plan for the Future

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Image by Pexels

By Jack Andrews

For Financial Independence Hub

A recent study by Experian highlighted a troubling financial knowledge gap among Americans, especially younger generations.

Out of 2,000 adults surveyed, three out of five admitted that they have made expensive financial mistakes due to insufficient knowledge of credit and personal finance. Gen Z, in particular, faces significant challenges: 71% of respondents from this age group acknowledged that poor financial literacy has led to financial setbacks. Of these, 29% reported losses of $5,000 or more. These statistics underscore the urgent need for accessible and effective financial education.

Despite the evident need, a disconnect persists between the demand for financial education and its availability. While 78% of adults believe personal finance courses should be mandatory in high schools, only 25 states currently require such classes. This lack of structured education leaves many young people unprepared for essential financial responsibilities.

Gen Z is eager to learn about personal finance

However, there is hope: Gen Z is eager to bridge this knowledge gap. According to the same study, 80% of Gen Zers express a strong desire to improve their financial understanding, demonstrating a willingness to take charge of their financial futures.

The good news is that there’s a wealth of information available right at their fingertips. For example, there’s recently been an influx of reputable personal finance gurus sharing their knowledge on social media platforms. Former Wall Street trader-turned-financial influencer Vivian Tu is one of them. Known as Your Rich BFF on Instagram and TikTok, Tu has amassed over six million followers across her socials where she shares financial advice in the hopes of helping people live better, fuller financial lives. In addition to being a full-time content creator, Tu hosts a podcast called Networth and Chill and has written a bestselling book on all things related to personal finance.

 

Tu is far from being the only finance guru with a book worth reading. On Everand, you can find a plethora of personal finance ebooks that can help build your knowledge and your net worth. You can think about subscribing to this digital library as an investment. For an affordable monthly fee, you can access ebooks written by experts like David M. Rubenstein’s How to Invest and Steven A. Silbiger’s Retire Early?. So, if you’re ready to take charge of your financial freedom, here’s a list of the best finance ebooks to help you plan for the future:

How to Invest by David M. Rubenstein

 

Investing is one of the most effective ways to achieve financial independence, with a Youth & Money poll revealing that 63% of young adults believe the stock market is a great avenue for building wealth. Yet, many Gen Zers are not actively investing, often citing high living expenses or a lack of knowledge as barriers. This is where David M. Rubenstein’s How to Invest proves invaluable.

Rubenstein’s ebook is a deep dive into the principles of successful investing. Drawing on insights from some of the world’s most accomplished investors, the ebook provides readers with actionable strategies for navigating the financial markets. Whether you’re a novice or a seasoned investor, How to Invest delivers timeless wisdom and practical advice that can transform the way you approach investing. With Rubenstein’s guidance, young investors can gain the confidence and knowledge needed to grow their wealth.

Retire Early? Make the SMART Choices: Take It Now or Later? by Steven A. Silbiger

While Gen Z is proactive about managing immediate financial responsibilities, such as paying bills and budgeting, long-term financial planning often takes a backseat. According to a Newsweek report, 53% of Gen Zers have not yet contributed to a 401(k) or retirement plan, and 49% lack life insurance. These statistics highlight the importance of early retirement planning—an area expertly addressed in Steven A. Silbiger’s Retire Early? Make the SMART Choices. Continue Reading…

Strategies for Building a Substantial 401(k) Balance

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Retirement planning may not be at the forefront of every twenty or thirty-something’s mind. However, starting early could mean the difference between a retirement spent in comfort or want. With social security’s uncertain future and the rising cost of living, the sooner you embark on saving for retirement, the better. Managing your retirement savings wisely will ensure a peaceful and fructiferous future. Learn the strategies now for building a substantial 401(k) balance [United States.]

Image by Adobe Stock/ juliasudnitskaya

By Dan Coconate

Special to Financial Independence Hub

Today, a robust 401(k) plan is more crucial than ever for securing your retirement. Understanding how to manage your contributions and investments effectively can set you on the path to Financial Independence. As the traditional employer-sponsored pension system becomes less common, individuals are increasingly responsible for their retirement savings.

By taking advantage of employer contributions, understanding investment options, and reviewing your plan, you can cultivate a retirement savings strategy that prepares you for the future and helps you build financial confidence. These strategies for building a substantial 401(k) balance will ensure it becomes a strong pillar of your retirement portfolio.

Choose the Right Investment Options

Most 401(k) plans offer various investment options, and selecting the right mix can directly impact your retirement savings. Investments fall primarily into stocks, bonds, and mutual funds or ETFs, all carrying different risk levels and potential returns. A balanced portfolio that reflects your risk tolerance, investment timeline, and financial goals can better weather market fluctuations. Review your options regularly and consider rebalancing your portfolio to adapt to any changes in the market or your personal situation.

Gradually increase Contributions

If you’re hesitant about contributing a significant portion of your salary to your 401(k) from the outset, consider implementing a gradual increase plan. Many employers allow you to set up automatic annual increases in your contribution percentage. Taking advantage of raises or bonuses to boost your contributions ensures that you consistently increase your savings without feeling the financial strain of a sudden change.

Regularly Review your Plan

Conducting annual reviews of your 401(k) to ensure it remains aligned with your financial objectives is vital. Life changes, such as starting a family or changing careers, can shift your needs and goals, requiring adjustments to your retirement strategy. Continue Reading…