3 Smart Money Moves To Build Wealth During Uncertain Times
While most people would love to have solid finances and secure their long- term financial future, the reality is very different at the moment with 57% of Americans living to paycheck according to a recent MarketWatch report. And, according to a recent Gallop survey, 53% of Americans are now concerned about their financial future, - the highest level recorded since Gallop began tracking this data in 2001.
Here are three things that you can implement if you're looking to get a stronger hold on your finances and build wealth despite these challenging times.
Young family with cute little baby boy going over finances at home
Tracking your spending over the next 30 days can improve your financial health. It can also allow you to pinpoint areas where expenses can be reduced. Common budget drains include unused subscriptions, avoidable fees and charges such credit card interest, overpaying on utilities, cable, phone plans. Apps like Rocket Money and Trim can help you identify and manage unused subscriptions and negotiate bills. Additionally, apps like Empower, You Need a Budget (YNAB), and Monarch can help you take a close look at your expenses and identify where you can reduce your expenses and redirect those savings towards your wealth building goals. You can even take it a step further and budget every dollar to minimize unintentional spending and increase savings.
While aggressively paying off debt can contribute to your peace of mind, there are times when a dual approach— paying off debt while also investing in your future— makes better financial sense. If your debt carries an interest rate below 7%, it may be wiser to make regular required payments towards your debt while investing the difference.
Historically, the stock market has returned between 7 and 10 % annually and provides a way to build significant wealth over the long-term rather than simply being debt-free or having a zero net worth.
Also, prioritizing having an emergency fund of at least six months of living expenses can provide a financial cushion that is crucial in these challenging times. And passing up opportunities such as an employer 401K match or investment opportunities during market downturns to solely focus on getting out of debt can be detrimental to your financial future.
Additionally, it's important to start investing by using tax-advantages accounts like 401Ks, 403bs, IRAs to ensure that you are minimizing your tax burden, which will in turn give you more money to invest and provide a bigger opportunity to build wealth.
In many cases, investing the difference between your required low interest debt payments and any remaining funds can make a huge difference in your long-term wealth.
A couple of young businessmen are astounded by the profits coming in.
The S&P 500 dropped by 4.84% on April 3rd, 2025, and by another 5.97% on April 4th, 2025, This year, we witnessed the sharpest declines in the S&P 500 and NASDQ since the COVID-19 crash. Yet by mid-May 2025, the market had rebounded and had regained all its April losses.
This pattern shows why it is important to continue to invest even during market downturns, when the market can provide opportunities to buy quality investments at lower prices.
This year, we are likely to see more volatility in the market, but that doesn't mean you should step back. It's extremely difficult to time the market. That's why it's wise to dollar cost average into good companies, it will pay off in the long run.
Asset allocation dividing an investment portfolio among different asset categories.
Diversifying your investments is important in any economic environment, but it's even more important during periods of high market volatility like what we've experienced so far in 2025. For instance, if all your money was invested in Nvidia prior to March 31st, your portfolio would have experienced a drop of 14.7% during those same two highly volatile days of April 2025. In contrast, if your money was spread across a total market ETF like VTI or a VOO, your portfolio would have temporarily declined — by 10.3 and 10.7%, a less severe drop.
Diversifying your investments and including low-cost index funds as part of your investment strategy is always wise. If a recession were to hit, no one could predict which stock will thrive 15 years from now —but 100 year of history shows that the broader market tends to recover and grow over time by 7 to 10 % every year on average. By spreading your investments across the market, and into alternative assets like real estate, you can reduce risk, manage volatility, and build a solid path to long-term wealth.
Regardless of your current situation is, it's beneficial to closely examine your spending to reduce waste, implement a debt repayment strategy that also optimizes wealth building, and review your investment approach to put enough emphasis on diversification.
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Yahoo
an hour ago
- Yahoo
A judge blocked a rule to drop medical debt from credit reports. What now?
A recent federal court ruling overturned a Biden-era ban on medical debt in credit reports just as access to healthcare and health insurance is becoming more fragile. The decision could thwart the hopes of an estimated 15 million Americans who might have seen some relief ahead of expected hikes to healthcare premiums, the end of enhanced marketplace subsidies, and an anticipated increase in the number of Americans without insurance. 'We're really concerned that with the loss of insurance altogether, or healthcare becoming more expensive, we're just going to see more medical debt,' said Mona Shah, the senior director of policy and strategy at Community Catalyst, a national nonprofit healthcare advocacy organization. 'With this protection removed around credit reporting, it's going to impact people's overall economic well-being and ability to thrive.' A $49 billion reversal Earlier this month, a federal judge blocked a rule from the Consumer Financial Protection Bureau (CFPB), which had never taken effect, that would have stopped medical bills from appearing on credit reports and barred lenders from using such data to make lending decisions. The CFPB estimated the change could raise impacted consumers' credit scores by an average of 20 points. Healthcare providers typically don't report missed medical bills directly to credit bureaus, according to Equifax, so medical debt often doesn't wind up on a credit report until it's been reported to a collections agency. However, two trade associations successfully argued that the CFPB had overstepped its authority. Under the Trump administration, the CFPB also asked for the rule to be thrown out. In a July 11 ruling, Judge Sean Jordan of the US District Court for the Eastern District of Texas agreed with the trade groups. The ruling comes at an especially precarious time in healthcare. The tax bill signed into law by President Trump this month is expected to leave 10 million Americans without health insurance by 2034, largely due to changes in Medicaid. Meanwhile, enhanced premium tax credits that helped make Affordable Care Act marketplace coverage more affordable will expire at the end of this year after they were not extended in the tax bill, a change that will help contribute to the largest premium increases seen in years in 2026. The end of the subsidies is expected to leave an estimated 4.2 million people uninsured. 'Having more people lose Medicaid and become uninsured, and also lower-income adults losing subsidized marketplace coverage and becoming uninsured, is going to significantly increase medical debt,' said Fredric Blavin, a senior fellow and researcher at the Urban Institute, a Washington-based think tank. Under the Biden administration, the CFPB estimated that removing medical bill information could have wiped $49 billion off the credit reports of about 15 million Americans, noting that medical billing information often contained errors and was a poor predictor of a consumer's creditworthiness. Lower credit scores can damage a person's ability to rent a home, obtain a credit card with a favorable rate, and even impact their job search. In public comments supporting the rule, many Americans shared stories of how medical bills had weighed on their credit, including cancer patients, people who had been in car wrecks, and more. Read more: How are credit scores calculated? Sign up for the Mind Your Money weekly newsletter By subscribing, you are agreeing to Yahoo's Terms and Privacy Policy What should consumers do now? Credit reporting agencies had already voluntarily decided in April 2023 to wipe medical collection debt from consumer credit reports if the balance was below $500. A year earlier, paid medical collection debt was also dropped from credit reports, and consumers were given one year to pay down medical collection debt before it started appearing on their credit reports, rather than six months. Additionally, the CFPB noted that FICO and VantageScore had previously both 'decreased the degree to which medical bills impact a consumer's score.' These combined changes dropped medical debt in collections from most consumers' credit reports, the Urban Institute found, leaving about 4.1% of adults with such data on their records in August 2024, down from 12.6% in February 2022. Additionally, 14 states have provisions in place to remove medical collection debt from credit reports. 'We expect more states to take the same initiative moving forward,' said Breno Braga, a senior fellow and researcher at the Urban Institute. 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Business Insider
2 hours ago
- Business Insider
America's next big land grab
There's a weird contradiction happening at the base level of America's real estate market. Faced with high borrowing costs and an uncertain economy, homebuilders — the engines of the country's housing supply — are cutting prices and tacking on freebies in an effort to keep sales moving. At the same time, they're also staking out huge swaths of land in anticipation of the next homebuilding boom. The land grab is a signal of faith in the long-term demand for housing, a bet that the sluggish market will turn around, and a recognition of the country's deep housing shortage. It could also end up paying huge dividends for regular homebuyers. Whether these bets pay off, and whether Americans see the benefits, will depend on a little-known breed of investor known as a "land banker." These companies scoop up construction-ready land on behalf of builders (for a fee, of course) and then hang tight, biding their time until their patron is ready to put shovels in the ground. The setup allows builders to "control" land for years before technically owning it, preserving a pipeline of new developments and freeing up cash to, you know, actually build more houses. In recent years, builders big and small have latched onto this maneuver. There's no clear data on the prevalence of this model since land bankers are, by and large, private companies, but investors are most likely setting aside tens of billions of dollars' worth of home lots at builders' behest. In the second quarter of this year alone, Lennar, one of the largest homebuilders in the country, bought nearly 22,000 lots from land bankers for a whopping $2.7 billion. The typical buyer doesn't know — or care — about these exchanges, which take place long before the foundation is poured. But the rise of land banking will play a significant role in the efforts to chip away at our nation's housing shortage. Real estate is cyclical, which means periods of strong homebuilding activity are often followed by a retreat when the economy takes a turn for the worse. Land banking could help builders quickly ramp up production after these soft periods, delivering homes the moment more Americans are ready to take the homeownership plunge. The result would be a more reliable homebuilding machine, and maybe even cheaper houses. For buyers in the near future, that's great news. At risk of stating the obvious, land is the most valuable commodity in real estate. As the aphorism, usually attributed to Mark Twain, goes: "Buy land, they're not making it anymore." Even with unsettled economic conditions and a weak spring selling season, competition for prime acreage remains stiff. It usually takes years to turn a vacant parcel into a single-family home, so builders need a steady pipeline of land to keep their businesses moving. Traditionally, they've taken on short-term loans to buy up lots and get them shovel-ready. But this method of grabbing land comes with some downsides. Money tied up paying for idle land could be put to better use. It's also risky: If the costs of readying that land for construction go up, or if the market slows down and it's not profitable to keep churning out homes, builders are left on the hook. The answer to this conundrum is what builders call a "land-light strategy." Instead of buying up land outright and holding it until they sell the finished homes, they bring in a land banker to purchase construction-ready lots and then pay that investor for the option to build on those lots at a later date. The builder will typically put down a nonrefundable deposit of between 10% and 20% of the land's value and work out a schedule for buying those lots from the land banker sometime in the future, usually two to four years down the road. Without a land banker, a typical land purchase might require a builder to put down, say, 35% of the total value and get a loan for the rest. They'd also have to keep up with pesky line items like taxes and maintenance on the lots. A 10% deposit, on the other hand, allows builders to claim more land with less risk and fewer dollars. That's an especially attractive option for big, publicly traded homebuilders whose financials are scrutinized every quarter by Wall Street. Publicly traded homebuilders have employed this strategy to dramatically expand their land holdings since the onset of the COVID-19 pandemic. In the first quarter of this year, they either owned or controlled nearly 2.4 million lots, up from roughly 1.4 million lots at the same point in 2020, an analysis by John Burns Research and Consulting found. Back in 2017, public builders owned about 64% of their lots and optioned the remaining 36%. Those figures have flipped in the years since. 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This leaves builders to focus on what they do best: managing the construction process and selling those homes to consumers. We like to joke about a seven-year cycle and a three-year memory. But I do think the GFC scars ran deep Greg Vogel, CEO of Land Advisors Organization It's not just land bankers who have evolved, though — the entire homebuilding industry has shifted over the past couple of decades. While the size of the current land-buying spree is substantial, it's still far less frenzied than in the years leading up to the global financial crisis in 2008, when builders were hoovering up land the old-fashioned way: using traditional debt to buy the properties outright. Builders absorbed a brutal lesson back then. First, they were stuck with too much land that was suddenly a lot less valuable when the bubble burst. A bunch of builders went belly-up or were forced to offload lots at low prices. Then the remaining builders were forced to play catch-up and seek out more land when housing demand rebounded. The mistakes of that era were a crystallization of the short-term thinking that so often screws over people in the real estate industry. "We like to joke about a seven-year cycle and a three-year memory," says Greg Vogel, the CEO of Land Advisors Organization, a land brokerage firm based in Scottsdale, Arizona. "But I do think the GFC scars ran deep." Land banking, on the other hand, offers a measure of safety and predictability for homebuilders, allowing them to lay claim to home lots without assuming all that risk. Even when the economy hits the skids and builders slow down production, they can rework deals with the land bankers rather than walk away from their land positions altogether. "They learned last time that they're in a much worse position having to go scramble and find land when the market did come back," Katie Hubbard, an executive at Walton Global, tells me. That kind of flexibility will come in handy as homebuilders weather another rough spot. The spring selling season, when builders typically move the bulk of their inventory, was "hugely disappointing," Jody Kahn, the senior vice president of research surveys at John Burns, tells me. Prices for new homes during the typical selling season would be up 4% to 6% from the previous year — John Burns' recent survey of builders indicates that prices dropped in June by about 1.5% year over year. Other data is similarly disheartening for developers: There haven't been this many new homes sitting on the market since the summer of 2009, data from the Department of Housing and Urban Development shows. Roughly 119,000 new homes were available for sale in May, more than triple the number at the same point in 2022. That glut of new homes may help consumers to some degree. 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Builders felt the pain after the housing market collapsed in 2008, but so did millennials, who were starting to reach their prime homebuying years right as home construction waned in the aftermath of the Great Recession. That case of bad timing has plagued them throughout their adult lives. In the 2010s, builders started work on just 21,000 single-family homes per 1 million people, compared with a rate of more than 41,000 homes in each of the three decades prior. With fewer homes reaching completion and more people trying to climb onto the housing ladder, price spikes were inevitable. While home prices rose about 46% in the 2010s, compared with about 31% in the 1990s, the problem really came into focus during the pandemic frenzy. Home prices jumped more than 50% between the spring of 2020 and the same point this year, even as builders played catch-up to try to meet the wave of demand from millennials. "It's not an easy machine to turn on and off," says Will Frank, a land-banking expert at John Burns. The true benefits of land bankers in this housing cycle are, admittedly, still a bit theoretical. This is the first time that builders and the current crop of land-banking partners are wading through a slowdown in the market, and it could still be a while before we see construction roar back. There's also the open question of just how big a discount could end up in the final sale price thanks to land bankers. After all, these investors are just one piece of the chain that transforms raw land into homes, since they're usually not the ones navigating the red tape of local permitting or doing the early legwork to get the lots ready for construction. The land developers who handle that part of the process play a vital role in shaping the housing supply years into the future. But land bankers have already aided builders in vastly expanding their land holdings to get ready for demand that may arrive years in the future. "There are deals that just wouldn't get done without a land banker," says Chase Emmerson, a partner at a land-investment firm in Arizona. And while they may not be the cure-all for the cyclical nature of the housing market, they will most likely help builders get their shovels into the ground more quickly when housing demand ramps up. In soft markets, builders can kick the can down the road and work out deals with these investors to delay some of the land purchases until sunnier times. Neither the builders nor the land bankers want those deals to fall through entirely. And when demand inevitably comes back, builders will be poised to respond with the land in their back pockets.
New York Post
3 hours ago
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Billionaire LA Times owner announces he's taking the newspaper public
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