Money Management

There’s one feature everyone should look for in a brokerage account. Read on to see what it is. 

There was a time when paying a commission every time you bought or sold a stock was common. But these days, most brokerage accounts offer commission-free trading, which can save investors a bundle.

In fact, you may be hard-pressed to find a brokerage account that still charges those fees. But it’s still important to choose your investment account wisely.

For example, you may want a brokerage that doesn’t impose an account minimum so you don’t have to worry about a lower balance. And you probably don’t want a brokerage account that charges inactivity fees, because there may be times when you go months without making any trades.

But when looking for a brokerage account, it’s important to prioritize one that offers the option to invest on a fractional basis. Doing so could be your ticket to building a diversified portfolio, even if you don’t have a ton of money to work with.

The importance of fractional shares

The concept of fractional shares is simple. Instead of having to buy a whole share of stock, you can buy a piece of a share if a whole share is out of reach financially, or if you don’t want to tie up so much money in a single share.

For example, let’s say you have $400 to invest, and you’re interested in owning a piece of a company whose share price is $400. That means that your portfolio will be invested in a single stock, and that’s not a good thing.

With fractional shares, you’d be able to buy, say, $40 worth of that company, or one-tenth of a share. That way, you could put your remaining $360 into a bunch of different companies.

The reason fractional shares are so important is that they make it easier to build a diversified portfolio when you don’t have a lot of money on hand. And a diversified portfolio could be your ticket to not only growing wealth over time but also avoiding losses during periods of market turbulence.

Let’s say you have a $400 portfolio that consists of two stocks only. If the value of those stocks declines substantially, your balance could shrink to $300 overnight. If those stocks are only two of 10 or more that you own, your portfolio balance might only drop to $350 or $360.

How many different stocks should you own?

There’s no hard and fast rule when it comes to the number of different stocks you should put into your portfolio. The Motley Fool recommends a portfolio of 25 stocks or more, so you can use that as a starting point.

In general, it’s a good idea to own, say, 30 to 40 stocks, because that’s a reasonable number to keep tabs on. You probably don’t want to own 130 to 140 stocks because that’s just too many individual companies to track.

But remember, when we talk about owning stocks, you don’t necessarily need to own whole shares. As long as your brokerage account offers fractional shares, you can invest in a healthy number of companies, even if you only have a few thousand dollars — or even just a few hundred — to work with.

You also don’t have to start out owning 25 stocks or more from day one. You can start with five or six stocks and build up over time. The point, however, is that fractional investing could make it easier to diversify, so it’s best to find a brokerage account that offers that option.

Our best stock brokers

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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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Your old iPhone could be worth hundreds of dollars, but its value varies drastically depending on where you sell it. Find out how to maximize its worth. 

Many of us know the simple joy of opening a new iPhone and spending time at work, er, I mean on the weekend, checking out its latest features. Apple upgrades its phone lineup each year, encouraging iPhone fans to regularly ditch their old device in exchange for a newer one.

Of course, with inflation still impacting the price of nearly everything (as well as iPhones being pricey to begin with), getting the most money for your old phone is always important. While each iPhone fetches a specific price based on its condition, carrier, and model, we can estimate how much some iPhone models may get through some trade-in programs and online marketplaces.

Remember, the better your phone’s condition, the more money you’ll get to add to your bank account. So maybe try not to let it plummet toward the coffee shop floor right before you upgrade.

1. Apple’s iPhone trade-in program

This program may not get you the most money for your iPhone, but it’s certainly an easy way to trade in your old phone. You can use Apple’s website to determine how much your phone will be worth while shopping for a new iPhone.

Once you pack up your phone and send it to Apple, the company will credit the amount toward your newly purchased iPhone or give you a gift card. The condition of your phone will be assessed after you send it to Apple, so the more accurate you are when trading in, the less surprised you’ll be with your phone’s eventual trade-in value.

Keep in mind that the trade-in amount may be more than the gift card amount. For example, Apple’s website says it will give up to $300 for an iPhone 12 trade-in, but if you choose a gift card, you’ll get $265. An iPhone 13 in good condition will fetch $420 when trading in or $415 for the gift card.

2. Swappa

You can think of Swappa as a fancy eBay. It’s a marketplace where you set the price for your device and can usually get more money than you would by trading it in at Apple. Swappa says its marketplace is for “newish” tech, so if you have a busted phone or one that’s not in tip-top shape, this site probably isn’t for you.

Swappa says the average price for selling an iPhone 12 on its marketplace is $403, and $568 for an iPhone 13.

In addition to selling your phone on the marketplace, Swappa offers the option to sell your phone to one of its buy-back partners. It’s a simpler process than selling it yourself, but you’ll make less money. The average price for an iPhone 12 trade-in is $231, and $401 for an iPhone 13.

3. Best Buy

If you browse the electronics section of Best Buy regularly, taking your iPhone to the store — or online — for an evaluation can be a good option. You’ll receive a store credit you can use toward a new phone…or that big-screen TV you’ve had your eye on.

A quick check on Best Buy’s website shows that the base 64GB iPhone 12 will earn you $275, and a 128GB iPhone 13 goes for $375.

4. Walmart Exchange

Walmart has its own exchange program it runs through CExchange. You can evaluate your device online and receive a prepaid shipping label to send the device to the company. Once it receives it and does a final evaluation, you’ll receive an electronic Walmart gift card.

Compared to the other trade-in options on this list, going through Walmart may give you the least amount of money. A base iPhone 12 with 64GB was worth up to $180 through Walmart’s trade-in program, and an iPhone 13 with 128GB was worth up to $272. Those values are far less than trade-in programs at both Swappa and Best Buy.

5. Carrier trade-in

Finally, trading in your iPhone through a cellphone carrier could be an excellent option to get the best money for your device. For example, T-Mobile is currently offering a trade-in deal to new and existing customers that may give iPhone owners up to $830 in bill credits when they turn in their old iPhones, if you sign up for a specific plan.

Additionally, AT&T has its own deal running right now where some iPhone owners could trade in their old iPhone and receive up to $700 toward an iPhone 14.

Carrier promotions change often, so you’ll need to look into some of the details before you’re ready to trade in your old iPhone to see if they apply. Also, carriers don’t hand out phones without some strings attached. You may need to sign up for a specific plan to get the most value from your old iPhone. Still, choosing a carrier’s promotion could mean your old phone is worth nearly as much as a new iPhone.

If you’re anything like me and you’re always looking for a way to improve your personal finances, getting a good deal on your iPhone is a great start. But scoring a low-priced smartphone plan is also a great way to save money every month. Here’s how I spend just $25 per month on my smartphone plan.

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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.Chris Neiger has positions in Apple. The Motley Fool has positions in and recommends Apple, Best Buy, Fetch, and Walmart. The Motley Fool has a disclosure policy.

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It’s safe to say that few people like owning up to their mistakes. Check out one writer’s financial blunders and what they learned from them. 

I can’t say I’m proud of my financial screw-ups, but I can’t imagine where I would be without them. As terrible as each situation felt at the time, those blunders are one of the reasons I’m good with money now. And because I’ve made so many mistakes, I’m far less judgmental toward others as they find their way.

I’m not done living yet, so I’m sure there are a few more financial modifications in my future. In the meantime, here are three of my most ridiculous belly flops.

1. Not fearing debt

Imagine this: It’s 1995 and I’m putting the finishing touches on a new home in Michigan. After years of being broke college students, my husband and I could finally afford to loosen the purse strings a little. And boy, did I ever let loose. I couldn’t pass a sale without buying something and had zero qualms about pulling out a credit card to buy whatever struck my fancy.

The reality of compound interest

The problem was, the average interest rate on credit cards in 1995 was 16%, and I had no trouble carrying debt from one month to the next. After all, we always made our payments.

Man, was that naive (or ignorant, foolish, short-sighted — insert your own adjective here).

Let’s say I spent $2,500 that December. If I made a $75 payment to my credit card company each month, it would’ve taken me 45 months to pay the card off. Worse, my $2,500 worth of purchases would end up costing $3,341 once interest was factored in.

What are the odds anyone remembers what I gave them for Christmas or how fabulous the dinner party was nearly four years later?

What I hope you do instead: I still use credit cards, but I pay them off in full before the monthly billing cycle is up. If you’re not doing this, it’s something to work toward. I can’t begin to tell you how much stress it will lift from your shoulders.

2. Having zero patience

It took me decades to develop patience. I couldn’t wait to move out of our starter home and into a big house we couldn’t afford. I couldn’t stand driving an old car, so I’d buy a new one before we were financially ready. I couldn’t even wait to adopt a puppy until we had enough cash to purchase pet insurance.

Every single time I’ve made a financial decision based on the idea that “I can’t wait,” it bites me in the butt. But I eventually learned that waiting can be exciting. I almost always enjoy fantasizing about our next vacation more than the trip itself, and have adopted the same mindset when I want to spend money we don’t have.

If there’s not enough extra sitting in our checking account to pay for something, I look at our budget and estimate how long it will be before the money is there. I don’t touch our investments or emergency savings accounts. I wait.

But it’s the wait I’ve come to enjoy. Just like planning for a vacation, planning for a new patio set gives me time to fantasize about what it will be like. I can’t tell you how many times I’ve been sure I wanted something, only to change my mind about what I wanted as I waited.

What I hope you do instead: If you have trouble delaying gratification, try a practice run. Think of something you want, then don’t buy it. Instead, save up. You may find you enjoy the dreaming part most.

3. Thinking I would never age

I suspect you’re sick of hearing about the importance of investing as soon as you get a job. I won’t pile on. I never felt a burning desire to invest for retirement when I was young and arthritis-free. And honestly, it’s one of my biggest regrets.

Because I waited for evidence that we all age, I’ve spent the past years playing catch up. That means investing far more than we would have needed to if I started earlier. Because such a large portion of our incomes now goes to retirement accounts, we’re not able to take all the trips we dream of or buy the classic car my husband has always wanted.

In other words, we’re living more frugally now because I spent like there was no tomorrow when I should have been investing.

What I hope you do instead: Starting now, I hope you’ll sock money away so that compound interest can do its thing. Consider this: If you were to invest $300 per month (roughly $10 a day) for the next 20 years, and that investment earned a realistic average of 7% annually, you would have approximately $148,800 extra. It’s not enough to retire on, but it is enough to add to your financial security.

Australian palliative caregiver Bronnie Ware wrote a book called The Top Five Regrets of the Dying, and interestingly, money was nowhere on the list. The five most common wishes people had as they neared death were:

That they’d lived life true to themselves rather than what others expected of them.That they hadn’t worked so hard.That they’d been courageous enough to express their feelings.That they’d stayed in touch with their friends.That they’d allowed themselves to be happier.

What I’ve learned along the way is that money doesn’t buy happiness, but it can help fund the things that do. For example, staying out of debt means not having to work so hard, and visiting loved ones is easier when you’ve saved enough money to cover the trips.

In the end, life is about the people we love and the lessons we learn. And let’s face it, mistakes teach us more than we’d like to admit.

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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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Anyone can save money by using more credit cards, but there’s a catch. Find out how to get the most out of your cash back cards. 

I’m saving hundreds of dollars this year by doing something simple: using more cash back credit cards at the places I shop most. I’d been putting it off. After all, I’ve used a single credit card my whole life. What if adding more backfired?

To address my fears, I started slow and did everything I could to make managing my credit cards easy. Ultimately, it worked out — I now earn four times the cash back on everyday purchases, thanks to better cash back bonuses on new cards.

But this strategy won’t be a fit for everyone. Here’s why it works for me, plus when it might work for the average American credit card user.

A three-step strategy for managing credit cards

I took a simple three-step strategy to manage my credit cards.

1. Target biggest spending categories

I targeted my biggest spending categories, starting with food delivery. I consulted my budget, and, wow, did I really spend $400 on DoorDash delivery last month? It turns out I did, and I still do. That makes it one of my most significant recurring expenses.

My Discover credit card only gave me 1% cash back on DoorDash purchases. So I applied for the DoorDash Rewards Mastercard®, which offers 4% cash back on DoorDash, plus other perks. I made that my default card for those orders, and just like that, I’d quadrupled my rewards on DoorDash.

After proof of concept (yep, I was paying less money), I did the same thing to cut down on monthly Amazon expenses. Once approved for the Prime Visa, I earned 5% back on my regular Amazon purchases. My spending remains consistent, but I now pay less than before.

2. Narrow card usage

Three credit cards can be a lot to juggle. So I narrowed card usage to the top cash back spending categories. I only use my DoorDash card for DoorDash purchases — likewise, I only use my Amazon card for Amazon purchases. That way, I can guesstimate monthly card payments.

Narrowing card usage has a side perk: I can track exactly how much I spend each month on DoorDash and Amazon, my biggest money dumps. Credit card statements track my spending.

3. Automate payments

I immediately set up automatic minimum payments on all three of my cards. That way, I don’t get punched in the credit score if I forget to pay a bill. Of course, I’d rather pay the whole bill — credit card debt is no joke. But automating minimums protects me from worst-case scenarios.

Automatic payments have saved my bacon more than once. It’s worth checking your credit card account to see if it offers this feature. At the very least, setting it up lowers your stress.

How much money do I earn?

Here’s the math: On DoorDash and Amazon, I spend an estimated $430 and $300 monthly. Taking into account the 4% DoorDash and 5% Amazon cash back rewards, I save $32 monthly. Over a year, I earn $384 in cash back rewards, excluding extra perks.

That’s fantastic for my wallet — it’s the equivalent to a month’s worth of groceries. But using credit cards is worth it only if I pay off 100% of my cards each month. Otherwise, I’m better off without them.

Should you use more credit cards?

Use as many credit cards as you can manage comfortably. The average American uses one or two cards. I’m a financial writer who thinks about money daily — I’m comfortable managing more than two cards, but many people aren’t. And that’s okay. (Using too many cards can be expensive!)

Knowing your financial limits — in this case, how many cards you can comfortably manage — is an excellent sign you’re on the path to financial freedom (or extending the road, so to speak).

Thinking about splurging on one of the best cash back credit cards? Consider targeting your biggest spending categories, narrowing card usage, and automating payments to make managing cards easier. And be sure to pay off your credit cards each month to avoid hefty interest payments.

READ MORE: How Many Credit Cards Should You Have?

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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. Discover Financial Services is an advertising partner of The Ascent, a Motley Fool company. Cole Tretheway has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Amazon.com, DoorDash, Mastercard, Target, and Visa. The Motley Fool recommends Discover Financial Services and recommends the following options: long January 2025 $370 calls on Mastercard and short January 2025 $380 calls on Mastercard. The Motley Fool has a disclosure policy.

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Debt consolidation could make your balances easier to manage and less costly to repay. Read on for some options for going this route. 

If you’re struggling with credit card debt, you’re not alone. The majority of U.S. consumers who use credit cards don’t pay off their balance in full every month, according to a recent survey by First Tech Federal Credit Union.

But there are steps you can take to make your existing debt easier to manage. And consolidation is one option that might not only save you time but money.

A good 38% of consumers have considered consolidating debt, as per the aforementioned survey. And if it’s an option you’re interested in, here are a few ways to go about it.

1. Apply for a balance transfer

If you’re juggling multiple credit card balances, you might qualify for a balance transfer offer. What might then happen is that you get to move your various balances onto a single card with a 0% introductory APR. Getting a reprieve from accruing interest might help you get ahead of your debt.

This could be a decent option to explore, but you must be aware of the potential pitfalls. For one thing, your 0% introductory rate will only remain in effect for so long. Often, those intro periods run out after 12 to 18 months, after which the interest rate on your debt could skyrocket. Also, there can be fees for moving a balance over, so read the fine print before moving forward.

2. Take out a personal loan

A personal loan lets you borrow money for any purpose. You can take out a personal loan and use your proceeds to pay off your various credit cards. Then, you’ll only make a single loan payment every month until you’re debt-free.

With a personal loan, you won’t qualify for a 0% introductory interest period like you might with a balance transfer. But the upside is that you may be able to lock in a lower interest rate on your debt with a personal loan compared to what you’re paying now.

Plus, personal loans offer the benefit of fixed interest rates. So you won’t have to worry about your debt payments rising over time, and you get to know when your final payment will be.

3. Sign up for a home equity loan

If you own a home you have equity in, you might qualify to borrow against it in the form of a home equity loan. These loans work similarly to personal loans and offer a number of the same benefits. You’ll get a fixed interest rate on your debt that results in predictable monthly payments, and your interest rate will likely be lower than what your credit cards are charging you.

The only thing to keep in mind is that if you fall behind on a home equity loan, you risk not just damage to your credit score, but also, losing your home. Serious consequences can ensue when you fail to make payments under a personal loan, too. But falling behind won’t necessarily mean putting yourself at risk of losing the roof over your head.

Consolidating debt often makes a lot of sense when you’re trying to keep up with multiple balances. Consider these choices carefully if you think debt consolidation is the right move for you.

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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.

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