Money Management

There are two crucial moves to make in this situation. 

At this point, we’re inching closer and closer to the April 18 tax-filing deadline. If you’re 95% done with your taxes, you’re in pretty good shape. But if you’re hovering around the 30% mark, well, let’s face it — things aren’t looking as good.

Being late with a tax return could have serious financial consequences. So if you really don’t think you’ll be done with yours by April 18, it pays to request an automatic extension. But that’s not the only move you should make.

Get yourself that extra time

When you’re late with a tax return and you’re due a refund, there’s no specific penalty for submitting your taxes past the deadline. The logic is that the longer it takes you to file your return, the longer the IRS gets to hang onto your refund rather than transfer it into your bank account. That only hurts you.

But if you owe the IRS money, filing a tax return late could cost you a lot of money. You’ll be hit with a failure to file penalty equal to 5% of your unpaid tax bill for each month or partial month your return is late, up to a total of 25%. So as an example, if you owe the IRS $2,000 and are 24 days late with your tax return, you’ll be penalized 5% of that $2,000, or $100.

That’s why you should always request an extension if you’re running into the tax-filing deadline and don’t think you’ll make it. An extension will give you an extra six months to file your taxes without facing the failure to file penalty.

Estimate your tax bill — and pay it by April 18

A tax extension will give you more time to submit your tax return, but it won’t give you extra time to pay your tax bill. So if you know you won’t make the deadline, do your best to estimate your tax payment owed, and send the IRS that money by April 18.

If you’re late paying a tax bill, you’ll be charged a late payment penalty equal to 0.5% of your debt per month or partial month your return is late, up to 25%. You’ll also start to accrue interest on your unpaid taxes.

Clearly, this penalty is much lower than the failure to file penalty. But it’s one worth avoiding regardless.

Now, you may be thinking, “If I don’t have my tax return ready by April 18, how will I know how much to pay?” That’s why your best move is to estimate your bill based on what you do know. If you wound up owing the IRS $2,000 last year, and your income increased slightly this year without having more tax withheld along the way, you may want to send the IRS $2,500 in case your tax bill is higher.

All told, it’s generally best to get your taxes done on time — whether you’re due a refund or have to write the IRS a check. But if that ship has basically sailed this year, your next best move is to file a tax extension and send the IRS some amount of money if you’re convinced you’re going to owe.

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For some, “budget” is the worst b-word! 

While most of us know we should budget, studies show more than half of us simply don’t. But why?

Budgets are boring. At least, that’s their public image. Be honest: When you hear the word “budget,” I bet you’re picturing some number-cruncher with pages of spreadsheets and bad hair.

Budgets are restrictive. That’s what many folks think. If you make a budget, it’s just going to be a reminder that you shouldn’t spend so much money, especially on all the things that make your life enjoyable.

In reality, budgets don’t need to be either of those things. They’re merely a personal finance tool to help you get a handle on where your money is going — and where it needs to go. Here are a few ways to make it painless (or, at least, as painless as possible).

1. Use a mobile app

There are a ton of great budgeting apps out there that can make organizing your finances remarkably easy. Many of them even connect to your credit cards and bank accounts so you can import your transactions right into the app.

The best app for you will depend a lot on which budgeting style you prefer. You can try a few different apps to find one that best meshes with your lifestyle.

2. Automate (almost) everything

If there’s one thing infomercials have taught us, it’s that we really like to “set it and forget it.” So why not apply that to budgeting?

Most checking accounts will let you set up automatic transfers. So, get a few different savings accounts, one each for your different expenses (e.g., one for bills, one for groceries, etc.). Then, set up automatic transfers so that each paycheck is automatically split into the different accounts.

With this method, your budgeting basically takes care of itself. You can make necessary payments from the dedicated accounts, and what remains can be your fun money.

Pro tip: Make sure you choose a high-yield savings account for your longer-term savings goals, like a house down payment or emergency fund. This will ensure you’re getting the best return on your savings.

3. Gamify it

One of the best ways to combat the idea that “budgeting is boring” is to make it, well, less boring. And for some folks, the best way to do that is to gamify it.

Set up a goal-reward system. For instance, every time you sit down and go through your budget, reward yourself with an hour of trashy TV. Or, maybe every time you hit a savings goal, you treat yourself to a dinner out.

We’re all motivated by different things. So find something that will motivate you to keep going, then decide what tasks you’ll need to complete to earn it.

4. Pare it back a bit

A useful budget doesn’t have to be about having a line item for every latte. Instead, you could simplify your budget down to just the basics — or even just one or two things.

For example, one popular type of “anti-budget” is to simply set a savings goal and automate the transfer. Once you have that coming out of your paycheck every two weeks, the rest of the money gets spent however it needs to be.

Of course, it doesn’t need to be that simple, either. Maybe you just need a budget with a few items — bills, housing, savings — and the rest can be dictated by whatever’s leftover. It’s really up to you.

5. Change your perspective

You may not actually hate the idea of budgeting, so much as you hate “budgeting.” In other words, folks can have a lot of negative associations with the word “budget,” such that the word itself can be a turn-off.

So don’t call it that. Give it another name, something empowering that will encourage or inspire you. Here are a few alternatives that I particularly like:

A Financial Plan for World DominationMy Guide to Kicking Poverty’s ButtHow I Will Get Rich and Die HappyStep-by-Step Plan for Getting a SupercarA Guide to Get Me to Europe

The whole idea is to remove the stigma from budgets. Because they’re not about boring spreadsheets or restrictions. They’re about making the most of your money.

A little of this, a little of that

For many folks, the best strategy may be a combination of approaches. Perhaps you have a barebones budget for just the major things. Set up a separate account where that money can live, then set up automatic transfers so the money goes there without you needing to do a thing. Then, the money that remains can go to whatever you wish.

In the end, there’s no single budget method that’s going to work for everyone. But avoiding any type of budgeting because one method isn’t appealing isn’t the way to go, either. Give different approaches a try. You may stumble across something that changes your financial life for the better.

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It’s a solid strategy worth employing. 

The stock market has delivered an average annual return of 10% over the past 50 years, assuming we’re measuring the broad market’s performance by the S&P 500 index. That’s not a bad benchmark to follow, though.

The S&P 500 consists of the 500 largest publicly traded companies. So often, when you hear things like “the stock market fell today” or “the stock market rose,” what it really means is that the value of the S&P 500 index declined or inched upward.

For many people, investing in the S&P 500 itself is a great way to grow wealth over time. So you may be inclined to load up your portfolio with S&P 500 ETFs. But if your goal is to beat the market, then you’ll need to take a different approach.

What it takes to beat the market

When we talk about beating the market, we basically mean having a portfolio whose gains outpace that of the stock market on a whole, as measured by an index like the S&P 500. So remember how we said the S&P 500 has delivered an average annual 10% return over the past five decades? If you were to build a portfolio that generates an average yearly return of 12%, you’d be beating the market.

How do you do that? It’s not easy by any stretch of the imagination, but there are two important things you’ll need to do.

First, you won’t be able to just fall back on shares of a broad market ETF. Instead, you’ll need to hand-pick individual stocks for your brokerage account. Specifically, you’ll need to do a lot of research to make sure you’re focusing on quality businesses with the potential to grow and see their share price increase significantly over time.

The second part of the equation involves adopting a strategy called buy and hold. And it’s a simple one. You buy shares of quality businesses and then hold them for years — many, many years, if you can. Over time, the value of your shares is likely to increase if it’s truly a quality business, thereby allowing you to outpace the market and feel really good about the wealth you’ve managed to accrue.

Make sure your portfolio is diversified

Hand-picking stocks and holding them for many years could make it possible to grow more wealth than the average investor who puts money into the S&P 500 alone. But it’s also important to make sure you’re loading up on a nice mix of stocks across a range of market sectors.

The nice thing about broad market ETFs is that they do that work for you. When you’re buying individual stocks, you need to be careful about branching out into different segments of the market. But if you make a point to maintain a balanced portfolio, you’ll be able to buy yourself some protection from losses, all the while potentially setting yourself up for a lot of upside.

Best of all, many brokerages today allow you to buy stocks on a fractional basis. That makes it even easier to diversify your portfolio, since you don’t have to commit to full shares for stocks with high price tags.

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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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How many of these appeal to you? 

There’s a reason so many people are willing to keep paying for a Costco membership. That fee gives you access to a wide range of products, like bulk groceries and household essentials.

But Costco is more than just a grocery store. It carries everything from clothing to toys to books to gadgets. And shopping there often means getting to save money on the things you’re buying.

Meanwhile, Costco offers its share of limited-time deals that rotate from month to month. Here are some of the bargains you may want to take advantage of in April.

1. $800 off a Cambria leather sofa

Ready for a furniture upgrade? If you’ve been boosting your savings account to purchase a new sofa, you may want to consider this model being offered by Costco at a discount. The Cambria sofa is made of top grain leather and comes in cream or dark brown. Your final price at Costco includes delivery and setup of your sofa.

2. $100 off the Dyson Cyclone V10 Animal + Cordless Vacuum Cleaner

Many people associate spring with ramping up on the cleaning front. So if you want to focus on cleaning your floors, it pays to scoop up this Dyson vacuum while it’s being offered at a lower price. Its features include three separate cleaning modes and up to 60 minutes of runtime. It’s also fairly lightweight, making it easier to get the job done.

3. $6 off an 18-count of Orgain Plant-Based Protein Shake

If you follow a vegan diet and find yourself craving easy meals or snacks on the go, these chocolate-flavored shakes might fit the bill. They come packed with 20 grams of plant-based protein and contain no sugar, artificial colors, or sweeteners. They’re also gluten- and soy-free, and each serving contains 11 fluid ounces.

4. $4.50 off Bounty Prints Select-A-Size Paper Towels

Getting back to the whole cleaning theme, if you’re someone who takes their paper towels seriously, then you know Bounty is basically the gold standard when it comes to absorbance. You can now save on a 12-pack of select-a-size rolls, which give you the flexibility to tackle spills both minor and major.

5. $150 off the Lenovo IdeaPad 3 15.6″ Touchscreen Laptop

If you’re looking for a moderately priced laptop that won’t result in a ridiculous credit card tab, then this Lenovo model is worth trying out. It features a backlit keyboard and comes with Microsoft® Windows 11 Home. And when you buy this laptop at Costco, you’ll get a two-year warranty and free technical support.

A lot of people are trying to limit their spending this year as inflation continues to rear its ugly head. If that’s the case, then a new sofa purchase or laptop may not be in the cards. But you may want to consider loading up on things like paper towels while they’re available at a discount — especially if you have kids or pets at home who tend to make a mess.

It also pays to compare Costco prices online with what you see at your local warehouse store. In some cases, making your purchases in person will allow you to save even more money than shopping at Costco online.

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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 positions in Microsoft. The Motley Fool has positions in and recommends Costco Wholesale and Microsoft. The Motley Fool has a disclosure policy.

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