Money Management

There’s never been a better time to learn a new skill online. Here’s how MasterClass and Skillshare stack up to each other. 

The online learning market has taken off over the past few years, and one reason may be that developing a new skill can greatly increase your earning potential. Gallup data shows that workers who develop new skills can boost their income by an average of $8,000 annually.

Of course, you can learn something new for other reasons besides improving your personal finances. Fortunately, there are some great online learning resources out there, including MasterClass and Skillshare.

Here’s what each online learning platform offers, how they differ, and why you may want to consider a subscription.

Why you might want to choose MasterClass

MasterClass has created one of the highest-caliber platforms for online learning. The platform has a much smaller list of available courses than some other websites — it has more than 180 classes in 11 different categories — but they’re taught by celebrities and acclaimed instructors who are at the top of their professional fields.

For example, you can learn tennis skills from Serena Williams, screenplay writing with Aaron Sorkin, and jazz lessons from Herbie Hancock. Each course has about 20 videos that are about 10 minutes long.

There are three subscription levels — individual, duo (which includes two devices), and family (up to six devices) — which start at $120 per year. There isn’t a MasterClass free trial, but the platform has a 30-day money-back guarantee.

MasterClass says the subscription includes:

Unlimited access: You can view all the courses as many times as you want. Offline access: You can download the courses in the MasterClass mobile app for viewing later, but only if you have the duo or family plan.MasterClass Sessions: This feature adds additional step-by-step courses, feedback, an online community, and real-world projects you can work on.

Why you might want to choose Skillshare

Skillshare offers 25,000 video classes taught by 8,000 teachers. The platform has a lot of creative courses, so this platform may be right for you if you’re interested in learning a new creative skill, including illustration, writing, graphic design, and web development.

I recently wrote a quick overview of Skillshare and noted that the annual subscription for the platform was $165, but there’s currently a 40% discount on that price. You can also try out Skillshare for free for one month.

Skillshare says members receive several key benefits, including:

Unlimited access: You can view all Skillshare classes as much as you want.Hands-on learning: You can work on projects to test your skill knowledge and earn badges and certificates.Feedback: When you complete a project, you can add it to a gallery to get feedback from the instructors and other people in the course.Plan your learning: Skillshare offers a learning path to help you determine which courses will best help you learn your desired skills. Online community: You can connect with other people on the platform learning the same skills as you.Offline access: You can download classes to the Skillshare app to continue learning even when you aren’t online.

Which one is worth your money?

I usually hate reaching this conclusion, but in this case, I think both courses could be worth your money, depending on what you’re looking for.

If you want to boost some of your creative skills, or learn new ones, Skillshare may be better for you. With tons of classes, you’re bound to find something you’re interested in. And with its built-in community, instructor feedback, hands-on projects, and certifications, this might be a good option for people ready to learn a new skill.

On the other hand, MasterClass offers a lot of high-quality courses with world-famous instructors. Getting a glimpse into how these professionals work, hearing their own experiences, and learning tips from them could be invaluable to many online learners.

And with MasterClass Sessions, some of the courses have similar features that Skillshare offers, like submitting projects and getting feedback from the online community. Though it’s worth noting that if you sign up for a MasterClass subscription, you won’t get direct feedback from your favorite celebrities, sorry.

With Skillshare offering a free trial and MasterClass’ 30-day money-back guarantee, you really can’t go wrong trying out either (or both!) of these online learning platforms to learn a new skill.

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Home sales are plunging, but will that make it easier to buy? Not necessarily. Read on to see why. 

It’s fair to say that 2023 has not been a good year to buy a home. Not only has signing a mortgage become a very expensive prospect, but home prices are holding up at stubbornly high levels. Throw in a lack of inventory, and it’s a wonder anyone can navigate today’s housing market.

In September, existing-home sales fell more than 15% from a year prior, according to the National Association of Realtors (NAR), marking a 13-year low. And that sort of news might read like good news if you’re a buyer. After all, if fewer homes are being sold, it might mean that sellers are getting desperate. And if so, they’re apt to come down on price, right?

Well, not exactly. See, the reason for declining home sales isn’t a lack of buyer demand — it’s a lack of inventory. And until inventory picks up, buying a home is going to be difficult.

Why housing inventory isn’t increasing

There’s a reason housing inventory has been seriously lacking this year, and why it only sat at a 3.4-month supply in September, as per the NAR. Nobody wants to move.

It normally takes a four- to six-month supply of available inventory to meet buyer demand in full. So today’s housing market doesn’t come close from an inventory standpoint. But that’s understandable.

Many homeowners are sitting on record-low mortgage rates because they bought homes or refinanced in 2020 and 2021, when borrowing was extremely affordable. But seeing as how mortgage lenders are charging about 8% interest, on average, for a 30-year loan today as per Freddie Mac, it’s easy to see why current property owners are inclined to simply stay put, even if they can technically use their existing home equity to upsize.

Think about it: If you had a 30-year mortgage at 3%, would you really want to trade it in for a new loan at 8%? Probably not. So until mortgage rates come down, housing inventory is likely to remain low. And that means we could be in for many more months of declining home sales — not because people don’t want to buy, but because there’s simply nothing to buy.

How to find a home at a time when there’s limited inventory

You may be eager to buy a home as soon as possible. But unfortunately, if you’re looking for a home today, you need to be willing to make compromises. So be honest with yourself — are you willing to do that?

And if the answer is no, that’s OK. We’re talking about buying a home here, not a laptop you might keep for a year or two or a new coat you can always update next season. If there are things on your wishlist you’re just not finding anywhere, it’s perfectly OK to put off homeownership for a few more years, wait for mortgage rates to come down, and try again when inventory is hopefully more robust.

Otherwise, your best bet is to narrow down your wishlist to a few key items. Maybe you can have your attached garage and basement, but you can’t necessarily have a two-car garage and a finished basement. That’s just the way the market is today.

Of course, expanding your search radius might make it so you’re able to find an affordable home that checks off more boxes. But that’s a compromise, too.

All told, a lack of real estate inventory is a major problem right now, and the market is likely to stay that way for a while. There are things you can do to work around that, but if you decide to delay your home-buying plans, no one would blame you at all.

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Hard work can be a means to an end, even if you don’t enjoy it. Read on to find out why some old-school commitment isn’t such a bad thing. 

Years ago, I was trying to figure out what I was doing about a job I wasn’t too fond of. I wasn’t happy there and wanted to make a change, but I wasn’t sure how yet. I talked with some of my family, while my grandfather sat there listening.

After a few minutes of complaining about my job, there was a brief pause in the conversation, and my grandfather spoke up and said quietly, but firmly, “Well, you’re not supposed to like it.”

I was surprised to hear him say that about my job, and at the time, I thought that maybe he just had a different perspective about work than I had, which was true. But years later, I’ve also come to appreciate what he was trying to say even more.

Work isn’t always going to feel satisfying, and sometimes, it’s just a practical tool that we use to make money that we need.

What my grandfather was right about

My grandfather was a young kid while the U.S. was in the throes of the Great Depression. He grew up during a very tough economic time when jobs and money were scarce. My grandfather didn’t go to school for long, only finishing eighth grade before he stopped.

He then joined the Navy, entering just before WWII ended, and worked as an electrician at a power company for more than three decades before retiring. That job helped support his wife and five kids for many years.

So, when he told me, “You’re not supposed to like it,” he was speaking from a life of experience where his job was something he was proud of but probably wasn’t always something he loved doing. It was a means to an end that was satisfying in its own way — just not the same way most LinkedIn influencers talk about work satisfaction.

How this perspective has helped me with my finances

From time to time, I’ve reflected on what my grandfather taught me and how I can apply it to my personal finances to stay focused on goals.

For example, I’m paying off some credit card debt right now, which isn’t fun. There are other things I’d rather spend my money on, but I’m staying focused on paying it off. It’s a simple principle of slowly working toward a goal, even when the daily routine of it isn’t exciting. I’m also planning to buy a house, which takes even more financial restraint and long-term goal setting.

And when I was looking for a new job years ago, I read a lot of books and blogs and listened to podcasts that all recommended one thing: Don’t quit until you find something new. I didn’t have that option anyways, because I was providing for my family, but it reminded me that sticking some things out can certainly be worth the sacrifice.

The good news is that you don’t have to just buck up and get down to work. There are some great tools out there to make achieving your financial goals easier, including using some great budgeting apps.

Maybe you don’t need to change jobs or pay off debt, but if you want to save for a house, learn a new skill, or provide financially for people you love, it’s good to remember that it will probably involve some work you don’t love.

I did end up switching jobs to something I like much better, but I still think of my grandfather’s advice when I’m doing something I don’t prefer. I would just make one slight adjustment to my grandfather’s job advice and put it this way:

Sometimes, you’re not supposed to like it.

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You may have the goal of amassing a lot of savings. Read on to see why having too much money in the bank could backfire on you. 

Many people live paycheck to paycheck and have no money in a savings account to fall back on. And that, frankly, is far from an optimal way to live.

If you don’t have some cash reserves in the form of an emergency fund, you might instantly land in debt when an unexpected bill arrives. Similarly, if you were to lose your job, you’d likely end up with costly debt in the absence of savings.

That’s why it’s important to have an emergency fund with enough cash to cover anywhere from three months to a year’s worth of essential expenses. That’s a pretty big range, and you’ll need to assess your personal circumstances to decide which end to aim for.

If you’re single with minimal expenses, you may be okay with a three-month emergency fund. If you’re a single parent with a mortgage and three kids, you may want to aim for a 12-month emergency fund, as that could give you the protection and peace of mind you need.

Meanwhile, a recent CNBC survey asked respondents how much liquid savings they feel they need to be financially comfortable. And for 27%, the answer was $100,000 to $249,000. But for many people, that’s going overboard.

You don’t want to keep too much money in cash

You might think it’s a good thing to load your savings account with extra money. But let’s say you’re aiming for a six-month emergency fund and you spend $5,000 a month on essentials. That means you need $30,000 in the bank.

Now granted, you might spend more than $5,000 a month if you live in a high-cost area. The point, however, is that the typical consumer generally does not need a $100,000 to $249,000 emergency fund. And if you keep that much money in the bank, you might lose out financially.

Right now, it happens to be that savings accounts are paying generously — upward of 4% in many cases. But there was a time not so long ago when you’d be lucky if you even got 1% back on your money.

By contrast, over the past 50 years, the stock market has delivered an average annual 10% return, as measured by the S&P 500. So even with savings accounts paying so generously, you might still lose out financially by keeping too much money in cash.

Let’s say you really only need a $30,000 emergency fund, but you maintain a $100,000 balance instead. That’s an extra $70,000 in cash.

Let’s also go with today’s savings account rates and assume you’ll earn 4% on that $70,000 over the next 10 years. If so, you’ll be looking at around $104,000. But if you put that money into the stock market and score a 10% annual return instead, in a decade’s time, you could be looking at almost $182,000. That’s a $78,000 difference!

Don’t overfund your emergency savings

You may be inclined to take the attitude that it’s better to have more savings than less. And that’s spot-on. It’s far better to err on the side of overfunding your emergency savings than to not have enough cash to bail you out of a jam.

But unless you’re an ultra-high earner with large monthly expenses, you probably don’t need $100,000 to $249,000 in savings. A smaller balance could still provide the comfort and protection you need without forcing you to forgo more lucrative returns.

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Not everyone is eligible for an HSA. But if you are, it pays to take advantage. Read on to see. 

Most people are familiar with savings accounts. Health savings accounts, or HSAs, less so. But they’re a neat tool that could save you big time on taxes if you opt to participate, so it’s important to understand how HSAs work and what benefits they offer.

An overview of HSAs

An HSA is a special account you open to save for medical expenses. The money that’s contributed to an HSA goes in tax-free, so that’s an immediate benefit. For example, contributing $2,000 to an HSA means you don’t pay taxes on that much income.

Once you have money in an HSA, you can take withdrawals at any time. But if you don’t need your funds right away, you can invest your balance in the hopes of growing it into a larger sum over time.

Investment gains in an HSA are tax-free (unlike gains in a brokerage account, which you pay taxes on year after year). And HSA withdrawals are tax-free as long as that money is used for qualified medical expenses.

Are you eligible for an HSA in 2024?

One problem with HSAs is that they’re not available to everyone. Rather, you qualify based on the type of health insurance you have.

Your health plan needs to have a certain deductible for you to make contributions. In 2024, the minimum deductible requirement is $1,600 for self-only coverage and $3,200 for family coverage. Your plan must also have an out-of-pocket maximum of $8,050 for self-only coverage and $16,100 for family coverage.

If your plan meets these requirements, the HSA limits for 2024 are as follows:

$4,150 for self-only coverage if you’re under 55$8,300 for family coverage if you’re under 55$5,150 for self-only coverage if you’re 55 and older$9,300 for family coverage if you’re 55 and older

Should you open an HSA in 2024?

If you’re someone who doesn’t tend to spend a lot of money on healthcare expenses, then you may be inclined to forgo an HSA next year. But that could be a huge mistake.

See, you don’t have to take HSA withdrawals the year you make contributions. You can carry that money forward as long as you like — all the way into retirement, even.

You may not have huge medical expenses now, but as people age, their healthcare spending tends to go up. And so even if you don’t have a near-term need for an HSA to cover your medical expenses, you might really appreciate that pile of savings once you’re retired. So if you can afford to part with some of your income, you might as well fund an HSA for the near-term tax savings and the eventual benefit of having access to that money.

And if you’re still not convinced, think of it this way: Let’s say you contribute $1,000 to an HSA next year and don’t touch it for 30 years. If your HSA delivers an average annual return of 8%, which is a bit below the stock market’s average, you’ll grow that $1,000 into $10,000.

Also, you never know when you might suddenly get hurt or fall ill. So while you might think you don’t need a lot of money on hand for medical expenses, things could change in an instant.

All told, there’s not much of a downside to funding an HSA other than seeing a lower paycheck. If that’s something you can swing, then it pays to pump money into an HSA next year, even if it’s only a modest amount.

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The general rule of thumb is that you’ll spend about 80% of your current salary in retirement. Read on to find out what that means for your retirement planning. 

Putting a portion of your salary aside every month into a retirement account isn’t exactly easy sometimes, especially with inflation at elevated levels and housing costs up significantly compared to just a few years ago.

It doesn’t help that it could be difficult to calculate how much you’ll need in retirement, considering that no two retirement plans will look exactly the same.

But there are a few tried-and-tested approaches to coming up with a general amount you’ll need. So let’s take a look at how much you may want to save to maintain your current standard of living if you’re making $30,000 per year.

Consider the 80% rule

Most financial experts say that you’ll spend about 80% of your pre-retirement income to maintain the same standard of living in retirement. It’s not an exact science, of course, but it’s a good starting point to estimate the amount you’ll need.

So, if your annual income is $30,000 right now, then 80% of that is $24,000. This is roughly what you’ll spend to maintain a lifestyle similar to the one you have right now.

Deduct what you’ll get from Social Security

Most Americans are able to collect Social Security while they’re in retirement, so we should factor this into our equation as well. The general rule is that Social Security benefits replace about 40% of pre-retirement income.

With $30,000 in annual income, that means you could receive an estimated $12,000 per year in Social Security payments, without adjusting for inflation. Remember though, that this is a rough estimate. You can use the official Social Security calculator to enter your age, salary, and target retirement year, to get the most accurate estimate for you.

So if we take our previous $24,000 and subtract $12,000 from annual Social Security payments, then we end up with a remaining $12,000 that you’ll need each year.

How much you need to save

And finally, if we multiply that $12,000 by 25 (the estimated amount of years you’ll be retired), then we come up with a figure of $300,000 needed for retirement savings.

It’s worth repeating that this is just a hypothetical estimate and doesn’t include inflation-adjusted figures nor does it account for your specific lifestyle.

Start investing as soon as possible

No matter how much money you’ll need for retirement, putting money into a retirement account as quickly as possible is always the best strategy.

One good way to do this is to sign up for your company’s 401(k) program, if one is offered. And if your company offers contribution matching, make sure to contribute enough to qualify for the maximum match amount so that you can take advantage of free money added to your account.

You may also want to consider opening up an individual retirement account (IRA). You can do this through a stock broker, which will allow you to make your own investment decisions. You’ll also be able to choose whether you want a traditional IRA or a Roth IRA. Both have tax advantages, but the Roth IRA will allow you to make your retirement withdrawals tax-free.

These are just estimates

Remember that these are just estimates, and the amount you need in retirement may look very different. But this should give you a few ideas of how you should think about retirement planning and how much you might need to put into an investment account each month.

And remember that the longer your money is in a retirement account, the more potential you give it to grow. Time is your friend when it comes to compounding interest, so the sooner you start saving, the better.

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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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