Money Management

There are different options you can consider. 

Many people dream of owning vacation homes. But the reality is that owning a vacation property can be a very expensive prospect. Not only do you need to come up with a down payment on that home, but you also need to cover the cost of insurance, property taxes, and maintenance on your own. That’s why a timeshare could be a better solution.

With a timeshare, you get access to a property for a preset amount of time each year. You might, for example, buy into a timeshare that gives you a week-long stay every calendar year in a popular beach or ski area.

There are ongoing costs to owning a timeshare, and those can vary based on the property you buy into. But you’ll also have an upfront cost to grapple with. And if you don’t have the money in savings to pay for a timeshare purchase outright, then you’ll need to explore options for financing it.

Unfortunately, you can’t turn to a mortgage loan to finance a timeshare purchase. The reason? You’re not actually buying a home you own. Rather, you’re buying the right to use a property. But while a mortgage may be off the table, here are two other options you can explore.

1. A home equity loan

If you own a home already, and you’ve built up equity in it, you may be able to borrow against that equity in a fairly affordable manner. The great thing about home equity loans is that you don’t have to use those funds for improving or fixing up your own home. So you could take out a home equity loan and use it to finance your timeshare.

2. A personal loan

Often, the companies that sell timeshares will try to match you up with a lender who can set you up with a loan to finance your purchase. You could go that route or look at other personal loan lenders and see which one is most affordable.

A personal loan lets you borrow money for any purpose, so you could take one out and use the proceeds to cover the upfront costs associated with your timeshare. It’s a good idea to shop around and see what interest rates different lenders are offering, keeping in mind that the higher your credit score, the less interest you’re likely to pay.

Should you buy a timeshare if you can’t pay for one outright?

If money is tight and you’re worried about falling behind on any sort of loan payment, then it’s best not to purchase a timeshare. But if you can swing the ongoing fees and monthly loan payments, then you may find that a timeshare is a good purchase — especially if you have a favorite vacation spot that’s gotten increasingly difficult and expensive to book.

Just keep in mind that when you buy a timeshare, you don’t actually own property — whereas if you buy a vacation home, you can build equity in it and eventually sell it at a profit. So you may want to take the time to consider both options carefully before moving forward with a timeshare purchase.

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Credit cards offer protections and perks that can really come in handy. 

A wedding is intended to be a public celebration of your love, and the industry is a seriously big business. In fact, the average cost of a wedding in 2022 was $27,000. If you’re hoping to spend a similar amount for your special day, you may be wondering how to pay for it. You might be fortunate enough to have family help, or maybe you’ve been saving money for years leading up to this point.

You could also consider a wedding loan, but I don’t recommend going into debt for a wedding. After all, it’s essentially what amounts to a big party, and you don’t want to be paying off debt long after your friends and family stop calling you “the newlyweds.”

However, in terms of actually making payments to your vendors and for your venue, I do recommend using a credit card (and then paying off the full balance with that money you’ve got stashed away). Here’s why.

1. You’ll get loss protection

A friend of mine from my undergraduate days recently told me a story about why “use a credit card” was the best piece of wedding advice she got. Her wedding venue was shut down before her ceremony due to permit violations — it was a sketchy situation. She had paid $1,000 as a deposit to secure her ceremony’s location. Since she had paid it using her credit card, she was able to get the cost refunded by turning the matter over to her credit card company. Other couples who had booked this venue and made cash deposits were not so lucky.

Credit card purchase protections can really come in handy, serving as back-up insurance in some situations. For example, if your wedding dress is stolen, and you used your credit card to pay for it, you might be able to get reimbursed for part of its cost. Read the fine print for the card you’re considering using for wedding expenses.

2. You can easily keep track of your expenses

It’s always a good idea to keep records of all the expenses you’re paying for a big project like planning a wedding. Using a credit card can make this much easier, if you’re using the same card for everything. You’ll be able to sign into the issuer’s website (or the card’s mobile app) and see all your costs, along with the date you paid them. Easy!

3. You can earn cash back or points

Here is a major reason to use a credit card to cover those wedding costs. You can earn rewards on your spending with some credit cards, such as cash back. Do your research and pick the card that offers the best rewards on the spending you intend to do. You might also consider using a travel rewards credit card if you’re planning a great honeymoon.

4. You might get 0% APR financing for a time

If you do need to finance part of your wedding costs, and you know that you’ll be able to pay off those charges within a relatively short period of time, you could do worse than using a credit card with an introductory 0% APR period. This could be as long as 21 months for the best cards out there, giving you nearly two years to pay off your balance. Assuming you didn’t charge a huge amount you can’t afford to pay off, you can finance those costs without paying any interest.

Do note that you will still need to make at least the minimum payment during that 0% APR period, and it pays to do the math yourself, rather than relying on the credit card company’s required minimum. If you’ve got a $5,000 balance and 21 months to pay it off, you can make payments of $238 per month and pay off your balance before you get charged extra.

As you can see, it could make sense to use a credit card to pay your venue, vendors, and even your honeymoon expenses. Just make sure you’re making your payments on time, and ideally paying off your balance before you have the chance to earn interest — you don’t want to start your new married life with that kind of burden strapped to your back.

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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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Do they even make phone calls anymore?! 

In some ways, managing your personal finances hasn’t changed much in decades. The basics of balancing budgets, tracking expenses, and even using coupons are all relevant today.

Though many of the concepts and methods are similar, the tools we use have evolved to keep up with our fast-paced digital lifestyles. Perhaps the most important modern tool for managing your finances?

Your phone.

From mobile banking to budgeting apps, you can manage basically every aspect of your finances with your little pocket computer. What’s more, your smartphone is also one of the best tools for saving time and money while shopping. Here are some examples.

1. Shopping lists you won’t forget

One of the most foolproof ways to stay on budget while shopping, especially in the grocery store, is to shop according to a list. This helps you get all the things you really need, while helping avoid the temptation of impulse buying things you don’t.

Or, at least, it would be foolproof — if I could remember the darn list. Somehow, between home and the store, that little piece of paper seems to up and vanish more often than not.

The solution? I put the list on my phone. Since I’m more likely to leave the house without shoes than without my phone, this one move has saved me time and money (and no small amount of my sanity).

It doesn’t matter how you keep your list, so long as it works for you. Most smartphones offer some kind of preloaded notes app, reminders list, or to-do feature that you can use to create your shopping list.

2. Easy digital coupon clipping

Back in the olden days, when you joined a store’s frequent shopper program they gave you a physical card with a barcode (and occasionally a really hideous picture of yourself).

In a boon for wallets everywhere, those days are gone. Now, it’s all about the mobile apps.

Pretty much every major retailer (and no small number of the smaller ones) have their own apps, and the best ones are actually really useful. Among the many features, most retailer apps include a simple way to add digital coupons to your account. Even better, many retailers include app-exclusive coupons you won’t find anywhere else.

In addition to retailer apps, there are a ton of third-party savings apps you can use, too. These cash back apps have coupons and rebates you can stack with retailer coupons for extra savings.

3. Quick barcode comparison shopping

Another great perk offered by many retailers’ mobile apps are in the in-app barcode scanners. These handy tools let you use your phone’s camera as a barcode scanner so you can price check items while you shop.

While this is a great tool for finding prices on unlabeled items in the store, it has another, and arguably better, application: comparison shopping. Since barcodes are generally universal, you can scan an item with different mobile apps to find its price across various stores.

For example, you may come across a sale on your dog’s favorite treats while browsing Target. But how do you know if it’s actually a deal? A quick barcode scan with your Petco and Walmart apps lets you compare prices in minutes without leaving the pet aisle.

It really is an all-in-one device!

Like many folks of earlier generations, I’ve done my fair share of lamenting for the days when phones were just things that made calls. The rose-colored simplicity of pre-smartphone life seems quaint (and quiet) in retrospect.

In reality, however, I am one of the many who depend on my phone for — well, just about everything. And that everything includes a whole lot of ways to save both time and money. Whether you simply want a harder-to-lose grocery list or go all-in on retail apps, your phone can be one of your best tools to save money.

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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.Brittney Myers has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Target and Walmart. The Motley Fool has a disclosure policy.

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The Justice Department says nobody should be denied credit because of their race and is taking steps to combat lending discrimination. 

City National Bank has agreed to pay over $31 million in loan subsidies and outreach activities as part of a settlement with the Justice Department on redlining. The bank says it does not agree with the allegations, but supports the DOJ in its efforts to ensure all customers can access fair lending. Find out what redlining is and what you can do if you’ve been unfairly denied credit.

What is redlining?

The word redlining is used to talk about various forms of discriminatory home loan practices. It applies to situations where people are denied mortgages, loans, or insurance based on where they live, rather than their own credit worthiness. It originated because of the way authorities drew red lines on maps to indicate mixed race or predominantly Black and Hispanic neighborhoods that were deemed more risky in terms of lending.

As a result, those areas were starved of investment for decades. According to the New York Times, it shaped “racial disparities in America in access to housing, credit and wealth accumulation.” Not only did the lack of affordable loans and mortgages affect property prices, it impacted people’s lives in a host of other ways. At the heart, it stopped people in redlined areas from investing in their homes and building wealth. It also led to an increase in predatory lending practices as residents couldn’t access other lending products.

City National Bank’s $31 million settlement

The Justice Department’s settlement with City National Bank is part of a wider initiative to address redlining. The Justice Department is working with the Consumer Financial Protection Bureau (CFPB) and the Office of the Comptroller of the Currency to combat redlining nationwide.

“When people are denied credit simply because of their race or national origin, their ability to share in our nation’s prosperity is all but eliminated,” said Attorney General Merrick B. Garland. In a press release, Garland said the settlement with City National Bank is the “largest redlining settlement in Department history.”

As part of the over $31 million agreement, City National Bank will:

Invest $29.5 million on loan subsidies in Black or Hispanic neighborhoods in Los Angeles County.Spend $1.75 million on advertising, outreach, education, and partnerships in affected neighborhoods.Open one new branch and employ more loan officers in majority-Black and Hispanic neighborhoods.

The City National Bank has not admitted any wrongdoing. In a statement, the bank said, “We disagree with the allegations, but nonetheless support the DOJ in its efforts to ensure equal access to credit for all consumers, regardless of race.”

What to do if you’re the victim of lending discrimination

It is illegal to refuse someone credit or offer them less favorable terms because of race, color, sex, age, or other factors. Unfortunately, as the story above shows, it still happens and it isn’t always easy to spot. If you are concerned about lending discrimination, here are steps you can take.

1. Know your rights

It’s important to understand what is and isn’t allowed when you’re applying for a loan. The Equal Credit Opportunity Act contains a lot of provisions designed to prevent discrimination. For example, a lender is allowed to ask you about your race or sex, but you have the right not to answer. Lenders are also required to give you specific reasons as to why an application was rejected or tell you that you’re entitled to know the reason if you ask within 60 days.

Before you apply for a loan, check your credit report. Your credit report is used to calculate your credit score, and through 2023 you can get free weekly credit reports online at AnnualCreditReport.com. Look to see if there are any errors, as these may impact your ability to qualify for a loan.

2. Shop at multiple lenders

Whether you’re in the market for a personal loan or mortgage, getting quotes from several lenders can help you get the best terms for your financial situation. Rate shopping may also raise red flags in terms of discriminatory lending practices. One lender may offer you a significantly higher interest rate or more unfavorable terms than others. It may deny the loan. This could be an indication there’s something else going on.

If you’re worried about the impact of rate shopping on your credit score, it will take a ding when lenders carry out a hard credit check, which they do when you apply for a loan. However, the credit bureaus treat all applications made within a short timeframe as just one inquiry. That means rate shopping won’t hurt your score any more than a single application would, as long as you make all the applications around the same time.

3. Report discriminatory practices

If you encounter discrimination when applying for a mortgage or loan, it’s worth speaking up. There are a few ways you can report the situation, including speaking directly to the lender, and contacting your state attorney general’s office. You can also report discriminatory practices directly to the Department of Justice online, contact the CFPB, or the Department of Housing and Urban Development.

Bottom line

The practice of redlining had a huge impact on racial segregation in the United States, as well as people’s ability to own and invest in their homes. There are now laws in place to prevent lending discrimination, but unfortunately it still happens and the impact of historical actions are still felt today.

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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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Self-made millionaires are regular people, but they have habits that set them apart. 

Becoming a millionaire might seem like a lofty or even impossible goal. The truth, however, is that many millionaires are self-made. And they build their wealth largely on the back of good money habits.

Vivian Tu, also known as Your Rich BFF on social media, says she became a millionaire at age 27. She recently published a video on YouTube where she revealed five habits of self-made millionaires. They’re all excellent habits that can make a real difference in your financial situation.

1. They focus on making as much money as possible

Self-made millionaires are extremely proactive about increasing income. Some of them have their own businesses, and some work for others as employees. But what they all have in common is that they continually try to earn more and more. They work hard, they aim to be top performers, and they seek out raises or promotions.

This is a must, because as Tu puts it, “you can only save as much as you earn.” Although being frugal can help you save more, it only goes so far. Eventually, you run out of expenses to cut, or it starts to affect your quality of life.

Income matters. You can save a whole lot more making $80,000 per year than $40,000. You don’t need to make a massive salary to become a millionaire, but you should aim to consistently increase your earnings.

2. They invest

There’s only so much that a person can work. Self-made millionaires also make sure that their money is working for them. They do this by investing their money so it can grow and bring them passive income. Even when they’re not working, their money is.

There are many ways to invest. Arguably the most effective is investing in the stock market. This provides great returns at a relatively low risk. Over the last 50 years, the average stock market return has been 10% per year.

Anyone can invest, and it doesn’t take a lot of money. To get started, open an account with any of the top online stock brokers. Then, you can choose investments. If you want to keep it simple, index funds and exchange-traded funds (ETFs) are an easy way to invest. These contain a basket of stocks, so you get a diversified portfolio with just one investment.

3. They practice discipline and delayed gratification

Tu says the one difference she has noticed in her friends who are self-made millionaires is that they’re more disciplined and better at delaying gratification. They avoid overspending on things they don’t need, especially when they’re young, allowing them to invest at a young age.

That makes a huge difference. If you start at 20 and you want to retire with $1 million at 65, you could get there investing $116 per month. But if you get started at 40, it’s going to take $847 per month.

There’s nothing wrong with spending money on yourself. In fact, it’s good to set some money aside every month for guilt-free spending. The key is to balance that out by consistently saving and investing money, as well.

4. They acknowledge when they’re wrong and move on

Everybody makes mistakes. You can find plenty of stories about millionaires who have gone through business failures or made poor investments. What makes successful people different is that they’re able to change their minds quickly on a bad idea.

This is a good habit to improve at personal finance and at life in general. Lots of people struggle with changing their minds. Once they have a plan or an idea, they cling to it. It’s important to recognize when something isn’t going to work so you can move on and not waste your time or money.

5. They set ambitious goals

Most self-made millionaires are all about planning. As Tu puts it, “You don’t become a millionaire if you don’t make a plan.” Successful people set goals, and just as importantly, they set ambitious goals that will be challenging to reach.

Along with their goals, self-made millionaires also create plans with concrete steps they can follow to get there. For example, maybe you want to be a millionaire by a certain age. Next, think about what steps you’ll need to follow to complete that goal. These will likely include things like investing a set amount per month and regularly raising your income.

Self-made millionaires aren’t an exclusive group, and they don’t have special traits that ordinary people can’t develop. If you work on building those five habits, they’ll help you take some big steps financially.

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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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