Money Management

If you want to save on travel costs, picking an inexpensive place to visit helps. Check out 10 of the most affordable options for U.S. travelers. 

If you like to travel without spending a lot, you probably already know that the destination can make or break your budget. In some places, it feels like practically everything costs at least $100. Other places are made for budget travel. Thanks to Skyscanner’s Travel Trends 2024 Report, we have a list of affordable destinations for U.S. travelers.

10 of the most affordable destinations for U.S. travelers

Skyscanner ranked its top 10 cheapest destinations for U.S. travelers based on return flight prices. Here’s the full list and the average return flight price to the United States from each one:

San Juan, Puerto Rico: $295Vancouver, Canada: $300Nassau, Bahamas: $347Toronto, Canada: $348Cancun, Mexico: $422Calgary, Canada: $429San Jose del Cabo, Mexico: $429Bogota, Colombia: $440Puerto Vallarta, Mexico: $460Santo Domingo, Dominican Republic: $460

It’s not exactly the perfect method. Some of these cities made the list because they’re close to the United States and have major airports. It may be cheap to fly home from Vancouver, Toronto, and Calgary, but they’re not cheap destinations — an important distinction when you’re trying to take care of your finances.

But there are some low-cost destinations on the list. Having been to Bogota and Puerto Vallarta, I can confirm that both are very affordable. San Juan, Cancun, San Jose del Cabo, and Santo Domingo are also popular destinations where the dollar goes further.

Even with the more expensive places on the list, scoring a deal on airfare makes a big difference. Flights tend to be one of the major travel costs. And if you have points on hotel credit cards available, you could use those to cover a place to stay. Between that and a cheap flight, you’d be on your way to a budget-friendly trip.

How to find affordable places to visit

Lists of cheap destinations can help you come up with ideas, but it’s also easy to find them yourself. A popular method, used by 1 in 2 travelers who visit Skyscanner, is an “everywhere” search.

It’s just like a regular flight search, with one key difference: You leave the destination open. Lots of flight booking sites give you this option, including Skyscanner, Google Flights, and Kayak. My favorite is Google Flights, as I think it has the nicest interface.

After you enter all your other trip details, choose the “everywhere” or “anywhere” option for the destination field. The wording varies a bit depending on the flight booking site.

This will get you a list of destinations and the cheapest flight prices for each one. Once again, cheap flights don’t always mean a place is affordable. Flight costs will normally be lower for places close to your departure airport. So if you see a city you like, and you’re not sure if it’s actually affordable, do a quick search online to double-check.

Making the most of your travel budget

You don’t need all kinds of money in your savings account to travel. Plenty of travelers have had amazing experiences on shoestring budgets. An affordable destination helps, but here are a few more ways to travel for less:

Open travel credit cards and use them for all your regular expenses. These cards earn rewards you can redeem for travel purchases, so they’re an easy way to save.Set up deal alerts. Many travel booking sites will alert you when prices drop on the flight you want.Keep your travel dates open. If you’re willing to travel whenever, you’re more likely to find a good deal.

No matter how much you spend, travel is always more enjoyable when you’re not stressing about how you’ll pay for it. So if it’s something you love, save money in a travel fund for yourself every month. And when you do travel, make sure you can pay for it without going into debt.

Alert: highest cash back card we’ve seen now has 0% intro APR until 2025

This credit card is not just good – it’s so exceptional that our experts use it personally. This card features a 0% intro APR for 15 months, 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.

Read our free review

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.Citigroup is an advertising partner of The Ascent, a Motley Fool company. Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. Lyle Daly has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Alphabet. The Motley Fool has a disclosure policy.

 Read More 

Throughout American history, there has been price gouging. Here’s what the everyday consumer can do to put a stop to it. 

The term “price gouging” occasionally trickles into the American personal finance conversation. Some of us remember when $40 Tickle Me Elmo dolls sold for $100, and Sony Playstation 3 systems went for as much as $20,000 on eBay. Supply was low, but demand was sky high, making it easy for those who were inclined to price gouge to rake in the dough. And, of course, there are times of local or national emergency when everyday supplies, like bottled water, hand sanitizer, and toilet paper, are hoarded and sold at such a high markup that families are forced to draw from emergency savings accounts to pay for necessities.

But how can you tell when price gouging is taking place, and how can you tell the difference between gouging and inflation?

How you can identify the problem

The American Bar Association describes price gouging as the practice of raising the price of goods or commodities to an unreasonable, unfair, or excessive level, particularly during a declared state of emergency.

But it can be tricky to tell the difference between price gouging and inflation. In a nutshell, here’s how the two differ:

Inflation is a general increase in prices caused by ordinary economic factors like demand and supply over time. When demand is higher than supply, prices naturally rise. When supply is higher than demand, prices fall. It’s a natural occurrence.Price gouging is opportunistic. It frequently occurs on a smaller scale and often during a time when consumers have no option but to purchase a product at a much higher price. For example, if your area has just been hit by a hurricane and the only bottled water you can find for your family is being sold for 20 times the regular price, that’s price gouging.

The U.S. Public Interest Research Group (US-PIRG) says, “Businesses are allowed to increase prices, but they are not allowed to raise the price of products excessively to take advantage of a current crisis. While laws vary by state, increases exceeding 20% may be considered price gouging.”

Sometimes inflation is just inflation

As mentioned, inflation occurs naturally in the economy. Let’s say home builders suddenly have to pay 30% more for a necessary supply, like lumber. Rather than eating the loss themselves, the price of building a home will likely increase. If a company making sports jerseys is hit with a higher licensing fee from the NFL or MLB, the price of their jerseys will go up. Rising prices may simply represent a desire to stay in business.

The National Library of Medicine reminds us of a time early in the COVID-19 pandemic when a 2-liter bottle of Purell sold for as much as $250. That is clearly price gouging.

Flexing your muscles as a consumer

Often, it’s everyday shoppers who must look out for the financial well-being of their neighbors.

If you’re unsure if you’ve witnessed price gouging, US-PIRG recommends erring on the side of caution and reporting the incident to your State Attorney General’s office. You can find the office address, phone number, website, and email address online.

Consumer contact is the only way state officials can know whether price gouging is taking place. Thirty-seven states, plus Guam, Puerto Rico, the U.S. Virgin Islands, and the District of Columbia, currently have statutes or regulations against price gouging, and most of these laws enforce civil penalties.

Gather the following information before contacting your State Attorney General’s office:

Name and address of the store or vendor where you saw the item.Product details, like product type, brand, size, and asking price.Date, time, and location you saw the item.If possible, provide a picture of the item you saw.

There will always be those who are happy to empty a customer’s checking account to fill their own, but that doesn’t mean they have to get away with it. If enough consumers make a report when they notice suspected price-gouging, some of the worst offenders can be shut down.

Alert: highest cash back card we’ve seen now has 0% intro APR until 2025

This credit card is not just good – it’s so exceptional that our experts use it personally. This card features a 0% intro APR for 15 months, 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.

Read our free review

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 

Put your money to work for you in 2024. Read on for five places to consider stashing your savings. 

A new year means a fresh start — and for many, it means an influx of cash, too. Whether you received money for the holidays, got a bonus from your job, or got a raise at the start of the year, you now have to decide what to do with those dollars. Spending is always appealing, but you could get greater long-term value for your money by saving it. Here are five places you may want to put yours this year.

1. Your emergency fund

If you don’t have an emergency fund or yours is pretty small, this is the best place for your extra cash right now. Emergency funds are a critical safety net that can help you avoid debt in the event of unplanned expenses. Without one, you may have to resort to loans or costly credit card debt to cover your costs.

Your emergency fund should contain at least three months of living expenses, and many prefer to keep even more here. Stash this money in a high-yield savings account so you can access it whenever you need to.

2. High-yield savings account

A high-yield savings account is also a great place for cash you plan to spend within the next few years on big-ticket items. It’s generally not wise to invest this money because the stock market can be volatile in the short term. If you need to withdraw your cash at a specific time, you risk losing money if your investments are down.

Savings accounts can also help you grow your wealth. Your long-term returns won’t be as high as what you could get by investing, but right now, they’re still pretty impressive. Many of the best high-yield savings accounts are offering 4.50% annual percentage yields (APYs) or more. That could put $450 or more in your pocket in a year with a $10,000 initial balance.

3. Retirement accounts

Retirement accounts like IRAs and 401(k)s are great choices for savings you don’t need for several years, if not decades. These accounts allow you to invest your funds while reaping significant tax advantages. The near term could bring ups and downs, but over the long term, many grow their nest egg significantly through retirement account investing.

Just make sure you understand the rules associated with these accounts before putting your money here. They have contribution limits and penalties for withdrawals before age 59 1/2. Roth IRAs also have income limits that prevent high earners from contributing directly to them. Make sure you understand all these rules before contributing so you don’t run into problems with the IRS.

4. Taxable brokerage account

Taxable brokerage accounts enable you to grow your savings through investing without all the restrictions of retirement accounts. You can deposit as much as you’d like as often as you’d like, and you’re free to withdraw your money whenever you want. You also have complete control over your investments.

However, you won’t get the same tax advantages you would with a retirement account. You’ll owe taxes on your contributions in the year you make them, and you could owe taxes on your capital gains as well. That depends on how long you’ve held your investments for and your annual income.

5. Health savings account (HSA)

Health savings accounts (HSAs) can serve as retirement accounts, and some even enable you to invest your money. But their primary purpose is to help you cover medical expenses. The money you put in these accounts reduces your taxable income for the year, and if you use it on medical expenses at any age, it’s tax-free.

However, you can only contribute to an HSA in 2024 if you have a high-deductible health insurance plan. That’s one with a deductible of $1,600 or more for an individual plan or $3,200 or more for a family plan. If this doesn’t apply to you, you’ll have to consider one of the other options above.

There’s nothing wrong with splitting some of your savings between several of the accounts above if you’re not comfortable putting all your eggs in one basket. Just make sure you consider all your options so you can place your money where it’ll do you the most good.

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 can 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 

More money means more taxes, but falling into a higher tax bracket in 2024 isn’t cause for concern. Here’s why. 

When you get a pay raise, you may worry that the extra money will push you into a higher tax bracket. It’s true that earning more money means paying more taxes. But even if some of your money is taxed at a higher rate, you’ll still have more money in your pocket. Here’s why being taxed in a higher bracket isn’t something you should worry about.

How tax brackets really work

The IRS recently announced the following tax brackets for 2024:

As you can see, income taxes are progressive, which means that higher amounts earned are taxed at higher rates. But being taxed in a higher bracket doesn’t mean that all the money you earn is taxed at a higher rate.

It’s helpful to think of income tax brackets as buckets. If you earn above a certain threshold, the extra money will flow into the next bucket, i.e., the higher tax bracket. But only the money above that threshold flows into the next tax bracket; the rest of your money is still taxed at the same rate.

Here’s an example of how it works: Suppose you’re earning $45,000 and you’re a single tax filer. Your marginal tax rate — meaning the highest tax rate you pay — would be 12%. But your overall tax rate would be calculated as follows:

You’d owe 10% in taxes on the first $11,600 you earned, or $1,160.You’d owe 12% in taxes on the next $33,400 ($45,000-$11,600) you earned, or $4,008.

Your total tax bill, before accounting for tax deductions and credits, would be $5,168.

Now let’s say you get a $5,000 raise, which increases your income to $50,000. Suddenly, you find yourself in the 22% tax bracket. But alas, you shouldn’t panic or beg your boss to rescind your raise. Even though you’ve jumped from the 12% bracket to the 22% bracket, your overall tax rate didn’t increase to 22%. Instead, here’s what your tax bill would look like (again, before accounting for tax credits and deductions):

You’d owe 10% in taxes on the first $11,600 you earned, or $1,160.You’d owe 12% in taxes on the next $35,550 ($47,150-$11,600) you earned, or $4,266.You’d owe 22% in taxes on the remaining $2,850 ($50,000-$47,150) you earned, or $627.

Your total tax bill would climb to $6,073, which is $2,065 more than you were paying when you earned $45,000. But your income is $5,000 higher, which means you’ll take home an extra $2,935 after taxes.

Being in a higher tax bracket does mean that you owe more in taxes. But it’s still a good thing because your paycheck is higher.

How to lower your taxable income

When you file your taxes, you won’t have to do the math by hand to figure out how much you owe. The best free tax software makes it easy to calculate your tax bill and find out what tax credits and deductions you qualify for. These programs also help you determine whether you’re better off claiming the standard deduction versus itemizing.

But if you want to lower your tax bill for 2024 and beyond, here are some easy ways to do so, even if you don’t itemize deductions:

Contribute to a traditional 401(k)Contribute to a traditional IRAFund a health savings account (HSA)

Though you have options for reducing your tax bill, don’t sweat it if your income is likely to be taxed in a higher bracket in 2024 versus 2023. Ultimately, being in a higher tax bracket means you have more money in your pocket — which is a good thing.

Alert: highest cash back card we’ve seen now has 0% intro APR until 2025

This credit card is not just good – it’s so exceptional that our experts use it personally. This card features a 0% intro APR for 15 months, 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.

Read our free review

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 

Parents who are paying for the high costs of raising a child or paying for education may qualify for tax relief. Learn about four tax credits for parents. 

To say raising a child is expensive is an understatement. A middle-income family of four can expect to spend $233,610 to raise a child from birth to age 18, according to the U.S. Department of Agriculture.

Fortunately, parents often qualify for tax credits that can help offset a sliver of these staggering costs. A tax credit directly reduces the amount you owe at tax time. Depending on the type of credit, they could help you score a bigger tax refund. Here are four tax credits every parent should be aware of.

1. Child Tax Credit

If you have a child who was younger than 17 at the end of 2023, you could be eligible for the Child Tax Credit. The credit is worth up to $2,000 per qualifying child. Of that, up to $1,600 is refundable, which essentially means you can increase your tax refund by as much as $1,600 even if you don’t owe taxes.

Single parents with an income of less than $200,000 can qualify. For married couples filing a joint return, the income limit is $400,000. Taxpayers with incomes above these amounts may be eligible for a partial credit.

2. Child and Dependent Care Credit

Parents of young children may qualify for help with child care costs courtesy of the Child and Dependent Care Credit. The credit is available to parents of children who were 12 or younger at the end of 2023, provided that the parent (or their spouse) had earned income for the year, paid for child care, and needed child care to work or search for work. The credit may also be available if you paid for the care of another dependent who was unable to care for themself.

The Child and Dependent Care Credit is worth up to 20% to 35% of your expenses, depending on your income. It caps out at $3,000 for one child, or $6,000 for two or more children.

3. Earned Income Tax Credit

Many families with low or moderate incomes qualify for the Earned Income Tax Credit, or EITC, which is meant to provide relief to working families. Though you don’t need to have children to be eligible, parents can qualify for a larger credit. The EITC is available to taxpayers who earned less than $63,698 in 2023. The maximum value is:

$600 if you don’t have dependent children$3,995 if you have one dependent child$6,604 if you have two dependent children$7,430 if you have three or more dependent children

If your income is less than the standard deduction — $13,850 for single filers and $27,700 for married filing-jointly couples in 2023 — you’re not required to file a tax return. But if you’re a working parent whose income fell below these thresholds, the EITC could make it worth it to file a tax return anyway, as the credit is refundable.

4. Education tax credits

Parents who are paying for their child’s educational expenses may be eligible for either the American Opportunity Tax Credit (AOTC) or a Lifetime Learning Credit (LLC). Though you CAN claim both credits on the same tax return, you CAN’T claim both credits for the same student on the same return. Both are only available to individual taxpayers with an income of $90,000 or less, or married couples filing a joint return who earn less than $180,000.

The American Opportunity Tax Credit is worth up to $2,500 per student, of which 40% is refundable (up to $1,000). You can use the credit to help pay for undergraduate tuition, as well as some other education-related expenses, like books and supplies. The credit can only be claimed for any one student for up to four years.

The Lifetime Learning Credit is worth up to $2,000 per return. Unlike the AOTC, it isn’t refundable. But you’re not limited as far as how many times it can be claimed per student, and it can be used if your child is enrolled in an undergraduate, graduate, or vocational program.

Both credits are only available to parents who claim their child as a dependent for tax purposes. However, independent students may be able to claim either credit for their own educational expenses.

How to qualify for tax credits for parents

To claim any of the tax credits listed, the child needs to be your dependent. In IRS speak, that means you provide more than half of their support for the tax year.

Though the eligibility rules for tax credits can get confusing, the tax-filing software makes it pretty easy to figure out whether your child counts as a dependent and what credits you can claim on their behalf. If you’re not sure if you qualify for a tax credit, be sure to file a tax return, even if it isn’t required. Though filing taxes is never fun, it’s worth the effort to ensure you’re not leaving money on the table.

Alert: highest cash back card we’ve seen now has 0% intro APR until 2025

This credit card is not just good – it’s so exceptional that our experts use it personally. This card features a 0% intro APR for 15 months, 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.

Read our free review

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