This Week In Your Wallet: Are We Done With The Five Day Office Week?

This Week In Your Wallet:
Are We Done With The Five Day Office Week?

Kazakhstan, Colombia, Spain, France and…wait for it… the United States. What do these countries have in common? They all received a C+ in a recent, worldwide retirement ranking by the Mercer CFA Institute Global Pension Index. The grade, as the Wall Street Journal reports, is not only slightly lower than a year ago, it puts us in 22nd place out of 47 countries. Yes, 22nd. I hope that landed with a disappointing thud. (It certainly did to me.)

The U.S. retirement model, as the report notes, has significant deficiencies, especially when compared to other countries. “Employers in the U.S. aren’t required to provide retirement plans to all workers,” writes Oyin Adedoyin for the WSJ. “Automatic enrollment in 401(k) plans has helped improve participation and boosted total retirement savings. But many Americans don’t have access to a 401(k) or choose not to put money into individual retirement accounts on their own.” The report also notes that when it comes to gig and blue collar workers, our retirement system is lacking. Also holding the U.S. back from a higher ranking is the growing concern over Social Security’s future, as the program’s reserves are projected to dry up by 2033.

What country is at the top of the list, you might ask? That’s the Netherlands, a place where all workers have both private and public pension accounts. “There is a public pension that provides a flat rate to all retirees depending on how long they have lived and worked in the country,” writes Adedoyin. “Then there is a semi-mandatory requirement for employers to provide all workers with a pension. Additionally, individuals can contribute to their eventual retirement income with their own investments.”

Spending Stalls For Gen Z

On the other end of the spectrum, a new report shows that members of Gen Z–those born between 1996 and 2010–are buckling down when it comes to spending. As CNBC reports, nearly 3 in 4 young adults are spending less due to inflation, according to a recent Bank of America study. In an effort to cut back, those surveyed say they’re cooking at home more (43%), spending less on clothing (40%) and when they head to the grocery store, are focusing on just getting the essentials (33%).

The good news is that according to the survey, most feel they can continue to manage their day-to-day expenses. The bad news? They aren’t as confident in their ability to save for a rainy day, put money away for their retirement years, or invest…and their timing couldn’t be worse. “This is really the time to build a solid foundation that is going to allow you to be successful throughout the many next decades of your financial life,” Douglas Boneparth, a certified financial planner and president of Bone Fide Wealth in New York, tells CNBC.

So what can Gen Z do? First, get in the habit of saving. It goes without saying that every little bit helps. Second, start planning for how you’ll fund your retirement. Lastly, try your best to let go of FOMO. The Bank of America survey found that Gen Z women feel increasingly pressured to keep up with the lifestyles of their peers. 41% of women (as opposed to just 24% of men) said their social media feeds make them wish they had more money to splurge. In fact, the 2023 Everyday Wealth In America survey from Edelman Financial Engines (which sponsors the HerMoney podcast) revealed that among people who spend more than three hours a day on social media, more than half say they’ve spent more than they could afford on something — as a direct result. “Your friends are not posting their net worth on Instagram and TikTok, so be wary that people may not be doing as well as they appear on social media,” Ted Jenkin, a CFP and CEO of oXYGen Financial in Atlanta told CNBC.

Workers Are Done With The 5 Day Office Week…Or Are They?

Love it or hate it (though I think most love it), remote work is here to stay. That’s according to Nicholas Bloom, a professor of economics at Stanford University, who writes in the New York Times that lately, there’s been a significant drop in the number of Americans swiping electronic cards to enter their offices. “This month, occupancy rates were at 50 percent of February 2020 levels,” writes Bloom. “That is shocking — only half as many days are spent in the office compared with pre-pandemic times.”

On the flip side, though, data from the U.S. Census Bureau shows that the number of Americans working from home has continued to decline since 2021. Today, 26 percent of U.S. households have someone working from home at least one day per week. As Bloomberg reports, the data fluctuates significantly from state to state. For example, in Colorado, 38% of households have someone working from home. In states like Mississippi and Louisiana though, rates of households with a remote worker have been cut in half, due in large part to many of the available jobs not having a remote option, like those in the manufacturing, oil and gas industries.

What will the future bring when it comes to remote work? Bloom predicts that in 10 years remote work will increase due to two factors. First, technology. As the rate of progress in this sector continues to increase, companies will be able to develop even better tech that makes remote work easier and more efficient. The second has to do with companies being born in this new era of remote work. “Today’s new companies have nearly twice as many days worked from home as those founded 20 years ago,” writes Bloom. “As these young companies grow and mature, they will turn into tomorrow’s medium and large companies, bringing their remote-friendly practices with them.”

Spooky Szn Spending Breaks Records

Halloween is less than a week away and this year, we’re expected to see record spending to the tune of $12.2 billion, topping 2022’s record of $10.6 billion according to the National Retail Federation (NRF). The biggest chunk of that $12.2 billion will be spent on costumes, which is expected to total a record $4.1 billion. The NRF also broke down what costumes are most popular this year…the list includes witches, vampires, Barbie (surprise surprise) and Batman.

If you’re planning to dress up for the upcoming festivities and are still without a costume, don’t fret, NPR’s got you. Marielle Segarra, a reporter for NPR, recently sat down with “regular people stylist” Sophie Strauss to put together a guide for those wanting a clever, low-cost and sustainably sourced costume. For those looking to cut costs, Strauss recommends looking in your closet for inspiration, or the closet of a friend who has a very different style than your own. “If you're trying to put together a costume with a disco cowboy theme, you might source a cowboy hat from one friend and a sparkly top and a bolo tie from another,” she suggests.

One thing you shouldn’t do is spend money you don’t have to. Instead, head to a thrift store, or identify a costume that can be made up of “new real clothes” that you’ll wear again in the future. Another tip is to search for secondhand versions of those pre-made costumes online, on sites like Poshmark or eBay. “The absolute last thing you should do is buy a new costume,” says Strauss.

Have a great week,

Jean

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