Money Management

Getting a dog can be more expensive than you think. Here’s how much you can expect to pay and how to prepare for it. 

Getting a pet for Christmas can be really exciting. Who doesn’t love a new furry friend? But, when you bring an animal into your home, it’s important to make a financial plan for your pet’s care.

You’ll hopefully have your new family member with you for many years to come, so you need to consider the long-term costs of taking care of your new loved one. How much will that new cuddly Christmas present cost you? Here’s what you need to know.

This is how much dog care costs

Dogs can cost a good amount of money when they first come home with you since there’s a lot of vet care they need as puppies. Plus, you’ll need to get your house outfitted with the stuff that will make your new furry friend feel at home — especially if it’s your first dog.

Rover.com estimates that first-time dog expenses range from $1,135 to $5,155. This includes things like adoption fees, an initial vet exam, a crate and bed, toys, treats, a license, and basic pet care.

Once you’ve paid these big upfront costs, the expenses don’t stop either — although they are usually lower in subsequent years. Rover.com’s estimates for annual expenses range between $610 and $3,555, with most of that variation coming from how much you spend on your animal’s food. The approximate costs of food could be as low as $300 or as high as $2,340, depending on what your dog eats and how much of it.

There may be other unexpected costs as well, including emergency vet bills if your animal gets sick or hurt, as well as training expenses if you decide you need some professional help to assist your pet in being a good companion.

As your dog gets older, you’re also likely to face more expenses, including more vet visits and perhaps special food for a senior animal.

How to make sure you can provide for your animal companion

As you can see, the total cost of pet ownership is likely to add up to thousands of dollars, with the specifics depending on how long your dog lives, what kinds of supplies you buy, the food they eat, and how healthy your animal is.

If you’ve adopted a pet, you need to be prepared to cover these big expenses. Buying pet insurance can help cover large vet bills that result from illness or injury. But, pet insurance usually doesn’t cover wellness care or other non-veterinary expenses like crates and food, so you’ll also need a savings account earmarked for your animal.

When I adopted my dog, I started putting money aside every month for her care, and I’m still doing that 17 years later. Once your dog is in your home, make a list of the expenses you’ll need to pay each month — including pet insurance — as well as any irregular expenses, like an annual exam. Figure out how much to save each month to cover all of those costs, and work that into your budget so you’ll know you have the funds to be a good provider for your new family member even after the initial holiday gift excitement has worn off.

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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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Shopping for an EV in 2024? EV prices are getting more competitive with gas-powered cars. See how much you can save on EV ownership costs. 

Electric vehicles are the future of the car industry. But not everyone is ready to buy an EV. Many people suffer from “range anxiety,” have concerns about how to find EV charging stations, and are unsure of the personal finance fundamentals of how much money they can save by buying an EV.

Because of recent federal tax credits that pay up to $7,500 toward the purchase of a new electric vehicle, many people might be shopping for EVs in 2024. But before you buy an EV, make sure you understand the big picture. EVs can save you money in some ways (gas, maintenance), but they might be more expensive in other ways (cost of car insurance).

Let’s do a quick financial breakdown of how much money you can save by switching to an electric vehicle.

Electric vehicle savings: Spend $0 on gas

The biggest savings you can get from an electric vehicle is the most obvious: EVs don’t use gas, so your monthly gasoline budget just became $0. However, that doesn’t mean EVs are “free” to drive. You still need to pay for the costs of electricity to power your EV.

Based on research cited by Chase Auto, EV “fuel” costs are about half that for a conventional gas-powered car. And research from The Ascent found that Americans’ average annual spending on gasoline is about $2,148. So if you take 50% of that number, you can expect buying an EV to save you $1,074 compared to what you used to spend on gas.

EV savings on gas: $1,074 per year

Electric vehicle savings: Spend less money on maintenance

Along with gas, another big source of savings when buying an EV is routine maintenance. That’s right: EVs don’t need oil changes, transmission servicing, cooling system flushes, or many other types of maintenance that an internal combustion engine requires. EV engines are simpler, with fewer moving parts.

This doesn’t mean that EVs are 100% maintenance free. You’ll need to be prepared to replace the tires more frequently, and get the tires rotated more often. And in case you get in a crash, EV repairs tend to be more expensive than fixing up a gas-powered car.

However, according to Chase Auto’s research source, your EV’s “lower-maintenance” needs will likely save you around $3,000 during the first five years of driving the car, or $600 annually.

EV savings on maintenance: $600 per year

Electric vehicle extra costs: Car insurance

Along with gas and maintenance, one of the major ongoing expenses of owning a car is car insurance. Especially after car insurance prices surged in 2023, many people might be worried about how much it costs to insure an EV.

Car insurance prices depend on a wide range of factors, from where you live to how old your car is, to how much your vehicle is worth. It tends to be more expensive to insure cars that are worth more money, or that require more costly repairs. For both of these reasons, car insurance for EVs is often going to be more expensive than a comparable gas-powered vehicle.

First, EVs tend to cost more than gas-powered cars. According to Kelley Blue Book, as of July 2023, the average sale price of an EV was $53,469, compared to $48,334 for gas-powered cars. That’s a price difference of $5,135, or 10.6% higher. When EVs are priced like luxury vehicles, their car insurance costs will be pricier, too.

Another reason for higher-priced EV car insurance is that the cars are more expensive to repair in case of a crash. According to USAA, electric vehicle batteries can cost $5,000-$15,000 to repair or replace. A seemingly minor-looking accident that damages the EV battery can rack up huge repair costs, or even get your vehicle totaled.

Want to save money on EV car insurance? Consider getting a smaller, more affordable model of EV, like the Chevrolet Bolt, which starts at $26,500. And get price quotes from the best car insurance companies upfront, before you start shopping for an EV.

There’s no easy way to estimate how much EV car insurance will cost. It depends on lots of different factors, including which car you buy. But for the purpose of this article, let’s assume that EV car insurance will have an additional cost that’s in line with the additional (10.6%) average cost of the car:

Average annual car insurance premium: $3,017Average additional cost of EV (based on sale price): 10.6%Estimated extra EV car insurance premium: $3,017 x 0.106 = $319.80

Extra estimated EV car insurance costs: $320 per year

Electric vehicle rebates, fees, and taxes

Along with gas, car insurance, maintenance and repairs, there are a few extra “wild card” factors that affect how much you can save with an electric vehicle. Many states offer rebates or tax credits to EV buyers (in addition to the federal EV tax credit), and some local utilities give cash incentives and rebates to people who install EV chargers at home. However, some states also charge an extra vehicle registration tax or road use fee to EV buyers.

We’re not going to include estimated rebate numbers here, because it all depends on where you live. Many state rebate programs also depend on which EV you buy, your household income, and other factors. To learn more, check out our guide to EV tax credits, rebates, and incentives.

Bottom line: Based on our estimates, you can save about $1,354 per year by buying an EV. EV prices are expected to get more competitive in the future, with more models coming onto the market. Buying an EV can be good for the climate, and for your bank account.

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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.JPMorgan Chase is an advertising partner of The Ascent, a Motley Fool company. The Motley Fool has positions in and recommends JPMorgan Chase. The Motley Fool has a disclosure policy.

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When you get charged an annual fee on your credit card, that fee usually shows up on your statement. But, does it earn rewards? Find out here. 

When you spend money on your credit cards, you typically earn rewards for that spending — especially if you’ve chosen your card carefully.

In some cases, your credit card will charge you an annual fee for being a card member. This charge shows up on your statement just like other charges you make. When you pay your credit card in the month that the fee is charged, you’ll have to pay for the cost of the annual membership when you pay off your statement balance.

When you see the fee on your card statement, you may be wondering if you’ll earn rewards for it. After all, it shows up on your list of purchases along with everything else you bought during the month and you earned rewards for all of those purchases.

Here’s what you need to know about the rules for whether you get rewards when your annual fee is charged to your card.

Does an annual fee earn you credit card rewards?

Although an annual fee is typically listed along with other transactions on your credit card statement, it’s treated differently than the other purchases you make. Unsurprisingly, it’s classified as a fee, and like late fees, over-the-limit fees, or balance transfer fees, it’s not a purchase eligible for rewards.

Even as a credit card expert, this was confusing at first. The first time I saw my annual fee show up, I actually checked my credit card rewards statement to see if I’d earned the rewards on it since it was part of my monthly charges. Unfortunately, that particular transaction wasn’t counted among those that I got my cash back for, and when I called the issuer to ask, it made it clear that you never get rewards for those types of charges — just like you also wouldn’t earn rewards on any interest that accrues and is tacked onto the balance you owe.

The bottom line is, card companies have rules for the kind of spending that gets you points, miles, or cash back — and when the card company is charging you for something, it doesn’t turn around and reward you for paying them that cost.

Is an annual fee worth paying?

While it was disappointing to find out that you don’t get credit card rewards for paying an annual fee on your credit card, I’m still happy with the card I have and more than willing to pay the fee from my bank account. Other cardholder perks I get, such as airline lounge access, more than make up for the money I’m paying to have the card.

To determine if your card’s annual fee is worth it, consider how much the cost of the charge is and weigh it against the benefits. If you pay $95 for a card but get a $100 credit for airline incidental purchases, and you use that credit every year, for example, the card is well worth paying for.

As you do this calculation, though, just remember that even though the full fee amount is charged to your credit cards, no rewards are available to offset that cost, so you’ll need other cardholder benefits to justify the expense.

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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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If you don’t have a clear idea of your investment goals, you may find yourself without the funds you need later in life. Read on to see what to do about it. 

Your future financial security depends on your commitment to investing throughout your lifetime. While it may seem really hard to find money to save when you have other pressing life expenses, you’ll need some money to supplement Social Security in your old age since your benefits will only replace about 40% of pre-retirement income.

Unfortunately, many people simply aren’t saving enough. To find out if you’re one of them, watch out for these red flags that suggest you aren’t putting away the funds you need.

1. You don’t have a clear savings goal

If you don’t know what you need to save to end up with enough money as a retiree, it can be almost impossible to determine if you are investing enough. And, unless you’re just randomly putting a whole lot of money into a retirement account, chances are good you’re not going to be on track for a secure future if you don’t have a goal you’re working toward.

The good news is, it’s really simple to estimate how much you should be saving for retirement. A quick rule of thumb is to estimate you’ll need 10 times your final income. So, if you expect to be earning about $70,000 at the time you retire, your goal would be to have $700,000 in your retirement investment accounts.

2. Your investment account balance is below where it should be for your age

Saving for retirement is something you’re going to do throughout your life, so if you are behind based on the amount you should have saved at your age, this is also a big red flag.

Ideally, you should have the following amounts in your brokerage account or workplace retirement plan depending on your age:

One year of your salary invested by age 30Three times your salary invested by 40Six times your salary by age 50Eight times your salary by 6010 times your salary by 67

If you’re behind on these targets, you are going to have to save more later on since you won’t benefit as much from compound growth (which happens when investment returns are reinvested and earn money for you.

Say, for example, your goal is to have $1,000,000 by age 67. The table below shows how much you’d have to save each month based on the amount you have saved at age 40, assuming you make 10% average annual returns over your lifetime (this is in line with the stock market’s performance over the last 50 years):

3. You aren’t automating your investment contributions

If you want to make sure you’re investing enough for your future, you should have automatic contributions coming out of your checking account on payday or directly out of your checks. Doing this maximizes the chances you’ll steadily invest over time.

If you have to manually force yourself to contribute to a retirement account each month, there’s a much greater chance you won’t follow through or won’t have the money at the end of the month to invest. Set up automatic contributions on payday through your bank or brokerage firm or sign up to make 401(k) contributions through your employer’s HR department.

4. You aren’t tracking your progress toward hitting your target number

Finally, if you aren’t tracking your progress, then that’s a major sign that you’re not investing enough. You should check in around once every six months or once a year, see where your balance is, and make sure that you’re still contributing enough to be on track to hit your goals.

The calculators at Investor.gov can help you to determine if your investments are big enough given your current balance, retirement timeline, and likely rate of return.

If you spot any of these signs that you’re not making sufficient investments for retirement, you can make corrections right away by calculating your investing goal, setting up automatic contributions to target it, and tracking your progress over time. Get started today, as the sooner you begin, the easier it will be to hit your 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.The Motley Fool has a disclosure policy.

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Having the wrong insurance could be a huge financial mistake. Take these steps in 2024 to get the right coverage from a great company. 

Not having the right insurance can be a huge disaster — especially if the issue is not discovered until a problem occurs and a claim must be made. Without the right coverage in place from a trusted insurer, covering losses out of pocket could empty a bank account quickly.

To make sure an issue isn’t overlooked until it’s too late to fix, make these crucial moves in 2024.

1. Check your coverage to make sure you have enough

It’s critical to make sure that the insurance coverage in place is sufficient to provide full protection for assets. Specifically, policyholders should consider:

Coverage limits: Will the policy pay out enough to fully repair or replace any damaged property? For example, with home construction costs rising across the country, it may be necessary to increase policy limits on homeowners insurance to ensure that a house can be rebuilt as it stands in the event it’s destroyed in a covered disaster.Types of coverage: It’s also important to make sure the right kinds of coverage are in place. For example, a driver who now relies on their car to get to work every day may need to ensure they have rental car reimbursement as part of their auto insurance coverage so they’ll have a vehicle to drive if theirs is damaged by an accident and out of commission for a while.

Every policyholder should do a review to make sure their assets are fully protected based on the kinds of losses they’re covered against and the maximum payouts the insurer would provide.

2. Shop around and compare premiums

You should compare insurance premium costs each year for a few key reasons. For one thing, insurance offerings may have changed, so there may be a new, better, cheaper insurer out there.

Insurers also consider many factors in pricing coverage. One of those factors is whether the company thinks the policyholder is likely to shop around or not. If an insurer thinks a particular customer isn’t likely to explore their options and potentially change to a different company, the insurer may charge that customer more. This is called price optimization.

The good news is, it’s simple and quick to shop around and make sure that the price of insurance coverage is fair. Policyholders can do this online by getting quotes from a few different insurers.

3. Check your insurer’s reputation

Finally, it’s important to confirm there are no major issues with the insurer currently providing coverage. No policyholder wants to make a claim, only to learn that the company they have bought coverage from is slow to pay out claims, denies legitimate claims, or tries to lowball the amount it’ll pay.

To find out if an insurer has a solid reputation for customer service or is known for causing problems, consumers should check Better Business Bureau reviews, J.D. Power customer satisfaction surveys, and the complaints database maintained by the National Association of Insurance Commissioners. If you see a recurring theme of complaints, you may want to consider switching companies.

Policyholders who take these three steps can avoid major financial regrets. They’ll make certain they have affordable insurance from a good insurer, and that they have the right level of coverage in place in case something goes wrong.

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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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