Money Management

Want to open a CD in 2024? See why this longtime CD skeptic thinks now could be a good time to lock in a high APY on your savings. [[{“value”:”

Certificates of deposit (CDs) have never seemed like the right fit for my personal finances and savings goals. Sure, there are some advantages to opening a CD: You get FDIC insurance (or NCUA insurance at a credit union) and a fixed rate of interest on your savings. And CDs are some of the safest investments.

But the downside of a CD is that you have to lock up your money, sometimes for years. And until recently, the yields on CDs were so low, it just didn’t seem worth bothering. Unlike some investors who love to evangelize about their favorite stocks or asset categories, I was far from being a fan of CDs. Certificates of deposit just seemed like a sleepy backwater of the banking system.

However, in the past couple of years as the Federal Reserve has raised interest rates, certificate of deposit APYs have shot up to the point that CDs might be worth another look.

Here are a few reasons why the best CDs might be a more appealing option for your savings in 2024.

1. CD APYs are high — and might go down in 2024

No one knows if this is going to happen for sure, but it is widely expected that the Fed might cut interest rates in 2024. If interest rates come down, that means CDs with higher fixed APYs could be a good investment. Today’s best CD rates might be at their highest level for the foreseeable future.

For example, the best 1-year CD rates, as of Jan. 27, 2024, were as high as 5.30% APY. If you put your savings into one of those CDs, you’d lock in a 5.30% APY on your savings for one year. In case the Fed cuts interest rates by, let’s say, a total of 1% during the next 12 months, savings account APYs will also come down by a similar amount. So you might end up earning a significantly higher APY on your savings by locking in one of the best 1-year CDs today.

Want a longer-term commitment? The best 3-year CDs offer interest rates of up to 4.45% APY as of Jan. 27, 2024. If you believe that the Fed is going to cut interest rates in 2024 and leave them lower for the next few years, locking in a 4.45% APY on your short-term cash could be a smart move.

2. Locking up your money can be good for you

For most of my financial goals, CDs aren’t the right choice. Yes, I need cash: I like to have a comfortable emergency fund and enough money on hand to deal with short-term financial goals like home maintenance costs, vacations, or my kids’ orthodontic treatments and other healthcare costs. But a CD isn’t the right fit for emergency savings because I need fast access to that cash without paying early withdrawal penalties.

Simply put: I don’t want to lock up my money in a CD. I love having the flexibility of a savings account, even if the APY is lower than the best CDs. And I’ve always been passionate about saving; I enjoy the process of watching the numbers get bigger. I can stay on target for my savings goals without having to lock up my savings. But not everyone is able to do this. Some people could use a few extra nudges and guardrails to keep their savings on track.

Committing to a CD might be the right choice for you if:

You struggle to saveYou’re tempted to spend the money in your savings accountYou need an added layer of protection to hold yourself back from blowing through your savings

Sometimes putting your savings in a lockbox, “out of sight, out of mind,” can help you stay on target for your savings goals. If your money is committed to a CD for one year or longer, you might be more likely to leave the money alone and let it grow with compound interest.

3. Get creative with a CD ladder

Depending on your financial goals, CDs can be helpful for short- or medium-term investments. If you’re saving for something just a few years away — like a wedding, a down payment on a house, or a dream vacation — you might want to maximize the yield on your savings by using a CD ladder.

Let’s say you have a total of $20,000 of cash savings. You could divide it into five different CDs with a “ladder” of increasingly long terms, such as:

$4,000 into a 1-year CD at 5.50% APY$4,000 into a 2-year CD at 4.85% APY$4,000 into a 3-year CD at 4.45% APY$4,000 into a 4-year CD at 4.30% APY$4,000 into a 5-year CD at 4.30% APY

With a CD ladder strategy, you can avoid putting all your eggs in one basket. You can lock in some long-term APYs and some higher short-term APYs. After one year, your first CD will mature and you’ll have $4,000 of cash (plus $220 of interest) ready to put into a new CD or other investments, while your other CDs continue to grow.

Bottom line

When interest rates were near zero, I didn’t understand the appeal of CDs. But now that APYs might be at a high point, 2024 could be a good time to open a CD. Consider building a CD ladder to boost your chances of getting the best yield over time.

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Loud budgeting is about talking openly about being on a budget, and it’s taken TikTok by storm. Find out how it could help you reach your financial goals. [[{“value”:”

Money has traditionally been a taboo topic. But a recent viral trend on TikTok called “loud budgeting” aims to change that. Loud budgeting is the practice of being open about your budgetary constraints and financial goals. The concept took off after TikTok comedian Lukas Battle made a 2024 ins-and-outs video, declaring, “Out: quiet luxury. In: loud budgeting. Sorry, I can’t go out to dinner. I’ve got $7 a day to live on.”

Wondering if loud budgeting is for you? Here are four ways the concept could up your financial game.

1. You can set better boundaries

Saying no to another happy hour or a friend’s birthday dinner at a fancy restaurant can be tough, particularly if you’re a people pleaser. But loud budgeting makes things easier.

By being open about your budget, you make it clear that saying no isn’t personal. You’re simply setting a boundary with your money and committing to a life you can afford.

2. You may be more accountable

You don’t need to publicly announce your financial goals on social media to give loud budgeting a try. The idea is to be more open about how you’re spending and saving your money. It can be as simple as talking openly about your goals with a couple of friends or family members.

If you have a specific goal, like you’re trying to pay off credit card debt or get your emergency fund in shape, you may find that telling someone else about your goal makes you more accountable. Just be aware, though, that the research is mixed on this front. Some studies have found that announcing a goal can make you feel as if you’ve already achieved it.

So go ahead and be loud and proud about your budget — but be sure to do regular check-ins with your bank accounts to make sure you’re actually following through.

3. It can make saving money fun

Saving money can feel like an act of deprivation, especially if you feel like you’re the only person who can’t afford to spend. But loud budgeting makes saving money something to get excited about. Sure, maybe you’re passing up the new shoes you want or the weekend getaway that looks tempting. But you’re keeping your eye on the bigger prize, which is financial security. As you talk up that goal, you may find that saving money is actually fun.

4. You may inspire people around you

A lot of people aren’t comfortable talking about money. So if you give loud budgeting a try, you may be surprised to find that a lot of other people are stressing about the costs of things like going out, keeping up with the latest trends, and paying for gifts.

But when you’re open about money, other people may follow suit. They may feel as if it’s okay to express their own financial needs and goals. Anything that removes the shame surrounding money challenges is definitely a win.

How to make loud budgeting work for you

If you want to be successful at loud budgeting, here are some tips to follow.

Suggest alternatives to spending money. If a friend or family member suggests an indulgence that you’d rather not splurge on, like an expensive dinner, tell them it’s not in your budget. But suggest an alternative plan, like cooking at home or taking a walk, so it’s clear you’re not saying no to spending time together.Do a regular budget check-up. To make sure you’re actually following through on the goals you’re telling the world about, make sure you review your spending and income each month. A budgeting app can make the process easier if you want to automate the process.Don’t judge others’ spending. Loud budgeting is about spending money in a way that aligns with your goals. Not everyone has the same goals as you. So while being loud about your own budget is generally a good thing, keep your thoughts on other people’s spending to yourself.

Finally, if you’re not comfortable broadcasting your budget to the world, that’s okay. But do try to find someone you can talk to about money who can hold you accountable as you strive toward your goals.

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COVID-19 caused a boom in the private aviation industry, making it easier than ever for people to fly private. Check out what you need to know. [[{“value”:”

Remember when flying private was a fantasy reserved for rock stars and billionaires? Well, fasten your seatbelts, because the game has changed. In a world where a round-trip business class ticket on a long-haul international flight can set you back between $3,000 and a jaw-dropping $12,000, flying private for under $2,000 isn’t just a dream — it can be a smart personal finance choice.

This shift isn’t just about luxury; it’s a clever workaround to the headaches of commercial travel. You can skip the endless lines and cramped seats, jetting off in style and comfort without taking out a second mortgage. The pandemic’s silver lining? It’s turned private jet travel from an exclusive privilege into an accessible extravagance. With new companies entering the fray, the once steep prices have nosedived, making your private sky-high adventure more attainable than ever. Here’s how you can join the private jet set without burning a hole in your checking account.

Check out the charter open marketplaces

Charter open marketplaces have emerged as a game-changer in private aviation, offering a seamless way to book private flights. Services like JetASAP epitomize this trend. Launched in November 2020, JetASAP is akin to the “Airbnb for air travel,” providing a platform where fliers can directly connect with charter operators. Its user-friendly app and website offer a free feature to search for flights, and for those seeking more, there’s unlimited access for $79.99 per month or $149.99 per year.

The beauty of JetASAP lies in its commission-free structure — users simply input their flight request, including departure airport and preferred times, and receive quotes directly from operators. With access to over 1,000 bookable daily trips, options are plentiful and can be surprisingly affordable. For instance, a recent search on the platform revealed one-way tickets as low as $1,000 for short hauls, and a flight from Miami to Chicago on a midsize jet (eight to 10 seats) for $7,500 — split that with seven friends, and it’s just $937.50 per person.

Join a membership program

For those who prefer the traditional route with a bit more guidance, numerous charter companies offer various services. These include personalized assistance in choosing the right aircraft and managing logistics from door to door. Companies like Aero, Wheels Up, Blade, Air Partner, Private Fly, and Jettly have made a name in this space.

Aero, founded in 2019, is known for its white-glove service on sleek 16-seater black jets, offering flights to glamorous destinations such as Aspen, Los Cabos, and Nice, with tickets starting at $975 per leg. This option suits those who desire a more tailored flying experience without the commitment of long-term contracts or membership.

Share your flight with others

Fly-sharing has emerged as the most budget-friendly way to experience private aviation. Companies like JSX, Set Jet, and XO are at the forefront of this trend, offering a unique blend of luxury and affordability.

JSX, for example, operates 30-seat jets out of private terminals, with one-way tickets starting at just $249. Serving various markets and in partnership with United Airlines, JSX allows travelers to earn MileagePlus miles.

Set Jet, with a $99.95 monthly membership, offers one-way flights starting at $750, catering to spontaneous travelers who can book flights up to 24 hours before takeoff.

Lastly, XO’s shared membership, priced at $595 per year, grants access to a vast fleet of over 2,450 jets. You can book an entire charter or just a seat on a plane. For example, a recent search showed one way short-haul flights with 6 passengers for $2,495 ($415 per person). Or, you could book a seat from New York to South Florida for $1,295. XO also offers the option to crowdfund a flight. So you could get a few friends together, decide on a route, and see if anyone else is interested in booking that same route.

What does it mean for you?

In a nutshell, flying private isn’t just for the ultra-rich anymore. Thanks to the pandemic shaking things up, now anyone can snag a seat on a private jet for less than the cost of some business class tickets.

Whether you’re using an app, joining a membership program, or sharing a flight with others, there are plenty of options to get you in the sky without breaking the bank. It’s a whole new world of travel — private jets are suddenly accessible and, honestly, pretty exciting for those of us (raising my hand) who never thought we’d step foot in one.

Where to invest $1,000 right now

When our analyst team has a stock tip, it can pay to listen. After all, the newsletter they have run for over a decade, Motley Fool Stock Advisor, has nearly tripled the market.*

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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.
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