Money Management

Here’s how to make the right call. 

If you went a bit overboard on spending during the holiday season, you’re not alone. But you may now be sitting on a pile of different debts that are stressing you out. And you may be struggling as you figure out how to pay them off.

Generally speaking, it’s best to focus on your highest-interest debt first. But if you owe money on a “buy now, pay later” plan, or BNPL plan, then you may want to give that debt priority in the coming weeks. Here’s why.

You don’t want to mess up your credit score

Many consumers have started using BNPL plans to pay for purchases. And if you signed up for some during the holidays to swing your gifts and other expenses, you may now be on the hook for a series of short-term installment payments you need to cover.

In this specific situation, it could pay to put your BNPL plan payments ahead of your credit card payments. The reason? If you make your minimum payments on your credit card, you won’t be dinged as late or delinquent from a credit reporting standpoint. Or, to put it another way, if you keep up with your minimum credit card payments, your credit score won’t take a hit.

On the other hand, if you fall behind on your BNPL plan payments, your credit score could sustain serious damage. And once that happens, it could become difficult to get approved for a personal loan in a pinch, or to borrow affordably for any purpose. Plus, you’ll risk being assessed costly penalties and fees — penalties and fees that are avoidable provided you stick to the terms of your agreements.

Remember, BNPL plans, by nature, only give you a limited amount of time to pay off your purchases. Usually, these plans are set up so you’re making payments for about 12 weeks or less. So even if you’re forced to carry some credit card balances forward for another three months, all the while racking up interest, those interest charges may not end up being so high since you’re only talking about 12 weeks. And then, once you’re done paying off your BNPL plans, you can focus on eliminating your credit card debt.

Be careful with BNPL plans

BNPL plans often seem like an appealing financing option — until consumers realize how difficult it can be to keep up with them. The next time you’re tempted to sign up for a BNPL plan, make sure you can really afford to pay off the item in question within such a short period of time. In general, it’s best to reserve BNPL plans for emergency purchases you can’t pay for outright.

Also, if you think you won’t manage to keep up with a BNPL plan, you may be better off using a credit card — even if that means paying more in interest. While incurring the cost of interest certainly isn’t ideal, credit cards tend to give consumers more flexibility with payments. And that could spare you a world of credit score damage if money is tight.

Top credit card wipes out interest until 2024

If you have credit card debt, transferring it to this top balance transfer card secures you a 0% intro APR for up to 21 months! Plus, you’ll pay no annual fee. Those are just a few reasons why our experts rate this card as a top pick to help get control of your debt. Read our full review for free and apply in just 2 minutes.

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.

 Read More 

Did you know CVS is the largest provider of retail healthcare in the country? 

If you’re looking to fill a prescription, you have two main options: Walgreens or CVS. Both are reliable pharmacies with stores located throughout the country. Combined, they control over 40% of the market. But what is the difference between these two? Which one should you choose when it comes time to get your prescriptions filled? Here is a comparison so you can find out which one is best for you.

Walgreens vs. CVS: Convenience

Both Walgreens and CVS are the largest retail pharmacies in the U.S. CVS is the largest, with close to 25% of market share based on prescription drug revenue. Walgreens is second with 18% of the market. In terms of locations, CVS is also the largest (with over 9,700 stores), followed closely by Walgreens’ 9,000 locations. With a similar number of locations (with many right next to each other!), both are conveniently located across the U.S. You can’t go wrong with either one.

One key difference is that Walgreens has curbside pickup, where you can place an order online and get your order (both prescription medications and other items) delivered to your car in as little as 30 minutes. CVS doesn’t offer curbside pickup, and while you can place your order online or through the app, you will have to head inside to the store’s checkout area to pick up your items. If picking up curbside is important to you, then Walgreens wins out.

Walgreens vs. CVS: Services

Walgreens and CVS have similar business models, as they are both full-service pharmacies offering a variety of services beyond just filling prescriptions. Both stores offer immunizations, over-the-counter medications, health screenings, and more. In addition, both stores also offer home delivery services for those who need their medications delivered, as well as mobile apps for easy refills and access to information about medications and healthcare products.

CVS has a leg-up in the health clinic race. CVS’s MinuteClinic is a medical clinic inside 1,100 CVS stores and is the largest provider of retail healthcare in the U.S. You can see a nurse practitioner and physician’s assistants for medical care with no appointment every day, including evenings and weekends. Currently, Walgreens has 400 medical clinics across 20 states, about a third of what CVS has. Walgreens recently announced that they are investing billions in VillageMD to open 600 Village Medical Clinics by 2025 and 1,000 by 2027. Until then, if you want in-person medical care, then CVS may be your best bet.

Walgreens vs. CVS: Prices, deals, and rewards

When it comes to cost, both Walgreens and CVS offer customers competitive prices on their medications. Prices will depend on the product and which deals are on offer. So it may make sense to do some research to see where items are cheaper. CVS and Walgreens both offer regular deals and each have their own rewards program. If you want to maximize your reward earnings, you may want to stick with one to accumulate the most points.

CVS also has an in-store coupon machine where you can check to see which coupons it is offering and print them out. CVS tracks your past purchases, so the coupons tend to be more personalized. Walgreens does not and instead of an in-store coupon machine, you will need to use the mobile app.

There is one other difference to consider. CVS gives you ExtraBucks coupons after you make a purchase. You can use those coupons right after receiving them. When you make another purchase with ExtraBucks, you will get another coupon, letting you keep “rolling” on purchase savings. If you like one particular product on sale and break up your purchases, you can save even more money. Unlike CVS, Walgreens’ Register Rewards do not roll on the same deal. It will instead offer a coupon on another product.

Walgreens vs. CVS: Customer service

According to Consumer Affairs, CVS’s customer ratings average 3.6 out of 5 and Walgreens’ customer ratings average 3.9 out of 5. However, according to Comparably, CVS’s Net Promoter Score is 13 points higher than Walgreens. Ultimately, customer service is based on your personal experience with the local store you visit.

Both Walgreens and CVS are excellent choices when it comes to filling a prescription. Prices are very competitive, so it really comes down to convenience factors such as location availability or extra services and rewards offered by either store. Based on your shopping habits, there are small nuances that can make one better than the other. So it’s always a good idea to compare prices and see which store will save you more before making your decision for where to fill prescriptions and make pharmacy purchases.

Alert: highest cash back card we’ve seen now has 0% intro APR until 2024

If you’re using the wrong credit or debit card, it could be costing you serious money. Our expert loves this top pick, which features a 0% intro APR until 2024, an insane cash back rate of up to 5%, and all somehow for no annual fee.

In fact, this card is so good that our expert even uses it personally. Click here to read our full review for free and apply in just 2 minutes.

Read our free review

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.

 Read More 

There are benefits to this specific borrowing option. 

Any time you borrow money, you run the risk of falling behind on a loan and seeing your credit score take a big hit. And that’s why it’s important to borrow carefully. But if you need money for a pressing matter, like a home repair, a vehicle repair, or a renovation that will have a significant impact on your comfort and quality of life, then you may want to consider taking out a personal loan.

The benefit of getting a personal loan is that you can use the proceeds for any purpose. That gives you a lot of flexibility. Plus, personal loans tend to charge competitive interest rates, especially compared to credit cards.

Meanwhile, taking out a personal loan may do more than just give you access to the funds you need. It might also help give your credit score a lift. Here are a few ways a personal loan can lead to a higher credit score.

1. Timely payments can work to your benefit

Of the various factors that go into calculating a credit score, your payment history carries the most weight. It speaks to how timely you are in paying bills. If you make your personal loan payment every month on time like you’re supposed to, that positive activity will get incorporated into your payment history.

2. A longer-standing loan could reflect well on you

Another factor that goes into calculating your credit score is the length of your credit history. Having longer-term loans and credit accounts open is a positive thing when it comes to credit scores. So if you mostly have credit cards that have been open for a year or less, and you take out a personal loan with a five-year repayment plan, that longer-term loan could reflect positively on your credit (provided your loan remains in good standing).

3. Non-credit card debt could lead to a healthier credit mix

Your credit mix is yet another factor that’s considered when calculating your credit score. It speaks to the various types of loan or credit accounts you have open. Lenders generally like to see debts other than just credit cards. So if your current credit mix is a handful of credit cards only, and you add a personal loan into that equation, it could result in a higher credit score.

Is a personal loan right for you?

Borrowing money via a personal loan makes sense when you have a financial need you’re trying to address. You generally shouldn’t, for example, take out a personal loan for the purpose of being able to go on vacation or upgrade your wardrobe. But if you’re running out of space at home and you need a personal loan to finish your basement, that’s a different story. And if you need a loan to fix up your car so it’s safer to drive, that, too, is a scenario where it makes sense to borrow.

The key, however, is to run the numbers and make sure you can easily keep up with your monthly personal loan payments. Falling behind could drag down your credit score — and that’s really not what you want.

Our picks for the best personal loans

Our team of independent experts pored over the fine print to find the select personal loans that offer competitive rates and low fees. Get started by reviewing our picks for the best personal loans.

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.

 Read More 

Carefully considered decisions pay off in the long run.  

Warren Buffett tends to tailor his advice to fit the precise moment in history. For example, it may be a good idea to purchase a fairly priced home when interest rates are low. On the other hand, buying property when home prices remain high and interest rates are rising is a riskier proposition.

View it as an investment

Buffett suggests that potential home buyers approach the process as they would approach buying a specific stock. You wouldn’t buy a stock if you weren’t confident that it would increase in value. Why buy a home above market price, knowing it will take you decades to recoup your investment?

Buffett asks a question of would-be home buyers with stars in their eyes and a fear of missing out. How much have they budgeted to reshingle the roof or dig up the septic field? When it comes to being a homeowner, what can go wrong will go wrong.

Buying a home is more than finding a way to swing the down payment, closing costs, and monthly mortgage payments. There will always be maintenance and repair costs to cover.

If you view a home purchase as an investment, it means factoring in the total cost, including upkeep.

Be realistic

According to Redfin, home values increased by an average of 45% between 2019 and mid-2022. If you’re new to the housing market, you may not realize how abnormal that is. If you base a home purchase on the belief it will appreciate at an annual rate of 5%, 10%, or more, you’re likely to make a very bad buying decision.

Depending upon where you live and the condition of your home, annual appreciation may — or may not — keep up with inflation. Never buy a home believing it will appreciate by a specific amount each year.

Think long term

Buffett isn’t looking to make fast money. He’s all about finding long-term investments that he understands and believes will succeed. The Buffett approach makes sense when it comes to real estate, too.

When you buy a property you can afford and hold it for the long term, you’re better able to weather the years when appreciation doesn’t keep pace with inflation.

Be patient

Although he has no interest in buying thousands of homes and becoming a landlord, Buffett has often said that buying a house was one of the smartest financial moves he ever made.

The trick is to be strategic about it. Don’t fall into the trap of believing you’ll never be able to buy a home just because the market is too hot to handle right now. Waiting for the right house at the right price will pay off.

You’ll need to be patient as you check real estate listings and keep an eye on interest rates. And then, when you do buy a home, you’ll have to be patient as you pay the mortgage off and the home gains value.

There are always going to be stories about people who made millions day trading in the stock market. And there will always be tales of home buyers who got lucky by buying at a bargain basement price and then selling when the market was hot.

Those are not the norms. Typically, it’s the steady, patient investor who walks away with money in their bank account.

Our picks for the best credit cards

Our experts vetted the most popular offers to land on the select picks that are worthy of a spot in your wallet. These best-in-class cards pack in rich perks, such as big sign-up bonuses, long 0% intro APR offers, and robust rewards. Get started today with our recommended credit cards.

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.

 Read More 

Make sure that money goes to work for you. 

Saving more money is a popular New Year’s resolution, but it’s not as simple as just working a little more or finding expenses to cut from your budget. Once you’ve brought the extra money in, you have to decide where to put it so it can do you the most good.

While the best place to keep your savings will likely vary from person to person, here are three suggestions for where to keep your spare cash this year.

1. Emergency fund

An emergency fund should be everyone’s top financial priority if they don’t have one already. And even if you do, it’s a good idea to look it over and make sure it’s still adequate after all the inflation we’ve experienced over the last year.

At a minimum, your emergency fund should contain at least three months of living expenses. Six months is even better and some people prefer to save up to a year’s worth of expenses. This might be worth it if you believe it would take you a long time to find work again if you lost your job.

It’s up to you to decide which expenses to include when calculating your emergency fund. You could focus on just the essentials like housing, utilities, and groceries. Or you could include extras too, like streaming services. But note that if you don’t include all your monthly expenses, you might be forced to tighten your belt if an injury or job loss leaves you unable to work. You can use an emergency fund calculator to figure out your target to save.

2. High-yield savings account

A high-yield savings account is a great home for your emergency fund and also for any short- to medium-term financial goals you’re saving for. Money for a down payment on a house or car, for example, or savings for a wedding or vacation are best kept in a high-yield savings account.

These accounts have no risk of loss as long as you keep your financial information private and don’t exceed the FDIC insurance limits. This makes them a more desirable home for short-term savings than investment accounts where there’s a chance that you could lose money.

High-yield savings accounts also offer interest. The rates aren’t as high as what you might earn through investing, but they’re considerably better than what you’d find with brick-and-mortar bank accounts. Many traditional savings accounts only offer about 0.01% annual percentage yield (APY), which might pay you a few cents per year at best. But the top high-yield savings accounts are currently offering over 3.50% APY. That could net you tens or even hundreds of dollars per year in interest, depending on how much money you keep in the account.

3. A retirement account

A retirement account is an excellent home for your savings if you don’t plan to spend the money anytime soon. You can invest the money to help it grow more quickly, and this will reduce how much you personally need to set aside for retirement.

There is a chance that you could lose money, but over the long term, the stock market has historically had strong returns. Short-term losses generally aren’t a huge concern when investing for retirement because most workers still have decades left to recover from them before they begin tapping their savings.

Retirement accounts also offer tax advantages you won’t find with a taxable brokerage account or savings account. Tax-deferred retirement accounts, like 401(k)s and traditional IRAs, give you a tax break on your contributions in the year you make them, while Roth accounts allow for tax-free withdrawals in retirement.

But before you put any money here, you should understand the rules that apply to any retirement account you choose, including annual contribution limits, eligibility requirements, and income restrictions. This will help you avoid costly penalties at tax time.

You can also split your money between several of the options discussed above. Think about what works best for you and then check in with yourself every month or so to see how your savings strategy is working out. Switch it up if need be until you find something you can stick with over the long term.

These savings accounts are FDIC insured and could earn you more than 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 more than 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.

 Read More