Money Management

Amazon pallets are filled with boxes of returned goods. Read on to discover how you can flip these pallets into a profitable side hustle. 

Ever wondered what happens when you return items to Amazon? You get refunded, of course, but what does Amazon do with the items?

In some cases, Amazon will return the item to the seller, who tries to resell it at market value. But when the seller doesn’t want the item returned, Amazon will typically box it with hundreds of other unwanted returns, shrink-wrap it with other boxes, and sell the bulk as a liquidation pallet to entrepreneuring buyers.

That’s right, anyone can buy these pallets from Amazon. They can be dirt cheap — sometimes as low as $200 — but you don’t know what’s inside. You could get a pallet of resaleable office chairs. Or defective electronics and used clothes.

Some people have been making some serious cash reselling items they find inside liquidation pallets. But can anyone make money and if so — how much?

What are liquidation pallets?

Also called “return pallets,” liquidation pallets are boxes of general merchandise that Amazon wants to liquidate quickly.

The pallets are typically sold at online auctions, though you can also buy them at a flat rate from warehouses. Some start as low as $200 to $800, while others will go for $8,000 to $13,000.

Typically, the higher the price, the more pallets you get. For instance, a truckload of pallets, which consists of 12 to 24 individually shrink-wrapped pallets, can start for a few thousand dollars. A single pallet, on the other hand, may sell for a few hundred dollars.

How can you make money from Amazon pallets?

Like any side gig, you’ll need to hustle if you want to make money on Amazon pallets. In general, here’s what it involves.

1. Buy your pallets

The cheapest way to buy pallets is to find a liquidation warehouse. These warehouses store pallets and sell them directly for pickup.

A liquidation warehouse helps you save on shipping costs, which can be almost as much as the pallet itself. It also allows you to look at the boxes that comprise the pallets. Sometimes, you can see what items are inside simply by looking at the brands and descriptions on the boxes.

If you don’t have a warehouse near you, you can bid on Amazon pallets through the website, B-stock. Although Amazon only auctions its pallets through B-stock, you might be able to find similar pallets on other liquidation websites, such as BULQ and Liquidation.com.

2. Appraise your items

Most boxes will have hundreds of items, but they won’t all be in the same condition. You might get brand new and gently used items. Or you could get items that are defective, broken, or missing parts and accessories.

For lightly used items, you can typically recoup about 50% to 60% of their market value. For items that are defective, you could fix them yourself or break them down into parts and sell those individually.

As far as figuring out the market value of an item, just use Amazon. Discount the item at 50% to 60% of whatever Amazon is selling it for. That should be enough to help you recoup the cost of the pallet, plus a little extra for profit.

3. Resell

Once you’ve sorted your goods, you’ll have to pick a place to sell them.

For big items in high demand, Facebook Marketplace and Craigslist will likely be your best options. Both of these platforms have low fees and can help you save on shipping costs by marketing to buyers within your area.

If you can’t sell goods for a decent price on these sites, you’ll have to use a fee-based service like eBay to liquidate your stuff quickly. You could also resell products on Amazon — the irony, right? — though you’ll have to pay an 8% to 15% referral fee.

Keep in mind: If you earn more than $400 in pallet flipping, you’ll need to pay taxes. You can set this money aside in a high-yield savings account until it’s time to pay.

This seems like a lot of work. How much can you really make reselling pallets?

At the very least, you can recoup the cost of the pallet itself. But if your pallet has good items, you might be able to flip them for 100% to 200% more than what you paid for.

Even so, don’t expect to get rich from pallet flipping. This is side hustle-worthy, but it likely won’t generate enough profit for you to quit your day job.

Should you start flipping Amazon pallets?

Buying and reselling pallets is ideal for people who own a truck and can pick up pallets directly from warehouses. You should also be okay spending 10 to 15 hours weekly on your feet sorting goods and cataloging them online. But if that sounds like too much work, you might want to pick a side hustle that’s a bit more passive.

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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. The Motley Fool has positions in and recommends Amazon.com. The Motley Fool recommends Discover Financial Services. The Motley Fool has a disclosure policy.

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Today’s mortgage rates aren’t so bad. Read on to see why. 

There’s a reason so many people are continuing to wait to buy a home. Not only are property values still elevated on a national scale, but mortgage rates are still pretty high.

Or are they? It’s true that if you sign a mortgage today, you’ll generally be looking at an interest rate that’s higher than what you would’ve paid in 2021 or early 2022. But today’s mortgage rates aren’t as high as they were back in late 2022. And that’s something worth considering.

You might enjoy some savings by signing a mortgage today

In late 2022, there was a point when mortgage rates reached and even surpassed the 7% mark. These days, however, rates are hovering in the low- to mid-6% range. (And to be clear, when we talk about mortgage rates in this context, we’re referring to the 30-year mortgage. You might snag a lower rate on a 15-year loan because you’re borrowing for a shorter period of time.)

A recent analysis from Lawrence Yun, chief economist for the National Association of Realtors, found that signing a mortgage today compared to last year’s 7% peak could save the typical borrower $140 a month on a $300,000 mortgage. That’s a big difference — one that might help you feel better about signing a mortgage now.

Should you put off homeownership until mortgage rates come down?

Many buyers have paused their home searches and are hoping to hold off on making a purchase until mortgage rates come down. But it may be time to accept the reality that rates aren’t going to plunge anytime soon.

Is it possible that we’ll see mortgage rates in the upper 5% range this year? Yes. But we’re most probably not going to see mortgage rates dip back down into the 3% or 4% range anytime soon. And that’s something buyers need to accept and come to terms with.

If you’re delaying a home purchase until mortgage rates get back down to 3% or 4%, you might end up waiting a really long time. So rather than do that, crunch the numbers. If you can afford to purchase a home today with a mortgage in the 6% range, and you’re eager to start reaping the benefits of homeownership, go for it.

In time, mortgage rates have the potential to drop. We may not see a notable dip for a good number of years, but if you can afford a home based on today’s rates, you can always sign a more expensive mortgage and then look to refinance your loan to a lower interest rate once the opportunity presents itself.

Of course, that makes a few assumptions — that your home’s value doesn’t decline substantially and that your credit score remains in good shape. Refinancing could become difficult if the value of your home plunges and your credit score takes a dive. But otherwise, it’s something to keep at the back of your mind if you’re not so happy with today’s mortgage rates but wish to become a homeowner sooner rather than later.

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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.
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Disney Genie+ and Lightning Lanes are both ways to save time waiting in lines, but they come at a cost. Read on to learn why only one is worth it for my family. 

As Florida residents, my family and I have season passes to Disney and we visit the parks often. When we go, there are times when I will be willing to pay for Disney’s Genie+ service. What I will not do, however, is pay for individual Lightning Lanes.

If you’re trying to figure out whether you should tap into your bank account to buy these different services, it may be helpful to understand what each of them do and why one may be more worth it than another. Here’s why I’m willing to put Genie+ on my credit card but Lightning Lanes aren’t an option in our household.

Here’s why I’ll pay for Genie+

Paying for Genie+ makes sense for my family because it opens up the door to get on the vast majority of rides we want to go on within minutes.

With Genie+, you can make your first reservation to access a Lightning Lane two hours prior to park opening and then every two hours once the park opens. A reservation for a Lightning Lane enables you to get into a special shorter line for rides. As you use each reservation, you get to make another one. So, you can have several reservations at once toward the end of the day and end up not having to wait for the majority of rides.

Disney has been very crowded for months, with even basic rides like the Mad Tea Party (aka the famous spinning teacups) having waits of 20 minutes or more. Standing in line for hours just to go on a few rides makes going to the parks not worthwhile at all, so I’m willing to pay the extra money per person when we visit in order to enjoy the trips we take.

Here’s why I won’t pay for individual Lightning Lanes

Individual Lightning Lanes are very different from Genie+. There are certain rides at each park that you cannot make Lightning Lane reservations for with Genie+. You can only reserve access to the shorter Lightning Lane line if you pay per ride. This pay-per-ride system provides access to attractions like Seven Dwarfs Mine Train and Avatar Flight of Passage.

The prices for these individual Lightning Lanes typically cost between $7 and $25 depending on the ride and how crowded the park is. That means you are paying this just to have fast access to a single ride. And that’s per person, so for a family of four, it could be an extra $100 just to go on a single ride more quickly.

While paying to skip lines all day long makes sense to me since I can get on dozens of rides and be busy all day with my kids, paying what is essentially the cost of an entire day’s ticket to a cheaper theme park just to go on a single ride that’s over in minutes just does not seem to provide enough value.

If you’re headed to Disney, be sure to understand the difference between what Genie+ and individual Lightning Lanes get you so you can make the right choice about which one — if any — to purchase.

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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.
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Taking withdrawals from emergency savings isn’t fun. Read on to see what you can do to avoid having to constantly tap your emergency fund. 

If you’ve managed to sock away some money in your savings account for emergencies, good for you. Having an emergency fund will often spell the difference between racking up costly credit card debt and avoiding it when unplanned bills arise.

In fact, a recent SecureSave survey found that 67% of Americans could not cover a $400 emergency expense with money in savings. So if you’re well beyond that point, you’re in a good place.

But while it’s definitely a great thing to have emergency savings, it’s not a great thing to keep tapping your cash reserves. If that’s been happening a lot lately, you may need to make some adjustments to your budget.

The problem with frequent emergency fund withdrawals

If you have an emergency fund, you should expect to have to use it at some point. But while it’s one thing to tap your emergency fund once a year for something like a home or car repair, it’s another thing to raid your savings more frequently to cover things like home maintenance, medical bills, and higher living costs due to inflation. And so if you’ve been hitting up your emergency fund on a regular basis lately, it’s probably time to rethink your spending and change your budget a bit.

Let’s say that in the past six months, you’ve taken an emergency fund withdrawal on three separate occasions to partially cover your grocery bills, and on three other occasions to cover medical bills you didn’t expect. That should serve as a sign that you need to adjust your budget to allow for more grocery and medical spending.

The problem with tapping your emergency fund too often is multifold. For some people, taking an emergency fund withdrawal is upsetting, so you’re putting yourself through that time and time again. But getting used to raiding your emergency fund and learning to roll with it isn’t so great either, because once you get into that habit, you might come to rely on your emergency fund on a regular basis.

Furthermore, if you keep taking small emergency savings withdrawals to cover expenses like food and healthcare, you might end up with inadequate funds to pay for things like major home repairs or a period of joblessness. So if tapping your emergency fund has become a regular occurrence, you may want to do what you can to break that cycle.

Is your emergency fund still sufficient?

If you’ve been hitting up your emergency fund pretty often lately, you may no longer have the same amount of money you had when you first built up that pile of cash. As a general rule, you should aim for a minimum of three months’ worth of bills in your emergency fund. If you’re no longer there, consider it an immediate wake-up call to rework your budget so you can carve out money to build your emergency savings back up. That way, if you lose your job or get hit with a really large expense, you won’t be left in the lurch.

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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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Three big choices can decide your financial fate. Read on to find out what they are. 

When it comes to your financial life, many people focus on the small stuff like how much they are spending on lattes. In reality, this is not going to make that much of a difference in terms of growing your bank account (unless you have a really bad latte habit).

Instead of looking at these little things, there are three big decisions that will largely determine whether you become rich or end up struggling financially throughout your life. Here’s what they are.

1. How much you invest

One of the biggest factors that determines if you’ll end up wealthy or not is how much you invest in your brokerage account. When you invest money, that money starts to earn additional funds for you. If you get a 10% average annual return on your investment, then all of that money can be reinvested. Next year, you’ll have a bigger pot of money earning returns, and your returns will grow exponentially.

To understand just how big of an impact investing can make, consider what would happen if you invested $100,000, earned 10% average annual returns, and never invested another dime. In 30 years, you would have $1,744,940.23. Your invested funds would have earned that much for you with little effort on your part.

To benefit from the compound growth that comes from investing, start putting money into the stock market as early as you can and invest as much as you can (aiming for around 20% of your income). If you can do that, you increase your chances of ending up rich, as long as you make smart investments and don’t overspend.

2. How much you spend on your housing payment

Your housing payment will also have a huge impact on whether you end up rich or broke. Your housing costs are likely to be the biggest monthly payment you have. If you stretch your budget to buy a home you can’t afford, that monthly payment is going to eat up so much of your money it will be impossible to do other things — like invest so you can grow rich.

3. How big your car payment is

Your car payment is going to make a huge impact on your financial picture as well. That’s because this is also a big monthly payment that can prevent you from having enough left to accomplish other things. If you borrow too much and keep upgrading your cars every few years so you always have a car loan, it’s going to be a lot harder for you to avoid debt and get ahead financially.

If you can keep your housing payment to no more than 25% of monthly take-home pay and your car payment to no more than about 10%, you should be in a good position to have plenty of cash left over to invest. And those investments you’re making should help you build the wealth you deserve.

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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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There’s a big misconception about personal loans. Read on so you don’t get hurt by it. 

As of the end of 2022, personal loan balances across the U.S. totaled $222 billion, according to data from TransUnion. And that’s not all that surprising.

There are different reasons consumers commonly turn to personal loans when a need to borrow money arises. For one thing, personal loans let you borrow money for any purpose. When you take out a mortgage, for example, you can only use your loan proceeds to finance the purchase of a home. With a personal loan, you can use your money to fix up your house, start a business, or take a vacation if that’s a priority for you.

Also, personal loans are known for their relatively competitive interest rates. By contrast, you might spend a lot more money on interest when you borrow by racking up a balance on one of your credit cards.

But while personal loans have their benefits, it’s important to proceed with caution before taking one out. And the one thing you don’t want to do is sign up for a personal loan without running the numbers first.

Don’t fall into a common trap

Because personal loan interest tends to be competitive, many consumers think they can just borrow on a whim and it’ll be affordable. But that’s not a given.

First of all, these days, personal loan interest rates are up because borrowing rates for consumers are up across the board. That’s a side effect of a string of recent interest rate hikes from the Federal Reserve.

Now, it’s true that you might snag a relatively competitive interest rate on a personal loan today. But that doesn’t mean you should rush into borrowing, nor does it mean you’ll automatically be able to manage your ongoing payments under that loan. So before you sign up for a personal loan, take a look at your expenses and figure out what monthly payments you can afford.

Also, think about why you’re considering a personal loan. It’s one thing to borrow money when you have home repairs you’ve been putting off due to a lack of cash, or if you’ve been itching to start a business but need seed money. It’s another thing to take out a personal loan and use the proceeds for things that are fun but not really necessary.

Remember, falling behind on a personal loan could have severe financial consequences, like major damage to your credit score. So you definitely do not want to get in over your head.

Shop around before you sign for a personal loan

Just as it’s important to figure out what sort of personal loan payment you can afford based on your income and bills, so too is it important to shop around for a personal loan rather than go with the first lender who’s willing to loan you money. Ultimately, each personal loan lender sets its own borrowing rate based on factors like your credit score. So if you’re going to borrow, take the time to do your research so you end up walking away with the best interest rate you’re eligible for.

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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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