Is Inflation Here to Stay?

According to the most recent report by the Bureau of Labor Statistics, U.S. inflation is currently running at a 13-year high of 5.4%, and it’s showing no signs of slowing. Here’s what to know about the current state of the U.S. economy and what you can likely expect in the coming months.

Inflation is not going anywhere soon

Rising prices in just about every sector is the new norm. The inflation rate fell at the start of the coronavirus pandemic, and during the nationwide lockdown as people hunkered down at home. In March 2021, though, when the impact of halted manufacturing began hitting the market and crude oil prices started climbing, the inflation rate increased to 2.6% before hitting its current high of 5.4% in June and July. Although the rate started falling in August to 5.3%, it went back up to 5.4% in September. Experts, like the Trading Economics information technology company, now expect that number to continue rising, probably hitting 5.5% in the coming months.

Unfortunately for the average consumer who’s struggling to cover expenses amid rising costs, this means inflation isn’t going anywhere soon.

Why are prices so high?

There are several factors for the inflation bubble. First, suppliers are still catching up on production shortages that were caused by factory shutdowns during the pandemic. Second, climate disasters, like California wildfires and a drought in Brazil, are responsible for driving up prices in the food industry. The demand for higher wages, partially caused by the 10.4 million job openings in the U.S., and the rising cost of gas, are contributing to inflation as well.

What can consumers expect in 2022?

While no one can accurately predict the future, economists are expecting inflation levels to taper off by the middle of 2022. According to a survey conducted by the Wall Street Journal, many are expecting inflation to drop to 3.4% by June 2022 and to continue falling until it hits 1.8% by the end of the year.

PLEASE NOTE: The statistics and estimates supplied in this article were sourced via the hyperlinked references throughout the blog, and not by High Point Federal Credit Union.

How to Save on Wedding Costs

Did you know the average U.S. wedding costs $28,000*? That’s a lot of money to spend on one event!

But it doesn’t have to be this way. Here’s how you can have the wedding of your desire and your budget, too.

Choose your top priority

Most couples-to-be have some fantastical dreams about their wedding day. It might be a huge wall of flowers, a custom wedding gown or a wedding aisle fitted with hundreds of floating candles.

Whatever your dream, count on it costing a pretty penny. To avoid going into debt for your special day, choose the one item for your wedding that is most important to you as a couple. That one must have you are willing to get at almost any cost. Trim costs in other places to leave room in your budget for your top priority.

Skip the invites (average cost: $590)

Snail mail is so last millennium. Bring your wedding up to date and make some budget breathing room by creating a cost-free e-invite that includes all the wedding details and the ability to RSVP electronically. You’ll be doing your wallet, and the environment, a favor!

Go nontraditional with the venue (average cost: $10,500)

A typical venue can eat up a wedding budget fast. Make your wedding extra-special and save on costs at the same time by choosing an out-of-the-box venue, like an art gallery, your favorite upscale restaurant or even atop a scenic lookout point.

Ditch the rehearsal dinner (average cost: $1,900)

Why not put that money toward something with lasting value? If you feel like you need a rehearsal to make sure everything goes smoothly, ask the officiator and the members of the wedding party to practice the ceremony with only a short, no-food run-through.

Choose a non-bridal gown (average cost: $1,600)

Everything on your list gets more expensive when you tack on the word “wedding.” Save on one of these expenses by purchasing a gown that’s not designed exclusively for a wedding. Any floor-length white gown from a department store or boutique will do, and you can always add embellishments to dress it up a bit. You’ll still save a fortune.

Limit your guest count (average cost per guest: $70)

So many parts of your wedding, from the catering, to the bar, to the cake, cost more with each added person. Keep your wedding intimate by only inviting guests who really count. You can limit the plus-ones, specify that the reception is adults-only or restrict the guest list to people who are currently in your life, instead of inviting every acquaintance you’ve ever had.

Rethink your cake (average cost: $500)

Consider a shorter or narrower cake for pictures and cutting, and have the caterer serve a frosted sheet cake so there’s enough for all your guests.

5 Steps to Take Before Making a Large Purchase

Bitten by the gotta-have-it bug? It could be a Peloton bike that’s caught your eye, or maybe you want to spring for a new entertainment system? Before you go ahead with the purchase, though, it’s wise to take a step back and follow these steps.

Step 1: Wait it out

Often, a want can seem like a must-have, but that urgency fades when you wait it out. Take a break for a few days before finalizing a big purchase to see if you really want it. For an extra large purchase, you can wait a full week, or even a month. After some time has passed, you may find that you don’t want the item after all.

Step 2: Consider your emotions

Before going ahead with your purchase, take a moment to identify the emotions driving the decision. Is this purchase being used as a means to fix a troubled relationship? Or maybe you’re going through a hard time and you’re using this purchase to help numb the pain. Be honest with yourself and take note of what’s really driving the purchase. Is it really in your best interest?

Step 3: Review your upcoming expenses

What large expenses are you anticipating in the near future? Even if you have the cash in your account to cover this purchase, you may need that money soon for an upcoming expense. Don’t spend money today that you’ll need tomorrow.

Step 4: Find the cheapest source for this item

If you’ve decided you don’t want to go ahead with the purchase, there are still ways to save money. In today’s online world of commerce, comparison-shopping is as easy as a few clicks. You can use apps like ShopSavvy to help you find the retailer selling the item at the best price.

Step 5: Choose your payment method carefully

Cash can be your go-to choice if you have the funds on hand now. A low-interest credit card may offer purchase protection, just make sure you can meet your monthly payments. Finally, a buy now, pay later program can be just what you need if you have 25% of the purchase price saved up and you can afford to pay off the rest in fixed installments.

If you’re ready to make a large purchase and need a loan, contact Olean Area Federal Credit Union to explore your options!

Simple Steps to Start Saving

If you’re ready to start saving but you don’t know where to begin, High Point Federal Credit Union can help.

Let’s get started!

Step 1: Set a goal

What’s your secret (or not-so-secret) financial dream? Do you want to open your own business? Explore the Australian Outback? Buy a boat?

What are your long-term financial goals? Do you want to make your friends jealous and retire before you hit 50? Do you dream of sending your child to college?

Choose your goals and assign a target dollar value to each one.

When you really start saving, first prioritize building an emergency fund that has three to six months of living expenses. Thinking of your bigger personal goals now will help keep you focused.

Step 2: Start tracking your expenses and income

You’re about to turn into one of those budgeting geeks.

For three months, keep a record of your expenses and all income. At the end of the three months, tally up your totals to figure out the average of each.

Step 3: Trim your expenses

If you find that your income exceeds your expenses by a fair amount, give yourself a high-five and skip to the next step.

If you spend more than you earn, or your numbers are too close for comfort, look for ways to trim your expenses, and save that extra cash.

Step 4: Create a budget

Don’t freak out — this isn’t as hard as it sounds. Just take your averages from step 2 and use them to designate a specific dollar amount for each monthly expense. Don’t forget to include savings in your budget!

Step 5: Choose your savings tools

It’s time to choose a place for your savings to call home. For long-term savings, look for an option that offers an attractive earnings rate, like a share certificate at High Point Federal Credit Union.

Keep that emergency fund and other short-term savings in an account that allows you to make withdrawals without asking too many questions, like a checking account at High Point Federal Credit Union.

Step 6: Make it automatic

Is this the first time you decided to start saving? Yeah, we didn’t think so. Make it the time you actually carry out your plans by setting up an automatic monthly transfer from your checking account to your savings account.

Contact High Point FCU to open a Savings Account today!

5 Ways to Trim Your Fixed Expenses

When trying to trim a monthly budget, most people don’t even consider their fixed expenses; however, with just a bit of effort and research, most of these costs can be reduced.

1. Consider a refinance

Trim your mortgage payments by refinancing at a lower interest rate. It will cost a bit, but in some situations you can roll closing costs and other fees into your refinance loan. Plus, the money you save each month should more than offset these costs. A refinance is especially smart in a falling-rates environment or if your credit score has improved a lot.

2. Lower your property taxes

Taxes are inevitable, but you may be able to lower your property taxes by challenging your town’s assessment. Each town will have its own guidelines to follow for this process, but ultimately, you will agree to have your home reappraised for proving that its value is less than the town’s assessment. This move can drastically lower your property tax bill; however, if you have made improvements to your home, it may be appraised at a higher value, which could raise your taxes.

3. Change your auto insurance policy

If you’ve had the same insurance policy for several years, speak to a company representative about lowering your premiums. By highlighting your loyalty and excellent driving record, you may be able to get a lower quote. If your insurance company is not willing to work with you, it might be time to shop around.

4. Consolidate debt

If you have multiple credit cards with outstanding balances, consider a balance transfer. This entails opening a new, no-interest credit card and transferring all debt to it. The no-interest period generally lasts up to 18 months. You will now have just one debt payment to make each month. Plus, the no-interest feature means you can make a serious dent in paying down that debt without half of your payment going toward interest.

Another way to consolidate debt is to take out a personal loan at High Point Federal Credit Union. Our personal loans will allow you to pay off all of your credit card debt at once. You’ll only need to make a single, affordable monthly payment until your loan is paid off. Explore our current rates here.

5. Cut out subscriptions you don’t need

Take some time to review your monthly subscriptions to weed out those you don’t really need.

If you’re paying for a gym membership, consider just paying for classes you attend instead of the full membership, or springing for your favorite workout machine to use at home. Drop your cable service or downgrade to a cheaper plan by cutting out expensive channels you don’t watch often. Also, you might be paying for premium versions of apps you don’t need. Dropping these costs can give you more wiggle room in your monthly budget.

How to Create a Budget in 6 Easy Steps

If you’re always wondering how you’re going to pay the next bill, feel guilty when you indulge in overpriced treats and you just can’t find money to put into savings, you might need to create a budget.

A budget will help you gain financial awareness, which will help facilitate more responsible decisions.

Here are 6 easy steps to create a budget:

Step 1: Gather your financial information

Collect all your financial documents and receipts for three consecutive months. This includes all account statements, bills, pay stubs, receipts and more.

Step 2: Tally up your totals

Divide your documents into expenses and income. Then, list the corresponding numbers on a spreadsheet. As you work through these lists, include occasional and seasonal expenses, dividing their totals by 12 to spread them evenly throughout the year.

When you have your numbers, take a look at how they match up. If your expenses outweigh your income, trim your spending and/or look for ways to boost income.

Step 3: List all your needs

Take a look at how you’ve spent your money in the recorded time and identify all the actual needs. This includes fixed expenses like mortgage/rent payments, savings, insurance premiums and car payments; as well as fluctuating but necessary expenses, like groceries. To keep it simpler, list your fixed expenses first, followed by your non-fixed expenses.

As you list each need, write down its corresponding cost. When you’ve finished creating this list, add up the total.

Step 4: List your wants

Your next step is listing the stuff you love but can really live without. Include entertainment costs here, as well as eating out and expensive hobbies.

Here too, jot down the monthly cost of each item and tally up the total when you’re done.

Step 5: Assign dollar amounts to expenses

Open up a new spreadsheet, and copy your list of expenses, starting with the fixed-cost needs, then your non-fixed-cost needs, and finally your wants.

Next, assign a specific dollar amount to each expense category. If your budget allows, you can use the average amount you’ve spent in each category for the last three months to set the cap for that expense.

Continue until every dollar is accounted for and you have enough money in your budget to cover each need, want and occasional expense. If expenses outweigh income, you’ll need to trim some expenses for your budget to work.

Going forward, be sure to spend only the assigned amounts for each expense category.

Step 6: Review and adjust as necessary

Review your budget monthly to see if you’re staying on track. If you consistently overspend in a category, spend less in a different area so you have more money available to meet your needs.