More than three years since the COVID-19 pandemic shuttered stages around the world, concerts are up in full swing for 2023. A large part of the bump stems from two leading tours this year—Taylor Swift’s Eras and Beyoncé’s Renaissance Tours. Along with the explosion of cultural phenomenon Barbenheimer, the rise in concert attendance, including new-age concert experiences that encompass boarding flights, booking hotel stays, and prepping and styling the perfect tour-themed outfits and accessories, contributed about $8.5 billion to the U.S. economy.
The spending has provided such a massive boost that experts have penned 2023 as the year of “tourflation,” with impacts from “Swiftonomics” and the “Beyoncé Bump.” Certain industries are also taking advantage of the economic impact—U.S. newspaper chain and mass media company Gannett, which owns over 200 daily papers across the country, recently posted two new roles dedicated to reporting exclusively on the artists in its job listings.
The concerts’ influence exemplifies a new era, or renaissance, dedicated to the experience economy, especially coming out of a pandemic when the entire globe was encouraged to stay home. Whereas consumers were spending on travel following the availability and accessibility of COVID-19 vaccines, now, they’re dedicated to localized experiences, explains Christopher J. Day, wealth advisor and founder of Days Global Advisors, a firm dedicated to financial literacy.
“Consumer demand has been pent up coming out of the COVID-19 pandemic. Even after we had the vaccines, there was a push for travel,” he says. “Now that it has settled down and become normalized, people are thinking, what’s the next thing? Domestic experiences. That’s where you’re seeing more people wanting to get back out, wanting to socialize.”
2024 is likely to be no different. With more artists hitting the stage in the new year (Grammy-award winning pop artist Olivia Rodrigo just announced an upcoming tour for her new album Guts), along with Swift embarking on an extended tour with dates in the latter half of next year, experience spending is here to stay.
Yet, as the need for emergency savings rises given higher inflation figures and daily costs, along with the return of student loan repayments next month, budgeting for a show and the experience surrounding it can seem impossible for some.
So, how should investors prepare without sacrificing their savings?
Well, it’s all about advocating for balance, says Mindy Yu, director of investing for Betterment at Work. For example, before investors splurge on front-row tickets or spend hundreds on a costume for the night, ensure they have an adequate emergency fund in place. “Financial advisors can play a crucial role in helping clients navigate these decisions based on their unique financial circumstances and goals, by creating a customized financial plan and providing guidance,” adds Yu.
Instead of asking if they can afford attending a concert, create a budget that outlines income, expenses, and savings goals for the short- and long-term, including upcoming student loan repayments, and 401(k) funds and individual retirement accounts (IRAs).
If their employer offers a retirement plan with a matching contribution, ensure investors are taking advantage of the benefit. Even saving up to match is better than foregoing savings, notes Day. “If the concert is something they feel a lot of importance about, maybe just fund the 401(k) account until the match,” he says.
Once it’s ensured that investors can manage all necessary expenses, including living expenses, paying down debt and stowing some money away for retirement —look at the amount of money left and consider those as monthly discretionary funds, continues Yu.
And, if concerts are a big priority and a regular expense for clients, consider creating a separate savings fund specifically for shows and entertainment, or advising clients to watch for discounts and credit card promotions on shows and events, she adds.
“It’s possible to enjoy concerts and other fun experiences while maintaining a healthy financial situation, Yu points. “The key is to budget carefully and strike a balance between enjoying the present and securing your financial future.”
SEE ALSO:
- Now Is the Time for Emergency Savings
- Student Loans Preventing College Grads From Major Life Milestones
- Emergency Savings and Retirement Planning Tightly Linked
Amanda Umpierrez is the Managing Editor of 401(k) Specialist magazine. She is a financial services reporter with over six years of experience and a passion for telling stories and reporting news. Amanda received her degree in journalism and government and politics at St. John’s University. She is originally from Queens, New York, but now resides in Denver, Colorado with her partner. In her free time, Amanda enjoys running, cooking, and watching the latest drama show.
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