Maintain a beautiful lawn with half the effort — if not less! Max Topchii / Shutterstock.com
Eco-friendly grass alternatives are as beautiful as turf and make for sustainable lawns that help the environment instead of harming it. With fewer toxic chemicals and less mowing, eco-friendly grass alternatives support a healthier ecosystem and safer yards for kids to play in. This article covers the best grass alternatives that can turn your lawn green. We’re discussing clover, no-mow grasses…
These are the states where you can potentially lower your tax burden in your golden years. Monkey Business Images / Shutterstock.com
Looking for a great place to retire? Or, wondering if the state where you live is too expensive? Property values, cost of living and lifestyle issues are all important considerations when figuring out where to live. However, don’t forget to think about state taxes. Some states are more tax-friendly for retirement than others. Explore more about retirement taxes, discover the best states for…
How much is enough money for an emergency savings fund? You’ll want to be able to cover your living expenses. Learn what to consider as you start saving. [[{“value”:”
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Financial advice you may often hear is the importance of having an emergency fund. By having extra savings in the bank, you can be better prepared if you have to pay an unexpected bill or a significant life change alters your financial situation. But how much should you save? Is $1,000 enough for your emergency fund? Find out more so you can better prepare for the unexpected.
Everyone’s personal and financial situation differs. That means the ideal amount needed in an emergency fund varies from person to person. A single person with no dependents may be OK with saving a smaller amount of money. However, a married couple with three children may want to save much more to cover their household expenses after an emergency.
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Is $1,000 enough? Probably not. Many financial experts recommend saving enough money to cover at least three to six months of living expenses. In today’s expensive world, $1,000 won’t buy much. For the average person, $1,000 likely won’t cover one month of living expenses.
If you aim to save at least three months of living expenses and your monthly household living expenses total $2,500, you’ll want to set aside $7,500 in your savings account. If that number sounds impossible to reach, don’t fret.
Many people spend months or years building their savings stockpile. Taking small steps to save is better than not saving at all. Over time, your emergency fund balance will grow.
If you’re starting to build an emergency fund, congratulations. This is an excellent personal finance goal to work toward. If you’re still deciding on a savings goal, here are some considerations to make when determining how much money to save for your emergency fund.
How much are your monthly expenses? Tally up the cost of all of your necessary bills, like utilities, groceries, and rent or mortgage costs. Doing this lets you know how much money you need to cover these expenses.
Consider how long you’d like to be prepared if you encounter an emergency. Would saving one to three months of expenses be enough, or would you feel more at ease saving enough to cover six months of bills? Only you can decide.
Now you can set a savings goal. If you’re feeling anxious because you’re working with a large number, break the total savings goal into smaller, more manageable goals. If you want to save $7,500 over two years, focus on saving $312.50 monthly.
No matter how much you plan to save, take advantage of the opportunity to earn interest while your money sits in the bank. Keeping your emergency fund in a high-yield savings account is an excellent way to earn interest while you build your savings stash.
If you keep your emergency savings in a checking account, you won’t earn interest. Interest payments could help you reach your emergency savings goals sooner. For additional money management guidance, check out our personal finance resources.
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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 cut your tax bill in 2024? See how these five commonly used tax breaks can reduce taxes for the average family. [[{“value”:”
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2024 tax season is here, and millions of Americans are gathering forms, scouring spreadsheets, and pressing “send” on their tax-filing software. If you’re trying to maximize your tax breaks in 2024, it helps to look at the big picture of how tax deductions and tax credits work.
For the purposes of this article, let’s look at how a “typical” American family would benefit from these five commonly used tax breaks. We’ll assume a family of three (two parents, married filing jointly, both age 40, with one child under the age of 17). And let’s assume this family earns the median U.S. household income of $74,580 (before taxes).
Here’s how much this “average” American family could save with these major tax breaks for 2024.
If you have a 401(k) plan or other employer-sponsored retirement plan at work, you can get an easy tax break. Just by contributing to your 401(k) out of every paycheck, you’re reducing the amount of wages or salary income that appears on your tax return. For 2024, employees can put up to $23,000 into a 401(k) or other qualifying plans like a 403(b), 457, or Thrift Savings Plan for federal workers.
Your 401(k) contributions are pre-tax dollars, or “tax-deferred.” That means you don’t pay taxes on your 401(k) contributions today; instead, you “defer” those taxes far into the future, when you’re in retirement and you take withdrawals from your 401(k).
How much this family can save: Let’s assume that this family puts a total of 5% of their income into a pre-tax 401(k) account in 2024. That would mean they’re socking away $3,729 for retirement — and subtracting that amount from their income for tax purposes.
Another form of tax-deductible retirement savings is the traditional IRA (Individual Retirement Account). This account lets people under the age of 50 put up to $7,000 into retirement savings in 2024, and the money is all under your control without having to use an employer-sponsored plan. Depending on your income, you can get a tax deduction for 100% of the money you put into a traditional IRA.
How much this family can save: This family’s income is well below the income limits for tax-deductible IRA contributions (they make less than $123,000 per year). So let’s say they make $7,000 of traditional IRA contributions in 2024. They’ll be able to deduct that full $7,000 from their income at tax time.
If you have a qualifying high deductible health plan (HDHP), you can get another great tax break. It’s called a health savings account (HSA). Let’s assume this family gets their health insurance through an HSA-eligible health insurance plan. For 2024, people with family health insurance coverage are allowed to contribute up to $8,300 to an HSA, and there are no income limits.
How much this family can save: Let’s say this family puts $200 a month into their HSA. By the end of 2024, they’ll have an HSA tax deduction of $2,400.
Many people don’t realize this, but there aren’t many clever, strategic tax deduction moves left for middle-income taxpayers. You cannot deduct your home mortgage interest, state and local taxes, or charitable contributions unless you take itemized deductions — and most people don’t.
The biggest tax break that many families get comes from the standard deduction. As a result of changes made by the Tax Cuts and Jobs Act of 2017, 87% of taxpayers now take the standard deduction. That’s because the standard deduction has gotten so large that it’s often a better deal for taxpayers to take the standard deduction instead of itemizing.
How much this family can save: We’re going to assume that this middle-income family will take the 2024 standard deduction of $29,200 for married couples filing jointly.
The Child Tax Credit is a valuable tax benefit for parents because it doesn’t just reduce your taxable income — it reduces the total taxes that you owe. As of 2024, the Child Tax Credit is $2,000 per child under the age of 17.
How much this family can save: We have assumed that this family has one child under age 17, so they will get a Child Tax Credit of $2,000.
Let’s do a quick rundown of how these deductions would work on this family’s tax return. The following table shows our assumptions from above, based on how much this family is saving with each type of tax-deductible account, plus the Child Tax Credit.
Here’s how much the typical family could save on taxes, compared to what they would owe if they did not put any money into a 401(k), IRA, or other tax-deductible accounts.
These five tax breaks would save this typical American family about $1,576 on taxes for 2024 compared to what they would owe without using any tax-deductible accounts. Want to save on taxes? Try to maximize your 401(k), traditional IRA, and HSA contributions in 2024.
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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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I’ve been a renter for my entire adult life. Find out why I don’t feel pressured to buy a home and how I’ve still been able to build financial success. [[{“value”:”
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When you live in the United States, you eventually hear about how renting a home is a terrible financial decision. You’ve probably already been subject to the typical cliches. You’re throwing money away by renting. You’re paying your landlord’s mortgage. Real estate is the best path to building wealth and long-term financial success.
There’s nothing wrong with renting or owning a home, but you shouldn’t buy one because of pressure from other people. I may buy a home one day, but I’m also fine with the idea of renting forever. Even though lots of people criticize renting, there are a few reasons I personally love it.
Buying a home is more expensive than renting in most major cities. Research by Visual Capitalist found that the average cost of buying a home is $2,697 per month, while the average cost of renting is $1,845 per month. That’s $852 more per month to buy.
This has been true for my personal experience, too. I’ve lived in the United States and abroad, and it’s consistently much more expensive to buy than to rent.
By renting, I’ve been able to invest much more money. I’m spending less on housing each month, and I also haven’t needed to set aside money for a large down payment. The key is using the money you save by renting to invest.
To show what kind of impact this can make, imagine that instead of using $30,000 for a down payment on a home, you invest it. You’re also able to invest an extra $852 per month. After 30 years invested at an 8% annual return (in line with the stock market’s average), you’d have $1.46 million.
As a renter, I’m responsible for keeping my place clean and in good condition, but that’s it. If the dishwasher or the HVAC system stops working, I just call my landlord and let them handle it.
That’s a big deal for me. I’m a writer. Home repairs are not my specialty. I don’t want to spend my free time watching YouTube videos on how to fix a sink or calling contractors and scheduling repairs. Not only do I save time on repairs and maintenance by renting, I also save money, since I’m not the one who has to pay for them.
If you’re sure you want to spend at least 10 years in one place, buying a house could be a good decision. You’ll have stability and the freedom to do what you want with your home. But I haven’t been sure about staying in one place. I love being able to move to a new city without the complications of selling a home.
That’s largely because of my personality. I like seeing new places, and I value flexibility more than stability. But it’s also because of my experiences moving around and staying in lots of different homes over the years.
I’ve learned that what initially seems like a dream home often has issues you only discover after living there. In apartment buildings, I’ve had to deal with noisy neighbors who start doing construction at 8 a.m. on a Saturday. I’ve also stayed in new, supposedly high-end homes, where it later became clear that the construction company cut corners and used cheap materials. In situations like these, I’ve always been thankful that I was only renting.
None of this is to say that renting a home is better than buying one. Each option has its pros and cons. It’s more about which option fits you, your personality, and your financial situation.
But there’s much more pressure to buy than there is to rent. No one tells homeowners that they’re throwing money away. Don’t let the pressure convince you to make a decision you regret.
Buying isn’t necessarily a better financial decision, and it’s entirely possible to be successful as a renter. I’ve rented my entire adult life, and my net worth is above average. If you manage your money well, including saving and investing regularly, you’ll be successful whether you rent or own your home.
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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.Discover Financial Services is an advertising partner of The Ascent, a Motley Fool company. Citigroup is an advertising partner of The Ascent, a Motley Fool company. Lyle Daly has no position in any of the stocks mentioned. The Motley Fool recommends Discover Financial Services. The Motley Fool has a disclosure policy.
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You might wonder if it’s too late to open a 529 account. It’s (almost) never too late. See how you can save for college, even for a child in high school. [[{“value”:”
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If you have a child in middle school or high school and you haven’t saved any money for college, you might wonder if it’s too late to open a 529 account in 2024. The good news is: It’s not too late!
No matter what age your child is or how much money you’ve saved for college, there is almost always an opportunity to improve your situation by opening a 529 account. And depending on where you live, you might even get a tax deduction on your state income taxes.
Let’s look at why it’s a good idea to open a 529 college savings account for your child — at any age, with any amount of money in the bank.
So often with 529 college savings plans, the advertising features babies and young children. As if every new parent is supposed to have thousands of dollars lying around to set up a college savings fund. Lots of people are living paycheck to paycheck, and the median American savings account is only $1,200. If you feel like you can’t afford to save for college, you’re not alone.
Saving for college can be especially difficult during the early years of parenthood, when you might be paying for extra expenses like child care. Young parents who are just getting started in their careers can also struggle to save; if you’re at a stage of life where you’re not making much money, it’s hard to save for retirement — let alone for college.
But sometimes, just as children grow up and get better at taking care of themselves, parents’ personal finances get better. You might be able to start saving more money after your children get old enough to be out of daycare and in full-time school. Your career prospects might improve. You could get pay raises and promotions, get a better job or switch to a better-paying field, or start side hustles or a small business. Just because you can’t afford to save for college when your child is 2 years old doesn’t mean you’ll still be in the same situation 10 years later.
For all these reasons, it’s important to keep in mind that it’s almost never too late to open a 529 plan, even if your child is 10 years old, 12 years old, or already in high school. You still have time to make a meaningful difference in helping pay for your child’s future college costs.
Let’s say you have a child who is a freshman in high school and you haven’t saved any money for college so far. You open a 529 plan and save $300 per month for the next four years. Let’s assume you invest your 529 savings in a diversified portfolio of stocks and bonds that deliver an average return of 6% per year. After four years, you’d have $16,694 saved for college.
Putting money into 529 savings plans is not the same as a 401(k) or traditional IRA — the contributions do not give you a deduction on your federal income taxes. But if you live in a state with income taxes, some of those states offer a tax deduction for 529 contributions. Check the rules for your specific state; for example, contributing to California’s 529 plan does not provide any state tax deduction.
In my home state of Iowa, parents (or other 529 account owners, like grandparents) can deduct 529 contributions of up to $4,028 from their Iowa adjusted gross income for 2024, per beneficiary account. That means an Iowa family with two parents and two children could save a total of $16,112 for their two kids’ college funds in 2024 ($4,028 per parent, per child) and deduct that full amount on their Iowa state income tax return.
This state income tax advantage makes it even more worth it to save for college, even if you got a late start.
If you want to know where to get started with a 529 plan, check out CollegeSavings.org, a website from the National Association of State Treasurers. This site has details on what you need to know about 529 plans, and its Find My State’s 529 Plan tool will help you find the right 529 program for your state.
Some states will only let you invest in 529 plans directly through the state’s program (called “direct-sold” savings plans); using your state’s direct-sold plan is often the best option, especially if you want low fees and state income tax deductions. Other states also let you invest in 529 plans through a financial advisor or brokerage. Many leading brokerages offer 529 accounts, including Schwab, Vanguard, and Fidelity, to help families save and invest for college.
Kids grow up too fast, and the future costs of college can feel overwhelming. But if your child is still in school, it’s not too late to open a 529 plan. Even if you only have a few years left before your child graduates from high school, you still have time to save and invest for college. And you might get a break on your state income taxes, too!
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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.Charles Schwab is an advertising partner of The Ascent, a Motley Fool company. The Motley Fool has positions in and recommends Charles Schwab. The Motley Fool recommends the following options: short March 2024 $65 puts on Charles Schwab. The Motley Fool has a disclosure policy.
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