Money Management

Sometimes, it makes sense to pay a fee to have groceries brought to your door. Read on to see why. 

Before the COVID-19 pandemic, having my groceries delivered wasn’t something I ever thought to do. After all, I have a car, I work from home with flexible hours, and I have several large supermarkets within a 10-minute radius of my house. Why would I pay someone to do my food shopping for me and spend extra money in the process?

But like many people, during the pandemic, I changed my tune about grocery delivery. Back then, I was more than happy to throw extra money at the problem if it meant not having to hit the store and get exposed to a virus that was spooking the heck out of society.

At this point, grocery delivery is something I pay for only on rare occasions. But if there’s a week when I’m super busy or the weather is so downright disgusting that I can’t bear to leave the house, I’ll sometimes place a grocery order through a local supermarket.

Usually, between the delivery fee and tip (which is not required, but I always tip someone who’s bringing food to my door), I end up spending about an extra $20 per order compared to the cost of shopping for my food myself. But here’s why that extra $20 is worth it.

1. It frees up time

As a freelance writer, the more time I spend at my desk writing, the more money I can earn. Ordering groceries online might take me 15 minutes or less. But if it’s a larger haul, I might spend an hour or more at the supermarket.

As such, I can easily justify the cost of grocery delivery because if it saves me an hour, I can often make well more than $20 in that amount of time. So all told, I’m actually coming out ahead financially.

2. It prevents impulse purchases on my part

Even though I’m someone who likes to get in and out quickly when I’m shopping for food, I can fully admit that going to the store tends to lead me to buy extra things. Sometimes, it’s a box of donuts. Other times, it’s a bag of chips.

Most often, the items I buy on a whim at the supermarket are of the snack variety, and they’re not very healthy. Plus, the cost of all of those items can add up.

When I order groceries to be delivered, I don’t have to worry about impulse buys because I’m not walking down supermarket aisles and seeing products that appeal to me. Rather, I’m entering products into a search bar and adding them to a cart.

Now, I can admit that the bulk of the money I save in the context of grocery delivery comes in the form of more time to work, since my impulse purchases usually don’t amount to $20 per shopping trip. Rather, I might spend $3 here or $5 there at a regular supermarket. (Costco, my friends, is a different story.) But still, that’s an added perk.

Is grocery delivery worth it for you?

If you’re someone who works on a freelance basis, then you may find that outsourcing different tasks, whether it’s buying groceries or mowing your lawn, ends up benefiting you financially by making it possible to earn more. Before you tell yourself you won’t pay extra for a given service, think about what that extra time might do for your bottom line.

Even if you aren’t a freelance employee, there’s something to be said for paying for conveniences so you can free up time. Maybe you’re a salaried employee with a demanding job that results in a good salary. In that case, there’s nothing wrong with spending some of your hard-earned money to free up time during your evenings and weekends so you don’t have to run errands or do maintenance around the house.

It’s easy to look at grocery delivery as a waste of money. But if you can afford it and it benefits you, then it may not be a waste at all.

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.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.

 Read More 

The average new EV costs more than $59,000. Hybrids are cheaper and don’t come with range anxiety. Here’s why else they might be a better choice for you. 

A car is one of the largest expenses many Americans have. And over the past few years, the price of a new vehicle has rapidly risen along with car repair costs, insurance, and nearly everything else.

There are many reasons for price increases, including manufacturing disruptions during the pandemic, a lack of available workers, supply chain shortages, rising demand, and inflation.

And while many Americans are open to buying an EV — 55% according to Gallup — many people opt to buy a hybrid vehicle instead. While car buyers want more energy-efficient vehicles, they also want them to be less expensive than EVs.

Why people are choosing hybrids over EVs

The latest data from Edmunds shows that Americans bought more than 1.2 million hybrids in 2023, an increase of 76% from the year before.

Hybrids are having their day in the sun thanks to their combination of energy efficiency and practicality.

First, they’re cheaper than many electric vehicles on the market, considering the average price of an EV in 2023 was $59,400 compared to $42,381 for a hybrid, according to Edmunds.

They’re also much more practical for many car buyers because they don’t rely solely on electricity. Public chargers aren’t ubiquitous in the U.S. yet, and even if you have access to fast-charging stations — which are even less common — getting a battery to 80% can still take between 20 minutes to an hour, that’s far longer than filling a hybrid with gas.

Finally, there’s no range anxiety with a hybrid vehicle. When you run out of battery power or reach a certain speed, the gas-powered engine kicks in. That alone is enough reason for many car buyers to choose a hybrid over an electric vehicle.

One way buyers won’t save money with a hybrid

While many car buyers could save money by opting for a hybrid over an all-electric vehicle, one expense will likely be costly no matter which they choose: car insurance.

Because hybrid vehicles have many of the same components as electric vehicles, like electric motors and batteries, the cost to repair them may be more than gas-powered vehicles. Progressive says costly battery packs and the lack of technicians who know how to work on the electric vehicle systems can make EV and hybrid insurance costs higher.

And in some cases, hybrid auto insurance may actually cost more than EV insurance. Consumer Reports found that insuring the Toyota Prius, a hybrid vehicle, costs $1,905 annually, $35 more than insurance for the all-electric Nissan Leaf.

That makes it all the more important for hybrid and EV owners to compare car insurance companies and shop around for plans.

How to save up to $7,500 on a new hybrid

The good news for potential hybrid car buyers is that the U.S. government has made it easier to get a $7,500 tax credit — or $3,750, depending on the model — for certain electric and hybrid vehicles this year.

Last year, buyers had to claim the credit when they filed their taxes (which was more complicated), but this year, the credit can be applied immediately at the dealership when buying a qualifying vehicle. You can see which vehicles receive the tax credit on the U.S. Energy Department website.

With many EVs out of range (pun intended!) for many people’s personal finances, a hybrid vehicle may be the right balance between energy efficiency and cost. And with the latest government incentives, now could be a great time to find one.

Our best car insurance companies for 2024

Ready to shop for car insurance? Whether you’re focused on price, claims handling, or customer service, we’ve researched insurers nationwide to provide our best-in-class picks for car insurance coverage. Read our free expert review today to get started.

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.Chris Neiger has no position in any of the stocks mentioned. The Motley Fool recommends Progressive. The Motley Fool has a disclosure policy.

 Read More 

Learning your way around a new health insurance policy can take time. Read on for some key points to check off sooner rather than later. 

Health insurance is one of those things that might change from one year to the next, whether because you get a new job or you buy a new plan on your own that isn’t sponsored by an employer. If you have a new health insurance policy this year, you need to understand its ins and outs. Here are a few key items to check early in 2024.

1. Your deductible

Your health insurance deductible is the amount of money you’ll need to pay before your insurer starts picking up the tab for your service. If that amount is $800, it means that if you end up needing to see a specialist that costs $650, you’ll generally have to fork over that $650 if you haven’t met your deductible yet. Knowing that number is important because you should always aim to have enough money in your savings account to cover your deductible in full.

2. Whether referrals are needed

Some health insurance policies require you to get a referral from a primary care provider before you’re allowed to see a specialist. Failing to obtain that referral could mean having your insurer deny a claim for treatment, so it’s important to find out how your policy works.

In some cases, you may have to visit your primary care doctor before getting a referral. However, if you’re up to date on your well visits, they may be willing to give you a referral without making you come in.

3. Which providers are in-network

Seeing an out-of-network provider could cost you a lot more money than seeing an in-network provider. Before you start scheduling medical appointments, find out whether the doctors you already go to are in-network with your insurer. If not, you may want to start asking for recommendations so you can stay in-network and keep your costs down.

4. What your insurer’s preferred lab is

Insurers often contract with different labs to provide diagnostic services. It pays to find out what your insurer’s preferred lab is. Going to a different lab could result in higher bills for you.

Information like this is generally available if you log into your account online. But if you’re confused, just call and ask to speak to a live person to get the right details.

5. Whether your plan is HSA-eligible

A health savings account (HSA) is a special account that lets you contribute money on a pre-tax basis to pay for medical expenses. Unlike FSAs (flexible spending accounts), HSAs do not require you to spend down your plan balance every year. Rather, you can invest the funds you don’t need right away and grow your balance.

To qualify for an HSA, your health plan needs to meet certain criteria that can change from one year to the next. This year, your plan is HSA-eligible if it has a minimum deductible of $1,600 for self-only coverage or $3,200 for family coverage. Your plan also has to have an out-of-pocket maximum of $8,050 or less for self-only coverage or $16,100 or less for family coverage.

Learning how your health insurance works could spare you a financial mess. Take the time to get your policy’s details straight if you’re a new enrollee.

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 

Financial planning can help you reach your money goals. Find out about a serious and all-too-common financial planning mistake so you know what to avoid. 

It’s stressful when you don’t feel financially organized or prepared for the future. Financial planning is the solution to this, but it’s becoming a lost art. Americans are spending less time on financial planning, according to research by The Motley Fool Ascent.

To make it even worse, over half of Americans don’t engage in financial planning regularly. Just 46% do so, while 30% said they only make financial plans before a large purchase or investment. And 24% go with “crisis budgeting,” which is financial planning only when dealing with an unexpected expense or a loss of income.

If you’re in the group that doesn’t regularly make financial plans, it’s worth changing that. This is one habit that can make a big positive impact for you.

Why financial planning is important

A financial plan is essentially a roadmap for managing your money. It includes your short- and long-term goals, as well as how you’ll use the money you earn.

There are a lot of common reasons people have for not doing this. It sounds complicated, or they don’t have the time, or they don’t think that they have enough money for a financial plan to be worth it.

But financial planning doesn’t need to be complicated or time-consuming, and it can benefit you no matter how much money you have. Here are a few ways it has been shown to help with personal finances, based on data from Schwab’s 2021 Modern Wealth Survey:

65% of financial planners have a three-month emergency fund, compared to 33% of non-planners.47% of financial planners never carry a credit card balance, compared to 29% of non-planners.65% of financial planners feel financially stable, compared to 40% of non-planners.71% of financial planners are aware of investment fees and costs, compared to 45% of non-planners.

These are all good signs, and they’re much more common among people who plan out their finances. When you don’t have a plan, it’s much harder to reach your money goals and build for the future.

How to start financial planning

The first time you make a financial plan, it could take a little while. You might want to set aside an afternoon. It gets quicker and easier after that, because you aren’t starting from scratch anymore. Here are the steps to follow for successful financial planning.

Review your current financial situation. By seeing what your finances look like right now, you can figure out where you want to improve. Make a list with all of the following numbers:

Your incomeMonthly bills, divided into essential and non-essential spendingAny debts you have and their interest ratesBank account balancesInvestment and retirement account balances

Set your money goals. Think about what you want to achieve financially in the future. This is different for everyone, and it also depends on your current situation. If you’re carrying balances on credit cards, then you should focus on paying off credit card debt. If you don’t have any pressing debts, saving for retirement is always a smart goal, and you may also want to save for a down payment on a home if buying one is important to you.

Aim to have a mix of short- and long-term goals. For example, short-term goals could be saving for a vacation next summer, building a three-month emergency fund in the next two years, or shaving $300 per month off your bills. Long-term goals could include reaching a certain amount in retirement savings and in college funds for your kids, to give a few examples.

Decide exactly where your income will go. Now you’ll figure out how you’re going to spend your money. Here’s an example of how you could divide up your income:

50% for paying essential bills20% for paying off debt10% for investing in your retirement accounts10% for your savings account10% for fun money, spent anyway you want

Your spending plan will depend on your income, your bills, and the goals you want to accomplish. What’s important is being purposeful about how you spend your money so it doesn’t get wasted.

Check your progress monthly. You don’t need to spend a ton of time on financial planning. Once you have your plan, just do a monthly check-in to make sure it’s working and see if there are any changes you’d like to make. As your finances change, you’ll also need to adjust your plan with them. You may decide to invest more after you get rid of debt, or temporarily save less if you’re dealing with a loss of income.

Financial planning can feel intimidating before you get started. But you’ll likely find that you feel better about money after you do it, and especially when you see how you’re progressing toward your financial goals.

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.Charles Schwab is an advertising partner of The Ascent, a Motley Fool company. Lyle Daly has no position in any of the stocks mentioned. The Motley Fool recommends Charles Schwab and recommends the following options: short March 2024 $65 puts on Charles Schwab. The Motley Fool has a disclosure policy.

 Read More 

Thinking of buying a car this year? Read on to see why that may not be the best idea. 

If you have a number of lofty goals set for 2024, you’re probably in good company. Many people make personal finance resolutions at the start of a new year, and one of yours might be to replace your old clunker of a car with a newer model.

It’s easy to see why you’d want to upgrade your car, especially if you drive often. But here’s why you may want to avoid buying a car this year.

1. Borrowing is still expensive

To combat inflation, the Federal Reserve hiked interest rates numerous times in 2022 and 2023. The good news on the borrowing front is that the Fed opted to pause its rate hikes at its last three meetings. And it’s even projecting possible rate cuts in 2024.

But still, the cost of borrowing money remains elevated, whether you’re looking at an auto loan, a personal loan, or a home equity loan. So if you’re in a position where you need to finance a vehicle, you might get stuck with a higher interest rate than what you want — even if you have an excellent credit score.

2. Car prices are still up

Car prices fell in 2023 for the most part. That’s the good news. But still, as of October, the average price of a new vehicle was $47,936, says Kelley Blue Book. That’s not exactly a small amount of money.

That said, you don’t necessarily have to buy a car that costs almost $48,000. You might reap some savings on a vehicle if you stick to a used model, or if you buy a newer model but forgo some higher-end features. But still, cars aren’t cheap to buy these days, so know that you may end up spending more than you’d like to.

3. Your current vehicle runs well enough and you have other goals you’re saving for

If your current vehicle is so old or has so many problems that it’s become unreliable, then it makes sense to buy a new one this year if you can afford to. You might end up compromising your job if you keep showing up late due to your car not starting. And you can’t afford to be stranded in your driveway when it’s time to pick your kids up from school.

But if your current vehicle runs well enough and you’re confident you can get another year out of it, then it pays to wait on a new car purchase if you have other pressing goals you’re saving for. Those might include building an emergency fund or replacing your home’s air conditioning system that may not make it through the summer.

A new car could make your daily commute more pleasant. And let’s just be honest and say that it’s nice to have new things in general, whether it’s a car, a TV, or a handbag. So if you have some money socked away in your savings account for a car down payment, you may be tempted to move forward with your plans to buy in 2024. But before you do, consider the drawbacks of buying a car this year, and consider postponing that purchase for another 12 months if doing so is feasible.

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 

The Fed has been less aggressive with interest rate hikes in recent months. Read on to see what’s in store for the coming year. 

Inflation has been a nagging problem for U.S. consumers for the past couple of years — one that’s managed to wreak havoc on a lot of people’s personal finances. And the Federal Reserve has made it clear that it’s not going to allow inflation to remain stubbornly high.

In early 2022, the Fed started implementing interest rate hikes in an effort to slow inflation down. And thankfully, the central bank’s efforts have paid off.

In November, the Consumer Price Index measured annual inflation at 3.1%, which is pretty close to the Fed’s 2% target. That’s the most recent measure we have to work with as of this writing. However, inflation started to cool well before November — so much so that the Fed was able to leave interest rates steady at its last three meetings.

But is the Fed really done raising interest rates? Or are more rate hikes in store for 2024?

There’s a good chance the Fed is done

The Fed definitely wants to bring inflation as close to the 2% mark as possible. But one thing the Fed does not want to do is cause a recession. The central bank is very aware that additional rate hikes have the potential to do just that.

As such, as long as inflation continues to cool or hold steady, there’s a good chance the Fed will let things be and leave interest rates where they are to start 2024. What’s more, if inflation continues to improve, we could see rate cuts at some point this year, thereby making borrowing less expensive.

Prepare for another rate hike, just in case

Some financial experts are convinced that the Fed is done with interest rate hikes. But it’s important not to get too confident.

At its last meeting, the Fed released a statement that said, “The Committee remains highly attentive to inflation risks.” It also said, “The Committee would be prepared to adjust the stance of monetary policy as appropriate if risks emerge that could impede the attainment of the Committee’s goals.”

If the Fed has reason to believe that inflation won’t continue to trend toward the 2% mark in 2024, it won’t hesitate to raise interest rates again if it deems that necessary. So consumers should remain vigilant — especially those with variable-interest debt, such as credit card and HELOC balances.

In fact, if you owe money on a credit card or HELOC, your best bet is really to try to pay off your balance as soon as possible. You never know when the interest rate on that debt might rise. And the sooner you can put that debt behind you, the better your financial picture is apt to be.

Meanwhile, if you’re looking to borrow money in 2024, whether to finance a home purchase or buy a car, pay attention to what the Fed does as far as interest rates go. If the central bank announces any sort of rate cut, that might be a good time to move on a loan application.

But also, take steps now to improve your credit score so you’ll hopefully be in a great position to borrow once that becomes more affordable. You can boost your credit score by paying all bills on time and correcting errors on your credit report (which you can access for free weekly from AnnualCreditReport.com). Whittling down an existing credit card balance should also help your credit score improve.

All told, it’s too soon to declare that the Fed is done raising interest rates. But there’s a good chance we won’t see any rate hikes in 2024, and that’s a good thing for anyone who’s interested in borrowing money.

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