🦃 Let's dish
As merrymakers gather ’round this Thanksgiving, we’d be wise to eye the oven: There are more house fires* on Turkey Day than any other of the year – putting that average annual homeowners insurance coverage of $2,417.10* to good use.
If it’s not burnt, foodies may happily help themselves to seconds: The average price of turkey is down 22% from last year* to about $1.27 per pound. That leaves more dough to buy the pie: 59% of our readers told us in last week’s poll that they’re willing to spend bigger for a holiday and aren’t trimming their meal budget.
Next week, we’ll pause The Currency™ newsletter for celebrations. In the meantime, let’s feast on this week’s financial news.– The Editors
🎈Full of hot air: Speaking of traditions, 50 million Americans* tune in for the Macy’s Thanksgiving Day Parade while prepping for the year’s biggest meal. In New York City, close to 4 million people line the streets to watch the parade pass in person and see its larger-than-life balloon characters standing as high as six stories. This year, there will be 3,000 balloon handlers (most of whom are Macy’s employees), as it takes about 90 people to walk each balloon down the street. Experts estimate the total cost for the parade floats around $13 million.
🎁 First taste of the gift-buying season: After giving thanks, consumers have their choice of shopping options spanning Black Friday to Small Business Saturday to Cyber Monday. Sales have commenced,* though time will tell if consumer appetite will top last year's record-setting $9.12 billion* Black Friday online sales.
🍽️ Inflation served cool: Price worries among U.S. consumers rose to the highest level in 12 years,* with costs anticipated to climb at an annual rate of 3.2% over the next five to 10 years, up from 3% a month earlier. Inflation cooled in October*, taking the heat off the Fed to hike rates.
💵 Loosening the bracket squeeze: To address the impacts of inflation, the Internal Revenue Service (IRS) introduced a 5.4% bump* in income thresholds to reach each new federal income tax bracket. The IRS makes annual adjustments to prevent “bracket creep” – a side effect of higher inflation without accounting for any real boost in buying power. Though lower than last year's historical 7%, the increase is still greater than years without inflation.
Holiday hiring isn’t giving like last year
Traditionally, the hustle and bustle of the holidays is good for job seekers, but there’s a slowdown that may be signaling a labor market downshift.
This fall, the number of seasonal positions publicly advertised fell to the lowest level in a decade. The National Retail Federation (NRF) estimates that between 345,000 to 445,000 seasonal workers* will be hired this year, down as much as 40% from 2021’s record high.
After a summer spending splurge, economists project that consumers may pull back in the final months of 2023: The NRF expects seasonal spend to grow 3% to 4%, which is down from a 5.4% increase in holiday sales last year and a 12.7% jump in 2021.
It is a stark turn from recent holiday seasons, when companies found it difficult to hire enough workers, especially for temporary and in-person positions.
Knock, knock: Relief on the home front
Following a steady incline for most of the year, dips in rent prices and mortgage rates may provide reason for (measured) celebration among renters and prospective buyers.
As for renters, apartment developments in some of the fastest-growing cities are causing prices to drop.* Boise City, Idaho, for instance, has seen rents settle down by over 6% this past year as the supply of apartments increased by more than 5%. Other metro areas nationwide (like Austin, Phoenix and Atlanta) have upped their inventories by as much as 5.6%.
Meanwhile, mortgage rates recently took the biggest week-over-week dip* in more than a year, from 7.86% to 7.61% for a 30-year fixed-rate mortgage. Most current homeowners carry mortgages with rates below 4%.*
Given elevated interest rates, those wishing to be homebuyers for the holidays may want to consider leveraging a mortgage buydown, which allows buyers to purchase with temporarily lower interest rates at an upfront cost.
The makings of multigenerational moisturizer
Beauty brands are betting on the up-and-coming wallet share of young consumers (and their parents) as Gen Alpha gets in on skincare.*
Mass appeal for skincare products surged during the pandemic when at-home workers ditched makeup and leaned into self-care. It’s a trend that’s continued: As of September, skincare spending is up 14% compared with the same period a year ago. Teens shelled out an average of $122 this fall, for a 19% year-over-year increase.*
Nearly 30% of Americans believe they overspend on everyday luxuries, per Empower research, though only 21% of surveyed adults say they splurge on skincare.
Though facial products may be among the variable, nonessential expenses in your budget, mindful shopping can create space: Spend on what you love, save on what you don’t.
As of November 16, 2023, EAG does not hold shares of Macy's Inc (M) in advisory client accounts.
*Third-party data is obtained from sources believed to be reliable; however, Empower cannot guarantee the accuracy, timeliness, completeness, or fitness of this data for any particular purpose. Third-party links are provided solely as a convenience and do not imply an affiliation, endorsement, responsibility, or approval by Empower of the contents on such third-party websites.
The content contained in this blog post is intended for general informational purposes only and is not meant to constitute legal, tax, accounting or investment advice. You should consult a qualified legal or tax professional regarding your specific situation. No part of this blog, nor the links contained therein is a solicitation or offer to sell securities. Compensation for freelance contributions not to exceed $1,250. Third-party data is obtained from sources believed to be reliable; however, Empower cannot guarantee the accuracy, timeliness, completeness or fitness of this data for any particular purpose. Third-party links are provided solely as a convenience and do not imply an affiliation, endorsement or approval by Empower of the contents on such third-party websites.
Certain sections of this blog may contain forward-looking statements that are based on our reasonable expectations, estimates, projections and assumptions. Past performance is not a guarantee of future return, nor is it indicative of future performance. Investing involves risk. The value of your investment will fluctuate and you may lose money.
Certified Financial Planner Board of Standards Inc. (CFP Board) owns the certification marks CFP®, CERTIFIED FINANCIAL PLANNER™, CFP® (with plaque design), and CFP® (with flame design) in the U.S., which it authorizes use of by individuals who successfully complete CFP Board's initial and ongoing certification requirements.
Advisory services are provided for a fee by Empower Advisory Group, LLC (“EAG”). EAG is a registered investment adviser with the Securities and Exchange Commission (“SEC”) and subsidiary of Empower Annuity Insurance Company of America. Registration does not imply a certain level of skill or training.