Money Management

Costco may be a store that you visit often. But should it be your only source of groceries? Read on to find out. 

Before I had kids, Costco was a store I visited about once a month. But now that I have school-aged children, Costco is a store I shop at pretty much every week. That’s because buying a lot of my grocery staples in bulk allows me to save money.

But while I can’t imagine how much I’d spend on food if it weren’t for Costco, I also know that I can’t make it my sole destination for grocery purchases. And you’re likely to land in the same boat.

Why Costco alone doesn’t cut it

Costco’s bulk prices are often considerably less expensive than those offered at my local supermarket. Case in point: Right now, the cost of five dozen eggs at Costco is $14.03 for same-day delivery, or $0.23 per egg. At the store, the cost is even less, since Costco charges more for same-day delivery items ordered online. So in reality, it’s probably more fair to put the cost at $0.20 per egg or less.

Meanwhile, at my local supermarket, right now, a dozen eggs is $3.29, or more than $0.27 an egg. So clearly, there’s savings to be reaped buying eggs at Costco. And because my family eats a lot of eggs, and I bake often, buying 60 eggs at a time is not a risk for us. We’re likely to go through that many before they go bad.

That said, there are many grocery items my family consumes that we do not need to buy in bulk. And chances are, you’re in the same boat. So for that reason alone, it’s probably not a good idea to plan to do all of your grocery shopping at Costco.

Similarly, while Costco does offer a wide variety of grocery items, I have to admit that the selection at my go-to supermarket is even larger. In fact, there are certain brands my kids prefer that Costco just doesn’t carry — or in some cases, it doesn’t carry the varieties we want.

My family is big on Chobani Greek yogurt, for example, which comes in dozens of flavors. Costco carries this brand, but usually only has a few flavors to choose from. Usually, those aren’t the flavors my kids prefer. And it doesn’t make sense for me to pay less for yogurt that my children won’t eat. In that case, I’m not saving money — I’m wasting it.

Your supermarket might also have a better deal

Another reason not to buy all of your groceries at Costco? Supermarkets tend to put different items on sale on a rotating basis. But in many cases, you’ll pay less at your regular grocery store than at Costco when there’s a sale going on.

For example, Costco has a seven-count of Barilla pasta boxes available for $11.10 online. Again, to be fair, let’s shave a little off of that total because that seven-pack is going to be cheaper at the store. But even if Costco’s price is $8, which would put the per-box cost at $1.14, my supermarket often puts this brand on sale for $0.99 or $1.09. That doesn’t happen every week, but it happens often enough that I can get discounted pasta when I need to.

Buying groceries at Costco often makes financial sense when you have a family to feed. But you probably shouldn’t expect to do all of your grocery shopping at Costco. Doing so might mean wasting money and limiting yourself to a narrower selection of products, not to mention missing out on cheaper prices elsewhere.

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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.Maurie Backman has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Costco Wholesale. The Motley Fool has a disclosure policy.

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It’s important to make the most of your 401(k). Read on for a benefit your employer’s plan might offer. 

Saving money for retirement is essential. If you don’t manage to accumulate a decent nest egg, you might struggle financially once your career comes to an end and you’re no longer collecting a paycheck. If your employer offers a 401(k) plan, it pays to sign up for it.

One major benefit to participating in an employer-sponsored 401(k) is that contributions are made directly from your paychecks. So you don’t have to worry about sending money into your retirement account every month.

Plus, many employers that offer 401(k)s also match worker contributions to some degree. So if you put, say, $2,000 into your 401(k) this year, that may result in an additional $2,000 from your employer. You can contact your HR department to find out more about your company’s specific plan.

Meanwhile, some 401(k) plans offer a Roth savings feature. If yours does, it pays to take advantage, especially since the rules for these plans are changing for the better this year.

The upside of a Roth 401(k)

With a traditional 401(k) or IRA, contributions are often tax free, which means you can shield some income from taxes the year you fund your account. For example, if you put $2,000 into either a traditional 401(k) or IRA this year, the IRS won’t tax you on $2,000 of your salary (as long as you’re below the income limits set by the IRS). Plus, investment gains in a traditional 401(k) and IRA are tax deferred, which means you don’t pay taxes until you take withdrawals.

Roth accounts work differently. With a Roth 401(k) or IRA, you do not get a tax break on the money you put in. However, investment gains in these accounts are tax free, not just tax deferred — meaning, you pay no taxes on those gains, ever. Plus, withdrawals from a Roth are tax free, which means you won’t have to worry about the IRS taking a chunk of your income in retirement.

A positive retirement account change for 2024

It used to be that Roth IRAs were the only tax-advantaged retirement account to not impose required minimum distributions, or RMDs. RMDs basically force you to spend down your retirement account balance in your lifetime.

The IRS imposes these because it doesn’t want IRAs and 401(k)s to become vehicles used by the wealthy to pass down inheritances in a tax-advantaged manner. Rather, it wants these plans to serve their intended purpose — providing seniors with retirement income.

Starting this year, however, Roth 401(k)s are joining Roth IRAs in not imposing RMDs. With a Roth 401(k), you’ll get more control over your money. You can leave your savings alone in retirement for a period if you don’t need to take withdrawals right away, which will allow your money to remain invested and potentially grow even more.

Now, not every 401(k) plan offers a Roth version. But if yours does, you may want to consider signing up.

And if your employer’s retirement plan doesn’t come with a Roth feature, it wouldn’t hurt to ask for one now that the rules have changed for the better. Your employer may be willing to implement that change if enough people request it.

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Make sure you set yourself up for success to reach your goals in 2024. Mobile apps can make it easier and more fun. Find out how. 

Now that a brand new year is ahead, you may be working hard to meet big financial goals. As you take steps to reach your goals, don’t neglect technology that can help you be more successful. Mobile apps can help you save time, feel more motivated, and stay on track. Here are a few ways to use mobile apps to reach your 2024 financial goals.

1. Track your progress

The Motley Fool Ascent’s 2023 Financial New Year’s Resolutions survey discovered that the most common financial resolution for 2024 was to pay off debt. Tracking your progress can help you stay motivated while tackling debt this year. If you’re tech-savvy, you may want to consider using one of the best debt payoff apps to track your progress. Apps like this can make it easier to visualize how much closer you are to achieving your debt payoff goal.

2. Put your savings strategy on autopilot

If you have lofty savings goals for 2024 but are worried about being forgetful, you may want to automate the savings process. You can use your bank’s mobile app to set up automatic transfers so money is regularly transferred from your checking account to your savings account.

Doing this can save time and ensure you don’t fall behind on your contributions. Putting my savings strategy on autopilot has been a game-changer for my high-yield savings account balance. I feel more confident knowing I’m on target even when life gets busy.

3. Get credit card spending alerts to avoid overspending

If you use credit cards, the apps provided by your credit card issuers can also help you stay on track with your financial goals in 2024. If you’re working hard to reduce your spending, you can set up account alerts to hold yourself accountable.

For example, you can enable spending alerts to receive an alert when your monthly spending reaches a specific spending limit that you set. Free alerts like this can help you avoid overspending beyond your means so you don’t rack up expensive credit card debt.

4. Monitor (and learn how to change) your spending habits

For many people, overspending is an issue that keeps them from reaching their financial goals sooner. But learning more about and then altering your spending habits can do wonders and free up more money for your goals. Using one of the best budgeting apps can make it easier to see where your money is going so you can make positive changes.

5. Avoid missed or late credit card payments

If one of your goals is to boost your credit score in 2024, you’ll want to do what you can to avoid late payments. Forgetting to pay a bill can cause stress and could impact your credit score. Your payment history makes up 35% of your FICO® Score.

But there’s another reason you should pay all your bills on time, especially credit card bills: late fees. Most credit card issuers charge credit card late fees if you don’t pay your bill on time. Any unnecessary fee you pay like this impacts your bank account balance.

You can use your credit card issuer’s mobile app to stay on top of your bills. You can set up payment reminder alerts to receive an email notification of an upcoming bill due date. This way, you don’t miss a payment or accidentally pay your bill late.

Use technology for greater success

Mobile apps like the ones mentioned above can make your life easier. They can also give you greater control over your finances so you can reach your goals sooner. Check out our personal finance resources for additional tips as you navigate your 2024 financial goals.

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

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Car expenses have soared recently. Here’s what to do if you’re underwater on your loan. 

Car prices spiked over the past few years, reaching an average transaction price of $48,247 in November. That amount is a nearly 23% increase from the average cost just three years ago, according to Kelley Blue Book.

Several factors contributed to soaring car values, including labor shortage, supply chain constraints from the pandemic, a semiconductor shortage, and stimulus checks that fueled buying.

But the car market has begun to shift in the opposite direction now. Car values are cooling down, and the auto market is returning to normal.

And while that’s good news for Americans looking to buy a car this year, it’s potentially bad news for people who paid top dollar for some vehicles over the past few years. The latest data from Edmunds shows that borrowers who are underwater on their car loan — meaning they owe more money than the car is worth — have an average negative equity of $6,054.

That’s the highest amount of negative equity in the past three years, and it comes when borrowers are increasingly having difficulty affording their auto loans. Delinquency rates for subprime loans of 60 or more days past due were 6% in September and October.

All of this means that if you’re having difficulty making payments on your car loan right now, you’re not alone.

How to reduce your car expenses

Even if you’re not underwater on your auto loan, expensive car payments can eat into your personal finances. Here are a few steps you can take to improve your situation:

Look at your budget

If your car loan is too expensive, you may need to find some additional money to help cover the cost. That may mean cutting out other monthly expenses you don’t need. Streaming services, eating out, and shopping may be good places to consider cutting first.

Shop for cheaper car insurance

Insurance prices have surged over the past few years. While you can’t forgo coverage altogether, you may be able to find a different car insurance company that could offer you lower rates. Take some time to look at other rate quotes, adjust your deductible to see how it affects your premium, and talk to your insurer about different coverage options to see how it might impact your auto insurance costs.

Refinance your loan

While this option will likely involve some fees, it’s possible that refinancing your auto loan could end up saving you money. This might be a good option if your credit score has improved since you got the original loan.

Make extra payments

If you have the money in your budget, you may benefit from paying off your auto loan early, especially if you’re underwater. Aim to make at least one additional payment per year, or more if possible. You can do this by increasing your monthly payment so the additional amount you pay equals one full payment by the end of the year.

One quick way to get your finances back on track

Sometimes, it’s worth cutting your losses. If you’re having a hard time paying for your monthly car payment and won’t be able to pay off the car for many more years, it may be best to sell it or trade it in and get something cheaper.

You may lose some money on the sale, but if you’re going to be financially stressed for many more years to come because of the high car payment, it may be worth selling the car as soon as possible.

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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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Period care products can be costly, and some states still impose taxes — making them more expensive. Find out how you can pay less for period care items. 

As everyday living costs climb, a simple trip to the store can quickly become more expensive than planned. Many people need to buy essential items like period care products, which aren’t always affordable. Additionally, many states still charge taxes when consumers buy period products, which makes them even more costly. If your bank account is hurting and you’re looking for ways to save on period care products, here are a few tips.

1. Buy in bulk

Buying in bulk can be a win for your wallet if you can cover the upfront cost of a larger package of pads or tampons. Warehouse clubs like Costco and Sam’s Club sell period care essentials in bulk. But you’ll have to pay for a membership to shop there. However, you can also buy larger packages of products like tampons and pads online and at popular retailers like Target. You’ll get a better per-item price by doing this and be stocked up, so you won’t have to worry about running out of supplies anytime soon.

2. Give store-brand products a try

If you’re not set on a particular brand of products and want to reduce your spending, you may want to consider switching to only buying generic period care products. At most retailers, store-brand items are a fraction of the cost of name-brand ones. If you don’t notice much difference between store brand and name brand, there’s little reason to keep paying extra. The savings can add up quickly if you commit to this practice regularly.

3. Don’t ignore sales and other discount opportunities

When shopping for period care products, keep an eye out for sales to lower your credit card bill. Buying your favorite essentials when they’re on sale is a smart savings strategy — and if you can buy extra at a lower cost, a sale is a good time to stock up.

It can also be beneficial to look for other ways to get a discount, like clipping virtual coupons through your grocery store’s mobile app to get a better deal at checkout. Every cent you save adds up and makes a difference, so be strategic as you shop.

4. Switch to reusable period care products

If you’re willing to make a lifestyle change, you can save a significant amount of money by investing in reusable period products. Period underwear, cloth pads, and menstrual cups are some options to consider. You’ll need to spend more upfront to buy these items, but you can keep more money in your pocket over time because you won’t be purchasing disposable products every month. If you have a health savings account (HSA), you can even use these funds to pay for reusable products. Plus, you can do your part to reduce waste.

You may qualify for reimbursement for the period taxes you pay

If you live in one of the 21 states that still impose taxes on menstrual products, you may be feeling additional financial strain. But you may be able to get some money back the next time you stock up on period supplies.

The Tampon Tax Back Coalition offers reimbursement on taxes paid when buying period care products from select brands at retail stores. Reimbursement is available when buying products from the following brands: August, Cora, DIVA, Here We Flo, The Honey Pot, LOLA, Saalt, and Rael. Visit Tampontaxback.com and file a claim within 10 days of purchase to start the reimbursement process.

By taking advantage of the above tips, you can waste less money when buying menstrual products. You’re not alone if you’re looking for ways to save on all your everyday expenses. Check out our free personal finance resources for more tips.

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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 Costco Wholesale and Target. The Motley Fool has a disclosure policy.

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Costco sells kits to build your own tiny house, but they’re not complete bundles. Find out what you need to complete your new home and what it’ll cost. 

It’s that time of year again — time for us to set our goals for the next 12 months, and with any luck, crush them. For a lot of people, it’ll be the old standards: going to the gym more, learning a foreign language, or finding true love. For others, those goals may be more financially focused, like buying a house.

But, with housing prices where they are, going the traditional home-buying route might be a touch out of your price range — and maybe you’re considering a tiny house. The good news is that Costco is now offering site-built tiny homes through its Studio Shed line, so if you know someone who would let you plant a little house on their prairie, read on.

What does a Costco tiny home cost?

The Studio Shed line comes in three different models, including the Pagoda, the Boreas, and the Solitude (these are very serious-sounding names if you ask me). Each model can be built as an 8-foot-by-10-foot, 8-foot-by-12-foot, or 10-foot-by-12-foot unit, and are priced accordingly.

The smallest units start at $12,499.99 for the base model, Pagoda, and go up to $13,999.99 for the highest end unit, the Solitude. The largest units are $13,999.99 and $15,999.99, respectively. That sounds like an amazing bargain, especially considering it would take roughly $400,000 to buy a median-priced house in America these days.

Well, there’s a catch to all of this. Costco tiny homes are site-built, but they only include the walls, ceiling, floor, windows, siding, and roof. Unfortunately, there’s a ton more that goes into a house — even a tiny one.

What do you need for your Costco tiny home?

You’re going to need a bunch more stuff for your Costco tiny home, and in many municipalities, a licensed professional to install it. Here’s a short list of must-haves to get you started, whether you need a personal loan or will be paying out of pocket.

Building permit

If you have to have a building permit to install your tiny home, that can average about $1,350 nationally. This is important to not skip, if you build something that requires a building permit without one, your municipality can literally tear your building down.

Plumbing

Rough-in plumbing, or the part of the plumbing that doesn’t include the fixtures like sinks and toilets, generally has to be completed by a licensed plumber. For a tiny home, you only really need a water heater, toilet, sink, and shower, though you may want to add more items, like a separate bathroom sink or washing machine hookup. Roughing in a sink, for example, costs $350 to 500 on average, and a water heater $400 to $1,800. A full bathroom rough-in can cost anywhere from $1,600 to $2,900. There’s also going to be a cost to hook your tiny house up to the municipal water and sewer systems.

Electrical

Your tiny house needs power, unless you prefer to live in the dark. This will mean multiple outlets, light fixtures, and power to run your tiny water heater and appliances like a cooktop or washing machine, as well as a breaker box to ensure that it won’t burn down if a circuit gets overloaded. You’ll also need a professional installation, since electrical work always requires a permit. You’re looking at somewhere between $1,500 and $2,500 for this work, though it will very much depend on the configuration of your Costco tiny home.

HVAC

You’re going to want some kind of climate control in your tiny home, and the best bang for your buck is likely to be a single ductless mini split system. Although you can DIY these units, a professional installation will cost you somewhere between $2,000 and $6,000 for a single zone unit, which is more than enough for a small space.

Drywall

Here’s one you can DIY in almost every location! Depending on the type of drywall you choose to use, you’re looking at anywhere from $10 to $20 per 4-foot-by-8-foot panel, plus the cost of tape and mud, which is relatively minimal by comparison.

Lighting

Once the electrician has set the breaker box and runs the wires for your lights, you can install the lighting yourself. The cost of lighting varies widely, depending on what you want, and you can easily do a few fixtures for under $100 or spend $1,000 if you have some really specific tastes.

Kitchen cabinets and counters

This is another place where your costs depend on the materials you choose. And you can do it without a permit or a professional, if you’re feeling brave. If you choose to upcycle or recycle old cabinets and counters, you’ll find this cost is just a few hundred dollars, but if you want new, be prepared to break the $1,000 mark very quickly.

Bathroom cabinets and appliances

The same rules for the kitchen apply to the bathroom. If your plumber has done the rough-in, you only need to install your cabinet, sink, and other appliances, like a toilet or shower (or toilet/shower combo). Often these items can be salvaged from other remodelers doing upgrades, if you’re not too picky, saving you money.

Of course, this is only the beginning, since a tiny home must be personalized to maximize efficiency, but it’ll give you some idea what it really costs to buy and finish a Costco tiny home, if a home of your own happens to be one of your 2024 resolutions. If you’re doing this on your own land, you may even qualify for a new construction home mortgage. Be sure to ask your banker before you get started.

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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.Kristi Waterworth has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Costco Wholesale. The Motley Fool has a disclosure policy.

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