Money Management

As you make financial goals for 2024, consider the small changes that can help you get there. Find out which small financial changes can offer big results. 

A new year is almost here. According to The Ascent research, 67% of Americans plan to make financial resolutions for 2024. So you’re not alone if you’re considering establishing some financial goals for the new year.

Believe it or not, small changes can make the most impact. Here are some simple changes you can make to fulfill your New Year’s money goals, and how they can impact your personal finances in the new year and beyond.

1. Get budgeting

If you’re aiming to save more money or reduce your spending, budgeting can help. Learning to budget can completely transform how you manage your money. Setting spending limits and monitoring where your cash goes is simple, thanks to the best budgeting apps. Developing critical budgeting skills will make you feel more in control of your money.

2. Cancel unused subscriptions and memberships

Once you get comfortable budgeting, you’ll know how your money is being spent and can decide what purchase decisions you may want to change. Many people pay for subscriptions and memberships they no longer use because they forgot about them, which results in wasted money. By canceling at least one unused subscription or membership, you can free up money that can be used elsewhere. This action is a simple and effective way to make a big change.

3. Put your savings on autopilot

Have a big savings goal for 2024? You can do it. Automating the savings process is a simple strategy that can keep you on track. You can enable automated transfers so money is transferred from your checking account to your savings account as often as you want. This one step eliminates the manual process, saves time, and keeps you from spending your money before it gets saved. Trust me, I follow this strategy, and it’s been a game changer.

4. Add a rewards credit card to your wallet

Perhaps one of your goals is to start getting rewarded when you spend money on everyday purchases. An easy way to start doing this is to add a rewards credit card to your wallet. Many people hope to start earning credit card rewards but never get anywhere because they feel overwhelmed when they see all the available credit cards. But don’t overthink it.

As you compare credit cards, pay attention to the details and top features — the annual fee (if any), how the card earns rewards, and how you can redeem the rewards. Don’t forget to consider your own financial profile too — what credit score is needed to be considered for the card you’re after? The first step in achieving your goal of earning credit card rewards is to get one that earns rewards. Here are some of the best cash back rewards credit cards to consider.

5. Continue learning important finance skills

It’s never too late to improve your finances, and you can always learn more. As you make progress in your journey, continue to absorb new information. Taking the time to learn new money management skills and reading more about financial topics can help you be more successful as you work to reach your goals in the new year.

Don’t give up

It takes hard work and dedication to conquer big goals. But I believe in you. Small changes can make a huge difference, and as you see your financial situation improve and transform, it can help motivate you to keep going when you feel stuck. Don’t give up — you’re doing a fantastic job. For additional tips, check out our free personal finance resources.

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

If you’re using the wrong credit or debit card, it could be costing you serious money. Our experts love this top pick, which features a 0% intro APR for 15 months, an insane cash back rate of up to 5%, and all somehow for no annual fee.

In fact, this card is so good that our experts even use it personally. 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 

Borrowing is expensive right now across the board, including auto loans. Will things improve in 2024? Read on to find out. 

It’s pretty fair to say that 2023 has been an expensive year to borrow money. And the reason has to do with inflation and the Federal Reserve’s response to it.

The Fed’s job is to control monetary policy and do what it can to support a healthy U.S. economy. In 2022, in light of surging inflation, the Fed had to take action by raising its federal funds rate, which is the rate banks charge each other for short-term borrowing. The Fed has raised interest rates 11 times since early 2022.

One big misconception about the Fed is that it’s tasked with setting consumer interest rates — rates for products like mortgages and personal loans. In reality, those rates are set by individual lenders, and the Fed doesn’t control what they do. However, because an increase in the federal funds rate makes short-term borrowing more expensive for financial institutions, they tend to pass that cost onto consumers who seek to borrow money.

Meanwhile, auto loan rates have been up this year as part of a broad trend. But will auto loans get less expensive in 2024? There’s reason to believe they just might.

The Fed may be done raising interest rates, and rate cuts may be in sight

The Fed’s goal is to cool inflation and, ideally, bring it down to 2% on an annual basis. In November, annual inflation was measured at 3.1%, as per last month’s Consumer Price Index. That’s not quite where the Fed wants things to be, but it’s also not so far off.

Meanwhile, at its last three meetings, the Fed opted to pause its interest rate hikes and leave its benchmark rate where it is. Many financial experts are convinced that the Fed is done raising interest rates for the time being.

More so than that, if inflation continues to trend in the right direction in 2024, the Fed might start to cut rates. That could, in turn, lead to lower borrowing rates for a host of consumer products, auto loans included.

How to snag a good deal on an auto loan

Buying a car is an expensive prospect even when borrowing rates are more favorable. While rates could come down in 2024, it’s fair to say that auto loans won’t exactly be cheap as a result.

If you want to do your part to snag the best deal possible on an auto loan, work on boosting your credit score. Your credit score tells lenders how risky a borrower you are. A higher score sends the message that you’re a reliable borrower with a history of repaying debts on time. And a lender might reward you with a lower interest rate on an auto loan if you apply with a credit score in the upper 700s or higher.

There are different ways you can go about boosting your credit score. One is to pay all bills on time. Another is to check your credit report for errors, since an error (like a debt listed in your name that you never racked up) could be dragging your credit score down.

Another step to take when financing a car is to shop around with different lenders. You may find that one lender is simply more competitive than another — perhaps because it’s looking to drum up business. So it always pays to do some rate-shopping.

Finally, the less you pay for a car, the less money you might have to borrow. If you’re worried about keeping up with auto loan payments, try to avoid the temptation to upgrade to a fancier vehicle model or to buy the added features. Instead, aim for a car that’s safe, reliable, and big enough to suit your needs.

There’s a good chance auto loans will be less expensive to sign at some point in 2024. But you should also do everything in your power to set yourself up with the most favorable rate possible.

Our picks for the best personal loans

Our team of independent experts pored over the fine print to find the select personal loans that offer competitive rates and low fees. Get started by reviewing our picks for the best personal loans.

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 

We’re running out of time to finish making IRA contributions in 2023. If you haven’t maxed out your IRA yet, read on to see why you shouldn’t sweat it. 

Saving for retirement in a traditional IRA is beneficial for a couple of reasons. First, the money you invest in one of these accounts gets to grow on a tax-deferred basis. This means gains in your IRA aren’t taxed year to year, but rather, only when you take withdrawals.

Another big benefit of putting money into a traditional IRA is that you get to shield some of your income from taxes. So if you put $1,000 into an IRA, the IRS can’t tax you on that portion of your earnings.

IRA contributions, however, max out at a certain limit that can change from year to year. In 2023, you can contribute up to $6,500 to an IRA if you’re under the age of 50. If you’re 50 or older, the limit is $7,500 thanks to a $1,000 catch-up contribution option.

And to be clear, you don’t have to be “behind” on IRA contributions to put in that extra $1,000. All you have to do is turn 50 at some point during the year you want to put in that extra $1,000, or be above the age of 50 already.

Your goal may have been to max out your IRA in 2023, or to contribute a different amount. But if it didn’t happen, you may be worried about running out of time. The good news, though, is that you may have more flexibility to fund that account than expected.

You get more time than you think

If you’re looking to put more money into your 401(k) for 2023, then you only have until Dec. 31 to contribute additional funds. Money contributed beyond Dec. 31 won’t count for 2023 purposes.

IRAs work differently, though. With an IRA, you get until the following year’s tax-filing deadline to finish funding your account. What this means is that you have until April 15, 2024 to fund your IRA and have it count for 2023.

So let’s say you’re 40 years old and want to max out your 2023 IRA, but you’ve only put $5,000 into that account to date. It may not be feasible to come up with an additional $1,500 in the next two weeks. But it may be feasible to come up with that money over the next four months.

Automatic contributions could help you stay on track

Some people fund their IRAs by transferring money into those accounts at the end of the month. But if you take this approach, you might have a month when you spend extra and therefore can’t make a contribution. That could lead to a situation where you’re nearing the end of the year and your savings goal hasn’t been met.

A better bet? Figure out what you can afford to invest for retirement on an annual basis, and then set up an automatic transfer to your brokerage account.

Let’s say you feel that contributing $3,000 a year is what’s feasible for you. What you’d want to do is set up an automatic transfer of $250 a month into your IRA so that money lands there without you having to take any action.

There’s still plenty of time to finish funding your IRA for 2023, so don’t panic if you haven’t maxed out or put in the amount you wanted to contribute this year. But in general, it’s best to finish funding an IRA during the calendar year it’s designated for. That way, you can focus on funding your IRA for the following year after Jan. 1. Going forward, consider setting up an automatic transfer so you don’t feel as if you have to scramble to get your IRA funded.

Our best stock brokers

We pored over the data and user reviews to find the select rare picks that landed a spot on our list of the best stock brokers. Some of these best-in-class picks pack in valuable perks, including $0 stock and ETF commissions. Get started and review our best stock brokers.

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 

Now is the time to set new goals for 2024. If you want to work on financial goals, you’re not alone. Find out what you can do to ensure you achieve them. 

For many people, a new year is a time for growth. It’s also a popular time to make resolutions. Research from The Ascent shows that 67% of Americans hope to tackle financial resolutions next year. Now is the perfect time to sit down and plan what goals you want to reach. You can do it no matter how big or small your goals are. Here are some tips to help you achieve your financial goals in 2024.

1. Define clear goals

As you outline your financial goals for 2024, make sure they’re clear and specific. Being clear about what you hope to achieve can help you stay focused on the goal. Doing this can also make it easier to develop a roadmap to get there so you’re successful by year-end. It can also reduce the chance of you making excuses or giving up halfway through your journey.

Here’s an example:

Let’s imagine you want to boost your emergency fund savings. That goal alone is not enough. You have a general idea of what you hope to achieve, but it’s not specific enough. If you instead set a goal to increase your emergency fund balance by $3,000, that’s clearer.

Now, you can look at the bigger goal and determine what steps you need to take to get there. If you want to save an extra $3,000 by the end of 2024, you can make it happen by transferring $250 to your savings account each month.

See how being specific and clear can help? I encourage you to give it a try as you set goals.

2. Track your progress

Another way you can set yourself up for success as you work to achieve your financial goals is by tracking your progress. When life gets busy and times get tough, it can be easy to feel discouraged. Tracking your progress can help you stay motivated during those moments. It can better illustrate how much closer you are to reaching your goals.

One option is to use financial apps to monitor your progress. If you want to completely eliminate your credit card debt, debt payoff apps can show your progress. For those hoping to reduce their spending by $300 a month (remember, specific goals are ideal), one of the best budgeting apps can help. Don’t ignore tools like this that can help you stay on track.

Another option is to track your progress the old-school way — with pen and paper. You can have fun using colorful markers and creating charts and graphs. You can even get some silly stickers to add to your progress records. Every so often, look at your progress charts and notes to remind yourself how far you’ve come. It’s easy to forget how much work you’ve put in.

3. Don’t deprive yourself

Treat yourself with kindness as you work to make your financial resolutions a reality. Thank yourself for investing in your future and putting in the extra effort, even when times get tough. Reward yourself for sticking to your goals. You deserve the recognition for your efforts.

One final tip: Don’t deprive yourself. You work hard for your money. You will burn out, feel discouraged, and lack motivation if you put every cent you earn toward your financial goals, whether that’s an investing, saving, or debt payoff goal. Allocate some of your money toward things that bring you joy. You have to take care of yourself first if you want to change your life.

Now is the time to set new resolutions

There is still time to establish financial resolutions for the new year. But don’t delay much further. The busy holiday season is upon us, and you want to be ready to tackle your goals as soon as 2024 is here. I believe in you. For more guidance, check out our personal finance resources.

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

If you’re using the wrong credit or debit card, it could be costing you serious money. Our experts love this top pick, which features a 0% intro APR for 15 months, an insane cash back rate of up to 5%, and all somehow for no annual fee.

In fact, this card is so good that our experts even use it personally. 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 

Looking to save on auto insurance? Read on to see how you can lower your costs. 

When you own a vehicle, paying for auto insurance is an expense you need to factor in. U.S. News & World Report says the average cost of auto insurance is $1,547 per year. But the amount your auto insurer charges will hinge on factors that include where you live, the type of car you have, and the amount of driving you typically do.

You may be eager to lower the cost of your auto insurance. Every dollar you don’t pay your insurer is a dollar you get to keep. Here are a few tactics you can use that could result in savings.

1. Increase your deductible

When your vehicle is damaged and you file a claim with your insurer to get it fixed, you pay a deductible before your insurer covers the rest of the tab. It’s usually the case that the higher your auto insurance deductible, the lower your premium will be. And so if your deductible is fairly low right now, raising it could result in cheaper premiums.

Of course, in doing so, you’re taking the risk of having to pay that higher sum of money in the event of an accident. But think about it this way. If you get lucky, you might have several years in a row where you don’t have to pay your deductible at all. On the other hand, your premium is an expense you have to pay every year no matter what.

2. Bundle with your homeowners policy

Own a home? You’ll need to keep it insured at all times. And if you’re not currently using the same company for auto and homeowners insurance, you may be missing out on a discount.

If you’re getting your auto insurance from one company and your homeowners policy from another, reach out to each to ask about bundling and see which one comes up with the better offer. If you’re not particularly impressed with the savings from either, reach out to companies you haven’t used. There’s absolutely nothing wrong with shopping around, even if you’ve used the same insurer for years.

3. Maintain a safe driving record

If you have a safe driving record, it sends the message to your insurer that you’re not the type to take risks while out on the road. And you may be rewarded for that in the form of lower insurance premiums.

Of course, sometimes, life gets the better of us. You might end up getting pulled over for speeding or weaving in and out of traffic due to being in a hurry. To avoid that, leave yourself more time to reach your various destinations. It might help keep you in check on the road.

4. Take a defensive driving course

You can be a perfectly cautious driver and still get in an accident. And sometimes, avoiding an accident boils down to having experience on the road.

If you’re a newer driver, you may not have a whole lot of experience just yet. In that case, it could pay to take a defensive driving course. It could also pay to take one if you’ve recently gotten a black mark on your driving record due to something like a moving violation.

That said, don’t just search for a course online, pay the fee, and call it a day. Instead, reach out to your insurer to ask about approved courses. You don’t want to waste your time and money on a course that may not change your premium costs one bit.

The less you’re charged for auto insurance, the more manageable that expense might be. Take these steps to lower your car insurance costs — and bank the money you’re not spending for yourself.

Our best car insurance companies for 2022

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.The Motley Fool has a disclosure policy.

 Read More 

New economic data looks good, but Americans are still skeptical. Here’s how to prepare for your finances no matter what happens. 

The most recent jobs data was a good indicator that the U.S. economy may be able to pull off a so-called soft landing. Generally speaking, a soft landing would mean inflation is cooling down, job growth is steady (but not too high), and the unemployment rate is still low.

And there are some good reasons to think that the U.S. economy may end up with a soft landing and avoid a recession.

The latest jobs and inflation data look good

The Labor Department said recently that the economy added a seasonally adjusted 199,000 jobs in November, which is similar to pre-pandemic levels of growth and falls within the moderate gains range economists are looking for.

Additionally, the federal agency said the unemployment rate fell slightly to 3.7%, which marked 22 consecutive months of the unemployment rate below 4%. So that’s two boxes checked for a soft landing.

The third box, cooling inflation, may have also been checked off. Inflation rose by just 3.1% in November. That’s much slower inflation growth than in the recent past and getting closer to the Federal Reserve’s 2% target. Following the latest inflation data, Treasury Secretary Janet Yellen said she saw no reason why inflation wouldn’t continue to cool and said she believes the U.S. is on the “path” to a soft landing.

But not everyone is convinced that the U.S. will avoid a recession in 2024. And if one is around the corner, there are a few things you can do to prepare your personal finances.

How to get financially prepared for harder times

Despite the positive economic data, most Americans aren’t exactly optimistic right now. A recent CBS News poll found that 76% of Americans say their income isn’t keeping pace with inflation, and 62% say the state of the economy is “bad.”

If you’re concerned about where the economy is now or where it may be headed, here are three steps to take to get your personal finances in order:

Save what you can: This can be difficult if you’re already strapped for cash, but look for ways to reduce spending. You might be able to cancel one video streaming service or cut out one or two nights of eating out per month. Everyone’s monthly budget is different, but the main idea is to find one or two expenses you can cut to build up some emergency savings.Pay off high-interest debt: Ideally, you want all your debts paid off, but start with high-interest debt like credit cards. Consider using the debt snowball method to chip away at your credit card debt. The more aggressive you can be toward paying off your debt, the better off your finances will be if an economic slowdown happens.Find ways to boost your income: There are many ways to make extra money, including using your existing skills for gig work. I made additional income this year by picking up extra freelancing work, and many gig work platforms make it easy to get started.

Following the steps above will put you in the best financial position possible if a recession occurs. And if the economy ends up pulling off a soft landing and inflation continues to subside, you’ll still be glad you put in the effort toward reducing your debt and adding some extra cash to your emergency fund.

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

If you’re using the wrong credit or debit card, it could be costing you serious money. Our experts love this top pick, which features a 0% intro APR for 15 months, an insane cash back rate of up to 5%, and all somehow for no annual fee.

In fact, this card is so good that our experts even use it personally. 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