Recently, Yahoo! Finance published an article from Forbes that listed 10 quirky economic indicators. Things like, a spike in the sale of lipstick when the economy is in a slump, or a decline in the sale of disposable diapers during the financial crisis that began in 2008. It's interesting to see how the state of the economy can drive spending trends in such a transparent way.
After looking at our finances, I was able to identify several trends in our own spending that follow the rise and fall of the economy. Here are a few financial trends I've noticed in my family that are based on our view of the economy.
Like many women, I love to buy new clothes. In fact, I purchased new pieces every month from July 2012 through January 2013. Then, my husband's net pay went down due to the end of the payroll tax holiday, and gas prices began to rise again. Once it became clear that changes in the economy meant we would have less to spend I stopped buying clothes. Not because we could no longer afford them, but because I fear what other changes are ahead of us.
Replacing furniture pieces
Before the recession's wrath was unleashed on Americans, I had a very different idea of how I would decorate my home. My husband and I were just starting out, and had an apartment full of secondhand furniture that I planned to replace as soon as possible with new pieces. The recession put a stop to that, and since that time I have learned to appreciate secondhand items to the point that I actually look for ways to work them into my home's decor.
Increasing our savings contributions
Savings contributions are a part of our everyday budget. Each week a portion of my husband's salary is deposited into our savings account, as well as a percentage of the money I save while shopping. However, I have noticed when prices rise and the economy slows down, I feel the need to save even more. In fact, gas prices recently increased to close to $4 a gallon, and without even thinking about it, I increased our saving contributions by $50 bi-weekly.
It's now clear to me that I have a tendency favor saving when the economy isn't doing well, and I'm positive that will work on my family's favor if things do go badly.
While the changes in our spending and savings habits aren't as the quirky economic indicators Forbes listed in their article, they definitely speak to how we view the overall economy.
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