Money Management

Trust me when I say I’m not celebrating. 

For many people, late November is one of the most celebrated times of the year. It’s when the holiday season officially kicks into gear, when neighborhoods light up with shining decor, and when people are generally just in more of a giving spirit.

But in my neighborhood, late November wasn’t such a great time of the year for a lot of homeowners. That’s because we got our annual property assessment cards in the mail right around Thanksgiving time. And many of us saw numbers we weren’t happy with.

I live in a part of the country where home values are higher than average. As an example, a $600,000 home in my neighborhood isn’t particularly large or updated — it’s really your typical three- or maybe four-bedroom home. In another part of the country, $600,000 might buy you a mansion on an acre of land.

Because home prices are up on a national level and home values in my area are higher to begin with, a lot of people in my neighborhood saw their assessments increase by $100,000 or more this past November. And I was in that very boat.

Now you’d think that a higher home value would be something homeowners would celebrate. And some people may be happy about those higher numbers. Here’s why I’m not.

I won’t gain anything from a higher home value

If I were looking to sell my home, then I’d definitely be thrilled with a higher assessment, because it could easily make the case for a higher asking price. But I’m not selling my home.

First of all, I’m content where I am. And also, selling my home could mean having to yank my kids out of their school district and off of their sports teams. That’s not something I’m eager to do.

Plus, home prices are up so much right now that even if I were motivated to move, and even if I were to sell my house at a nice profit, what I’d gain there, I’d end up spending on another overpriced home. Oh, and since mortgage rates are up, any new home would probably end up costing me a lot more — even with a large down payment.

Not only am I not planning to sell my home any time soon, but I’m also not planning to tap my home equity for a loan or line of credit. So all told, the fact that my house is now worth a lot more doesn’t benefit me in any way.

My property tax bill could go up

Property taxes are calculated by taking the assessed value of your home and multiplying it by your local tax rate. Now that my home is worth more money, my property tax bill could skyrocket unless my local tax rate goes down.

Now chances are, that rate will go down. A lot of homes in my area are up by $100,000 or more. And the tax rate in my town is high. But my township can’t easily get away with jacking everyone’s taxes up by $1,000 or more in the next year because it only needs a certain amount of money to meet its budgetary needs, so something is apt to give.

But all told, I’m pretty sure I’ll be looking at some sort of property tax hike next year — even if it’s not a huge one. And since I already pay a lot in taxes, that’s not ideal.

All told, a higher home value isn’t something I’m thrilled about. If I were looking to sell my home or borrow against its equity, I’d feel differently. But for now, all I really have is a higher number on a piece of paper — and the stress of a looming property tax hike hanging over my head.

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The warehouse club giant is making good on its pledge to offer customers great value. 

It’s hardly a secret that inflation has been hurting consumers since the latter part of 2021. And these days, pretty much everyone’s been racking up higher credit card bills in the course of feeding their families.

But some of the items you normally buy at the supermarket may not be costing more. Rather, it may be that their prices are holding steady, but you’re actually getting less product in return. It’s a concept known as shrinkflation, and it’s a sneaky tactic that causes consumers to lose money without even realizing it.

Let’s say you normally buy a 16-ounce box of pasta for $1.19. You might continue to see that pasta available for $1.19. But if you look at the box more closely, you may notice that you’re now only getting 12 or 14 ounces of pasta, not the 16 you originally got to enjoy.

Unfortunately, shrinkflation is pretty rampant these days. And the worst thing about it is that many consumers don’t even know they’re being taken advantage of.

But one retailer is bucking the shrinkflation trend. And budget-conscious consumers may want to spend their money there during these trying economic times.

Costco products aren’t shrinking

Costco is known for its bulk and large-sized products. But for the most part, Costco isn’t offering up smaller versions of its signature Kirkland products in an effort to trick consumers.

If you pay a visit to your local Costco, you’re likely to find that the giant muffins you enjoy are still, well, almost ridiculously large. And Costco’s Kirkland-branded snacks, chips, and pantry essentials will still keep you well-fed for weeks.

Now this isn’t to say that Costco hasn’t raised its prices since mid-2021. While prices vary by location, many consumers are seeing an increase in the cost of certain items.

But that’s less problematic than shrinkflation. The reason? It’s more obvious. And it puts consumers in a strong position to make informed decisions about their spending.

Someone who buys a 12-pack of Costco muffins every other week for $8.99 is apt to notice if the cost rises to $9.99. They’re less apt to notice if they’re getting fewer ounces of product. But at that point, someone in that boat can decide whether $9.99 fits into their grocery budget or not.

A shoppers’ favorite for a reason

Many people who maintain Costco memberships do so for years, and for good reason. The warehouse club giant prides itself on offering great value, and that means not pulling a fast one on customers by quietly reducing the size of its products.

Plus, Costco does a great job of standing behind its products. You can return almost anything you’re not satisfied with — even opened food. And for that reason, shopping there is really a pretty low-risk proposition, financially speaking.

If you’re on the fence about keeping your Costco membership in the face of rising costs due to inflation, consider the fact that your local warehouse club is probably one place where you won’t have to worry about shrinkflation. It’s hard to say the same thing about most grocery stores these days.

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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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Free items can be yours if you’re strategic about how you shop. 

Shopping for essentials like toothpaste and shampoo isn’t always a fun prospect — especially if there are other things you’d rather be putting on your credit cards than these boring personal care items.

The good news is, there are often deals to be had on this type of purchase if you know how to shop strategically. CVS is one place where you can find bargains and, in some cases, it may even be possible to get totally free items at the pharmacy. Here’s how.

Free stuff from CVS could potentially be yours

It’s possible to get totally free items at CVS because of the way the store operates its sales.

See, CVS allows you to use store coupons that it provides. If you join the company’s ExtraCare program, there are coupon centers in store that you can use to print deals you’re eligible for immediately. You just scan your ExtraCare card at the little in-store kiosk or enter your telephone number to get coupons printed out for you.

CVS also accepts manufacturers coupons on top of these in-store coupons. That means you can stack your coupons, using both the ones that the pharmacy provided as well as the ones the manufacturer offers.

In some cases, especially if items go on sale, stacking these coupons together can make products free or allow you to buy them for pennies on the dollar. For example, if a tube of toothpaste costs $2 and you get a $1 coupon from CVS and a $1 coupon for the toothpaste from the manufacturer, you end up paying absolutely nothing to buy it.

As if that wasn’t good enough, CVS also enables you to earn ExtraBucks for certain purchases. These are essentially “CVS currency” that you can spend on almost anything in the store. If you can buy an item that earns you ExtraBucks with a manufacturer coupon and a store coupon, you can sometimes end up actually getting paid to purchase it.

How to find the best CVS deals

Figuring out how to get the best bargains at CVS can sometimes be a challenge since you may not be aware of what coupons you can combine. The best option is to look carefully at the store flyer, look for sales, and then check to see what coupons are available from manufacturers. You can check the manufacturer website or there are sites online that sell coupons from the Sunday paper (which are often the best ones to combine with store deals).

There are also online websites, such as SlickDeals, which have forums dedicated to identifying the best drugstore deals each week. You can check out these forums to see what coupons and ExtraCare promotions you can combine to score free items.

If you can save money on purchases from CVS for personal care items ranging from toothpaste to toilet paper to razors, this can help you cut your grocery budget so you can use your cash for other goals. It’s well worth a little bit of effort in order to make that happen, so give this technique a try.

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The time to ask is before you commit. 

Falling in love is a hot mess. Simply spending time with someone we’re attracted to releases dopamine, the feel-good hormone. It’s followed by norepinephrine, a related hormone that tag teams with dopamine to make us extra giddy. And then there’s the way attraction leads to a reduction in serotonin, swamping us with “the feels.”

All those “feels” may help explain why we tend to throw reason out the window when we’re falling for someone. It feels too delicious to examine too deeply.

For example, we may fall in love with someone without knowing their views on religion or politics. We may also give our hearts to someone who deals with finances in a totally different manner than us.

Cold reality of science

According to science, after you’ve been in a relationship for about four years, those initial hormones diminish, replaced by other important hormones associated with attachment. These hormones are pretty nice too, but not nearly as blinding as the earlier ones.

Suddenly, the fact that they never pick their socks up is less adorably disorganized, and more maddeningly irritating. The fact that they’re cool with paying bills late is less bohemian and more irresponsible.

Given that money is one of the top things couples fight about, doesn’t it make sense to ask the important questions before allowing dopamine to make all the decisions? Before committing yourself to a relationship, here are six questions to ask.

1. How do you feel about debt?

This is a biggie because if your significant other is a fake-it-til-you-make-it kind of person who thinks living large is the way to convince the world they’re up and coming, you’re likely to face debt issues at some point.

2. How do you picture us splitting the bills?

Does your partner hope to merge finances and share everything or do they expect you to cover the lion’s share of bills? It may not matter much today, but when those hormones begin to mellow you’re going to wish you’d protected your own financial interests.

3. How important is it to you to save for the future?

If you’re a saver who joins forces with a spender, you can count on plenty of arguments when the savings account is empty and an emergency arises.

4. Do you think “stuff” equals success?

If you’re honest with yourself, you can probably already answer this question. Take a look at your significant other and consider how many toys and gadgets they surround themselves with. Do you find them bragging to others about what they have or how much they earn? If so, you’ll need to decide if you share their values.

5. What would you do if you lost all your money?

True character is revealed when everything goes south. As optimistic as you may be about your joint financial future, things can and do happen. People get sick, lose jobs, and weather bear markets. It’s important to discuss how you would deal with it if everything was lost.

6. Do you think financial decisions should be collaborative?

You immediately put yourself in a precarious position when you allow someone else to take total control of the finances. Research shows that financial abuse occurs in 99% of all domestic violence cases. That’s not to say your partner is suddenly going to become violent, but it does underscore the importance of maintaining your own financial autonomy. If your partner says something like, “Well, I’m the one who’s good with money so I’ll handle everything,” it’s a red flag.

True love is one of the great rewards of life, but that doesn’t mean we need to wear blinders. Before settling down, make sure you financially mesh with the person you’re building a life with. Doing so means money won’t be something you fight about.

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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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By making small changes to how you manage your finances, you may be able to boost your credit score. 

Maintaining a good credit score is ideal, but building credit takes time and effort. A good credit score can unlock better financial opportunities and make life less stressful. Developing certain habits can help you get there sooner. These practices could help boost your credit score as you work to set yourself up for financial success.

1. Pay more than the minimum amount due

When it comes time to pay your credit card bill, make sure you pay more than the minimum amount due. The smaller, minimum payment amount may look tempting — but it’s a trap. You’ll be charged interest on the unpaid debt if you don’t pay your entire credit card balance.

This extra cost can be expensive and adds up the longer you ignore it. Credit card debt is one of the most common forms of consumer debt and can cause financial stress and lead to further financial troubles. By paying your entire card balance, you can avoid expensive interest charges.

Doing this can help you stay on track with your financial obligations, so you don’t fall behind on important bills because of a lack of funds due to having to put more money toward interest. If you struggle to pay the entire card balance, consider reducing your credit card usage. That way, your total balance is manageable and fits your budget.

2. Keep your credit utilization low

If you use credit cards, you should pay attention to how much available credit you use each month. While you may have a high credit limit on your cards, spending anywhere near your maximum limit is not good practice. Why? Your credit utilization ratio, or how much of your available credit you use, makes up 30% of your credit score.

Maintaining a lower credit utilization ratio is advised. You can keep your credit utilization low by not using all available credit. Experts recommend keeping your credit utilization ratio below 30%. For example, if you have a $15,000 total credit limit between all of your credit cards, it’s in your best interest to keep your total charges below $4,500 each month.

3. Prioritize debt payoff before taking on new debt

Credit cards and loans are financial tools that can help you afford a new expense. But by taking on new debt, you could be putting yourself in a difficult financial situation. If you’re not cautious, the debt can add up quickly and get out of control.

Before taking on new debt, consider whether you can afford to do so. Of course, emergencies do happen, and unless you have a solid emergency fund set aside, you may have to explore financing options to cover important, unexpected costs.

But if you have existing debt and no emergency expenses have come your way, prioritizing debt payoff is the best move for your wallet. The sooner you tackle your existing debt, the quicker you can begin working to meet other important personal finance goals.

4. Set up payment reminder notifications (or enable autopay)

Forgetting to pay your bills can not only cause you added frustration but can negatively impact your credit. When you fail to pay your bills, or pay them late, you can expect to see negative marks on your credit report — which can harm your score.

One way to avoid missing payments is by setting up payment reminder notifications for all your bills. Another option is to enable autopay. By automating the payment process, you no longer need to worry about being forgetful. Keep in mind this option may not be a great fit for you if you tend to have minimal cash left in your checking account after all your bills are paid.

5. Don’t part ways with older credit accounts

A lengthy credit history is ideal because it shows creditors you have been managing your finances well for a significant amount of time. The age of your credit history makes up 15% of your FICO® Score. For this reason, keeping older credit accounts open is beneficial.

If you have older credit cards with no annual fees, don’t be in a rush to close the accounts. Instead, get into the habit of using your older cards occasionally, so the accounts remain active and can help you boost your credit score. If you have an older credit card with an annual fee, check with your card issuer to see if you can downgrade the account to a no annual fee credit card.

You can increase your credit score by changing your current behaviors and developing new habits. Small changes can add up over time to make a big difference. If you’re in the market for a new credit card, take a look at our list of the best credit cards to learn 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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There’s no other account that offers the same level of tax savings. 

There are certain expenses that tend to be burdensome at pretty much every stage of life. And healthcare is one of them. Whether you’re in your 30s or in your 70s, you never know when you might need money to cover a sudden medical bill.

In fact, medical costs are a common source of debt for Americans. And in extreme cases, they have the potential to drive consumers into bankruptcy.

That’s why it’s so important to have money set aside for healthcare costs — either in a regular savings account or a tax-advantaged account, like an HSA. But according to a recent survey by Principal, only 7% of respondents are planning to boost their HSA contributions in the new year. And that means many people are passing up a big opportunity. Here are three reasons why you should max out your HSA if you can.

1. You can enjoy a host of tax breaks

If you have money in a traditional IRA, you may be aware that your contributions are tax-free, but that your withdrawals are taxable in retirement. And if you’re saving in a Roth IRA, you may be aware that you’re getting the opposite benefit — no tax break on contributions, but tax-free withdrawals as a senior.

What makes HSAs so valuable is that they offer more tax breaks than any other account. HSA contributions are tax-free, investment gains in an HSA are tax-free, and withdrawals are tax-free as long as that money is used to cover qualified healthcare expenses.

2. You won’t have to scramble to cover medical bills

An unplanned visit to the emergency room could easily leave you on the hook for hundreds of dollars in bills. And if your health insurance plan comes with a costly deductible, you may have to come up with a lot of money for medical spending purposes.

The beauty of an HSA is that you won’t have to worry about where that money will come from. You can tap an HSA to cover everything from copays for medication to costs related to surgery.

3. You can set yourself up to worry less about healthcare during retirement

As much as healthcare costs can be substantial during young adulthood and middle age, they tend to rise even more so in retirement. That’s because health issues have a tendency to creep up as people age.

Also, it’s a big myth that retirees on Medicare don’t have to pay anything for healthcare. Medicare is far from free. Not only are there premiums and deductibles involved, but there’s also a range of out-of-pocket expenses, from copays to coinsurance.

Having a lot of money in an HSA could make it so that healthcare is less of a concern in retirement, financially speaking. And that could help you better enjoy your golden years.

Do your best to max out

Maxing out an HSA in 2023 means contributing $3,850 if you have self-only coverage and $7,750 for family coverage. If you’re 55 or older, you can add $1,000 to whichever limit applies to you.

Even if you can’t max out your HSA next year, you should still try to ramp up your contribution rate. Doing so could save you a lot of money in taxes while setting you up to cover whatever medical bills come your way.

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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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