Money Management

Putting Costco’s generous return policy to the test really paid off. 

A very long time ago, I bought a Keurig coffee machine from Costco. I set it up and it never really worked right, so I was going to return it to the store for another one.

Unfortunately, shortly after I purchased it, I moved. The item ended up getting stuck in a box for years since the box got pushed to the back of the basement and not unpacked for some reason. When I moved again and found it, I was pretty upset that I had put over $100 on my credit card for an item that didn’t work and was out the money since I’d forgotten to follow through with the return.

Then, I remembered Costco’s great return policy. With some exceptions (such as for electronics and large appliances), Costco guarantees your satisfaction and accepts returns — generally with no time limit.

I wasn’t sure if the Keurig would be considered an appliance or an electronic device, and it had been years since I bought it, but I decided to take it into the store and explain what happened and see if they would take it back. Here’s what happened when I did.

Costco’s return process amazed me

When I took my ancient Keurig back to Costco with me, it was years outdated and had been replaced by many newer models. I was also no longer a Costco member. So, I didn’t have very high hopes for actually being able to return the item.

Still, I explained to the customer service associate exactly what had happened with the unit. Much to my amazement, she was very sympathetic. She understood what had happened and she said that Costco’s return policy was there to make sure customers were happy. Since I wasn’t happy, they would make it right and accept a return.

I did have to get a store gift card for the value of the Keurig rather than getting money back directly, but that was just fine with me. They were actually able to look up the purchase price that I had paid for the Keurig years ago and put the entire amount on a gift card — well over $100.

Since I am no longer a Costco member, I wasn’t sure how I would be able to spend it. But the customer service associate let me know that I could just shop with the gift card in store despite not having a membership.

I was able to take the gift card with me to buy a brand new Keurig (which had come down considerably in price since my initial purchase) and had money left over to take advantage of some of Costco’s other great deals.

Costco’s return policy is a big reason to shop there

There are lots of good reasons to shop at Costco, but the store’s generous return policy and commitment to customer satisfaction is definitely near the top of the list. The fact that the store took back a years-old Keurig from me without any complaints or questions really convinced me that they do care about my shopping experience.

In a day and age when good customer service can be hard to come by, this really helps to set Costco apart from the crowd and can be enough by itself to make the store’s membership fees well worth paying.

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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.Christy Bieber 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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Image source: Getty Images
What HappenedGas prices could fall slightly in the coming months, but they’re unlikely to stay low throughout 2023. Analysts think prices could peak at $4 per gallon or more next summer. “2023 is not going to be a cakewalk for motorists. It could be expensive,” said Patrick De Haan, head of petroleum analysis at GasBuddy.So WhatGasBuddy’s 2023 Fuel Outlook offers some good news for motorists who are still reeling from an extraordinary year, price wise. It predicts the yearly national average will drop to $3.49 per gallon in 2023, almost $0.50 less than 2022.The report points to increased global refinery capacity as a reason for optimism. However, it raises concerns about economic uncertainty, climate issues, and the war in Ukraine. It says the average household spent about $2,748 on gas in 2022, almost 40% more than the year before. GasBuddy predicts average gasoline spending will decrease slightly to $2,471 in 2023. Now WhatHigh gas prices can put a big dent in our bank account balances. But there are ways you can reduce the pain:Driving less: Many Americans changed their habits this year because of high prices at the pump. Some cut their mileage by combining errands or cutting non-essential trips. Others switched to public transportation or opted to walk or bike to reduce costs. Regular car maintenance: Vehicle checks can improve safety as well as efficiency. For example, Fuel Economy says that replacing a clogged air filter or inflating your tires could help you squeeze more miles from each gallon.Maximizing rewards: If you spend a lot of money on gas, see whether a gas credit card could work for you. It’s also worth finding out if gas chains you use regularly have loyalty programs.Shopping around: Gas prices vary from pump to pump, so watch out for lower-cost gas stations in your area. There are several apps that can help you find the cheapest gas near you, including GasBuddy and AAA.Many Americans rely on their cars to get to work or take the kids to school, making it difficult to avoid high gas costs completely. However, a few shifts in behavior could translate into decent savings, particularly if gas prices start to creep up again in the summer.Alert: highest cash back card we’ve seen now has 0% intro APR until 2024If 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 reviewWe’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. 

What Happened

Gas prices could fall slightly in the coming months, but they’re unlikely to stay low throughout 2023. Analysts think prices could peak at $4 per gallon or more next summer. “2023 is not going to be a cakewalk for motorists. It could be expensive,” said Patrick De Haan, head of petroleum analysis at GasBuddy.

So What

GasBuddy’s 2023 Fuel Outlook offers some good news for motorists who are still reeling from an extraordinary year, price wise. It predicts the yearly national average will drop to $3.49 per gallon in 2023, almost $0.50 less than 2022.

The report points to increased global refinery capacity as a reason for optimism. However, it raises concerns about economic uncertainty, climate issues, and the war in Ukraine. It says the average household spent about $2,748 on gas in 2022, almost 40% more than the year before. GasBuddy predicts average gasoline spending will decrease slightly to $2,471 in 2023.

Now What

High gas prices can put a big dent in our bank account balances. But there are ways you can reduce the pain:

Driving less: Many Americans changed their habits this year because of high prices at the pump. Some cut their mileage by combining errands or cutting non-essential trips. Others switched to public transportation or opted to walk or bike to reduce costs. Regular car maintenance: Vehicle checks can improve safety as well as efficiency. For example, Fuel Economy says that replacing a clogged air filter or inflating your tires could help you squeeze more miles from each gallon.Maximizing rewards: If you spend a lot of money on gas, see whether a gas credit card could work for you. It’s also worth finding out if gas chains you use regularly have loyalty programs.Shopping around: Gas prices vary from pump to pump, so watch out for lower-cost gas stations in your area. There are several apps that can help you find the cheapest gas near you, including GasBuddy and AAA.

Many Americans rely on their cars to get to work or take the kids to school, making it difficult to avoid high gas costs completely. However, a few shifts in behavior could translate into decent savings, particularly if gas prices start to creep up again in the summer.

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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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It pays to run through these before submitting your application. 

There’s a reason so many consumers find personal loans appealing. These loans let you borrow money for any purpose, and they often come with lower interest rates than other means of borrowing.

You may be thinking of getting a personal loan once the new year kicks in. But here are four questions you’ll definitely want to address first.

1. Am I borrowing for a need, or for a want?

If you have a stove that barely works and kitchen cabinets that are pretty much about to cave in, then it’s easy to argue that a kitchen renovation is a need. And a personal loan could be a good way to finance one.

But generally speaking, if you’re going to take on debt at a time when interest rates are up across the board (which is the case right now), then you should really limit yourself to situations where you’re addressing a need. You should probably hold off on getting a personal loan to take a vacation or replace a still-decent furniture set with a newer one.

2. Is my credit score in good shape?

Personal loans are unsecured. This means they’re not backed by a specific asset (whereas a mortgage, for example, is a secured loan, and the home being financed serves as collateral for it). Because of this, it’s important to have great credit at the time of your personal loan application. The higher your score, the more likely you are to qualify for a competitive interest rate.

If you don’t know what your credit score looks like, access it before applying for a personal loan. If you see that it could use a lift, you may want to hold off on that loan and boost it first.

3. Have I explored other borrowing options?

Personal loans can be quite cost-effective from an interest rate standpoint. But a personal loan may not be your cheapest borrowing option. If you own a home, for example, borrowing against its equity could leave you paying less interest on the sum you borrow. So it’s a good idea to explore different options and crunch some numbers before deciding that a personal loan is your best bet.

4. Is this the only loan I’ll need this year?

You may have no plans to borrow money in 2023 other than to get a personal loan. But if you’re applying for a large loan, like a mortgage, then you may want to submit that application first.

Owing money on a personal loan could make it harder to qualify to borrow for a home, since mortgage lenders look at your outstanding debt relative to your income when making that determination. So you’re better off having less debt before your mortgage application, and if anything, getting a personal loan once you’ve closed on your mortgage.

Getting a personal loan may not be a bad idea in 2023, especially if you’re taking one out to address an issue that directly affects your quality of life. But it definitely makes sense to answer these questions before putting in an application.

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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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These moves could be your ticket to mortgage approval. 

Although it’s possible to purchase a home without signing a mortgage, most people don’t have hundreds of thousands of dollars in cash just hanging out in their savings accounts. So chances are, if your goal is to buy a home in 2023, you’ll need a mortgage to make that purchase possible.

But getting approved for a mortgage isn’t always a breeze. Mortgage lenders, by nature, give out large sums of money. And so they tend to be very careful about who they approve. If you want to increase your chances of getting a mortgage in 2023, here are some key moves to make.

1. Boost your savings

If you’re applying for a conventional mortgage, you’ll need to prepare to put some amount of money down at closing. You don’t necessarily have to put down 20% — though doing so will help you avoid private mortgage insurance, which is an added cost you’d probably rather steer clear of. But you may need to put down 10% of your home’s purchase price. And given today’s home values, that’s a tall order.

Your best bet, therefore, is to give your savings as much of a boost as possible. The more you’re able to put down on a home, the more equity you’ll have from the start. And lenders like to see candidates who have a decent amount of money to put down, as it means they’re taking on less of a risk.

2. Boost your credit score

Your credit score tells lenders — mortgage and otherwise — how reliable you are from a borrowing standpoint. A higher score sends the message you commonly pay bills on time and manage your debts well, while a lower score sends the opposite message.

It takes a minimum credit score of 620 to qualify for a conventional mortgage. But some lenders are apt to want a higher score than that.

Also, while a 620 might allow you to get a mortgage, it won’t necessarily render you eligible for a mortgage at a competitive interest rate. So if you’re able to give your credit score a lift, it could make mortgage approval much more possible.

3. Boost your income

Maybe your credit score is downright outstanding. But when you’re asking to borrow a huge sum of money, great credit isn’t enough. You also need to be able to show a lender that you’re capable of paying for a mortgage. And so the higher your income is, the more likely you are to qualify to borrow for a home.

So how do you raise your income if your company won’t budge on salary? The answer could come down to getting a side gig on top of your main job. If you earn an extra $1,000 a month, for example, that’s income that will count toward your ability to repay a mortgage.

Qualifying for a mortgage certainly isn’t a given. But if you make these moves, you can set yourself up to not only get approved for a home loan, but potentially have different lenders fighting for your business.

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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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You’re getting close to retirement, as long as you make the right money moves. 

Your 50s could be when you start to feel much more comfortable and settled in financially. While the first few decades of a career are often hectic, 50 is normally when people have reached their peak earning period. You’ve also had plenty of time to accumulate investments, which could be earning lots of compound interest by now.

This is the home stretch, and depending on your current nest egg, retirement could be just five to 10 years away. To avoid any last-minute pitfalls, here are five personal finance goals that are well-suited for 50-year-olds.

1. Have at least five times your yearly salary saved

A popular rule of thumb is to have at least five times your yearly salary saved by the time you’re 50 years old. Meaning, if you make $80,000 per year, you should have at least $400,000 across your retirement accounts and bank accounts.

That’s no small sum, and lots of 50-year-olds aren’t there yet. You shouldn’t get down on yourself if you don’t quite meet this goal. However, this is a good gauge of whether you’re on track to retire by 65. If you haven’t hit this mark, it’s a sign you likely need to shift more of your money to retirement savings.

2. Max out your retirement contributions

One of the benefits of reaching your 50s is that you can contribute more to tax-advantaged retirement accounts. For 2023, the 401(k) contribution limit is $22,500 for those under 50, but it’s $30,000 for those 50 and older. You can also contribute up to $7,500 to IRAs in 2023 if you’re 50 or older, which is $1,000 more than the limit for those under 50.

Try to max out these limits, or get as close as possible, especially if you’re behind on retirement savings. Even if you’re on track, you might still want to contribute as much as you can to your retirement plans. It never hurts to have more money for retirement, and this could even allow you to retire earlier than you planned.

3. Take care of your estate planning

At this stage of life, everyone needs an estate plan, which specifies what will happen to your assets in the event of incapacitation or death. It’s not the most enjoyable subject to think about, but taking care of your estate planning will give you peace of mind. By doing this yourself, you can rest assured that your family won’t have to sort out your finances themselves should anything happen to you.

You may want to consult with an estate planning attorney to help with this, especially if you have substantial assets. At a minimum, here are the estate planning documents everyone should have:

A last will and testament directing the disposition of your assetsFinancial power of attorney authorizing someone else to represent you in certain matters if you become incapacitatedHealthcare power of attorney authorizing another person to make healthcare decisions for you if you become incapacitatedA living will providing guidance on healthcare decisions in situations where you can’t express informed consent

4. Pay off your mortgage — and any other debt you have

Since you’re close to retirement, this is a good time to focus on getting rid of debt. That way, you’ll have fewer monthly expenses to worry about when you stop working and are living with less income.

If you have multiple debts, start with the one that has the highest interest rate and work your way down. For example, if you have credit card debt, an auto loan, and a mortgage, tackle them in that order. You’ll save the most on interest charges in doing so.

Many people are still paying their mortgages at this age. It’s fine if you haven’t paid off your mortgage yet, but try to finish this up during your 50s.

5. Get detailed with your retirement plans

You may have already figured out some tentative details in your retirement planning, such as a target retirement age and amount to save. Once you’re in your 50s, you can iron these out more. Here are some questions to ask yourself:

Where will you retire? Some retirees stay where they are, but there are also plenty who change states or even retire abroad.When will you take Social Security? If you have enough in your retirement accounts, waiting to take Social Security will get you a larger benefit.How will you withdraw money? There are multiple retirement withdrawal strategies. You’ll need to choose one that provides enough to live comfortably while also ensuring you don’t run out of money.What will you do for healthcare? If you currently have great health insurance through your work, think about how you’ll replace that when you retire. Medicaid tends to be the most affordable option, but there are also other health insurance plans for retirees.

For most people, their 50s aren’t when they make huge financial changes. Instead, this decade is when you make that final push for retirement by saving as much as you can and paying off any debts. It’s also the time to handle all your important financial planning, including retirement planning and estate planning.

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

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