Retiring on $2,300 each Month

Retirement is a time of frugality for many, since other than Social Security and pension payments, many folks don't have much money coming in. If you're not rooted to a specific location, you are free to move to where the living comes cheaply, like the 10 small towns on this list.

For this study, GOBankingRates considered small towns with populations of less than 30,000 where you can retire on a budget of $2,300 or less, using data from ApartmentList June 2022. 

We also used Sperling's Best to find the cost of living index for every city on the list and data from the Bureau of Labor Statistics' 2020 Consumer Expenditure Survey. 

We then added monthly housing, grocery and healthcare costs together to find where a person 65 and older could get by on the $2,300 budget.

Equally important was a city's livability score -- the cities on this list had to have a score of 65 or higher as sourced from AreaVibes. When all was said and done, three states dominated the list.   READ MORE...

Recession Proof Industries

Warnings about a looming recession have reached a fever pitch. Inflation continues to soar, causing chaos in the stock market, and companies are starting to prepare for the worst with layoffs, hiring freezes and, in some extreme cases, rescinding job offers.

The sudden shift in labor market dynamics — after months of strong job prospects and rising wages for employees — has left many working Americans scratching their heads.

“Job prospects are going to get much worse” in the next few months, Laurence Ball, an economics professor at Johns Hopkins University, tells CNBC Make It. “The question is: ‘How much worse?’”

If you’re thinking of changing roles soon, you should know that while no job is completely recession-proof, certain industries tend to fare worse than others during a downturn.

During the Great Recession, which lasted from 2007 to 2009, the construction and manufacturing sectors experienced sizable dips in employment, according to data from the Bureau of Labor Statistics.

That’s because during an economic downturn, people usually limit their discretionary spending and delay big purchases, including cars and new homes, says Karen Dynan, an economics professor at Harvard University and former chief economist at the U.S. Treasury. She predicts that these industries will see similar patterns if a recession were to occur soon.  READ MORE...

What is Inflation?

How do you measure inflation?

Statistical agencies start by collecting the prices of a very large number of goods and services. In the case of households, they create a “basket” of goods and services that reflects the items consumed by households. The basket does not contain every good or service, but the basket is meant to be a good representation of both the types of items and the quantities of items households typically consume.

Agencies use the basket to construct a price index. First, they determine the current value of the basket by calculating how much the basket would cost at today’s prices (multiplying each item’s quantity by its price today and summing up). Next, they determine the value of the basket by calculating how much the basket would cost in a base period (multiplying each item’s quantity by its base period price). The price index is then calculated as the ratio of the value of the basket at today’s prices to the value at the base period prices. 

There is an equivalent but sometimes more convenient formulation to construct a price index that assigns relative weights to the prices of items in the basket. In the case of a price index for consumers, statistical agencies derive the relative weights from consumers’ expenditure patterns using information from consumer surveys and business surveys. We provide more details on how a price index is constructed and discuss the two primary measures of consumer prices—the consumer price index (CPI) and the personal consumption expenditures (PCE) price index—in the Consumer Price Data section.

A price index does not provide a measure of inflation—it provides a measure of the general price level compared with a base year. Inflation refers to the growth rate (percentage change) of a price index. To calculate the rate of inflation, the statistical agencies compare the value of the index over some period in time to the value of the index at another time, such as month to month, which gives a monthly rate of inflation; quarter to quarter, which gives a quarterly rate; or year to year, which gives an annual rate.

In the United States, the statistical agencies that measure inflation include the Bureau of Economic Analysis (BEA) and the Bureau of Labor Statistics (BLS).

Why are there so many different price indexes and measures of inflation?
Different groups typically care about the price changes of some items more than others. For example, households are particularly interested in the prices of items they consume, such as food, utilities, and gasoline, while commercial companies are more concerned with the prices of inputs used in production, like the costs of raw materials (coal and crude oil), intermediate products (flour and steel), and machinery. Consequently, a large number of price indexes have been developed to monitor developments in different segments of an economy.

The most broad-based price index is the GDP deflator, as it tracks the level of prices related to spending on domestically produced goods and services in an economy in a given quarter. The CPI and the PCE price index focus on baskets of goods and services consumed by households. The producer price index (PPI) focuses on selling prices received by domestic producers of goods and services; it includes many prices of items that firms buy from other firms for use in the production process. There are also price indexes for specific items such as food, housing, and energy.

What is "underlying" inflation?
Some price indexes are designed to provide a general overview of the price developments in a broad segment of the economy or at different stages of the production process. Because of their comprehensive coverage, these aggregate (also called “total,” “overall,” or “headline”) price indexes are of considerable interest to policymakers, households, and firms. However, these measures by themselves do not always give the clearest picture of what the “more sustained upward movement in the overall level of prices,” or underlying inflation, happens to be. 

This is because aggregate measures can reflect events that are exerting only a temporary effect on prices. For example, if a hurricane devastates the Florida orange crop, orange prices will be higher for some time. But that higher price will produce only a temporary increase in an aggregate price index and measured inflation. Such limited or temporary effects are sometimes referred to as “noise” in the price data because they can obscure the price changes that are expected to persist over medium-run horizons of several years—the underlying inflation rate.

Underlying inflation is another way of referring to the inflation component that would prevail if the transitory effects or noise could be removed from the price data. From the perspective of a monetary policymaker, it is easy to understand the importance of distinguishing between temporary and more persistent (longer-lasting) movements in inflation. 

If a monetary policymaker viewed a rise in inflation as temporary, then she may decide there is no need to change interest rates, but if she viewed a rise in inflation as persistent, then her recommendation might be to raise interest rates in order to slow the rate of inflation. Consumers and businesses can also benefit from differentiating between temporary and more persistent movements in inflation. For these reasons, a number of alternative measures have been developed to measure underlying inflation.  READ MORE...

Americans Quit Jobs

New York (CNN Business)A record 4.4 million Americans quit their jobs in September as the sheer volume of available jobs is empowering workers to have their pick.

Workers are quitting in search for better pay or better jobs, representing a fundamental shift in America's labor market.

"Labor now has the initiative, and the era of paying individuals less than a livable wage has ended," said Joseph Brusuelas, chief economist at RSM US.

"This strongly suggests that rising wages are going to be part and parcel of the economic landscape going forward."

The nation had 10.4 million open jobs that month as the worker shortage crisis continues, data from the Bureau of Labor Statistics showed Friday. It was a modest decrease from the 10.6 million open jobs in August.

Jobs particularly increased in the health care and sector and in state and local government. "The Delta variant is still visible in the September JOLTS report," said Nick Bunker, director of economic research at the Indeed Hiring Lab, in emailed comments.

But he noted "we do know from the October jobs report that the labor market did get on more stable ground."The slowing demand for workers in the leisure and hospitality industry was the cause of the modest decline in available jobs in September. READ MORE...

Working From Home

With the world discovering alternative ways to work without human contact, the work from home force is getting a facelift. Companies must cope with most non-essential workers completing their work at home. Amidst a pandemic, could your productivity working from home actually be better?

An estimate by Upwork states that 1 in 4 Americans which is over 26% of the American workforce is expected to work remotely through 2021.

Several studies over the past few months show productivity while working remotely from home is better than working in an office setting. On average, those who work from home spend 10 minutes less a day being unproductive, work one more day a week, and are 47% more productive.

In a workweek, those who work at home are more consistent, work more hours, and get more done. Right away, this doesn’t sound right.

How can you be more focused while working at home? Find out how professionals manage to get more done on flexible work arrangements, not in an office setting.
Performance can increase up to 13 percent by working from home

A study by Standford of 16,000 workers over 9 months found that working from home increase productivity by 13%. This increase in performance was due to more calls per minute attributed to a quieter more convenient working environment and working more minutes per shift because of fewer breaks and sick days.

In this same study workers also reported improved work satisfaction, and attrition rates were cut by 50%.

Working Remotely Can Increase Productivity up to 77%
77% of those who work remotely at least a few times per month show increased productivity, with 30% doing more work in less time and 24% doing more work in the same period of time according to a survey by ConnectSolutions.
Before COVID-19

Letting employees work from home has been the fear of plenty of companies because they believe they will be less productive. This isn’t entirely wrong. At home, it’s easy to get distracted, procrastinate, or put in less work than those working in the office.

In 2019, a study by the Bureau of Labor Statistics found that 24% of people that were employed did some or all of their work at home on days they worked, and 82% of people that were employed did some or all of their work at their workplace.  READ MORE

Social Security

This year’s Social Security cost-of-living adjustment was 1.3%, yet many of the costs seniors face are rising much more quickly.  In 2021, the estimated average monthly benefit increased by $20 per month.

Many expenses have dramatically risen in the past year, according to a new analysis of Consumer Price Index data from the Bureau of Labor Statistics done by The Senior Citizens League, a nonpartisan senior group.

From March 2020 to March 2021, the fastest-rising cost was car and truck rentals, which went up by 31.2%. That was followed by laundry equipment, which climbed 24.2%; gasoline, 22.2%; and home heating oil, 20.2%.

Some prices, such as prescription drug and medical costs, stayed constant, although physician services climbed by 5.3%.  Admittedly, all consumers are grappling with those rising price tags, not just seniors. The Senior Citizens League selected the list based on which costs affect retirees most.

Because older Americans often live on a fixed budget, which typically includes Social Security benefits, having to absorb those higher costs can hit them harder.  “With inflation rising so fast, what’s going on right now is an erosion in buying power,” said Mary Johnson, Social Security and Medicare policy analyst at the league.

When measured by the index used to calculate Social Security’s annual cost-of-living adjustment — the Consumer Price Index for Urban Wage Earners and Clerical Workers, or CPI-W — inflation has risen since last year.  The CPI-W was more than 3% higher as of the end of March than it was a year ago.  TO READ MORE, CLICK HERE...