When it comes to spending money, there are the needs in life, and then there are the wants. Of course, when it comes to essentials, you need to shell out for a roof over your head, food, healthcare, WiFi, and other essentials. But those enticing wants can open up a world of fun purchases, dining out, travel, and other discretionary expenses.
What is the definition of a discretionary expense? It’s a non-essential outlay of cash. Examples are any spending that is not required or that is driven by individual preference (say, a brand new fully loaded Bronco vs. a used minivan). They’re optional things that you can choose to spend money on or not. Think of upgrading to a new phone because the camera is cooler or deciding to head to the beach for a long weekend. Those are discretionary, for sure.
Digging into the difference between discretionary and essential spending can help you understand and optimize your spending and your budgeting.
Because discretionary expenses are unnecessary, they can be a good place to trim one’s budget and find more funds to use elsewhere. Read on to learn more about these costs and how to manage them.
So, how can someone identify discretionary expenses? To do so, it can be helpful to take a step back and consider what a necessary expense is.
Needs are more or less mandatory or unavoidable. For example, housing expenses, like mortgage payments or rent, are things a person can’t do without.
Most workers have to pay federal and state taxes on their work income. People with outstanding debt are generally expected to make monthly payments. And, in everyday life, food (aka groceries) and fuel (aka gas or public transit) are typically must-haves.
Some of these necessary expenses will still be variable, changing every month. For example, an electricity bill may go up and down depending on how much time is spent at home and the season of the year.
However, the wants of life (or what some people may call the fun stuff) are those expenses paid from your discretionary income. They reflect the goods and services that may not be vital for survival but that people frequently spend money on.
What are discretionary expenses exactly? Here’s a list of some common ones to consider.
• Eating out: Your everyday meals are a necessity, but when you grab a pricey green juice to go, take a seat at the sushi bar, or join friends for drinks on a Friday, those are discretionary expenses.
• Grooming services: Soap and shampoo may be musts, but massages, manis, facials, and the like are luxuries. Same goes for sending your furbaby to the doggie spa.
• Entertainment: Concerts, movies, comedy shows, and plays can be wonderful experiences. Though you may argue that Taylor Swift or Beyonce tickets are necessary for survival, these are discretionary spending in truth.
• Media: Books, streaming platforms, magazines, and the like are also discretionary expenses.
• Subscription boxes: Do you have wonderful things turn up on your doorstep regularly as part of a subscription? Whether makeup samples or snacks of the world, these don’t count as needs but wants.
• Gifts: Sure, you love treating your nearest and dearest, but splashing out on gifts is optional and therefore a “want,” not a need. Same for holiday trappings, like that high-priced chocolate pecan pie from your favorite bakery.
• Travel: While the “I need a vacation” sentiment runs strong, taking a trip is considered a discretionary expense.
• Clothing: Some clothing (such as items you wear to work) may be rightly considered needs, but when you buy cute shoes on sale just because, well, they are so cute, that is a “want.”
Are you seeing a pattern here? Any expenses beyond core costs are considered discretionary; it’s a matter of needs vs wants. Typically, discretionary costs reflect wants. They aren’t needed for a person to function in day-to-day life. Rather, they have more to do with lifestyle.
Broadly, discretionary expenses could include vacations, entertainment, luxury items, eating out in restaurants, and electronic gadgets.
Exactly what constitutes a discretionary expense isn’t always cut and dry. As with any personal choice, there’s likely a significant element of subjectivity.
• As mentioned above, while food is generally thought of as a necessary expense, some types of eating are actually discretionary. Eating at restaurants is avoidable and often more expensive than making food at home. Buying luxury ingredients at the grocery store (ahem, imported cheeses) can be more costly than sticking to pantry staples.
• Similarly, clothing, in many instances, is a necessary expense. If a person lives in a cold climate, owning an insulated winter coat is a legitimate need. (Without one, the person could risk their health or well-being).
Still, there’s tons of variation in the price of winter coats. Choosing to buy a utilitarian coat often costs much less than buying a designer jacket.
Even within the categories of essential expenses, individuals can exercise their discretion to save money.
💡 Quick Tip: Don’t think too hard about your money. Automate your budgeting, saving, and spending with SoFi’s seamless and secure online banking app.
Tracking discretionary expenses is key in case times get tough or a person wants to make a budget or tighten theirs up. When planning for future financial goals, like saving up for a mortgage down payment, finding places to pare back can add up.
Tracking discretionary expenses can help with making or paring back budgets.
One of the most important strategies for tracking discretionary spending is creating a household budget. Budgeting may help individuals to ensure there’s enough money to cover necessary expenses and bills. Once those needs are covered, it’s possible then to set the remaining money aside for discretionary spending.
Consider these reasons why budgeting for expenses can benefit you:
• Avoid overspending: When you have a budget, you have guardrails. You know how much money you have coming in and how it’s allotted. You know that if you spend too much, you could wind up with high-interest credit card debt, which can be challenging to pay down.
• Paying off debt: With a budget for your expenses, you can likely rein in spending and focus on putting dollars toward wiping out high-interest debt.
• Saving for your future: If you follow a budget and don’t go overboard with discretionary spending, you can likely funnel funds toward important short- and long-term goals, such as buying a house or paying for your child’s college education.
To start building a monthly household budget, tally up total monthly income after taxes. Be sure to include all sources of income, such as:
• Salary
• Any money made from freelance or side gigs
• Passive earnings, such as rental property income or dividends.
Next, a would-be budgeter might want to write down all necessary expenses and add up their associated costs. Some regular expenses could vary from month to month. So, it might be helpful to go back and look at costs incurred every month during the last year. This way, it’s easier to average the amounts that get spent on X, Y, and Z essential costs.
Whenever budgeting, it’s important to determine whether incoming money can cover both regular and surprise costs. Ideally, an individual would have enough money saved or in income to pay for all necessary expenses.
On top of short-term expenses, some budgeters like to allot amounts each month either to savings or to a rainy day fund (you’ll learn more about the actual amount in a minute). With some money management accounts or retirement plans, users can directly deduct funds from a paycheck on payday.
Automating savings might cut the temptation to shop, as these funds are already transferred to another vault or account (and, hence, harder to spend).
If money isn’t being auto-saved, budgets can be updated to include savings under the discretionary fund category. Over time, as savings grow, squirreled away funds could go toward pursuing long-term financial goals, such as a home down payment, starting a kid’s college fund, or investing for retirement.
Once essential expenses have been budgeted for, a list of discretionary spending costs can be drafted. This can cover broad categories that might include trips, entertainment, savings, or eating out.
When either income drops or the cost of a necessary expense goes up, it can be necessary to update one’s budget accordingly. Making cuts to discretionary expenses may be one place to find more cash.
Budgeters could rank, for instance, their discretionary spending according to what’s least or most important. A food lover, for instance, might want to allot more to dining out than an avid skier.
With discretionary expenses prioritized and mapped out, it can be easier to tighten a budget, identifying easier-to-cut-back-on items.
There are a variety of different budgeting methods. And, some are particularly suited to tracking discretionary spending. Here’s a look at common budgeting strategies:
The 50/30/20 rule was popularized by Elizabeth Warren and Amelia Warren Tyagi in their book All Your Worth. The idea behind this strategy is that monthly income is divided proportionally between three categories:
• 50% goes to essentials, or needs
• 30% goes to discretionary spending, or wants
• 20% goes to savings.
This strategy prioritizes savings, removing it from the category of discretionary spending and making sure it’s part of every month’s budget. This budgeting strategy takes a broad view and can be good for people who are easily overwhelmed by tracking details.
For those who love to dive into the nitty-gritty details of spending habits, line-item budgeting might be a better fit. Line-item budgeting can involve breaking out a spreadsheet, examining expenses in fine-toothed detail.
For example, rather than simply having a broad category for all groceries, a line-item budget could break down how much gets spent on buying meat, vegetables, dairy, bread, prepared foods, and coffee. Naturally, the more details that are tracked, the more information a budgeter has on exactly where their money is going.
Line-item budgeting can show the nitty-gritty of personal spending habits.
There may even be pockets of “essential” spending — for instance, the types of groceries being bought — that could be pared back. Rather than helping a person to allocate funds, a line-item budget focuses on tracking spending.
It can also help people to compare their spending habits over extended time periods, such as a month or a year.
Making comparisons in this way can help keep spending in line with previous months. Because line-item budgeting is a spending tracking system, it doesn’t necessarily help build toward goals, like savings or retirement. It’s not designed to cut costs.
Envelope budgeting can be a useful way to track discretionary spending for two reasons: 1) It’s tangible, and 2) it’s strict.
When using the envelope method, a person writes down their discretionary spending categories on individual paper envelopes. Next, they decide how much they’re willing to spend in each category.
To limit the urge to spend beyond the budget, only the allotted amount is placed as cash in each envelope. Afterwards, just the cash in that envelope is used to make purchases within that category of expenses. The idea is to train oneself to avoid using debt or credit cards, which can encourage impulse spending.
And here’s the rub: Once the cash within a given envelope has run out, it’s gone. You could borrow from another envelope if that has some available cash. But most envelope budgeters strive not to spend beyond the predetermined funds.
So, if the entertainment fund has run dry, then it’s Netflix at home instead of going out to the movie theater. And, if a person blows through their eating-out budget, it could be fun to do a refrigerator sweep. Often, a tasty meal can be whipped up with groceries that have already been purchased.
Though this budgeting approach may sound harsh, it can provide stricter guardrails that help individuals to spend within their means.
For some, adopting this “tougher” approach to budgeting can help reinforce tighter spending habits.
Zero-based budgeting is another way to track spending. The idea behind this budgeting strategy is that every dollar of income has a designated role and can be assigned as an expense. In this way, one’s income minus expenses equals zero.
Zero-based budgeting can take a little bit of extra work, since individuals would need to sit down at the start of each month to assign exact dollar amounts to necessary expenses, discretionary expenses, savings, and other costs.
With zero-based budgeting, the goal is to stick within the dollar amount assigned to each expense. Budgeters seek to stop spending in each category when the allotted dollar amount gets spent.
Still, it may not always be possible to avoid running over the anticipated budget. In those cases, the amount spent in excess of the budget could be subtracted from discretionary funds in the next month. Or perhaps the budgeter may want to allocate more funds in the future for discretionary categories.
💡 Quick Tip: If you’re faced with debt and wondering which kind to pay off first, it can be smart to prioritize high-interest debt first. For many people, this means their credit card debt, so try to eliminate that ASAP.
One part of adopting a budget is finding a tracking system that works for the long haul. So, when figuring how to track spending, it can be helpful to go with the approach that fits individuals’ financial goals and habits.
Online budget tracking tools are one way to help make sense of spending. There are plenty on the market, and your bank may well have tools for this purpose.
Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.
Better banking is here with up to 4.50% APY on SoFi Checking and Savings.
Clothing can be a discretionary expense if it’s not a necessity, such as a warm winter coat or basic clothes to wear to work. When you buy something just because you like it but don’t need it, that’s a discretionary expense.
Examples of discretionary expenses include travel, entertainment, and eating out.
Non-discretionary expenses are typically the needs or musts of basic life, such as housing and utilities, food, healthcare, transportation, and minimum debt payments.
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Source: sofi.com
Mike On The Money: Paying off student loans, credit interest, and mortgage rates
THE MONEY. WE WELCOME MIKE GIORDANO, FINANCIAL ADVISOR WITH WILLIAMS WEALTH MANAGEMENT AND A NEW DADDY OF BEAUTIFUL MARGOT. WE SHOWED YOU THE PICTURE LAST WEEK. SHE WAS VERY APPRECIATIVE TO MAKE HER DEBUT. SHE’S LIKE, WOW. JANE KNOWS SHE LOOKS STUNNING. AND YOUR WIFE LOOKED LIKE NOT EVEN 24 HOURS LATER. BUT WE’RE SO EXCITED ABOUT YOUR FAMILY. SO TODAY WE WANT TO TALK ABOUT STAYING A STEP AHEAD BECAUSE YOU’VE GOT THREE LITTLE ONES LIKE MIKE DOES. YOU KNOW HOW TO STAY A STEP AHEAD, PAYING BACK STUDENT LOANS. LET’S START THERE, MIKE, BECAUSE STARTING IN SEPTEMBER, PEOPLE WHO HAD HAD THOSE LOANS DEFERRED BECAUSE OF COVID ARE GOING TO HAVE TO START PAYING IT BACK. HOW DO THEY MAKE PLANS NOW TO HAVE RE BUDGET? YEAH, WELL, THE BEST THING TO DO IS START FOCUSING ON THAT NOW. START THINKING ABOUT HOW CAN I, HOW CAN I SET ASIDE THE MONEY THAT I’M GOING TO NEED? SAY YOU NEED $200 FOR THOSE PAYMENTS, START FIGURING OUT HOW YOU’RE GOING TO GET THAT $200 RIGHT NOW, IF YOU CAN SKIMP OUT ON SOME EXPENSES, THEN THAT’S THE PERFECT WAY TO GO. MAYBE YOU CAN FIND A WAY TO RAISE YOUR INCOME. THAT’S ANOTHER THING. SO THE BEST THING TO DO, THOUGH, IS FIND A WAY TO MAKE UP THE MONEY SO YOU CAN MAKE THE NORMAL PAYMENTS. IF FOR SOME REASON YOU CAN’T MAKE NORMAL PAYMENTS, THERE ARE A WHOLE BUNCH OF INCOME BASED PAYMENT PROGRAMS THAT ARE MORE PEGGED TO YOUR INCOME. SO THE PAYMENTS MAY BE LOWER EARLIER AND THEN THEY GO HIGHER LATER, BUT YOU MAY END UP PAYING MORE INTEREST OVER TIME. SO IT’S A GREAT FALLBACK OPTION, BUT THE BEST THING TO DO IS BE ABLE TO MAKE NORMAL PAYMENTS. GREAT. AND JUST GET IT DONE. ABSOLUTELY. I MEAN, IT’S VERY MUCH LIKE IF YOU HAVE A CAR, YOU PAID OFF YOUR CAR FOR A LITTLE PERIOD OF TIME. YOU DIDN’T HAVE ANY PAYMENTS, BUT THEN ALL OF A SUDDEN YOU WANT A NEW CAR, YOU GOT TO START BUDGETING FOR THAT STUFF. THAT’S GREAT ADVICE TO STAY IN AHEAD OF THE CAR THING. WHAT ABOUT INFLATION? WE’RE TAKING A LOOK AT EVERYTHING HAPPENING WITH INFLATION. EVERYTHING COSTS MORE, INCLUDING WHAT I’M PAYING ON CREDIT CARD. DO I PAY OFF MY CREDIT CARD OR DO I SAVE MONEY? OR IS THERE A WAY TO DO BOTH? THERE’S A WAY TO DO BOTH FOR SURE. THE BEST THING TO DO IS THAT WHEN YOU THINK ABOUT PAYING OFF CREDIT CARDS, ANYTHING THAT’S DOUBLE DIGIT INTEREST OR HIGH SINGLE DIGIT INTEREST, THOSE ARE THE THINGS YOU WANT TO PAY OFF AS QUICKLY AS POSSIBLE. IF YOU’VE GOT ALL THAT, IF YOU DON’T HAVE ANY OF THAT KIND OF DEBT, THEN YOU CAN START LOOKING AT AT PUTTING MORE MONEY INTO SAVINGS. AND WHEN YOU’RE TAKING A LOOK AT TRYING TO COUNTER INFLATION OVER THE LONG TERM, THE BEST WAY TO COUNTER INFLATION ARE GROWTH ASSETS LIKE STOCKS, REAL ESTATE THAT WAY TO A LESSER EXTENT LONG TERM BONDS. BUT IN THE SHORT TERM, IF YOU CAN’T HANDLE ANY PRICE VOLATILITY BECAUSE YOU NEED THE MONEY OVER THE NEXT YEAR OR TWO, THEN YOU WANT TO LOOK AT THOSE HIGH YIELD SAVINGS ACCOUNTS OR MONEY MARKET FUNDS IN A BROKERAGE ACCOUNT BECAUSE THEY’RE PAYING UPPER FOURS 5% INTEREST, WHICH IS BETTER RIGHT NOW THAN THE 3% INFLATION RATE. YEAH, AND THAT’S GREAT TO KNOW, TOO. NOT ALL SAVINGS ACCOUNTS ARE CREATED EQUAL, SO REALLY MAKE SURE THEY AREN’T. SO MAKE SURE YOU’RE LOOKING AT WHAT YOU’RE GETTING PAID. OKAY. SOME PEOPLE WANT TO BUY A HOUSE. MORTGAGE RATES ARE THE HIGHEST THEY’VE BEEN IN A REALLY LONG TIME. HOW DO YOU EVEN BEGIN THIS? LOOK AT THIS 30 RATE, 30 YEAR FIXED RATE, 7.37. WHAT DO WE GO FOR IT? OR DO YOU HOLD OUT AND WAIT TO BUY THE HOUSE? WELL, IT DEPENDS. YOU WANT TO KEEP YOUR YOUR FIXED COSTS UNDER 50% OF WHAT YOU’RE MAKING, RIGHT. AND REALLY DEBTS YOU WANT TO BE UNDER ABOUT A THIRD OF WHAT YOU’RE MAKING. SO THAT’S THE FIRST THING. SO THAT’S HOW YOU MAINTAIN A FINANCIAL RESPONSIBILITY IN TERMS OF THE INTEREST RATES AND ALL THAT STUFF. THE BEST THING TO DO IS IF YOU CAN SOMEHOW SAVE A LITTLE BIT MORE MONEY AND GET A BIGGER DOWN PAYMENT, THEN THERE’S LESS MONEY FOR YOU TO HAVE TO BORROW. IT DEPENDS ON WHAT KIND OF HOUSE YOU’RE LOOKING TO BUY, TOO. IF YOU’RE LOOKING TO BUY A NEW HOME, NEW CONSTRUCTION, THERE’S A LOT OF BUILDERS THAT HAVE PROGRAMS THAT WILL BUY DOWN SOME OF THAT FINANCING COST AND ON THE FRONT END FOR THE FIRST FEW YEARS. AND THEN HOPEFULLY IF RATES FALL BACK DOWN, THEN YOU CAN REFINANCE FOR THE LONGER TERM. IF IT’S AN EXISTING HOME, YOU DON’T REALLY HAVE THAT OPTION. AGAIN, YOU’VE GOT OPTIONS, TAKE A LOOK AT IT AND THEN CREDIT RATINGS, WE ALWAYS KIND OF LOOK AT LIKE, IS IT WHAT IS YOUR CREDIT SCORE? SOMETHING THAT CAN SAVE YOU MONEY AT SOME POINT? WELL, JANE, I MEAN, IT DEFINITELY IT DEFINITELY CAN SAVE YOU MONEY. THINK ABOUT IT. IF YOU WERE LENDING MONEY TO A FRIEND, YOU GOT A RELIABLE FRIEND AND AN UNRELIABLE FRIEND WHO ARE YOU GOING TO MAKE THE WHO ARE YOU GOING TO LOAN THE MONEY TO? RIGHT. AND CERTAINLY AND IF YOU’RE WILLING TO LOAN MONEY TO BOTH BECAUSE YOU’RE SUCH A NICE PERSON. YES. YOU’RE GOING TO LEND MORE MONEY TO THE RELIABLE FRIEND THAN THE UNRELIABLE FRIEND. IT’S THE SAME THING. THAT’S WHAT CREDIT SCORES ARE. THE HIGHER YOUR CREDIT SCORE IS, THE MORE RELIABLE YOU ARE TO PAY BACK THE MONEY THAT YOU BORROWED. AND SO IF YOU’RE MORE RELIABLE, YOU’RE GOING TO TYPICALLY GET A BETTER INTEREST RATE AND YOU’RE GOING TO BE ABLE TO BORROW MORE MONEY AND STAY IN AHEAD OF WHAT YOU MIGHT WANT TO BORROW FOR THE FUTURE. MOST IMPORTANT THING, THERE ARE SO MANY FACTORS CREDIT SCORES. BUT THE MOST IMPORTANT THING IS MAKING THOSE PAYMENTS ON TIME. EXCELLENT. MIKE GIORDANO, IT’S ALWAYS GREAT TO B
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Mike On The Money: Paying off student loans, credit interest, and mortgage rates
Mike Giordano with our Jane Robelot discusses paying off student loans, credit interest, mortgage rates, etc.
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Mike Giordano with our Jane Robelot discusses paying off student loans, credit interest, mortgage rates, etc.
Source: wyff4.com
I am a huge fan of simple living and of the do-it-yourself ethic. It’s no surprise then that I am fascinated by homesteading, the lifestyle of “agrarian self-sufficiency”. This article was written for Get Rich Slowly by Phelan, host of A Homesteading Neophyte, a blog about learning to homestead. Phelan is a regular commenter to this site.
Modern homesteading is a great way to save some of your hard-earned cash. That is if you are not afraid of a little hard work and waking before the rooster. The fast-paced convenient world of today can and will lead you down the path to debt. Four years ago I found myself in a terrible situation: How does one go about feeding a family of four on one hundred dollars for two weeks? Did we have enough money to buy gasoline just to get to work? It was scary not knowing where my family was going. Yet when I planted my first tomato, a thought sprouted in my mind.
My first homesteading goals were just to preserve my garden for the winter, insuring that there was always something to eat. But as my garden grew, so did my ideas.
There are initial costs when it comes to living a self-sufficient life. But all of the things that must be purchased will pay for themselves — the time that takes depends on how you manage them. We purchase our items slowly. Big items come with our tax returns, and only after any outstanding bills are paid. Smaller items are bought on an individual basis, depending what we can afford at the time, usually when we are out buying feed for our livestock. Because of the way we have built our homestead piece-by-piece, and the manner in which we have preserved our foodstuffs, we have money left unspent. Four years ago we would have never have believed this possible.
Homesteading isn’t something that can be done only in rural areas; even urban dwellers can benefit from simple self-sufficient activities:
Some of our start-up costs have been purchasing chickens, seeds, canning jars and equipment. My hot water bath and pressure canner came from someone that was no longer using them. The best advice I can give when it comes to your planning stage, is to talk openly about what you are wanting to do. You might be surprised on what some people have stashed in their attic and are willing to give freely. Check freecycle, your local paper, rural estate sales, garage sales and even try placing an ad in a free, or cheaply-priced paper for your wants/needs.
Once your chickens and seeds are purchased, your only costs will be feed and water (if you are not on a well). Seed saving will insure your next year’s garden. Allowing your hens to hatch eggs will replenish your stock. Be creative when it comes to reusing materials. We use our un-repairable refrigerator to store our feed, a broken fan stand for a sprinkler stand, and cracked hoses for deep soak waters. Save your glass jars to store dried goods in, and milk cartons to start seedlings. Just remember: it’s not white trash, it’s imaginative, frugal and eco-friendly.
My family might be an extreme when it comes to simple living. We are building a new home, a green shelter. Using only locally produced and recycled construction materials and building it ourselves will save us more than half the cost of paying someone else to build it. With a fire place, underground water cooling systems (air-conditioning) and going solar powered, our out of pocket expenses will drop dramatically.
Some other things to reduce expenses are:
These things do take time and dedication, but just the act of making your own dinners from scratch will save you money. Using flour, eggs, and water to manufacture your own noodles will cost you less than buying the same amount in the pre-made versions. This can be said about most things that you can create from scratch, the base components while at first seem more expensive, are cheaper when compared to their convenient counterparts.
While homesteading can seem daunting at times, it will save you money as well as bring your family closer together. At home, self induced family entertainment, is another benefit of living simply. It also comes with free educational experiences that are rarely taught in a public school system. Check in with your local extension office for free or inexpensive classes for you and your children. Take a drive in the country and look for hand made signs boasting of wares for sale, they can lead you to a wealth of knowledge and new friendships.
Modern homesteading is not for everyone. Yet taking a few of these suggestions and applying them to your own life will make a significant difference on the way you view the world, and the impact on your wallet.
You can read more about Phelan’s adventures in homesteading at her blog, A Homesteading Neophyte. She has also written articles for other publications:
If you’d like to read more along the same lines, I also recommend Pocket Farm, a weblog from a couple looking to achieve Voluntary Simplicity on a farm in Maine. You might also like homestead.org or the forums at Homesteading Today.
Source: getrichslowly.org
Want to get paid sooner? Your checking account might be able to help.
August 9, 2023
Watching for a direct deposit to hit your bank account can be a stressful waiting game, especially if you have everyday expenses to cover and bills that need to be paid. If this is an all-too-familiar challenge, you aren’t alone. Many Americans live paycheck to paycheck, without much of a financial buffer between paydays. And even after your paycheck is sent to your bank, it can still take a few days before that money is in your checking account and available to spend.
Whatever the reason, being able to get your paycheck early can make a huge difference. And your checking account can actually help you do this, depending on your bank. So, how can you get your paycheck early using an online checking account? It just takes a few simple steps and a little know-how.
Yes! You may be able to get your paycheck early and access your cash even sooner than expected, depending on the checking account you pick. Early access to these funds could help you cover immediate expenses or pay bills without having to rely on credit cards or incur late fees.
Not all online checking accounts allow you to get paid early, but some do. For example, Early Pay is one of the many benefits of a Discover® Cashback Debit checking account, and this feature allows you to tap into qualifying deposits days earlier than scheduled.1
Early Pay is a no-fee service offered to Discover checking account customers, giving you access to qualified Automated Clearing House (ACH) funds up to two days early. (ACH is an electronic fund transfer network across which banks and credit unions transfer money.) Eligible funds can include a direct deposit paycheck from your employer or an ACH transfer from a government entity, just to name two.
With the Early Pay feature, your direct deposits are made available to you soon after Discover is notified that the pending transfer is on the way. This means you can pay bills, make purchases, and prevent overdrafts on your Discover checking account up to two days earlier than expected.
The process for setting up direct deposit will vary by the payor (your employer, in most cases). Payors often have their own direct deposit form for you to fill out, or you may be able to provide an ACH form that your bank generates on your behalf.
In order to set up direct deposit, you’ll need to provide the payor with information such as your:
Also, you’ll likely need to tell the payor how you want the money deposited. Suppose you want half of your paycheck to go into savings, for example, or a set dollar amount to be redirected into another checking account. You may be able to specify those details when you set up direct deposit.
Checking with cash back and no monthly fees
Discover Bank, Member FDIC
Early Pay is available to Discover customers with online checking accounts, online savings accounts, or money market accounts. Early Pay isn’t available for Individual Retirement Account (IRA) savings accounts or IRA CDs because those are retirement accounts that aren’t typically used for short-term expenses.
If you have an online checking account, online savings account, or money market account with Discover, your ACH deposits may be eligible for Early Pay.
Discover Cashback Debit customers may be able to access their eligible direct deposit funds up to two days early. The timeline depends on when the ACH transfer is initiated by the payor and when Discover is notified that funds are on their way.
Early Pay is available to eligible banking customers with qualifying direct deposits, but does direct deposit come early for all Discover customers, all the time? Not necessarily. Discover can’t guarantee that the funds will always be available early because of actions the payor may take. Timing can also depend on when Discover is notified of the pending payment.
If you’re wondering how to get your direct deposit funds early with Early Pay, it’s easier than you might think. Once you get set up with direct deposit, which is usually done with an employer or benefits provider like Social Security, Discover takes care of the rest. Or, if you’re already receiving qualifying ACH direct deposits into your checking, savings (excluding IRA savings), or money market account, you’re already automatically enrolled in the Early Pay feature. Once Discover is notified that a qualifying ACH payment is en route, you can have access to your money up to two days early.
For Discover Cashback Debit customers, there’s no fee for the Early Pay feature. This means you can access your ACH deposits sooner at no additional cost.
You sure can. With Discover Cashback Debit, you’ll automatically be set up with Early Pay email alerts, so you’ll always know when your paycheck or other qualified deposit hits your account. If you want to turn off email alerts, you can unsubscribe anytime. And if you prefer text or push notifications, you can turn those on in the Discover App.
When choosing a bank, you’ll want to look for important benefits such as no fees, expansive ATM networks, mobile check deposit, and even rewards on checking accounts. Being able to get your paycheck early might be one of the most beneficial perks, though, whether you need it to pay some bills or if you’re ready to make a big purchase.
Discover Cashback Debit customers enjoy more than 60,000 no-fee ATMs in their network, receive 1% cash back on up to $3,000 in monthly debit card purchases,2 and can even get paid up to two days sooner with Early Pay—all with no fees. Take a closer look at Discover Cashback Debit and see if it’s right for you.
1 Early Pay is automatically available to checking, savings (excluding IRA savings) and money market customers who receive qualifying ACH direct deposits. At our discretion, and dependent on the timing of our receipt of the direct deposit instructions, we may make funds from these qualifying direct deposits available to you up to 2 days early. See our Deposit Account Agreement for more information.
2ATM transactions, the purchase of money orders or other cash equivalents, cash over portions of point-of-sale transactions, Peer-to-Peer (P2P) payments (such as Apple Pay Cash), online sports betting and internet gambling transactions, and loan payments or account funding made with your debit card are not eligible for cash back rewards. In addition, purchases made using third-party payment accounts (services such as Venmo® and PayPal®, who also provide P2P payments) may not be eligible for cash back rewards. Apple Pay® is a trademark of Apple Inc. Venmo and PayPal are registered trademarks of PayPal, Inc. Samsung Pay is a registered trademark of Samsung Electronics Co., Ltd. Google, Google Pay, and Android are trademarks of Google LLC.
Articles may contain information from third-parties. The inclusion of such information does not imply an affiliation with the bank or bank sponsorship, endorsement, or verification regarding the third-party or information.
Source: discover.com
Good personal finance spreadsheets are hard to find on the web because sploggers monopolize the search results. Still, I’ve managed to collect links to a stack of them that I’d like to share.
Spreadsheets more useful than web-based calculators because:
The following links are all real sites from real people with real useful information to share.
There must be thousands of other great personal finance spreadsheets out there. I’ll share the best of those I find.
Source: getrichslowly.org
After more than three years of an interest-free payment pause on federal student loans, millions of Americans will soon be on the hook for monthly payments. The effects could be felt across the economy.
How resuming payments will affect a single borrower varies widely, depending on, among other things, whether they stopped making payments at all, how much debt they have, the repayment program they’re in, and their current and future expected income. It also depends on the other expenses competing for a piece of their monthly budget. Because so many people are affected — 43.6 million people hold federal student loan debt, according to the Department of Education — the impact to the economy stands to be broad even if some borrowers don’t have a difficult time adjusting.
Currently, there is $1.6 trillion in federal student loan debt outstanding, according to data from the New York Fed’s first quarter Household Debt and Credit Report. This will come down by at least an estimated $39 billion (about 2.4%) before repayment begins, as long-time debtholders who have been paying for 20 years or more stand to have their slates cleared in a one-time adjustment recently announced by the Biden administration.
The White House is also implementing a repayment plan that could significantly reduce the monthly payments due for some borrowers, and a 12-month “on ramp,” where debtholders who enter repayment in coming weeks will not face repercussions for paying late. These two efforts alone could soften and slow the economic effects of those reentering repayment.
There’s little doubt that potentially hundreds of billions of dollars in consumer debt coming due will impact the economy — it represents debt held by roughly 17% of American adults and is the second-largest source of household debt, according to the NY Fed report. But the gravity of this impact is yet to be determined and likely to play out over the next several months and years. Here are four potential economic outcomes I’ll be watching for in the coming months:
In the first quarter of 2020, nearly 11% of student loan balances were 90 or more days past due, according to the Household Debt and Credit Report from the New York Fed. The payment pause cleared this slate, and delinquency stands at less than 1% as of the first quarter of 2023. That will change. The 12-month on-ramp plan that promises to not penalize late payments will delay this impact, but there’s a good chance that at least some of those who struggled before the pandemic will soon find themselves back in a familiar situation.
Pandemic relief payments and forbearances on mortgages and student loans were just a few of the factors that led to households having more to spend during the pandemic. Money that may have otherwise gone to student loan debt could be used for home repairs, clothing, or entertainment and travel after pandemic restrictions were lifted. This robust consumer demand has played a role in higher-than-comfortable inflation rates over the past few years.
The return of a debt obligation means some households will have to rein in their spending once again, and consumer demand will likely fall.
The personal saving rate — a percentage of disposable income that people are able to set aside after taxes and expenses — rose significantly, hitting 34% early in the pandemic, but is now at the lowest since the Great Recession, at 4.6%, according to the Federal Reserve Bank of St. Louis. With student loan debt payments coming due, this rate will necessarily decline for those affected households.
Borrowers on a student loan payment pause “sharply increased mortgage, auto and credit card borrowing,” a new working paper from the National Bureau of Economic Research reveals. Credit card balances initially fell in 2020 as relief payments came in and fewer debt payments went out, but that reduction in balances was ultimately undone. Overall, those balances were 10% higher by the first quarter of 2023. And it wasn’t just on credit cards that balances grew. Total debt balances grew by 19% from 2020 to 2023, compared to only 12% from 2017 to 2020, according to the Household Debt and Credit survey.
The increased liquidity, or available cash, in households with paused student loan debt may have gone toward home or auto down payments they previously struggled to afford, according to the NBER paper. Now, having to return to regularly scheduled student loan obligations after three years without payments could leave some new homeowners (and additional debtholders) strapped. Though the total share of delinquent debt balances fell from 3.2% to 1.4% in the three-year forbearance period, representing a difference of about $215 billion, it’s likely this will ultimately settle closer to the pre-pandemic rate.
If you’re worried about your ability to make full student loan payments once the forbearance ends, the 12-month on-ramp period will save you from default, so consider easing back into full payments if it’s helpful. But remember, your loan balances will accrue interest during this time, so the sooner you can make full payments, the better. If your payments are simply too high to manage, contact your loan servicer; an income-driven repayment plan may be a good fit, and a new one is set to launch this fall.
Source: nerdwallet.com
Graduate school can be expensive. On top of tuition, you typically need to cover the cost of books and living expenses. At the same time, you may be juggling undergrad student debt.
One way to ease costs is to get a graduate assistantship. If you’re not familiar with the concept, a graduate assistantship is a salaried employment opportunity for graduate students. Graduate assistants work a set number of hours per week and, in return, receive a tuition waiver and/or a monthly living stipend.
Securing a graduate assistantship can buoy finances and boost connections. Read on to learn how graduate assistantships work and how to find one.
Graduate assistants are students enrolled in graduate or professional schools who assist departments or professors in a teaching, research, or administrative capacity. A graduate assistant might be paired with a professor who is actively engaged in research or work that might complement their career goals or current focus.
Graduate assistantships often benefit both the university and the student. The university is able to fill positions that might be more costly if filled by a traditional employee. The student typically receives a tuition waiver, monthly stipend, and/or a fixed sum of money to help them pay for graduate school. Some programs may also offer class credit for these jobs.
💡 Quick Tip: Fund your education with a low-rate, no-fee SoFi private student loan that covers all school-certified costs.
Overall, graduate assistant programs are meant to offer value to potential students, and to defray at least a portion of the costs associated with pursuing a graduate degree.
When combined with scholarships, grants, and other financial awards, becoming a graduate assistant can make the costs of grad school more manageable. Some schools also offer tuition waivers — for some or all of the tuition — for qualifying graduate assistants.
Compensation packages vary depending on the school but tuition waivers are more commonly offered to graduate assistants who are employed by the school already, have financial or other hardships, or are veterans (or the spouse or dependent of a veteran).
Graduate assistantships that offer tuition waivers are often competitive, so it can be a good idea to explore the assistantship options offered by your college or department and apply as early as possible.
Another thing to keep in mind: A stipend typically counts as taxable income, though it isn’t considered wages (which means you won’t pay Medicare or Social Security taxes on it). So while assistantships do bring in some extra money, Uncle Sam will collect a portion of it.
As for tuition waivers, graduate assistants can exclude up to $5,250 worth of educational assistance benefits from their income each year, according to the IRS.
Also keep in mind that many universities prefer it if graduate assistants don’t seek additional, outside employment. It’s a common policy intended to protect a graduate student’s limited bandwidth — being a full-time student with an assistantship can feel like having two full-time jobs. Adding an additional part-time job on top of that could become too much of a strain.
Recommended: Finding & Applying to Scholarships for Grad School
How you go about becoming a graduate assistant will depend on the program and school. Acceptance letters often include at least some initial information pointing students toward any financial aid or assistantship the program might be offering.
You can also explore graduate assistantship opportunities by looking at the school’s or department’s website, as well as websites of professors. In addition, you can check the school’s job boards and social media sites, and even just do an online search using the name of your intended school and the phrase “graduate assistant.”
Stipends and/or tuition waivers that come with graduate assistantships can make graduate school more affordable. However, if you still have gaps in funding, you may want to explore scholarships, grants, and federal or private student loans.
Graduate and professional students can apply for federal Direct PLUS Loans. Eligibility is not based on financial need, but a credit check is required.
Graduate and professional students may also apply for Direct Unsubsidized Loans; again, eligibility is not based on financial need.
To apply for federal loans for graduate school, you simply need to complete the Free Application for Federal Student Aid, or FAFSA.
Because graduate students face some of the highest federal student loan interest rates, and loan origination fees, you may also want to look into private graduate school loans and compare offers. Just keep in mind that private student loans don’t come with same protections, such as forbearance and forgiveness programs, offered by federal student loans.
💡 Quick Tip: Need a private student loan to cover your school bills? Because approval for a private student loan is based on creditworthiness, a cosigner may help a student get loan approval and a lower rate.
Getting a graduate assistantship position can help cover the often high-cost of graduate school. These positions can involve being a teaching, administrative, or research assistant. Compensation may be in the form of a monthly stipend and/or a tuition waiver.
If you aren’t able to get a graduate assistantship, or you have secured one but it isn’t enough to fully cover your costs, you may want to look into other sources of graduate school funding, including private grants and scholarships and federal or private student loans.
If you’ve exhausted all federal student aid options, no-fee private student loans from SoFi can help you pay for school. The online application process is easy, and you can see rates and terms in just minutes. Repayment plans are flexible, so you can find an option that works for your financial plan and budget.
Cover up to 100% of school-certified costs including tuition, books, supplies, room and board, and transportation with a private student loan from SoFi.
SoFi Loan Products
SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.
SoFi Private Student Loans
Please borrow responsibly. SoFi Private Student Loans are not a substitute for federal loans, grants, and work-study programs. You should exhaust all your federal student aid options before you consider any private loans, including ours. Read our FAQs.
SoFi Private Student Loans are subject to program terms and restrictions, and applicants must meet SoFi’s eligibility and underwriting requirements. See SoFi.com/eligibility-criteria for more information. To view payment examples, click here. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change.
Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
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Source: sofi.com
Are you questioning whether having kids is right for you? We understand your hesitation. In today’s world, it’s not a shock when people decide to forego parenthood and pursue different life paths or family structures. Between monetary concerns, mental health considerations, personal values, or lifestyle choices, there are many reasons why some decide that having children isn’t for them (or even their potential little ones).
One user shared, “Kids are annoying AF. Also, in this Economy, I can’t afford [anything]. How tf am I supposed to have a kid as well??”
One Redditor shared wisdom: “Better to want kids but not have them than to have them and not want them. You don’t need reasons not to want kids. You better have really good reasons to have kids.”
Another user asked, “Why should I have really good reasons for having kids?”
“Because having a kid is a life-changing responsibility. For life. That’s not a quirky little decision of ‘Yeah, why not?’” one user replied.
Another commenter added, “That doesn’t mean it requires a really good reason. You just have to be a responsible adult that wants a kid.”
One Redditor concluded, “So you don’t need a good reason; you just have to be good at parenting.”
A user commented, “Too loud, too sticky, too smelly, too dependent, incomprehensible beings, I lack patience. I like the quiet; I like my sleep. I like my child-free life.”
One user elaborated on his reasons and posted, “I can’t afford them, and I know my genes are volatile. My offspring would be almost guaranteed to inherit my medical issues.”
One user added, “Childhood trauma makes the idea of raising a child unthinkable. Also, an inability to work normal hours and provide for a child.”
One Redditor elaborated, “I don’t like kids. Nope, they’re not cute. They cost a lot. I hate loud noises. I am not a morning person. So, no to waking up early to prepare food for kids. I don’t have enough patience.
“I can’t even be responsible for myself most times; why would I want to bring another human? I prefer my solitude. I won’t be able to function as a human mom. I’m a dog mom, but that’s good enough for my caring nature.”
One user posted, “Tons of $$$.”
Another user calculated, “Based on statistics, it takes around $300 000 to raise a kid until 18 without any emergencies, and this was like 4-5 years ago. It’s probably like 50k more now.”
“More important question: why should you want to have kids? There’s literally no unselfish reason to do so,” one Redditor commented.
Another user answered, “No reason to get rude towards people who do want kids.”
The OP responded, “Not being rude. It’s just a fact.”
Another user asked, “I’m curious: why do you think it’s selfish to want to have kids?”
The OP answered, “I don’t think that….. It’s a fact. People, the majority of the time nowadays, have children as an accessory to their own lives. You are neglecting the fact that they are bringing a whole human into this world. To make an entire soul(s) endure the ups and downs of life on earth just to fulfill your own personal feelings of having a child is nothing but selfish.
“So again, I ask? What reason is there… outside of selfishness on their own decision… to have one? I’m genuinely curious as to a reason why a person should that is beyond their own decision to do so.”
One Redditor shared his frustration, “I am mad this is the planet I’ve been stuck on, So I occasionally feel like I would not want to be responsible for another human having to experience what this life is like sometimes.”
Another user countered, “Earth is beautiful, though.”
One user shared, “A rare genetic condition runs in the family; it has been found in my sister and me too, it s-cks, and I don’t want to pass it down, and even if I don’t, I have a sick mom, I know how hard it is on the child. I don’t want to be the sick mom to another kid.
“I’m autistic, very sensitive to noise, textures, and smells, and will go crazy if I can’t have quiet/alone time. So I wouldn’t be a good mom, and I’d end up traumatizing the kid. I’m terrified of what pregnancy and giving birth do to a woman’s body.
“That doesn’t mean I’ll never decide that I want a baby. But I’d be irresponsible for that.”
One user posted, “This world we live in is horrible; I hated going to school for the first 21 years of my life. I hate that all I have to live for is working to be able to afford to live. Why would I subject someone to live this life in this world? Also, I think people forget that their kids will eventually be grown—and often, parents fall short when teaching morals or how to be a good person; I know my parents didn’t teach me things I wish they did. What if they turn out to be a killer or [sexually abuse others] no matter how hard I try to be a good parent? Yeah, it’s a no. If I ever decide I want a child, I’ll adopt a teen or something.”
One user shared, “Pregnancy and birthing. Even if I was a millionaire and could afford kids and all their expenses, I could not birth them. I don’t want my [body] ripping down to my [butt]. Then there’s always a chance of dying. And you could go through all of that, and your kid may just die anyway. Not worth the pain.”
One Redditor also shared, “Lost interest after 30. I’m not in good health to have kids. There is stuff I want to do that I couldn’t do when I was younger. I didn’t have the money to travel anywhere where I wanted to take up expensive hobbies. Plus, there are plenty of children in foster care that need a home if there is a small chance I change my mind.”
Do you agree with the others’ perspectives in this article? Share your comments below!
Source: Reddit.
There’s no question that relationships can be confusing, but here are some of the top things to avoid if you want to keep your relationship healthy!
We all have a favorite actor or actress, but most of us have a least-favorite as well. Check out this list of actors and actresses people never want to see performing again!
Some inventions are world-changing, and some of them, well, they change the world in the wrong ways. Here are some of the worst inventions Redditors could think of.
We’ve all had moments of hygiene faux pas—but these celebrities just look like they don’t take care of themselves at all.
Every fad has its time in the limelight, but some of them come and go faster than others; and some just need to die out right away. Check out this list of fads of which people were happy to see the last.
Source: financequickfix.com
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Tue, Aug 8 2023, 10:41 AM
Lending continues to be intertwined with legal and compliance issues. Here’s a story from overnight that is catching a lot of attention: “Equifax stock falls after saying it received a CID from the CFPB.” The Federal Trade Commission (FTC) agreed to drop its challenge to Intercontinental Exchange Inc.’s (ICE) proposed deal with Black Knight Inc. in a joint stipulation that allows them to work toward a settlement. Lender ToolKit is suing Celebrity Home Loans and MLD. and Meanwhile, lenders and vendors are doing what they can to increase business and tap into new markets, and with that in mind National MI is sponsoring a weekly podcast beginning today focused on offering mortgages to people in their 20s and 30s (Mortgages with Millennials). (Today’s podcast can be found here and is sponsored by SimpleNexus, an nCino Company, developer of mortgage technology uniting the people, systems, and stages of the mortgage process into one seamless, end-to-end solution. Listen to an interview with Bank of Oklahoma’s Chris Maloney on volatility and spreads, the money supply, and bond over/underperformance.)
Lender and Broker Software, Products, and Services
Everyday expenses are rising for millions, including many prospective homebuyers saving for a down payment. Mosi Gatling, a top producer at loanDepot, leaves no homeowner behind in the Las Vegas market as she assists mainly first-time, military and low-income buyers moving forward with mortgages supported with down payment assistance. Down Payment Resource shares her story and how her team of six does nine figure volume by working closely with Diane Arvizo of the Nevada Rural Housing Authority in Doing Well While Doing Good. We think this is a great example of one thing happening in Vegas that shouldn’t stay there. Read the full story here.
Work Hard Easier. Here’s how to work less and win more in this tough market. Your first instinct may be to work even harder than you have been. But instead, you should focus your energy on the essential tasks: making one-to-one phone calls, having face-to-face meetings, and personalizing your marketing with video content. Automate tasks like prospect follow-up, loan in-process updates, Realtor, and past customer outreach, thank you cards and closing gifts, etc. Set up automated social media posts also. A truly easy SmartCRM system will do all this and more. Take a look at Usherpa’s Relationship Engagement Platform, ranked number one in customer service and client loyalty in the mortgage business. Download this free Field Guide to Success and 3 Habits of Top Producers eguide to see how easy delegation can be.
In continuing to provide ways to grow happiness for our customers, TMS will become the Master Servicer for the Golden State Finance Authority’s (GSFA) Golden Opportunities “GO” a down payment assistance program. As of July 17, 2023, it is open for reservations. The Golden Opportunities DPA make mortgages more accessible for homeowners in CA by providing first mortgage financing, down payment, and closing costs assistance. The guideline eligibility under TMS will include FICO scores down to 620, DTIs up to 55% with AUS approval, and manual underwrites on VA and USDA loans. If you’re not an approved TMS lender, contact TMS. To become a participating lender of the GSFA Golden Opportunities DPA click here.
ICE Mortgage Technology’s VP of Product Strategy, Nancy Alley, was recently named one of HousingWire’s 2023 Women of Influence for her strategic execution and advancement of the Encompass® lending platform. Nancy’s profile spotlights how her unwavering customer focus has led her team to deliver the technology today’s mortgage lenders need to operate more efficiently and deliver a better borrower experience. Curious how Encompass customers are maximizing their technology investment and creating a future-proof business strategy? Click here to hear industry leaders share their key to success for staying at the forefront of innovation.
Big news! The Optimal Blue® PPE is now integrated with Encompass Partner Connect. Current clients can convert to the platform via the Encompass Partner Connect API. This new integration offers many features and benefits, including: a refreshed, modern Optimal Blue user interface; a single sign-on experience; users no longer needing to exit the loan on auto-accept transactions; the ability to view rates across all lock periods on one screen; an enhanced push queue view for secondary users; faster access to updates and new releases; and more! Complete your conversion to start taking advantage of these integration benefits today. Not using the Optimal Blue PPE yet? Learn how it can help you win more business by providing borrowers the right product at the best price for any mortgage financing scenario.
As lenders adapt to volatile mortgage rates, many are stopping to reconsider their servicing strategy. Do inconsistent mortgage origination volumes have you questioning what makes more sense: retaining servicing or selling servicing released? Seth Sprague, CMB, Richey May’s Director of Mortgage Banking Consulting Services (aka, resident servicing expert), outlines the 13 key trends and strategies in servicing including recommendations on how to make the right decisions for your business. Want more help defining the optimal strategy? You know where to find us.
TPO Programs for Brokers and Correspondents
Rising interest rates and inflation causing a dip in originations? Maximize your portfolio reach with HELOC options designed to help your customers tap into their home value to remodel kitchens, fund education, and more. LoanCare has a comprehensive understanding of the special nuances involved in servicing HELOCs such as knowing what’s required to appear on monthly statements, ensuring that interest calculations are accurate, and setting up the HELOCs correctly when the loans are on-boarded. We can accommodate segmented, fully amortized, and interest only HELOCs. Contact LoanCare today!
Events and Webinars
Back in 2016, Netflix reported that the machine learning algorithms behind its personal recommendation engine were saving the company $1 billion in content spending a year. AI and intelligent automation aren’t just technologies of the future, they’re tools you can and should be using to reach borrowers with the right message at the right time. Join Partners Mortgage’s Katie Pastor Trinidad and Joe Wilson of Social Coach alongside Dave Savage of TrustEngine on Thursday, August 10 at 2 pm ET for a free webinar on how AI can help you increase borrower engagement and loan conversions. Register today.
Lenders, want to save you and your borrower time and money? Appraisal waiver programs like Fannie Mae’s Value Acceptance + Property Data allow lenders to skip a traditional appraisal, saving the time and cost associated with it. Watch a free webinar recording featuring Lyle Radke, Senior Director of Collateral Policy at Fannie Mae. Learn the benefits of this program, use cases, and find answers to common lender questions. Plus, discover how to quickly get started with the program.
Modern financial institutions rely on their technology ecosystem to support the needs of increasingly diverse customer bases. But without a connected solution, financial institutions can’t provide seamless, personalized experiences that build lifelong relationships. Total Expert is purpose-built to help you deliver the perfect mix of digital and human-led engagements as modern consumers flow between digital channels, SMS, and in-person interactions. That’s why leading lenders like Guaranteed Rate, Atlantic Bay Mortgage, and PRMG trust Total Expert as the hub that connects their technology ecosystems and helps them deliver the perfect financial journey. Join us for a fireside chat with these industry trailblazers on Wednesday, Aug. 16 when they’ll present: Strategies for defining your tech ecosystem and goals, priorities for evaluating and procuring the tech that meets your goals, methods for generating and measuring ROI from your tech investments, and a live Total Expert platform demo. Register for the webinar.
Are you wondering what today’s Fed decision means for rates and the mortgage market? Register for a new webinar on August 9th at 11AM PT hosted by Agile Trading Technologies.
In this webinar, Phil Kukafka of Towne Mortgage, Ryan Ferderer of Multi-Bank Securities, and Andrew Rhodes of MCT will give an overview of MBS pooling, discuss the current market, share strategies for efficiently pooling and selling mortgage-backed securities, as well as the process for MBS pooling using Agile’s technology.
Join Optimal Blue for the next session in its Hedging 301 series on Wednesday, Aug. 9th, Noon ET, take a deeper dive into more advanced capital market strategies and how they naturally interplay with technological advances. This session will address the many ways Optimal Blue helps clients streamline daily processes to achieve success and optimal best execution – including mandatory price discovery and dissemination, saving basis points while delivering representative mix, solving for numerous execution iterations, and integrating to the MSR broker community for live, loan-level servicing valuations.
Join AGENT U on August 8th at 12:30-1:30pm EST for the next installment of their free monthly webinar. This month, the hosts are speaking with credit repair expert Janna Fox, CEO of ReScore, to learn about credit misconceptions. Learn how collection companies affect consumers’ credit scores, how to spot errors on credit reports, and gain insight into the hidden damage caused by pulling credit. Plus, learn expert methods to rapidly improve credit scores. Janna will be answering your questions during the live Q&A session. Visit www.agentulive.com for more details.
Looking for more in-depth commentary on weekly mortgage news? Register here for “Mortgage Matters: The Weekly Roundup with Robbie and Rob Chrisman” presented by Lenders One. Every Wednesday at 2:00 PM EST/11:00 AM PT starting August 9th, Robbie and Rob will dive into a range of mortgage-related topics, including market trends, interest rate fluctuations, innovative mortgage products, and industry advancements. Robbie and Rob will bring a unique mix of age perspective, expertise, and charisma to the screen, ensuring that the information is not only educational but also entertaining. Register for the first show on August 9th with Lenders One’s Justin Demola, CMB, as a featured guest discussing chatter from his hundreds of members.
“AFR Wholesale® (AFR) is teaming up with financing experts from Fannie Mae for the next session of our Why Wait Live Webinar Series! Please join us Wednesday, August 9th at 2 PM EST, where we will be highlighting what you need to know about manufactured home financing. Over this series, AFR has been discussing affordable financing solutions that together will help us provide homeownership opportunities to more families. Register Today! This is a live webinar, and a recording will not be provided.”
Friday the 11th at 3PM ET is the next edition of The Mortgage Collaborative’s Rundown with Melissa Langdale and me. We’ll will be covering current events in the mortgage market for 30 minutes starting at noon PT in “The Rundown”. Special guest co-host Skylar Olsen, Zillow’s Chief Economist.
James Brody, who was named Senior Litigation Partner in the wake of his merger with Garris Horn, LLP, will be co-hosting a webinar with The Mortgage Collaborative (“TMC”) at 10:00 AM PST, on August 17, titled: “Repurchase Defense Roundup: Proven Strategies to Help Lenders Fight Repurchase Demands and Pursue Culpable Third Parties.” Both Mr. Brody and his colleague, Ingrid Petersen, look forward to educating attendees on a number of invaluable strategies that will help them more effectively fight repurchase demands and improve their chances of being made whole whenever a lender is not able to successfully dispute a claim because of bad facts and/or needs to preserve a business relationship.
Capital Markets
Bond yields push higher to open the week following hawkish comments from Federal Reserve officials. New York Fed President Williams sees Federal Reserve policy remaining restrictive “for some time” and Fed Governor Bowman said that additional rate hikes will likely be needed. Rates have also been pushed higher following last week’s double-whammy of Fitch’s ratings downgrade and the heavy supply announcement from the U.S. Treasury. And don’t forget non-farm payrolls from Friday, which showed that despite missing the headline number and the previous month’s observations being revised lower, wage growth increased more than anticipated.
July marked the second consecutive month of job growth below 200k, signaling the labor market continues to cool. However, wages held firm, adding to arguments the Federal Reserve has gotten the upper hand on inflation without triggering a recession or major job losses. The unemployment rate declined to 3.50 percent, which is slightly above the 53-year low set back in January. The ISM manufacturing index improved but remained in contractionary territory for the ninth straight month in July. Price paid eased for the fifth time over the last seven months. Meanwhile, service data showed moderate expansion once again as consumers shift spending from goods to services. The most recent Senior Loan Officer Opinion Survey shows credit conditions for commercial and industrial loans remain tight and 40 percent expect further tightening. This could create a drag on growth as projects become delayed or abandoned due to lack of financing.
Though this week will be dominated by the Consumer Price Index report on Thursday and the Producer Price Index on Friday, as well as consumer sentiment, small business optimism, and mortgage earnings from United Wholesale, Loan Depot, and Guild, today’s economic calendar kicked off with NFIB small business optimism for July (hitting an 8-month high). We’ve also received the June trade deficit ($65.5 billion). Later today brings the beginning of Treasury’s quarterly refunding when it auctions $42 billion 3-year notes. Two Fed speakers are scheduled, Philadelphia President Harker and Richmond President Barkin. After the yield curve extended its recent steepening move yesterday, we begin the day with Agency MBS prices better by .125-.250 and the 10-year yielding 3.98 after closing yesterday at 4.08 percent, bonds rallying in part due to some slow-growth news out of China.
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Source: mortgagenewsdaily.com
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Source: goodfinancialcents.com