Money Management

I’m going to be purchasing a home soon. Keep reading to learn why I’m not ruling out a fixer-upper. 

I have been in the process of trying to buy a new home for several months, thus far with no success. As a result of the difficulties I am facing — despite being pre-approved for a mortgage loan and having a down payment ready to go — I’m thinking of buying a fixer-upper. Here’s why this is something that’s now on my radar when it wasn’t before.

1. Fixer-uppers are priced lower

Fixer-uppers in my chosen neighborhood are generally priced well below the cost of buying a new home. That’s to account for the fact that renovations will be necessary.

To figure out what the finished price of my fixer-upper would be, I looked at how much I would have to pay for the house plus the renovations — then added an extra 10% to account for any unexpected costs that might come up during the remodeling process.

Even after adding in the likely renovation costs, I found that I could get a house that needs repair (and then fix it) for less than it would cost me to buy a brand new comparable property. This meant that the fixer-upper would be better for my pocketbook.

It was especially attractive to me to buy a lower priced fixer-upper because most of the comparable properties that were ready to move into in my chosen neighborhood were actually priced above the amount I wanted to spend. So, without buying a home in need of repairs, I might have been priced out of where I wanted to live.

If you’re on a tight budget, you also may be able to find a house in need of remodeling for less than the cost of a new home. If this can help you get into a neighborhood you want at a comfortable price point, then it may be worth looking into. After all, the old adage is that you should always buy the worst house in the best neighborhood and buying a fixer-upper is a way to do that.

You will want to make sure you understand how much the fixes will cost though, and factor that in when you consider your out-of-pocket spending. If you can buy the home and do the remodeling for less than the cost of getting a mortgage for a house in the same location that’s already remodeled, you will end up better off than if you bought a finished home that needed nothing.

2. I can pay for renovations over time

One big benefit of buying a fixer-upper property is that I can finance renovations over time. If I pay for a perfect, updated house, it’s going to cost more so I have to borrow all the money I need to buy it at once. But, if I buy something that’s cheaper due to its issues, I can correct them as I get money and pay cash for the upgrades.

If you want to keep your own mortgage costs down, this could be a great technique for you as well. You can keep your initial investment down and save up over time to make changes to the home. If you can do some of the work yourself, you can also reduce renovation costs so you will end up spending less by saving on interest and because you won’t be paying as much to bring the house up to your standards as you would to buy a finished home.

3. I can personalize the house to my style

Finally, the last benefit of buying a fixer-upper is that I can renovate it to the style I like. If you want to make a home of your own, it may make little sense to buy a perfectly finished house. After all, you aren’t going to tear out a brand new, nice-looking kitchen just to put in one you think is prettier.

If you don’t like the idea of designing your own space, you may prefer to have a house you don’t need to make any changes to.

Ultimately, my reasons for buying a fixer- upper may extend to others as well. If you can’t find a house in your preferred location on your budget, if you would prefer to design a house to your specifications but don’t want to build a new one, or if you want to keep your upfront borrowing costs down, you may want to look for a home in need of remodeling.

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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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Bringing a child into the world? Read on to see why this specific financial move is so important. 

Being a parent changes you — there’s really no question about it. Suddenly, you’ve gone from only having your own needs to think about to having to care for another human being.

A lot of people make financial changes after bringing kids into the world. Some cut their spending to boost their savings account balance. Others put better health insurance coverage in place. And in a recent Policygenius survey, 23% of parents say they purchased life insurance as a result of having children. If you have kids but you don’t yet have life insurance, you may want to follow their lead.

Make sure your children are protected financially

Your children might be at an age where they depend on you for things like food and personal care. But it might take a really long time until your kids are old enough to fend for themselves financially. And so it’s important to put life insurance in place so your kids are protected in the event that you pass away before they’ve entered the working world.

Also, to be clear, it’s important to get life insurance when you have kids even if you don’t work. A lot of parents stay home when their children are young and take a break from their careers. But even in that scenario, buying life insurance makes sense.

While you may not have a salary to replace, if you were to pass away, leaving your surviving spouse to care for your kids and earn a living, that could get burdensome (and in some cases, it’s just not feasible to work and look after young kids at the same time). Buying life insurance could leave your spouse with enough money to pay for child care (and other household help) so they can continue to hold down a job.

How much life insurance do you need?

Calculating the amount of life insurance you need can be a little tricky, but a good rule of thumb is to try to replace about 10 times your income plus cover any outstanding debts you have. So if you earn $60,000 a year and you also owe $150,000 on your home, you may want to consider a life insurance policy worth $750,000.

If you don’t work, you may want to calculate the cost of child care and other help your spouse might need in your absence. So if annual child care costs for your two kids amounts to $30,000 in your area, and you’d need full-time child care for at least three more years, that’s $90,000 right there.

But you’d probably want to pad that number to account for inflation, and also to give your surviving spouse more financial breathing room, such as if they need to hire a housekeeper. So a $200,000 policy wouldn’t be unreasonable.

As far as the length of your coverage goes, a good bet is to put term life insurance in place that lasts until your kids are old enough to hold down jobs. You could also get a whole life insurance policy for permanent coverage, but those could be prohibitively expensive.

If you’re going to go with a term life insurance policy, assume your kids will be able to start working in their early 20s. So if they’re now ages two and four, a 20-year term life policy should suffice.

Having children is a life-changing event. But make sure you’re doing your best to protect your family financially by putting life insurance in place.

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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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Amazon’s virtual healthcare service, Amazon Clinic, is now available to adults in all 50 U.S. states. Find out how much the average user will pay for care. 

Last November, Amazon introduced its new telehealth endeavor, Amazon Clinic. The service provides convenient, affordable telehealth solutions to users. Earlier this week, the online retailer announced that the service has since expanded and is now available in all 50 U.S. states and Washington D.C. More people can now seek virtual care for common health concerns. Could this telehealth service save you money on healthcare costs? It’s possible.

Get virtual care for more than 30 everyday health needs

Customers can get virtual care for more than 30 common health concerns through Amazon Clinic — including asthma, urinary tract infections, dandruff, migraines, emergency contraceptives, and seasonal allergies. Adults ages 18 to 64 who are located in the U.S. can use this service. Video-based visits are available nationwide, and message-based consultations are available in 34 states. Clinician support is available 24/7.

Here’s how to use Amazon Clinic:

Visit clinic.amazon.com and choose a condition.Choose whether you want message-based or video-based support (message-based visits aren’t available in all areas).Choose one of the available telehealth care providers.Fill out the intake form to give more information about your health concerns.A clinician will reach out to schedule a video call, or if you choose a message-based visit, they will message you after reviewing your responses.Your clinician will provide a personalized treatment plan and, if necessary, will send a prescription to the pharmacy of your choice.After you receive your treatment plan, you’ll have 14 days to message your clinician with any follow-up questions at no additional cost.

Amazon Clinic doesn’t take health insurance. Instead, prices are listed for each available online clinic, and customers can review costs and choose the one that meets their needs. As you might imagine, message-based visits are cheaper than video-based appointments.

Could you save money using Amazon Clinic?

It’s no secret that healthcare in the United States is very costly. You’re probably wondering if Amazon Clinic can help you keep more money in your checking account. Prices vary, so there is no set price for care. But many people will likely find this service affordable. Amazon notes that, on average, message-based consultations cost $35, and video-based visits cost $75.

While health insurance isn’t accepted, customers can use their flexible spending account (FSA) or health savings account (HSA) dollars to cover the cost of their visit. All major debit cards and credit cards are also accepted for payment. If you need care quickly, or if you want to avoid paying a pricey co-pay to visit your primary care doctor in person, this could be an affordable, alternative solution to consider.

This could also be an excellent solution for those without health insurance. Some people rely on walk-in clinics and urgent care centers for their healthcare needs. These clinics often have long waits, and a visit can cost more than $100 without insurance. MedExpress notes on its website that while prices vary, self-pay patients can expect to pay anywhere from $149 to $249 for care.

For many people, Amazon Clinic could be a more affordable healthcare option. The added benefit of using a telehealth service is that you don’t have to leave your house to get medical care. You may want to consider using a service like this to save money on healthcare costs. Knowing you can get necessary health care without ignoring your personal finance goals is helpful.

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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. Natasha Gabrielle has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Amazon.com. The Motley Fool has a disclosure policy.

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Owning a condo comes with restrictions and fees. Keep reading to learn how to decide whether a condo might be right for you. 

Buying a condo can be a great way to get on the property ladder — especially if you don’t want all of the maintenance and expense associated with buying a house or if you live in an area where condos are cheaper or more plentiful.

But condo living isn’t for everyone. Before you jump into getting a mortgage to purchase one, there are a few key questions you need to ask yourself to ensure this type of property is right for you.

1. Are you OK with having neighbors close to you?

Condo owners tend to live in closer proximity to their neighbors than people who own either a townhouse or a single family home. In fact, the experience of living in a condo building can be more similar to the experience of living in an apartment. You are likely to have neighbors both above and below you, and your building may have many units depending on the type of condo you select.

Having a lot of neighbors close to you can have pros and cons. You may make friends with those around you, your kids may have tons of other young people to play with, and there may be plenty of people around to socialize with. On the other hand, you may not like the people around you, or you may be bothered by the noise and the absence of privacy.

You’ll have to think about your personality and preferences when you decide if a condo building is a place where you would feel comfortable living.

2. Do you know the condo association rules, and can you live by them?

Condos have associations, and there are almost always rules and regulations you are going to have to follow and that the association is going to enforce. You may not be allowed to do a short-term lease in your condo, for example. You may be limited in the number and type of pets you can have, and may even have restrictions on changes you can make to the condo you own.

You need to be OK with living by whatever requirements the association imposes, as you’re not likely to be able to change them, and there can be penalties for violations.

3. Are you OK with paying all the fees you could owe as a condo owner?

When you own a condo, you will typically incur monthly maintenance fees. These costs are intended to help pay for shared amenities and the upkeep of common spaces. But they may not be the end of the expenses that you could be responsible for.

In some cases, if a condo building must complete a big project — such as replacing the roof — you will get hit with special assessments. This is an especially big risk if you buy in a condo building that doesn’t have a large reserve fund (or that doesn’t have a reserve fund at all).

These added fees can be very expensive, so you’ll need to understand when and how your building could charge them, how likely it is you’ll owe based on the size of your building’s reserve fund, and whether you have the room in your budget to cover them.

By asking yourself these three questions and taking these issues into account, you can make certain you won’t regret your condo purchase.

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Our experts vetted the most popular offers to land on the select picks that are worthy of a spot in your wallet. These best-in-class cards pack in rich perks, such as big sign-up bonuses, long 0% intro APR offers, and robust rewards. Get started today with our recommended credit cards.

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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