Advertisement
UK markets closed
  • NIKKEI 225

    38,102.44
    -712.12 (-1.83%)
     
  • HANG SENG

    17,936.12
    -5.66 (-0.03%)
     
  • CRUDE OIL

    79.77
    +1.32 (+1.68%)
     
  • GOLD FUTURES

    2,329.90
    -19.20 (-0.82%)
     
  • DOW

    38,665.38
    +76.22 (+0.20%)
     
  • Bitcoin GBP

    51,895.75
    -520.43 (-0.99%)
     
  • CMC Crypto 200

    1,379.00
    -9.16 (-0.66%)
     
  • NASDAQ Composite

    17,795.87
    +106.99 (+0.60%)
     
  • UK FTSE All Share

    4,437.53
    -0.84 (-0.02%)
     

State of the consumer, retirement and job search tips: Wealth!

On today's episode of Wealth!, host Brad Smith spotlights the current state of the consumer and the critical topic of retirement planning.

Yahoo Finance's Brooke DiPalma joins the discussion, dissecting the earnings reports of Best Buy (BBY) and Foot Locker (FL). Her analysis delves into what these financial results signal about consumer behavior amid current economic conditions. Red Robin Gourmet Burgers (RRGB) CEO G.J. Hart also offers his insight into consumer habits within the dining industry.

Shifting gears to retirement planning, Yahoo Finance's Kerry Hannon unpacks the challenges faced by Gen X in prioritizing retirement savings. Rounding out the show, Yahoo Finance contributor Ross Mac provides guidance on setting appropriate savings and retirement goals for individuals across various age groups.

This post was written by Angel Smith

Video transcript

Welcome to Wealth everyone.

ADVERTISEMENT

I'm Brad Smith and this is Yahoo Finance's guide to building your financial footprint.

Our community of experts is gonna give you the resources, tools, tips and tricks that you need to grow your money on today's show.

We've got a fresh reading on the economy.

We'll explain what it could mean ultimately for your portfolio and consumers pulling back on spending in certain categories.

We're gonna dig into how Americans are feeling about their finances plus the financial benefits of a no spend month.

We'll tell you what it is and how you can try it at home.

All right, we've got a lot to cover, but first investors are weighing a fresh reading on the economy GDP for the first quarter clocking in at 1.3% in line with expectations.

But down from its initial reading in April, the reading comes at a time when markets have been sensitive to any data that can help inform the fed's decision on rate cuts as inflation has proved sticky than expected.

So how can investors protect their portfolios in this current environment?

Anthony Sara, who is the Providence Financial and Insurance Services president?

Great to have you here with us this morning, Anthony, first and foremost, you see a print like this come off in GDP, at least in the revisions that we were able to see come through as well.

And what goes through your mind as to how the economy is faring right now, even in the face of stickier than expected inflation, particularly in some of the services areas.

Well, the economy is faring well, and that's, that's part of the issue.

Everything is softening.

Um But inflation, inflation is the one thing that is just still sticking around when you look at inflation data.

Uh you know, it, it's stuck in that 3.4% range for the last couple of years.

You look at the labor data and I think that's one of the biggest areas of uh of s stickiness uh or of concern when it comes to consumers is that labor that has solved, but it's still strong.

If you go back a couple of years, there were two jobs available for every worker.

Now there's I think it's 1.3 jobs available for every worker.

So that's coming down.

But the unemployment rate is still on that 3.43 0.9% range.

Um But the labor market is a big reason why the economy is so strong GDP has come down as we notice right, last print uh 1.3% but the consumer is there expectations have risen the CC I came out just the other day and their expectations are stronger than they were before, but the savings rates are going down, credit card rates are going up.

So there is just really a mixed bag.

Uh At this point with the consumer, there's a lot of things to take into consideration though.

But the higher rates, the higher inflation stays, the softer the consumer is gonna be become.

And that's probably the biggest worry about the future is the the strength of the consumer, current dollar personal income that actually increased by about or increased $404.4 billion in the first quarter.

A downward revision of $2.6 billion from the previous estimate here.

Uh and the increase they say in the first quarter was primarily reflected by increases in compensation coming back to the wage fund that you were mentioning there and, and led by private wages and salaries here.

So what is the kind of evaluation of where we stand on wages and where that's continuing to moderate right now?

And the pass through to the consumer mindset?

Well, one of the things that you have to know about inflation is there are some areas where inflation can come down and go up and kind of fluctuate as necessary energy is one of those areas that can go up, it can come back down, uh commodities, they can go up, they can come back down, but wages can go up, but they can never come back down.

I'm an employer and over the last couple of years when we've had, you know, so many jobs available and so few workers, workers have felt like they can write their own ticket.

They feel like they can go somewhere else.

They don't like you, they can kind of give you the finger and, uh, in that way and they can move on and the bottom line is, is, go find another job that's softening a little bit, but there's still a lot of jobs available, but I've had to give raises to my staff to keep them and you can't give a raise a year ago because wages are up and, and inflation has gone up and, and look, I gotta keep you.

So I'm giving you a raise and now of a sudden everything's come down, try going back to my staff and telling them, look, guys, inflation is down, I'm gonna take your raise away.

No, it doesn't work like that.

You can't take that back.

But guess what?

That has to be passed on the consumer.

Uh, and I think that's what a lot of people don't understand.

Uh, is that those wage increases?

It's the biggest expense on most companies, uh, bottom line.

I, it, it can't be taken back once you've given a raise, you're not gonna get rid of it.

So that's a lot of what's causing.

Uh, this is sticky inflation, Anthony.

We're kind of look forward to tomorrow and, and P ce, what we're expecting there if we get a hotter than expected read on P CE.

What does that do for the feds mindset?

Well, the fed is in a pickle right now.

The fed is in a, you know, trying to figure out how do they lower rates?

They want to lower rates.

They've said that at the beginning of the year, but they have to have the economic data to lower the rates and they're not getting that at all.

You know, their mandates are too right, full unemployment and uh low inflation, the unemployment, they got that under control.

The 3.9%.

It's the inflation that they can't get under control.

Now they say that their price target is at 2%.

I, I don't know that they're gonna get to 2%.

They don't need to get to 2% before they act, but they can't have it going up.

So the fact is that if the P ce comes in hotter than expected, uh they're not gonna be able to lower rates and I, I, I think one of the fed presidents, maybe it was Ka Kari who recently said that uh rate increases aren't off the table.

They got to get this inflation down though.

A hotter than expected PC print is not gonna help anything for sure.

They, they're not gonna be able to lower rates.

Anthony Sarro who is the Providence Financial and insurance services president and thanks so much for taking the time here with us kicking off today's show.

Thank you, Brad.

Certainly.

Let's hone in on the retail sector.

A little bit more of a reading on the consumer warning signs continue to flash over the health of the consumer.

As Best Buy is one of the latest retailers reporting sluggish results as consumers tighten their wallets in certain purchase categories for a deeper dive into the company's earnings is Yahoo Finance senior reporter Brooke Dipalma all over Best Buy.

The business of electronics, fridges, appliances, home theaters, all over it.

And all of those, all those statements of the business that you mentioned are all down.

And really this is an ongoing phenomenon that's been over the past two years for the company.

We saw us sales coming lower than Wall Street's estimates down roughly 6.3% once again dragged down by appliances, entertainment, and consumer electronics the most.

Now when Yahoo Finance Act, Ceo Cory Barry on a call with reporters, what the state of its consumer is.

She said that the consumer is still on evening that they're behaving really differently.

And what has been consistent is that we're seeing a consumer that is prioritizing the basics.

Remember, food fuel lodging are materially more expensive than they were pre panic.

Now, one driver though that she did say that could get consumers back in the doors to spend more, could be innovation.

We're returning with the likes of A I products like Microsoft and New line up of Google chromebooks and bar on to say that those tend to start at a higher price point.

There's definitely a consumer who fundamentally believes that the value propositions of these devices will make them more productive.

But there's a catch here.

She also believes that with a higher price point from his A I products that could also drive demand for new products that maybe aren't as high tech.

She said this, that also means some of the older generations of products are typically marked down.

They then can create a value based entry point for people who might wanna replace something that is old, but at a much more attainable price point.

Now important to note to you, Brad is that with all this A I introduction, consumers don't really know what exactly it is or how exactly it will benefit their work or personal life.

And so ensuring that they can come in store and try out these products is crucial for best buy to optimize this opportunity.

Yeah, absolutely.

Brooke, you're also watching Foot Locker here and in the business of Sneakers and the business of keeping the feet comfortable out there.

So how did its Q one results compare to previous quarters?

So their turnaround plan is what to keep a close eye on here, Brad.

It's called the Lisa plan pretty, pretty unique but, but really what we saw there was that discretionary income is not going towards sneakers.

And so Foot Locker really doubling down trying to understand how the going to get those, uh, consumers who are pinched with prolonged inflation, reduced savings and higher interest rates back in the door to use that discretionary income.

And they seem, as you could see shares up roughly 23% investors seem to be liking this, uh, new plan and consumers seem to be liking it too.

Their digital business, they're expected to launch a loyalty program called FLX Rewards that's launching Q two.

They, in addition to that are introducing this new store experience, a concept in Wayne, New Jersey.

They're seeing higher foot traffic there as well as higher basket sizes.

And also they're really focusing on to returning growth with Nike.

Nike makes up about 60% of their portfolio and they're hoping with working with Nike on their multi year growth plan, they'll be able to use innovation that Nike is just coming out with ahead of the Paris Olympics, really drive customers back in.

That's going to be a huge element for the business here, Paris Olympics, a major event.

Um Of course, that is gonna potentially be the next driver for a lot of these athletic apparel and retail companies here.

Brooke, thanks so much for breaking this down.

We'll continue to track it as well here for locker shares, man.

Just absolutely jumping.

All right.

So reports from retailers show that people are still buying, but they're being a little bit more picky about what they buy and for how much, what price tag, for more insight on where shoppers are spending.

I'm joined by Deborah Weinswig, who is the co site founder and CEO, I mean, Deborah, you just heard the run through from our own Brooke Dipalma on some of the earnings results that we've seen over the course of this retail portion of the earnings season.

What is your evaluation of where consumers are comfortable spending and where they're pushing back?

It's a great question.

I think, you know, we've still got some more earnings.

But at this point, we're saying luxury continues to perform well because there's value in this idea around sustainability of the product, there's a huge focus on value.

So almost this hourglass, right?

So you're going to spend on duration, you're also going to spend on value and the middle continues to get squeezed.

I think we're continuing to see that and innovation, right?

So if there is innovation in electronics, if there is innovation in home, where there's innovation, the consumers also very focused.

So it, I would say that this idea of where we are is not so different than where we expected.

It's just that the middle is getting squeezed probably a bit more than everyone would have thought at this point in the cycle, which retailers does that middle squeeze, if you will, as you mentioned, impact the most target comes to top of mind, right?

Grocery that is not value oriented.

So that would be like a Kroger and Albertsons et cetera, right?

We've really seen Walmart pick up share and continue to not only be top of mind for consumers but also very focused on, on budget and well, some of their new programs around loyalty.

So I would say it's those retailers where you have loyalty, but that you are also price sensitive And so more on the kind of we call it the consumer staples categories.

And I think, you know, a target of Kroger Albertsons, those are the ones where I'd be more concerned at this point that they are losing market share to others or not growing their share as much as we would have expected.

How well positioned are companies who have more of a digital footprint who have really gone omni channel invested for years now at this juncture into some of their elements and having this touch point with a lot of their customers that used to make their way into doors or into malls.

And perhaps now the shopping mall as they think about it has shifted to just being in their feed and they wanna purchase that way or it's just an app that they use.

All these things considered.

How prominent is the digital first or at least the digital second type of retail experience.

Your timing on that is beyond perfect.

So we were just out of I CS E, which is the big retail real estate show.

And what we've seen, I think surprisingly right foot traffic is literally at an all time high and the top malls there's no space they're literally building in the outlets, meaning like the parking lot.

So this idea of online offline kind of coming together is really what's critical.

And I, I think that what you're alluding to is that we've got to see the same pricing ideology product, both in the digital world and the physical world.

And having a consistent experience is also very critical, the ability to sh you know, kind of showcase and highlight the innovation is also very important.

And I think it goes back to right, kind of calling out a foot locker and some of the other retailers who are really doing a great job of delivering tech.

We're really seeing them kind of like rise to the top because the consumer is not only trying that in store, but they're also buying online and its simplicity, frictionless seamlessness.

However, you want to look at it between the online and the offline world is more relevant than ever.

And for those retailers who do it right, we're seeing lower returns in terms of right, consumer keeping the product, we're seeing higher ro I and then we're seeing more not only digital traffic but for traffic as well.

So there definitely is a willing, you know, a winning formula right now that we're seeing Deborah to the extent that your crystal ball is still fully functioning.

I mean, mine's in the shop right now, but we're going into a season where during the summer people prioritize experiences, shopping and experiences spending.

What does that hold for some of the largest retailers and consumers looking at the evaluation of where they're seeing value in goods versus where they have a propensity to spend on making sure that they're getting R and R and the vacation experiences.

Yeah, that is really relevant.

I mean, there's a mall out in New Jersey called American Dream.

And so you can shop and experience, there's literally like an amusement park and whatnot.

So I think that what we're seeing is that this idea of like the mall as an experience and one that's very affordable is becoming increasingly important, relevant and certainly the retailers and the landlords are thinking about that as you know, budgets may be a little bit more restricted this summer.

And so I think this idea of how to deliver an unbelievable experience at a price that people can afford and that they can also, you know, be with their families and you know, kind of check some things off of their to do list.

That is what we're seeing for summer 24.

And you have to think right back to school moves earlier and earlier and earlier, right there are schools that start mid July.

So yes, sorry, I didn't, I didn't think I said that out loud, Deborah.

But you know, you think about it, right?

We're almost in June 1st.

So some folks are going back to school in six weeks.

And so that's where, right this summer becomes increasingly different, depending on where you live.

And I think that it's more challenging for retailers because some of them already think about right, July 4th, I mean, we're talking about back to school right now.

And so I think those are some of the challenges that retailers are facing to try and be relevant.

And that's when you talk about the online the offline experience, right?

We don't want back to school right now in the north, but in the south, it's probably a pretty important message to be getting across.

I think retailers are doing a great job utilizing technology, whether it's gen A I predictive and prescriptive analytics to really deliver that custom experience.

And I think, you know, those retailers who are doing a great job of it, Walmart is a great example, right?

They're seeing top results, all right.

Uh a tough district to live in for a lot of the students out there.

Perhaps if you're going back to school in July, I I don't know, maybe they like it.

Who knows?

Deborah?

Thanks so much for taking the time here today.

I really do appreciate the time and insights.

Thank you coming up.

Everyone.

Jobless claims rose in the last week.

We have tips for job seekers.

On the other side of this short break, initial jobless claims for the week ending May 25th rose to 219,000.

That is above what analysts had expected.

Now, it is an increase of 3000 claims from the prior week's revised level.

That means more people filed for unemployment benefits last week than the week prior.

And the four week moving average for claims is the highest it's been since September.

So if you're out there looking for a job, we've got you covered here with the perspective on the job market and some tips is linkedin career expert, Andrew mccaskill.

Andrew, great to speak with you.

Great to have you on the program here.

You got a lot of folks out there that are trying to evaluate this broader labor market and understand where there are opportunities and where even they should be reskilling here.

But first and foremost, let's start with what's perhaps top of mind if someone does lose their job or if they voluntarily leave, where should they begin that career search?

Listen, we are in an incredibly competitive job market right now.

I'm just gonna be honest with you.

Um linkedin hiring rate is down 9.5% year over year and that was in April, but it's only down 1% since January and it's really competitive right now largely because you've got early career starters.

It's graduation season.

People are in the market, but we also saw that 32% of Gen Zers said that they are, they plan to change jobs this year and they're going to be competing for those roles too.

I mean, but it's not all doom and gloom.

Right.

I think that they're, despite, you know, the competition, there's still entry level jobs and companies are still hiring literally 32% of the jobs on linkedin right now are for early careers or entry level.

The number one thing I think you've got to do is you've got to prioritize networking, your network will save you sometimes when your resume won't.

So if you got to think about your network is oftentimes way bigger than you think it is.

Reach out to that fraternity brother or that sorority sister or the person that you used to work with, get in the group chat and say, hey, who do we know that's hiring or who do we know at this company where I'm interviewing?

Because you're three times more likely to get a job at a company if you know someone there, even if it's not a work bestie, right?

The second thing is you gotta be open minded and go where the opportunities are.

Education is hiring right now.

Government is hiring, construction is hiring.

We're seeing the job market begin to stabilize a lot more right now.

And a lot of that stabilization is being led by tech information and the media sector.

They're leading that hiring stabilization.

And while the overall us hiring rate has slowed 7.3%.

Since, since July 2023 the hiring rate for technology information and media has accelerated 7.2% within the exact same time frame.

So there's a lot of opportunity that's still out there, but you're gonna have to be really strategic to get it.

Andrew.

I wanna give people some actionable tips because you actually conjured up a thought of mind that I have when I get to any type of networking event, I, I, you know, follow this one Instagram page.

Introverts are awesome and it's like I get to these events and I forget how to speak English.

I don't even know if it's my first language at a certain juncture.

So for people who show up and might have these thoughts rushing through their head of where do I even start a conversation?

How do I make sure that it's giving me the opportunity to set up a network so that I can find that next role that next career, what are some actionable tips that they can deploy?

Sure.

And you don't have to always think about networking as cocktail parties.

And after work mixers, right?

When you look at a a platform like say linkedin, I'm gonna say this even though I work there, it's like it's a great opportunity for you to expand your network.

So we have tape tools embedded in um linkedin that are a I tools that will help you sort of get that warm introduction email together so that I would say start to do your research where the company you want to work for, um think, start following those companies, start looking for people who actually work at those companies have a game plan, right?

Think about what your skills are and what your superpowers are.

So if you get into that sort of networking scenario that you can start to talk to people about what, what industries you're interested in, what you're really good at, talk to them about connecting with them on linkedin, doing a follow up to say, hey, we met at this function, we had a conversation, keep your eyes open for opportunities in this industry or there were um opportunities for this type of work.

You've got to do that follow up.

If you're not good in person, then maybe you're better on an email and you can use A I tools to help you with those emails.

The number one thing I think you've got to do is tap into your current network to expand your network.

So that I know you and I may be interested in someone who having a conversation with someone who works at another company.

I don't know that person, but I know you and you know that person, I reach out to you and I say, Brad, hey, I'd really like to meet this person.

Could you make a warm introduction for me.

That is how networking and it gets done.

That's how people say, oh Brad says that I should have a conversation with Drew.

Let me have that conversation and do not ask people to pick their brains, like take that out of the lexicon.

This is one of my biggest career advice.

Um Pro tips is busy.

People need specificity.

If you, you're gonna reach out to me and say, hey, I'd like to have a conversation with you about something be specific.

So even if I'm not the person that can best give you the best sets of information for that, I can point you to someone who does.

But if you ask me to pick my brain, I don't know what to do with that.

Yeah, my brain is tapped sometimes after we get off these shows honestly.

Um But you know, all that aside, you got a lot of fresh college graduates out there that are trying to figure out, ok, after I've got this four year, five year college degree that I'm ready to deploy, ready to put into action who might not know anyone, they might not have a network even though they pro we should because they just got the degree or got the trade, uh, certification.

All of these things considered it comes back to.

Ok. What is the wage?

What's the salary that I should feel comfortable negotiating?

What are some negotiation tips as well for fresh grads who might not know anyone but they know what they just learned, they know what they just came out of.

I think that what your information is currency.

So take a look at knowing, try to figure out what the market will bear.

You can get information from professional organizations if there's a student, um version of a professional organization, like, like young engineers or um young journalists associations, things like that can be really helpful, tap into the um into those folks.

People love to help students, right?

The other thing is do not leave that college campus without having a conversation with your alumni affairs organization and talk, go in there and say to them, hey, I wanna work in government who are four or five alums who are in government right now and you tell me who those folks are and I can get an introduction to those people in that way.

Think about it like this, that your professional networks are just not people that you hand out business cards to.

These are people who are rooting for you to win.

It.

Is your community.

So tap into your fraternity and sorority to get um information.

Do your research online?

Ask people now?

Um As you're starting the beginning of that process, how do, how should I be thinking about these roles?

What are the current uh what does the market bear for these roles?

The other thing that I would say is really important for folks to do is go and start looking at those jobs that you're interested in and start looking at job description so that you can match your skills against them.

But also you can start to look at what some of the salary ranges are for some of those jobs because in many states, it's required to have a sal a salary range.

And that will give you a really good idea of what some of these roles and some of these jobs are, are paying the other.

The thing is, is you should have someone in your peer group or your community um that you can rehearse with negotiation is a performance art.

Interviews are a performance art and you need to rehearse before you get into that interview, you need to rehearse what you're gonna say in a salary negotiation before you get into that place, right?

I think those just those things alone can really help somebody get from.

I'd really like to get there.

I think I could get there to that number to, I got to that number and I asked for more and got that too.

Andrew.

Great actionable tips there for a lot of folks who are tapping into the job market and part of the workforce participation.

Andrew.

Great to see you.

Thanks so much for hopping on with me, man.

Absolutely.

Andrew mccaskill linkedin, career expert.

Joining us here on wealth.

Let's also talk a little generation X here.

Gen X has been the alpha tester for the 401k retirement system.

And according to a new Goldman Sachs survey, the gloomy results are rolling in Yahoo.

Finance senior columnist, Carry Hannon has more on this story, Carrie, we wish it was better results.

But what is the reality here?

Yeah, Brad, the reality is that, you know, Gen X and we're talking about these are people this year who are age 43 to 59.

So the first ones are gonna start turning 60 next year.

Half of them say they are behind in the retirement planning and the retirement savings and half of them haven't even started to calculate what they might actually need for the ones who have, we see numbers like, oh, I think I need one point $6 million saved to retire, but right now they only have about 100,000.

So these are kind of startling numbers.

And as you mentioned, this is truly the first generation who have had to rely primarily on 401k plans as their retirement vehicle.

I mean, private pensions, the traditional pension only about 11% of private employers offer those.

Now, it's about a third of the ones that offered it back in the 19 nineties.

So this is a time where, you know, they really had to struggle to do it themselves.

And we're seeing that things like credit card debt and student loans have really held them back in their ability to sock away money for these retirement years.

And in fact, one in three, in one study I saw say they have dipped into the, their, their accounts, uh, even though they're behind, they've dipped into them in order to pay bills, monthly bills.

So it is a bit concerning and the younger generations coming behind them have a couple of things in their favor.

So it might just be this, this generation really, uh, got stuck.

We call it the forgotten generation, but younger ones now have auto enrollment in their 401k plans and auto escalation.

These are things that weren't around when the Gen Xers were getting started in the workplace.

And so what can employers do to help Gen X and, and what have they done so far that's making the future potentially brighter for, for other generations as well?

Yeah, I love that.

It's good to, it's good to look at the, the upside of this and in fact, employers have started to do some of these things and we need more of it, particularly for Gen Xers, which is offer them some financial advice or access to financial planning to help them get a grip on this.

Um, you know, really find ways that they can, uh, there's now options to set up emergency savings plans right there through your retirement plan.

If they can help them start to set aside that kind of emergency savings, then they don't dip into their plans.

And a lot of people are asking for guaranteed income retirement solutions.

So that when they do retire, they have an access to something similar to uh a what a traditional pension plan used to be.

These are all fairly new, but the things that are seem to be helping is this auto escalation that I mentioned before and the auto enrollment.

So employers are starting to get a grip on getting people started because as we know, Brad, you know, this, well, the earlier you can start saving in these plants, even if it's a small amount compounding over all those years makes a huge difference.

Carrie, thanks so much for jumping on with us.

Yahoo Finance's own carry Hannon.

Do you know if you have enough money in your savings account?

Big question there.

A tiktoker recently answered that key question.

Can we normalize telling each other what our savings accounts are?

Because I really wanna know, I feel like I see people saying like they have no savings.

I feel like I see people having insane savings and I just don't know what the normal is and while discussing your savings balances publicly is an individual decision, we wanna find some answers of our own.

Yahoo finance contributor, Ross Mack joins us now to help answer all of your savings questions.

Hey, Ross Brad, how you doing, man?

I uh I happen to be on tiktok quite a bit and I saw this one going viral and the more interesting one that I saw that someone actually did a duet to that effectively saying let's not just talk about savings, let's talk about retirement.

And I think, you know, our generation now now that we have more social media, everybody is now have having and willing to have these open dialogues.

Right?

I think back when I was first, you know, getting into the workforce, these type of conversations were taboo.

Right.

I never knew exactly how much I should be contributing to my 401k.

I just heard, like, just do what you're employer matches, but I never knew exactly how much I should be going even beyond that.

So I think it's a great one, great conversation to start having.

But two, I think it's something that we should actually talk about.

Right.

I think it's troubling when you see that more than 50% of Americans feel as though they're not ready to actually have a comfortable retirement.

A and so with that in mind, I mean, have we adequately mapped out where everyone should be or the percentage that should make people comfortable with how much they're putting away in savings?

Absolutely.

Right.

So according to fidelity, by the time you reach the age of 30 you should have one times your actual salary.

So if you're making $80,000 guess what you need to have about $80,000 in your different retirement accounts.

Right.

By the time you reach 40 we're talking three extra salary, by the time you get 50 we're talking six extra salary, 68 X and then 6710 X.

And so the idea of thinking about this and obviously, another method is the fire method where it's literally saying, you wanna have 25 X, your actual annual expenses.

And the way you wanna think about this is just saying, ok, how am I able to live comfortably by literally keeping my money invested and whether I'm just living off my dividends or, you know, capital gains, et cetera, that is the way you want to think about that.

And so obviously, right, the best time to plant a tree was 20 years ago.

The second best time is actually today.

And the idea is that sure you might feel as though you're behind, but it's never too late to actually catch up.

And so you ask yourself, how do you get to those numbers?

Well, one, you, you want to the target that I say you need to at a minimum be saving A K A investing roughly 15% of your actual uh your actual revenue, right?

That being your salary.

And then after that, I think another thing to take advantage of is just other tax advantage, retirement accounts, right?

So if your employer is willing to match you call it, I don't know, 5% right, max that out.

But another thing to think about is, hey, we don't know what our ta the tax plan will be once we get to that retirement age.

So I love the idea of also opening a rough ira where that money, what you see is what you get because you would have been, that money that you're invested has already been taxed.

Another thing you just want to automate your savings slash investing.

Right.

I think, you know, people can feel a little anxious when it comes to retirement but everything, you know, if you have your own retirement goals, it's gonna boil down to what you're doing today to ensure that you are gonna be comfortable once you get to that retirement age, right?

We're living a lot longer.

So, so the good thing, right?

We're living longer, but the bad thing is, hey, now you need a little more money when it comes to retirement.

Certainly y'all, finance contributor, Ross Mack.

Thanks so much.

Thank you.

Good stuff up next.

Consumers are pulling back, especially when it comes to eating at restaurants.

We're speaking to the Red Robin Gourmet Burger Ceo on the state of the consumer coming up, consumers are stretched 80% of people think fast food is a luxury according to a lending tree survey.

And that's hitting companies mcdonald's Starbucks and KFC parent company, Yum brands all report seeing consumers pull back.

And this week Red Robin Gourmet Burgers reported earnings where the company is saying that inflation is weighing on its diners to break down how consumers are faring GJ Hart, who is the Red Robin Gourmet Burger Ceo is here with us.

Thanks so much for hopping on and you gotta break down some of what you're seeing among consumers here for us.

GJ.

Sure.

First of all, good morning to you, Brad.

Great to be with you.

And uh uh thanks for having me on.

You know, we're in the middle of a, a comeback is what we call it and, and um in what we call our strategic plan as the North Star plan.

And so we see a little different than, than the backdrop of what's going on in the overall economy because we're really driving back to some fundamentals of this iconic brand.

And so what we're seeing right now is we're seeing a great uh uh take rate of our Gourmet burgers, which by the way, we've improved 85% of our menu with higher ingredients.

And we're seeing a great take on the, the upper end of that, that uh menu pricing are um more value oriented tavern burgers.

We're also seeing a great take, great.

So we're seeing some trade down to tavern burgers, but that's ok because, you know, again, we have great value with 30 bottomless sides.

So, um we're, we're seeing that and then at the same time, we're seeing things like add ons and salads and, and uh appetizers, desserts, we're seeing those hold steady.

So I'm not sure quite what that says.

But what I will say for us it's just given us some confidence that uh and as we reported positive sales for the first uh five weeks of the second quarter, we feel some good momentum.

But again, I think it's a little different for us because we are in this comeback.

I mean, you have companies out there competitors in this landscape that are saying, hey, we'll throw avocados on the burger, hey, we'll throw, you know, crispy onions on the burger.

We'll, you know, Tinker with our fresh never frozen beef patties, all of these things that are really the jousting efforts in your industry is it just becoming harder to innovate on top of the burger, especially in an environment where consumers are looking for value.

Well, innovation is a key part of any restaurant brand.

You have to have that to, to stay relevant.

But so and at Red Robin, we've been known for burger innovation for many, many years.

So for us, I wouldn't say that's hard.

Um But what I will say is that we have a value.

Our check average is a little over $17 and it's a full service experience.

It's not fast food or fast casual.

So it's, you get the whole experience.

It's a fun environment.

So for 17 bucks, we think that's still a good value.

In addition to that, we have 30 bottomless sides that most consumers don't even realize because if you talk about bottomless, they think bottomless fries.

Well, we have 30 items that are bottom, which is everyday value versus just, you know, price promotions.

One after another, like many of our competitors are doing, we think it's better to be 52 weeks a year and providing value to our guests.

So, you know, when you, when you look at it that way, we think that ultimately, again, our, our consumers saying that with what we're seeing in the momentum of our, of our comp store sales.

So um we think we're doing the right thing.

All right, I'm about to come post up at a Red Robin and uh bake in some of those Bob newest fries to my financial planning.

For sure.

Here GJ, you know, as you, as you think about what you're hearing from your franchisee partners as well, what are they looking for from Red Robin and its leadership as they're trying to continue to keep the pulse of the consumer and engage across so many different regions.

Well, first of all, it's open communication, transparent communication, aligning around our mission, vision and values and what our North Star plan is trying to achieve.

We have a really great group of franchise partners.

They're great partners and they operate phenomenal restaurants.

And so, you know, making sure that we're totally aligned and communicate their desires are again to, for us to continue to be out there promoting value, innovating, value, innovating uh the you all the time, but also staying the course, staying the course where historically, the company hasn't always done that.

And so, you know, with us and this North Star plan, we're staying true to which what we're doing, which candidly, you know, that's investing in more labor, it's providing better hospitality, better, better experiences for our guests.

It's it's improving our burgers.

As I said, 85% of our menu has been improved.

We are continuing to focus on those fundamentals that get us back to the, to the essence of what this iconic brand has done for so many years to be in a place where we've got over 500 restaurants all over America.

So I think that's what they're asking for.

And, and again, I think more than anything is that open communication and listening to what their needs are and responding to those appropriately.

GJ Hart, Red Robin Gourmet Burger Ceo.

All right, I'm officially hungry, so we gotta leave things there.

Thanks so much for, I love to have you.

Absolutely.

Absolutely.

Thanks so much.

Coming up everyone.

Main Street versus Wall Street, we dig into how Americans view the economy versus their own personal financial situation.

That's next.

It seems like a daily occurrence that we see data that shows Americans are skeptical of economic growth in the near future.

But how do Americans feel about their own personal financial situation?

Well, a new survey from KPMG shows that despite headwinds on the economy as a whole, Americans are much more optimistic about their own personal financial situation to help explain.

We welcome in Matt Kramer kpmg us products line of business leader.

Thank you so much for taking the time.

You gotta break down some of these results for us here.

How are people feeling and households feeling about their own personal economy if you will?

Yeah, kind of coming out of the survey, we're, we're talking about compound complexity because so many things coming at the consumer in this day and age, it's definitely the economic conditions and inflation, um the energy transition, uh digital future and gen A I.

But um, the great news is they are still optimistic and I think, um, that's really encouraging.

Now, one of the things we're really pointing to is the strength of the labor market.

The, you know, 8.5 million jobs that are still out there and unfilled, still down a little bit from the 12.2 peak, but really exciting also that wages are holding.

So I think that's giving consumers the confidence that, you know, we can definitely, um, have a disposable income that will pay for vacations, pay for dining out.

Um Certainly, um, some of the things that they like to enjoy like shows, although maybe not the top end shows, but certainly some of the, the shows that they enjoy uh this summer.

So that's really encouraging that the um head ones, you know, that, that, um, um they're, they're facing is, can I really, um do that large purchase can um with the interest rate environment, can I get into, you know, the home buying situation with the, the prices still being really high or those large purchases like automotives?

That's where it's really going to be interesting to see how it plays out.

Yeah.

Where are people prioritizing purchases right now?

I mean, we're, we're talking about a backdrop where the services side of inflation has remained sticky, but for the good side, people have clearly decided, ok, as evidence through earnings, like we saw on Best Buy, they're prioritizing not purchasing that next big screen TV or home theater or appliance.

And instead saying, ok, I'm paying a little bit more for groceries or other things.

So what are the little add ons that I can still prioritize in the meantime, where, where's the data kind of seeing that net out?

Yeah, I think, I think um what's really telling in the survey is, you know, consumers have been trained over the last couple of years to deal with inflation.

So 65% in our survey say that they're gonna spend more on discount stores.

They're they're finding categories and certain aspects of their budget that are perfectly comfortable with discount shopping.

And really telling in that number in the 65 is 60% that are above the 200,000 income bracket.

So even the high end are really comfortable with private label brands, discount brands and that's allowing them to put money away for the things I mentioned earlier, like enjoying their summer vacations, enjoying dying out, enjoying um activities and events with their friends and family.

What are we seeing in terms of the differentiation across generations?

Where are different generations prioritizing uh buying into specific experiences or even where they're focusing a lot of their own expenditures?

Yeah, I think that's uh and that actually gets into the digital side of, of our survey is, you know, I think um what consumers expect is a seamless experience from, from retailers is when they look at shopping, they want to have all channels available.

So they want to be able to shop in store, they want to be able to shop online and they're really getting into social commerce.

So I think one of the really interesting things um is the Gen Z category is they're very comfortable shopping and social commerce and they're very comfortable.

Um also um being in the store.

So um the second highest category after baby boomers, as far as those that want to shop more in store was Gen Z.

So I think it's uh really telling to uh companies that they need to be prepared to serve their customers across all those channels um and be prepared to find the categories that are most interesting to them.

Matt.

Uh we could talk about this for days, Matt, we gotta leave things there though.

Matt Kramer, who is the KPMG us products line of business leader.

Thanks so much for helping break down some of the survey results for us.

Thanks for having me.

Certainly coming up everyone.

We have a new challenge for you that may help you save some money.

Yahoo Finance is Michelle Kuo has the info for you after the break.

If you find yourself saying, I don't know where my money went.

This is for you.

The no spend challenge is making the rounds again on social media and it's all about challenging yourself to avoid spending money on non essentials.

So we're not talking about your rent, your mortgage raise, medical, et cetera.

Joining me now with a breakdown of this is our very own.

Rochelle Auo.

I I thought it was just, you know, an era of, you know, treat yourself on occasions or ball on a budget, but you're talking about no spending at all here, Rochelle.

That's right.

No more treating yourself to fine leather goods.

It's just in time for summer.

People want to be more attentive to their spending, especially with a swipe of a card or a tap of the screen making it so easy for us to spend.

So let's break down the five steps of the no spend trend.

First of all, set your goal, decide your timeline, define your spending rules plan for pitfalls and of course be accountable.

So let's start with setting your goal.

Now this be a specific dollar amount or this could be a pledge to pay down a certain percentage of your debt or even saving up for a down payment for a house or a car, et cetera.

Well, make sure you make it clear and achievable next, you're going to decide your timeline.

Now, some people are doing this for a year.

That's quite ambitious.

I recommend if you're new to this, starting up with a short amount of time, perhaps 2 to 3 months so that you've got a few paychecks and bank statements under your belt.

So you can really assess your spending without getting discouraged that you can't do it for a year.

Think of how we've all done with our New Year's resolutions.

So the next part is to define your spending rules.

So once you take essentials out of the equation, you have to define what your unnecessary purchases are and whether you're going to remove them completely or perhaps limit them to a certain number of months.

So I think clothes, shoes, brunch, food, Uber eats, you know, hypothetically, of course.

So you have to think of all those things that you tend to spend money on that aren't your essentials.

So then that brings us to planning for pitfalls.

You have to know your kryptonite, know yourself, avoid putting yourself in spending situations that will throw you off course.

So if you know that you're trying to save money, don't be out there in the sales at the mall, just just keep your distance from these things.

And most importantly, of course, be accountable every time you have the urge to and decide if it's a need versus a want and whether it's getting you closer to or further from that goal, it might help to have an accountability partner, perhaps a friend, a tweak as needed if you have say a financial emergency.

But get back on track.

Don't get discouraged because this is really about really paying attention to how you're spending, man.

You, you were really stepping on toes out there with this one, Michelle.

So what tips do you have to help people stay on track.

I mean, I know it's not easy.

It's one of those things you think of like doing your resume.

Nobody wants to have to look at their finances, but look the cheapest option.

The old fashioned way you get a look at your bank statements, get a notebook app or an Excel spreadsheet go through them.

It's miserable.

It's time consuming.

Nobody really wants to do that.

So there are a number of apps that can also help depending on how you like to save.

So I like rocket money that gives you a really great snapshot of your subscriptions as well as upcoming bills and your spending at specific stores.

I got a glaring one telling me how much I spent on Starbucks.

It was not pretty that alert also recommend Pocket God.

That's a simple way to track your spending and Honeydew is interesting because that's for people who want to budget with a partner.

Now, you still get to decide how much info you share with them and you get alerts when you're both coming up against your spending limits.

Now, for people who are a little bit better with their budgets, there's also zero based budgeting.

That's when all your money, your assets, your debts are all accounted for every dollar.

And it's also forward looking when it comes to some goals that you perhaps want to take that money you saved and put it into something else for that.

There's every dollar and YNAB which stands for, you need a budget.

All right, don't be out there getting gripped up by these $10 lattes, Michelle.

Thanks so much.

I'm trying.

It's hard that we all are.

Thanks so much Michelle.

Appreciate it everyone.

That's it for wealth.

I'm Brad Smith.

Thanks so much for watching.

We'll see you tomorrow Friday at 11 a.m.