Money Management

Perfect credit isn’t easy to come by. Read on to see how many consumers have it, and whether you should be pushing yourself to attain it. [[{“value”:”

The higher your credit score, the more likely you are to get approved for new loans or credit cards. And if you have perfect credit, you’re even more likely than the average consumer to have success in these areas.

A perfect FICO® Score is one that’s reached 850. And as of 2023, 1.54% of consumers had one, says Experian, one of the three credit bureaus.

What this tells us is that most consumers do not have perfect credit. You should also know that while perfect credit is achievable, it’s not easy to get.

The good news, though, is that you don’t actually need perfect credit. But that doesn’t mean you shouldn’t work to boost your score.

Why perfect credit isn’t worth stressing about

It’s hard to achieve perfect credit because sometimes, even innocent moves on your part could result in a minor drop to your score. For example, when you apply for a credit card or mortgage, the simple act of putting in an application results in a hard inquiry on your credit report. And each hard inquiry can knock a few points off of your score, putting that perfect 850 out of reach.

But one thing you should know is that there’s no need to push for a perfect credit score if yours is in great shape already. Experian says that any credit score of 800 or above is considered exceptional.

So if you have a credit score of 825, there’s no sense in stressing yourself out to raise it. With a score that high, you’re likely to get approved for whatever credit card or loan you want unless there’s another specific reason for you to be denied (in the case of a mortgage, for example, you may be turned down because your income isn’t high enough).

How to boost your credit score

While you shouldn’t worry at all if your credit score is at 800 or above but not quite at 850, it does pay to work on boosting a credit score that’s lower — especially a score of 739 or lower. Experian defines a very good credit score as one that’s between 740 and 799. And it’s good to get your score to that level (and ideally, work your way up to exceptional over time).

You should focus on a few key things when trying to boost your credit score. First, aim to pay all bills on time, since your payment history carries more weight than any other factor when calculating your credit score.

Second, aim to keep your credit card balances low, as the less of your available credit you use at once, the better it is for your score. Finally, aim to check your credit report every few months for errors, since a mistake could drag your credit score down.

You’re entitled to a free copy of your credit report every week from each reporting bureau — Experian, Equifax, and TransUnion. This doesn’t mean you have to make checking your credit a weekly thing. But it’s good to review your credit report on a quarterly basis in case mistakes pop up that are likely to drag your credit score down (for example, a late payment listing that isn’t accurate).

There’s a reason the overwhelming majority of U.S. consumers don’t have perfect credit. Don’t sweat it if you’re not part of the 1.54% with an 850 credit score as long as your score is in excellent shape. And if not, you can always work on raising it over time.

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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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The Federal Reserve is expected to gradually lower interest rates for the next couple of years. Learn what it could mean for your savings account. [[{“value”:”

The Federal Reserve is widely expected to start lowering benchmark interest rates at its September meeting, and to continue reducing them at least through 2025. According to the latest data, the median expectation priced into the financial markets is for a total of 2.25 percentage points of rate cuts in the federal funds rate between now and next September. The voting members of the Federal Reserve also expect rates to steadily decline through at least 2026.

Savings accounts — especially those offered by online banks — are paying some of their most competitive interest rates in years. It wasn’t long ago that it was difficult to find an online savings account that paid more than 1.00% APY, but in the current environment, yields of 4.50%, 5.00%, or even higher are readily available.

However, one of the biggest drawbacks to savings accounts is that their interest rates can change at any time, with little notice. So, here’s what to expect from your savings account if the Fed lowers rates as expected through 2025.

What would Fed rate cuts mean for savings account interest rates?

To understand how the Fed’s rate cuts could affect your savings account interest rate, there are a few important principles to keep in mind.

The Fed’s rate moves don’t directly impact savings account interest rates in most cases. This is why even though the federal funds rate has increased by more than 5 percentage points since the beginning of 2022, many branch-based savings accounts still pay interest rates in the 0.01%-0.10% ballpark. There is no rule that says a bank must raise or lower interest rates in accordance with what the Fed does.

The interest rates paid by the top online banks tend to track the federal funds rate rather closely. It isn’t a coincidence that the current federal funds rate target range is 5.25%-5.50% and the highest-paying savings account on our radar has a 5.31% APY as of this writing. It isn’t a perfect relationship, but if the Fed lowered rates by a full percentage point, I would expect banks offering the top online savings accounts to lower their rates by a similar amount.

Finally, interest rates on high-yield savings accounts can change without notice. If the Fed lowers rates, you can be reasonably certain that high-yield savings account rates will fall very soon after.

The point is that if the Federal Reserve lowers the federal funds rate by 2.25 percentage points as the financial markets seem to expect, I expect the highest-yielding online savings accounts to offer interest rates in the 3.00% range. If you have money in savings, the interest payments you receive could start to get significantly smaller.

The bottom line

One big takeaway is that we don’t actually know a whole lot about what savings account interest rates will be in 2025. We can use the best information available to make predictions, but it’s important to realize that there’s no way to know for sure what the Federal Reserve will do — especially when we’re talking about a timeframe of over a year.

Having said that, the most likely direction for savings account interest rates between now and the end of 2025 is lower. If you’re worried about income, and there is a portion of your savings that you’re unlikely to need anytime soon, it could be a smart idea to shift some of your money into certificates of deposit, or CDs, to lock in today’s elevated interest rates while you still can.

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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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Are you afraid that age 18 is too young for your first credit card? Check out a few reasons why age 18 is the perfect time to apply for one. [[{“value”:”

If you (or the adults in your life) feel like age 18 is too young to get a credit card, you’re not alone. Credit cards can be risky, especially for young people who don’t know how they work.

Some people run up too much credit card debt, which they can struggle to pay off. Having too much credit card debt can even lead to declaring bankruptcy, which can make it harder to get approved for auto loans or mortgages for several years into the future.

But here are a few good things about credit cards:

They can help you build credit history and increase your FICO® Score.They can offer travel rewards, cash back, and other useful perks.They give you a convenient way to pay for the purchases you need now, with a flexible way to manage your month-to-month cash flow.

I personally will encourage my children to get their first credit cards at age 18. Here are a few reasons why age 18 is not too soon for a credit card.

1. Getting your first credit card helps you build credit

Having a good credit score is a huge advantage in life. If you can start at a young age with opening your first credit card and establishing credit history, this can help you save thousands of dollars on borrowing costs for the rest of your life.

If you can manage your credit card responsibly without making late payments or racking up credit card debt, your credit card usage will become part of your credit report.

The on-time payments you make today with your credit card at age 18 can help you qualify for lower-interest loans down the road when you’re ready to apply for an auto loan or buy a house. Your future self will thank you!

2. The best credit cards offer rewards

Many 18-year-olds don’t have much money in the bank. Especially if you’re a college student, you’re probably not earning much income, even if you have a part-time job. That means every dollar counts.

Some of the best credit cards for students can help you earn valuable credit card rewards, like a percentage of cash back on everyday purchases like gas and groceries, or travel reward points that you can use to book cheap flights and free hotels.

You’re already spending money everyday on restaurants, groceries, ride-hailing apps, and more. Why not get some money back or get fun extra rewards? Some credit cards are specially designed for the spending patterns and lifestyles of young people — and you don’t need to have perfect credit to apply.

3. Credit cards can be risky, but financial education can help

Sometimes young people get in over their heads with too much credit card debt. They don’t understand how credit card interest (APR) works, or they don’t keep track of the due dates for their credit card bills, and they get into financial trouble.

But this doesn’t have to happen to you! Just the fact that you’re reading this article shows that you’re interested in financial literacy and you’re trying to learn about how to use credit cards the right way. If you avoid spending too much on your credit cards, and if you pay off the balance in full each month, you will not get into credit card debt.

Instead, you’ll build up a positive credit history with a track record of paying bills on time. This makes it easier for you to qualify for lower-interest loans in the future, when you want to make bigger purchases like a car or a home, or even apply for premium rewards credit cards that require higher FICO® Scores.

Don’t treat credit cards like something to be afraid of or intimidated by. Instead, view them as an opportunity to build credit and improve your personal finances for the rest of your life.

Bottom line

If you’re 18, credit cards don’t have to be something to be afraid of. Talk with your parents or guardians about how you plan to use the card responsibly. Make sure you understand what happens if you don’t pay your credit card bill on time or if you carry a balance that can turn into high-interest credit card debt.

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This credit card is not just good – it’s so exceptional that our experts use it personally. It features a 0% intro APR for 15 months, a cash back rate of up to 5%, and all somehow for no annual fee!

Click here to 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 recommends Flow. The Motley Fool has a disclosure policy.

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Moving isn’t cheap — especially if you’re moving a long distance. Read on for one moving expert’s top tips to save. [[{“value”:”

Moving is no one’s idea of a good time — and I should know. I just moved for the 36th time in my life. But this time, my move was into the house I just bought, so I’m hoping to stay for a while.

True to form, this last move wasn’t an insignificant expense for my budget — but thankfully, I was only moving a distance of less than one mile. According to data from Angi, the cost of a cross-country move could range from $2,401 to $6,890, with an average cost of $4,577. There are a ton of factors involved, though, including the exact distance and the moving method you’re using.

Whether you’re moving to the next state over or to a whole new time zone, here are a few ways to save money on the process.

Use the right credit cards

First and foremost, having the right credit cards to lean on during a move can help you earn cash back or other rewards on a big expense. If you put $5,000 worth of moving expenses on a credit card that earns a flat 2% cash back rate, you’ll get a cool $100 back.

If you’ll be staying in hotels on your way to your new home, a travel credit card could pay you a higher bonus rate for booking such a stay — or if you have accumulated points already, you may be able to use them to cover your room. A gas credit card could pay you a nice rate on those gas fill-ups for a massive moving truck.

And no matter what kind of credit card you use, you may be entitled to purchase protections that could give you peace of mind if something goes wrong with the new appliance you bought for your new home and the seller is unwilling or unable to help.

Consider all your options — and prices

Don’t assume that renting a giant U-Haul truck and loading, driving, and unloading it yourself is your only way of moving long distance. You have so many options. You could load a car trailer or pack your belongings and ship them in boxes with a carrier like UPS. Or you could use a storage cube (PODS is perhaps the best-known name in the business) for your move.

If you go the latter route, I recommend calling around for price estimates from different companies. I used one of these services (ABF U-Pack) to move items from my East Coast home state to the Great Plains state I lived in for a few years, and it cost me around $2,000 — half of what PODS had quoted me.

That said, calling around for prices for any kind of move is always a good idea. Yes, U-Haul is the classic moving truck purveyor, but if you’re a Costco member, you can get a deal on a Budget truck rental — 25% off.

Declutter

Once you know you need to move, start decluttering. Get rid of all the junk you know you won’t need after you move — because you’re not using it now. In fact, if you haven’t even unpacked it from the last time you moved, what are the odds you’ll miss it if you get rid of it?

Decluttering isn’t much fun — it’ll take up a good chunk of time ahead of your move, and you’ll have to find time to run to the dump or drop items off at your local Goodwill. But imagine paying less for your long-distance move because you now own less stuff. It’s a good feeling — trust me.

Pack yourself

Yes, you can hire full-service moving crews who will not only load, drive, and unload a truck for you, but will also box up your worldly possessions. But this is expensive. Angi estimates that adding packing services to a move can cost an extra $1,000.

I don’t know about you, but personally, I prefer packing my own stuff and knowing which box the towels are in (surely this goes without saying, but labeling your boxes well is always a good idea). Plus, that $1,000 will be available for other expenses — like a sweet new couch.

Ask about financial help

Finally, if you’re moving at the behest of a new employer (as I have done so many times in my life), it’s worth asking if there’s any financial assistance available. I moved for jobs with history museums, and in one case, the entirety of my moving costs (renting a big truck and driving 1,000 miles) was covered.

In two other cases,my employers were able to contribute $500 toward the effort, which covered the cost of a 12 foot moving trailer attached to the back of my partner’s SUV for moves of more than 1,000 miles apiece. In short — you should ask if there’s any help to be had, because you may be surprised.

A long-distance move can be exciting and exhausting at the same time. No matter the reason you’re moving, there are ways to save money in the process. Lean on my tested tips to give yourself a chance at a smaller budget hit.

Alert: highest cash back card we’ve seen now has 0% intro APR until nearly 2026

This credit card is not just good – it’s so exceptional that our experts use it personally. It features a 0% intro APR for 15 months, a cash back rate of up to 5%, and all somehow for no annual fee!

Click here to 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 positions in and recommends Costco Wholesale. The Motley Fool has a disclosure policy.

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