I don’t think we’ve ever had a situation like this where on paper, the economy should be crumbling and yet it’s still standing! Kinda stronger than ever. Minus a long-awaited recession. No one’s complaining there (apart from maybe the economists who put together the forecasts).

Wanna know why it’s holding up? Thanks to the consumer aka us out spending like no tomorrow. Not just spending on fancy choc and festive clothing but on way bigger things. 

Forget that, we’re now turning to things like cruises and concerts. I mean, these famous singers only need to be in a city for a couple hours and they’re already causing inflation thanks to hyped demand and fans flocking from across the world! Swiftenomics might just become a thing if we carry on like this! 

Black Friday ‘23 turned out to be rather cheerful! 

You’d think that with all this going on, Black Friday sales would struggle like mad. Well guess what, US shoppers spent $9.8bn on online shopping alone. They spent another $12.4bn on Cyber Mon which was almost 10% higher than the previous year. When interest rates were just a fraction of what they are now!

Makes zero sense.

Q3 GDP grew by 4.9% and I kid you not, this was down to all you shoppers! Since consumer spending makes up ~70% of GDP in the US, the consumer is critical for the success of the US economy. 

I’ve been following the credit card companies quite closely. From Amex (up 13.5% this month btw!) to Mastercard to Visa they’re not seeing spending slowdowns. Quite the opposite, actually. But here’s 3 tips to keep your wallet in shape as spending season is well and truly underway!

Here’s a great summary produced by mastercard to give you some insight into our shopping habits this season taking a look at what’s in our basket – only if you’re curious! You can also see if your spending style tallies up or if you’re totally different! 

Big ticket items? No savings? YOLO! 

What totally interested me was the fact that we aren’t afraid to spend on big-ticket experiences. We’re laying out a ton of cash to do it. We aren’t thinking of our 2024 self (which is legit rolling around as we speak) but we’re thinking of our today self.

YOLO, right? 

It’s not just about the immediacy of it all and our inability to wait for things (sure, we find that hard!) but this is now what that is. Our spending psyche has been re-wired. Thanks to a pandemic.

We were forced to spend less. We could shop online and that was fun for a while, until it wasn’t. We couldn’t go to concerts, we couldn’t cruise around the Mediterranean (unless you happened to have a yacht stashed away) nor could we get on a plane and travel.

The only “travel” you got was around your that you probs walked 100000x over and have memorised every single flower or from your bed to your desk. 

It is human nature to want what you can’t (or don’t) have

Case in point: everyone (okay, nearly everyone. I kinda missed it) flocked to the cinema to see Barbie (or Oppenhiemer – depending on which camp you’re in) something which we’d have laughed at a few years back.

Why bother with the cinema when you have Netflix and your couch (and the sheer luxury of being able to chomp on your popcorn as loud as you please). It could be that we’ll only go to cinemas for these big hyped-up releases, but still. It was fab to see.

When you haven’t had something in ages, you crave it. When you’ve had something for ages you crave newness. And newness was actually all the stuff we were busy doing pre-pandemic life but didn’t do enough of or realised we missed it so much.

People missed out on summer vacays, family birthdays and other big milestones. The only way you could share it was on a screen on your iPad. Nothing was in-person for so long. Now, we’re craving to get out there. 

We’re travelling more (experiences > things)

Travelling is one of the things that really made me stop and think, wow, the consumer is actually doing this! People I talk to are talking about their upcoming travel plans or the trips they’ve just taken. Whether that was over thanksgiving or over Xmas.

A colleague of mine went to the Canary islands to do some cycling with a much better view! And she’s already booked her 2nd vacay. Way to go! Friends of mine recently returned form visiting their family over in the Big Apple. I think I saw about 27 snaps of mouth-watering delights from some famous cookie place to cheesecake and all in between. 

There’s been a big shift in our spending habits from spending on things to spending on experiences. The latter is defo winning it here! But in all this, we’re not saying no.

Consumers aren’t thinking about the looming doom and gloom (tech and banking are already laying off people. And before the holidays, how lovely).

We’re not thinking of all that. Clearly. We wanna have a good time. That’s where the YOLO’ing comes in. We’re thinking how to use our money to the max, now, rather than waiting. (Psst: here’s how to master the art of conscious spending to fully enjoy your money while growing it to the max).

The future is about as uncertain as it gets.

Weak consumer = lower spending = weaker growth (until now) 

Economists are probs cursing us consumers. They have no idea what we’re gonna do next. We’ve become so unpredictable (and I kinda like it) 

The real question is why we’ve become so blaze about our spending all of a sudden? Do interest rates not matter to us anymore? Are we no longer worried about our jobs or there something else going on? 

Since covid came along in 2020, it pretty much tore up the consumer playbook. What would have normally happened didn’t. Because, well, none of what’s been going on over the past 3yrs have been anything but normal!

And in recent months the lack of normalcy has escalated. You don’t need me to tell you that. Norms are breaking down. 

We’re spending more because things have become so bad 

Our economies are richer that they’ve ever been and yet we’re no better off. We’re working longer and harder when we should be working shorter. Shouldn’t tech have made things easier for us?

Sure, we can get our pizza delivered to our front door for us to gobble up in our pjs while no one’s looking (all at the tap of a few things) but in the grand scheme of things, it doesn’t feel like we’re better off. Wanna know? We’re having to work a lot longer to buy basic things. That’s inflation for you. 

But inflation wouldn’t have been so bad if our wages actually kept up. Instead, our wages our like that unfit person who doesn’t move off their butts. They stand no chance at any sort of marathon.

And we shouldn’t even be discussing inflation! Tech advancements + innovation are meant to cause deflation. Aka lower prices.

So why hasn’t that happened?

Govs gobbled on debt and “free money”, that’s what. But the problem with free money is that it never is.

I read a stat today that showed the increase in the gov deficit meant that every US household would have received $80k in deficit spending. I bet you no one feels $80k richer. Probs just the opposite! 

People are genuinely fed up with the status-quo. They don’t wanna work till they’re in their 70s only to enjoy a few measly yrs of retirement. The shift is happening. Do these 4 uncomfortable things now to enjoy more money + time later on.

It’s all about planning. And investing your time to get money and using that money to get more of your time back. Schmooze for another day!

YOLO’ing is fab for the economy (not for our pockets) 

If you wanna keep YOLO’ing (life’s too short to do anything but) you gotta get real with yourself. Take some time to plan and think about the sorts of experiences you really want to take. I know that does take the spontaneity outa the equation but it means you get to wait for it – the waiting is part of the fun! 

What’s not-so-fun is when you’re behind on your credit card bill. It’s an easy trap to fall in, especially when we all feel like we need a serious break from, well just life.

But making money moves like that, in the space of a few moments, usually has us to regret it later down the line. Barbados is great; it becomes not-so-great when you’re paying it off for the next 9 months. 

Make a wish-list, of all the experiences you wanna experience next year or over the next 5yrs if you’re a real planner. And then work backwards. Figure out how much $$$ you’ll need. Then start saving. Each month put some money into your YOLO fund. Lol it’s kinda the total opposite but planning never hurt anyone. 

My 2024 defo involves a lot more travelling, sightseeing and exploring new things.

Go out and do whatever it is you want.

Just make sure your wallet can handle it! 

Disclaimer: This blog is not investment or financial advice. It is my opinion only. This blog is not a personal recommendation to buy/sell any security, or to adopt any such investment strategy. Always do your own research before you commit to any investment.