The new year can be an opportunity to form some good habits—maybe adding a daily walk or cutting out desserts. If you’re in this mindset, add organizing your financial life to your list of resolutions.
For older adults, gaining a sense of control over finances is particularly important, says Susan Devaney, a professional who specializes in helping older adults move from their longtime homes and resettle elsewhere. Scammers regularly target seniors with bogus claims of unpaid bills, so having an organized system to doublecheck your finances can help to protect you, she says. It’s also useful to have documentation if you’ve forgotten whether you paid a bill and need to review your records.
“It freaks all of us out when we get
these crazy calls from scammers,”
says Devaney, founder of The
Mavins Group, a move-management
and real estate sales company in
Westfield, N.J. “If you have some
sort of system, you can reassure
yourself.”
And Lowe’s is taking steps to improve pricing and promotional tools in order to recoup lost margins in the new year. Moreover, lower interest rates, stability in the housing sector and advertising efficiencies from the continued shift to digital marketing should give the stock
a boost.
All three stocks are rated buy at UBS, with Hasbro upgraded on Nov. 25. Amazon has a $2,100 price target, Hasbro has a $117 price target and Lowe’s price target is $140.
Home improvement retailer Lowe’s is also a “top global idea” at RBC Capital Markets, where it’s rated outperform with a $134 price target.
“While we have long believed that part of Lowe’s relative underperformance versus Home Depot relates to their respective store bases, as Lowe’s stores tend to be located further out from major metro areas, we have also underestimated how difficult Lowe’s had made it for Pros customers to do business with the company, and improvements on this front should enable it to gain incremental market share,” analyst Scot Ciccarelli wrote in a note.
Young consumers are increasingly concerned about climate change which makes environmental sustainability a top issue for the retail sector.
“We believe brands that promote sustainability will gain wallet share of younger consumers and become more relevant,” wrote Cowen analysts in their “Future of Retail” report. “In our view, there is a strong momentum toward eliminating waste among retailers.”
Cyber Monday mobile transactions in 2019 totaled $3.1 billion, according to Adobe Analytics data. Total Cyber Monday online sales were $9.4 billion, a record.
“The smartphone continues to radically alter the end-to-end customer experience as customers increasingly rely on smartphones to research, transact and engage with brands,” Cowen analysts say.
The rise of smartphone shopping is due to social media platforms and the influencers, brand ambassadors, and communities that have popped up on them. Cowen data shows that more than 63% of millennials ages 18 to 34 spend at least four hours per day on their mobile phones.
“We also believe that the channel has major implications for both in-store traffic and conversion as consumers use devices to inform purchases before or during shopping trips, including the use of smart labels, virtual reality and augmented reality,” Cowen said.
Even as shoppers use mobile devices and other e-commerce platforms to make a purchase, customers are increasingly opting to make the last-mile trek for their
items themselves.
“We expect more shoppers to adopt and appreciate curbside pickup, which we view as an ideal manifestation of combining physical and digital retail,” Cowen said.
Cowen data shows that 21% of the U.S. population has tried curbside pickup or buy-online-pickup-in-store for their groceries.
Walmart Inc. (WMT) and Target Corp. (TGT) are the leaders in curbside pickup, Cowen says. Both are able to leverage their large store fleets to offer the service.
“Given that the same-day options rely on our store assets, team and inventory they are much more profitable than traditional e-commerce fulfillment,” said Target’s Chief Executive Brian Cornell on the third-quarter earnings call.
E-commerce on various devices and convenient fulfillment methods are also erasing the shopping calendar.
“Black Friday will change dramatically in 2020,” said Graham Cooke, chief executive of Qubit, a personalization software provider. “There’s no need to wake up at the crack of dawn just to fight over sale items when shoppers can find great deals from their couch.”
Moody’s analysts think global trade policy disputes, will continue to be a risk factor in 2020, as well as a weight on consumer confidence. President Trump’s U.S. - China trade war has disrupted global manufacturing and retailing supply lines and the import tariffs have raised some prices.
“Although we do not expect a recession in 2020, recession risks are high amid a backdrop of trade policy uncertainty, [and] an unpredictable political and geopolitical environment,” Moody’s says.
“Increased trade friction could trigger spikes of volatility in financial markets and further disrupt trade flows. Many companies have so far been able to lessen the effect of tariffs through a combination of cost reductions, buildup of pre-tariff inventory and price increases within the industry supply chain. But these offsets may not last if these
tensions persist.”
Moody’s forecasts slight operating income growth to a 3% or 4% increase in 2020 for the retails sector, though analysts don’t expect “much improvement” in operating margins as retailers use promotions to increase market share.
Dollar stores like Dollar General Inc. (DG), off-price retailers like TJX Cos. (TJX), and supermarkets like Kroger Co. (KR) are expected to outperform. Department stores like Macy’s Inc. (M) and J.C. Penney Co. Inc. (JCP), and drug stores like Walgreens Boots Alliance Inc. (WBA) are forecast to underperform.
The Amplify Online Retail ETF (IBUY) is up 30% for the past year, the SPDR S&P Retail ETF (XRT) has gained 13.4% for the period, and the Dow Jones Industrial Average (.DJI), and S&P 500 index (.SPX) are up 24.2% and 30.3% respectively.
Secondhand retailers are also in a position to benefit from concern about sustainability. Cowen thinks RealReal Inc. (REAL) and ThredUp, which forecasts that the secondhand market will be valued at $51 billion by 2023, have an advantage.
Nearly half of the total sustainable merchandise is for women, 25% for children, and 24% for men, according to the StyleSage Sustainability Report.
Kiplinger
Your 2020 financial
planning calendar
Online lifts holiday shopping sales
Seema Shah of Creditntell.com says the holiday shopping season got a lift from
e-commerce sales, but overall results could have been more robust.
© 2020 Bloomberg L.P.
Sustainability will continue to be top of mind for young consumers
Retail gets increasingly mobile
Recession fears and international trade disputes will continue to impact the
retail sector
Kiplinger
5 secrets to a happy and healthy retirement
Budgeting apps and other digital
money-tracking tools may be handy,
but you can also use an old-fashioned, paper-based filing system, Devaney notes. “Some people just want to be able to see everything on paper,” she says. “When they put it in a digital document, they feel like it can get lost in there and they can’t retrieve it.”
January is a great time for sales at office supply stores, so select a few items, such as folders and folder tabs, to begin reorganizing. Pick up a simple desk organizer for your supplies, from pens to paper clips, so you don’t get distracted trying to find them as you work. Devaney prefers accordion folders, so you can organize bills either by month or by subject. Then use tabs or stickers to color code your bills. But don’t get carried away; if you make your organizing system too complicated, you won’t use it.
She suggests sticking to 12 to 13 months’ worth of files organized by date, or 10 to 12 subjects, such as utility bills, mortgage payments or health care costs. You might also want to include all your insurance policies and tax-deductible contribution acknowledgements, so you don’t overlook them at tax time.
One way to streamline your bills is to mark the date that you paid it at the top, and add the check number, if needed, before you file it. Or use a colored sticker you’ve designated for paid bills. That way, if a scammer calls you, or if you’re not sure you’ve paid a bill or receive a late notice in error, you can easily go back and check, Devaney says.
Make sure that you—and your spouse or adult children—know how to locate all your accounts and their passwords, says Lori Atwood, a Washington, D.C., financial planner. Keeping a paper copy of all passwords in a secure but accessible place can work, but you also could consider online password managers that keep them safely stored digitally.
The new year also is a perfect time to review your budget, Atwood says. Write down your income, expenses, retirement contributions and account balances. Then simplify some of your finances. Consider using just one credit card, even if you have a spouse, to cut down on fees, she says. If you have recurring charges such as Netflix or magazine subscriptions, put them on a backup credit card, so if your primary card gets hacked, you don’t have to update all your accounts with a new card.
Set up reminders throughout the year, perhaps on your Google or Outlook calendar, to stay on top of tax due dates and other financial deadlines. And once you’re organized, snap photos or scan your most important documents or bills, so you have a digital backup if needed.
It’s not always easy to get motivated to organize your finances, a task on par with cleaning out a closet or going to the dentist. But it might take just a few hours, Atwood says. “Just get it done,” she says. “It’s all about feeling financially empowered.”
Ready, set, file