Money Management

Here’s how to narrow down the dozens of personal loan companies. 

If you’re in the market for a personal loan in 2023, there is certainly no shortage of choices. In addition to the numerous online-based lending platforms, most banks and credit unions offer their own personal loan products.

But how can you narrow down the list of options and decide which is the best personal loan for you? Here are a few tips to help you decide.

Look for lenders with features you want

First and foremost, it’s important to realize that not every lender is a good match for every borrower. Some lenders are only interested in making personal loans to borrowers with top-tier credit scores, while others focus on extending loans to customers with less-than-perfect credit.

It’s also important to make sure a lender is offering the product you need. Personal lenders generally publish their minimum and maximum loan amounts, so be sure to look at those. For example, if you need to borrow $50,000 for a home improvement project and a particular lender offers loans from $5,000 to $40,000, you can go ahead and cross it off your list.

Other things you might want to consider:

Funding speed: Some lenders fund loans as soon as the same business day, while others can take a few days.Banking relationships: If your bank makes personal loans, that’s a good place to start your search. Not only is it convenient to be able to manage your bank accounts and loan in the same app, but many offer interest rate discounts for existing customers.

There are other potentially valuable features you may want to look for. As an example, some lenders can send your loan proceeds directly to your credit card companies if you’re taking out the loan to consolidate debt.

In addition to starting with your own bank, take a look at our updated list of top personal lenders and read some of our reviews to get a sense of which lenders offer which features.

Look at the true cost of borrowing

Some lenders don’t charge any origination, prepayment, or other fees, while others do. And some only charge fees to certain borrowers.

There are personal lenders that charge origination fees of as much as 5% of the loan amount, so this should certainly be taken into consideration. And if your hope is to pay back your loan faster than the agreed-upon term, be sure you won’t get charged for it.

Shop around for offers

One of the best features of the personal lending industry as a whole is that virtually all of the top companies allow borrowers to check their rates and loan term offers with no impact on their credit score. You can get your actual loan offers from as many companies as you want, and there’s no downside to doing so (other than spending the time).

To be as clear as possible, it is extremely important to get quotes from several different personal lenders. I just checked my loan offers from two lenders and the cheaper one would save me more than $500 in interest over the term of a 60-month loan. You might be surprised how loan terms can differ from one lender to another, so once you’ve narrowed down your list a bit using the other guidelines discussed here, take some time and get personalized loan quotes from as many as you can.

A few hours can save you a lot of money

The bottom line is that there have never been more options available when it comes to personal loans, so it can be quite a process to shop around and compare all of your options. But it can be well worth your time — it’s not uncommon for the total cost of a personal loan to differ by several hundred (or even thousands) of dollars between lenders, so it can certainly justify spending a couple of hours on research.

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The millionaire next door is a lot more common than you might think. 

For decades, the term “millionaire” has been one of the most common ways to describe a wealthy individual. It doesn’t mean nearly as much as it once did, thanks to inflation. But it’s still widely used and is normally a sign that a person is doing pretty well with personal finance. And then there are billionaires, who unarguably have more money than any human being could ever need.

Just how many people have reached these major financial milestones? We have the answer, thanks to the latest USA Wealth Report from Henley & Partners.

How many millionaires and billionaires live in the United States?

There’s a staggering amount of wealth and high-net-worth individuals in the United States. It’s home to $65.4 trillion in private wealth, by far the largest wealth market in the world. For comparison’s sake, second-place China has $21.7 trillion. Here’s how many people the United States has in each major wealth classification:

5.3 million millionaires with a net worth of at least $1 million9,630 centi-millionaires with a net worth of at least $100 million770 billionaires with a net worth of at least $1 billion

The numbers reflect how rare each respective level of wealth is. Being a millionaire is still a major achievement, but it’s not too uncommon. The U.S. Census Bureau reports that there are 258.3 million adults in the United States. Based on that, millionaires make up about 2% of the adult population.

Centi-millionaires and billionaires, on the other hand, only make up small fractions of a percent. So, the average person will run into about two millionaires for every 100 U.S. adults they meet, but they could go their entire life without meeting a centi-millionaire or billionaire.

As far as averages go, the average wealth of a person living in the United States is $198,000. Keep in mind that outliers with ultra-high net worths surely bring that average up quite a bit. Despite the amount of wealth in the United States, it doesn’t have the wealthiest average citizen. It ranks fifth there, behind Monaco, Switzerland, Luxembourg, and Australia.

How to build wealth and become a millionaire

Now that you know the numbers on how many high-net-worth U.S. adults there are, let’s look at how you can join their ranks.

Specifically, we’ll go over how to become a millionaire, because that’s an achievable goal. If you manage money well, you can build a $1 million net worth. It’s becoming a centi-millionaire that’s likely going to be unrealistic, and billionaire status is definitely out of reach for most people not named Bezos or Rihanna.

The path to becoming a millionaire is fairly straightforward. Here’s what you need to do to get there:

Find a stable source of income. It certainly helps to have a high income, as well, but this isn’t required.Have manageable fixed costs (essential expenses). Ideally, these shouldn’t take up more than 50% to 60% of your income.Be careful about how much you spend. You can spend money on yourself, but watch out for big, unnecessary expenses.Invest your money. Aim to invest at least 10% of your income per month, and 20% is even better. Start by investing in retirement accounts, such as 401(k)s or individual retirement accounts (IRAs), because these have tax benefits. Many employers also offer a 401(k) match up to a certain amount.

As far as what you should invest in, having stocks in your portfolio is what’s most important. The stock market has an average return of about 10% per year, so it’s a reliable and effective way to build wealth. An easy way to invest in stocks is with an index fund that tracks either the total stock market or the S&P 500.

When you’re young, most of your investment portfolio should be in stocks. You could put 90% of your portfolio in stocks and 10% in bonds, which provide fixed returns. Once you get closer to retirement, you can shift more money to bonds to preserve your wealth.

It might seem simple, but the reality is that building wealth isn’t complicated. The hard part is staying disciplined by investing every month and not overspending. If you do that, you’ll make it to a net worth of $1 million and beyond.

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These cars can help you save money for the long term. 

One of the best ways to save money on your vehicle costs is to hang on to the same car for as long as possible. You may have heard that a self-made millionaire is more likely to drive a 10-year-old car than the newest model, and for good reason — a vehicle is a depreciating asset, and by minimizing the amount of money you’re sinking into it, the more you have to allocate in ways that can actually make you money.

With that in mind, automotive research firm iSeeCars analyzed more than 2 million cars to determine which are likely to last for the greatest number of miles, and here are the top 10:

There are a few important takeaways from this list. For one thing, notice that six of the top 10 are Toyotas, so it’s probably fair to call Toyota the most reliable overall brand.

Second, notice that eight of the top 10 are pickup trucks and SUVs. This certainly makes sense. After all, these types of vehicles are — by definition — built to handle heavy work loads and long trips. They tend to be built with a greater focus on durability than sedans.

Finally, notice that there are no electric vehicles on the list. That isn’t to say that an electric vehicle won’t last you 250,000 miles. Simply put, most electric vehicles haven’t been around long enough to gauge their long-term durability.

Cars that have low ownership costs

Of course, if your goal in looking for a long-lasting vehicle is to save money, the mileage you can expect out of your car or truck is only one part of the equation. Sure, a car that will last 250,000 or more miles will prevent you from having to buy a new car for a while, but that doesn’t mean much if you’re spending a fortune on maintenance and repairs. And some of the vehicles on the list — such as the Suburban and Yukon XL — aren’t exactly high-gas-mileage modes of transportation.

With that in mind, vehicle website autobytel.com analyzed the expected cost of three years of ownership for new vehicles, and here were the 10 with the lowest expected costs, including auto insurance, fuel, maintenance, as well as depreciation:

Not a lot of overlap

As you can see, there isn’t much overlap here, although it’s worth pointing out that there are some on this list that come close to being in the top 10 for reliability. For example, the Honda Civic is on the low ownership cost list and has an expected lifespan of more than 205,000 miles, giving it the number seven spot on iSeeCars’ most reliable sedans list. And the Honda Fit is expected to last over 207,000 miles based on the same research.

Which is right for you?

The bottom line is that there are some vehicles that are extremely reliable, some that are relatively cheap to own, and a select few that fit into both categories. The best way to use this information is to help guide you towards a vehicle that is likely to save you money and that meets the transportation needs of you and your family.

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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.Matthew Frankel, CFP® 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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We shouldn’t expect lawmakers to come through with aid anytime soon. 

For well over a year now, U.S. consumers have been battling inflation. And higher living costs have forced many people to do things like take withdrawals from their savings and rack up debt on credit cards to keep up with their bills.

Meanwhile, February’s Consumer Price Index was just released, and it showed that inflation rose 0.4% on a month-over-month basis. And that’s not great.

Now the good news is that the annual rate of inflation dropped to 6%, which is still high, but lower than January’s 6.4% annual inflation reading. But all told, living costs are still exorbitant, and consumers are still struggling to cover their basic expenses. And unfortunately, we can’t expect stimulus aid to come to the rescue in this situation.

Economic conditions don’t warrant a stimulus round

Lawmakers have turned to stimulus checks in the past during periods of economic sluggishness and high levels of unemployment. But that’s not where we are today.

The national jobless rate in February was 3.6%, which is very low, historically speaking. (For context, it’s comparable to where we were prior to the pandemic.) And last month, the U.S. economy added more than 300,000 new jobs.

In a situation like this, it’s extremely difficult to make the case for a stimulus round because there are no indications that the economy needs a boost. And that’s why the federal government is unlikely to send out stimulus checks anytime soon.

Now what we might see is some stimulus aid later on in the year on the part of individual states. Many states took that step last year to help residents cope with inflation. But for many Americans, stimulus aid just won’t be on the table.

A round of stimulus checks might only make inflation worse

At this point, many Americans are no doubt frustrated over the fact that lawmakers aren’t stepping in to help them get through this prolonged period of inflation. But it’s important to realize that stimulus checks aren’t actually going to solve the problem at hand. If anything, they’re likely to make the issue worse.

A big reason inflation started to soar is that Americans’ bank accounts were more robust in 2021 after having received stimulus aid and funds from boosted tax credits, like the Child Tax Credit. That gave consumers a lot more spending power. But an uptick in spending created a situation where demand exceeded supply, and that’s the perfect formula for inflation.

In fact, the whole reason the Federal Reserve has been raising interest rates aggressively is that it wants to discourage consumers from spending. And driving up the cost of borrowing is likely to lead to that scenario. If consumers grow weary of rising credit card and loan rates, they’re apt to cut their spending to avoid getting overcharged.

It’s most likely going to take a notable decline in consumer spending to bring inflation levels down. And since a round of stimulus checks would have the opposite effect, we’re unlikely to see one anytime in the near future.

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Don’t overpay on travel costs this spring break. 

Spring break is around the corner. For those with extra days off from school or work, it’s a great time to travel. If you’re hoping to get away but are on a budget, you may be looking for the best way to save money. You can trim your travel costs by booking a hotel deal. One hotel chain has a spring break deal that could save you up to 20% at select properties.

Omni Hotels & Resorts can help you save money

Many hotel chains run promotions and discounts to incentivize more travelers to make a reservation, and Omni Hotels & Resorts is no exception. The popular hotel chain is currently promoting its spring break sale. When you book a stay at a participating property by June 3, you can save up to 20% off the best available rate.

If you still need to reserve a hotel for spring break, now is the time to book. This sale is valid for stays through June 3. More than 50 properties within the United States and Canada are eligible for this promotion. You can learn more by visiting the Omni Hotels and Resorts website.

Don’t forget about hotel promotions and packages

Don’t miss out on hotel promotions and packages that could help you keep more money in your checking account. Many hotel chains promote special deals on their websites. The next time you need to book a hotel, check to see if your favorite hotel chain has promotions or packages that could make your upcoming stay more affordable. By booking a deal directly through the hotel, you may be able to stretch your vacation budget further.

How to save money when booking a hotel

You may be wondering how to find cheap hotel prices and where to find hotel deals like the one mentioned above. The following tips may help you save money on your next hotel stay:

Sign up for hotel email lists: Many hotels promote special deals to their newsletter subscribers. Joining your favorite hotel chain’s email list, so you don’t miss out on the chance to save money on an upcoming stay.Join hotel loyalty programs: Most hotels have loyalty programs that travelers can join for free. You may get a slightly cheaper rate as a loyalty member when you book directly with the hotel. Plus, these loyalty programs may offer extra perks to members.Use your AAA membership: Did you know AAA members can score hotel discounts? This is one of many little-known AAA perks. If your preferred hotel offers AAA membership discounts, you could save a significant amount of money.Use price comparison tools: Price comparison tools make it easy to compare hotel prices before you book. Examples of such tools include Hotwire, KAYAK, Priceline, and Expedia.Make a refundable booking: When reserving a hotel, it can be worthwhile to make a refundable booking. Doing this gives you more flexibility to rebook if needed. After making a refundable reservation, monitor prices and rebook if the price lowers.

Use travel credit cards to earn rewards

Before booking a hotel, check to see if you can save money or score a cheaper rate. Travel costs can add up quickly, so any money saved can be a win for your personal finances. It’s also a good idea to consider paying with a travel credit card to earn rewards so you can save on future travel. Check out our list of the best travel rewards credit cards to find one that fits your travel style.

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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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