Personal Finance

The must-have gift of the season may be a ‘dupe’

Published

4 months ago

November 22, 2024

Business Finance News

Caiaimage/Paul Bradbury | Caiaimage | Getty Images

‘Tis the season for giving… dupes?

Buying a dupe — short for duplicates — rose to the top of this year’s holiday wish-lists. A dupe gift is a gift that is a cheaper alternative to a more expensive, branded item. They were largely kept under the radar until recently because a “fake” was dubbed inferior to the real thing, but a lot has changed.

In some cases these brand imitators are now even preferred to their pricier counterparts.

This year, 79% of consumers said they would buy a dupe as a gift for their loved ones for the holidays, according to a survey of more than 1,000 shoppers by CouponCabin.

More than half — 51% — of those that the coupon site polled said dupes are better than the original.

Even when consumers can get the real thing, nearly 33% of adults intentionally purchased a dupe of a premium product at some point, a separate report by Morning Consult also found. The business intelligence company polled more than 2,000 adults in early October.

When is a dupe an appropriate gift?

Before you buy a dupe, think about who you’re shopping for, experts say.

For instance, some family members or friends might especially appreciate a dupe for what it is, said Ellyn Briggs, a brands analyst at Morning Consult.

“It’s kind of a badge of honor for young people to get a dupe,” she said.

On the other hand, you risk disappointing someone if they have been asking for a specific product for a while, said Melanie Lowe, CouponCabin’s savings expert.

If that is the case, consider the cost of the name-brand item and assess if it is within budget. The key is to know when to splurge or save, Lowe said.

“If you’re talking about a product that you’ll use daily… invest in the original,” Lowe said. “That purchase is usually worth it.”

Alternatively, “if it seems appropriate in the situation — if it is a more light-hearted gift — you can definitely go the dupe route,” she said.

‘It’s a dupe for a reason’

While some shoppers take pride in buying dupes, roughly 86% of shoppers have been disappointed by their purchase of a dupe, CouponCabin found.

“It’s a dupe for a reason,” said Lauren Beitelspacher, professor of marketing at Babson College. “We don’t know where it’s made, who is making it or the quality.”

Visa's View on the Holiday Shopping Season

“It’s not that all dupes are bad. But sometimes we are paying a premium because there is a quality difference — and we, as consumers, have to be more conscious of that,” Beitelspacher said.

If you want to shop for dupes, read and watch product reviews online to help determine the dupe’s quality — this is where social media can come in handy.

A majority, or 62%, of U.S. adults who use TikTok say they use the app for reviews or recommendations, according to a new study by the Pew Research Center. Others tap Instagram and Facebook for product research.

Shopping secondhand this season

Consumers should make the same value considerations when buying secondhand, which has also become more popular, even for gifting.

Three in four shoppers said that giving secondhand gifts has become more accepted over the past year — notching a 7% increase from the year before, according to the 2024 OfferUp recommerce report. OfferUp, an online marketplace for buying and selling new and used items, polled 1,500 adults in July.

The majority, or 83%, of shoppers are also open to receiving secondhand gifts this holiday season, the report found.

Shoppers have increasingly turned to resale for a number of reasons, including value, sustainability and as a means to secure hard-to-find luxury items. Because secondhand shopping is considered eco-friendly, it’s also become more socially acceptable. OfferUp’s report credited Generation Z for driving a shift in mindset.

“The stigma around secondhand gifting is rapidly diminishing,” said Todd Dunlap, OfferUp’s CEO.

However, the same buyer-beware mentality applies, cautioned Babson’s Beitelspacher, especially if you are ordering secondhand goods online. “You might not get what you want,” she said.

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Personal Finance

Amid tariff sell-off, avoid ‘dangerous’ investment instincts, experts say

Published

24 minutes ago

April 4, 2025

Business Finance News

Jamie Grill | Getty Images

As U.S. markets continue to suffer steep declines in the wake of the Trump administration’s new tariff policies, you may be wondering what the next best move is when it comes to your retirement portfolio and other investments.

Behavioral finance experts warn now is the worst time to make any drastic moves.

“It is dangerous for you — unless you can read what is going to happen next in the political world, in the economic world — to make a decision,” said Meir Statman, a professor of finance at Santa Clara University.

“It is more likely to be driven by emotion and, in this case, emotion that is going to act against you rather than for you,” said Statman, who is author of the book, “A Wealth of Well-Being: A Holistic Approach to Behavioral Finance.”

That may sound easier said than done when headlines show stocks are sliding into bear market territory while J.P. Morgan is raising the chances of a recession this year to 60% from 40%.

“When the market drops, we have sort of a herd instinct,” said Bradley Klontz, a psychologist, certified financial planner and managing principal of YMW Advisors in Boulder, Colorado. Klontz is also a member of the CNBC FA Council.

That survival instinct to run towards safety and away from danger dates back to humans’ hunter gatherer days, Klontz said. Back then, following those cues was necessary for survival.

But when it comes to investing, those impulses can backfire, he said.

“It’s an internal panic, and we’re just sort of wired to sell at the absolute worst times,” Klontz said.

‘Never trust your instincts when it comes to investing’

When conditions are stressful, our frame of reference narrows to today, tomorrow and what’s going to happen, Klontz said.

It may be tempting to come up with a story for why taking action now makes sense, Klontz said.

“Never trust your instincts when it comes to investing,” said Klontz, particularly when you’re excited or scared.

Why investors should hold despite market sell-off

Meanwhile, many investors are likely in a fight or flight response mode now, said Danielle Labotka, behavioral scientist at Morningstar.

“The problem with that, in acting right away, is that we’re going to be relying on what we call fast thinking,” Labotka said.

Instead, investors would be wise to slow down, she said.

Just as grief requires moving through emotional stages in order to eventually feel good, it’s impossible to jump to a good investing decision, Labotka said.

Good investment decisions take time, she said.

What should be guiding your decisions now

Many investors have experienced market drops before, whether it be during the Covid pandemic, the financial crisis of 2008 or the dot-com bust.

Even though we’ve experienced volatility before, it feels different every time, Labotka said.

That can make it difficult to heed to the advice to stay the course, she said.

Investors would be wise to ask themselves whether their reasons for investing and the goals they’re trying to achieve have changed, experts say.

“Even though the markets have changed, why you’re invested, your values and your goals probably haven’t,” Labotka said. “These are the things that should be guiding your investments.”

While there is the notion that life well-being is based on financial well-being, it helps to take a broader view, Statman said.

At any moment, no one has everything perfect when it comes to their finances, family and health. In life, as in an investment portfolio, all stocks don’t necessarily go up, and it’s helpful to learn to live with the good and the bad, he said.

“Things are never perfect for anyone,” Statman said.

Personal Finance

20 items and goods most exposed to price shocks

Published

56 minutes ago

April 4, 2025

Business Finance News

Employees at a clothing factory in Vo Cuong, Bac Ninh province, in Vietnam.

SeongJoon Cho/Bloomberg via Getty Images

The Trump administration’s plan to slap steep tariffs on goods from dozens of countries is expected to spike prices for consumers. Some items, like leather goods, will see a bigger jump than others.

The overall impact on households will vary based on their purchasing habits. But most families — especially lower earners — are likely to feel the pain to some degree, economists said.

According to an analysis by the Budget Lab at Yale University, the average household will lose $3,800 of purchasing power per year as a result of all President Donald Trump‘s tariff policies — and retaliatory trade actions by other nations — announced as of Wednesday.

That’s a “meaningful amount,” said Ernie Tedeschi, the lab’s director of economics and former chief economist at the White House Council of Economic Advisers during the Biden administration.

The analysis doesn’t include the 34% retaliatory tariff China announced Friday on all U.S. exports, set to take effect April 10. The U.S. exported nearly $144 billion worth of goods to China in 2024, the third-largest market for U.S. goods behind Canada and Mexico, according to the Census Bureau.

Clothing prices poised to spike

The garment industry is among the most susceptible to tariff-related price shocks.

Prices for clothing and shoes, gloves and handbags, and wool and silk products will all increase by between 10% and 20% due to the tariffs Trump has so far imposed, according to the Yale Budget Lab analysis. Tedeschi noted that some of these price increases could take 5 years or more to unfold.

Srdjanpav | E+ | Getty Images

The bulk of apparel and shoes sold in the U.S. is manufactured in China, Vietnam, Sri Lanka and Bangladesh, said Denise Green, an associate professor at Cornell University and director of the Cornell Fashion + Textile Collection.

Under the “reciprocal tariffs” Trump announced Wednesday, Chinese imports will face a 34% duty. Goods from Vietnam, Sri Lanka and Bangladesh face tariffs of 46%, 44% and 37%, respectively.

Taking into account the pre-existing tariffs on China totaling 20%, Beijing now faces an effective tariff rate of at least 54%.

“The tariffs are disastrous for the apparel industry worldwide, but especially for smaller countries with highly specialized garment manufacturing,” Green said.

A lot of clothing production has moved overseas over the last 50 years, Tedeschi said, but it’s “very unlikely” clothing and textile manufacturing will return to the U.S. from Asia in the wake of the new tariffs.

“People will still import clothing to a large extent, and they’ll have to eat the price increase,” he said.

Car prices are another pain point

Various Mercedes-Benz vehicles assembled in the “Factory 56” production hall.

Picture Alliance | Picture Alliance | Getty Images

The duties announced Wednesday are on top of other tariffs Trump has imposed since his second inauguration, including duties on automobiles and car parts; copper, steel and aluminum; and certain imports from Canada and Mexico.

The cost of motor vehicles and car parts could swell by over 8% according to the Yale Budget Lab analysis.

Bank of America estimated that new vehicle prices could increase as much as $10,000 if automakers pass the full impact of tariffs on to consumers.

“Rising car prices are already a major pain point for the vast majority of Americans who live in an area where they need a car to get to work, school, their kids’ activities, and medical appointments,” said Erin Witte, director of consumer protection for the Consumer Federation of America.

“These tariffs will make it much worse, and will significantly reduce Americans’ choices about what car they want to buy,” she said.

Tariffs on specific commodities like aluminum and steel affect consumers indirectly, since the materials are used to manufacture a swath of consumer goods.

White House spokesman Kush Desai pushed back on analyses that prices will spike because of Trump’s tariff policy.

“Chicken Little ‘expert’ predictions didn’t quite pan out during President Trump’s first term, and they’re not going to pan out during his second term when President Trump again restores American Greatness from Main Street to Wall Street,” Desai said in an e-mailed statement.

Trump’s second-term tariffs are orders of magnitude larger than his first term, however.

The first Trump administration put tariffs on about $380 billion worth of goods in 2018 and 2019, according to the Tax Foundation. The tariffs so far imposed in Trump’s second term affect more than $2.5 trillion of U.S. imports, it said.

There’s also evidence that the first-term tariffs raised prices for some consumers.

Retail prices for the typical washing machine and clothing dryer rose by about 12% each — about $86 and $92 per unit, respectively — due to 2018 tariffs on imports of washing machines, according to a study by economists at the Federal Reserve Board and University of Chicago. The increased cost to consumers totaled $1.5 billion a year, the study found.

Tariffs are expected to raise the U.S. inflation rate

Economists also expect the overall U.S. inflation rate to jump due to tariffs.

American businesses that import goods from abroad will be the ones on the hook for paying the cost of tariffs, and economists anticipate that companies will pass at least some of those costs on to consumers.

The tariffs are disastrous for the apparel industry worldwide, but especially for smaller countries with highly specialized garment manufacturing.

Denise Green

director of the Cornell Fashion + Textile Collection

An environment of rising prices for foreign goods may give U.S. businesses cover to somewhat raise their prices, too.

As a result, the consumer price index could jump to 4.5% later in 2025, Capital Economics estimated Thursday. That’s up from 2.8% in February, and roughly double the Federal Reserve’s long-term inflation target.

Personal Finance

What to know before trying to ‘buy the dip’ amid tariff sell-off

Published

1 hour ago

April 4, 2025

Business Finance News

Anchiy | E+ | Getty Images

As the stock market continues to fall, some investors are eager to “buy the dip,” or purchase assets at temporarily lower prices. Financial advisors, however, urge clients to stick with long-term investing plans amid the latest volatility.

U.S. stocks plunged on Thursday after President Donald Trump issued sweeping tariffs on more than 180 countries and territories. The sell-off continued Friday after China unveiled plans to impose a 34% retaliatory tariff on all goods imported from the U.S.

As of Friday afternoon, the Dow Jones Industrial Average was down more than 1,700 points following a 1,679.39 drop on Thursday. Meanwhile, the S&P 500 was off 4.8% after losing 4.84% the previous day. The tech-heavy Nasdaq Composite slid by 4.9% after plummeting 5.97% on Thursday.

If you’re looking for buying opportunities while assets are down, here are some things to consider, according to financial advisors.

Timing the market is ‘impossible’

When asset values fall, there’s often chatter in online communities like Reddit about whether to “buy the dip.” Typically, investors aim to buy at a discount and expect an eventual recovery, which could lead to future gains.

While buying cheaper investments isn’t a bad idea, the strategy can be tricky to execute since, of course, no one can predict stock market moves, experts say.

“We never recommend timing the market, mostly because it is impossible to do without simply getting lucky,” said certified financial planner Eric Roberge, CEO of Beyond Your Hammock in Boston.

Instead, you should “stick to a thoughtful, rules-based investment strategy designed to get you through to your long-term goals,” he said.

Keep a ‘disciplined approach’

When buying assets during a market downturn, you need a “disciplined approach,” according to CFP Jay Spector, co-chief executive officer of EverVest Financial in Scottsdale, Arizona.

For example, some investors linger in cash while waiting for rock-bottom prices. But no one can predict the bottom of the market, experts say.

Waiting on the sidelines can be costly because the best returns can follow the biggest dips, according to research from Bank of America.

Rather than trying to time the bottom, you should consider “dollar-cost averaging,” which systematically invests your money at set intervals, Spector said. The strategy can capture lower prices while reducing risk, he said.