Is the market going to crash?
Everyone jostled by the news the housing market could crash has every reason to be worried. And why is that so? Because when the last time the housing market sored like this — it sparked a great recession that left many in financial ruins.
The Real Estate Market Crash is Coming Sooner Than You Think
Always — fueled by a rapid increase in home prices, a rising housing demand, and home flippers — the market then crashes.
Real estate is experiencing record low-interest rates that make housing affordable. However, that has skyrocketed the house prices. It’s crystal clear demand is outpacing supply; what next? Could the mobile and modular homes be the fix?
Mobile homes for sale (tyrone woods) might just be the potential fix to the American housing shortage going by the fact they take a shorter time to build than site-built homes.
Recently, Google reported that the search “When is the housing market going to crash?” had spiked 2,450% in the past month. Many are anticipating history to repeat itself, just like the 2008 housing market crash.
Speculations are rampant about how when the real estate markets could crash — but first, what can we learn from the 2008 housing market crash? Here are some interesting facts about the events preceding the crash back then.
What Caused the Housing Market Crash 2008?
The housing market crash 15 years ago ignited a worldwide recession. The sole reason for the crash and financial crisis were down to predatory private mortgage lending and unregulated markets. Here’s what preceded the great recession in 2008.
Housing Prices and Foreclosures
A similar event like the one happening now ruled prior to the market crash in 2008. Housing prices shoot through the roof, with speculative buyers flooding the market, leading to a demand exceeding supply.
In the early-to-mid 2000s, mortgage lenders revised their lending standards of a desirable borrower which opened a window to borrowers with poor credit to get access to loans and secure home purchase. The easing of lending standards created an opening for many to access mortgages.
The rise of Mortgage-Backed Securities (MBS) was hugely misunderstood by many investors.
The high demand in the housing market propelled an increase in risky mortgage lending practices. On the other hand, the Federal Reserve Bank raised the interest rate to 5.6 percent by June 2006.
What About Adjustable Rate Mortgages?
While those with conventional type of loan weren’t affected, the majority with Adjustable-Rate Mortgage (ARM) were the casualties. Plunged into unforeseeable debt, many defaulted, leading to a huge rise in foreclosures in the housing market.
In 2008, the number of foreclosures spiked to a record high of 81%, according to a CNN report. A total of 861,664 families lost their homes to foreclosure that year. This led to more inventory availability, and subsequently, a crash followed suit.
Banks’ Risky Behavior
The rise of Mortgage-Backed Securities (MBS) led to financial institutions extending their mortgage lending. Many banks seized the opportunity for a lucrative long-term benefit. All was well until the bubble burst. Leaving huge collateral of subprime mortgages.
On the other hand, banks stopped lending to each other in fear of being trapped with subprime mortgages. Even after the Federal reserve cutting down the interest rates, it wasn’t enough to stop the bleeding economy (the panic).
The Stock Market Crash
The stock market crash led to many losing their wealth caused by the increasing number of closures and housing busts. In fact, the major financial markets lost more than 30% of their value by September 2008, when the Dow Jones Industrial Average fell 777.68 points, which surprised 684.81 loss on Sept. 17, 2001, the first trading after the September 11 attack.
According to a report by NCBI, between 2007-2011 one fourth of American families lost at least 75 percent of their wealth, and more than half of all families lost at least 25 percent of their wealth.
Are You Following Current Events?
Now, back to our topic discussion, can you see the similarity in the current events? Well, it’s crystal clear the housing markets are in a bubble. In this article, we’ll uncover why we think the real estate market crash coming soon.
Real Estate Market Crash Coming Soon
Analysts have made their point; the federal government has had its say, different perspectives have been put forward in a bid to break down the events of the current housing market.
Statistics and History
Statistics and history all have been gathered around and pinned to where it’s due. The only question remains, will the housing market crash this year?
Whether you love statistics or not, we’ll try to make it as lenient as possible, a step-by-step guide on how and why the market could crash sooner rather than later. Market crash doesn’t happen in a split of a second; it builds over time.
Watch Economic Factors
Economic factors at play, the forces of demand and supply, are often the case of a free market like real estate. Frank Nothaft, a chief economist at CoreLogic, says, “We’ve got an acute shortage of supply on the market for sale at the same time that record-low mortgage rates are driving the appetite to buy by millennials and Gen-Xers.”
New York City Prices Among Others
For instance, Bloomberg reported New York City home prices are rising fast. New Yorkers who may still be working from home a year into the pandemic are fanning out across the boroughs in search of another housing that is spacious and cheaper housing.
Whenever one side outplays the other, a disequilibrium is created, an imbalance in the market that needs a solution to revert to the initial position. For example, basic economics dictates that interest rates and housing prices have an inverse relationship. As such, when the interest is low, the house price goes up. Why is that?
It’s simple when the rate is low; housing becomes cheaper or affordable to acquire; this, in turn, creates a high demand for housing since it’s affordable at the time.
Investors or homeowners on the other hand will try to take advantage of the rising demand by increasing the prices. As prices rise it’ll cut off some people who will suddenly be unable to purchase the home at the asking price. Now, demand is being brought down by price growth, thus justifying the inverse relationship with the interest rates.
The Housing Bubbles Burst
Up until now, the most common term you’ve probably heard is a housing bubble? Do you know what it means? What causes it? And if it burst, then what could be the factors or forces that are the last straw that breaks the camel’s back?
Day by day, it’s harder to deny the fact the US housing market is overheating.
According to the Wall Street Journal, some regions are experiencing low inventory, which is a worrying sign as far as the housing market crash is concerned. Across the country, the housing market is 3.8 million single-family homes short of what is needed to meet the country’s demand, according to a new analysis by mortgage-finance company Freddie Mac.
Home price surge also suggests an asset bubble.
The COVID-19 hasn’t slowed home prices at all, Instead, they’ve skyrocketed. In September 2020, they were a record $226,800, according to the Case-Shiller Home Price Index.
According to the National Association of Realtors, the sales rate reached 5.86 million homes in July, and by October, it had blossomed to 6.86 million, beating the pre-pandemic peak. Many people are taking advantage of the low rates to buy either residential homes or income-based apartments, which seem affordable.
The COVID-19, on the other hand, has created a slow economic activity resulting in a high unemployment rate.
According to the Labor Department, the US lost 140,000 jobs in December 2020 alone. A rising number of job losses means few people will afford to buy houses, while those with mortgages will likely default and increase the number of foreclosures.
On the other hand, the job losses have forced many people to seek Plan B, going for mobile homes for rent that is exceptionally cheaper and affordable during this time.
What is a Housing Bubble?
A housing bubble happens when the market price of residential real estate sharply rises. Usually, this happens when the demand for houses exceeds the supply in the market. The sudden rise of house demand triggers speculators to enter the market to profit from future expectations.
The presence of speculators in the market further pushed the demand higher.
So, yes, speculators entered the market, and in response, the home prices shot up, creating a bubble stretch in the housing market to grow even further. Now it reaches a time when the home prices are high up and no longer affordable to buyers. The unsustainability caused by the rising prices leads to homes being overvalued. In other words, price inflation.
When the prices become unsustainable and buyers pull out, demand falls.
The prices become unsustainable — but interestingly, the supply increases. Simple economics at play here; now that the demand has fallen, what happens next? Prices come down crashing and the bubble bursts.
When questioned about the possibility of a bubble:
Ali Wolf, chief economist at housing research firm Zonda says, “Homebuyers today are purchasing for many healthy reasons: Low-interest rates, more flexibility to work from home and increased saving are all rational reasons for buying a house. The frenzy fueled by these factors, combined with fear of missing out, has the potential to create a bubble though.”
What Causes a Housing Bubble?
Real estate is a free market; the law of demand and supply applies unconditionally. When the demand for housing increases, subsequently, home prices go up. Usually, the supply of homes takes time to match the rising population of young Millenials who are seeking first-time home buying. It always plays a catch-up game.
Building a house takes time, causing a deficit in supply and thus demand exceeding it. Either way, prices will eventually increase the moment demand outpaces supply. To sum it up, the asset bubble is down to a combination of factors. One such factor — a healthy economy, where disposable income grows, and people feel secure in their jobs and confident about searching for a house, increasing the demand.
The mortgage rates also play a huge role in the asset bubble.
Low mortgage rates drive up demand; why so? The mortgage has become more affordable and buying a house is a lot easier attracting many borrowers to run for cheap loans.
The rising number of subprime borrowers also causes the demand to further rise in the real market. The market is currently experiencing a record low mortgage, driving housing demand up. Record low mortgage with 30 years fixed rate fell to 3.20 percent, according to Bankrate.
The other factor is the speculators who are always in waiting mode to take advantage of an opportunity whenever it presents itself. Further rise in demand leads to overvaluation of houses which asserts the asset bubble growth.
Forces that Burst the Bubble
When pushes come to shove, and the prices aren’t reflective of anything close to fundamentals, the bubble burst. At this point, the demand decreases while supply increases resulting in a sharp fall in home prices.
No one has to pay for high home prices anymore; on the other hand, investors are at a huge loss, mortgage lenders reeling on the risk of defaulters. How does that happen?
Firstly, the interest rises to put some homeownership out of reach, while at the same time, in the case of Adjustable-Rate Mortgage, makes the home a person owns unaffordable, leading to defaulting and foreclosure.
Secondly, a downturn or slow economic activity often leads to less disposable income, fewer jobs, and job loss. Such a situation causes a decline in demand for housing since a person can not afford to buy a home.
Lastly, when demand is exhausted, an equilibrium is restored, slowing down the rapid rise of the home price growth. When house price appreciation stagnates, those who depend on it to afford their home may lose their houses, bringing more supply to the market.
Higher Interest Rates
As stated earlier, interest rate and house prices tend to have an inverse relationship such that when the interest is low, price appreciation occurs, and the reverse is also true. Interest rates play a huge role in marketing crashing. And if it’s going to happen soon, it’ll surely be a contributing factor by far.
Rates rise will make mortgages very expensive.
It’ll discourage borrowers from taking loans. On the other hand, home buildings will be affected too, costs will rise, and an immediate effect will be the supply of housing in the market falling.
However, a steady rise in interest rates will not cause much damage in the housing market, unlike a rapid rise. In 2006 before the housing market crash, many people were tied to interest-only and adjustable-rate mortgages that are initially cheap within the first few years, and then a reset that increases the monthly mortgage payment.
Unlike conventional loans, adjustable-rate mortgage rises along with the feds fund rate.
Between 2004 and 2006, the Federal Reserve increased the rates rapidly. For instance, The top rate was 1.0% in June 2004 and doubled to 2.25% by December. It doubled again to 4.25% by December 2005. Six months later, the rate was 5.25%.
Rising Number of House Flippers
A flipped home is basically bought, renovated, and sold in less than a year. Usually, the rise of home flippers further increases the demand for housing in the real estate market, resulting in a further increase in house prices. Surging prices are reflective of an asset bubble that could potentially burst.
Home flipping played a huge role in factors contributing to the 2008 recession.
Speculators would buy homes, make moderate improvement, and sold it to fast-rising house prices. In 2006, flips comprised 11.4% of home sales.
According to Attom Data Solutions, in the third quarter of 2020, 5.1% of all home sales were bought for quick resale. That’s down from 6.7% of home sales in the second quarter of 2020. It’s also lower than the post-recession high of 7.2% in first-quarter 2019.
The decline in flipping is due to the reduced inventory of housing stock. However, Attom Data Solutions reports that the pandemic’s effect on flipping is contradictory and difficult to forecast.
The Alarming Increase in Unregulated Mortgage Brokers
In the events leading to the 2008 financial crisis, mortgage lenders fueled the asset bubble by issuing out loans to high-risk borrowers. Many of the lenders opted to borrow against lines of credit, a totally different strategy than what banks and mortgage lending normally work by tapping into deposits.
Non-Bank lenders are a warning sign of a crash.
The increase in non-bank lenders is alarming and a clear warning sign of what may come sooner rather than later in real estate. In 2019, they originated 54.5% of all loans. That’s up from 53.6% in 2018. Six of the 10 largest mortgage lenders are not banks. Three years ago, five of the top 10 were unregulated.
The most worrying part about unregulated mortgage brokers is that they don’t have the same government oversight as banks. Making them vulnerable to collapse in case of anything going south in real estate.
A section of the Washington Post read “Although observers say non-bank lenders are probably not engaged in the sort of risky lending that dragged down their predecessors, the business model still makes them vulnerable to a housing market downturn.”
Inverted Yield Curve
Prior to the recession of 2008,2000 and 1991, 1981, the yield curve inverted. According to a definition by Investopedia, an inverted yield curve represents a situation in which long-term debt instruments have lower yields than short-term debt instruments of the same credit quality. When the yield curve inverts, short-term interest rates become higher than long-term rates.
The inverted yield curve is the rarest and considered to be a predictor of economic recession.
Usually, they draw attention from all parts of the financial world. A normal yield curve slopes upwards reflecting the fact that short-term interest rate is usually lower than long-term rates.
Affordable Housing Crisis
The affordable housing crisis is caused by the imbalance in the market forces of supply and demand. A market boom in real estate will result in home prices skyrocketing. The scarcity of affordable housing across the country is always a sign that the market is in a bubble.
The Bottom Line
Is the market going to crash?
The market could crash if the combination of the above factors comes to pass. Already many are in play, and as the home prices sores, it’s evident that the US housing market is overheating.
The pandemic has had a mixed reaction on the real estate performance.
While many people expected COVID-19 to crash real estate, there was a sudden surge in homes for sale. More homes for sale listings were done last year, with people rushing to buy homes in the suburbs. The rising homes for sale listings sparked the speculators to enter the market, further pushing the demand up.
Move to Prevent Foreclosures
Elsewhere, millions went behind their mortgage payment plan; however, the Consumer Financial Protection Bureau (CFPB) mortgage servicing changes to prevent a wave of COVID-19 foreclosures.
Consumer Financial Protection Bureau (CFPB) Acting Director Dave Uejio says, “The nation has endured more than a year of a deadly pandemic and a punishing economic crisis. We must not lose sight of the dangers so many consumers still face.”
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5 Ways To Better Reach Your Audience
Attempting to reach your audience is difficult, as the internet is full of information, and consumers are flooded with the constant noise of advertising, social media, and email. It can be intimidating for a company to get its message heard over the noise. However, with a bit of care and planning, you can successfully reach your target demographic and interest them in your product.
Maybe you’re a new business with a great product and want to know how to drive traffic to your site. Or perhaps you’re established but have something fresh and exciting to offer, and you need to know how to spotlight it. Maybe you’re interested in learning how to reach a whole new demographic and are unsure how to do that.
To reach out to a new audience online, keep your existing customers interested, or drive conversions, you need to plan your content strategy and SEO carefully. It’s not enough just to launch a product website, announce it on social media, and wait to see what happens. Instead, you’ve got to find a way to amplify your voice.
Initiating a Strategy
Content encompasses everything you use to communicate information to the world: social media, graphics, written communication, and your website itself are included in this category. Your content strategy and SEO should tackle the questions: Who am I trying to reach, What do I need to tell them, and How am I going to do that? MarketMuse’s extensive content strategy guide notes that an effective content strategy outlines business goals and aligns with SEO.
Depending on your company’s scale, you may want to hire someone to help you develop a strategy, manage a team of writers, designers, and developers, and keep an eye on metrics to ensure your messaging is on target and getting the results you need. However, be aware that it can take six months or more to gain traction and that there are some questions you’ll want to ask when hiring an SEO expert.
Here are five steps you can take today to ensure that you successfully communicate about your brand to reach your intended audience.
1. Identify who you want to reach
Regardless of company scale or team size, an effective content strategy begins with research and planning. This step can be time-consuming but is so important. It’s the foundation for building your overall content strategy.
The first rule of content is: know your audience. Who are you trying to talk to and why? Get as specific as you can in this step. For example, identify an age range, gender, if applicable, socioeconomic status, and interests. It is sometimes helpful to create an avatar or character to represent your target market and talk specifically to that person. If you nail your demographic, your message will carry.
Once you know who you’re targeting, make sure what you’re saying to them makes sense. For example, promoting your retirement savings 101 blog cluster and planning tools will not be effective if your language and approach only appeal to a 60-year-old.
2. Sell a lifestyle, not a product
This is one of the trickiest elements of content marketing strategy for any company to master. But, first, it’s important to remember that content isn’t about directly promoting a product or about making a sale. At least, not overtly.
Content strategy is about building relationships and offering something your audience values and needs: information. If your information is solid and you get it in front of the right people, you will build trust and drive conversions over time. It’s helpful to think about strategies employed by large brands – especially what they don’t do.
Athletic shoe companies don’t bore you with all the technical specs of their product; they show you an image of athletes running fast or thriving in their sport. They let you imagine yourself succeeding in the same way. Similarly, the best tech companies don’t talk about RAM or GPUs in their ads. Instead, they show you how sleek you look with the latest gadget. They show you how much that gadget will simplify your daily tasks.
If you work too hard to tell your audience about the details of your product (which may be exciting and important) in your content marketing, you’re going to bore them and lose them.
3. Make sure your content is on point
Great content isn’t necessarily about volume. If what you’re offering is sound, you don’t have to drone on forever. For example, we’re all annoyed by recipe blogs that make you scroll through five pages of irrelevant nonsense to get to what’s of value to you: the recipe.
If you want to avoid being the next recipe blog cliche, ensure your writing and graphics are clean and clearly communicate the data or insights you want to highlight. Plan social media posts to be playful and fun and get to the point right away. Attention spans are minimal when people are scrolling.
Your written content (emails, blogs, website copy) should be clean, clearly written, and well structured. Organize your site to include a search feature, ensure it is responsive to various devices and has multiple easy-to-find navigation options. The key is to eliminate the need for your audience to work to find what they want.
4. Use your digital tools thoughtfully
To ensure your content rises above all that noise online, you absolutely need to include SEO in your content strategy. This is where brands can get a little intimidated, confused, or overzealous, however.
SEO, or Search Engine Optimization, is not as esoteric as you might think, but it takes time, research, and effort to implement correctly. SEO can include keywords that help ensure your page shows up in search results, your website’s design and security, and your site’s responsiveness to different screen sizes.
So, what does that mean? Well, the answer to that may vary, but a few essential points will put you on the right track. First, you want to ensure you’re not basing your content strategy on SEO considerations and keywords.
The result will be that your content feels shoehorned around obvious keywords (because it is) and won’t offer much value to readers. Maybe you’ll appear in search results, but that won’t do anything for you once people click on your page and decide there’s nothing valuable. At that point, you’ve lost trust. You may also lose those initial clicks as search algorithms constantly evolve.
The key is ensuring you are offering quality information to your target audience. Make sure that information is clear and that your website is navigable, and then find ways to work in keywords naturally. Also, don’t be afraid to use social media to toot your horn.
5. Post often and repurpose content
In addition to optimizing your website and content, you’ll want to plan a solid social media strategy and use appropriate posting techniques to boost your web traffic and conversions. The good news is that not everything you post has to reinvent the wheel. For example, it is ok to repurpose the same link with slightly different messaging.
It’s also important to remember to post on different platforms for different reasons. If you’re trying to talk to a Gen Z demographic, you’re probably not going to be successful if your entire social media presence is based on Facebook. You might look at Instagram or TikTok instead.
As with blog and website content, you’re not going to be effective if you simply post ad copy on social media. Instead, find innovative and fun ways to draw your audience in. Make them laugh. Tell them how to solve a problem. Teach them a new skill.
And don’t forget to update your blog copy, too. For example, you might have a blog that predicts the best crypto investments in March. You can create an updated version in April without starting from scratch.
If you take the time to do your homework, develop a solid plan, allow your strategy appropriate time to work, and measure results (and use those to revise your plan, and so on), you have a solid foundation for your content marketing presence. Make sure your content is tailored to the right audience, easy to read, easy to navigate, and actionable, and you can’t go wrong.
Image Credit: Karolina Grabowska; Pexels; Thanks!
Connected Medical Devices are Revolutionizing Health Care
The Internet of Things (IoT) may be about to transform almost every aspect of people’s lives. Health care is one industry already seeing significant adoption of IoT technology. Connected medical devices are helping doctors and nurses remotely monitor patients, access health data, and conduct follow-ups online. As a result, IoT in health care could revolutionize the industry over the next few years.
How Does the Health Care Industry Use Connected Devices?
The Internet of Medical Things (IoMT) includes various devices used inside and outside health care facilities. In most cases, these items provide a few of the same benefits — including streamlined treatment, reduced risk of error, and greater availability of critical data, like information on patient vitals.
Smart Patient Monitoring Devices
One popular application of IoT in health care is the smart patient monitor. This device continuously collects health care information from a patient, including data on heart rate, blood pressure, temperature, and blood oxygen levels.
These devices help make patient health data more accessible to doctors and nurses inside facilities. A patient’s medical team can quickly and remotely check their vitals from a hospital workstation or a secure device anywhere in the world. The smart patient monitor can also alert staff if someone’s vitals exceed safe levels.
Smart health care wearables and remote patient monitors allow doctors to continue tracking patient vitals without requiring them to remain in the facility. In addition, people who have been recently discharged from the hospital may bring smart patient monitors with them, allowing them to send important health information to doctors without having to return to the hospital for a follow-up. They can also access this information and get a valuable window into their post-release health.
The patient and their doctor can discuss any concerning health information over the internet using a telemedicine video call solution. The doctor can also immediately recall the patient to the hospital if the monitor suggests their health is in danger.
Various IoMT patient monitoring devices exist, ranging from large machines built for hospital settings to lightweight health-tracking wearables people can take with them wherever they go.
Specific use-cases for IoMT monitoring technology include general-purpose smart patient monitors, motion sensors that track the progression of Parkinson’s disease symptoms, and mood sensors that can help doctors manage a patient’s mental health.
Smart Infusion Pumps and Medication Delivery Devices
Correctly dosing and delivering medicine is essential for patient treatment. However, medication errors remain a common challenge in many medical environments. These mistakes can cause serious injuries or adverse reactions that can lead to death.
The IoMT can help prevent medication errors by streamlining the dosing process and delivering IV medicine.
Smart infusion pumps are medication delivery devices that use innovative technology, barcode readers, and drug information libraries to reduce risk when administering IV medicine. The health care worker will designate an area of use — like the adult ICU or NICU — which will automatically configure the pump based on needs. The clinician will then select the medicine they need to administer from an internet drug library, select a concentration and configure the pump’s dose.
Information from the drug library will help prevent some of the most common medication errors — like dosing mistakes and combinations that may lead to health problems.
Some pumps may require that the clinician scans the drug using a barcode on its packaging rather than choosing one from a list.
Most pump systems incorporate a few safeguards that will help reduce the frequency of medication errors. For example, the pump may include the height and weight information of the patient receiving a drug, helping ensure they receive the appropriate dose.
The pump system may also include information on average drug concentrations and dosing units. As a result, it can double-check with health care workers to ensure an unusual dosage is correct, potentially preventing medication errors.
Smart Device Scanners
Manufacturers will often use laser marking to create a unique device identifier (UDI) codes on the surface of connected medical devices like orthopedic implants and medical instruments. They provide a wealth of information about the marked device — including the specific version or model number.
Under current regulations, the manufacturer must provide this code in plain language and a machine-readable format.
Smart medical scanners can read the second version of the UDI instantly, draw on relevant information from cloud-based databases and update records. This makes them a powerful tool for conducting inventory, determining an instrument’s specific model or lot number, and verifying the plain-language portion of a UDI.
These devices are connected to the internet, so they can also be used to update cloud-based records as they scan automatically. For example, hospitals that maintain an online database of critical medical instruments can use a smart scanner to update it with new products.
In practice, these scanners can also make it much easier for health care organizations to comply with traceability requirements. For example, clinicians can use information from the UDI to quickly verify the model number, expiration date, and recall status of a medical instrument or device before it is used.
Clinicians that locate faulty or expired equipment can quickly remove it, ensuring it won’t be used for a procedure.
Smart Pills, Capsules and Medications
New smart pills and capsules can help patients take their medications regularly. They are outfitted with special sensors that activate when they hit the acid in a patient’s stomach. They then communicate with a wearable medical device — like a patch on someone’s chest — signaling that the pill has been taken.
The wearable device that receives the signal can automatically generate a log or report showing the medication was taken successfully.
The connected medical device can also track other information — like the patient’s activity and rest times.
The first smart pill approved by the FDA was Abilify Mycite, which contains aripiprazole, an antipsychotic used to treat conditions like schizophrenia and bipolar disorder. Patients with these conditions may struggle to remember if they’ve taken their medicine, but missing a dose can cause adverse reactions — including nausea, lightheadedness, anxiety, and a return of symptoms associated with the mental health condition the aripiprazole is meant to treat.
The smart system can help patients track their medication adherence and review patterns when they take their medicine.
Smart pills are not widely used yet, but they may soon help patients and health care providers improve medication adherence and track home-usage.
Future smart pills may also provide additional functionality. For example, those containing onboard sensors could help doctors track a patient’s core temperature, detect intestinal bleeding, or keep tabs on gut health. Many of these pills already exist in an experimental capacity and may become commercially viable by the end of the decade.
The Future of Connected Medical Devices and IoT in Health Care
Connected medical devices can make providing effective health treatment much easier. The right one can streamline care, reduce error risk, and simplify record-keeping.
IoT in health care is growing fast over the next few years. According to Fortune Business Insights, the market may be worth as much as $187.6 billion by 2028, up from just $41 billion in 2020. As a result, new applications of smart medical technology may become widely available.
For example, it may also become standard for health care facilities to adopt connected robots, like those used in Italian hospitals during the early days of the COVID-19 pandemic.
Currently used IoMT devices — from smart monitors to smart pills — will likely become much more common over the next few years as the market expands and health care facilities look to adopt devices that make daily work easier.
Image Credit: Provided by the Author; National Cancer Institute; Unsplash; Thank you!
How to Stop Inflation from Deflating Your Savings
No, you aren’t imagining things. Everything costs more than it did before, and these higher prices make it hard to balance the budget while saving and thinking about retirement. But you can stop inflation from deflating your savings!
In April, the Bureau of Labor released the latest data from the Consumer Price Index (CPI), revealing inflation’s steady creep upward hasn’t stopped yet. The rate of U.S. inflation climbed to a whopping 8.5% in March, marking this spike as the most significant increase in the cost of living in 4 decades.
You aren’t alone if you’re struggling to handle prices at their 40-year high. Nearly half of Americans (45%) polled by Gallup last year admitted inflation caused financial hardship at a time when the CPI was just 6.8%. Moreover, of those that reported facing difficulties, 10% revealed their challenges impacted their standard of living.
While the Federal Reserve claims inflation’s bubble will pop soon, experts anticipate the CPI won’t fall below 4% by the year’s end. That means you can expect another year of high inflation bumping up prices.
Is your budget ready? If not, don’t panic. Instead, keep reading to understand more about inflation and what you can do to protect your savings.
Inflation: An Overview
Inflation is not a product of the pandemic, although it may initially seem that way. On the contrary, between lockdowns and labor shortages — and now the Russia-Ukraine crisis — the past 3 years have kept inflation well-fed.
These special circumstances allowed inflation to grow to dizzying heights, but it’s been around a lot longer than COVID.
Have you ever heard your dad tell you a story about buying a bag of candy for a nickel, only for your grandfather to chime in to say he bought the same thing for a penny? They aren’t just yearning for the good old days of their youth. That’s inflation at work.
Inflation is an economic principle describing how the prices of goods and services generally increase over time. Another way to think of it is how your money — or what’s called your purchasing power — decreases in value as time goes on.
Usually, inflation only increases by around 2% each year. And if you’re lucky, your employer matches this increase with an equivalent raise. This zero-sum game means a lot of people may not notice inflation. Sure, things cost more, but you also earn more, so it all evens out.
The problem with today’s record-breaking inflation rate is that prices are climbing far too fast for wages to keep up. While employers have been handing out raises, a survey shows they averaged 3.4% in 2021, less than half of today’s current inflation rate.
With inflation and wages out of balance, you may notice how your dollar doesn’t stretch as far as it used to before the pandemic. Each expense takes up more of your very finite budget as a result.
Americans Are Living Paycheck to Paycheck
Now that everything costs more, many Americans are feeling the financial crunch. According to CNBC, nearly two-thirds of Americans (64%) live paycheck to paycheck today. This isn’t necessarily new. In fact, survey after survey has revealed people have been living this way for nearly a decade.
If you’re living paycheck to paycheck, most, if not all, of your monthly income goes towards making ends meet. With your income tied up with bills, you may have practically no cash for anything else.
Your Paycheck May Not Go As Far — But Don’t Deflate Your Savings
It’s hard to keep up with your savings goals when you live like this. You might even hit pause on savings altogether. And without contributing to savings, Americans increasingly turn to credit cards and short-term personal loans for help in an emergency.
CNBC reports that 56% of Americans could not handle an unexpected $1,000 expense with savings. Most of those without savings would charge credit cards or ask a loved one for some help. But others would go into debt and borrow money online via short-term personal loans to cover unexpected expenses.
While credit cards and short-term personal loans function as emergency backups in unexpected cash crunches, they’re meant as temporary stopgaps for singular expenses. Moreover, borrowing money won’t solve the issue that high inflation is an ongoing problem that will long outlast most cash advances and personal loan terms.
More still, debt can add to your money troubles. If you’re already living paycheck to paycheck, you may not have the cash available to repay your personal loan on time. Late fines and extra interest are soon to follow.
Updating Your Budget with Inflation in Mind
Americans point to high costs preventing them from saving as much as they want, regardless of whether they rely on credit cards or short-term personal loans as crutches.
Unfortunately, there’s no telling just how long high inflation will hang around. Still, one thing is for sure: a higher-than-normal inflation rate will affect prices for the foreseeable future.
Higher prices are the new normal, so it’s time to tweak your budget, updating it for another expensive year. Let’s dive into how you can do that.
1. Make a List of Priorities
When things are tight, you need a plan of action to understand your next move. So sit down and write out your list of priorities. These expenses are the absolute essentials you need to pay each month to keep a roof over your head and food on the table.
Besides housing costs and groceries, this list may include insurance payments, utilities, basic household items, and toiletries. In addition, the minimum payments for personal loans, cash advances, and lines of credit also belong on this list. These minimum payments will help you avoid late fines, extra interest, and credit damage.
This list shows the bare minimum for what you need each month. It serves as a good reminder of what you need to pay first before moving on to other things.
2. Cut Discretionary Expenses
As judge, jury, and executioner of expenses, you should be looking to slash non-essential spending until you have more wiggle room in your budget. Then, the unnecessary expenses (i.e., those you don’t need to lead a safe or comfortable life) should be on the chopping block.
Which expenses didn’t make it on your list of priorities? It can be daunting to say goodbye to the fun things in life, but it’s easier to let go knowing it won’t be forever. You can reintroduce the non-essentials when you start to feel less pressure.
To help you get started, here are some discretionary expenses you can cut:
- Streaming services: If you have multiple streaming subscriptions, pare them down to the one you use most often.
- Subscription boxes: While the average subscription box doesn’t cost a lot, it may be too much if you’re living paycheck to paycheck. Put them on pause until you have more wiggle room in your budget.
- Gym memberships: The average gym membership costs about $600 a year. You can pocket that change by switching to a free at-home workout.
- Takeout: According to The Fool, the average American spends $2,375 on takeout a year. If you eat out multiple times a week, you stand to save a lot by eating at home.
- Alcohol: Happy hours after work and wine with dinner add up. Going dry can help you free up more cash for bills.
Finding it hard to say no when you’re out and about? Apply the 30-day rule. In other words, wait for 30 days before you commit to the purchase. A month is long enough to take the wind out of your sails, revealing the splurge for what it is: a waste of money.
3. Automate Savings
Even at this time, savings are an essential part of your budget. It can help you weather unexpected emergencies, reducing how often you tap into credit cards and short-term personal loans.
Admittedly, saving through high inflation is challenging, so you might want to ignore the usual advice to save 3 to 6 months. But, that’s a goal for another day.
For now, save as much as you can to get started, even if it’s just $10 a month at first. Financial advisor David Ramsey suggests lowering your goal to $1,000 when you’re first starting out.
4. Tweak Your Phone and Internet Package
Having a phone and access to the Internet is as close to essentials as possible nowadays. You might need them for work, or it may be the only way you can contact the outside world. So cutting these expenses for the sake of saving money just doesn’t make sense.
If you’re on an unlimited plan, consider downsizing to a cheaper plan with strict data and talk limits. Be careful not to exceed these limits to ensure you aren’t penalized. You stand to save even more each month if you can stomach a prepaid contract.
5. Update Your Insurance
Like your phone and Internet packages, insurance is another essential with some wiggle room. But first, you’ll want to do some research. Go online to compare other insurance companies to see what they offer. Then, when talking to your current provider, you can leverage this info to know if they’re willing to match the competition.
Another thing you can leverage is your loyalty. If you’ve been with the company for a long time, bring this history up while talking to your provider. They might be willing to cut you a better deal knowing you’re thinking about jumping ship.
You may also get a better deal if you’re willing to bundle your life, home, and auto insurance under one company.
6. Eat Better for Less
Putting food on the table has never been more expensive. But, unfortunately, you can’t precisely cut groceries from your budget!
Meat and dairy have been some of the hardest-hit items in the grocery stores, with bacon, eggs, and beef taking most of the brunt. Now that bacon is 26% more expensive per pound than last year, you might think twice about including it on your breakfast plate.
Plant-based eating promises some financial savings at the grocery store, especially if you stay away from costly prepared meat replacements. Instead, focus on tried-and-true cheap ingredients like lentils and rice.
Following a meal plan is also another great way to keep your spending in check at the supermarket. Make a list of meals you want to eat every week, adjusting your plan for weekly flyers and coupons.
7. Use Less Energy
Your utility bills are taking a bigger bite of your budget, like electricity, water, and gas cost more. According to the Guardian, utility prices in the U.S. rose by 33% last year.
Reducing energy consumption across these utilities can help you control runaway expenses.
One of the biggest things you can do to save is set your thermostat according to the Department of Energy’s recommendations. These tips can help you save as much as 10% of your annual heating and cooling costs.
Summer: If you have an air conditioner running, set it to 78°F when you’re at home. Try increasing the temperature as high as you feel comfortable when you’re out.
Winter: During the cooler months, try to keep your thermostat to 68°F while you’re at home, reducing it even lower when you’re at work or in bed.
8. Reduce Your Fuelling Costs
Between inflation and the Russia-Ukraine crisis squeezing the American fuel supply, drivers can expect to spend more at the pumps. If you can’t reduce how often you’re behind the wheel, you should download an app like GasBuddy to find the lowest gas prices in your area.
More often than not, this ends up being Costco, but they don’t get a membership just to qualify for their gas. So you probably won’t save more at their pumps than what it costs to become an annual member.
Another way to keep your driving costs low is by using gas station loyalty cards so that you can redeem points as often as possible. You can also consider carpooling with local friends and colleagues to share the burden of driving.
9. Learn How to Negotiate
The art of negotiation is a hard-earned skill that can do wonders for your budget. Depending on your strategy and your creditor’s policies, you can push out due dates to take the pressure off your budget and reduce what you owe.
If you aren’t sure how to persuade big companies, check out this script for guidance. When it comes to medical expenses specifically, ask if they offer a financial plan that offsets your costs. In many cases, healthcare businesses are willing to give you a discount if you offer to pay the reduced amount in full immediately.
10. Investigate Financial Assistance
Let’s face it — juggling all your bills as inflation nudges them higher, and higher is hard. Sometimes, not even your best attempts at negotiating bills and saving money at the grocery store will be enough to help you balance your budget.
Reach out to a free credit counseling organization for advice. They can provide more significant insights into how to shrink your budget. But more importantly, they can direct you towards government assistance programs that help you offset the burden of your living expenses.
The Takeaway for :
Although inflation is beyond your control, there are ways you can get back in the financial driver’s seat. As prices continue to rise, your budget is your most crucial resource throughout it all. You can refer to this spending plan to understand your priorities and focus on areas of your spending that need work.
You can reduce your monthly spending and save more, whether it’s unnecessary splurges or excessive fuel spending. Keep these tips in mind for the rest of the year.
But more importantly, know that you aren’t alone in facing these prices. There are resources you can fall back on for more guidance if you can’t balance the budget, no matter how hard you try.
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