Money Management

Tires are now 21.4% more expensive than they were two years ago. Find out if Costco Tire Center can help you get the best value. 

No, it’s not just you. Tire prices have gone up.

The average price of tires has risen 21.4% over the last two years, according to Michael Grabell from ProPublica. That would make a tire that cost $100 about $120 in today’s dollars, while a tire that cost $250 would now be $300.

To make matters worse, you can’t always plan for tire expenses. While a tire purchase could justify dipping into your emergency fund, if you don’t have one you might have to charge it to a credit card and risk carrying a balance.

Against this backdrop of inflation, Costco Tire might offer some relief. Its prices aren’t always the best out there, but when it’s offering promotions, you can save money and get great services. If you’re sick of tire expenses slowing down your personal finance goals, here are three perks to buying them at Costco.

1. Free installation

Costco recently eliminated its tire installation fees. Previously, it charged about $80 to install four tires, which is what most tire shops charge. Now, it’s free for tires purchased from Costco Tire Center. To underscore how significant this is, consider that both Sam’s Club and BJ’s charge $80 to install four tires, while Tire Discount will charge $88. If you don’t plan on installing your own tires, you could save about $80 right out the door just by buying them at Costco Tire Center.

2. Tire protection and maintenance

Most tires purchased and installed at Costco come with a free five-year roadside hazard warranty (some heavy truck tires may not qualify). Under this warranty, Costco will repair tires that have been rendered unserviceable due to cuts, punctures, or other non-repairable damage. To qualify, your tires have to be above a tread depth of 1.6 mm and must be properly inflated, as well as rotated and balanced regularly.

For comparison, Walmart sells a similar road-hazard warranty for $10 per tire. Discount Tires also sells a similar service, but the price is significantly higher and can swing wildly from as low as $100 to as high as $200 or more for four tires.

Additionally, Costco will also give you lifetime maintenance service for each tire. This includes tire rotations, air pressure checks, rubber valve stem replacements, and balancing. It will also fill your tires with nitrogen, not regular air. This could boost your gas mileage by slowing down the rate at which your tires lose pressure. Tire shops typically charge between $3 and $10 to fill tires with nitrogen, another cost to consider when comparing Costco to competitors.

3. Tire promotions

Finally, Costco frequently runs promotions on select tire brands. In the past, these promotions were often a combination of the manufacturer’s savings and a discount on Costco’s installation fee. Now that installation is free, the tire promotions have been the manufacturer’s discount only.

For example, Michelin is offering $50 off to Costco members when you buy four or more Michelin tires and spend $899.99 or less. For Michelin tire purchases above $900, you’ll get $100 off — $70 from Michelin and $30 from Costco (offer is through Oct. 22, 2023).

This is where buying tires at Costco can pay off. Getting $50 to $100 off could bring the price of tires well below that of other tire stores. If we then add in the other benefits — five-year roadside hazard warranty, free installation, lifetime maintenance, nitrogen — you could be getting the most value for the lowest price.

One potential caveat: Manufacturer’s promotions could restrict you to a brand that may not offer the lowest price for your car. For example, if you’re replacing tires on a 2022 Toyota Camry, you could pay roughly $783 for a full set of Firestone Firehawk tires. That’s the lowest price Costco is offering for your car. The cheapest Michelin tire for a Camry is the Pilot Sport All Season 4. After the discount, you would pay $891 — $108 more.

Should you buy tires from Costco?

When it comes to buying tires, comparison shopping will be the key to getting the best value. To be clear, best value doesn’t mean the lowest retail price on tires. You might find a $180 tire that Costco sells for $185, but when you add in Costco’s other perks (free installation and the 5-year roadside warranty), it might offer you the best value.

Still, it pays to shop around and compare Costco’s tires to other retailers, like Tire Discount and Walmart. You might not be able to stop inflation from making tires more expensive, but by being discriminating about where you buy them, you could do yourself a favor and get the best deal.

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

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Mortgage rates are really high right now. But will they drop over time? Read on to find out. 

There was a time not so long ago when you could sign a 30-year mortgage at or around 3%. But those days are long gone.

Right now, the average 30-year mortgage rate is 7.49%, according to Freddie Mac. And that means that it’s a pretty bad time to be refinancing a mortgage. By contrast, in 2020 and 2021, homeowners were clamoring to refinance their loans, so much so that mortgage lenders found themselves overwhelmed with requests.

If you own a home, you may be wondering if there will ever be a good opportunity to refinance a mortgage again. And the answer is, there should be. It’s just a matter of when.

Why are mortgage rates so high right now?

There are a few reasons why it’s so expensive to sign a mortgage today. For one thing, borrowing costs are up across the board following a string of interest rate hikes on the part of the Federal Reserve.

By raising its benchmark interest rate, the Fed can slow the economy on a short-term basis when inflation needs cooling. But higher short-term interest rates make it more expensive for banks and financial institutions to borrow money themselves, so they tend to pass that cost onto consumers to compensate. That explains why it’s more expensive to sign an auto loan, personal loan, or mortgage today.

But another reason why mortgage rates are soaring is that they tend to follow the 10-year Treasury bond. Right now, the 10-year Treasury is at close to a 16-year high. So it’s not surprising to see elevated mortgage rates.

Also, the economy is strong right now, and mortgage lenders are aware of that. Buyer demand is also strong. So lenders aren’t particularly motivated to lower their rates.

Things could change in time

Today’s economic conditions aren’t going to last forever. As such, today’s mortgage rates are apt to change over time. The big question is, when? And that’s not such an easy one to answer.

Ultimately, a sluggish economy could lead to a major decline in buyer demand, spurring a drop in mortgage rates. That’s not something any of us should be rooting for, but it’s a distinct possibility.

But also, the Fed is likely to cut rates as inflation continues to cool. That could take some of the financial pressure off of lenders, leading to lower mortgage rates. And of course the 10-year Treasury won’t always be as high as it is today, so that, too, could lead to lower borrowing rates for new buyers and homeowners who hope to refinance.

All told, there will very likely come a point in time when refinancing a mortgage will make sense again. It’s really just a matter of when. If you’re interested in refinancing, pay attention to economic conditions and rates to see when it pays to pounce.

But also, put yourself in the best position to come away a winner in a refinance by boosting your credit score, or maintaining your current score if it’s high to begin with. You can give your credit score a lift by paying all bills on time and keeping outstanding credit card balances to a minimum.

Checking your credit report a few times a year is also a good idea. You never know when yours might contain a mistake that works against you, like a delinquent debt you never actually fell behind on. Correcting an error on your report could result in a credit score boost so that when refinance rates do become more favorable, you’ll be in a great position to capitalize on them.

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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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Love Halloween? Read on to see how you can enjoy it to the fullest without spending a fortune. 

In my house, Halloween is a big deal. And it’s also not just a one-day event.

Rather, my kids spend weeks planning for Halloween. And we routinely decorate our front porch and lawn with spooky stuff during the weeks leading up to Oct. 31. We also commonly attend our share of pre-Halloween events, from town-sponsored trunk-or-treat gatherings to parties and pop-up experiences.

But last year, I spent more money than I intended to on Halloween, and I don’t want to make the same mistake again. And the reality is that a lot of people really can’t afford to go overboard on Halloween.

A recent SecureSave survey found that 63% of Americans don’t have the cash reserves to cover an unplanned $500 expense. Meanwhile, data from the National Retail Federation reveals that Americans are planning to spend a whopping $12.2 billion on Halloween this year. On a per-person basis, that’s $108.24.

Now, $108.24 may be a reasonable sum for anyone with a solid emergency fund to spend on the holiday. But if your savings account is almost empty, then you may want to do what you can to pull off a fun Halloween as inexpensively as possible.

Heck, even if you’re doing fine savings-wise, you may not want to blow half of your paycheck on Halloween this year. And that’s understandable, too. With that in mind, here are a few ways you can enjoy Halloween without spending a fortune.

1. Make your own costume

Most years, I end up spending between $25 and $40 on kids’ costumes. And that’s $25 to $40 each.

Clearly, that’s a large amount of money for something your kids might only wear once or twice. So if you’re willing to get creative, you might manage to whittle your costume spending down to $0 by utilizing items you already have at home.

If you have a bunch of black clothing and an old black t-shirt you’re willing to part with, voila — you’ve got yourself a Grim Reaper costume. Just have your kids wear all black and use scissors to convert an old black t-shirt into some sort of face mask. It doesn’t have to be perfect — your kids will get their candy regardless when they knock on doors.

Want a costume that’s more upbeat? Any frilly dress can serve as a princess costume. And you may be able to find a super-cheap tiara at your local dollar store to complete the look.

2. Buy low-cost candy at Costco

Have a Costco membership? Halloween is a great time to put it to good use by buying your candy in bulk.

A 90-ounce bag of assorted chocolate miniatures costs $22.99 online. That’s just $0.26 per ounce. And in-store prices tend to be even cheaper.

By contrast, a 29.5-ounce bag of candy at my local supermarket is $12.99 right now, which translates to $0.44 per ounce. Chances are, buying your candy at Costco will be less expensive than buying it at your local grocery store, too.

3. Skip the expensive pre-Halloween events

In my area, you’ll see a bunch of Halloween events and activities pop up in the weeks leading up to the holiday — things like haunted hayrides and so forth. These activities are no doubt cute. But they’re also horrendously expensive.

In fact, I remember once paying $40 per person — including kids — to walk through an outdoor area with ghosts and lights and a bounce house. Yes, my kids got to trick or treat and bring home a bag of candy. But at $40 a pop, that was a one-time splurge for my family.

If you’re looking to cut down your costs this Halloween, skip those overpriced events and focus on actual Halloween. You can also see if there are free or low-cost events in your area.

My town, for example, sponsors a trunk-or-treat event the weekend before Halloween. Residents volunteer to set up their cars and give out candy. Participants are asked to donate candy to residents who sit there in their cars all afternoon. I commonly donate a couple of small bags of candy for $3 to $4 each, and my kids have a great time walking around and checking out the different trunks.

Halloween has the potential to be a very expensive holiday. But you don’t have to resign yourself to spending a ton of money, especially if you don’t have a whole lot of it to go around.

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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 no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Costco Wholesale. The Motley Fool has a disclosure policy.

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