Money Management

Repeat after me: Credit cards are not evil. 

Credit cards have a bad reputation among some of the bigger-name finance gurus. And perhaps this isn’t so surprising. Credit cards can make it easy to overspend, and the interest charged on a balance you don’t pay off in full can be upwards of 20% APR. This can make it extremely difficult to get out of debt, and as someone who’s been there, I can tell you that it’s best avoided.

With this in mind, it might be surprising to learn that Tori Dunlap, the founder of Her First $100K and author of The Financial Feminist, is very pro–credit card. In fact, she’s never used a debit card to pay for anything. Here’s why Dunlap keeps her debit card in a drawer, preferring to rely on a credit card for everything.

Debit cards aren’t as secure as credit cards

Despite having some of the same visual characteristics as your credit card, a debit card is used to directly access the money in the bank account you have linked to it. This leaves you especially vulnerable if thieves or scammers gain access to your debit card or the information contained within it. For this reason, it’s a particularly bad idea to use your debit card to shop on Amazon or other e-commerce sites, for example.

The consumer protections on credit cards are a lot more robust (for many, you have $0 liability for fraudulent charges). And credit cards aren’t tied to your bank account, but to a line of credit through the issuer.

Debit cards usually don’t offer rewards or cash back

While rewards debit cards do exist, they are few and far between. If you want to earn points, airline miles, or even just simple cash back on your everyday purchases, credit cards are the way to go.

Dunlap mentioned in a recent episode of her podcast that she earns hundreds of dollars in cash back on credit cards every year. And there’s truly a rewards credit card for nearly every spending category. Are you like me and enjoy making it rain at grocery stores? There’s a grocery rewards credit card out there for you.

Debit cards don’t help you build credit

If you’ve ever struggled with your finances, chances are you’ve tried to pretend your credit score doesn’t exist. I probably don’t need to tell you that’s not a productive way to improve your score, but you know what is? Using credit cards responsibly.

If you pay for purchases with your credit card and then pay off that balance every month, you’ll show creditors (current and future, when they check your credit score the next time you apply for an auto loan or a mortgage) that you know how to handle borrowing money. Debit cards don’t give you this chance, because again, they’re tied to your own money.

Debit cards don’t track your spending as clearly as credit cards

If you use your debit card to make purchases, you can pop into your bank statement or your bank’s website to see where the money went. But your credit card account will categorize your purchases for you, making it far easier to manage and track them. This can in turn make it less onerous to compare your budget to your actual spending and adjust accordingly.

A few instances where you might want to use a debit card

None of this is to say that debit cards are bad, or that you shouldn’t ever use one. Dunlap herself acknowledges this, noting that if you’re struggling with credit card debt, a debit card can be a great way to stay on track (and keep you from racking up further charges on your credit cards if you’re in the process of paying them off).

Plus, a debit card can also function as an ATM card, meaning it can let you take out cash without having to visit your bank during its normal business hours. If you need access to cash, it’s a good idea to keep your debit card around. But due to its less-robust security features, perhaps don’t keep it in your wallet, and instead take it with you to the ATM every so often to get cash out.

Despite my own history with debt, I’ve recently become someone who pays for everything with credit cards (and then pays off the full balances, often weekly), just like Tori Dunlap. I like the security features, I like the cash back, and I like keeping fewer bits of numbered plastic in my wallet. You might want to consider giving your debit card a rest, too, for all these reasons.

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

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Takeout can be an inexpensive dinner option if you take advantage of meal deals. 

Sometimes, even if you plan well and have a fully stocked fridge, takeout is the most convenient solution to quickly get dinner on the table for your family. Luckily, takeout doesn’t have to break the bank. Several restaurants and fast-casual eateries offer family meal deals that cost $40 or less so you can fill everyone’s bellies without disregarding your personal finance goals.

1. Panda Express

You can feed the entire family for $35 at Panda Express. Instead of ordering individual meals for everyone, order off the family meal menu to stay on budget. With a family meal, you’ll get three large entrees and two large sides for this price. While a few entree options have a small upcharge, many don’t. Give it a try the next time you need a quick meal for the whole family.

2. Chili’s

While Chili’s doesn’t have a family meal menu, the popular restaurant chain has a party platter menu. There are a few options available that will feed your entire family for less than $40. These will satisfy your taste buds without taking all your money:

Party Platter Quesadilla Explosion Salad: This grilled chicken salad comes with cheese quesadillas and serves eight people for $32.39.Cajun Chicken Pasta Party Platter: This family-size pasta dish features grilled chicken with an alfredo sauce and serves four people for $24.Party Platter Big Mouth Bites: You’ll get twelve mini beef burgers topped with bacon, American cheese, sauteed onions, and ranch for $24.

3. Panera Bread

Panera is another option to explore for an affordable family takeout night. You can save money by ordering from the Family Fast Value Meals. Here are a few options:

Three Flatbread Pizza Family Feast: Choose three flatbread pizzas and two whole salads and feed four to six people for $31.30.Family Feast: Choose four half sandwiches, one whole salad, and one quart of soup. This meal deal also includes a whole French baguette for a total cost of $31.30.Premium Family Feast: Choose four half sandwiches, one whole salad, and one quart of soup. This meal deal also includes a whole French baguette and four chocolate chip cookies for $39.30.

4. Boston Market

Boston Market also has affordable family meal options. Prices vary depending on your order, but several family meals cost $40 or less. Here are a few family meal options to consider the next time you need a quick dinner idea that won’t leave you feeling broke or hungry:

Rotisserie Chicken for Four: This meal includes a rotisserie chicken, four pieces of cornbread, and four large sides for $35.99.Home Style Meatloaf for Three: This meal comes with meatloaf, four pieces of cornbread, and three large sides of your choosing for $27.99.Two Meat Family Meal Combo: Choose two types of meats, four large sides, and eight pieces of cornbread for $36.79.

5. Pizza Hut

The Big Dinner Box from Pizza Hut is the perfect solution for an affordable pizza night for the whole crew. You’ll get a variety of food that will satisfy even your pickiest family members for a low price. The Big Dinner Box includes two medium one-topping pizzas, five breadsticks, and a choice of pasta or wings, or you can skip the sides and get three medium one-topping pizzas. The best part is it only costs $25.99, so you’ll still have money in your checking account.

Get creative to save on food costs

These are just a few options to consider the next time you need to get dinner on the table quickly without overspending. In some cases, it may be cheaper to order a takeout meal than to head to the store at the last minute to load up on expensive ingredients needed to make dinner. Don’t miss out on money-saving food deals like this.

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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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Competition has driven banks to increase rates. 

A certificate of deposit (better known as a CD) is a type of bank account that offers you the chance to earn a decent interest rate on your money in exchange for locking it in place for a period of time (often ranging from six months to several years). Right now, the best CD rates are over 4%, which is a startling development. Just a few years ago, at the start of the COVID-19 pandemic, rates were well under 1%. How do we account for this change, and how do you choose the right CD for your money? Let’s find out.

Higher rates on CDs attract more customers

Consumers have a lot of good options right now when it comes to growing their money. You might consider Treasury bills, I bonds, or even a good old high-yield savings account, and you’ll see a much more generous return than savers have gotten in years. The variety of choices available has meant that commercial bank deposits fell in 2022 for the first time since 1948, according to FDIC data.

This is a serious problem for banks, which are bracing for an economic slowdown. Smaller banks may be in real trouble, as a lack of deposits can impact their profitability. So it stands to reason that in order to get more money through the door, so to speak, banks are improving their APY offerings to attract customers. And CDs in particular can be a great boon for banks. This is because when you open a CD account, you’re agreeing to leave it in place for a set period.

How can you take advantage of higher CD rates?

A CD can be a great place for money you need in the next few years, but not immediately. If you leave it in your checking account, it likely won’t earn interest, and if you want to avoid the possible temptation to spend it, the penalty you’ll incur for withdrawing early from a CD account will likely give you pause. It will typically amount to one or more month’s worth of interest earned on your money. And if you decide to withdraw early, you have to take all of the money out — you can’t leave part of it behind to keep earning interest. Depending on how much you have in the account, that loss of interest could be a significant amount of money.

Consider your timeline when looking to open a CD. If you’ve got a chunk of money saved for a home purchase in, say, a year, check out rates for 12-month CDs. If you’d rather split up your cash into multiple CDs with varying maturity dates, you could build yourself a CD ladder. This is a good strategy for right now, when interest rates are rising and you will have money available at regular intervals to put back into new CDs (or use, if you need the cash).

Don’t lock your money up in a CD if you’ll need it sooner rather than later. A CD is not a good place for your emergency fund, for example. For money you need access to on the fly, a high-yield savings account is a better choice.

If you’ve never considered opening a CD before, now is a good time to think about them. It’s hard to say what developments are upcoming for the U.S. economy, and the banking industry in particular, but one silver lining of higher interest rates is better rates on CDs.

These savings accounts are FDIC insured and could earn you 13x your bank

Many people are missing out on guaranteed returns as their money languishes in a big bank savings account earning next to no interest. Our picks of the best online savings accounts can earn you 13x the national average savings account rate. Click here to uncover the best-in-class picks that landed a spot on our shortlist of the best savings accounts for 2023.

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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