Money Management

Hiring an accountant saves me time and helps ensure I don’t make a mistake with complicated returns. Here’s why it pays off for me. 

Tax-filing season has just come to a close, which is a big relief. My returns have been submitted, and I’ve fulfilled my major obligations to the IRS for the year. Now all that’s left for me to do is pay my accountant and pick up the returns that she filed for me.

See, while I could theoretically file my taxes on my own, I’m always happy to write a check out of my bank account to my tax professional. There are three big reasons why that’s the case.

1. My taxes are more complicated than most people’s

The biggest reason that I choose to hire a tax professional to file my taxes is because they are pretty complicated. See, my husband and I both own S-corporations and pay ourselves a salary and dividend from them. This means we need to file business returns as well as personal ones. We also have some investment properties and we itemize deductions, so we need to declare specific expenses as tax deductions.

Taking care of all of these issues is not as easy as just using an online tax-filing service. It would take a lot of time and effort to learn how to complete all of our forms correctly and to make sure we’re getting the maximum amount of deductions and credits. My tax professional knows the ins-and-outs of the law and the filing process for our complicated returns so we’d rather just entrust her to take care of it.

2. I’m afraid of getting audited and owing money if I DIY

Since my husband and I are self-employed and his business is one where he collects cash, I fear that we’re at a higher risk of capturing the attention of the IRS and triggering an audit. I don’t want that to happen but, even more, I don’t want the IRS to find we made mistakes and now owe a lot of money.

By working with an accountant, I feel more confident that we are submitting the correct information so if we are audited, we wouldn’t owe a ton of back taxes. Our accountant would also be there to help us through the process.

3. Learning how to file my own taxes would be a waste of my time

Finally, the last big reason why I hire a tax professional to do my taxes is because it would take a lot of time for me to do them myself. And the wasted hours simply are not worth it. It would cost me more in lost working time to do the taxes myself than it costs me to pay my accountant to do them for me.

Ultimately, there are good tax-filing programs out there and many people can take advantage of them rather than paying a tax professional. But for those whose situations are more complex, getting the right help may be the best course of action and may be well worth the fee that an accountant would charge.

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Owe money on a credit card? Read on to see why your interest rate may not spike quite so much in the near term. 

In February, the Consumer Price Index (CPI), which measures changes in the cost of consumer goods and services, rose 6% on an annual basis. That’s a much lower reading than what we saw in mid-2022, when inflation came in at over 9%.

Meanwhile, in March, the CPI dropped even more with regard to annual inflation. On a year-over-year basis, the index was up 5%. That’s a notable drop from February’s reading. And it could spell relief for consumers across the board.

Credit card borrowers, however, might really benefit from the latest CPI reading. Here’s why.

Cooling inflation might calm the Fed down

The Federal Reserve has been on a mission to cool inflation. Bringing annual inflation closer to the 2% mark is thought to lend to a more stable economy — or so says the central bank itself.

To bring inflation down, the Fed has been raising interest rates since early 2022. And it’s already raised interest rates twice this year.

But if the Fed winds up happy with March’s CPI reading, it may decide not to raise interest rates at its next meeting in early May. And if interest rates stay where they are, credit card borrowers with existing balances may not see their costs rise so drastically in the near term.

See, unlike personal loans and home equity loans, which allow you to lock in a fixed interest rate on your debt, credit cards tend to come with variable interest. You could end up on the hook for higher payments — and struggle as a result. Meanwhile, Fed rate hikes have the potential to make credit card debt more expensive. So if the central bank keeps rates where they are, credit card borrowers can benefit.

How to shed your credit card debt

Credit card debt can be extremely costly — not only because the interest rate on your debt can rise, but because credit cards tend to charge a large amount of interest to begin with. Plus, too much credit card debt can actually damage your credit score. This holds true even if you’re able to make your minimum payments every single month. And the lower your credit score, the harder it becomes to borrow money affordably when you need to.

If you’re eager to get out of credit card debt, try getting on a budget and cutting expenses to free up cash. You can also try getting a second job to drum up the money to pay your debt off. That may or may not be an easier route to take than slashing your spending, since inflation has been driving expenses upward — because while we did see inflation cool in March, it’s still higher than normal.

Of course, another helpful move might be to transfer your existing credit card balances over to a new card with a 0% introductory APR. That way, you’ll get a limited reprieve from racking up interest as you work your hardest to chip away at your debt.

We don’t know how the Fed is going to react to the latest CPI reading. But even if the central bank pauses its interest rate hikes for the time being, it’s still a good idea to do what you can to shake your credit card debt — before you end up spending a lot of money on interest that you’d rather spend in other ways.

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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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If you’ve ever thought of buying a primary residence as making an investment, you may want to reconsider. Keep reading to learn why. 

One of the comments you’re sure to hear frequently if you’re a renter is that buying a home is an investment (and renting is “throwing money away”). On its surface, this comment makes some sense. After all, when you buy a home, you’re spending money for an asset that appreciates in value and that you could someday sell for money. Yes, all this is true. But here’s why you shouldn’t really consider your primary residence in quite the same investment class as the stocks in your brokerage account.

It’s first and foremost a place to live

If you live in a house you pay on a mortgage loan for, I’m willing to bet that when you were house hunting, you were looking primarily for a place to live for you and potentially your family, not a place that would be an investment. Homes you buy to rent out don’t have to be appealing to you personally, they just have to make you money. For example, the house you buy to rent out to tenants might be a multifamily home in a part of town where there are a lot of renters. Whereas, you perhaps live in a neighborhood of smaller single-family homes where most are owner-occupied.

Your home likely isn’t going to generate a lot of cash flow

Yes, your home certainly can generate some cash flow. If you have extra space — say, a garage you don’t use — you could rent it out. Or maybe you have a finished basement and you rent that out on Airbnb because you live in a touristy area. But again, if you and your family live in that home, that’s likely the most important thing to you and your bottom line. And remember, your home is a large expense in and of itself.

If you sell, you’ll still need to find a place to live

If you put your home on the market tomorrow, you wouldn’t be free and clear, cash in the bank. You’d still need to find another place to live and would have to rent a home or buy another one. But if you sell your stock holdings, you won’t need to buy more or risk your family’s health and happiness.

Homes may not steadily appreciate in value

This one may hurt some people to hear, but dig this: Homes don’t always gain value. While by and large, yes, homes appreciate over time (and especially the land under them; a house must be maintained and kept in good shape to gain value), home values and sale prices are coming back down after a few years of frenzied pandemic home-buying. I guess in this respect, a house has more in common with a volatile stock value than those who call a home an investment might have intended!

Homes aren’t a liquid asset

One final reason it’s best not to think of your primary residence as an asset, per se, is because of its illiquidity. Cash is the most liquid asset of all, followed by bonds, stocks, and then real estate. You can turn an investment like stocks or bonds into cash more easily than you can turn a house into cash. You might not get as much money for bonds and stocks as you paid, but you won’t have to get them into sellable condition, find a real estate agent (or go the FSBO route), market them, wait for a qualified buyer, wait for that buyer to get their financing in order, and so on.

For all of these reasons, be wary of anyone who tells you to buy a primary residence because of its nature as an investment. Buy a house because you want a long-term place to live for yourself and for the people (and maybe pets) you care about.

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A new personal finance tool called Flex Index is helping jobseekers find remote and hybrid work arrangements. Read on to find out how the tool can help you. 

Finding true remote work — a job that lets you work from home five out of five days per week — is finally getting easier.

Early this year, Scoop, a tech company that offers scheduling products for hybrid workforces, launched a powerful search tool that can help you find remote work fast.

Called “Flex Index,” this personal finance tool catalogs companies by their work arrangements. Fully remote companies are called out as such, while companies with minimum office days are cataloged with specific details.

For jobseekers on the search for fully remote work, the Flex Index can help you avoid awkward job interviews in which you’re told there’s no remote work, even though you stated work from home was important to you on your application. It can also put to rest those horribly vague answers — “we offer some remote work ” — that leave you wondering if the job is even worth pursuing.

How does Flex Index work?

To be sure, the Flex Index isn’t a job board: It doesn’t tell you who’s hiring right now, nor does it list open positions (not yet, at least).

Instead, the Index tells you a company’s work-from-home policy, which it will label as one of these six categories:

Fully remote: No office work. Employee’s choice: You get to choose when you work in the office. Minimum Days/Weeks: You must report in office a minimum number of days, but you get to choose when.Specific Days/Weeks: You must report in office on specific days, such as every Tuesday and Thursday. Minimum % of the time: You have to be in office for a percentage of the week, month, or year, but you get to choose when. Full time in office: No remote work (boooo).

As of April 2023, the Index can give you information on 4,158 companies, such as Airbnb, 24 Hour Fitness, Internal Revenue Service, Tesla, and MLB. You can also filter companies by industry, size, and location of headquarters.

How can you use Flex Index to find a job?

Since the Flex Index doesn’t tell you which companies are hiring, you have to get creative.

One approach is to use the Index to narrow down companies whose jobs you later apply to. This works well if you want to work within a clearly defined industry, such as hospitality, health, or real estate. It might also work well if you want to find employers who offer remote work in your city or state.

Narrowing down by industry, however, doesn’t work if you’re looking for a specific job. For instance, you can’t filter employers on Flex Index by those that hire writers, designers, lawyers, QA engineers, and developers. Instead, you’ll have to use Flex Index in reverse, that is, look for companies hiring for your role, then check Flex Index to find out what their work-from-home policy is (if the company is registered).

Is Flex Index accurate?

The Index compiles data from online surveys filled out by former and current employees, so it’s only as accurate as the employees report. Once the Index lists a company’s work-from-home policy, however, it reaches out to the company’s executives. The executives then have an opportunity to edit the information, or add any clarifications.

Will Flex Index add more companies in the future?

Yes, it’s likely the index will add more companies as the tool becomes more well-known.

In fact, if you’re working for a company that Flex Index hasn’t yet registered, you can request to add its work-from-home policy. You can also check companies that are registered (and for whom you currently work for) to see if its data is accurate.

Flex Index: flexible work is here to stay

If you’re afraid remote work was a pandemic trend, the parent company of Flex Index — Scoop — has good news for you: Based on recent data, it appears around 82% of companies founded post-2000 will offer flexible work arrangements in the future, with around 53% founded before 2000 embracing full flexibility.

So no — you don’t have to settle for an office job because you think it’s mandatory for a decent wage. Remote and flexible work arrangements can improve your health and well-being as much as they can your personal finances, and you don’t have to take a pay cut to work remotely. Keep tabs on the Flex Index companies that are hiring remotely, and when new jobs open, don’t hesitate to jump ship for a position that works better 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.The Motley Fool has positions in and recommends Tesla. The Motley Fool has a disclosure policy.

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