Money Management

Costco is full of surprises, even for first-time home buyers. Check out what it can offer you. [[{“value”:”

Being a first-time home buyer is an absolute minefield. There’s so much you don’t know that you don’t know yet, and so many different things you’re going to need help with as a homeowner, that it can be pretty overwhelming. Your real estate agent will have your back for as much as they can, but they can’t do everything for you.

Amazingly, for a lot of the help you’ll need getting your first home up and running, there’s Costco. Yes, you read that right.

Here are a few surprising ways that Costco can help first-time home buyers navigate the buying process, that tricky first year, and beyond.

1. Costco offers discounts on homeowners insurance

Unless you’re buying a home in California or Florida, your Costco membership can do way more than just get you discounts on pies the diameter of a basketball. You can also save on homeowners insurance through Costco’s relationship with American Family Insurance.

According to its website, 89% of Costco members who choose CONNECT, powered by American Family Insurance, homeowners policies are highly satisfied with the product, giving it a rating of four or five on a five-point scale in a 2022 internal survey.

Buying homeowners insurance can be a real drag, and although it’s a good idea to price more than one insurer, choosing the dream team of Costco and AmFam to cover your first home is one more task you can check off your long pre-closing to-do list.

2. Need a moving truck? Costco’s got that covered

I am incredibly embarrassed to learn that I threw money away on moving truck rentals in the past. I don’t move often, but when I do, I like to not spend any more than necessary, given just how much moving can cost. According to Angi, renting a 22′ long moving truck can cost $40 to $130 per day, not including packing materials, insurance, mileage fees, or the gas you’ll need to top the truck off before taking it back.

Costco apparently has considered all of this and partnered with Budget to secure up to 26′ trucks for members at a discount of 25% off of retail rates, including the rental fee and mileage fee. That also includes 24/7 roadside assistance in case your rented truck develops a mechanical issue.

3. Finding contractors can be hard, but Costco makes it easy

You may not be ready to dive right into dumping a ton of money into your new house right away, but when you are, Costco has contractors to help with a range of home improvement projects. Although they can’t do everything, Costco’s partners have a range of offerings, from installing garage doors and openers to remodeling bathrooms and even installing solar panels.

Even if you’re not looking for any big changes to your home, Costco can help with hanging window treatments, organizing your closets, and installing water purification systems. Members earn 10% to 15% back in the form of a Costco Shop Card for qualifying purchases.

RELATED: Best Credit Cards for Costco

Plan on taking advantage of Costco discounts for your first home

When I think of Costco, I don’t think of saving money on insurance, truck rentals, or home services, but who does? You will need a pretty detailed budget to make it through your first home purchase and that big move into your first house — and Costco is there to help.

RELATED: The #1 Strategy for Saving Money at Costco

Don’t forget while you’re there that the Costco hot dog is one of the most affordable meals on this Earth, and you might as well grab a Costco pizza to go for later. You’re going to need to eat to keep up your strength for the sheer marathon that is to come.

Top credit card to use at Costco (and everywhere else!)

If you’re shopping with a debit card, you could be missing out on hundreds or even thousands of dollars each year. These versatile credit cards offer huge rewards everywhere, including Costco, and are rated the best cards of 2024 by our experts because they offer hefty sign-up bonuses and outstanding cash rewards. Plus, you’ll save on credit card interest because all of these recommendations include a competitive 0% interest period.

Click here to read our expert recommendations for free!

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.JPMorgan Chase is an advertising partner of The Ascent, a Motley Fool company. Kristi Waterworth has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Costco Wholesale and JPMorgan Chase. The Motley Fool has a disclosure policy.

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Why settle for a 5% return on your money when you can do way better? Read on to learn more. [[{“value”:”

Because CD rates are still sitting at 5.00%, a lot of people I know are rushing to open them. And I can see why.

A 5% return is a pretty sweet deal considering you’re really taking no risk. As long as you bank somewhere that’s FDIC insured and limit your deposit to $250,000 or less, you can sit back and collect your interest without the stress that tends to come with investing in the stock market.

But while a 5% return on your money might seem like a great deal, you could do worlds better with stocks. So if you’re saving for a long-term goal, stocks are probably a much better option for you.

Why limit yourself to 5%?

A number of banks today are offering 5.00% APYs on CDs for a 12-month term. This means that if you have $10,000 to put into a CD, you can earn $500 worth of interest in a year without having to break a sweat.

And to be clear, a CD is a great bet if you’re saving for a goal that’s about a year out, like buying a new car or splurging on your dream vacation. But if you’re saving for a goal that’s many years away, like college or retirement, then stocks could do a lot more good for you.

Over the past 50 years, the stock market has averaged an annual 10% return, as measured by the performance of the S&P 500 index. That’s twice the return on a 12-month CD today.

But also, remember that today’s CD rates aren’t the norm, and that today’s rates may not be available once 2024 comes to an end. With a stock portfolio, on the other hand, you might earn an average annual 10% return over the next 30 or 40 years.

And if you’re curious as to how much of a difference that might make, let’s imagine you’re able to deposit $10,000 into CDs and earn a 5% return on your money for the next 30 years. It’s unlikely, because rates are likely to fall, but we’ll go with it.

In that case, you’re looking at turning your $10,000 into about $43,200. But if you load up on stocks and invest that $10,000 at a 10% return over the next 30 years, you could end up with around $174,500 to your name. That’s a difference of $131,300.

How to invest in stocks when you don’t know how to invest at all

I’m hoping I’ve convinced you to go all-in on stocks instead of CDs if you’re saving for a milestone that’s many years into the future. But what if you have no idea how to put together a stock portfolio?

The good news is that that’s not a problem. And no, I don’t recommend picking random stocks out of a hat. I recommend loading a portfolio with S&P 500 ETFs, or exchange-traded funds. This way, you’re basically investing in the 500 largest publicly traded companies today without having to do much research or buy shares of each company individually.

Remember, the 10% return I keep referring to above is based on the S&P 500’s performance over the past half-century. So it’s an index worth putting your money into.

Getting a 5.00% APY on a CD might read like an awesome deal. And in the context of CDs, that’s an excellent rate. But trust me when I say you can do better. And if you want to grow your money more efficiently over a long period of time, then investing is really the way to go.

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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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Saving an emergency fund sounds hard, but there are techniques to make it easier. Read on to begin your savings journey now. [[{“value”:”

An emergency fund is more than just a financial buffer — it’s peace of mind. In life’s unpredictable whirlwind, from sudden medical emergencies to unexpected car breakdowns or even job loss, an emergency fund acts as your financial lifeline.

Experts typically recommend setting aside three to six months’ worth of living expenses, but even starting with a smaller amount can provide significant security. Here’s how you can proactively and efficiently build up your emergency savings, ensuring you’re prepared for whatever comes your way.

1. Create a budget with a built-in savings goal

Begin with a detailed budget that includes a line item for your emergency fund. First, analyze your income and regular expenses to understand how much you can realistically set aside each month. Then, treat your emergency fund contribution like a recurring expense.

For instance, if your take-home pay is $4,000 a month and you spend $3,000 on monthly expenses, plan to save $200 to $300 of the remaining amount for emergencies. This approach ensures your emergency savings grow steadily without disrupting your usual personal finance commitments.

2. Automate your savings

One of the easiest ways to ensure you consistently contribute to your emergency fund is by automating your savings. Set up a direct transfer from your checking account to a savings account dedicated to emergencies. Schedule these transfers to line up with your payday so the money is out of sight and out of mind before you have a chance to spend it.

Even starting small helps. For instance, saving just $50 every two weeks adds up to $1,300 over a year. If you can gradually increase the amount as you get more comfortable, you’ll accelerate your savings even more.

3. Cut unnecessary expenses

Take a close look at your monthly spending and identify areas where you can cut back. Common culprits for unnecessary spending include dining out, subscriptions you rarely use, and high-cost entertainment. Even reducing your spending in these areas by $100 a month can free up $1,200 a year that could go into your emergency fund.

Moreover, consider temporarily cutting back on some non-essential expenses until your emergency fund reaches a comfortable level. If you examine your monthly subscriptions — like streaming platforms, gym memberships, or magazine subscriptions — you might find you’re spending $50 or more per month. Canceling one or two of these could save you around $600 annually, which can substantially contribute to your emergency savings.

You might also consider opting to delay upgrading your smartphone, which can save you hundreds of dollars upfront. If you typically upgrade every year and the new model costs about $800, postponing this purchase could redirect a significant amount of money into your emergency fund, fortifying your financial safety net.

4. Redirect windfalls and tax refunds

Whenever you receive unexpected windfalls, such as tax refunds, holiday bonuses, or gifts, resist the urge to splurge. Allocating these amounts to your emergency fund can significantly speed up your savings timeline.

For example, the average tax refund in the U.S. is around $2,500. If you put even half of this into your emergency fund annually, you’d add $1,250 to your savings without impacting your daily budget.

5. Earn extra income

If your current budget doesn’t leave much room for saving, consider ways to increase your income. Side hustles can be a great option, whether it’s freelance work, part-time jobs, or selling items you no longer need. If you can make an extra $200 a month by tutoring, selling crafts, or doing freelance work, you’ll have an additional $2,400 at the end of the year for your emergency fund.

You could also invest time in upskilling through online courses or certifications, potentially leading to a higher salary or better job opportunities. This not only provides more immediate funds for your emergency stash, but also enhances your financial stability in the long run.

Building an emergency fund might seem daunting, but by approaching it with a clear plan and using smart strategies, you can accelerate the process. Creating a budget with a savings goal, automating savings, cutting unnecessary costs, using extra money wisely, and boosting your income are all effective steps that can help you build financial resilience. Remember, the peace of mind that comes from having a financial cushion is invaluable, and every small step you take helps.

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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 no position in any of the stocks mentioned. The Motley Fool has a disclosure policy.

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Yes, babies are expensive. Here are three expenses that might catch you by surprise when you have your first kid. [[{“value”:”

When my daughter Tavia was born last September, I knew she would add to our monthly budget. Various outlets have put the figure differently, but according to The Motley Fool Ascent’s research, it can cost roughly $310,605 to raise a kid from zero to 17 years. That’s about $18,270 per year, or an extra $1,522 monthly. Where we live (Portland, Oregon) that’s a conservative number, as daycare can cost more than $2,100 monthly for an infant.

Now, we were (mostly) prepared for the conventional costs: diapers (cheaper at Costco), clothes, doctor’s appointments, baby wipes. But since Tavia was our first, several necessary expenses blindsided us. Like these three.

1. Water bill

Our water and sewage bills both increased more than 30% after we had Tavia. Some of this usage comes from bath time, which we do twice weekly. But most of it derives from other water-intensive activities that we hadn’t planned for, like washing bottles and laundering cloth diapers. At this point, we do a load of laundry every other day — not cheap, especially in the summer.

Although you have to use water, you could get creative to mitigate high bills. For instance, you can take showers at your gym or wash bottles at your daycare. You could buy a small baby tub to avoid filling up the entire bathtub and steer clear of high water-usage hours like mornings and evenings. Finally, you could also pay your water bills with a credit card that earns extra rewards for utilities, so long as your water company doesn’t charge a processing fee.

2. “Nursery” medical bill

This one was very shocking. And, from what I can gather, I’m not the first parent to have experienced the notorious “nursery” charge on their hospital bill.

First, some context. Before we had Tavia, we enrolled in hospital indemnity insurance, which is supplementary coverage that helps you pay for hospital stays. Since Oregon has one of the highest inpatient hospital stay costs in the country, we knew we needed help to cover the bill. Fortunately, our insurance company paid for a large portion of my wife’s hospital stay — even more than what we were expecting. I think we even opened a bottle of Prosecco to celebrate the day we got the check.

But we were naive. Or, rather, ignorant. A couple of months after getting my wife’s hospital bill, we got a second hospital bill — this one for Tavia. The hospital charged us $2,175 for our baby’s stay, which was designated “Nursery charge.” Not only that, but my wife’s lactation consultations were also charged under Tavia’s name. All in all, after Tavia’s insurance kicked in, we’re still on the hook for more than $2,600.

Now that we’ve gotten the bill, it makes sense to me. Tavia is a human being, so of course they would charge her to stay at the hospital. But because we didn’t budget properly for it, we’re reaching into our emergency fund to cover the surprise cost.

3. Toys

Me before we had Tavia: “Toys make kids materialistic; we’re not going to buy them.”

Me after Tavia: “Toys foster imagination!”

Really though — we didn’t expect to buy many toys. We had a few items on our baby gift registry — like a piano that plays a few tunes, keys on a ring, some expandable tubes — but not many. After Tavia showed intense interest in toys at a friend’s house, however, we gave in to buying her some. Although we try to buy toys where we earn the most credit card rewards, the cost does add up.

That said, if you live in a warm weather climate, or have your baby in the spring or summer, taking them outside can be just as stimulating as toys, if not more. Tavia loves the outdoors, especially touching grass and seeing waterfalls. But since we had Tavia in Portland’s other season (rain), her toys helped her (or rather us) get through the gray season. They’re not a necessary expense, but we’re happy to spend a little extra just to watch her play and learn new things.

I could add other expenses to this list, like food, doctor’s visits, and medicine. Likewise, I’m sure parents with 1- or 2-years olds are thinking, “Oh, just wait, it gets more expensive than this.” All in all, if you’re expecting your first, building an emergency fund now can cover you later. You might think you’re ably prepared, but with all the surprises babies bring, it’s prudent to have a plan B.

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

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First-time home buyers can save big on essentials from furniture to appliances at Costco. Here are a few great deals. [[{“value”:”

When you’re stepping into the exciting realm of homeownership for the first time, the list of needs (and wants) for your new space can seem endless — and intimidatingly expensive. But what if I told you that outfitting your first home could be both fun and friendly to your personal finances?

Welcome to the world of Costco, where bulk doesn’t just apply to toilet paper and trail mix. For first-time home buyers, Costco offers an array of incredible deals that can help stretch your budget further without sacrificing quality or style. So, grab your Costco card (or maybe it’s time to join!), and let’s dive into some of the best deals that can make your home sweet home even sweeter.

Mattress

A good night’s sleep is key to enjoying your first home. And the Casper Cooling Select 12″ Memory Foam Mattress might be exactly what you need to turn your new bedroom into a haven of rest and relaxation. With prices ranging from $439.99 to $689.99, and a generous discount of $110 to $160, it’s a perfect fit for any first-time homeowner looking to invest wisely.

This mattress features a cooling knit cover and a sophisticated four-layer foam construction, including breathable foam layers and pressure-relieving memory foam, all tailored to support and align your body throughout the night. As a first-time homeowner, you’ll appreciate not only the comfort and support it provides, but also the peace of mind that you saved some cash on the purchase.

Refrigerator

As a first-time homeowner, one of your most significant investments will be a dependable refrigerator. At Costco, you can find the Samsung 29 cu. ft. Smart 4-Door Flex Refrigerator with Family Hub and Beverage Center for just $2,499.99. Plus, when you spend $1,999 or more on qualifying items, you’ll enjoy an extra $300 off. This is a fantastic bargain, especially when compared to Best Buy’s price of $3,199.

Not only are you getting a top-of-the-line refrigerator equipped with smart features to streamline your kitchen experience, but you’re also capitalizing on major savings. If you use the Costco credit card to pick up this fridge, the deal sweetens with additional cash back rewards, making it an incredibly savvy purchase for your new home and budget.

Sofa and dining table

As you furnish your first home, don’t miss the opportunity to create comfortable and inviting spaces with great deals from Costco. Take for instance the Henredon Murphy Fabric Modular Sectional with Ottoman. Originally listed at $1,999.99, it’s now available for just $1,599.99 after a $400 discount. This sofa offers versatile seating options and includes an ottoman for extra comfort, making it a fantastic centerpiece for your living room.

For your dining area, consider the Thomasville Anacortes 9-Piece Dining Table Set. Priced at just $999.99 after a substantial $550 discount, this set is crafted from FSC-certified Rubberwood with Ash Veneers and includes a removable 18″ leaf for flexible dining options. The chairs are finished with beige fabric upholstered seats and back panels, blending comfort with durability.

And when you purchase these two items together through Costco Direct, you’ll receive an additional $100 off, enhancing the value and making your first home setup even more affordable. Whether you’re hosting a dinner party or enjoying a quiet evening at home, these pieces combine style, functionality, and savings.

Other membership perks

The advantages of a Costco membership are particularly valuable for first-time homeowners looking to make smart, secure investments in their new home. The membership perks, such as extended warranties and exceptional customer service, are designed to make your significant home-related purchases feel both secure and satisfying.

Furthermore, with the Executive membership, you benefit from an annual 2% reward, which allows you to earn up to $1,000 back on eligible purchases at Costco and Costco Travel. This can be especially beneficial as you stock up on essentials and furnishings.

Smart shopping tips

Keep these tips in mind as you stock up on items for your new home at Costco:

Plan ahead: Before you go, list what you need to prevent impulse buys. Costco’s vast selection can be overwhelming, so a plan can help you stay focused and on budget.Look for seasonal sales: Keep an eye on seasonal changes and promotions. Items like outdoor furniture and holiday decor can be deeply discounted during off-peak times.Check price tags: Learn to read Costco’s price tags for extra savings. Prices ending in .97 indicate a markdown, while an asterisk on the price tag means the item won’t be restocked.

Shopping at Costco for your new home can be an adventure in savings and quality. With thoughtful planning and an eye for deals, you can deck out your first home in style and comfort, all while keeping your budget healthy and happy. Welcome to the joy of homeownership — Costco style!

Top credit card to use at Costco (and everywhere else!)

If you’re shopping with a debit card, you could be missing out on hundreds or even thousands of dollars each year. These versatile credit cards offer huge rewards everywhere, including Costco, and are rated the best cards of 2024 by our experts because they offer hefty sign-up bonuses and outstanding cash rewards. Plus, you’ll save on credit card interest because all of these recommendations include a competitive 0% interest period.

Click here to read our expert recommendations for free!

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 Best Buy and Costco Wholesale. The Motley Fool has a disclosure policy.

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Working hard to build your emergency fund? You’ll likely want to save more than $1,000. Find out why you may need more than $1,000 in your emergency fund. [[{“value”:”

Establishing an emergency fund is an excellent money move. Having extra cash saved for unexpected expenses can reduce stress and make you feel more confident about your finances. But how much money should you save? Is $1,000 enough?

Probably not. Even if you need to slowly build your fund over many months or years, setting a savings goal higher than $1,000 is a good idea. I’ll explain why.

Make sure you can cover your housing expenses

The reason $1,000 probably isn’t enough money saved for your emergency fund is that your monthly housing costs alone are likely well above $1,000. If you experience a significant life change, like job loss or a medical emergency, you don’t want to be without a home because you can’t make your rent or mortgage payments.

Data compiled by Rent.com found that the national median price of an apartment in March 2024 was $1,987. What about people with mortgages? According to data from the Mortgage Bankers Association, the average mortgage payment in March 2024 was $2,201. This data examined recent mortgages, so home buyers who purchased their homes in earlier years may pay less.

If your rent or mortgage payment is below $1,000, that’s fantastic news. But can you also cover your utility bills and other necessary expenses if you’re without income for a month or more?

Setting aside enough money to cover all your housing costs is a must. You’ll likely want to save enough to continue paying your bills for several months — not just one month.

Ask yourself: How much money is enough to cover my expenses?

Unsure how much money to keep in your emergency fund? Consider the cost of your everyday expenses to determine how much emergency savings you need. Sure, some costs can be eliminated — like your Netflix subscription. But you’ll still need to pay your rent and utility bills. Other necessary expenses, like insurance, should continue to be paid as well.

Here’s how to calculate your savings goal: First, add up the cost of your monthly bills. Then, determine how many months you want to save up for and multiply the total by that number.

We have a tool for you if you need help calculating your emergency savings goal. The Ascent’s emergency fund calculator makes it easy to determine your savings amount. Our calculator takes your total expenses and shows you how much money you need to save to cover six months of your living expenses.

Don’t wait to save — it’s OK to start small

Are you feeling discouraged about where your emergency fund stands today? Remember: Any money saved is a win. Most people can’t save thousands of dollars within a few weeks or months. You’re still making fantastic progress if you can only afford to set aside $25, $50, or $100 monthly. Having some emergency savings is better than having none.

If you’re saving, don’t miss out on the chance to earn interest. We recommend keeping your extra money in a high-yield savings account. You’ll earn interest while your cash sits in the bank. Any interest earned will get you closer to your savings goals.

Alert: highest cash back card we’ve seen now has 0% intro APR until 2025

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.Natasha Gabrielle has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Netflix. The Motley Fool has a disclosure policy.

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