Money Management

Opening a new bank account may not be your first thought when you decide to join the gym. This may change your ways. 

It’s that time of year again, when we all take a long look at that holiday weight gain and think, “Ugh.”

For many of us, that thought inevitably leads to the thought that joining a gym may not be a bad way to start the new year. If that’s you, I have a tip for what you should do first: Open a new bank account.

Gyms are increasingly requiring ACH payments

Alright, so it’s not the most intuitive bit of advice, but it will make sense when I tell you that many gyms are now requiring you to pay your monthly membership fees via ACH bank transfers.

That’s right, your gym wants your bank account information.

There are two main reasons why your gym might want you to pay this way instead of with your trusty credit cards:

It’s cheaper for the merchant. ACH transfers cost pennies. In contrast, credit card companies typically charge merchants 1% to 3% of a transaction to process it.It’s harder for you to stop payments. Credit cards issuers make it pretty easy to file chargebacks on naughty merchants, while banks usually charge fees to stop recurring payments on their end.

Like it or hate it, if you want to join one of these gyms, you’re going to have to give them access to a checking account. That’s why you should open a new account dedicated just to the gym.

Giving any merchant access to your primary bank account is already a bad idea simply from a security standpoint. Your account information is only as secure as the least secure company that has it. How good is your gym’s cybersecurity?

Then, once you consider how much hassle it could be to deal with a gym that won’t stop billing you no matter how many times you try to cancel, well — get that new account.

The bonus could pay for your membership

Another big reason I advocate opening new bank accounts for, well, anything really: The welcome bonuses. Similar to the bonuses credit cards offer, many banks have new account bonuses for their checking and savings accounts.

In yesteryear, just opening the account was enough to score a sweet kitchen appliance. (Yes, kids, this really was a thing!) Nowadays, you generally have to do a bit more to get your bonus — but it’s usually a lot more valuable than a toaster. I’ve earned bank bonuses worth $300.

Requirements for new account bonuses are usually along the lines of setting up a direct deposit, or making a certain number of debit card transactions. Just choose an account with a bonus you can comfortably meet. Then, you can use the welcome bonus to cover your monthly gym fees.

How to stop payments to stubborn gyms

Once you give a company permission to start recurring transfers out of your account, it can do so until you specifically revoke that authorization. In a perfect world, you could go online, hit a “cancel” button, and that would be that.

This is not that perfect world.

Gyms, in particular, are notorious for making it hard to cancel, or for charging people even after they have cancelled their membership. Closing the account may work in some cases, but it’s not a guarantee that the bank will stop accepting recurring charges.

Instead, you’ll need to inform both the gym and the bank — in writing — that you are “revoking authorization.” And yes, you should use that exact phrase somewhere in your letter.

You can also choose to use a “stop payment order” with the bank. Most banks will charge a fee for this service, but it works even if you haven’t specifically revoked authorization yet. You may be able to do this online or through the bank app, but some banks may require it in writing, especially if you’re trying to stop all future payments, too.

Dispute unauthorized transactions right away

If you’ve cancelled your membership and revoked authorization, but the gym still charges you anyway: Dispute it.

You can dispute any unauthorized transaction by law. For the best results, it needs to be done within 60 days of the transaction. The bank will then investigate to see if the transaction was really unauthorized. Show the bank proof that you cancelled your membership and revoked authorization, and you should get your money back.

Do you need to open a new bank account when you join the gym? Of course not. You can absolutely just hand over your primary bank account information. But considering a new account offers both better security for your money and the potential for a bonus, well, it seems like an easy call to me.

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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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Are you sick of an expensive grocery bill? You’re not alone. Find out what changes one writer is making to save money when buying groceries. 

I plan to shop at my local grocery store chain as little as possible this year. A complete breakup is impossible, because this chain sells some items I can’t buy at other nearby stores. Since I have Target and Aldi locations near my home, I plan to do most of my grocery shopping at these stores. I’ll rely on my local chain to fill in the gaps. Let me explain why.

I’m sick of overpaying for my groceries

I’m well aware that rising food costs are a nationwide issue. But I’m a savvy shopper who uses mobile apps and sales fliers to track pricing trends at various retailers in my community. I’ve noticed for a long time that my local grocery chain has much higher prices overall.

Stores like Aldi and Target continue to sell many grocery items at a reduced cost. Sure, some items are occasionally cheaper at the local chain, but generally, I can expect to pay more when I shop there. While the local chain has more convenient locations and a better selection of food and other goods, I end up paying more for the same food I can get elsewhere.

This week, I researched a few of the same grocery items available at Target and my local chain to compare their prices. For the most part, prices were cheaper at Target.

Take a look below:

Buying these essentials at Target would save me $7.50. I imagine the savings will add up if I habitually do most of my grocery shopping at retailers like Aldi and Target. I’m committed to altering my shopping habits to boost my savings account balance.

Pay attention to your spending

Paying attention to prices when shopping is essential. Paying a bit more may not seem like the biggest deal, but it all adds up. Every time you pay more than necessary, your personal finances are impacted.

Do you want to stop overspending on groceries in 2024? You can use your local retailer’s mobile apps to research product pricing and view sales fliers before you go to the grocery store. Doing this can help you make a grocery list that allows you to stay on budget. Shopping at more affordable stores could help you keep more money in the bank.

One final tip: Use a rewards credit card at checkout. If you’re paying for your groceries with a credit card, ensure it earns rewards. You can earn points, miles, or cash back on your spending. Check out our best cash back credit cards list to learn more.

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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.Natasha Gabrielle has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Target. The Motley Fool has a disclosure policy.

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BOI Reporting is an important new federal requirement in 2024 that could affect your small business. See how to stay in compliance and avoid penalties. 

Small business owners have to deal with a few different types of legal compliance and document filing requirements throughout the year. But along with forming an LLC, filing annual reports for a corporation, or filing business tax returns, now there’s a new one called “BOI.”

Have you heard about BOI reporting for small businesses? If not, pay attention, because it’s kind of a big deal. Beneficial Ownership Information (BOI) Reporting is a new federal reporting requirement for small businesses that took effect on Jan. 1, 2024. It’s managed by the U.S. Department of the Treasury’s Financial Crimes Enforcement Network (FinCEN).

If that sounds intimidating, don’t panic! BOI Reporting is a way for the U.S. government to stop criminals who use shell companies to cover up their financial crimes. But the government needs your help — and depending on when you started your small business, the BOI reporting deadline could be sooner than you think.

Let’s take a look at what BOI Reporting means, why it’s important for your small business, and why you won’t want to forget to file your information with the federal government.

What is BOI Reporting?

Beneficial Ownership Information (BOI) Reporting is a new requirement that took effect on Jan. 1, 2024, as part of an act of Congress called the Corporate Transparency Act of 2021. This law is intended to make it harder for criminals to use shell companies or opaque business ownership structures to hide their ill-gotten gains.

Compared to many other countries, America makes it easy to start a business. In most states, with just some simple paperwork and a small fee, you can set up a small business that has its own separate identity for banking, taxes, and liability purposes. There are many ways to set up a business structure, such as an LLC (limited liability company), corporation, or other business entity.

But sometimes, it’s a little too easy for just anyone to set up a business and get access to a business bank account. The same openness to entrepreneurship, investment, and ease of business formation that makes America’s economy so dynamic can also make America vulnerable to bad actors.

For example, drug cartels or international oligarchs might want to set up a fake company or shell company to launder their money or hide their wealth from tax authorities. This BOI Reporting requirement is intended to prevent criminals from misusing the U.S. financial system by setting up fake companies to hide their misdeeds.

What information do small business owners need to provide for BOI Reporting

With Beneficial Owner Information Reporting, the government wants to keep track of who actually “owns” and “benefits” from a particular small business, corporation, LLC, or other legally created business entity.

The BOI Reporting filing system will ask you for a few types of information about your company and about the business’s “beneficial owner,” such as:

Tax ID number (Employer ID Number if your business has one)Legal name of your businessWhere your business was formed, registered, or incorporatedYour business’s addressYour personal name and residential addressA photo of your driver’s license or passport

Which small businesses have to do BOI Reporting

The rules for BOI Reporting are complicated. But in general, if you own a small business that exists as a legal business entity that was formed by filing documents with a Secretary of State or other state-level business incorporation authority, you will probably have to file a BOI report.

These businesses could include LLCs, corporations, and other business entities. Even if you don’t have employees, even if you’re a freelancer or a solo consultant or a solopreneur, even if your business is a side hustle that does not provide your full-time income — if you have an LLC or an Employer ID Number, if you’ve filed a business tax return or opened a business bank account, you probably need to prepare for BOI Reporting.

Some types of businesses are exempt from BOI Reporting. These include nonprofits, certain publicly traded companies, financial services companies like banks and broker-dealers in securities, insurance companies, and accounting firms. But don’t assume that your business is exempt; read the FinCEN website FAQs.

When is the deadline for BOI Reporting

BOI Reporting deadlines depend on when your business was formed:

If your business was created, formed, or incorporated before Jan. 1, 2024, you have some time: you don’t have to file your BOI Report until Jan. 1, 2025.But if you are starting a new business during 2024 (on or after Jan. 1, 2024), get ready: your BOI Report is due within 90 calendar days of your business entity’s formation becoming “official.”

Don’t miss your chance to file your BOI Report. The penalties are serious! As FinCEN describes, business owners that willfully fail to file a complete or updated BOI Report, or provide (or try to provide) false or fraudulent BOI reports, can face civil penalties of up to $500 per day that the violation continues, or up to two years of imprisonment and/or a fine of up to $10,000.

Bottom line: BOI Reporting for the U.S. Treasury is an important new requirement for small businesses in 2024. Don’t delay, don’t ignore it, don’t forget about it — just as you wouldn’t want to forget to file taxes or reply to a jury duty summons. The full list of details is complex and a little confusing; it shouldn’t take long to actually file the BOI Report, but a lot depends on what kind of business you have and how your business entity is structured. Learn more at the FinCEN website.

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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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