TIME Saving & Spending

The Disastrous Black Friday Mistake You Must Avoid

Money in jeans pocket
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Shop smarter—or else pay for the consequences

Going into the holiday season with a budget is a good start, but it might not be good enough. A new study shows that misestimating how much of a deal they’ll get on Black Friday and underestimating how long it will take them to pay off their holiday splurges will cost American shoppers.

According to the National Retail Federation, the average holiday shopper spent a little less than $770 last year. It predicts a total increase in Americans’ holiday spending of just over 4% for this year.

But shoppers could find themselves with sticker shock, a new study from NerdWallet.com warns. And middle-class shoppers could bear the brunt of it. According to a survey conducted by Harris Poll for NerdWallet, families in the $50,000 to $75,000 income bracket won’t pay off their debts for an average of nearly three months. Poorer families will pay off their debts a little more quickly, in an average of two months.

Odds are, even these estimations are optimistic. Other studies show that people tend to take longer to pay off their holiday bills than they anticipate. And, odds are, many of these shoppers aren’t starting from scratch but adding onto an existing balance — one that averages nearly $16,000, based on NerdWallet’s look at household credit card debt.

And the cost of servicing that debt keeps going up. The average APR on a general-use credit card is a tick under 16%, according to Bankrate.com. For store cards — you know, the kind many of us open over the holidays to get the one-day discount on purchases — it’s even higher. They have an average APR of over 23%, higher if you have marginal credit.

New data from Experian shows that more of us are signing up for those store cards and the higher rates they charge; both the amount we borrow and the number of cards we have has risen over the past year.

“Middle-class households can fall into a costly situation this holiday season, where they’ve been extended ample credit but have incomes too thin to comfortably pay the bills later,” warns NerdWallet senior retail analyst Matthew Ong. “Many are still struggling to reconcile a typically middle-class standard of living with stagnant incomes,” he says.

Adding insult to injury, NerdWallet also finds that those Black Friday deals many of us think we’re going to score might not be so hot after all.

In an analysis of 27 major retailers’ ads, more than 90% of them listed “sale” prices identical to last year’s Black Friday prices. This isn’t always apparent at a quick glance; the site found that retailers use tricks like misleading original prices and make shoppers jump through hoops like requiring mail-in rebates.

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TIME Saving & Spending

The Problem With Millennials, In One Staggering Statistic

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It's almost unbelievably bad

New data about how much debt today’s students are graduating college with just came out. The results are ugly, but that’s not the worst of it.

The Project on Student Debt conducted by The Institute for College Access & Success says the average debt load carried by last year’s crop of four-year nonprofit college grads is $28,400. That number is several hundred dollars higher than last year and roughly ten grand more than the average a decade ago. Roughly seven in 10 students today graduate with debt, a figure that has ticked up in that time period, as well.

This number would likely be even higher if for-profit colleges, which were included in previous tallies but left out this year because many failed to provide data, were included, since their students tend to leave school burdened with debt at a higher rate — 88% indebted with at average of nearly $40,000 in 2012.

That’s bad — but that’s not the problem. You might think these young adults would be worried about paying off a new car’s worth of debt they’d accrued before getting their first full-time job.

Nope.

A new study from Junior Achievement USA and PwC US conducted by Ypulse finds that 24% of millennials think their student loans will be forgiven.

“It’s a scary statistic,” Junior Achievement president Jack Kosakowski tells CNBC. The survey doesn’t explore why roughly a quarter of young people have such an optimistic — and for the majority, unrealistic — expectation.

In many cases, the payments they expect to be forgiven are significant. “Loan payments are also rising, taking a significant chunk out of Millennials’ pay checks when it comes time to pay up post-graduation,” the report accompanying the survey says. “One-third of those with student loans are shelling out over $300 per month and five percent are actually paying more than $1,000 per month.”

Although 60% of respondents to the PwC/JA survey say financial aid is a consideration in their school choice, the survey also finds that today’s high school seniors are relying on an average of just over $8,200 in contributions from their parents and more than $6,600 in student loans to help fund their first year’s tuition. Their average contribution from savings or earnings: less than $1,400. (These students also spent almost $200 of their own money, on average, on back-to-school shopping. School supplies, followed by clothes, were the most common purchases.)

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TIME Saving & Spending

5 Ways Money Can Buy Happiness, Backed by Science

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You have to be a spend wisely, though

The old saying that money can’t buy happiness? Not true, it turns out. But you have to spend strategically if you expect the Benjamins to put a smile on your face.

Buy moments, not stuff. According to Dan Gilbert, Harvard University psychology professor and author of Stumbling on Happiness, the key is to spend your money on experiences rather than material things. Material things, even if they’re expensive or you wanted them badly, tend to lose their luster after a while, literally and figuratively. Memories of people, places and activities, however, never get old. In a survey, Gilbert found that 57% of respondents reported greater happiness from an experiential purchase. Only 34% said the same about a material purchase.

Spend on others. In a study published this year, Harvard University researchers conducted experiments and found out that spending money on others (called “prosocial” spending in academic jargon) boosts people’s emotional and physical well-being.

“The benefits of prosocial spending… extend not only to subjective well-being but objective health,” they write. Despite people’s intuitions and inclinations to the contrary, one of the best ways to get the biggest payoff personally from a windfall of $20 is to spend it prosocially.”

Buy small splurges. Dropping a ton of cash on someting extravagent doesn’t give you the same bang for your buck because, no matter how special it is at first, you get used to having it over time and it becomes just another object. “Giving yourself inexpensive indulgences is a clever way to gather up lots of bursts of happiness,” a recent Business Insider article suggests, citing Gilbert’s research.

Buy what you like. No keeping up with the Joneses — that’s not going to make you happy. “There are a lot of reasons someone might buy something… but if the reason is to maximize happiness, the best thing for that person to do is purchase a life experience that is in line with their personality,” Ryan Howell, an associate psychology professor San Francisco State University, tells Forbes. Howell recently co-authored a study finding that when people spend money just to project or uphold a certain image, it doesn’t bring happiness.

Spend with others. You might think spending money on things or activities you do by yourself will make you happy, but a recent study in Psychological Science says that tactic can backfire. “To be extraordinary is to be different than other people, and social interaction is grounded in similarities,” says Gus Cooney , Harvard University research assistant and lead author of the study.

Doing things with friends or family, even if it’s not as exciting, makes you happy because it fosters a sense of togetherness and connection between you and other people. “The guy who had the extraordinary experience had a harder time fitting in,” Cooney tells The Atlantic.

TIME

This Is the Most Depressing Number in Personal Finance

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Getty Images

It's the shocking amount we spend to be in debt

How much do you think you’ll spend servicing the cost of borrowing on credit over the course of your life? A few thousand dollars? Maybe 10 or 20 grand? The real amount will floor you.

How about almost $280,000 ($279,002, to be exact). In many parts of the country, that’s enough to buy you a house and a car. It’s more than the $245,340 the government estimates it will cost to raise a child born in 2013. And this is for people with middle-of-the-road credit scores. If medical bills or a job loss torched your credit, you could be paying much more for the privilege of borrowing money.

A lot of people only think about their debt in monthly terms — how much their mortgage or car payment is, or how much they need to pay to make the minimum payment on their credit cards. But a new tool from Credit.com pulls back the curtain and shows how much we’re really paying over time.

The penalty for having poor credit is steeper than the benefit that comes from having good credit. “If you have really bad credit, you’re at a definite disadvantage,” says Gerri Detweiler, president of consumer education at Credit.com.

According to Credit.com, somebody with top-notch credit would pay $209,590 in interest, while people with bad credit would be on the hook for $369,054, on average. “However, this is over an entire lifetime and everyone has the opportunity for a fresh start,” Detweiler says. Even bankruptcies come off your credit file after 10 years, and most other negative information doesn’t last that long.

Those figures are national averages; the calculator lets you add in where you live, what range your credit score falls in and details about your debts. Playing around with the variables can show you, for instance, how much you might be able to save in interest payments if you hang onto your car for a few more years, put a little extra towards your mortgage principal or credit card balance every month, or take steps to pull your credit into a better tier.

One thing the tool doesn’t do, though, is factor in the enormous amount of student loan debt many Americans today carry. For the more than seven in 10 students who graduated with an average of $29,400 in debt in 2012, according to The Institute for College Access and Success, that amount can inflate quickly if loans are deferred or put into forbearance.

“For some students, their student loan is like their mortgage,” Detweiler says.

TIME Saving & Spending

The 10 Most Livable Countries in the World

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A surprising number one pick

This post is in partnership with 24/7 Wall Street. The article below was originally published on 247WallSt.com.

Based on the most recent release of the Human Development Index by the United Nations Development Programme, 24/7 Wall St. reviewed the most and least livable countries. Data from the Human Development Index is based on three dimensions of human progress — having a long and healthy life, being knowledgeable, and having a good standard of living. According to the index, Norway is the most livable country in the world, while Niger is the least livable.

One factor that influences a country’s development is its income. The U.N. used gross national income in its calculation of the Human Development Index to reflect the standard of living in a country. In the most developed countries, gross income per capita is generally quite high. All of the world’s 10 most livable countries had among the top 30 gross national incomes per person. The top-rated country, Norway, had the world’s sixth highest gross national income per capita of $63,909.

At the other end of the spectrum, the world’s least developed countries typically had very low incomes. Six of these 10 least livable nations were among the bottom 10 countries by gross national income per capita. The Democratic Republic of the Congo, which had the lowest gross national income per capita in the world, at just $444 last year, was the second least developed country worldwide.

Click here to see the 10 most livable countries

Similarly, these countries also generally had extremely high percentage of their populations living on just $1.25 a day or less, adjusted for purchasing power. In the Democratic Republic of the Congo and in Burundi, more than 80% of the population lived on less than $1.25 per day.

Life expectancies, another factor considered in the Human Development Index, were also far better in highly developed nations. Switzerland, Australia, and Singapore were all among the top rated countries with life expectancies greater than 82 years for individuals born in 2013. By this metric, the United States is a relative laggard. The median life expectancy at birth in the U.S. of 78.9 years was ranked just 38th worldwide.

For individuals born in the world’s least developed nations, the average life expectancy was far lower. In all but one of these nations, a person born in 2013 had a life expectancy of less than 60 years. Sierra Leone, the fifth-lowest ranked nation, had the worst life expectancy, at just 45.6 years.

Sadly, among the factors contributing to these low life expectancies are, almost certainly, high mortality rates for infants and young children. Sierra Leone, which had the lowest life expectancy, also had the highest mortality rates for infants and children under five, at 117 deaths and 182 deaths per 1,000 live births.

Education also plays a role in determining development. In all but one of the most developed countries, residents aged 25 and older spent an average of more than 12 years in school. By contrast, in all of the world’s least developed countries, adult residents had less than four years of education on average.

ALSO READ: America’s Most (and Least) Educated States

The most and least developed nations also tend to be clustered geographically. Five of the 10 most developed countries are located in Europe. All of the least developed nations, on the other hand, are located in Africa, where political turmoil, health crises, and lack of infrastructure are far more common.

Despite their low scores, however, several of the world’s least developed nations have worked towards improving their economies in recent years, and their Human Development Index scores have improved as well. Mozambique is perhaps the best example. While it is still the 10th lowest rated nation, its score had risen by 2.5% per year between 2000 and 2013, faster than almost all other countries globally. Burundi’s score also rose substantially, by 2.3% per year in that time.

To identify the most and least developed nations, 24/7 Wall St. reviewed the latest Human Development Index figures published by the U.N. The index included three dimensions made up of select metrics. The health dimension incorporated life expectancy at birth. The education dimension was based on the average and expected years of schooling, for adults 25 and older and newly-enrolled children, respectively. The standard of living dimension was determined by gross national income per capita. We also considered other statistics published by the U.N. alongside the index, including inequality measures, mortality measures, poverty rates, and expenditures on health and education as a percent of gross domestic product (GDP). All data are for the most recent period available.

These are the most livable countries:

1. Norway

> Human Development Index score: 0.944
> Gross nat’l income per capita: $63,909 (6th highest)
> Life expectancy at birth: 81.5 years (13th highest)
> Expected years of schooling: 17.6 years (6th highest)

According to the Human Development Index, no country is more livable than Norway. Relative to the country’s population of just 5 million, Norway’s economy is quite large. Norway had a gross national income of $63,909 per capita last year, more than all but five other nations. Oil revenue has helped Norway become quite wealthy and accounts for a majority of the country’s exports. Like several other highly-developed countries, and Scandinavia in particular, 100% of retirement age Norway residents receive a pension. Norwegians also enjoy particularly good health outcomes. There were just two deaths per 1,000 live births in 2012, tied for the lowest infant mortality rate.

2. Australia
> Human Development Index score: 0.933
> Gross nat’l income per capita: $41,524 (20th highest)
> Life expectancy at birth: 82.5 years (4th highest)
> Expected years of schooling: 19.9 years (the highest)

Australia had one of the longest life expectancies in 2013, at 82.5 years. Residents 25 and older had also spent more time in school than adults in any other country, at 12.9 years on average as of 2012. Australia’s per capita gross national income of $41,524 last year was roughly on par with other highly developed countries. Additionally, at 5.2% last year, the country’s unemployment rate was far lower than similarly developed countries in Europe as well as the United States. Australia’s economy has benefitted tremendously from a mining boom in recent years, although the economy is currently rebalancing as iron ore prices have dropped and gorwth in China — a major trade partner — has slowed.

3. Switzerland
> Human Development Index score: 0.917
> Gross nat’l income per capita: $53,762 (9th highest)
> Life expectancy at birth: 82.6 years (3rd highest)
> Expected years of schooling: 15.7 years (28th highest)

Known for its political and economic stability, Switzerland also had the third highest life expectancy out of all countries reviewed, behind only Japan and Hong Kong. Switzerland’s gross national income was $53,762 per capita in 2013, higher than all but a few countries reviewed. Switzerland also scored among the highest in terms of gender equality, with exceptionally high female labor participation and educational attainment rates. In addition, there were less than two teen pregnancies per 1,000 people reported in 2010, nearly the lowest adolescent birth rate. Foreigners, however, may not necessarily have option of moving to this highly livable country. Switzerland, which is not part of the European Union, recently approved quotas and other controls on immigration.

4. Netherlands
> Human Development Index score: 0.915
> Gross nat’l income per capita: $42,397 (17th highest)
> Life expectancy at birth: 81.0 years (18th highest)
> Expected years of schooling: 17.9 years (5th highest)

The Netherlands is among the more equitable countries measured by the United Nations, with a Gini coefficient far lower than that of the United States and a number of other highly developed nations. The country also scored well in gender equality due to its low maternal mortality rate, low teen birth rate, and the high level of female representation in parliament. Last year, 37.8% of representatives in parliament in the Netherlands were women, well above the 18.2% in the U.S. Congress.

For the rest of the list, please click here.

TIME Saving & Spending

The Secret to Getting a Ridiculously Cheap Thanksgiving Flight

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Every travel agency is saying something different, but there are some tips that aren't up for debate

For years, travel search engines have scoured through their dense databases to determine the best day to book your Thanksgiving flights. This year, like every year, there’s a lot of mixed messages on what to do if you’ve procrastinated on booking tickets. Here’s what the big players are advising for cheap domestic U.S. air tickets:

  • Kayak: Book in early November, about two to four weeks before Thanksgiving.
  • Skyscanner: Two weeks prior to Thanksgiving.
  • Orbitz: This Wednesday, Thursday or Saturday. If not then, then before Nov. 18.
  • Cheapair: It depends on way too many things.

So what’s the takeaway? It’s better to be safe and book flights now, but you if you’re a risk taker, you can wait until the beginning of November to book your flights. But try not to wait until the week of Thanksgiving. It’s also important to weigh the risks of an unexpected fare hike in light of what your benefits of waiting actually are. These hyped “savings” are usually only about 5 to 10% less than the average fare, which amounts to $15 to $30 if your ticket costs $300.

In fact, since airline fares are notoriously difficult to understand, often the better question to ask is what not to do when you’re booking Thanksgiving flights.

Here are a few tips that travel search engines all agree on:

Don’t book a departure flight on the Wednesday before Thanksgiving (Nov. 26), or a return flight on the Sunday after Thanksgiving (Nov. 30).

Airfares increase as flights get fuller, and the Wednesday and Sunday flanking the Thanksgiving holiday are when the most people are traveling. A simple airfare search shows just how much more expensive it is to book travel on one of these days. In some cases, fares are up to twice as high.

If you have to book for Wednesday or Sunday, then book your tickets as early as possible.

If you’re locked into a Wednesday departure flight, aim for a Friday or Tuesday return flight, which is around 25% cheaper than returning on Saturday, Sunday or Monday, according to an analysis by Cheapair.

Booking a return flight on Sunday results in the most dramatic airfare spike, and there’s not really much you can do to save money other than to book your departure flight on Thanksgiving Day. But the tradeoff of sacrificing a chunk of your holiday is a discount of only about 10%, so it may make more sense to pick a different day—even if it’s Wednesday. In general, having a Sunday return flight means you’re stuck with a sky-high ticket price.

Consider booking a departure flight or return flight on Thanksgiving Day—or both.

If you depart and return on Thanksgiving Day, your fare may be up to 30% cheaper than the average price, according to Kayak. And even if you only depart (and not return) on Thanksgiving, those savings are particularly meaningful when applied to longer, more expensive flights. For example, flying the JFK-LAX route departing on Thanksgiving instead of the day before can save you nearly $100.

Don’t book flights in groups.

If you’re booking as a family and there are only a few flights left in the lowest fare category, it’s possible the airline will bump the entire party up to the next fare category, according to Cheapair. That doesn’t mean you can’t travel as a family, though: you just might have to book each person’s ticket individually.

Check other smaller airports nearby.

There’s often regional and even international airports near the ORDs, JFKs and LAXs of major U.S. cities. If you’re in Chicago, for example, consider Chicago Midway Airport instead of O’Hare; if you’re in Los Angeles, consider Long Beach Airport instead of LAX. Both are cheaper airports than their neighboring giants, according to Cheapflights.com, which ranked the nation’s 101 most affordable airports.

Check smaller airlines.

The five biggest U.S. airlines—American, United, Delta, Southwest and JetBlue—all increased their base fares slightly despite lower fuel prices and a worldwide fear of Ebola. While the effect on consumers is not yet clear, it’s also worth checking out smaller airlines like Spirit, Frontier and Virgin.

Read next: The Old Advice on When to Buy Flights Is Wrong (And So Is the New Advice)

TIME Food & Drink

Here’s Why Millennials Need to Learn to Love Frozen Food

Why Millennials Need to Develop a Taste for Frozen Food
Evan Sklar—Getty Images

Though they have an aversion to it, they'll find it'll be a staple in the elderly care programs they will eventually join

On Oct. 21, senior citizens in Merrimack, N.H. participating in the Meals on Wheels service waited eagerly to be delivered platters of frozen turkey meatloaf with mashed potatoes, corn, kidney beans and flax-seed bread. Those with slightly more traditional palates opted for a dish of liver and onions—frozen, too. But tell any millennial about the menus of programs like Meals on Wheels, a global delivery service of mostly frozen dishes to the elderly, and the response isn’t likely to be as welcoming.

It’s no secret that millennials have an aversion to frozen food. The marketing of TV dinners targets empty nesters, and those dropping frozen meals in their grocery carts are getting older and older. Younger generations are instead flocking to services like GrubHub, which delivers hot restaurant meals, or AmazonFresh, recently launched in New York City, which delivers fresh groceries.

In fact, research suggests that millennials have a fear of the lifestyles commonly associated with frozen food eaters: lonely elderly people whose only social interactions are with delivery volunteers, or physically limited seniors who stockpile food in the freezer in lieu of grocery shopping. Millennials have made it a goal to avoid that kind of life, studies say. According to a report by Edelman, millennials distinguish themselves from Generation X and the Baby Boomers by living more often with others, a testament to a shared fear of being alone. And a collective desire for a healthy lifestyle has made them more conscious in resisting the forces of aging, according to research by Nielsen and the National Marketing Institute.

The inescapable reality, though, is that someday millennials will age. While millennials’ preferences for convenience and health have driven the evolution of online food delivery services, the options for seniors, particularly those who are alone, low-income or face dietary restrictions, remain unchanged.

Part of the reason is science: flash freezing meals not only is convenient, but it also prevents bacterial growth, according to Greg Miller, CEO of Magic Kitchen, which serves many elderly customers. Additionally, Miller said that when thousands of dollars are spent to analyzing their specially-made meals’ nutritional content, freezing the meals is often the only viable option for elderly who require, for example, a week’s supply of low-sodium meals. “There’s always going to be a need for this particular group of individuals,” says Ellie Hollander, CEO of Meals on Wheels, which partners with companies like GA Foods and Golden Cuisine to craft similarly specialized meals. “That’s not going to be replaced by [online food delivery services]. That’s just a fact.”

Still, some reports have argued that America’s “love affair” with frozen foods is over. That may only be true for the commercial frozen food industry, which includes brands such as Lean Cuisine, Marie Callender’s and Healthy Choice. The industry’s sales are in decline: U.S. revenue fell 2% between 2013 and Aug. 2014, the first drop in recent years, according to Nielsen data. Similar to research on millennials’ preferences, a 2012 survey found that shoppers were turning away from commercial frozen food for nutritional reasons. But that doesn’t mean the demand for senior services’ frozen foods—meals individually tailored to dietary needs—is also melting. It’s actually the opposite: Miller says Magic Kitchen has grown more than 40% year-over-year, while Meals on Wheels now serves over 1 million meals each day.

Part of that demand growth is attributed to fewer federal investments in the Senior Nutrition Programs authorized by the Older Americans Act, which was passed in 1965 to provide community services to elderly citizens. As a result, seniors’ nutrition appropriations, which subsidize meal delivery services, have plummeted since 2009.

The lack of federal funding will only boost the proportion of American seniors who face “the threat of hunger,” which was 15.3% in 2012, according to a recent report by the National Foundation to End Senior Hunger. The percentage, which has risen from about 11% in 2001, also varies widely across state, but the lowest rate is still 8% in Minnesota. (Click on states in the map below to learn their exact rates.)

The figures are perhaps the most unsettling for millennials, some of whom, barring significant changes, will inevitably find themselves someday as senior citizens unsure where to obtain their next meal. Worse, demographic trends are making it harder for millennials to escape this fate. The 60+ U.S. population is projected to double between 2010 and 2050, with the proportions of single-person American households higher than ever, according to the Census Bureau. Meanwhile, the prevalence of cooking meals at home has decreased significantly across all socioeconomic groups since the 1960s, according to NIH research.

In other words, the stars are aligned for some millennials, whether they believe it not, to subscribe in their sunset years to elderly food services that serve frozen meals. And that’s only if they’re fortunate enough to obtain access to programs like Magic Kitchen or Meals on Wheels that carefully craft dishes to meet their nutritional needs.

Still, services popular with millennials now, like GrubHub or AmazonFresh, have the opportunity to remain popular with millennials by tapping into the expanding market of elderly meal services. In fact, both GrubHub and Amazon aren’t opposed to filling the smaller yet critical market of individualized elderly meal plans. “We’ve found that we have a wide range of customers,” an Amazon spokeswoman said in response to AmazonFresh’s target demographic. “Our job is to listen to our customers, invent on their behalf, and let them decide.” A GrubHub spokeswoman similarly said that while GrubHub is “focused on the opportunities within our current market,” that doesn’t mean “[an elderly meal service] isn’t something we may look into in the future.”

After all, data makes clear that senior services are in need assistance, too. And these programs, like Meals on Wheels, are more than ready to adapt to the digital platforms currently serving their future customers. “[Meals on Wheels] is a great public-private partnership,” says Hollander. “And there’s no reason why we can’t be excited that [services like GrubHub] may become partners as that same population ages.”

TIME Saving & Spending

Here’s Exactly How You Waste $1,700 Every Year

Money in jeans pocket
Image Source—Getty Images

If you do this, you might as well be lighting a pile of money on fire

Traffic congestion isn’t just a frustrating part of commuter life; it’s expensive. A new report finds that every household with a car-commuting member loses $1,700 a year in time and gas burned thanks to bumper-to-bumper traffic.

If you think that’s bad, it’s going to get worse: Researchers predict that annual cost will soar to $2,300 by 2030. Between now and then, the total tab adds up to $2.8 trillion.

The Centre for Economics and Business Research found that last year alone, wasted time and gas from sitting in traffic cost us $78 billion, and it warns that we’ll face greater congestion in the future because our population is growing and we’ll buy more cars, adding to the rush-hour standstill. (The study was commissioned by INRIX, a company that makes traffic-navigation software.)

Researchers say traffic jams also generate indirect costs. The group estimates that $45 billion worth of costs incurred by freight stuck in traffic gets passed along to consumers, and the carbon from the gas we burn has an annual cost of $300 million.

An expanding population and economy are the main culprits, says INRIX CEO and cofounder Bryan Mistele. More people and a higher GDP make car ownership more ubiquitous and more affordable.

And while you might think recent decreases in the price of gas might help, researchers say this actually hurts our traffic prospects in the long run: Cheaper gas means people are more willing to plunk down the money for a car and more likely to get behind the wheel, rather than considering alternatives like consolidating trips or carpooling. This, of course, means more vehicles clogging our roads at any given time.

According to the American Automobile Association, idling burns about a gallon of gas an hour even if you don’t go anywhere. So, what can the average commuter do?

Unfortunately, the answer for many right now is “not much.” Mistele suggests that in-car software or smartphone apps can help by giving drivers real-time congestion information and suggesting alternate routes. (That’s true, but sometimes even an alternate route will leave you staring at brake lights as the clock ticks.) Workarounds like alternative work hours are telecommuting can help, if you’re one of the lucky few who has that kind of job flexibility, but many of us don’t. Alternatives like public transportation, walking or biking will work for some, but will be inconvenient for anybody trying to haul a little league team or a warehouse club-sized package of paper towels across town.

Along with trying to consolidate trips and carpooling, the AAA recommends resisting the temptation to speed up as soon as there’s a bit of a break, then jamming on your brakes again a minute later. “It takes much more fuel to get a vehicle moving than it does to keep it moving,” the group advises, so try to keep a slow and steady pace if you can. Get the junk out of your trunk and remove unused third-row seating to lighten your load and improve your mileage.

TIME Saving & Spending

Young Adults Have Basically No Clue How Credit Cards Work

Close up of teenage girl texting on mobile in bedroom
Cultura/C. Ditty—Getty Images

Cause for concern?

Almost two-thirds of young adults today don’t have a credit card, but maybe that’s for the best, given their sweeping lack of know-how about this common financial tool.

Although Americans of all ages are less reliant on debt since the recession, millennials are far and away the most credit-averse age group. Bankrate finds that, among adults 30 years old and older, only about a third don’t have any credit cards at all. New research from Bankrate.com finds that 63% of millennials, defined as adults under the age of 30, don’t have any credit cards. Among those who do, 60% revolve balances from month to month, and 3% say they don’t bother to pay at all — more than any other age group.

There’s a good possibility that these young adults aren’t irresponsible, though, just misinformed. BMO Harris Bank recently conducted a survey that found almost four in 10 adults under the age of 35 think carrying a balance improves your credit score (it doesn’t). And roughly one out of four say they don’t check their credit score more than once every few years. Perhaps that’s because a third of them think checking your credit score hurts your credit (again, it doesn’t). BMO found that 25% of young adults don’t know even know what their credit score is.

And young adults also think it takes much less to get a good credit score. BMO finds that, overall, most Americans think a score of 660 or higher is a “good” score. In reality, that may have been true pre-recession, but it isn’t anymore. BMO says a good score is one that falls in the 680 to 720 range. Millennials, though, believe than anything above a 625 means you have good credit — a misconception that could cost them in the form of higher interest rates on credit cards and loans.

Millennials are also more likely than any other age group to think that store credit cards don’t count towards your score and that the credit card companies control their scores.

In reality, it’s up to the individual to maintain their credit score, and if millennials continue along not bothering to learn the essentials of credit and how to use it responsibly, they could end up paying for it in the form of lost borrowing opportunities or higher interest rates, Jeanine Skowronski, Bankrate’s credit card analyst, warns in a statement.

“The responsible use of credit cards is one of the easiest ways to build a strong credit score, which is essential for qualifying for insurance policies, auto and mortgage loans, and sometimes even a job,” she says.

MONEY Retirement

Live a Little: Your Kids Will Make Their Own Money

Some of us are saving too much. Really. Here's how to live a little and not shortchange your retirement.

The only thing worse than saving too little is saving too much. Most people who oversave do so at a stiff price in terms of the lifestyle they enjoy. Forgoing travel and nice meals to wind up with a modestly larger estate for heirs is a lousy trade.

Lawrence Kotlikoff, a Boston University economics professor, was among the first to begin raising this red flag. He recognizes that the vast majority of the population is undersaving. The U.S. has one of the lowest savings rates in the developed world, and fewer than one in five retirees has as much as $250,000. Those who diligently save in a 401(k) plan, on the other hand, are doing much better—and along with some others may be overdoing it.

He blames the retirement industry for spooking people into saving too much and shortchanging their daily lifestyle. From his blog:

“Economics has an enormous amount to offer the financial planning industry. But the industry has ignored economics, providing millions of Americans with what I and other economists view as truly awful advice.”

Around 1.5 million Americans will retire each year through 2025, according to the LIMRA Secure Retirement Institute. More than half of preretirees expect to live less comfortably than they had planned. Granted, a small portion of that is due to scrimping and saving—but if you suspect you are in that crowd, here are some ways you can avoid compromising your lifestyle unnecessarily:

Don’t plan for perfection. Most advisers and savings models rely on Monte Carlo simulations to estimate how long your money will last under various scenarios. You want to end up with a plan that gives you an 80% to 90% chance of not outliving your money. Reaching for, say, 97% certainty gets expensive in terms of the money you must save and may leave you cheaping out for no reason.

Writes Christine Fahlund, senior financial planner for T. Rowe Price: “If you are acknowledging that between 10% and 20% of the time, if you use this strategy, that you might run out in advance, now you are in a good place because you are not leaving too much money on the table.” You want to use that money to enjoy retirement, knowing you can always adjust along the way.

Lock in longevity insurance. An increasingly popular strategy is to use a portion of your savings to purchase a deferred fixed annuity, known as longevity insurance. If you spend $200,000 on this insurance at 65, you can begin collecting around $5,000 a month for the rest of your life at age 85. This provides absolute certainty for how long the rest of your savings must last. There are other considerations like emergency funds and potential healthcare costs. But if you have those bases covered, you can go broke throwing an 85th birthday party.

Stop saving at 60 Saving in small increments over three or four decades is smart because compounding works magic in the later years. But any money you put away past the age of 60 will have little time to grow if you retire at, say, 67. Putting away $5,000 a year for seven years, or a total of $35,000, would result in just $44,200 with a 6% average annual return. Is the $9,200 gain over that span worth the all the cruises you passed up?

Delay Social Security Every year you delay Social Security between ages 62 and 70 results in a certain benefit that is 8% higher. In today’s low rate environment, that’s the best deal around and basically means that if you are in good health and do not need the income you can spend more freely in your 60s knowing the added benefit will pay for some of it. Your kids will make their own money. Don’t play it so safe that you fail to enjoy your retirement years.

Related:
Our Retirement Savings Crisis—and the Easy Solution
Boomers Are Hoarding Cash in Their 401(k)s, Here’s a Better Solution
Why Gen X Feels Lousiest About the Recession and Retirement

 

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