Money Management

It’s a goal worth working toward. 

If you’re sitting on a heaping pile of credit card debt right now, you’re definitely not alone. A lot of people were forced to charge expenses on their credit cards and carry balances forward this year due to inflation. And also, now that the holiday season is winding down, you may be sitting on a larger credit card balance due to having charged things like gifts and travel costs.

But no matter why you have credit card debt, your best bet is to get rid of it as quickly as you can. Credit card interest can compound on a daily basis. What this means is that for every extra day you carry a balance forward, it costs you more money.

In a recent Principal survey, 28% of respondents listed paying off credit card debt as a big goal. If you feel the same, here are some key steps to take.

1. Give yourself a break from accruing interest

The reason credit card debt has a tendency to spiral is that credit cards often charge high rates of interest to begin with, and then, as mentioned earlier, compound that interest daily. And so a good way to get out of credit card debt is to get a break from paying interest for a period of time.

That’s more than possible if you qualify for a balance transfer offer with a 0% introductory interest rate attached to it. Now that 0% rate won’t last forever. But it might last 12 months, 15 months, or even 18 months, depending on the offer you’re able to snag. And not racking up more interest for many months could make it possible to get ahead of your debt.

2. Free up money for debt payoff purposes

If you spend every dollar in your paycheck month after month, paying off debt will be a huge challenge. That’s why you’ll need to commit to cutting back on spending if you’re eager to shed your credit card debt quickly.

Take a look at the things you spend money on regularly. Is it possible to eliminate one or two bills (even on a temporary basis) without too negatively impacting your life?

Maybe the idea of skipping takeout meals is enough to make you want to cry. But if that’s something you currently pay for three times a week, cut down to once a week. Then, take the money you’re saving and use it to pay down your credit card balance.

3. Get a side hustle

These days, a lot of people are spending minimally on non-essential expenses because inflation is causing their basic bills to soar. If that’s the case, then cutting your spending may not be enough to make headway on your credit card debt. You may need to boost your income with a side hustle and use your earnings to dig out of that hole.

The good news is that side gigs are fairly easy to come by these days, so think about what your schedule allows for and find a job that matches up. If you need the flexibility to set your own hours, driving for a ride-hailing service might work. And if you need a side gig you can do from home, look into online jobs, whether it’s social media marketing, remote tutoring, or content editing. You may even be able to land a medical billing gig you can do from your living room.

Credit card debt can be a drag, no matter how much or how little of it you have. Follow these tips to get out of debt — and you’ll have one fewer nagging expense to worry about.

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It’s all about minimizing your stress load and avoiding errors. 

Although filing a tax return is something many of us have to do on an annual basis, it can be a stressful process. This especially applies if you own a small business, are self-employed, or have income coming in from a number of different sources, like a side hustle and brokerage account on top of your primary paycheck.

In 2023, the tax-filing deadline will be Tuesday, April 18. Usually, the filing deadline is April 15, but that falls on a Saturday next year. And when that happens, the IRS makes a point to push the deadline out to the next business day.

If you’re wondering why the tax-filing deadline isn’t Monday, April 17, the reason is that it’s Emancipation Day, a Washington, D.C. holiday. And the IRS doesn’t like to make taxes due on a holiday.

Because taxes aren’t due until April, you may be inclined to hold off on working on them until, well, April. But actually, you’re far better off starting to tackle your tax return in January. Here’s why.

Starting early can make the process easier

Any time you’re forced to rush through a task, you run the risk of making an error. The same holds true for filing taxes.

If you wait too long to start working on your tax return, you might make a mistake that causes you to end up with a lower tax refund. Or, your error might make you more likely to end up on the IRS’s audit list (such as if you forget to report income that the IRS has been made aware of).

Plus, the sooner you start working on your taxes, the less stressed you’ll be. And that alone is a good reason to give yourself extra time.

What’s more, if you’re working with a tax professional to get your return done, the sooner you sit down together, the sooner you can figure out if you’re missing documentation needed to complete your return. And that could help you avoid issues later on in the filing season.

Finally, the sooner you complete your tax return, the sooner your tax refund can hit your bank account if you’re entitled to one. And if you could use a lump sum of money to cover bills or perhaps pay off some holiday debt, then you might as well do what you can to get it as quickly as possible.

Most years, the IRS starts accepting tax returns at the end of January. So if you’re able to get yours done early, you’ll not only check a big task off of your list, but also, potentially get yourself an expedited payday.

It pays to get a jump start

January is when a lot of people start focusing on career-related goals and the recent New Year’s resolutions they’ve set for themselves. While you’re doing those things, take some time to start working on your tax return.

You don’t necessarily have to pressure yourself to complete that return in January, especially if you’re not particularly desperate for your refund. But getting the ball rolling could work to your advantage and spare you a lot of scrambling in the months ahead.

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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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Here’s why small town living really is a mixed bag. 

City life isn’t for everyone. And there may come a point when you decide that you’re ready to ditch the city and settle somewhere that isn’t always bustling. You may even decide to buy a home in a small town.

In 2022, the share of homes purchased in a small town reached an all-time high of 29%, according to recent data from the National Association of Realtors. But is small town living right for you? Here are some benefits and drawbacks to consider.

Pro No. 1: Lower home prices

Homes located in smaller towns aren’t always as desirable as those located in large suburbs or cities. As such, you might spend less on a home you buy in a small town. That could mean taking on a much more affordable mortgage loan. And given how high mortgage rates are these days, that’s an important thing.

Pro No. 2: A lower cost of living

In many cases, you’ll enjoy a lower cost of living across the board in a small town versus a city or more populated area. And at a time when living costs are up across the board due to inflation, that’s a benefit.

Pro No. 3: Getting to be part of a close-knit community

When there are only a few hundred people who live in your town, it’s conceivable that you might end up knowing and building relationships with everyone in your town. That can be a really nice thing, especially if you’re the type of person who values community and likes having neighbors who look out for one another.

Con No. 1: Fewer job opportunities

When you live in a small town, you may not have the same access to jobs as you would in a larger town or city. And unless you have a job you can do remotely, that could mean facing a lengthy, unpleasant commute to work on what could be a daily basis.

Con No. 2: Fewer amenities

It costs money to open and operate a business. And small businesses may be less likely to set up shop in a small town because they’re looking at a very limited customer base — and limited revenue. And so if you move to a small town, you may find that you don’t have many nearby restaurants, cafes, and stores to choose from.

Con No. 3: The potential for fewer public services for children

If you live in a town that doesn’t have many children, you may not have access to a great library or parks system. And the school system may not be what you want it to be. If you have children, it’s important to do plenty of research before buying a home in a small town. Even if the public services are reasonable, you’ll need to think about the implications of putting your children in a school where their entire graduating class might consist of fewer than 25 students.

Clearly, buying a home in a small town can be a mixed bag. If you’re not sure whether it’s right for you, talk to people who have lived in small towns to hear more about the experience. And, if possible, spend a decent amount of time in the town you’re thinking of moving to so you know what to expect. The more information you have, the more confident you can be in your decision.

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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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Is it worth trying out any of these side jobs? 

If you’re hoping to bring in more money for financial goals such as debt paydown or growing your bank balance, a side gig could be the solution. There are numerous part-time positions that you can do around your schedule, many of which can be quite lucrative.

If you’re not sure where to start in looking for a side hustle you can do along with your regular job, finance expert Dave Ramsey has a few suggestions worth considering.

Dave Ramsey recommends these side hustles

On the Ramsey Solutions blog, a whopping 27 side hustle ideas were recommended. These part-time flexible gigs included:

Driving for a ride sharing service such as Lyft or UberDelivering food through an app like Grubhub or UberEatsDelivering groceries through a service like Instacart or ShiptTaking professional photographs, such as family portraitsOffering online tutoring through sites like Tutor.comTranscribing live or recorded audio into written formCompleting surveys online or taking part in focus groupsTeaching English through services like VIPKid that prepare lesson plans for youRenting out your property on AirbnbThrifting items and reselling them at a profitFreelancing on sites like Fiverr or Upwork if you have writing or design talentCooking for othersBabysittingBecoming a secret shopper or user tester through sites like TryMyUIPet sitting or walking dogs using apps like Wag or RoverHouse cleaningSelling crafts or other products on EtsyTeaching people how to play a musical instrumentCompleting errands or tasks for others using sites like TaskRabbitDoing freelance writing work for clients privatelyCleaning up cars by washing or detailing themMowing lawns or taking care of people’s yardsBecoming a life coach, career coach, sports coach, or other type of coachDelivering packages for Amazon FlexSelling fresh baked goodsPlanning eventsDoing people’s makeup

This list is fairly comprehensive and includes both high-skill and low-skill side gigs. In many cases, there are apps you can use to easily get started and connect with customers so you don’t have to build a client base yourself (which is often the most difficult part of starting a business of your own).

In many cases, some of these side gigs would take minimal or no start-up costs on your part, and you could put as much (or as little) time into them as you wanted to. Of course, the more side gigs you try and the more hours you devote to them, the more likely it is you’ll be able to make good money.

Is a side gig right for you?

Bringing in extra money by doing a side job can undoubtedly help you to get ahead financially. Most likely, you already have your regular income earmarked for bills and other expenses. And while you can try to cut costs to save more of it or use it to pay down debt, there are some expenditures you really can’t eliminate entirely.

If you can bring in more income, though, this is money that doesn’t already have a purpose so you can use all of it for important goals. So, if you have even a little bit of free time you can devote to making more, and having extra funds is important to you, there’s no reason not to try one or more of the suggestions on Ramsey’s list.

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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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