Money Management

A joint brokerage account shows you if you’re on track with shared investing goals. Keep reading to learn why getting one might (or might not) be a good idea. 

When you are married, you and your spouse will have to make a number of financial decisions about how you combine your financial life. For example, you may need to decide if you’ll have a joint bank account or if you’ll share a credit card.

You’ll also have to decide if you should open a joint brokerage account or not. There are pros and cons to sharing an investment account and you should consider both when you make this choice.

Pro: You can work toward shared goals

If you and your spouse are saving together for a long-term goal, such as early retirement, then it can make sense to have a joint brokerage account to open the door to do that. You can both put money into it, which will help the balance grow faster. You will also be able to track your progress more easily if you are both investing in the same account rather than maintaining multiple separate accounts.

If you are sharing an account, it’s also easier to encourage each other to contribute more in service of your shared objectives.

Pro: You can make sure you have a good overall asset allocation

When you invest, you need an appropriate mix of different assets in order to reduce the risk of loss. For example, you don’t want to be too heavily invested in one company, or even in one industry or part of the economy. If your money is too concentrated in one particular type of investment, you face an elevated risk of loss.

You also need to make sure you have a good mix of different assets given your age and investing timeline. For example, you don’t want to be too heavily invested in stocks if you’ll be relying on the invested money soon.

If you and your spouse have different brokerage accounts, it’s harder to see if you collectively, as a couple, have the right investment mix. Since you two are a financial team, it’s helpful to look at your shared pot of money and check that you have the right asset allocation. If you each have funds in separate accounts, it’s easier to miss the fact that you may be over-invested in a particular asset.

Con: You are limited in the types of joint investment accounts you can open together

One big downside of having joint brokerage accounts is that you are limited in what kinds of accounts you can open. For example, you typically cannot open a joint IRA account — you would each need your own.

So, unless you have a taxable brokerage account with a broker that allows it, having a joint account may not be possible.

Con: You’ll have to make investing choices together, which could lead to more conflict

Finally, if your money is pooled in one big account, you’ll have to work together to decide how to invest it. This could lead to more conflict, especially if you are each used to investing independently and managing your own money.

Ultimately, you should carefully consider these pros and cons when you decide what’s best for your needs. You may decide to have a joint brokerage account and some individual accounts as well, and that can work in the right circumstances too.

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Costco Business Centers sell bulk quantities of food, janitorial supplies, and industrial equipment. Learn how much you can save by shopping there. 

Costco members may not know that the warehouse retailer has a separate branch of Costco stores dedicated to small business owners. Dubbed “Costco Business Centers,” these warehouses look and feel like a regular Costco warehouse but sell business merchandise you wouldn’t find there.

If you have one of these Costco stores near you, you might be wondering if it’s worth buying business merchandise there. Let’s take a closer look at who these stores are designed for and what you can expect when you shop there.

Who should shop at Costco Business Centers?

According to Costco, it’s Business Centers might be ideal for the following small businesses:

Convenience storesHotel and motelsProfessional offices (such legal, medical, or accounting)Restaurants and cateringService stationsVending machine operators

But this list isn’t exhaustive. For instance, if you own a fitness or yoga studio, you could give your credit card a break by buying sanitary and janitorial products in bulk. Even if you run a charity or nonprofit, you could benefit from shopping at a Business Center, especially during fundraisers or events when you need to feed numerous people on a strict budget.

You don’t even need a small business to shop there. Anyone with a Costco membership — Gold Star or Executive — can buy goods at Business Centers. While you won’t find certain Costco products — particularly clothes, bakery items, toys, jewelry, and small domestic appliances — you might find better deals on your typical grocery purchases.

What can you find at a Costco Business Center?

When you walk into a Business Center, it’ll feel like your typical Costco warehouse, only slightly smaller and less crowded. You won’t find a bakery or middle section with what my spouse calls “mystery items” — seasonal products, clothes, sporting goods, and the occasional gazebo — but instead industrial equipment like reach-in freezers, countertop fryers, and hot food serving tables.

On its Business Center page, Costco lists items from the following categories:

BeveragesCandy and snacksCommercial appliancesDisposablesGroceriesJanitorial suppliesOffice suppliesRestaurant equipment and supplies

Most of the beverages, candies, and groceries will be sold in massive quantities that would be too much for the average consumer, such as 50 pounds of pinto beans or three pounds of crushed oregano, but perfect for restaurants or restocking vending machines and convenience stores.

You can look through the Business Center’s website or supply list to get a better idea of what these stores sell. But to really get the creative juices flowing, I recommend visiting one in person first, as you might not realize the full extent of what they sell until you see one for yourself.

Do the Business Centers deliver?

Most Business Centers will deliver to ZIP codes within the metropolitan area that it serves. Currently, these areas are limited to the following cities:

AnchorageAtlantaChicagoDallasDenverHoustonLas VegasLos AngelesMinneapolis-St. PaulOrlandoPhoenixRenoSacramentoSalt Lake CitySan DiegoSan FranciscoSan JoseSeattleTacoma

Keep in mind that Costco charges slightly more when you buy things online versus in store. For Business Centers specifically, you’ll also pay a $25 surcharge for orders under $250.

Should you shop at a Costco Business Center?

It doesn’t hurt to compare Costco’s prices with whoever is supplying your small business right now. Even if you have a good deal on recurring expenses with your current vendor, it might be worth a $60 membership if you can buy restaurant or industrial equipment for a low price.

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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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When multiple cars get into a collision, reporting the crash is important so insurers will be able to determine who is to blame. Find out more. 

After a car accident, there may be times when drivers aren’t sure if they should report the collision to their auto insurer or not. Reporting a crash can have undesirable consequences, including an increase in insurance premiums.

If the collision was a minor one, and especially if the at-fault driver promises to pay personally for any damages out of their savings account, it’s tempting to try to avoid the hassle and potential expense. In reality, though, in any multi-vehicle accident, it’s always critical to report the collision to an auto insurer. Here are a few reasons why.

The damages may be more serious than they appear

The biggest reason why it’s important to report any multi-vehicle accident to an insurer is because the crash may turn out to have caused more damage than initially expected.

For example, a driver who was in a rear-end crash may assume they just have a minor stiff neck after the accident. But, whiplash symptoms may appear days or even weeks after the accident and sometimes have lasting consequences that require extensive treatment or interfere with the ability to work. Other types of injuries could also have a delayed onset, or what seems like a small medical issue could turn out to be a much bigger one if recovery doesn’t occur as planned.

Likewise, a crash that appears to have caused minor property damage could turn out to actually have done serious damage to a car — perhaps even resulting in the vehicle being totaled if the expenses associated with repairing it turn out to be greater than the market value of the car.

If an accident turns out to have caused more serious damage than expected, plans to pay for it out of pocket may not come to fruition. The driver who expected to pay the damages might simply not have enough money. And if the crash was not reported to insurance in a timely manner, recovery may be more difficult or even impossible depending on the circumstances.

Both the victim and the at-fault driver suffer in this situation, as the victim may not get full compensation or the at-fault driver could find themselves being personally sued for damages.

Drivers may not follow through on their promises

If the crash was caused by another driver and they promise to cover the costs for victims if they don’t report it to insurance, the sad reality is that this is a very high risk situation for those impacted.

If the at-fault driver doesn’t follow through on their promise to pay — either because they can’t or because the damage is more extensive than expected — victims may not be able to turn to their own insurance company if the accident wasn’t reported.

Normally, their insurer would help them to recover damages or even pay for their losses through their underinsured or uninsured motorist policy if the driver responsible for the crash had insufficient coverage. But that opportunity may be gone.

There’s no reason to ever take a chance on whether a crash is reported or not. Both crash victims and at-fault drivers should alert their respective auto insurance companies right away — either so they can make sure they get the payment they expect or so they don’t find themselves being sued and paying large bills their insurance won’t cover.

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Buying a home is difficult enough these days. Read on to learn why some homeowners are also having trouble getting insurance. 

Anyone who thinks it’s an easy time to buy a home is clearly not paying attention (perhaps they’ve been living under a large rock?). According to the National Association of Realtors, there was only a three-month supply of homes for sale in May, and it generally takes at least a four-month supply to allow for a balanced market.

In addition to fewer homes for sale, buyers also have to contend with higher mortgage rates that are a far cry from the salad days of 3% rates in 2021. As of this writing, the average rate for a 30-year fixed-rate mortgage loan is 6.71%, per Freddie Mac. Ouch.

Let’s say you manage to find a home to buy, and can manage your mortgage payments, even with a higher interest rate. You’ve still got to buy homeowners insurance for your new home. But this might be a difficult prospect, depending on where you live.

Climate change is making home insurers think twice

We can no longer pretend that climate change is fake, or some far-off threat — it is here, it is real, and it is already impacting Americans from all walks of life and in all parts of the country. The National Oceanic and Atmospheric Administration (NOAA) has a division called the National Centers for Environmental Information (NCEI). This body tracks weather and climate disasters, and data collected shows that severe weather is on the rise in both number of events and severity. As of June 8, 2023, there were already nine confirmed events that exceeded $1 billion in damage each. These include flooding events, severe storms, and even a winter storm.

It’s really no wonder that some home insurance companies are noping out of offering coverage in some parts of the country. As an example, one of the nation’s largest insurers, State Farm, has decided to pause on writing new homeowners policies in the state of California. California is at high risk of wildfires, and State Farm has stopped selling policies to preserve its financial standing, as these claims are expensive. The costs of rebuilding and replacing homes has also increased dramatically, rising 55% between 2019 and 2022, as reported by CNN.

How is this impacting consumers?

Homeowners insurance is an absolute requirement if you’re purchasing a home with a mortgage loan, which makes a great deal of sense — lenders want to be sure the home they loaned you money to buy will be protected. But even if you bought your home in cash or paid it off, you still shouldn’t forgo homeowners insurance. Having to repair or rebuild your home after a natural disaster would be catastrophic for your finances.

If you buy a home in an area prone to costly natural disasters, you might struggle to find affordable insurance to protect your home. The costs of homeownership include more than just your mortgage loan, of course, and include insurance. But ideally, you’d want to keep those costs to less than 30% of your monthly take-home pay to ensure you don’t fall behind and put yourself at risk of becoming house poor, or even losing your home altogether.

What can you do?

If you’re worried about affording homeowners insurance in the face of rising costs and increased risk of damage from natural disasters, here are a few moves you can make:

Reconsider where you live: Nowhere is completely safe from the effects of climate change, but some areas of the country are better than others. If you have no physical reason to live in a potentially dangerous location, be it due to risk of wildfires, flooding, tornadoes, or any other severe weather or disaster, consider buying a home in a different place. It’s heartbreaking to consider, but these are the conditions we’re living with now.Turn to your state: Many states have property insurance plans called FAIR plans. These are available to individuals and businesses who are unable to get coverage in the regular insurance market. Unfortunately, they are more expensive and may have more limited coverage than regular insurance policies.Skimp selectively: To save money on an already-costly insurance policy, you might reduce coverage on outbuildings, such as your garage, or the contents of your home. You could also raise your deductible. This would save you money on your premiums, but you’d have to pay for any damage you incur below the deductible amount.Shop around: In buying insurance, as in most personal finance matters, homeowners may be able to save by checking prices with multiple insurers.Be proactive about protecting your home: My colleagues here at The Ascent have covered ways to protect your house against different disasters. Read about how to prepare for hurricane season. And check out how to ensure your home isn’t as vulnerable to wildfires.

The rising costs of home repairs and insurance and an increasing number of natural disasters have teamed up to make life harder (and more expensive) for homeowners, especially those in areas most at risk from climate change. If this is you, buckle up and do your best to keep your existing coverage — or find the best deal for new coverage.

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Your personal loan payments will be determined based on a few different factors. Read on to learn which ones. 

When you take out a personal loan, you are going to have to consider both how much your monthly payments will be and what your loan is going to cost you over time. Thinking about these issues will help you determine if the loan is affordable and if it makes sense for your finances.

There are three primary factors that impact the amount you will end up paying for your personal loan. Here’s what they are.

1. The amount you borrow

The amount of money that you borrow plays a huge role in how much you pay each month and over time. Obviously, the higher your loan balance, the larger the monthly payment that will need to come out of your checking account — and the more total interest you will pay over time.

Say, for example, you borrow $5,000 at 10% for five years. Your monthly payment would be $106 and total interest paid would be $1,374.11. But if you upped the amount you borrowed to $10,000, your payments would go up to $212 and total interest costs would climb to $2,748.23.

Since the amount you borrow has such a big impact on what you pay each month and over time, you should try not to borrow any more than you absolutely must to accomplish your goals.

2. Your interest rate

Interest rate also impacts the monthly payments and total costs you’ll face when you’re repaying your personal loan.

Remember the example above of the $5,000 loan at 10%. If that loan was instead at 5%, your monthly payment would be $94 and total interest paid would be $661.37. If it was at 15%, though, you’d be looking at a $119 per month payment and total interest costs of $2,136.98.

Since interest rate changes also have a dramatic effect on costs, it’s worth trying to get the best rate you can. You should shop around with different lenders to try to make sure you’re being offered an affordable loan.

If your credit score isn’t great, you may also want to try to find a cosigner who is willing to guarantee your loan as this could help you qualify for a more affordable loan. Remember your cosigner would be responsible for the debt if you don’t pay, so be sure you’re 100% committed to covering loan payments if you take this approach.

3. Your loan repayment term

Finally, the length of time you pay on your loan will also affect both monthly and total costs. If you changed the repayment term on your $5,000 loan at 10% to being repaid over 10 years instead of five, your monthly payment would be lower at $66 per month but total interest over the life of the loan would be much higher at $2,929.04.

Try to choose the shortest payoff time that comes with affordable payments so you can keep total borrowing costs down.

Ultimately, you should consider all three of these factors so you can make the right choice about which loan is best, given both total borrowing costs and the amount you’ll have to pay each month.

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Inflation could persist for a while. Read on to see what that could mean for your savings account. 

In May, annual inflation, as measured by the Consumer Price Index (CPI), came in at 4%. That’s a vast improvement from June 2022, when the CPI came in at 9.1% on an annual basis. But it’s also still higher than the 2% inflation the Federal Reserve has long sought to target. It’s this level of inflation, the central bank feels, that’s most conducive to long-term financial stability.

Recently, however, Bank of America CEO Brian Moynihan said the Fed most likely won’t reach its 2% inflation target until 2025. And Federal Reserve Chair Jerome Powell said in late June that he, too, does not expect inflation to return to 2% until 2025 either.

Given that inflation levels have been dropping steadily since last June, that’s somewhat surprising — but not totally so. It’s sort of like trying to lose 30 pounds. The first 20 to 25 pounds might come off quickly and steadily because they represent excess weight. It’s the last five to 10 pounds that might take a long time to shed.

Similarly, inflation isn’t as rampant as it was last year. But it may take a while to finish the descent back to 2%.

That’s not necessarily the greatest news for consumers. But it could end up being great news for your savings account.

Why inflation is good for savers

The Federal Reserve has raised its benchmark interest rate 10 times since March 2022 in an effort to cool inflation. At its most recent June meeting, it hit pause on interest rate hikes. But more hikes may be in the future to cool inflation all the way down.

That could drive the cost of consumer borrowing up, making it more expensive to do everything from signing an auto loan to carrying a credit card balance. But it could also mean that people with money in savings accounts will get to enjoy a higher interest rate on their money.

The Fed does not dictate what interest rates banks offer consumers. Rather, it oversees the federal funds rate, which is what banks charge each other for short-term borrowing.

But when the Fed’s benchmark interest rate rises, it tends to lead to higher consumer interest rates on products like savings accounts and CDs. So while persistent inflation may not be a wonderful thing, the silver lining is that people with money in the bank might earn more interest until things cool off.

Keep tabs on your savings

It’s a good time to have money in the bank given the interest rates savings accounts and CDs are offering. But you may want to pay attention to signs of cooling inflation in the coming year in case things happen sooner than the Fed and other financial experts expect them to.

Once that happens, the Fed might lower its benchmark interest rate, and that could lead to lower interest rates for individual savers. So if you start to see signs of that happening, you may want to lock in a CD at a higher rate while it’s still available.

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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.Bank of America is an advertising partner of The Ascent, a Motley Fool company. Maurie Backman has positions in Bank of America and Target. The Motley Fool has positions in and recommends Bank of America and Target. The Motley Fool has a disclosure policy.

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