Money Management

It only takes a few minutes, and you’ll be glad you did it. Here’s why. 

Spring brings nicer weather and, for many, an opportunity to get a little more organized and tackle projects they’ve been putting off. You’ve probably heard of spring cleaning your home, but there’s no reason you can’t do the same for your finances as well.

If you’re looking to improve your financial situation or just get a better idea of where you stand right now, here’s one thing you should definitely add to your to-do list.

How’s your credit?

Your credit affects your finances in a lot of ways. It determines which credit cards you qualify for, what kind of interest rate you get on a loan, and even whether you’re able to get certain jobs or apartments. But a lot of people still don’t understand how their credit reports work or where they can access them.

The good news is, it’s not difficult to do and it shouldn’t cost you anything. The government requires that all three credit bureaus provide you with one free report per year through AnnualCreditReport.com. The credit bureaus have also been offering free weekly reports since the start of the pandemic. You can use these to see how your actions affect your credit over time.

In order to access your credit reports, you must answer some multiple-choice identity verification questions. These could include the name of the bank you have your mortgage through or the name of the street you lived on a decade ago. Once you’ve done this, you’ll have the opportunity to view and save your credit reports.

These reports can be a little confusing if you’ve never looked at them before. They contain some basic personal information about you as well as the details of every credit account currently in your name. This includes credit cards and loans. It’ll list details like your outstanding balance and your payment history.

Credit scoring models take this into account when determining your credit score. You won’t receive this with your free credit report, but you can find many companies willing to provide this. FICO, the creator of the most popular credit scoring model (FICO® Score), enables you to purchase credit scores, but some credit card companies may give you access to this information for free. If so, this might be worth checking out as it gives you additional guidance on where you stand.

What should you look for when checking your credit reports?

The most important thing to do when checking your credit reports is to look for anything that’s inaccurate. This could include credit accounts you know were closed that are still showing up as open or accounts you don’t recognize at all. The latter could be a sign of identity theft.

If you notice any mistakes, it’s important to correct them as soon as possible. Notify the credit bureau and the financial institution associated with the account of the situation. If you have documentation supporting your claim — for example, anything that proves you paid off a loan that’s still showing as active — submit a copy of this as well. The credit bureau will investigate and update your report if it deems this is necessary. It will then send you a new, updated credit report free of charge.

You can also use the information in your credit report to identify areas you could work on to improve your credit score. For example, if you see late payments on your report, that could be a sign you need to come up with a strategy to help avoid this in the future. That could be as simple as setting up automatic payments or it could be more involved and require cutting back spending to reduce your monthly bills.

Other things to watch for include:

Credit utilization ratio: This is the ratio between your available credit and how much you use. For example, if you have a card with a $10,000 balance and a $2,000 limit, your credit utilization ratio is 20%. Ideally, you want to keep this under 30% to keep your credit score high.Number of credit inquiries: Every time you apply for new credit, it adds a credit inquiry to your report. These can lower your score by a few points. It’s generally best to avoid applying for new credit too often to reduce the impact this has on your credit score.

Use the information you find in your reports to guide you on how to improve your credit score. If you don’t see any obvious red flags, there might be nothing for you to do except continue as you have been. But it’s still a good idea to check your credit report annually. Identity theft can happen to anyone, and it’s better to find out about it by checking your credit routinely rather than by getting denied for a loan or credit card when you really need it.

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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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I love Costco, but I prefer to go without my kids. Read on to see why. 

The $120 a year I spend on my Costco executive membership is more than worth the cost. That membership gives me 2% back on all Costco purchases. And given the amount of shopping I do, I end up with a lot of cash back in my pocket.

But while Costco is a store I tend to visit on a weekly basis, most of the time, I make a point to go there without my kids. Here’s why.

1. They tend to want to try everything

A big perk of shopping at Costco is getting to sample different foods as you roam the aisles. My kids happen to love Costco samples. But often, when I’m doing my Costco shopping, I’m in a bit of a hurry. And I don’t always have time to stop at every station for my kids to stuff their faces.

Plus, sometimes, the kind Costco employees who work these stations will generously give my kids extra servings of the snacks they’re sampling. That can sometimes be problematic if we’re picking up dinner at Costco — namely because then my kids will fill up on junk and won’t actually eat dinner.

2. They tend to beg for toys

Costco’s toy aisle is loaded with fun items that appeal to my kids. And on occasion, I’ll let them pick one board game or sports item (like a soccer ball) that they can share.

But here’s a secret — I have a hard time saying no to my kids. And often, when they ask for toys at Costco, I do say no.

I don’t like being in that position, but I also don’t enjoy having extra charges on my credit card for arts and craft kits and puzzles when it’s not a birthday or holiday. And so it’s sometimes easier for me to just leave my kids at home.

3. They insist on eating at the food court when they’re hungry

You’ll commonly hear that it’s not a good idea to go grocery shopping when you’re hungry. Well, here’s an even worse idea — going grocery shopping with your kids when they’re hungry.

Every time we go to Costco at an hour that could, conceivably, overlap with lunch or dinner, my kids insist on getting something from the food court. And while I could always exercise my parental right to say no, it’s not easy.

Costco’s food court definitely makes for a nice, cheap meal, so there’s that perk. But do I love the idea of feeding my kids hot dogs for lunch? Not exactly.

In fact, now that my kids are older and have discovered soda, I especially feel that I have to keep them away from the Costco food court at all costs. Their math knowledge is robust enough to know that $1.50 for a hot dog and soda is a deal that’s too good to pass up.

I love my kids with all of my heart. But that doesn’t mean that bringing them with me to Costco is always the best idea. And so I make a point to try to do most of my Costco runs while they’re in school or otherwise occupied. It’s just easiest all 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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Resort fees tacked on at checkout can make your trip more expensive. Find out why Marriott will soon include resort fees in the total listed price. 

What happened

In 2021, the office of former Pennsylvania Attorney General Josh Shapiro reached an agreement with Marriott after investigating how the hotel chain disclosed resort fees. The investigation found Marriott’s non-transparent pricing strategy to be deceptive and confusing to consumers.

In a settlement, Marriott agreed to disclose the total price of a hotel stay, including all fees, on the first page of its booking website instead of listing resort fees later in the checkout process.

In April 2023, recently appointed Attorney General Michelle Henry reached a new agreement when Marriott failed to comply after being given multiple extensions. The new agreement requires the hotel chain to disclose all fees upfront in its listed prices by May 15, 2023.

So what

In a 2021 press release, former Attorney General Josh Shapiro had the following to say, “Hotels shouldn’t be able to slap hidden fees on top of your bill at the last minute, and thanks to this settlement, we’re putting the hotel industry on notice to put an end to this deceptive practice.”

In a recent Skift article, a Marriott spokesperson discussed what the brand was doing behind the scenes to implement the required changes. The representative noted, “We have been working diligently over the last several months on the technology required to update our room rate display and further enhance the way these fees are disclosed, in accordance with our agreement with the State of Pennsylvania.”

Now what

This pricing update is welcome news that could help travelers better honor their vacation budgets when making travel arrangements. Unexpected extra fees add up and impact your personal finances. Many travelers feel nickeled and dimed when they find a hotel rate they can afford but later spot additional fees added during checkout.

It’ll be interesting to see if other hotel chains follow suit. Consumers have become increasingly frustrated by extra fees. One of the current initiatives for the Biden administration is to crack down on excessive junk fees, including banning unnecessary resort and destination fees. Hopefully, legislation will pass in the future to better protect consumers.

For now, here’s the good news: Beginning on May 15, you can feel more confident about the price you’ll pay when booking a Marriott property. No matter what hotel chain you book with, you may want to consider paying with a hotel credit card to earn rewards. Many of the best hotel credit cards also include valuable perks to improve your travel experience.

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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.Natasha Gabrielle has no position in any of the stocks mentioned. The Motley Fool recommends Marriott International. The Motley Fool has a disclosure policy.

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If you want to buy a home more quickly, Dave Ramsey recommends taking four steps, including getting pre-approved for a loan. Find out more. 

If you’re thinking about buying a house, you should be aware that it could take you quite a bit of time to do it. Not only do you need to find the perfect property, but you also need to get an accepted offer and make sure you get the right mortgage loan.

If you’re eager to be in your new home yesterday and you don’t want to wait weeks or even months for these steps to unfold, you may want to consider Dave Ramsey’s advice for speeding up the purchasing process. Here are four suggestions the finance guru made, along with some thougths on whether or not following this advice makes sense.

1. Pay cash for your house

Ramsey’s first proposed plan for buying a home more quickly is to avoid a mortgage loan altogether.

“Want to put the home-buying process into overdrive? Pay for it with 100% cash. That’s right — no mortgage. Think about it: If you don’t need a mortgage, you won’t have to deal with all the time-sucking aspects of nailing one down. No need for an approval process, loan paperwork or anything else like that,” Ramsey said.

This indeed would make things a whole lot faster since mortgage lenders can take weeks or even months to review all the details and get to closing. If you don’t have a lender, you can also choose to skip time-consuming steps like a home appraisal (which lenders usually require).

However, there are huge downsides to paying cash for a home. You’ll be tying up a ton of money in an illiquid asset, for example. You’re usually better off getting a mortgage and keeping more money invested, where it can earn higher returns.

Of course, you could pay cash and then do a cash-out refinance later once you’re in the house. This would mean getting a mortgage loan later on. However, refinance loans usually have higher rates than loans to buy a home, so this isn’t a perfect solution.

2. Get mortgage pre-approval

Ramsey’s next suggestion is more practical. He advises getting pre-approved for a home loan if you are going to get a mortgage.

“From contacting a mortgage company to getting the letter, pre-approval takes a few days. But the extra time usually pays off later by helping make contract to closing go a lot faster,” Ramsey said.

He’s right about this. Getting pre-approved is also often a requirement before sellers will allow you to look at their homes. And you won’t be able to get an offer accepted on a home in most cases without showing you’ve been pre-approved.

3. Gather your paperwork

When applying for a mortgage, you must provide a lot of financial documentation. That’s why Ramsey rightfully suggests gathering all of these details if you want to make the buying process faster.

“If you’ve been pre-approved by a mortgage company, you’ll already have all your pay stubs, bank statements and tax returns at hand. But keep them close and make sure they’re as recent as you can get. You’ll need them again during the mortgage application process,” he suggested.

It can be helpful to keep digital copies of all of these documents in a folder on your computer so you can send them to mortgage lenders easily.

4. Get your closing costs ready

Finally, Ramsey’s last tip is to be prepared for closing costs. These can be very expensive, adding up to around 2% to 5% of your loan amount. You’ll want to make sure you have this money ready so you can bring it to closing without delay.

By following these tips, you can streamline the mortgage application process and make sure you’re able to get the keys to your new place as quickly as possible.

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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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If you’re an American Airlines AAdvantage member, make sure you don’t let your miles expire. Read on to learn what you can do. 

Airline loyalty programs can make flying cheaper and more enjoyable for frequent travelers. By joining your favorite airline’s loyalty program, you can take advantage of valuable benefits and earn miles that you can later redeem for free flights. The American Airlines AAdvantage program is one popular program for frequent fliers. If you’re a member of this program and haven’t flown in a while, don’t let your miles go to waste.

Beware of loyalty program rules

No matter which frequent flier program you join, you should understand how the program works. As an AAdvantage member, you must have some mileage earning or redeeming activity once every 24 months or have an open AAdvantage credit card account to retain your miles. If not, your AAdvantage miles will expire unless you pay a fee to reactivate them. Luckily, there are many ways to keep your American Airlines miles from expiring.

1. Open an American Airlines credit card

The easiest way to keep your American Airlines miles from expiring is to open an American Airlines credit card. By maintaining a credit card account, your miles won’t be at risk of expiring. If you’re looking for a new credit card and are an American Airlines loyalist, check out our list of the best American Airlines credit cards.

If you close your American Airlines credit card account, your miles will be at risk of expiring. If you don’t have mileage earning or redeeming within four months of closure or 24 months of the last qualifying activity date, whichever is later, you’ll lose your miles.

2. Buy a cheap flight

You can keep your miles from expiring by purchasing an American Airlines flight. If you’re at risk of losing your miles, searching for a cheap flight for a quick weekend getaway may be worthwhile. Before booking, check out the current travel deals and offers on the American Airlines website to see if you can find an affordable flight that works for your personal finances.

3. Redeem earned miles

Another way you can keep your miles active is by redeeming American Airlines miles for an award flight. If you have enough miles to book an award flight and have some remaining miles left in your account, you can feel confident knowing that they won’t be at risk of expiring.

4. Shop through the AAdvantage eShopping portal

Many American Airlines loyalists use the airline’s shopping portal to maximize the miles they earn and keep their miles from expiring when they haven’t flown in a while. The American Airlines AAdvantage eShopping portal features more than 1,200 retailers. You can earn rewards and keep your account active by activating offers and shopping through the portal. Only buy what you can afford, as it’s never a good idea to go into credit card debt to keep your miles active.

5. Use the American Airlines dining program

American Airlines has a dining program called AAdvantage Dining. You’ll earn miles when you link a credit card to your account and spend money at participating restaurants. This account activity will also allow you to extend the expiration date for your miles. This is a win-win strategy, because you can keep your miles active and boost your mileage balance.

Don’t ignore airline loyalty programs

If you like to travel, don’t forget about airline loyalty programs. You can get rewarded for your spending and take advantage of benefits that improve your flying experience. Having enough miles to redeem for a free flight can be a significant win for your wallet. If you fly often, check out our list of the best airline credit cards so you don’t miss out on the chance to earn rewards.

Alert: highest cash back card we’ve seen now has 0% intro APR until 2024

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 until 2024, 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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