The "Vibecession" Might Be Over. Here's What it Means for Your Financial Resolutions.
Jan 26, 2024
Last year around this time, we posted an article about how 80% of resolutions fail by February. Whether you stayed the course or wavered in 2023, 2024 is a new year, offering its own unique opportunities and speedbumps.
The trickiest thing about setting financial resolutions in 2024 revolves around the growth of consumer sentiment. Sounds counterintuitive, right? Let us explain.
How a “vibespansion” could spell trouble for your finances
As inflation cools and prices lower, people have adopted a more positive outlook, ending what economist Kyla Scanlon dubbed as the “vibecession” and opening a period of what she now calls a period of “vibespansion.”
While feeling good about the future is a good thing, it’s still just as important to be intentional and vigilant about your finances. According to Psychology Today, optimism can cloud your judgement, causing you to spend more than you should, open yourself up to risk, and stray from your goals. This concept is supported by the fact that credit card debt is at an all-time high. As consumer sentiment picks up, so does the willingness to take on debt, it seems.
Five tips for setting vibespansion-proof resolutions
- Be bold about saving, not spending: The good news for resolution-setters in 2024 is that the economic data is stacked in your favor. With job growth increasing and your grocery bill looking lighter, now is the time to be bold about saving that extra money, not spending it.
- Review the basics: If you haven’t already, read our primer on setting solid financial resolutions, which includes developing SMART goals, decluttering your finances, and exercising a few choice digital tools.
- Dig into your credit score: Your credit score is the most powerful financial tool you’ll ever have. Consider making 2024 the year you get it under control to make it work for you. Reading our Credit 101 article is a great place to start.
- Automate your income. Save without even trying via tools like direct deposit, automatic savings contributions, and interest-bearing savings accounts or CDs. Additionally, look into accounts like Perks Checking that give you access to deals and discounts to help you save on shopping, travel, recreation and more.
- Live below your means. No, it doesn’t mean living like a pauper. It simply means spending less than what you earn. An adage followed by the likes of Warren Buffet, Ed Sheeran, and Dave Grohl, this mindset is not only good for your bank account but also for your mental health, and it’s a great way to avoid slowly building up crushing debt. Think like these celebs: How did you live five, 10, even 20 years ago, when you had less earning power? Did you cook at home more? Were you less swayed by fashion or tech trends? Were you any less happy as a result? Try bringing back some of those habits and see what you save.
Build your wealth in 2024
The coming year is shaping up to be a prime opportunity to upshift for your financial wellbeing. With less pressure and worry than previous years, you’ll be free to drive real changes in your mindset and behaviors without feeling like you’re sacrificing. Use this opportunity to make concrete plans, grow your savings, and solidify your habits to put your financial health on autopilot.