How to Have a Fun Summer When Your Finances Fall Short

With layoffs, bank closures and inflation, financial tensions remain high for many Americans heading into the summer. In a fall 2022 survey conducted by The Harris Poll for the American Psychological Association, 83% of adults said inflation was a source of stress, and 56% said they and/or their family had to make different choices in the last month because they didn’t have enough money.

Making tough money choices is stressful, and sacrificing “wants” to afford the “needs” can be disappointing. But, if you’re questioning the financial impact of your summer plans or they have suddenly become out of reach, there are still ways to have fun, save money and put yourself in a better place for next year.

Pivot to a positive mindset

In the face of canceled summer plans, Rob Bertman, a family budgeting expert and certified financial planner in Missouri, suggests flipping your mindset from disappointment to opportunity. Use the moment to talk about money decisions with your partner or kids.

“I think it’s always good for kids to see that their parents are trying to learn and get better,” he says.

With children, Bertman says to avoid language like “we can’t afford it” or “it’s too expensive” because that can lead to a scarcity mindset. Instead, he suggests reframing the difficult choice as one that benefits the family in the long run.

The key to this attitude shift is not losing sight of your priorities. What you’re looking for, ultimately, is to make memories with people you love. While vacations seem primed for those frame-worthy moments, sometimes the things that matter most happen in your own backyard.

Reduce the cost of activities

Summer is prime time for free events, but you’ll have to put in a little work to find cheap events in your area. Even still, having things to look forward to on your calendar can be a big emotional lift.

A membership to a zoo, park, aquarium or museum could pay off in multiple visits all summer long. In addition, it’s a great way to get out of the house and enjoy the weather — or escape the heat, depending on where you live.

If a membership is too pricey, you might have a workaround in your wallet. For example, Bank of America credit card holders are eligible for the Museums on Us program, which provides free general admission to over 225 cultural centers across the country on the first full weekend of each month.

AAA members can get discounted tickets to concerts, movies, sporting events and amusement parks. And don’t forget your local library. Some offer free “experience passes” to gardens, museums, zoos and parks.

Once you pick an activity, cut costs by bringing your own food. You’ll save money on that last-minute drive-through meal or overpriced snack. When dining out, look for places where you can BYOB because alcoholic drinks can sometimes double the bill.

If you still want to travel, consider someplace close or split the cost with family or friends. “The easiest thing to do is treat your city or town like you’re a tourist,” Bertman says. Drop a pin or draw a circle around your town and find drivable destinations to explore, he suggests.

A vacation rental that was $3,000 might suddenly become affordable if you’re paying only $1,500. Grandparents might be happy to join in to make family memories — and you might even get a date night out of it.

Set yourself up for next summer

  • Automate summer savings. If having a full summer schedule is nonnegotiable, it might be time to prioritize this in your budget. Automatically transferring a fixed amount of money into a separate savings account each paycheck can help you build funds so you’ll have them set aside by next summer. Months with fewer holidays and birthdays are also prime for boosting additional savings, according to Bertman.
  • Be flexible. Life is unpredictable. Protect your plans by booking hotels with free cancellation policies or flights with refundable tickets to avoid fees or lost deposits. Travel insurance is another option, and some plans cover your reservations and medical expenses.
  • Check in on spending weekly. Bertman recommends conducting five-minute weekly spending reviews to see where your money is going. It will eventually become a habit — but set judgment and guilt aside. “Once families kind of get in the rhythm of doing that,” he says, “they figure out how to really cut out their spending without sacrificing their lifestyle.”

Amanda Barroso writes for NerdWallet.

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Care About Your Credit Score? Get Strategic With Card Limits

If you have credit cards in your wallet, you might track your balances to keep your budget in check, but knowing each card’s credit limit off the top of your head is another story. However, actively managing how much of your credit limits you are using — also known as your credit utilization ratio — can make a big impact on your credit score.

Your credit score is a mix of many factors, including your credit usage. If you want to build your credit score, focusing on using less of your credit limits is a powerful way to do it. People with excellent credit tend to have low credit utilization ratios.

According to credit expert John Ulzheimer, utilization is one of the more actionable ways to improve your credit: “To the extent you have the ability to pay down your credit card debt, then your ratios are going to go down. That’s just a fact.”

Even if you can’t reduce your balances, a few other strategies can help reduce credit utilization.

What is a credit limit and who determines it?

Your credit limit is the maximum amount you’ve been approved to spend by a creditor, based on factors like your payment history, income and credit score. A credit limit is not set in stone and is likely to change over the life of the account: Your card issuer can increase or decrease your limit without warning, and you can also ask for a credit limit increase (more on that later).

The way you use your credit limits can help your score

Make sure you know your credit limits. Try checking your latest bill or banking app to find the limit for each card. With your limits in mind, you can focus on keeping your balances low.

Ideally, you want to use no more than 30% of the credit limit on any card. The lower that credit utilization ratio, the less risky you seem as a potential borrower. People with the highest scores tend to use less than 10% of their limits. You can calculate your credit utilization ratio by dividing your balance by your credit limit. Multiply that number by 100 to get a percentage. Or you can use an online credit utilization calculator.

Keeping tabs on your credit usage is as simple as setting an alert once you’ve reached a certain spending threshold. Most cards will let you do that. Many personal finance websites and apps also have a dashboard that shows your utilization.

Other strategies can help you keep credit utilization low. “Pay an amount before you get your statement,” says Chi Chi Wu, an attorney at the National Consumer Law Center. “Because utilization is calculated from what the balance is at the end of the billing cycle, if you pay it beforehand you now actually reduce that utilization.”

Ulzheimer suggests two additional ways to keep your usage low: Start by trying to reduce your credit card balances if you’re carrying debt from month to month. Or you can ask to increase your credit limit, which not only offers you more flexibility to make bigger purchases but also helps lower your credit utilization ratio.

“If you can do both at the same time — lower balances and more credit limits — then again, you have lowered your ratio,” Ulzheimer says.

This works only if you can keep your balance low and resist any temptation to increase your spending. Also note that applying for a higher limit can temporarily ding your credit score.

The COVID connection

For a real-life example of how credit utilization and credit score are connected, look no further than the COVID-19 pandemic. Recent data from credit scoring company FICO shows that in 2020, many Americans took advantage of reduced spending and government stimulus checks to pay down their consumer debt. According to FICO, average credit card balances decreased by 10.9%, and the average FICO score rose 8 points between April 2020 and April 2021.

Doing something simple — like using extra cash to pay down existing credit card balances or making several payments throughout the billing cycle — can improve your credit, even during trying financial times.

This article was written by NerdWallet and was originally published by The Associated Press. 

Amanda Barroso writes for NerdWallet. Email:

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