Shoppers leave a retail store in downtown Chicago, Ill. On Saturday, May 22, 2021. For consumers who shop on Memorial Day this year, a large portion of those purchases will be done online, as opposed to inside a physical store. But no matter where you shop on the holiday weekend, there are plenty of ways to save money, including making a list ahead of time, budgeting, and spreading your research. on a variety of stores.
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Google researchers were curious about their retirement options in 2020, with “What is a 401 (k)?” as the 10th most searched financial planning question of the year. In 2020, 401 (k) accounts saw an increase in contributions, with the average IRA balance reaching $ 128,100, 11% higher than the average balance of $ 115,400 in 2019, according to a Fidelity study.
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Last year, Google users wanted to make sure they understood how a 401 (k) differs from an Individual Retirement Account (IRA). In 2020 alone, the number of IRAs receiving contributions increased by 35%, according to Fidelity research.
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People also wanted to familiarize themselves with tax forms during the pandemic. Search “What is a 1099-R?” ranked 8th on Google’s list of top financial planning questions for 2020. A 1099-R form lists each person to whom an individual has paid $ 10 or more from a profit-sharing plan or retirement as an IRA.
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Another of the most searched financial questions last year was: “What is a SEP IRA?” A Simplified Employee Pension (SEP) IRA allows business owners to create their own individual retirement or annuity accounts, while contributing to those of their employees. A SEP IRA follows the same investment and distribution rules as a traditional IRA.
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Google users were determined to get the most out of their retirement savings in the tumultuous year of 2020. The maximum contribution for 401 (k) s in 2020 increased from $ 19,500 to $ 19,000 in 2019 This increase applied to 401 (k), 403 (b), most 457 plans and the Federal Government Savings Plan. Catch-up contribution limits were also lowered from $ 6,000 to $ 6,500 last year.
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Continuing the trend of planning for the future, “How much should I save for retirement?” came up as the # 5 most searched question. While advice on how much someone should save for retirement can vary, it is best to base it on your current age, your desired retirement age, and how much income you would like to earn each month once you are in retirement. retirement, according to Merrill Lynch. .
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Google users were also curious about their health coverage options in 2020. Health savings accounts (HSAs) can be especially great for people because you can contribute even when you’re not working. The Becoming Health Savings Account mutual fund found that during the year 2020, HSA asset growth increased 25% year over year in assets held and in accounts. Health savings increased 6% to over 30 million total accounts for the period ending December 31, 2020.
During the pandemic, Google users considered tapping into their retirement savings to protect their finances. The CARES law, passed in March 2020, removed the 10% penalty for early withdrawals from retirement accounts for anyone under the age of 59 and a half. A Fidelity study showed that between March 2020 and January 2021, approximately 1.6 million people withdrew savings from their 401 (k) plans under the CARES Act.
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Some Google users wanted to know how much time they were going to have to devote 40 hours a week to regular work. When to retire is an individual decision based on many factors, including age, financial situation and career prospects. The US Census Bureau notes that the average retirement age in the United States is 65, but a 2008 study by the bureau noted that people can choose to work beyond retirement age. due to the high cost of health care and the increase in life expectancy as well as their mental and social well-being.
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The first financial question people Google searched for in 2020 was, “How much do I need to retire?” According to the finance and investing website Don’t Quit Your Day Job, the median retirement savings for 2020 was $ 6,450.00 per household, with people 65 and over saving between $ 25,000 and $ 320,000 per household. housework.
Last Memorial Day, Americans were stunned by the pandemic, recession and widespread closures.
Many had bought hand sanitizer and brain tissue.
But in May, life seems to blossom again before the unofficial start of summer.
And more typically Memorial Day, the weekend leading up to May 31 will be filled with sales of appliances, clothing and travel, as well as a few new categories. Here’s where to find deals and how to save.
SOME OLD, SOME NEW NORMALS
Retailers have a few must-have product categories for Memorial Day. The day is traditionally marked with substantial discounts on household items such as laundry appliances, kitchen appliances and mattresses.
This will be true again this year, and some promotions have already started. But in 2021 in particular, some of the sales will also be targeted at activities that are of interest to Americans during the ongoing pandemic and the gradual reopening. Think backyard barbecues, socially remote camping trips, and home improvement projects.
“We’re going to be shopping for clothes because we’ll see more people this summer than last summer,” says Barbara Stewart, professor and coordinator of retail and consumer science at the University of Houston.
“I think consumers are also willing to travel because we’ve been home for over a year,” she says.
Add road travel supplies, car maintenance, camping gear, hotel rooms, and airline tickets to the Memorial Day markdown list.
After all, businesses can access word searches to see what consumers are looking for online. Retailers often align their sales with trending categories and in turn encourage spending, says Priya Raghubir, Dean Abraham L. Gitlow, professor of commerce at the New York University Stern School of Business.
“What really gets people past that last category interest threshold to, ‘Here’s my credit card. Load it up, “is a financial incentive like a prize promotion,” she said.
These types of Memorial Day sales will take place both online and in stores, but don’t expect malls to be as crowded as they once were.
“I still think the online trend is going to continue,” says Raghubir. “There are still hesitations about being inside.”
1. BRAINSTORM BEFORE BUSINESS
Whether you are heading to a physical or virtual store, there are at least three guaranteed ways to save money Memorial Day.
First, before you start to sift through sales, make a list of the things you know you want to buy. This way, the scope of your search is not influenced by the products you see.
“Make a list now when you’re in a cool frame of mind about things that might interest you if they go on sale, rather than building that list based on what’s on sale,” Raghubir says.
If the products you want to buy are not listed for sale, avoid buying products that were not on your list just to fill the buying void.
2. TRY ALL TYPES OF STORES
Then, when you start browsing sales ads and websites, keep your options – and your browser tabs – open.
Memorial Day sales are the bread and butter of big box stores, department stores, mattress stores, home improvement stores, and travel agencies. But you’ll also find savings at less obvious outlets, such as dollar stores, according to Stewart.
Low-budget retailers may be especially suitable for products that you’ll only use for a limited time, such as pool toys that you’ll throw away at the end of the season anyway.
3. DON’T FORGET YOUR BUDGET
As with any shopping excursion, set a limit on how much you’re willing to (and able to) comfortably spend over the holiday weekend. A budget can contain any potential impulse expense.
“Know what you can spend and don’t go overboard,” says Stewart. “There is no good deal worth getting into financial trouble. The product must have real value for you. “
If you’re having trouble sticking to a certain amount, try changing your payment strategy.
For example, Raghubir says she puts money aside in her PayPal or Venmo account as a forced budgeting technique before shopping. Of course, she could spend more than what’s in those accounts, but having a limit gives her a reason to stop spending. It also works as a mechanism to track how much she has spent so far.
Memorial Day offers a chance to honor the fallen service members of the United States. But with a little restraint and discretion, vacations can also offer much-needed savings opportunities.