Money Management

Want a new iPhone or iPad? Read on to see why buying it from Costco could be a good bet. 

Some people swear by Apple products and can’t imagine using any other brand. If you’re someone who owns an Apple device, your phone or iPad may no longer suit your needs the way it did when you first bought it. Maybe you need a phone with more memory. Or maybe your iPad is missing some key features that could otherwise enhance your user experience.

If you’ve been itching to upgrade your Apple device, you could always try to sell it on your own and use your proceeds to buy something new. But if you want an easy way to go about the process, then you may want to turn to Costco.

A seamless way to trade up

Costco’s Apple trade-up program is designed to make the process of upgrading your device as smooth as possible. The way it works is simple: First, you go online and enter your device’s serial number. You’ll be asked some questions about your device’s condition that you’ll need to answer honestly.

From there, you’ll get a quote on its trade-in value. If you don’t like the number you see, you can opt to just sell your device on your own. But if you think the offer is fair, all you’ll then need to do is send your device in and get paid via a Costco Shop Card — the store’s version of a gift card. You also won’t have to spend money to ship your Apple device — you’ll be sent pre-paid shipping supplies and packing instructions to your address.

Just as importantly, once your Apple device is received, all of your stored data will be wiped. That way, you won’t have to worry about private information, like a stored credit card number, getting into a new user’s hands.

Once your device’s condition is confirmed, you’ll get your Costco Shop Card in two business days if you sign up to have it emailed. Otherwise, you’ll generally wait seven to 10 business days to get it by mail.

Completing your upgrade

Once you have your Costco Shop Card, you have choices for completing your upgrade. You could use that card to help pay for a new Apple product at Costco. Costco carries a host of iPad options, for example, whose prices vary depending on the features at hand.

But what if you find a better price elsewhere? If you do your research, you might.

In that case, what you can do is use your Costco Shop Card for purchases like groceries and household items, and then take the money you would’ve spent on those essentials and apply it toward a new Apple purchase instead. It’s especially worth shopping around for deals on Apple products in December if you’re looking to trade up soon, since different retailers have different sales going on around the holidays.

Apple products don’t last forever, and you may be at a point where you want to trade yours in before it starts to show its age. If that’s the case, consider going through Costco for the ease and convenience involved.

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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 positions in Apple. The Motley Fool has positions in and recommends Apple and Costco Wholesale. The Motley Fool has a disclosure policy.

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Today’s mortgage rates aren’t the highest, historically speaking. But read on to see why it’s so tricky to buy a home today. 

If you’re having a hard time affording a home today, it may be because mortgage lenders are charging pretty high interest rates at a time when home prices are also up. But while today’s rates might seem exorbitant, they’re nowhere near as high as mortgage rates were back in the early 1980s.

In 1981, mortgage rates peaked at around 18%. By contrast, over the past several months, they’ve held steady in the 7% range. But even though mortgage rates were so much higher back in the early 1980s than they are at present, it was still easier to buy and own a home 40-ish years ago.

Home prices have soared — but wages haven’t

During the third quarter of 2023, the median U.S. home sale price was $431,000. During the third quarter of 1981, it was $69,200.

So now, let’s run some numbers. Let’s assume that a buyer in 1981 was looking at a home worth $69,200 at an 18% mortgage rate for a 30-year loan. With a 20% down payment, that translates to a monthly mortgage payment of $834 for principal and interest.

Now, let’s look at a home worth $431,000. At 20% down and a 7%, 30-year mortgage, the monthly payment for principal and interest is $2,293.

All told, it costs almost triple to own a median-priced home today than it did in the early 1980s. The problem, though, is that wages haven’t tripled. Not even close.

During the third quarter of 1981, the median usual weekly real earnings were $309. During the third quarter of 2023, they were $365. Based on this, we can draw the conclusion that although the median U.S. home was probably not affordable for a median earner in 1981 just as it’s not affordable for a median earner today, homes were still more affordable 42 years ago.

How to know if you can afford a home today

As a general rule, it’s a good idea to keep your housing costs to 30% of your take-home pay or less. But that 30% shouldn’t just include your mortgage payment. It should also account for additional recurring costs like property taxes and homeowners insurance.

So, let’s say you’re looking at a monthly mortgage payment today of $2,293, but when you add in property taxes and insurance, you’re up to $2,600. That means your monthly take-home pay would need to be $8,667 for a home costing that much to be affordable.

Of course, you may be able to find a home that’s far less expensive than the median home today. And you might live in an area where property taxes and homeowners insurance are not very costly.

The point, however, is that it’s hard to buy a home today on a typical wage — even harder than it was 42 years ago. And it’s important not to stretch your budget to buy a home because spending more than 30% of your take-home pay on housing could put you at risk of losing your home and/or falling behind on other bills.

Hopefully, in time, home prices and mortgage rates will come down. But even so, unless wages manage to pick up, a lot of people are, unfortunately, likely to find themselves continuously priced out of homeownership.

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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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Americans spent $3,639 on eating out last year, nearly 40% of their total food spending. Find out how you can enjoy fast food without breaking the bank. 

The cost of food has skyrocketed in recent years, and fast food is no different. From soaring prices to shrinking value options, these stats illustrate everything you need to know about the fast food industry. Plus, we’ve got plenty of inflation-beating tips so you can dine out without destroying your budget.

1. The cost of a Big Mac is over $5.50 — up 33% in 10 years

The average cost of a U.S. Big Mac in June 2023 was $5.58, according to The Economist. That’s $1.40 more than it was in June 2013. The Economist has been tracking the cost of McDonald’s signature burger around the world for almost 40 years. It uses so-called “burgernomics” as a tool to compare purchasing power in different countries.

What you can do about rising fast food costs

If you want to cut the cost of fast food, keep your eyes peeled for discounts, wherever they may be. For example, check your receipt next time you buy pizza or a burger. There may be a discount you can use on your next visit or a survey you can fill out in exchange for free food.

Another route is to install the app for your favorite restaurants and sign up to their loyalty program. This is a great way to keep on top of the latest deals and earn rewards. For example, McDonald’s will give you free fries when you install its app, and you can use your points to pay for your meal.

Use coupon apps and sites like Groupon or RetailMeNot to get discount coupons. You might find a fixed dollar discount such as $10 off your next Pizza Hut order, cash back, or a percentage discount. I’ve used Groupon to get half-price meals before. Those savings all add up to more cash in your bank account.

2. McDonald’s Dollar Menu is a thing of the past

The cost of a Big Mac only tells part of the story when it comes to budget fast food deals. It doesn’t factor in promotions or low cost everyday items. Ten years ago, a Big Mac cost over $4, but you could get a basic burger for $1. Now its value menu is a “$1 $2 $3 Dollar Menu.” And — as one TikTok user recently pointed out — there’s nothing on it that costs a dollar. McDonald’s is not alone in this. Little Caesars Hot-N-Ready pizza no longer costs $5, and Burger King customers have also taken to social media to complain about price hikes.

What you can do about disappearing value menus

Inflation has made it harder, but not impossible, to find low-cost fast food. One chain that’s stuck by its value offer is Costco. Costco’s hot dog and soda combo has cost $1.50 since the 1980s and the company plans to keep it that way.

Costco’s not the only place you can get fast food for less than a couple of dollars. Right now, Sonic’s FRITOS Chili Cheese Jr. Wrap comes in at $0.99. And Del Taco has a menu with 20 items under $2 — including tacos, burritos, nachos, and donut bites.

3. The average pizza check comes to $8

Consumer behavior data providers, Circana, say that people’s average check at a pizza joint is $8 and $6.56 at a hamburger chain. For many Americans, that’s still an affordable treat, even at the higher prices.

Latest data from the Bureau of Labor Statistics (BLS) says that the prices of take-out meals and fast food (which it calls limited service meals) rose 6.2% from October 2022 to October 2023. That’s a bigger jump than restaurant prices, which rose 4.3% in the same period.

How to spend less when you’re in a fast food joint

When I get takeaway curry, I never buy rice as I can cook it in 10 minutes at home. If you only buy the main, it’s often a great way to shrink your check. For example, a large pizza that feeds four people would set you back around $20 at Pizza Hut. Skip the sides and the drinks — and you’re looking at a bit over $5 a head. It’ll be less if you get one of their deals or use a discount code.

4. Americans spent $3,639 on eating out last year

Food accounted for about 13% of people’s average spending last year. BLS data shows that the average American spent $9,343 on food in 2022. About 40% of that went toward eating out. That adds up. Data from the U.S. Census Bureau shows that Americans spent over $92 million in eateries in September alone.

How to spend less on fast food

One of the best ways to spend less on food is to cook at home. I always have staples such as canned vegetables, pasta, and rice in my cupboard. Here’s what the basic ingredients for a quick tuna pasta cost on Walmart.com:

Can of tuna (5 oz): $0.96Pasta (16 oz): $1.18Pasta sauce (24 oz): $1.70Shredded cheese (8 oz): $2.22

It won’t be gourmet, but with four ingredients, I can cook a quick meal in about 15 minutes. That’s less time than my local Domino’s takes to deliver, and means I can feed four people for around the same price as a single takeaway pasta dish.

Bottom line

It’s true that you can save money on food by cooking at home, but eating the occasional meal out can be fun, not to mention saves you the hassle of doing the dishes. Use coupons, mobile apps, and meal deals to keep fast food as affordable 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.Emma Newbery has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Costco Wholesale and Walmart. The Motley Fool has a disclosure policy.

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