Money Management

It’s an option you may want to consider. 

If there are people in your life who rely on you financially, or who might get hurt financially in the event of your passing, then it’s a good idea to put a life insurance policy in place. That way, your loved ones will get financial protection — and you’ll get peace of mind.

It’s common for life insurance companies to require applicants to get a medical exam before offering up coverage. The reason? If you have health issues, you’re a greater risk to a life insurance company, so that’s something they want to verify before writing policies.

But maybe you don’t want to go through the process of getting a medical exam for life insurance purposes, either because you’re busy or because you feel it’s an invasion of privacy. Or maybe you know you have health issues and are worried that if you’re forced to undergo an exam, you’ll be denied life insurance coverage.

The good news is that some insurance companies offer what’s known as a no-exam life insurance policy. And you might benefit by going this route.

The upside of buying life insurance without a medical exam

The process of scheduling a medical exam, participating in one, and waiting on the results can be time-consuming. If you’re eager to put life insurance coverage in place immediately, then a no-exam life insurance policy may be better for you, as these can often be finalized pretty quickly.

Also, if you know you have health issues that make you a high-risk applicant, such as being a smoker, having heart disease, or being diabetic, then a no-exam life insurance policy could be a better bet for you. These factors might make it harder to qualify for a traditional life insurance policy. And even if you do qualify, these factors could easily lead to higher premium costs.

The downside of buying life insurance without a medical exam

While no-exam life insurance has its advantages, one drawback you should know about is that your coverage may be limited. If you want to secure a larger amount of coverage, you may need to undergo a medical exam and choose a different type of policy.

Also, with a no-exam life insurance policy, your insurer is taking a risk. So in exchange, you might face higher premiums.

U.S. News & World Report says you can expect to pay $83 a month for a $1 million, 20-year term life insurance policy if you’re a 40-year-old female non-smoker, or $103 a month as a 40-year-old male non-smoker. These numbers might fit nicely into your budget. But if you’re getting a no-exam life insurance policy, those numbers could be a lot higher.

Should you get a no-exam life insurance policy?

If you have pre-existing medical conditions that might make it harder to get life insurance, then a no-exam policy could be a good bet. But if you’re someone who’s fairly young and healthy, then you may be better off buying a policy that requires a medical exam. Doing so could result in a more generous life insurance benefit and cheaper premiums.

Our picks for best life insurance companies

Life insurance is essential if you have people depending on you. We’ve combed through the options and developed a best-in-class list for life insurance coverage. This guide will help you find the best life insurance companies and the right type of policy for your needs. Read our free review today.

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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Finding the best deal is simpler than most drivers realize. 

Car insurance is a must for drivers in all states, but it can be tough to stomach that premium sometimes. While young drivers and those with accident histories tend to pay the most, it’s normal for even the safest drivers to spend thousands of dollars on car insurance each year.

The average 2023 auto insurance premium is expected to be about 7% higher than last year’s, according to recent data from Insurify. But that doesn’t mean all drivers should expect a big increase. Here are three things that can help motorists get the coverage they need while keeping costs as low as possible.

1. Shop around

Each car insurance company has its own algorithm for assessing risk. They all look at similar factors, like a driver’s age, history of tickets and accidents, vehicle make and model, and location. But every company weighs this information differently, which is why the same driver gets a variety of quotes from different companies.

It’s a good idea for everyone to shop around once in a while to see if there’s a different insurer that can offer them a better rate. Most companies enable drivers to get quotes online these days, so it’s not too difficult to compare options side by side. It’s usually possible to save quotes as well so there’s no need to re-enter all the same information when it’s time to buy.

2. Claim all possible discounts

Insurers apply many policy discounts to a driver’s rate automatically if they qualify for them. Though more discounts doesn’t always translate to a lower rate, it doesn’t hurt to seek out companies with several relevant savings opportunities. Those with hybrid vehicles and military members, for example, should be able to find special savings with certain providers that could tip the scale in their favor.

Some companies also have optional discounts that drivers must sign up for. Driver monitoring programs are a good example. These usually involve an app or a small device installed in the vehicle that monitors driving habits for a certain period of time. Most companies give drivers an upfront discount if they participate in these programs. And if the driver demonstrates safe behavior behind the wheel, they could qualify for an even lower rate.

3. Opt for a higher deductible

Deductibles are the out-of-pocket costs a driver pays when they file a claim before the insurance company pays for the rest. Nearly all car insurers charge deductibles, though some have a vanishing or disappearing deductible program for drivers who go several policy periods without a claim.

Generally, choosing a higher deductible reduces monthly premiums. This can be a great way for drivers to save, but it’s important to keep enough money for the deductible in an emergency fund in case of an accident.

Why reducing coverage isn’t a good idea

Some drivers think that the best way to reduce their auto insurance payments is to purchase less coverage. While this will certainly lower monthly premiums, it could create costly long-term problems in the event of an accident.

If a driver only has state minimum coverage and they severely injure or kill someone in a crash, the damages are likely to exceed the policy’s limits. The insurer will pay out their portion, but the driver will likely have to pay for the remainder of the damages out of their own pocket. This could amount to tens or even hundreds of thousands of dollars.

And if a driver skips their state minimum car insurance, they’re breaking the law. This could lead to fines, driver’s license or vehicle registration suspension, or even jail time.

It’s much better to rely upon the tips above to reduce car insurance rates. If reducing coverage is absolutely necessary, drivers should drop their policy limits as little as necessary to ensure they still have adequate coverage for expensive accidents.

Our best car insurance companies for 2022

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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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Tenants deserve protection. Here’s what lawmakers are doing about that. 

There’s a reason people are often encouraged to purchase a home rather than rent one. When you own a home, you can’t be kicked out of it unless you stop paying your mortgage or property taxes. When you rent a home, you never know when your landlord might choose to not renew your lease, leaving you scrambling to find housing.

But not having a lease renewed is a fairly minor problem in the grand scheme of tenant issues that have the potential to arise. That’s why lawmakers recently released the White House Blueprint for a Renters Bill of Rights. Here are some key points it aims to address.

1. Access to safe, affordable housing

People who spend more than 30% of their income on housing risk financial difficulties. For homeowners, that 30% should encompass not just mortgage payments, but also, the cost of property taxes and homeowners insurance.

Tenants, meanwhile, should aim to keep their rent payments to 30% of their income or less. But as of 2019, almost 25% of tenants were spending at least half of their income on rent. And since then, rental affordability has worsened. As such, lawmakers are working to help those in need of housing gain access to units that are not only safe, but affordable.

2. Clear and fair leases

It’s common for landlords and property managers to use attorneys to help draft their lease documents. It’s less common for tenants to hire an attorney to help them review a lease before signing it.

As such, lawmakers are trying to take steps to ensure that leases are fair to tenants and don’t put them at a disadvantage. Leases should be clear, transparent, and written in languages those on the signing end understand.

3. Tenant education and enforcement of rights

Discrimination has long been a problem in the world of housing, and lawmakers want that to end. That’s why they’re focusing on tenant education and making sure those who rent homes, or seek out rentals, are well-aware of their rights and understand how to identify discriminatory practices among landlords and property management teams.

4. The right to organize

If a group of tenants is being treated unfairly, those tenants should have the freedom to organize without harassment or threats from their landlords. And they certainly should not have to risk losing their homes for speaking up against things like delays in major repairs. Lawmakers are working to enforce tenants’ right to organize.

5. Eviction prevention

Prior to the pandemic, tenants faced roughly 900,000 evictions every year. Lawmakers want to take steps to protect tenants from losing their homes due to eviction. To this end, they plan to reinforce rules requiring landlords to give at least 30 days’ notice prior to an eviction. The U.S. Housing Department is also awarding $20 million to the Eviction Protection Grant Program in 2023, which will fund nonprofits and government groups that provide legal assistance to tenants facing or at risk of eviction.

People who rent their homes rather than own deserve to have their rights upheld. And so it’s a good thing that lawmakers have outlined an in-depth proposal designed to achieve this very goal.

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Consider investing in T-bills for a guaranteed return. 

Last year, the S&P 500 dropped by close to 20% and the NASDAQ by 33%, showing their worst performance since 2008. With inflation still at a historic high, the market is volatile, which is making investors nervous. There are opportunities in the bond market, however, that are now providing very attractive yields not seen in over 15 years. The interest rate on U.S. six-month Treasury bills exceeded 5% recently, reaching the highest level since 2007. With bonds back in fashion with investors, here is how they work, how you can buy them, and why they are such a great low-risk investment option.

What are Treasury bills?

Treasury bills, also known as T-bills, are short-term debt obligations issued by the U.S. government. They typically mature in one year or less and have maturities ranging from four weeks to 52 weeks (one year). As of Feb. 17, 2023, here are the current interest rates for different daily T-bills:

4 weeks: 4.59%8 weeks: 4.75%13 weeks: 4.82%17 weeks: 4.92%26 weeks: 5.03%52 weeks: 5.02%

The current rate of return, which ranges from 4.59% to 5.03%, is higher than most savings accounts, money market accounts, and certificates of deposit (CDs). Currently, the average rate of a savings account in the U.S. is 0.33%, a money market account is 0.44%, and a 6-month CD is 0.81%.

Plus, T-bills are considered a risk-free investment because they are backed by the full faith and credit of the U.S. government. This means there is virtually no chance that your principal will be lost or that you will not receive your interest payments when they’re due.

How do you buy Treasury bills?

The easiest way to buy T-bills is through an online broker like TD Ameritrade or Fidelity. But you can also purchase them directly from the U.S. Department of Treasury via its website at treasurydirect.gov. When buying T-bills through an online broker, you will need to open an account first and then select the type of bill you want to buy — either a 4-, 13-, 26-, or 52-week bill — and decide how much you want to invest.

Then simply place your trade order with the broker and wait for it to settle (which usually takes two business days). Usually with direct purchases from treasurydirect.gov, you can buy any amount starting at $100 all the way up to $10 million per day without paying any fees or commissions. However, if you choose to use an online broker, there may be fees associated with buying T-bills and there is often a higher minimum purchase requirement. For example, you may be required to purchase a minimum of $1,000 in T-bills versus the $100 that treasurdirect.gov requires. Just be sure to do your research before purchasing through a stock broker.

Why should you invest in Treasury bills?

Currently, Treasury bills offer investors several benefits over other types of investments. They include safety (they are backed by the full faith and credit of the U.S.), liquidity (they can easily be sold before maturity), and attractive rates of return compared to other investments like CDs or money market accounts. Additionally, because they mature quickly — in one year or less — you don’t have to worry about long-term commitments or locking yourself into something for too long if your needs change or the market changes.

If you’re looking for a safe investment with an attractive return that doesn’t require a long-term commitment, then consider investing in Treasury bills. Not only do these investments offer a guaranteed return, but they are currently offering their highest rates in over 15 years, making now a particularly attractive time to invest.

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

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Turns out, no one has all the answers. 

Even if you don’t aspire to be “rich,” you probably like the idea of financial security. And while we can’t take all of our cues from the wealthy, we can peek into their financial habits to learn if any might work for us.

The Ascent surveyed 1,500 credit card holders. Each of those surveyed has a self-reported net worth of more than $1 million. Here’s what we learned about how wealthy people use their credit cards. Some of these habits are worth mimicking, while you might want to ignore others.

1. They’re a mixed bag when it comes to credit card applications

Most respondents said that they have two to four different credit cards. That’s similar to the national average of 2.7. So far, so good.

Wealthy cardholders are more likely than the rest of us to open three or more new credit cards each year. Perhaps they’re not worried about their credit scores, but they should be. Even if they don’t plan on taking out a new loan anytime soon, an emergency can arise at any time. The need for a personal loan or even a mortgage can come faster than you think.

Important detail: Those with a self-reported net worth of more than $10 million are slightly more likely to open three or more cards every year. It’s possible they’re less concerned about maintaining a high enough credit score to land a low-interest loan than the rest of us might be.

New credit

FICO® Scores are still the big name in credit scores in the U.S. and the scoring system most often used by lenders to determine loan eligibility. “New credit” accounts for 10% of our score. In short, lenders want to know that we’re not in the habit of opening new accounts willy-nilly, and opening several new cards a year is likely to raise a red flag.

Length of credit history

Another factor in our credit scores is “length of credit history.” This tells lenders how long we’ve managed our loans and credit cards. The longer, the better for our scores. Opening new cards regularly means they always have several practically brand-new cards. It’s another issue that may rear its head just enough to worry potential lenders.

2. Only one-third pay their statement balance off each month

This result came as a huge surprise. Failing to pay credit card balances off monthly is like setting a stack of cash on fire. Why pay interest on credit card debt when it’s not necessary?

This is one of those habits we all might want to avoid.

3. They’re partial to cash back cards

This response was truly a matter of preference. Some of us love to watch airline points add up, while others prefer cash back on their purchases.

4. It’s 1975 all over again

Oddly, 21% of high-net-worth respondents said they prefer to pay their credit cards with an old-fashioned paper check. However, we can’t say for sure why. It may have something to do with accounting practices.

5. Over 50% of respondents admit to maxing out a credit card

This result alone is enough to remind us that it doesn’t matter how much we earn. What matters is how we manage that money.

6. They prefer cards with no annual fees

The fact that anyone should prefer a credit card with no annual fees makes sense. However, if a card offers far more back in annual perks than the cost of its annual fee, it may be worth exploring.

As mentioned, there are a few personal finance habits that are worth copying and others we’d all do well to avoid. It just goes to show that we all have strengths and weaknesses, no matter how much we earn.

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It’s a big part of your credit score, but with this strategy, you’ll never need to check it. 

When your credit score is calculated, one key number is your credit utilization. Your credit utilization is the balances on your credit cards divided by your credit limits. This is part of a factor called amounts owed, which makes up a whopping 30% of your FICO® Score (the most widely used type of credit score by lenders).

Even though credit utilization is very important, I literally never check mine. I’m able to skip this step for one simple reason, and anybody could follow the same approach.

How to put credit utilization on autopilot

I never worry about my credit utilization because I have a large amount of credit. My combined credit limit across all my cards is around $200,000, far more than I’d use in a month or a year.

For credit utilization, lower is better, but the standard rule is to keep yours below 30% to avoid damaging your credit. If you have $1,000 in credit, that means you’d need to stay below a balance of $300 to follow that rule. But if you have $100,000 in credit, then you’d only need to stay below $30,000.

Once you have enough credit, you probably won’t need to check your credit utilization. In my case, I know that I’m not going to spend anywhere near 30% of my total credit.

There’s also an important habit I follow — I pay my credit cards in full every month. Even with high credit limits on your cards, if you don’t pay them off, the balances could eventually grow large enough to impact your credit utilization. More importantly, if you carry a balance, you get charged credit card interest. Whenever possible, it’s better to pay in full to avoid interest charges.

How to increase your credit limits

The challenge of this method is getting access to more credit. Your income plays a role here, as your income on credit card applications is a factor card issuers use to set your credit limit. However, even people with income below the national average can get plenty of credit.

There are two simple tips you can follow to increase your total credit limit:

Apply for more credit cards. Every time you’re approved for a card, its credit line adds to your total credit limit.Request a credit limit increase. If you regularly pay your credit card bill on time, you could qualify for a higher credit limit. Most card issuers let you request this online or by phone.

There are a couple of things to know before you do this. Increasing your credit can backfire, big time, if it causes you to start overspending. Only follow these tips if you’re confident that more credit won’t change your spending habits, and that you’ll pay your credit cards in full every month.

Also, it’s much easier to get more credit if you have a high credit score. Card issuers will be more likely to approve you for new credit cards and credit limit increases. If you’re working on raising your credit score, focus on that first by paying your credit card bill on time and not spending too much.

When you’re in the process of building credit, monitoring your credit utilization is a good idea. Once you have a good credit score, you may want to consider increasing your overall credit limits. If you do that and always pay your credit cards in full, you won’t need to monitor your credit utilization anymore.

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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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