Money Management

At this point, it’s time to get serious about retirement savings. 

Seniors who retire on Social Security alone often struggle financially. Those benefits are only designed to replace a small portion of your paycheck. If you want to live comfortably as a retiree, you’ll need to amass some savings.

By age 50, you should, ideally, have a decent amount of money saved up in your IRA account. But what if that’s not the case?

Many people struggle to save for retirement at different stages of life for various reasons. Your 20s may have been plagued by credit card debt you struggled to shed. You may have spent your 30s scrambling to cover your mortgage payments while paying for childcare. And you may have been more focused on building college savings for your kids in your 40s than funding your own retirement nest egg.

If you’ve reached the age of 50 without having put any money into your IRA, then let’s be real — that’s not a great situation. But that doesn’t mean it’s not a salvageable one.

How much should you have in your IRA by age 50?

Fidelity says that by age 50, you should aim to have six times your annual salary socked away for retirement. So if you earn $80,000 a year, that means you’d ideally be looking at an IRA balance of $480,000. If your balance is $0, well, there’s really no way to sugarcoat it — it’s a far cry from where you probably want to be.

But the good news is that being 50 means you still probably have a nice chunk of time left in the workforce. And if you make the decision to prioritize your retirement savings, you’ll have a nice opportunity to catch up.

As such, take a look at your expenses and commit to slashing a few of them. This doesn’t necessarily mean you should sell your home, uproot your family, and downsize while you still have teenage kids living at home. But what you may want to do is trade in your car for one that’s less expensive, dine out once a month rather than twice a week, and cancel any services or subscriptions you can manage to do without, whether it’s a gym membership or a meal kit delivery.

At the same time, you may have to come to terms with the idea of getting a second job to catch up on IRA contributions. If you’re 50 with no savings for retirement whatsoever, you’ll really want to do your best to max out. And a second job might enable you to do that so you’re not forced to change your lifestyle too drastically.

This year, IRAs max out at $7,500 for workers ages 50 and over. Let’s assume this limit doesn’t change from this point onward, and you max out your IRA for the next 15 years. If you also manage to invest your IRA at an 8% average annual return, which is a bit below the stock market’s average, as measured by the S&P 500 index, you’ll end up with almost $204,000. And if you’re willing to work and save until age 70, you’ll be looking at a balance of around $343,000.

It’s time to buckle down

If you’ve yet to fund your IRA thus far, don’t beat yourself up. You’re by no means the only person who’s 50 years old without money set aside for retirement, and you may have fallen on some hard times throughout adulthood that made funding an IRA difficult.

But at this point, it’s important that you prioritize your IRA contributions, even if it means taking on a second job or cutting back on spending. If you don’t bring some savings with you into retirement, you might struggle to cover even your basic expenses. And that’s not a lifestyle you want.

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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 no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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Go big or go home. 

If you want a higher credit limit, most card issuers let you request it online or by phone. Not only is this a way to get more spending power with your credit card, it could also be good for your credit score.

When you try to increase your credit limit, some card issuers ask you the credit limit you want. This can be a tricky question. It’s hard to know how much you should ask for, and if it’s better to aim high or be more conservative. You may also wonder what would happen if you asked for a huge increase. Will it ruin your chances of getting anything?

I recently found myself in this exact situation, and I decided to ask for a very high credit limit. Here’s why I think that’s a better approach and what happened with my ambitious request.

Why it’s good to aim high with your credit limit

Your credit limit is important, first and foremost, because it determines how much you can spend with your credit card. If you spend about $5,000 per month, but your card has a $2,000 limit, then that’s going to be inconvenient for you.

In addition, your credit limit also plays a large role in your credit score. One of the factors that matters most in your credit score is your credit utilization ratio. This is the ratio between your credit card balances and your credit limits, and the lower the ratio is, the better. It’s generally recommended to maintain a credit utilization below 30%.

It’s easier to maintain low credit utilization if you have high credit limits. For example, if you have a $10,000 credit limit, you ideally should keep your balance below $3,000. But if you have a $50,000 credit limit, that 30% threshold pushes up to $15,000.

That’s why you should ask for a higher credit limit at least once a year. Now, some card issuers only let you put in a request, and if they approve it, they decide how much to give you. Others go a step further and ask how much credit you want.

If your card issuer asks how much credit you want, don’t be afraid to ask for a large amount. Your card issuer probably already has a maximum it’s willing to offer you. Let’s say that number is $20,000. Here’s what’s most likely going to happen based on how much you ask for:

If you ask for more, such as $30,000, your card issuer will counteroffer $20,000.If you ask for less, such as $15,000, your card issuer will simply accept that amount.

As you can see, by going too low, you could miss out. When you aim high, you might not get the full amount you asked for, but you’ll probably get the maximum your card issuer is willing to give you.

What happened when I asked for a $100,000 credit limit

I’ve had a Capital One credit card with a $30,000 credit limit for over a year. Since I’ve always paid the bill on time and I’ve increased my income, I decided to log into my account and request a higher credit limit.

There were a few questions, including my annual income and my maximum desired credit line. At first, I thought about asking for another $10,000 or $20,000. But then, I figured, why not just go for an even $100,000? I don’t need that much, by any means, but I decided to make the most of my request. And I won’t lie, I thought it’d be cool to have that much credit on a single card.

Unfortunately, Capital One didn’t exactly meet me in the middle. It offered me a whopping $1,000 increase. I asked for $100,000 and got $31,000 — not exactly a huge success.

Don’t let my story discourage you, though. That just means my credit limit is already near the max that Capital One is willing to offer me. It did start me out with a generous limit, to be fair, as I had a high credit score when I originally applied for the card.

There’s no guarantee that your card issuer will approve a credit limit increase request. But it’s more likely if any of the following are true:

Your credit score has increased.Your income has increased.You’ve used the card regularly and paid on time for six to 12 months.

It’s good to have more credit than you need. You’ll have more spending power if you’re ever in a pinch, and it keeps your credit utilization low. Ask for the occasional credit limit increase to ensure you always have enough.

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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.Lyle Daly has no position in any of the stocks mentioned. The Motley Fool has no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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Pet insurance companies can (and do!) deny coverage. 

So you’re a pet owner, and your pet has a medical condition. You want insurance to pay for their treatments, but you’re facing a problem: Most insurers don’t cover sick pets. Specifically, they don’t help you pay for medical issues the vet has already diagnosed your pet with.

You’re not alone. According to Pawlicy Advisor data, about one in 10 people searching for pet insurance have pooches with pre-existing conditions. Most can find insurance coverage but will struggle to find insurers that will cover their pet’s pre-existing conditions.

Don’t throw in the towel just yet! There are exceptions to this seemingly ironclad rule. Here’s what you need to know.

Pet insurance doesn’t cover ongoing medical conditions

If your pet has been diagnosed with a persistent disease, you probably aren’t going to find an insurance policy that covers it. Pet insurers don’t want to pay for expensive medical procedures. They can and frequently do deny coverage for a pre-existing medical condition.

If your pet is sick, you still have options. You can apply for a Pet Assure membership that gives you discounts on all medical treatments, even ongoing ones. And you can buy a pet insurance policy that covers unrelated health issues.

In most cases, pet insurance policies don’t cover illnesses that a pet is already experiencing. But healthy pets can find coverage for their “cured” issues, in some cases.

Some insurers cover “cured” medical conditions

Some pet insurers distinguish between curable and incurable medical conditions. These companies may insure curable medical conditions.

Conditions often considered curable:

InfectionsDiarrheaVomiting

The best pet insurance for pre-existing conditions offers coverage for some symptom-free pets. If a qualifying pre-existing medical condition pops back up, these insurers will help cover costs.

What’s the catch?

Insurers who cover curable conditions typically require pets to be symptom-free for one or two years. So if you want insurance to cover your pet for any future vomiting episodes, you’ll need your pooch to stop yakking on the rug for 12 to 24 consecutive months.

Plus, you should expect your insurer to ask you for proof that your pup or feline friend is healthy and is cured. That means taking your pet to the vet for a medical exam.

What about incurable conditions?

If your pet has been diagnosed with incurable conditions like allergies, arthritis, or hip dysplasia, insurers likely won’t cover treatments for those issues. To get insurance covering incurable diseases, you must buy a pet policy before the vet diagnoses your pet.

Should I buy insurance for a sick pet?

This depends on your goals. Some insurers will cover pets “cured” of former conditions. If you think your pet may relapse, it may be worth looking into appropriate pet policies.

If your pet is sick right now, insurance won’t pay for whatever their condition is. But you can still buy a policy to help you cover unrelated things. To put it bluntly, you can still buy insurance covering accidents or cancer treatments if your pet has chronic diarrhea.

Preventative pet insurance policies take things a step further; they help your pet keep from getting sick in the first place. They do this by covering the cost of routine care like vaccines, teeth cleanings, and regular blood work. These are treatments and tests that keep you and your pet happy.

A pet health savings account

You can build an emergency fund for your pet. That way, you can pay off unexpected medical bills without selling investments or taking out loans. Most pet insurance plans don’t cover 100% of veterinary bills, so an emergency fund can bridge that gap.

Deposit emergency savings in a high-yield savings account. That way, you’ll earn interest on the money saved. Consider setting up automatic deposits to save quickly, and ensure your bank allows you to withdraw your emergency funds anytime.

Bottom line: Know your budget

Pet insurance keeps pet expenses predictable, and some insurers cover some pre-existing conditions. Consider your budget and how far you will go to pay your pet’s medical bills. Decide early, so you don’t have to choose between your bank account and your furry friend.

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While some progress has been made to make insulin more affordable, more needs to be done. 

Due to the high cost of healthcare in the United States, many Americans struggle to afford medical expenses. Those with serious health concerns like diabetes may have to cut out other necessary expenses to afford their life-saving medications. Bernie Sanders recently introduced legislation to make insulin more affordable for people with diabetes.

Bernie Sanders wants to do more to lower costs

Senator Bernie Sanders, the Senate Health, Education, Labor, and Pensions Committee chairman, and Congresswoman Cori Bush recently introduced legislation to make insulin affordable for more Americans, so no one has to ration their insulin due to financial concerns. The Insulin for All Act of 2023 aims to cap the list price of insulin at no more than $20 per vial.

In a March 9, 2023 press release, Sen. Sanders said, “There is no reason why Americans should pay the highest prices in the world for insulin — in some cases, 10 times as much as people in other countries.”

Congresswoman Bush noted,” As a nurse, I’ve seen too many people in our communities struggle to afford their life-saving insulin medication. People are left choosing between insulin or groceries; insulin or rent; insulin or child care. This is unacceptable.”

More than 7 million people throughout the United States rely on insulin. In 2022, 1.3 million Americans were forced to ration insulin because of the high cost. This proposed legislation could help more Americans afford this necessary drug if passed. However, it’s unlikely that the Republican-led House of Representatives will support this measure.

Some progress has been made to reduce insulin prices

Some progress has been made in reducing the costs of insulin. In his 2023 State of the Union Address, President Bident called on Congress to do more to cap out-of-pocket insulin costs for all Americans. While the Inflation Reduction Act capped insulin prices for Medicare recipients, consumers without insurance or with private insurance didn’t benefit.

On March 1, 2023, manufacturer Eli Lilly announced it would reduce the list price of its most commonly prescribed insulin by 70%. Out-of-pocket costs will be capped at $35 at participating pharmacies for those with commercial insurance. People with no insurance can download the Lilly Insulin Value Program savings card to receive Lilly insulins for $35 a month.

In 2022, legislation was passed that capped out-of-pocket insulin costs for Medicare Part D and Part B recipients. The Inflation Reduction Act requires Medicare monthly insulin costs to be capped at $35. This will help many seniors keep more money in their checking accounts.

The fight continues to make insulin affordable for all

Hopefully, more progress will be made to reduce out-of-pocket insulin costs for the average American. No one should have to go without medication — but many do. According to a 2022 Policygenius study, 32% of Americans with health insurance said the prescription costs prevented them from taking the full dose of prescribed medication. That’s a terrifying statistic.

It’s not uncommon for Americans to struggle to afford their prescriptions. Many people rely on resources like GoodRx to save money on prescription drug costs. The Mark Cuban Cost Plus Drug Company has also become a valuable resource for Americans looking to save money. The online pharmacy hopes to offer low-cost insulin to the public as soon as possible.

If you’re going through a difficult financial situation, please know you’re not alone. Many Americans are on a tight budget and struggle to afford everyday living costs. If you’re looking for more ways to save money, check out our personal finance resources.

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If any of these ring true, it may be time to call it quits with Costco. 

Costco is a favorite of many shoppers, and it’s easy to see why. It offers low prices, a fantastic product selection, and a generous return policy. The food court and its $1.50 hot dog and soda combo are a hit, too.

To shop there, you need a Costco membership. That costs either $60 for a Gold Star membership or $120 for an Executive membership. While a membership is worth it for Costco fans, there are situations where you’re better off saving your money and shopping elsewhere.

1. You’re spending too much

Since Costco is known for competitive prices, people often assume they’re saving money there. But there are also ways that Costco can get you to overspend. For example, free sample stations convince shoppers to make impulse purchases. Plus, large product sizes get you to buy more than you need.

If you’re shopping at Costco to save money, make sure you’re actually saving money. If your grocery bill is the same or higher than usual, then your Costco membership isn’t doing you any good.

2. You no longer live close by your nearest Costco

There’s not exactly a Costco warehouse around every corner. It’s widespread, with nearly 600 locations in the United States, but there are plenty of areas where the closest Costco is 30 minutes or more away.

When you’ve moved and don’t have a Costco nearby anymore, a membership may not be worth it. You’ll be spending more on gas and using up more time, when you could just go to a local supermarket instead. Think about whether you really want to make the drive to Costco on a regular basis, or if you can be just as happy shopping elsewhere.

3. Your household has downsized

Costco is paradise for families and roommates who shop together. You can get great deals while buying in bulk. It isn’t always as beneficial for people who don’t need to buy as much.

For example, if your kids have moved out and now it’s just you and your spouse, you might not want to load up on groceries anymore. Or, if you recently downsized from a one-bedroom apartment to a studio, you may not have room for giant packages of paper towels, huge jars of peanut butter, and boxes with 300 pieces of bacon.

4. You’re dreading your shopping trips

Shopping at Costco is definitely an experience. Warehouses are huge, and often crowded, so everything takes longer. There’s a lot of walking involved, no matter how many items you need. You also need to present your Costco card on the way in and your receipt on the way out. That all means shopping trips tend to take longer than they do at other stores.

Some people love shopping at Costco, but others feel the opposite. If you’re thinking to yourself “let’s get this over with” every time you go to Costco, you’re better off shopping somewhere else.

For those who save big at Costco or love shopping there, it’s worth the price of admission. If not, there are plenty of other places to shop, so you might as well keep the $60 or $120 you’d pay for an annual membership.

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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.Lyle Daly 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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