Money Management

Read this before you decide living with mom and dad is the way to go. 

Housing has become very expensive in the United States. In fact, the Federal Reserve Bank of St. Louis reported the average sales price of a home in the fourth quarter of 2022 was $535,800. This means if you wanted to save up the recommended 20% down payment for a property so you could get an affordable mortgage without having to pay added costs of private mortgage insurance, you would need $107,160.

Saving up that much money may seem next to impossible unless you can dramatically cut costs. And, for some people, one way to do that is to move in with their parents. If your family will allow you to live rent-free or for a low amount of rent, you can put the extra cash you were spending on housing into a savings account for your down payment.

Before you do that, though, there are a few key things to consider.

How long will the arrangement last?

One of the first things to think about is how long you’ll actually be living with your parents before you’ll have the down payment needed to move forward with buying a home of your own. Assessing the timeline will help you and your parents decide if this is a situation you’re all comfortable with.

You should make a budget based on what your housing costs would look like after moving in with mom and dad. Using this new budget, see how many months (or years) it will be before you have the down payment you need. With this information at your disposal, you can have an open conversation with your parents about how long you’d need the help.

Is everyone on the same page about key issues?

If you’re considering moving in with your parents, you need to make sure everyone is in agreement on what cohabitation will look like. This includes you, your parents, as well as other family members such as your spouse or kids.

Think through every aspect of daily life and discuss those issues so there are no unpleasant surprises. For example, who will put groceries on their credit cards or cook meals or handle cleanup? Will you stay in your area of the house or will everyone live together? Will grandparents help out with the kids when you’re cohabitating, and are they OK with the messiness your children might bring? How will pets be affected? Will you be expected to come home at a certain time?

The more people you’re moving into your parents’ home, and the longer it’s been since you lived with your parents, the more of these issues need to be ironed out.

You don’t want to ruin your relationship with your parents, your spouse, or anyone else in your family because you have different ideas about how living together will go. So be sure everyone is on board with your plans.

By addressing these issues, you can make sure that moving in is the right choice to help you fulfill your homeownership dreams without derailing your family life.

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Gambling winnings can result in a higher tax bill, but there’s more to the story. 

Did you win some money in 2022? Maybe you won a slot machine jackpot, got lucky while betting on a horse race, or won a poker tournament. While it’s definitely fun to win money, what happens next often isn’t nearly as enjoyable.

Specifically, when you win money from any type of gambling activity, the IRS wants its cut. Gambling winnings are taxable, and you may even receive a tax form in the mail (with a copy sent to the IRS) documenting the win. Here’s a rundown of what you need to know about gambling taxes and how you might be able to reduce your tax bill.

The IRS wants a piece of your jackpot

First, the bad news. All gambling winnings are subject to tax and are technically required to be reported. And not only that, but any costs associated with gambling (such as a fee paid to place a wager or the initial bet itself) aren’t deductible. In other words, if you win a $1,000 slot machine jackpot on a $5 spin, your taxable winnings are $1,000, not $995.

Having said that, in practice, the IRS doesn’t expect you to report every time you win $5 from a scratch-off ticket, but it’s important to note that you’re officially required to report your winnings. And if you win more than a certain amount, the casino or gaming establishment is required to issue you a Form W-2G.

Under current IRS law, the thresholds where you can expect to receive a W-2G are:

$600 or more on a horse race or 300 times the wager amount, whichever is greater$1,200 or more on a slot machine or bingo game$1,500 or more at keno$5,000 or more in a poker tournament

Casinos don’t have to issue W-2Gs for table game wins, with a few exceptions. For example, if you win a progressive jackpot or side bet while playing a table game, you may receive a W-2G. The same $600 minimum or 300 times the wager amount threshold that applies to horse racing technically applies to table games as well, but the latter figure (300 times the wager) generally limits table game tax reporting requirements to jackpots. But the point is that unless you have a single win that is 300 times your wager or more, you won’t get a W-2G in the mail just because you cashed out with a few thousand dollars from a blackjack or craps table.

You may be able to reduce your tax burden

First off, you have the option to have money withheld from any large win when the casino attendant gives you a tax form to fill out. The standard federal withholding rate on a W-2G is 24% for U.S. citizens and 30% for non-citizens. This is optional but can help prevent you from owing money unexpectedly at tax time.

Second, if you itemize deductions on your tax return, you can deduct your gambling losses against your winnings. You can only deduct losses to the extent that you have winnings, so if you have a $1,500 slot jackpot and $2,000 in losses on table games, you can only deduct $1,500 of the losses. But this can effectively wipe out your tax liability.

However, it’s important to note the IRS only allows this if you keep records of your losses, and you are likely to raise red flags at the IRS if you, say, try to claim a $20,000 loss to offset a $20,000 jackpot. If you legitimately had the losses and can prove it, you should absolutely do this — but make sure you can back it up. The good news is that if you use a player’s card while playing at a casino, they’ll usually do this for you, and you can download your win/loss statements easily.

The bottom line on gambling taxes

Gambling winnings are taxable as income, but you might be able to reduce your tax burden by claiming losses. After all, most people don’t sit down at a slot machine and win a large jackpot the first time they press the button — there are usually some losses incurred before that happens. One key takeaway is to always use players cards that track your play when you gamble, as these can help document any losses that can offset a win or find another way to document your wins and losses while playing.

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Not eating meat doesn’t necessarily mean not being able to dine at Chick-fil-A. 

Many people rely on fast food restaurants when they need a quick, easy meal to grab and go. But if you follow a vegetarian diet, you might struggle with a lack of options at fast food establishments. This especially applies to Chick-fil-A — the name itself implies a chicken-centric menu that may not offer much for non-meat eaters.

But now, Chick-fil-A is testing a new vegetarian entree in a few select markets. And if it’s well-received, it could start popping up in locations all over the country.

Introducing the new Chick-fil-A Cauliflower Sandwich

Chick-fil-A is rolling out a cauliflower sandwich in three test markets — Denver, Colorado, Charleston, South Carolina, and North Carolina’s Greensboro-Triad region. And its goal is to mimic the flavor of the original Chick-fil-A Chicken Sandwich.

The Chick-fil-A Cauliflower Sandwich is marinated and breaded with the chain’s signature seasoning. It’s then served on a toasted bun with two dill pickle chips.

Should vegetarians rejoice?

Whether the Chick-fil-A Cauliflower Sandwich is something you ought to try will have to depend on how strict a vegetarian you are. That’s because Chick-fil-A specifically says that it does not designate vegetarian-only preparation surfaces in its restaurants.

To put it another way, the Chick-fil-A Cauliflower Sandwich will be cooked on the same surface as meat products. So if that’s a problem for you, then this is one entree you may need to pass on. Also, if you follow a vegan diet, the Chick-fil-A Cauliflower Sandwich won’t be an option for you, as it’s prepared with milk and eggs.

Don’t be fooled by the affordability of fast food

Whether you’re stopping in to Chick-fil-A to try its new vegetarian offering or you’re visiting another fast food joint, it’s easy to fall into the trap of thinking you’re getting a bargain and saving money on food. It’s true that fast food, by nature, costs less than your typical sit-down restaurant. But if you’re trying to grow your savings account balance this year, you’ll need to limit the amount of fast food you purchase. That’s because you’re apt to spend more on fast food than you would on buying groceries.

This holds true even though the cost of groceries is up a whopping 11.3% on an annual basis, as per the latest Consumer Price Index reading. But there are different steps you can take to save money on groceries, such as buying in bulk from stores like Costco when it makes sense to do so, or frequenting discount grocers like Aldi and seeing what bargains you can snag. You may even find some kitchen staples at your local dollar store.

Meanwhile, if the Chick-fil-A Cauliflower Sandwich isn’t an option for you — either because you don’t live in one of the test markets or you’re not okay with the way it’s prepared — you could always try to make your own version at home. Doing so might result in a lower credit card tab. And you might manage to produce a healthier version that’s better for you as a whole.

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

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Talk about a nice development. 

There’s a reason air travel has become such an unpleasant thing for so many people. Not only have airlines become notoriously terrible at avoiding delays, but these days, anyone who travels by air should expect to be charged for just about everything other than a seat. (And if you want a reasonable amount of legroom to go along with your seat, guess what? There’s a charge for that.)

But one airline is introducing a new line of snacks that passengers can enjoy. And the best part? They’re actually available free of charge.

United is making an effort to up its customer service game

Although United is hardly known as a budget airline, it’s still done away with numerous perks through the years. But one thing United does not charge passengers for is snacks. This applies even to passengers who book a basic economy fare. (Granted, if you go this route, you probably won’t get to choose your seat, and you may be the last person on and off the plane — but at least you’ll get a free snack.)

Meanwhile, United is unveiling three new snack options designed to appeal to a range of dietary needs. The new options, as reported by The Points Guy, include:

Dark chocolate and sea salt chocolate crisps by Undercover Snacks starting March 1Apple and mango fruit bars by That’s it starting April 1Savory snack mix by Summer Harvest starting April 1

These snacks are suitable for passengers who follow a gluten-free diet. And the first two are largely allergen-free and are certified Kosher.

How to score even more perks for free when you travel by air

It’s a nice thing that United is willing to give free snacks to passengers. But let’s face it — if you do a lot of air travel, you’re probably looking for more ways to eke out some savings. And that’s where the right travel rewards credit card might come in handy.

Many travel rewards cards offer passengers the option to check a bag at no cost. And that can amount to a lot of savings. On United, for example, you’ll pay $35 each way to check a bag on a domestic flight. If you take numerous flights a year and are able to avoid that fee each time, the savings could really add up.

Plus, while United might offer free snacks, if you want a meal or an alcoholic beverage on board, you should expect to pay up. But your travel rewards credit card might come with a discount on in-flight purchases, making those items less expensive.

Now, one thing you should know about travel rewards cards is that many come with an annual fee, so you’ll need to crunch the numbers to see if paying one makes sense. But if the math works out in your favor, then it could pay to add a travel rewards credit card to your personal mix so that an apple and mango fruit bar isn’t the only free perk you snag when traveling this year.

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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 Apple. The Motley Fool has positions in and recommends Apple. The Motley Fool recommends the following options: long March 2023 $120 calls on Apple and short March 2023 $130 calls on Apple. The Motley Fool has a disclosure policy.

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The experiment went well, but it came at a cost. 

Like many people I know, I started off 2023 with a New Year’s challenge: Cut back on one non-essential expense and see what a difference it makes.

I specifically wanted to choose an expense to cut back on that would only impact me, and not the rest of my family. And so I landed on my morning coffee.

Normally, I pick up a Dunkin’ coffee every day on my way back from walking my daughters to school. I happen to have a Dunkin’ inside my local supermarket, so I’ll often buy some groceries as well.

I usually don’t buy Dunkin’ coffees on weekends, mainly because it requires me to leave my house when I otherwise don’t have to and I’m fine with taking a break. But usually, I buy myself a large hot coffee with milk — nothing fancy — that comes to $2.93 a pop.

Clearly, this is not the largest expense. But in the course of a month, the cost of store-bought coffee can add up.

In January, there were 22 workdays (I worked on Martin Luther King Day, so it counts). By not purchasing coffee, I saved myself $64.46. And you know what? I actually regret saving that money.

An experiment gone awry

A big reason I tried cutting back on spending in January was that I felt that once again, the holidays were more expensive than I’d bargained for. Now thankfully, I was able to pay off all of my credit cards in full following the holidays and didn’t leave myself with lingering debt. But I figured I should take the opportunity to add some money to my savings account in light of all that holiday spending I did.

And lo and behold, I did manage to boost my cash reserves by $64.46. Yay. Only if I’m being honest, it didn’t seem like much of a victory.

Because my husband and I keep a lot of our expenses, like our mortgage payments, low compared to our income, we’re typically able to save a nice amount of money each month. So adding $64 and change to my savings account didn’t feel like a huge accomplishment.

Not only that, but I really missed my daily Dunkin’ coffee. The coffee I made at home, though considerably cheaper (especially since I had a bunch of leftover pods I needed to use before they went bad), just wasn’t as good. And that was something that annoyed me every single workday during the month of January.

Lesson learned

If you’re someone who’s carrying credit card debt with no money in savings, then banking an extra $64.46 in a month is something you should absolutely aim to do — even if it means giving up your morning dose of store-bought caffeine. But I really don’t think $64.46 in savings is going to make a big difference in my finances. So in reality, even though I met my January challenge, I don’t really feel a sense of pride.

If anything, I think depriving myself of my beloved coffee was a little silly. So going forward, that’s not something I’m going to force myself to do unless my financial situation takes a turn for the worse.

Rather than give up a small daily purchase that makes me happy, I’d rather do an extra assignment each month that puts that $64.46 in my pocket. Sacrificing a few hours of my time is worth getting to enjoy a nice cup of coffee in the morning all month long.

Incidentally, once February rolled around, I resumed my daily Dunkin’ habit. And the Dunkin’ employee who normally serves me my morning coffee actually asked if something was wrong since I’d been away for so long. When I explained about my challenge, he laughed.

“Life’s too short to have bad coffee,” he insisted. I couldn’t agree more.

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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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