Money Management

When you make an offer to buy a house, it’s always a good idea to make it contingent on an inspection. Find out why I didn’t do that with my recent purchase. [[{“value”:”

When you’re buying a house, it’s very important to remember that you’re making a major financial commitment. You don’t want to accidentally buy a property with a ton of problems and drain your bank account by having to make repairs as soon as you move in.

To avoid this fate, you’ll almost always want to make any offer to purchase a home contingent on a satisfactory inspection. While mortgage lenders don’t usually require this as a mandate, home buyers should because an inspection can turn up issues that are expensive to fix. Making an offer contingent upon, or conditioned upon, a satisfactory inspection gives buyers the chance to either negotiate for money off the price or walk away without losing a deposit if something is very wrong.

Although it’s almost never a good idea to waive inspection, I did exactly that when I purchased my home recently — and I don’t regret it. Here’s why.

An inspection wasn’t needed in this situation

When I purchased my new home recently, there were a few simple reasons why I did not make my offer conditioned upon a home inspection.

I was planning to do a gut remodel of the house anyway. The home had been in foreclosure for a very long time before it was purchased by some investors I was trying to buy it from. There were tons of known problems with the home, from a bad roof to moldy cabinets in the kitchen. I didn’t need an inspector to tell me it needed major fixes, since it was obvious those fixes had to be made.My contractors had been through the house. The sellers allowed us to bring professionals through to give us an estimate on remodeling costs, so I already knew how much money I was likely to be out to address the issues.I wanted my offer to be as strong as possible. The house had been listed for rent, not for sale, and I wanted to convince the investors to sell it to me despite that.

Ultimately, I was able to get my offer accepted, I am almost done with my remodel, and I have no regrets.

Should you waive an inspection?

If you do not make your offer to buy a home contingent on an inspection, you are putting yourself in a very high-risk position. A lot could be wrong with the house that isn’t visible to the naked eye (unlike in my case, where you could see the damaged shingles and dirty cabinets). And if you don’t have the chance to have a professional go through before you commit to buying, you could face some nasty surprises after your mortgage closes and you move in.

It’s true an offer without an inspection contingency is usually considered a stronger one because there’s less chance of the deal falling through or the price being renegotiated. But this is a risk you simply cannot take on unless you’re planning for a complete remodel job anyway. The average price of a new roof is $10,000, and that’s just one of many expenses you may have to take on.

Outside of very specific circumstances, like my situation, you should not take the risk that you’ll find out after the fact that major portions of the house need to be redone. Get that inspection and follow this cardinal rule, unless there’s a very good reason not to.

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We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.The Motley Fool has a disclosure policy.

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Want to open a CD in 2024? Learn why CDs are a good deal this year — but they still might not be right for your savings. [[{“value”:”

Certificates of deposit (CDs) are showing strong levels of “interest” (ha!) among bank customers in 2024. If you’ve been thinking about opening a CD but not sure if you should do it, now is a good time to crunch some numbers and weigh your options.

Opening a CD could be a good move this year, but only if you’re aware of the possible risks and drawbacks. CDs are not always the best place for people to keep their savings. But if the Fed goes ahead with interest rate cuts in 2024, opening a CD before interest rates fall could be a smart financial move.

Let’s look at the biggest reason why you might want to open a CD in 2024 — and one big reason to put your money in another place.

Why open a CD in 2024: Lock down a high APY

Today, the best CDs are offering rates of 5.00% APY and higher. These are some of the highest rates we’ve seen on CDs for several years. And interest rates might be about to go down.

That’s because, as of March 7, 2024, Federal Reserve Chair Jerome Powell said that the Fed is “not far” from being ready to cut interest rates, as long as inflation continues to move in the right direction. No one knows for sure when the Fed might cut interest rates. But if the Fed cuts rates in, for example, June, that means right now (before June) could be your best chance to lock in a higher APY on a CD.

CDs pay you a fixed rate of interest for the full length of the term. Savings account APYs are not fixed. The best high-yield savings accounts are currently paying 5.30% APY or more. But if the Fed cuts interest rates by 0.25% in June 2024, those yields will likely drop to 5.05% APY (or less) almost immediately.

But if you’re locked in on a 1-year CD with 5.35% APY (the best 12-month CD rate as of this writing), your CD will keep paying that same rate of interest for a full year, and all that time, you’ll be earning a higher yield than you could get in even the best savings account.

The best reason to open a CD in 2024: You believe that the Fed is going to cut interest rates, and you want to keep earning today’s high APYs for as long as you can.

Why not open a CD in 2024: One big drawback

It’s true that CDs often (but not always) pay higher APYs than savings accounts. But there’s one big risk and downside to a CD: they charge penalties for early withdrawal. That’s right — CDs require you to lock up your money for the length of the term. For this reason, CDs are really not the right choice for many people’s savings.

Why you shouldn’t use a CD for emergency savings

Your emergency savings fund — if you have one — needs to be liquid (in cash) and immediately accessible. If you lose your job tomorrow or have a medical emergency or a car repair or otherwise need cash, you’re going to want to be able to get that cash out of the bank ASAP.

CDs don’t allow this level of flexibility. Most CDs will charge you an early withdrawal penalty if you pull your money out before the term is up. This penalty can often gobble up most of the interest you earned, which defeats the purpose of opening a CD in the first place; you might as well keep your money in a zero-interest checking account.

Why you shouldn’t open a CD for short-term savings

Some people want to use CDs for specific short-term financial goals, like a down payment on a house, a new car, a vacation, or a wedding. But the inflexibility of CDs can make them a bad choice for these purposes, too.

What if your car breaks down and you need to shop for a new vehicle six months sooner than you expected? What if interest rates drop, making it easier to get an affordable mortgage, but your down payment money is tied up in a 2-year CD?

Sometimes people’s financial plans change faster than a CD will allow. Are you sure you want to take that risk? (You might also consider a no-penalty CD for better flexibility — but a lower APY.)

Why you shouldn’t open a CD for long-term investments

Unless you are currently retired and you need CDs to generate steady income for you to live on in retirement, you should probably not have CDs in your IRA. There are better ways to invest your money, especially if you’re still several years (or decades) away from retirement age.

For example, the best 5-year CDs are currently paying 4.00%-4.30% APY. If your investment time horizon is five years or longer, you can likely earn a higher return with a diversified portfolio of stocks and bonds.

Bottom line

I’m not a huge fan of CDs, and I’m not opening any CDs in 2024. But CDs can be the right choice for some people. If you want a fixed rate of interest on your savings, and you believe that interest rates are about to go down so far that a high-yield savings account will be a less attractive option, you might want to open a CD in 2024.

These savings accounts are FDIC insured and could earn you 11x your bank

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We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.The Motley Fool has a disclosure policy.

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You don’t need to be part of a couple or family to join Costco. Read on to see why. [[{“value”:”

When we think about the typical Costco shopper, let’s face it — we probably imagine a somewhat frazzled suburban parent loading up a cart with assorted snacks, milk, and string cheese in the hopes of not having to return for a refill for at least a good couple of days.

It can be harder for singles to benefit from a Costco membership. That’s because a lot of the savings to be had by joining is reaped in the form of discounts on bulk grocery purchases. If you’re single, you may not be able to buy as much food in bulk.

But joining Costco could still make financial sense for singles. If that’s your status, here are five reasons to consider a membership.

1. You might manage to buy some food in bulk

If you’re single, you may not need the bulk version of every perishable item you tend to consume. But if you’re someone who cooks often, you may benefit from some of Costco’s grocery deals. And even if not, there are plenty of non-perishables you may be able to enjoy on your own well before they go bad.

Let’s say you’re an avid hiker and tend to go through trail mix pretty quickly. At Costco.com, you’ll pay $4 per pound of Kirkland Signature Trail Mix, which means you might pay even less at a Costco store (since store prices tend to be cheaper than what you see online). At Target, you’re looking at $5.60 per ounce for a similar trail mix blend.

2. You can benefit from exclusive travel packages

Booking a vacation through Costco could result in a lower credit card tab. And you don’t need to be part of a family or couple to enjoy travel. While some of Costco’s vacation packages are family-oriented, like the Disney experiences it offers, you can also book a relaxing trip to an island — one you take solo or with friends.

3. You can save on electronics and enjoy extended warranties

You never know when you might need to upgrade your laptop, TV, or phone. Costco sells a host of electronics at competitive prices. In fact, if you snag enough of a discount on a single electronics purchase, that alone might cover the cost of your annual membership fee.

Plus, when you buy electronics at Costco, you get a free second-year warranty included for peace of mind. You also get free tech support, so if you run into any issues setting up or using your devices, you can reach out for help.

4. You can stock up on apparel

If you’re not someone who’s ultra picky about clothing brands, you may find that Costco is a great place for a year-round wardrobe refresh. You’ll commonly find everything from swimwear to cozy fleece jackets to gloves to running shorts, depending on the season. And you might spend a lot less than you would at another retailer.

5. You can load up on vitamins and over-the-counter medication

Maybe you’re an allergy sufferer who takes antihistamines repeatedly during the spring and fall. And maybe you’re someone who takes a variety of vitamins and supplements to maintain your health. Buying these over-the-counter items at Costco could not only save you a nice amount of money but also help you avoid a scenario where you’re constantly running out.

That said, always pay attention to expiration dates when buying medication, vitamins, or supplements in bulk. With the latter two, you may be taking on less risk if they’re pills you take daily. But for pills you only tend to take sporadically, you may be better off buying a smaller bottle at your local supermarket or pharmacy.

There’s absolutely no rule stating that single people have no place at Costco. You might enjoy a host of benefits as a member, even if it’s just you.

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We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.Maurie Backman has positions in Target. The Motley Fool has positions in and recommends Costco Wholesale and Target. The Motley Fool has a disclosure policy.

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A high APY is arguably the most important factor when choosing a savings account, but it’s not the only one. Check out three other things to keep in mind. [[{“value”:”

When shopping for a new savings account, a high annual percentage yield (APY) is most people’s biggest concern. This makes sense because the APY determines how much you earn in interest over time. But it’s not the only factor that matters.

Even if you score one of the highest savings account APYs around, you could still find managing your money to be a nightmare if you’re dealing with any of these three problems.

1. You’re paying to keep your money there

Most high-yield savings accounts are available through online banks, and most of these don’t charge maintenance fees on their accounts. But there are a few out there that could charge you if you don’t maintain a certain minimum balance in your savings account.

Depending on the fee and your savings account balance, you could lose money over time rather than making it. In this case, the savings account isn’t worth holding onto, especially when there are so many high-yield savings accounts that don’t charge fees at all.

2. You don’t get a competitive APY on all your funds

Some savings accounts try to draw you in with a high APY on a small portion of your savings, perhaps the first $5,000 or $10,000. Then you earn a much lower rate on any remaining balance.

This might suit you just fine if you only have a small amount of money in your savings. But if you have a large sum stashed away, it makes sense to keep that money where it’ll earn you more interest. Consider looking for a savings account that pays a competitive rate on all your cash. As of March 2024, it’s not hard to find savings accounts paying at least 4% APY.

3. You have a hard time managing your account

Many Americans manage their money via online or mobile banking apps these days. But they’re not all created equal. An app that glitches or has limited features could make managing your money a challenge. And things are even worse if the bank has poor customer service and no nearby branches.

If you find yourself in this situation, you may want to consider looking for a bank with a highly rated mobile app. You can check this out by looking at the app’s reviews in the Apple App Store or the Google Play store to see what customers have to say.

Switching banks can be a hassle, but it’s worth it if it makes it easier for you to manage your cash and earns you a few extra dollars in the process. Just take your time and investigate your options carefully before you settle on one.

These savings accounts are FDIC insured and could earn you 11x your bank

Many people are missing out on guaranteed returns as their money languishes in a big bank savings account earning next to no interest. Our picks of the best online savings accounts could earn you 11x the national average savings account rate. Click here to uncover the best-in-class accounts that landed a spot on our short list of the best savings accounts for 2024.

We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Kailey Hagen has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet and Apple. The Motley Fool has a disclosure policy.

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Not all Americans have the same tax concerns. Keep reading for important tax considerations for those of us with unique financial needs. [[{“value”:”

In a perfect world, tax season wouldn’t be stressful at all — state and federal governments would tell us what we owe (or how much we overpaid) directly, and issue a tax refund or a bill, depending on your status. Unfortunately, that’s not the world we have, and so everyone you know gets to worry about calculating their income and expenses and showing their work every spring.

If you’re part of the LGBTQIA+ community, your taxes might be more complicated than the average American, due to the complexities of unique family and financial circumstances. Here are a few tips to ensure you pay your fair share of taxes for 2023 — and only your fair share.

1. Find a good tax professional

First and foremost, it really pays to have the right people in your corner to help you manage your financial situation. Tax planning should be a big part of that, especially if your family or financial situation is unique. The right tax professional can save you money on your tax bill and also set you up for successful money moves to reduce your tax bills in the future.

How do you find a good accountant? Start by asking the people you know and trust in your community. Ideally, it’s best to hire someone in your state (even if they’re not in your local area — they’ll still be experienced with state tax laws). Personally, I use an accountant in another part of my state, and we lean on technology (such as a documents portal on his firm’s website) to pass forms and information back and forth.

You can also use the IRS’s database of tax preparers to find someone local. Once you’ve got some prospects, ask questions. It’s a good idea to make sure you see eye to eye on communication (style and frequency). And ask about experience, especially if your family situation is outside the norm. A good accountant can be worth their weight in gold, especially if taxes stress you out.

2. Consider itemizing if it makes sense

Members of the queer community might have more opportunities to itemize on their tax returns, rather than taking the standard deduction. This is especially true if you’ve sought gender-affirming medical care, which certainly comes at a high cost. In fact, if you are itemizing on your tax return, you can deduct medical and dental expenses that come to more than 7.5% of your adjusted gross income (AGI).

But how do you decide if it makes sense to itemize? The standard deduction for singles for 2023 is $13,850 (more for other filing categories), so if you’re filing your taxes on your own and don’t have enough deductions to surpass that figure, take the standard deduction.

If you’ve got those big medical bills, or paid a lot in mortgage interest, or made a bundle of charitable donations, itemizing is worth exploring. Doing so will make your tax return more complicated, but you could also save money on taxes in the process.

3. Explore all available tax deductions and credits

This is another place where having a great accountant can really come in handy, but if you’re electing to go the DIY taxes route, tax software can help here, too. The best tax software programs pose a series of questions to users to suss out which tax breaks they might be entitled to. Plus, many of them offer access to a tax professional on demand, just in case you run into a thorny issue you can’t untangle on your own.

A tax deduction reduces the amount of your income that is taxable, while a tax credit reduces your tax liability. Some of these can be quite valuable. Tax credits you may want to explore include:

If you’ve adopted a child, dig into the nonrefundable adoption credit — your expenses along the way can reduce your tax bill.Queer folks face higher rates of poverty and we earn less on average — but if you qualify for the Earned Income Tax Credit (EITC), it may be able to help you stay afloat.Going back to the expenses of raising children, you have access to the Child Tax Credit even if your family looks nothing like Leave It to Beaver. Just be sure to review the qualifications carefully, as things can get complicated for multiple families co-parenting children.

The odds are good that your status as a queer American makes a lot of aspects of life more complicated (and perhaps, that much more rewarding). But there’s no reason to panic about tax season. Take a deep breath, find the right help, and ensure you’re finding all the tax deductions and credits you’re entitled to.

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This credit card is not just good – it’s so exceptional that our experts use it personally. It features a lengthy 0% intro APR period, a cash back rate of up to 5%, and all somehow for no annual fee!

Click here to read our full review for free and apply in just 2 minutes.

We’re firm believers in the Golden Rule, which is why editorial opinions are ours alone and have not been previously reviewed, approved, or endorsed by included advertisers.
The Ascent does not cover all offers on the market. Editorial content from The Ascent is separate from The Motley Fool editorial content and is created by a different analyst team.The Motley Fool has a disclosure policy.

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