Money Management

Credit card mistakes can cost you money and hurt your credit score. Find out what to avoid doing with your credit cards in 2024. 

People often have strong opinions for or against credit cards. Your experience largely depends on how you use them. The best credit cards pack in lots of valuable benefits, to the point where savvy cardholders save hundreds or even thousands of dollars per year with them.

However, if you don’t manage your credit cards well, they can cost you just as much. Coming out ahead isn’t too difficult, but you’ll need to avoid a few big credit card mistakes.

1. Spending more than you can afford

The No. 1 reason people get into trouble with credit cards is overspending. Credit cards make it easy to spend money you don’t have. It’s possible to get approved for high credit limits, especially if you have a good credit score. For example, some people have reported getting $10,000 credit limits on salaries of $30,000 to $40,000 per year.

No matter what your card’s credit limit is, don’t make purchases based on your spending power. Only make a purchase if you can afford to pay it back that same day with money in your bank account.

Resist the temptation to buy anything you can’t afford. It doesn’t matter if you’ll have the money by the time your credit card bill is due, or if you’ll be able to pay it off within a couple of months. When you start doing this, it’s easy to get into the habit of overspending, and that leads to credit card debt.

2. Only making the minimum payment

You’re required to make a minimum payment on your credit card every month, but the minimum isn’t much. On balances of $1,000 or more, the minimum payment normally comes out to 1% or 2%.

Paying the minimum may be the cheapest short-term option, but there’s a massive long-term cost. Let’s say you have a $5,000 balance on a card with a 22% interest rate. If you only make minimum payments, it will take you over 23 years to pay off that balance. In that time, you’ll pay $8,527 in credit card interest.

The best option is to pay your credit card’s full balance every month. You won’t be charged any interest on your purchases if you do this. If you currently have credit card debt, pay as much as you can toward it each month. You may not be able to pay it off all at once, but paying more than the minimum makes a big difference.

3. Using the wrong credit card

When you’re building up your credit, card options can be limited. You may need to stick to secured credit cards that are open to applicants with any credit history.

But if you have good credit, you can likely qualify for lots of credit cards. If so, it’s important to make sure you’re using a quality card that matches your needs. Here are a few examples:

If you want to earn money back on your expenses, many cash back cards earn between 1% and 6% on purchases.If you travel often, you could save on the cost of your trips with travel credit cards.If you have credit card debt, you could refinance it at a 0% intro APR with a balance transfer credit card.

Using the wrong card may not seem like a huge issue, but it can cost you. Let’s say you have credit card debt, and you’re using a cash back credit card. Even if you earn 2% back on your purchases, you’ll likely be paying 20% or more in interest.

You’d be much better off getting a balance transfer card. Then, you can transfer your credit card debt to it and pay it off at a 0% intro APR.

4. Missing payments

If you don’t make your credit card payment on time, the card issuer can charge you a late fee. By law, the maximum fee amount on your first late payment is $30. For each additional late payment within the next six billing cycles, the maximum fee is $41.

Along with the financial cost, late payments can also hurt your credit score. Fortunately, they don’t have an impact right away. Your payment must be at least 30 days late to count against your credit score. Once it’s that far past due, your score could drop by over 100 points.

This type of fee is 100% avoidable. Set up a reminder for yourself, or set up auto-pay on your credit card. If you slip up, make the missed payment ASAP and contact your card issuer to ask if it will waive the late fee. Most credit card companies will waive your first late fee if you ask. With Discover credit cards, this is even done automatically.

Credit cards can be a valuable financial tool. Now that you know which mistakes to avoid, you can get the most out of your cards.

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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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It takes 30 seconds to filter scammy reviews. Check out a few ways to make shopping online more affordable. 

The holiday season is upon us. It’s a fun time with a fraught lead-up, typically. But last year, a miracle happened. I slashed my shopping time in half and somehow acquired over 99% of things on my shipping list (out of 16 swings, I missed one).

I’ve done a deep dive into my shopping habits, good and bad, and brought the best to the surface.

Feel free to use these five tips to control time and money spent shopping. I’ll be recycling all of them to make online shopping faster and more affordable in 2023.

1. Use the Fakespot Chrome extension

Amazon reviews have a way of gripping me by my feet and dragging me under. This one said one thing; that one said the opposite. Whom do you trust? How do you know?

The solution was installing the free Fakespot extension, which helps me spot fake reviews. It’s especially useful on Amazon. I can see low-quality reviews at a glance. If curious, I can dive deeper into ratings, which are ranked alphabetically for quality and by stars for recency.

One time-saving perk: Fakespot will hide ads and order Amazon products from best-to-worst reviews, hiding scammy products with a click. I often use these settings when searching for something with a million near-identical copies, like protein powder.

2. Shop used and refurbished

The spirit of the holiday season gripped me like a kid holding a candy bar. I wanted — no, needed to buy Mom the ultimate holiday gift: a pair of AirPods. I rushed to the Apple Store, checked the price tag, and promptly blacked out.

Big-ticket items can break your budget like nothing else. Shopping for used and refurbished items is a great way to slash costs without forgoing quality. eBay, Poshmark, and Mercari are my go-to stores for all things clothes and electronics. Typically, I can buy lightly used items for 30% to 50% off.

My mom got her AirPods 30% off. How I did it: I plugged “refurbished AirPods” into Google and found BackMarket, which offered me a one-year warranty and a huge discount. I took it, returned them when they malfunctioned, and then got a fresh pair for Mom.

3. Search, not browse

Two weeks more until the deadline, and I was done. I was done. My swivel chair spun in circles. A miracle. Definitely, a miracle. It was my first time getting my shopping done weeks ahead of time. The reason: my highly specific shopping list, which made it possible to search, not browse.

Searching versus browsing is the difference between shopping for five minutes versus five days. It takes 15 minutes to browse Zara shirts, 10 minutes to stress over colors and sizes, and 24 hours to waffle over buying this brand instead of that one. Browsing takes time.

How long does it take for me to search and buy a “red M Zara flannel?” Maybe 10 minutes.

The key to searching, not browsing was asking friends and family to be specific about their holiday wish lists. Once I knew what to look for, shopping online became as easy as checking boxes. Sometimes it’s fun to browse, but searching is often a more cost-effective way to shop.

4. Buy direct

Mobile apps like Shop are great for window shopping. I like how clean the Shop app is — it’s less cluttered than, say, the Ministry of Supply website. And I can buy all my brands on Shop. But it’s often more expensive than buying directly from store websites.

Two reasons: rewards and promotions. Many retailers offer membership rewards that buyers can only earn by shopping through the store website. In the same vein, many stores offer site-only promotions, such as codes you can type at checkout to redeem 15% off.

You can get the best of both worlds by browsing on third-party apps and switching to the original website at checkout. Sometimes, I save a little extra by doing so.

5. Swipe the right cards

I have a confession: unlike many staff members at The Ascent, I really like store credit cards. Not all of them, but the ones I have save me lots. The key is knowing when to swipe the right cards.

That’s because I’m the kind of shopper who spends tons of money at my favorite stores. Take Amazon, for example. I spend hundreds of dollars per month on everything from protein shakes to ethernet cables. By swiping my Prime Visa at checkout, I get 5% cash back on my purchases.

The disadvantage of store credit cards is that they’re only useful at specific stores. When I shop outside of Amazon, I prefer to use all-arounders: cash back credit cards that earn me up to 6% cash back no matter where I shop. It makes shopping a little more affordable.

Simple and cost-effective

If I had a nickel for every time I read a “5 Ways” list, only to immediately forget about it, I’d have, like, 20 nickels. The thing is, tips and tricks are only as useful as they are simple.

Here’s one simple, two-step plan for shopping cost-effectively:

Install FakespotMake a shopping list

That’s all it takes to dodge scammy Amazon reviews and make shopping more cost-effective. I’m excited to shop around eBay for specific items this holiday season. It’s a little intimidating, tackling that list, but it’s nice having a plan to keep things fast and affordable.

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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.John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Cole Tretheway has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Amazon, Apple, and Visa. The Motley Fool has a disclosure policy.

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Christmas shopping can be overwhelming. Find out how Costco is making it just a little easier to find the right gifts for the men in your life. 

‘Tis the time of year for gift-giving, which can be easier said than done. After all, what do you give the man who has everything? Whether you’re shopping for your father, partner, child, or friend, you want to get it “just right.” We combed through Costco’s latest deals to find gifts we believe any man would appreciate.

One important thing to remember: One or all of these selections may be unavailable at your local Costco warehouse, so if anything strikes your fancy, consider ordering it on Costco.com.

1. Bulova Marine Star Chronograph Stainless Steel Men’s Quartz Watch: $240

Why it’s a great deal: The Marine Star watch is currently on sale for $442 through Bulova.com, $202 more than the Costco price.

With a distinctive face and stainless steel band, this watch features Japanese quartz movement and a water resistance depth of up to 328 feet (100 meters).

2. Avalanche Men’s Quarter-Zip Top: $15 (with $4 manufacturer’s savings, valid through Dec. 25, 2023)

Why it’s a great deal: Avalanche Outdoor Supply currently has its quarter-zip top marked down from $40 to $24, meaning the sale price is still $9 higher than Costco’s price.

Costco may not be the first place you think of when clothes shopping, but take our word for it – this is a great-looking piece of clothing. With a contrasting zipper, hem, and cuffs and an embroidered logo on the sleeve, it manages to be simple and distinctive all at the same time.

3. Dunhill Gold Yellow Sunglasses: $160

Why it’s a great deal: We looked, and the next lowest price we could find for these sunglasses was $280 through EyeSpecs.com. If you want to buy something nice but are carefully protecting your checking account balance, these sunnies are a good option.

If you know a man who would look amazing rocking a pair of aviator sunglasses, now’s your chance to snag a bargain on a high-end pair with titanium frames and 100% UV protection.

4. Conair All-in-One Metal Groomer with Interchangeable Magnetic Attachments: $30

Why it’s a great deal: Amazon’s price on the all-in-one groomer is currently $75, a full $45 more than Costo’s price.

This is not your father’s standard morning tool. The Conair groomer gives the user 18 possible hair and beard trimmer lengths, is 100% waterproof, and comes with patented quick-change magnetic heads. Plus, the lithium ion battery holds a charge for up to four hours.

5. LG 70″ – UR8000 Series – 4K UHD LED LCD TV: $500

Why it’s a great deal: We compared apples to apples and found the same television at ShopEzUSA.com. The major difference was the price. At $630, it would set you back an extra $130.

If there’s a man in your life who swears he can tell how many pixels a model has just by looking, this Smart TV is likely to have everything he’s looking for. With bells and whistles galore and a three-year warranty, you can spoil him without having to borrow against your home equity.

6. Chefman Home Slice™ Electric Indoor Pizza Oven: $300

Why it’s a great deal: Buying the same Chefman pizza oven at Walmart would cost you a full $200 more.

How amazing would it be to come home to the aroma of artisanal pizza baking in the kitchen? With heating capability up to 800°F and a double-pane glass window, the Chefman Home Slice™ creates 12-inch pizzas with a perfect crust and melted cheese. Plus, with six presets, the user only needs to let the oven know which type of pizza they’re making.

7. Inspire Fitness 45/90 Hyperextension Bench: $390 (deal ends on Dec. 24, 2023)

Why it’s a great deal: The price on the same hyperextension bench at Walmart is $549, meaning you’ll save $159 using your Costco membership to make the purchase.

For the man who’s dedicated to sculpting his body, this heavy-duty hyperextension bench offers five positions ranging from 45 to 90 degrees. It specifically targets abs, obliques, upper and lower back, and glutes. It also comes with a three-month Centr digital membership to get his workout off on the right foot.

If you’re hunting for the right gifts but want to find ways to save money, Costco is making it just a little easier this year.

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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.John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. Dana George has positions in Amazon, Apple, Target, and Walmart. The Motley Fool has positions in and recommends Amazon, Apple, Avalanche, Costco Wholesale, Target, and Walmart. The Motley Fool has a disclosure policy.

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It’s important to have your emergency fund in the right place. Find out if it’s a good idea to put your emergency fund in an investment account. 

Emergencies happen, and that’s why every adult needs an emergency fund. Once you have yours fully funded, it’s going to be a sizable amount. The most common recommendation on emergency funds is to save enough to cover three to six months of living expenses. If your essential bills cost $4,000 per month, the recommendation would be saving $12,000 to $24,000.

Considering the amount of money involved, you might wonder if an investment account is a good place for your emergency fund. Instead of having that money sitting around in a bank account, you could invest and grow it.

It sounds reasonable, but it’s not a good idea. Your emergency fund should never go in an investment account. While it could work out, there’s a serious risk involved.

Why you shouldn’t invest your emergency fund

Over long periods of time, investing is the best way to grow your money. The stock market, as measured by the S&P 500 index, averages an annual return of about 10% per year.

But that’s not a consistent, stable return. You can’t count on getting 10% per year like clockwork. Over short periods of time, the stock market can go up and down quite a bit. Your investments will do great some years and poorly in others. If you invest your emergency fund, the risk is that it could decrease in value before you need to use it.

Imagine that you had invested a $10,000 emergency fund at the start of 2022. You put it in an S&P 500 mutual fund. Unfortunately, the S&P 500 declined by 19.4% that year. Your emergency fund would have been worth a little over $8,000 at the start of 2023 — bad news if you had a costly emergency and needed to start withdrawing from it.

The purpose of an emergency fund is to protect yourself from financial emergencies. By having one, you reduce your risk of being in a tough position and possibly needing to go into debt. If you invest that money, you’re putting it at risk, which defeats the purpose of having an emergency fund.

Where should you put your emergency fund?

The best place for an emergency fund is a high-yield savings account. Here’s why:

Your money will be safe and insured. There’s no risk of your money losing value, like there is when you invest it. As long as you pick a bank with FDIC insurance, your deposits will also be insured for up to $250,000 per eligible account in the event of a bank failure.You’ll earn a reasonable interest rate. Rates fluctuate, but they’re high right now, especially with high-yield savings accounts. There are plenty of accounts with APYs of 4%, 5%, or more.You’ll have easy access to your money. If you have an emergency, you can just withdraw money from your savings account. Some savings accounts have withdrawal limits, normally of six withdrawals per month. That’s normally more than enough, but if you want to avoid this entirely, there are also savings accounts with no withdrawal limits.

You don’t need to worry about fees, either. There are plenty of savings accounts with no fees or even minimum balance requirements. If you’re looking for a good option, check out The Ascent’s list of the best high-yield savings accounts.

It’s great to think about ways to make the most of your money. But keep your emergency savings and your investments separate. Your emergency fund should be in an account where there’s no risk it will decrease in value, and where you can access it at any time. Your investment account is for money you know you won’t need for at least five to 10 years.

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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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Sam’s Club has some awesome toys to buy your kids this holiday season. Take a look at some of the best items to pick up. 

Buying holiday gifts for kids can be a huge challenge. After all, you want to find something that will delight your little darlings all year long, but you don’t want to empty your checking account doing it.

The good news is, Sam’s Club has you covered. You can find tons of great presents for kids of all ages there — including these awesome buys that won’t leave you with a big credit card bill.

1. An inflatable bounce house

Sam’s Club has a top-notch selection of bounce houses, with prices ranging from $179.98 for a simple house with slide all the way up to $599 for a deluxe inflatable obstacle course waterpark.

If you’re like me and you grew up at a time when your parents had to take you to a fair or lawn fete to get this kind of fun, you’ll know just what a bargain that is for the hours of entertainment these houses can provide. Sam’s Clubs prices also offer plenty to be excited about, as a similar bounce house and slide from Walmart comes in at $214.54.

The only remaining question for parents (well, for me at least) is what the age limit is for bouncing. With a 132-pound weight capacity on the entry-level model, I’m coming in under the wire on that at least, and I’ll be “testing” this one out myself before the holidays. Have to make sure it’s safe for the kiddos.

2. Lego Building Sets

Lego toys are educational and fun for kids of all ages. That’s why it’s so exciting that Sam’s Club has a great selection of them. From the Disney Pixar Up House for $48.98 to a Star Wars Spider Tank Building Set for $40.98, there’s a Lego set for enthusiasts of all skill levels.

And, again, the prices are competitive, with Kohl’s charging $59.99 for the same Up home.

3. Member’s Mark Preschool Playset

If your kids are still of the toddler variety, you’ll love the Sam’s Club selection of preschool playsets, including:

A farm life setA construction setA jetsetter setA country cottageA jungleA pirate ship

At $24.98 each, these items received an average of 4.7 out of 5 stars over 245 reviews, and they’ll provide endless hours of fun for the kids. Just be aware that you will need two AAA batteries to make the sound effects work, so don’t get caught unprepared on Christmas Eve without batteries.

4. Squishmallows slippers

We give our kids something they want, something they need, something to wear, and something to read for Christmas. If you do the same, or are just looking for a cozy Christmas gift, these Squishmallows slippers could be the perfect thing.

Squishmallows in general are super popular with kids — and it’s easy to see why with all their squishy goodness. These slippers for boys and girls in affordable patterns are sure to be a huge hit. Fortunately, they are also just $10.98, which would be a great price for any slipper, including one that doesn’t carry the famed Squishmallows name.

These are just some of the many great gifts Sam’s Club offers for kids. Check out what Sam’s Club has to offer to see if you can get your holiday shopping done on budget — and before you end up scrambling on Christmas Eve. Just don’t forget those batteries.

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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.Christy Bieber has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Walmart. The Motley Fool has a disclosure policy.

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Improving your credit score is easier than you might think. Here are three simple steps you can follow to build good credit in 2024. 

Good credit starts at a credit score of 670, and having it offers its fair share of benefits. You’re more likely to get approved for loans and credit cards if you have good credit. You’ll also be able to qualify for better offers, including loans with lower interest rates and the top credit cards with the most features. And that’s just the tip of the iceberg, as there are many other ways your credit score affects your life.

Nobody starts out with good credit, but anybody can get there. If you follow a few simple steps, you could build good credit in 2024.

1. Get a credit card (if you don’t have one already)

If you already have a credit card, you can skip this step. Otherwise, look for credit cards that fit your current credit profile. If you’re starting from scratch, or you have a low credit score because of previous issues, secured credit cards are often the best choice.

A secured credit card requires a security deposit to open. Many of them require a minimum deposit of $200 or $300, but there are also cards with lower minimums. The deposit is why these cards are easier to get. It provides the card issuer with some extra protection — if you don’t pay the bill, it can cover the losses with your deposit.

You might be wondering if you even need a credit card to build credit. You can also build credit with a loan, but credit cards are a better option.

With a loan, you need to pay interest. Loans also have a limited lifespan. With a credit card, you can avoid interest charges if you pay in full every month. That means you can build credit for free. And you can keep your credit card as long as you want.

2. Pay the bill on time every month

The biggest part of your credit score is your payment history. If your credit file is full of on-time payments, then you’ll likely have a high credit score. Late payments, on the other hand, do serious damage to your credit. They also remain on your credit history for seven years.

Pay your credit card bill by the due date every month. By the end of the year, you’ll have 12 on-time payments. That alone could be enough to get you to good credit. Also aim to pay your credit card bill in full every month. Paying on time is what’s most important for your credit score, but paying in full means that you won’t get hit with credit card interest charges.

Just so you know, payments that are less than 30 days late won’t hurt your credit score. Because of how credit reporting works, payments aren’t counted as late until they’re at least 30 days past due. It’s still best to avoid paying late at all. You can get charged a late fee as soon as your payment is late. But if you miss a payment, don’t panic. Get caught up right away before it counts against your credit score, and ask your card issuer if it will waive the late fee. Most will waive it the first time around.

3. Don’t charge more than 30% of your credit limit

The other key factor in your credit score is how much of your credit you use. It’s known as your credit utilization. If you use a large portion of your credit, you’re considered a higher risk. That means you’ll have a lower credit score.

Let’s say your credit card has a $1,000 credit limit. If it has a balance of $800 or $900, that will be bad for your credit score. The rule of thumb is to stay below 30% credit utilization. So, with a $1,000 credit limit, you’d want to keep your balance below $300.

This is harder when you’re starting out and your card has a low credit limit. It won’t be difficult forever, because as your credit score improves, you’ll get access to larger credit limits. Your card issuer may raise your credit limit automatically, or you can ask the card issuer to increase your credit limit. Once you have good credit, you could also qualify for high limit credit cards. With higher credit limits, it’s easier to keep your utilization low.

The amount of time it takes to get good credit varies. It depends on your current credit profile and what you do going forward. If you follow those steps, your score will build quickly, even if you’re starting from scratch.

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.

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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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