Money Management

When an emergency forces you to take funds from savings, follow these pointers to help you get your rainy day fund back ASAP. [[{“value”:”

Saving for emergencies is absolutely crucial, with Pew Research showing 6 in 10 households experienced an unexpected financial shock over the prior 12 months.

Unfortunately, once you have an emergency, a good amount of that money you worked so hard to put into your savings account could end up being used to cover the surprise costs. That’s not a problem since that’s what the money is there for. But if another emergency happens soon after, you could be at risk of ending up in the credit card debt you tried so hard to avoid since you’d no longer have the financial reserves to see you through.

This isn’t an uncommon situation, with the same Pew Research study also revealing that a third of households had two or more unexpected financial shocks in the prior year. The good news is, you can reduce the chances you’ll need to rely on an already-drained emergency fund by saving up the money to replace what you took out ASAP. Here are a few tips to help you do just that.

1. Pause extra debt payments

If you’ve been working on paying extra on your debt, it’s worth pausing that effort and redirecting that money back into your emergency fund until it gets back to where you need it to be (which usually means having three to six months of living expenses saved).

While it may be annoying to stop your extra payments, it would be far worse to have an emergency when your rainy day fund is empty and be forced to borrow again as you’re trying to dig yourself out of your hole. This could be discouraging and cause you to lose momentum.

Depending on how much you had to take out of your emergency fund, ideally you will only have to pause debt payments for a short while — especially if you also implement some of these other techniques. As soon as your emergency account balance is back where it should be, you can start up again.

2. Consider a side job

Side hustles earn an average of $483 every month. If you are able to jump into working a side gig for just a little while, this can help you to replenish your emergency savings. Just remind yourself that it’s only temporary until you have the funds you need to provide peace of mind and protection from disaster.

3. Save “found money”

While you are trying to build your emergency fund back up, it makes good sense to divert money you don’t have other plans for toward this goal. So, for example, if you get a tax refund that you don’t need to pay for bills or other necessities, put it in the bank. Same thing for cash gifts for birthdays or holidays, or an unexpected bonus you get at work.

Your emergency fund needs this money to get back to a safe level more than you need it for other non-necessities, so don’t waste the chance to use these free dollars to get back your security.

4. Sell unnecessary items

Chances are good you probably have stuff around the house you aren’t using. Consider listing it on Facebook Marketplace or Craigslist to see if anyone will pay you for it. If you can sell things you don’t need, you’ll not only get more money to put away for emergencies, but you can also declutter your space.

5. Slash your budget temporarily

Finally, consider making big budget cuts to expenses like entertainment and dining out until you have your emergency account fully funded again.

You shouldn’t have to do this for too long, depending again on how much you took out of your emergency money in the first place. And since you just relied on your savings to get you through a tough spot and you know how important it is to have that financial cushion, you may be able to stay motivated to make those short-term sacrifices.

By taking these steps, you should be able to get your emergency account built back up quickly. Then you will once again benefit from the financial security that comes from knowing a bump in the road won’t derail your personal finances for years to come.

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.The Motley Fool has a disclosure policy.

“}]] Read More 

Need to borrow money? Read on to see why a personal loan may be a better choice than a credit card. [[{“value”:”

Credit cards and personal loans are popular options for borrowing money. TransUnion reports that during the third quarter of 2023, U.S. personal loan balances rose 14.8% from a year prior, while credit card balances rose 15%. So even though consumers owe a lot more money in credit card form than personal loan form — $995 billion, compared to $241 billion — it’s fair to say that both are pretty common.

If you need to borrow money, you may be wondering whether it pays to take out a personal loan or simply rack up a balance on a credit card you might already have. The latter option may seem easier. But here are some benefits that personal loans offer over credit cards.

1. Lower interest rates

You’re not guaranteed to pay a lower interest rate on a personal loan than a credit card. But usually, that’s the case. This especially holds true if you’re an applicant with strong credit. And the lower the interest rate on your debt, the more affordable your monthly payments might be.

That’s important, because if your monthly payments become unmanageable and you fall behind on them, it could seriously damage your credit score. From there, you might have a hard time borrowing money the next time you need to.

2. Fixed monthly payments

The interest rate on credit cards tends to be variable, which means your minimum monthly payments have the potential to increase from one month to the next. That can make credit card payments difficult to work into your budget.

With a personal loan, you’re signing on for a fixed interest rate. Your monthly payments will be the same until your loan is paid off in full (assuming you don’t refinance that loan, in which case your payments might change, but hopefully for the better in that scenario).

3. Protection from credit score damage

Any time you apply for a new loan or line of credit, a hard inquiry is done on your credit report that typically results in a minor credit score drop. But from there, paying back an installment loan on time every month could give your score a nice boost, since your payment history carries more weight than any other factor when calculating that number.

Credit card debt, on the other hand, has the potential to hurt your credit score, even if you’re making your monthly payments on time. That’s because another big factor that’s part of your credit score is your credit utilization, or the amount of available revolving credit you’re using at once.

Once your credit utilization ratio reaches a certain point (usually, when it exceeds 30%), your credit score can sustain damage even if you never miss a payment. With a personal loan, your credit score won’t take a hit by you having that loan beyond the minor drop that results from that initial hard inquiry.

All told, it pays to consider a personal loan over a credit card the next time you need to borrow money. You may find that a personal loan is less expensive from an interest rate perspective and a lot less stressful to pay off.

Our picks for the best personal loans

Our team of independent experts pored over the fine print to find the select personal loans that offer competitive rates and low fees. Get started by reviewing our picks for the best personal loans.

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.

“}]] Read More 

Late tax returns can lead to costly penalties in some situations. Here’s what you need to know before the tax deadline arrives. [[{“value”:”

I’ve yet to meet a person who lists filing taxes among their favorite pastimes, but it’s in most Americans’ best interests to do it anyway. The deadline to file your 2023 taxes is April 15, 2024, so you’ve still got time. But you probably don’t want to put it off too much longer.

There are steep penalties for failing to file your return on time. But fortunately, they are avoidable in certain circumstances.

What happens if you don’t file your tax return?

There’s a chance that nothing serious will happen to you if you don’t file your tax return if your income during the year was less than the standard deduction for your filing status. The table below can help you figure out what yours is for the 2023 tax season:

However, even in this situation, you may still need to file a return if you had any self-employment income or owe estimated taxes or alternative minimum tax (AMT). You also need to file a return if you hope to claim certain refundable tax credits, like the Earned Income Tax Credit (EITC).

You can also get away without filing a return if you’re due a refund. But again, you won’t get the money you’re owed back unless you do. So it’s usually worth it to submit your return anyway.

If you owe the IRS and don’t submit a return, you’ll pay a failure to file penalty of 5% of your unpaid taxes per month, up to a maximum of 25% of the taxes you owe. You’ll also face a failure to pay penalty of 0.5% of the amount unpaid per month, up to a maximum of 25%.

The IRS might also decide to come after you for tax evasion. In the worst cases, this could result in hefty fines — sometimes six figures or more — and even prison time.

How to avoid penalties for not filing your tax return

The best way to avoid any negative consequences for failing to file your tax return is to file it by the deadline. You can do it yourself with tax software or enlist the help of a qualified tax professional in your area.

If you can’t file your taxes by April 15, you may request an extension. This gives you an additional six months to file your return. But it doesn’t give you an extension to pay any taxes due. So you won’t have to worry about the failure to file penalty if you do this. However, if you owe the IRS money, you will still incur the failure to pay penalty.

Don’t delay filing even if you’re worried you have a tax bill you cannot afford. The IRS has several payment plan options to help taxpayers who cannot pay their bills in a lump sum. Explore these options and consult a tax professional if need be to determine the best way to pay your taxes.

Alert: our top-rated cash back card now has 0% intro APR until 2025

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.

“}]] Read More 

Costco is known for carrying a little of everything. Here are five products sure to impress the savviest Costco shopper. [[{“value”:”

There are roughly 128 million Costco members worldwide. And of those 128 million members, it’s safe to assume that most have their favorite items — products they intend to purchase each time they enter a Costco warehouse. But what if they’re missing something, a deal so great that buying it anywhere else is a waste of money and a huge personal finance don’t? Here, we will look at five products we never imagined buying at Costco.

1. Simparica TRIO

Costco price: $23 (1-month supply), $126 (6-month supply), $251 (1-year supply)Chewy price: $35 (1-month supply), $175 (6-month supply), $350 (1-year supply)

Properly caring for a pet is expensive, and a big part of that expense is preventive care. Take, for example, a monthly chewable most vets recommend to protect your dog from heartworm disease, fleas, ticks, roundworms, and hookworms. One such preventative chewable is Simparica TRIO.

If you were to buy a 1-month supply of Simparica TRIO for an 11- to 22-pound dog, you would pay $35 on Chewy.com. At Costco.com, the same 1-month supply costs $23. If your vet writes a prescription for a 6-month supply, it will run you $175 at Chewy and $126 at Costco.

Finally, if you want to get it over with and buy an entire year’s worth, you’ll pay $350 on Chewy. At Costco, it will cost you $251. Even if you have great pet insurance, it’s possible that preventive care is not covered. It pays to take every break available at Costco.

2. Almost Heaven Duet 2-person Outdoor Sauna

Costco price: $2,700Walmart price: $4,236

For most Americans, having a Finnish sauna in their backyard is not a priority. However, a sauna might be the right choice for the person seeking increased blood circulation, pain reduction, stress management, and improved sleep. According to the National Library of Medicine, these are just some of the benefits touted by facilities offering saunas (although medical evidence is incomplete).

However, if you’ve been looking for an outdoor sauna constructed from red cedar with a full glass door and two full-length benches, Costco’s price is tough to beat. In fact, making the purchase at Costco as opposed to Walmart will save you more than $1,500. That’s $1,500 extra you have to pad an emergency fund or pay down a debt.

3. Budget Truck rental

Costco price: 25% off the regular rental price in your area

Have you ever needed a truck to move residences or to pick up a large item you purchased at an estate sale? If so, you know what a hassle it can be to find a vehicle that’s priced affordably and available when you need it. Your Costco membership may not be the first thing you think of as you search for a rental truck, but with 25% off everyday prices in your area, it’s a nice option to have at your disposal.

4. Kio 32″ Round LED Lighted Mirror

Costco price: $380Home Depot price: $680

If you’ve ever stood at the bathroom mirror shaving and suddenly found yourself humming a tune from Sweeney Todd, or applying makeup, hoping against hope that you don’t leave the house looking like a toddler who’s gotten into their mother’s makeup bag, you’ll love this deal. Costco offers the Kio 32″ Round LED Lighted Mirror for $380.

This frameless mirror is not only great looking, but it’s technologically up to date. For example, touch button controls allow you to easily select how bright you want (or need) it to be, and it has an integrated defogger, so you don’t have to wait around after jumping out of the shower.

While the mirror would make a great addition to the bathroom, it would also work beautifully above a vanity table.

It’s safe to say that Costco is not the first place most of us head to when working on home improvement projects, but at this price, you may have enough money left over in your bank account to hire an electrician to install it.

5. Aquaterra Spas Montecito 45-jet, 6-person Spa

Costco price: $4,300Shop EZ USA price: $5,059

Whether you’re currently snowed under in the Northeast or enjoy nothing more than a dip in the hot tub on a cool desert evening, this 45-jet, six-person spa is the real deal. It comes with multicolor LED lights, an adjustable waterfall, and an ozone water care system. Plus, at 81″ x 81″, most will have enough space to stretch out.

We all know that it’s possible to save money on staples — like bread and milk — at Costco, but the warehouse store is also a great place to keep in mind when shopping for necessities for your pets or luxury items.

Alert: our top-rated cash back card now has 0% intro APR until 2025

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.Dana George has positions in Walmart. The Motley Fool has positions in and recommends Costco Wholesale and Walmart. The Motley Fool has a disclosure policy.

“}]] Read More 

Costco Travel is awesome. But read on to see why this writer can’t use the service for an upcoming trip. [[{“value”:”

I’ve been a Costco member for about 18 years now. But there are certain membership perks I’m less familiar with than others.

For example, I know a lot of people love Costco’s optical center. I’ve never gotten my glasses there, though, since I’m a Warby Parker fan. And while I know Costco’s pharmacies can be a source of savings on prescriptions, because I’m able to order most of mine in bulk through my insurance, I find that my current system is cost-effective.

One service of Costco’s I’ve only used once is its travel service. And that trip didn’t even end up happening because it was scheduled for the summer of 2020 and was subsequently canceled due to COVID-19.

Since then, I’ve tried using Costco Travel for different vacations. But the nature of Costco Travel is such that it hasn’t been a good fit for the trips I’ve taken recently. And it’s not a good fit for the summer vacation I’m trying to plan.

A wide range of options — if you want a certain type of trip

If you look at Costco Travel, you’ll see a host of options for booking cruises, hotels, and resorts. Some of the deals look pretty awesome.

Here’s the problem, though. Costco’s travel packages tend to target popular destinations — think resorts in the Caribbean, Hawaii, and Disney. But I specifically like to plan trips that are off the beaten path and not so loaded with tourists.

Last summer, for example, I spent a week in Northern Michigan, during which time my family had multiple hiking trails and beach spots to ourselves. This summer, we’re hoping to do some hiking in Northern Maine. And while I don’t expect to have the area to ourselves per se, it’s not an area that draws nearly the same crowds as a place like Disney.

Costco Travel doesn’t really offer much in the way of trips like that, though. If you search through Costco’s list of destinations on its site, Maine isn’t one of them. Neither is Michigan. That’s not shocking. But it also explains why using Costco Travel often isn’t feasible for me.

Be mindful of Costco Travel’s limitations if it’s a draw in signing up

If you’re someone who enjoys traveling, you may be inclined to join Costco to gain access to its travel service. But if you’re someone who prefers to steer clear of crowds and carve out your own adventures, then Costco Travel probably isn’t going to be your go-to source for trip planning.

Now, I’ll admit that I’m not someone who feels a big need to plan trips down to the details. I like to wing it while traveling and get tips from locals once I’m at my destination. Last year, for example, while hiking in Michigan, we ran into some random people at a trailhead who told us about an amazing spot we were able to check out later that day.

I should also mention that I’ve been to Northern Maine before and already have a few spots in mind. So frankly, not being able to plan my trip through Costco Travel is no big loss.

The benefit of booking a vacation package through Costco Travel is that all of the details will be sorted out for you. You can get away with doing very little research if that’s what suits you. And sometimes, it’s nice to be able to swipe your credit card and hand the planning over to someone else. But unless Costco Travel widens its scope, it’s probably not going to be a service I use often.

Also, while you can save some money by booking trips through Costco, there are other tactics you can use as well. On my end, I tend to choose cheaper destinations to begin with. I also tend to pick destinations that are accessible by car so I’m just paying for gas and tolls instead of springing for flights.

I may end up booking a trip through Costco Travel at some point. But that’s not an option for this summer.

Alert: our top-rated cash back card now has 0% intro APR until 2025

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.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.

“}]] Read More 

CDs are a safe place to get a fixed interest rate on your money. Check out these underappreciated reasons why investing in CDs could be a good idea. [[{“value”:”

Certificates of deposit (CDs) are a popular way to grow your savings. They offer fixed interest rates over a set period. They’re also available through FDIC-insured banks, so they’re considered a safe investment option. And they offer some impressive payouts — the best CD rates are currently above 5.50%.

If you’re familiar with CDs, you probably already have an idea of how they work and their benefits. Here are the underrated reasons why CDs could be the place for your savings.

1. They make it easier to commit to saving money

When you put your money in a traditional CD, you need to keep it there for the full term. On a 2-year CD, that means locking up your money for two years. If you take it out sooner, you’ll pay an early withdrawal penalty. This is normally a few months of interest.

While this seems like a drawback, it could help with sticking to your savings plan. If you want to keep $5,000 in savings, and you put it in a savings account, nothing is stopping you from withdrawing it. You could later find yourself tempted to take out money to pay for a vacation or the latest smartphone.

You’re less likely to do that with a CD. When you know you’ll pay an early withdrawal penalty, there’s more motivation not to take out your money.

2. This may be the highest that rates will get

CD rates are excellent right now. They’ve gone up quite a bit because the Federal Reserve has been raising benchmark interest rates. But it’s expected to lower rates at some point this year. If it does, then banks will almost certainly lower their CD rates.

There’s no guarantee of what will happen with CD rates, but there’s a good chance we’re at the peak. If you’re interested in opening one, it makes sense to lock in a rate now.

3. They’re a low-maintenance investment

Because of how CDs work, you don’t need to spend any time managing them. Once you’ve picked a CD and deposited your money, there’s nothing to do until the maturity date.

Most investment options aren’t so hands-off. When you invest in stocks, you spend time researching companies and managing your portfolio. That doesn’t mean stock investing is worse than CD investing. Most people should invest in stocks because of the returns they offer. But CDs take far less time, which is one of the reasons they’re such a great short-term investment.

4. They’re more flexible than you might think

One of the reasons people avoid CDs is because they don’t want to lock up their money for a long time. But CD investing can be more flexible than many realize.

There are CDs with terms ranging from one month to 10 years, and just about everything in between. You can open as many CDs as you want, so some investors open multiple CDs with different maturity dates. This strategy is known as CD laddering. You open CDs based on when you’re going to need the money.

While you can’t withdraw your initial deposit early, some banks let you withdraw the interest you earn. If you get a CD that allows this, you’ll be able to use the interest as a form of steady income.

The APYs are definitely the most eye-catching CD perk. And they are one of the best reasons to open a CD right now, especially since they may drop later in the year. But they’re not the only reason, as there are plenty of other underrated benefits of investing in CDs.

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.The Motley Fool has a disclosure policy.

“}]] Read More