Money Management

You may be surprised to learn what it costs to own a dog. Read on to see how much you can expect to shell out annually on canine care. 

There’s a reason it’s so important to have a nice amount of cash in your savings account before adopting a dog. Not only will you have to pay for upfront costs like adoption fees and supplies, but you’ll also need to shell out money on a regular basis to feed and care for your dog.

Recent data from Rover reveals that the average dog owner spends about $1,188 a year to care for their pet. Meanwhile, the cost of dog ownership tends to range from $610 to $3,555 a year.

Now clearly, the amount of money it costs you to have a dog will depend on different factors. One is the size of your dog, since smaller pups tend to eat less than larger ones. Whether you need to pay for a dog walker will also determine your annual costs. Someone who works from home, for example, might be able to walk their dog as much as needed. But someone who’s at the office five days a week might need to hire a dog walker on a daily basis to exercise their pup.

Your dog’s medical needs will also play a big role in how much you spend annually. But if you want to keep your healthcare-related costs to a minimum, then it pays to buy pet insurance for your pup.

A potentially worthwhile investment

Pet insurance differs from human health insurance in that it generally won’t pay for preventive services unless you pay up for that extra coverage. Rather, the main purpose of having pet insurance is to protect yourself from what could be astronomical costs due to an illness or injury.

Let’s say you spend $50 a month on pet insurance. It’s possible that your dog might fall ill and need a $5,000 treatment that your insurance covers at 90%. In that case, you’re paying $600 in premium costs that year for a $4,500 benefit, and covering just $500 of the total bill.

Similarly, you never know when your dog might get hurt or need surgery. A pet insurance policy might cover all or most of the cost of a multi-thousand-dollar procedure.

It pays to shop around

It’s a good idea to get a pet insurance policy as soon as you adopt a dog. That’s because unlike human health insurance, pet insurers are allowed to refuse to cover pre-existing conditions. So the sooner you put a policy in place, the less likely it’ll be for a health issue to arise with your dog before you have your coverage.

That said, you don’t want to totally rush into buying pet insurance, either. Different plans have different costs, rules, and levels of coverage, so it’s best to take a little time to compare your choices.

Some things to pay attention to are coverage limits for different conditions. If your dog’s breed renders them more susceptible to a given health issue, you’ll want to specifically check to see what coverage you might get for that problem.

All told, owning a dog is hardly an inexpensive prospect. You can do your part to keep your veterinary bills down by buying the right pet insurance, and doing so early on.

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Mortgage closing costs can be expensive, but my brokerage firm is actually helping me reduce my costs. Read on to find out how I’m getting a $600 discount. 

Soon, I will be getting a new mortgage to purchase a new house. As anyone who has ever gotten a home loan knows, it’s very expensive to pay the closing costs associated with the purchase. In fact, closing costs averaged $6,905 in the U.S. in 2022, including taxes.

The good news is, my closing costs are going to be a little cheaper than they otherwise would be. That’s because my brokerage firm is helping me get a break on my mortgage origination fee. Here’s why.

Loyalty has paid off with my brokerage firm

When I get the mortgage on my new home, I am going to save $600 thanks to my brokerage firm.

My broker is linked with a bank that offers a rewards program. Due to my loyalty to this financial institution and because I’ll be getting my mortgage from the same place that I keep my retirement accounts and my taxable brokerage accounts, I’m able to qualify for this rewards program and all the special perks that go along with it. This includes $600 off of the mortgage origination fee, which will directly reduce my closing costs.

Of course, I still shopped around to compare different rates and mortgage offers from different lenders before I decided to go with the bank that is part of this loyalty program. After all, saving $600 is a great deal, but it wouldn’t be worth it if I had to pay a much higher interest rate for my home loan.

Fortunately, the lender with this discount just happened to also offer me the most competitive rate and quickly pre-approved me for the amount I wanted to borrow — perhaps because of my strong existing relationship with it. Plus, the lender can easily see how much money I have invested so it may have more confidence I won’t default on my mortgage loan.

Consider all the benefits and perks your broker offers

Loyalty to one financial institution isn’t necessarily the best decision in every situation. There are many factors to look at when selecting a brokerage firm, including what kinds of accounts the broker offers, what assets you can invest in, and what fees it charges.

But, it’s worth looking at all the perks that different brokers offer when deciding where to keep your money — especially if you will be borrowing for a home soon and could potentially qualify for discounts through participation in loyalty programs.

My brokerage firm and chosen mortgage lender are not the only financial institutions that offer special bonuses and perks for loyal customers, and it can be well worth looking into whether any of these options could save you money on big-ticket purchases. This could help make the difference in deciding which broker to use if you don’t have a strong preference based on other features on offer.

For me, I’m very glad to save this $600 and I’m happy I’ll be doing business with a company I already know and trust when I get my new mortgage loan.

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Making biweekly mortgage payments can help you reduce the cost of borrowing and become debt-free faster. But should you do it? Read on to find out. 

Mortgage loans are designed to be paid off over decades, with borrowers making monthly payments typically for either 15 years or 30 years (depending on the term length you choose when you get your loan).

In some cases, however, you may be interested in paying off your mortgage loan ahead of schedule. Biweekly mortgage payments could potentially help you do that — but should you try out this technique?

Why make biweekly mortgage payments?

Making biweekly mortgage payments would mean you pay your loan every two weeks, instead of making one monthly payment. Essentially, you’d take the amount you owe each month and divide it in half. So if your monthly payment was $2,000, you would make a $1,000 payment every two weeks instead of a single $2,000 payment.

Making biweekly payments can make sense if you are paid every two weeks. Essentially, you would just pay half of your mortgage each time your paycheck is deposited. But you may be wondering why this would actually benefit you. And the reason is simple.

If you make payments every two weeks and there are 52 weeks in a year, you end up making a total of 26 half-payments or 13 full payments. If you pay monthly, then you obviously make only 12 payments. So, by using the biweekly approach, you would make one extra mortgage payment each year.

Making an extra payment allows you to save money on your mortgage over time and pay off your loan faster since your extra payment would go toward reducing your principal balance. This could save you quite a lot of money in the end.

Say, for example, you had a $300,000 principal loan balance, your mortgage interest rate was 4.5%, and you had 18 years left to pay your mortgage loan. If you kept making your monthly mortgage payment of around $2,028.97, you’d pay $138,258.35 in total interest. But if you switched to biweekly payments, you’d end up paying only $120,003.77 in total interest. You’d also pay off your loan several years sooner.

RELATED: Mortgage Calculator

Why you may not want to make biweekly mortgage payments

Although becoming debt-free sooner and spending less over time on your home loan sounds good, you may not necessarily want to take this approach. There are a few reasons for that.

Many mortgage lenders don’t accept biweekly payments — you have to just make one monthly payment. You could still implement this technique by making your payments every two weeks into a savings account, making your normal monthly payment, and then making your 13th extra payment when you have the money. But this is still a bit of a hassle.

The inconvenience of figuring out how to make biweekly payments isn’t enough of a reason not to do it — but there is another reason you may want to pass on this plan. The fact is, the money you use to make the extra monthly mortgage payment during the year could potentially be better used elsewhere.

When you pay your mortgage early, your return on investment (ROI) is simply the saved interest. In our above example, this would mean your return on the saved interest was about 4.5% per year for each year you paid off your loan early. But you could have taken that extra $2,028 and invested in the stock market, potentially earning a better return. An S&P 500 index fund is a relatively safe investment that can produce 10% average annual returns over the long run.

In the above example, paying off your loan using biweekly payments would save you $18,254.58. But if you instead invested $2,028 over the year in the market for 18 years and earned 10% average annual returns, you’d end up with $92,480.68. That’s quite a bit more money.

While the math points to investing as the better return, the fact is, you need to consider whether you really will invest that extra money. If you’re likely to just spend it on things instead, then you’d be better off with the biweekly mortgage payments to become debt-free sooner — especially if you’re passionate about making those extra payments because owning your home outright ASAP is a major priority.

Only you can decide how to prioritize your financial goals, but be sure to make your choice with both eyes open.

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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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No one can live without groceries, but they add up pretty quickly. Read on to learn how to get the food you need at a price you can afford. 

We might differ in the kinds of foods we like to eat or which grocery store we prefer to shop at, but there’s no getting around the fact that everyone needs to eat. And it’s not unusual to spend hundreds of dollars per month on groceries, even if you live alone. Add in a spouse and children and some people may see their monthly grocery bills climb close to $1,000.

That eats up a sizable amount of most people’s paychecks. Unfortunately, there’s no way to eliminate food costs from your budget entirely. But these seven tips can help you save a little on your weekly trips to the grocery store.

1. Double check what you have

Before you head to the store, it doesn’t hurt to double check your pantry and fridge to verify what you already have at home. This can help you avoid forgetting things you need, and it can prevent you from buying duplicates of items you already have.

2. Have a plan

Going into the grocery store with a plan can further reduce the likelihood of buying things you don’t need. Make a list ahead of time and stick to it. You could also check if your grocery store offers a grocery pickup service so you don’t actually have to go through the store at all.

If that’s not an option, you could hire a grocery delivery service to get what you need. This could also save you time in the store. However, you will have to pay a service fee and tip the delivery driver, adding to your costs.

3. Use coupons

Coupons can help you save on all types of grocery purchases, from produce to dairy products. You can probably find some in your hometown newspaper, but there could be many more available online.

If you like to stick to a particular brand, check to see whether it’s currently offering any savings on its products. You may be able to subscribe to an email list to get alerts about new products and discounts.

4. Go generic

Buying generic as opposed to name-brand items can save you quite a bit, and often there’s not a significant difference in quality. If you’re unhappy with the generic item for some reason, you can always switch back.

5. Shop around

Some grocery stores in your area might have better deals on certain items than others. Or one might be running a sale this week, making it cheaper than the store you shop at most often.

Scoping out all your options can help you figure out where you can get the best offers. It might take some time to familiarize yourself with what each store has, but eventually, you’ll know exactly where to go to get the best deals on everything.

6. Consider a wholesale club membership

Wholesale clubs, like Costco or Sam’s Club, often have great deals on groceries, especially bulk items. But you have to pay for a membership in order to shop there. This could be worth it if there’s one near you and you plan to shop there regularly. But if you think you’ll only make it there a few times a year, it might not be the best way to save on groceries.

7. Use a credit card that offers cash back on groceries

Cash back credit cards can help you earn some money back on your grocery purchases over time. Pretty much any card like this should pay you at least 1% back on every purchase, but some offer bonus cash back for grocery purchases, either all year round or during certain quarters. Using one of these cards strategically could help you earn rewards even faster.

You can redeem these rewards for gift cards to your favorite grocery stores. This could be enough to earn you one or two free trips to the grocery store, depending on how much you typically spend.

These tips may not all appeal to you and that’s OK. Pick and choose the ones you think you could easily fit into your lifestyle and see what kind of a difference in your grocery bill they can make for you.

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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.Kailey Hagen 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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Buying life insurance is cheaper at a younger age, but does there come a point when people age out of being eligible? Read on to find out. 

Buying life insurance is an important financial move for many people. A life insurance policy pays out a death benefit when the covered person passes, so surviving beneficiaries aren’t left without funds in their bank accounts that they need to maintain their lifestyle.

Purchasing life insurance should ideally be done at a young age, as insurers price policies based on risk of death during the term of coverage. Obviously, the older someone is when they buy a life insurance policy, the greater the risk they’ll die soon, so the higher premiums will be.

The big question, then, is whether someone can ever become too old to buy life insurance.

When do insurance companies cut off older people from buying coverage?

The first big thing consumers need to think about when deciding if they are too old to buy life insurance is whether they will be able to qualify to buy a policy. And when it comes to answering this question, a consumer should consider the difference between term and whole life insurance.

Term life insurance policies are usually the better option for most people. They remain in effect for a set period of time, such as 10, 20, or 30 years. If the policyholder doesn’t die during the coverage term, the death benefit does not pay out. Whole life policies, on the other hand, provide coverage indefinitely as long as policyholders pay premiums, so the death benefit will always be paid out.

Term and whole life insurers usually have differing rules for when someone becomes too old to buy life insurance. Many companies do not allow the purchase of term life insurance after around age 65 or 70. Whole life insurers usually allow for coverage to be bought for longer — often up to age 85 or even age 90.

Guaranteed issue life insurance

Since there usually is an upper age limit, it is possible to become too old to buy certain kinds of coverage. However, there is almost always some kind of life insurance available to buy. For example, guaranteed issue plans are typically targeted toward older people. These policies are available regardless of health status, but usually have low coverage limits, and there may be a waiting period before full coverage goes into effect.

For example, if a policyholder with a guaranteed issue policy dies during the first year of coverage, the insurer may pay out nothing or only a small percentage of the death benefit. The full death benefit may not be available for two years or so after the insurance is purchased. So, someone who is very old when they buy a policy takes a chance of not living long enough for the full death benefit to come to loved ones.

Before buying guaranteed issue life insurance, older Americans need to read the fine print carefully, make sure they know when the policy will pay out, and think seriously about whether premiums are worth the payout or whether they’d be better off saving the money they’d have spent on those premiums and leaving that cash to their families.

When do older people stop needing coverage?

Aside from whether seniors can buy coverage, it’s also worth thinking about when they should. For many people, there comes a point when they are “self-insured.” This can happen if there are no dependents relying on them for income or services and if they have plenty of money to pay for their funeral costs. If surviving loved ones wouldn’t need a death benefit to cover burial expenses or maintain their standard of living, there’s generally no reason to buy life insurance.

Ultimately, it’s always best to buy a policy at a young age, but those who are older should consider these issues to make an informed choice about when or if they should buy coverage as seniors.

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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.Christy Bieber has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Target. The Motley Fool has a disclosure policy.

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David Rosenberg says the S&P 500 is already signaling a recession. Find out what that means for your investments and what steps you might want to take. 

What happened

Well-known economist David Rosenberg says there are already signs we’re entering a recession. A recession is a prolonged period of economic downturn, often indicated by two consecutive quarters of negative growth. It often involves increased unemployment, a contraction in manufacturing and other industrial production.

Rosenberg tweeted on Thursday, “The question always comes — why isn’t the S&P 500 signaling a recession? Answer: it is.” According to Rosenberg, the most economically sensitive areas, such as transport, discretionary spending, and banks, are already down. This, he argues, reflects patterns from previous economic downturns.

So what

Financial experts have been warning about an impending recession for some time. So much so that many individuals and businesses have already done a lot to ensure they’re prepared. Geopolitical uncertainty, the recent banking crisis, inflation, and high interest rates all play a role. Nonetheless, if you’re an investor, Rosenberg, along with other economists, warn that the value of your portfolios may fall even further.

Now what

One of the challenging things about this much-anticipated recession is that some economists argue it won’t even happen. They point to the strong labor market and relatively low levels of consumer debt, and say the economy is more resilient than we may think.

That said, many of the steps you might take to prepare for a recession will stand you in good stead whatever happens to the economy. For example, an emergency fund with enough cash to cover three to six months’ worth of living expenses can guard against a host of unexpected events. Even if you put a small amount each week into a savings account, it will give you a cushion against life’s curveballs.

In terms of your investments, it can be tempting to sell your stocks on the back of warnings from experts like Rosenberg. The trouble is that panic investment decisions rarely work out well. We don’t know for sure whether the market will drop, nor when it will happen. If you sell now and prices go up, you won’t benefit from the recovery.

Here are three useful pieces of advice for investors in a recession:

Focus on the long term: Historically, the stock market has always recovered and gone on to reach new highs. Research assets with strong fundamentals that you believe will perform well over time, and aim to hold them for five to 10 years or more.Consider dollar-cost averaging: Dollar-cost averaging involves investing a set amount of money at regular intervals. For example, you might invest $200 on a set date each month. It takes away some of the hesitation to buy stocks when economists are warning of impending doom, and can also mitigate some of the risk.Diversify your portfolio: Diversification means buying a mix of assets in a mix of sectors, so you’re not overly reliant on any one thing. That might mean buying index funds or ETFs rather than individual stocks. It can also involve including real estate, commodities, and alternative asset classes in your portfolio.

Our best stock brokers

We pored over the data and user reviews to find the select rare picks that landed a spot on our list of the best stock brokers. Some of these best-in-class picks pack in valuable perks, including $0 stock and ETF commissions. Get started and review our best stock brokers.

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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