Money Management

There are many ways $5,000 can improve your finances. Read on to find out some of the best places to put it right now. [[{“value”:”

Having extra cash is always a luxury, especially now as inflation remains stubbornly high. But knowing what to do with that money creates its own challenges.

Let’s look at five smart money moves you can make with $5,000 right now, and a few examples of when you might want to choose one option over another.

1. Invest in the stock market

The historical annual rate of return of the S&P 500 is just over 10%. There’s no guarantee that your investment will earn those returns in any given year, but even with its volatility, investing in the stock market is still one of the best ways to build long-term wealth.

For example, assume you took your $5,000 and opened a brokerage account to buy a low-cost index fund that tracks the S&P 500. If you earned the historic rate of return of just over 10% over 10 years, your $5,000 could become $12,968.

When to do it: Because of the stock market’s volatility, you shouldn’t invest money you need to cover regular bills or might need in an emergency. Instead, invest any extra money you can afford to leave in the market for at least several years and, ideally, much longer.

2. Open a savings account

Many high-yield savings accounts pay 5.00% interest or higher right now, making them a fantastic place for extra cash. For example, if you deposit your $5,000 in a high-yield savings account paying 5.00% interest, you could earn $250 in one year with virtually no risk.

The one downside is that savings account yields are variable. Banks can change the yield rate at any time, which could negatively impact how much you earn. Still, the best high-yield savings accounts are FDIC insured, making them a safe place to earn extra money.

When to do it: Savings accounts are best for emergency funds or for saving up for significant expenses, like a down payment on a house. If you need a place to store a sum of cash that you don’t need for immediate expenses (but still want easy access to), put the money into a savings account.

3. Open a certificate of deposit (CD)

Another smart money move is to open a high-yield CD. Like savings accounts, some CD rates are above 5.00% right now, and you can find one that has a term length you’re comfortable with.

For example, there are 1-year CDs that pay 5.00%, meaning that if you leave your money in the CD for the entire 12 months, you’ll earn 5.00% interest on your investment. That would give you $250 from your $5,000 in just one year.

When to do it: Unlike savings accounts, the yield rate is guaranteed over the CD term length, as long as you leave your money in the CD for the entire term. If you take your money out early, you’ll have to pay a penalty. So, only put money in a CD you’re willing to part with for the entire term length.

4. Pay off credit card debt

The average American household has about $7,950 in credit card debt. This means that many Americans could benefit from paying $5,000 toward their balances.

For example, let’s assume you have $5,000 in credit card debt with the current average APR of 24.6% and pay $250 toward the amount every month. In this scenario, it’ll take 26 months to pay off, and you’ll have spent $1,500 in interest payments! In contrast, adding $5,000 to your credit card balance would immediately eliminate that debt and save you from those interest payments.

When to do it: There’s no wrong time to put large sums of money towards your credit card debt. Most cards have variable high-interest APRs, so paying your balance off as soon as possible is one of the best ways to improve your financial picture.

5. Open a money market account

Money market accounts are a blend of a savings account and a checking account, giving you the potential to earn a high annual percentage yield (APY) while still having easy access to your money via check-writing capability or a debit card.

With a money market account, you can earn yields of around 4.00% to 5.00% right now. While you have access to your funds, you can’t take it out more often than the agreed-upon schedule, usually six times per month.

When to do it: Money market accounts are best for short-term savings, in which you want to earn interest but still want some access to your money. Some money market accounts may even offer promotional bonuses if you deposit a certain amount and leave it deposited for a designated amount of time.

Where you decide to put your $5,000 depends on your financial situation. I recently put a significant sum of money from freelance projects toward paying off credit card debt. That was best for me, but someone else would benefit more from investing that money. The important thing is to evaluate your financial situation and determine the best option for you.

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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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Avoid overspending on food by shopping at low-cost retailers like Aldi. The grocer will offer additional discounts on hundreds of select items. Learn more. [[{“value”:”

A trip to the grocery store can quickly deplete your checking account funds. But shopping at a low-cost grocer like Aldi can help you get the essentials without ignoring your budget. The popular retailer recently announced additional summer savings that shoppers can take advantage of through Labor Day. Aldi has marked down prices for over 250 summer essentials to help consumers save more money. Find out more about these extra deals.

Maximize your savings by shopping at Aldi this summer

Aldi is a low-cost retailer known for its affordable grocery prices. But shoppers can save even more money this summer by buying select seasonal items with extra price reductions. In a recent press release, the retailer noted that these markdowns will save consumers $100 million.

Aldi has lowered prices for select food items so you can stock up on your favorite summer must-haves without overspending beyond your means. Most markdowns will be available through Labor Day, but a few select items will only be marked down through July 10, 2024.

Consumers should review Aldi’s current sales fliers and pay attention to additional discounts outlined in-store to stretch their dollars further. For those working with a limited grocery budget this summer, these extra savings can help.

Get a bigger discount on these Aldi buys

The retailer has lowered prices for over 250 popular seasonal items. Buying these items can be a win for your wallet. While not an exhaustive list, here’s an overview of some price reductions you can expect when shopping at your local Aldi this summer:

Other ways to get the most out of your money when shopping

Shopping at retailers like Aldi can make it easier to stay on budget. But there are other ways to make sure you get the most from your grocery money. Here are some suggestions:

Bring a shopping list: If you’re forgetful, a list can ensure you get what you need before leaving the store, as well as avoid impulse purchases. Try drafting a shopping list before your next grocery run to help yourself stay on track as you shop.

Use a credit card that earns rewards: Consider paying for your groceries with a credit card.

Using one of the best cash back credit cards can allow you to earn cash back rewards. Of course, you should only spend what you can afford to avoid expensive credit card debt.

Earn rewards with cash back apps: Another way to get rewarded when you shop is to use one of the best cash back apps. Mobile apps like Ibotta can earn extra cash. Verify whether your favorite retailers participate in these programs.

Are you looking for additional money guidance? Check out our personal finance resources.

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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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Can’t decide what to get at Costco this week? Check out this writer’s five personal favorites at his local warehouse. [[{“value”:”

With all its variety, Costco can feel like a zoo — or a jungle if we count the parking lot. That’s probably why seasoned members always go to Costco with a well-defined list, lest they want to leave with a cartload of stuff they weren’t expecting to put on a credit card. And while I definitely like trying new products at Costco, I certainly have my own favorites that I always return to. Like the following five.

1. Kirkland Signature Italian basil pesto

Price: $9.49

Kirkland basil pesto is rich and creamy, without being too heavy or too salty. Although I can name other brands that sell higher quality pesto, for the price the Kirkland Signature brand checks off two important boxes: cost and taste. We use it to make sandwiches and for pasta dishes that have a pesto sauce as the base.

2. Kirkland Signature Italian extra virgin olive oil

Price: $25.99

If you can’t tell, we cook a lot of Mediterranean food. So we always stock up on olive oil when we’re at Costco. My go-to is the Kirkland Signature Italian Olive Oil, which costs about $13 per liter. Though not the cheapest olive oil you can find, it’s worth paying slightly more for a better-tasting oil. For a cheaper alternative, you could buy the Organic Extra Virgin olive oil, which costs about $11 per liter.

3. Kirkland Signature diapers

Price: $34.99 – $44.99

According to BabyCenter, parents spend about $70 to $80 on disposable diapers each month, which comes out to about an average of $0.29 per diaper. Since many parents also go through about 2,500 to 3,000 diapers a year, saving even a penny per diaper could result in $25 to $30 in annual savings on this expense alone.

Fortunately, Costco can help parents save more than a penny per diaper. In fact, if you get Kirkland Signature diapers, you could save up to $0.11 per diaper, depending on the size you need. For example, a 192-count box of Kirkland Signature Diapers Sizes 1 – 2 costs $34.99, which comes out to $0.18 per diaper.

4. think! protein bars

Costco sells a lot of protein products, like bars and powders, at low prices. But its price for think! bars is the lowest I’ve seen. At one point, it sold an 18-count box of think! protein bars online for $24.49, or roughly $1.36 per bar. Meanwhile, on Amazon, you can buy a 30-count box for $51.24, or roughly $1.71 per bar. In this case, Costco would save you $0.35 per bar, which adds up to $10.50 per month if you eat one a day.

5. Tires

Finally, it’s hard to beat Costco’s overall price on tires and installation. While the retail price for tires isn’t always the lowest, Costco frequently runs promotions that make its prices competitive with discount tire shops. What’s more, tire installation at Costco is free. Considering that other tire shops charge $80 or more to install four tires, this often makes Costco the cheapest place to find tires, even when its prices are on par with other places.

All in all, Costco provides my household with many other staples, like eggs, trash bags, paper towels, and toilet paper. Next time you’re at Costco, take a look at some of my favorites, and see if they can help you streamline your budget.

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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.John Mackey, former CEO of Whole Foods Market, an Amazon subsidiary, is a member of The Motley Fool’s board of directors. The Motley Fool has positions in and recommends Amazon and Costco Wholesale. The Motley Fool has a disclosure policy.

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Weekend side hustles can be a great way to earn cash. Read on to find out why they don’t always need to be profitable. [[{“value”:”

Side hustles can be a great way to make extra cash and they’ve become popular with workers as inflation has ballooned, with an estimated 54% of Americans having one.

But there are lots of other reasons why you might want to spend some of your extra time working on a side project, aside from improving your cash flow. Here are five little-known perks of weekend side hustles and a few suggestions for getting started.

1. Creative outlet

Before I became a freelance writer, I blogged as a creative outlet. Since my day job didn’t offer many writing opportunities, I’d get up early, go to a coffee shop, and spend an hour writing.

My blog never took off, but that didn’t matter much to me. I was more interested in spending a little time every week doing something I really enjoyed. I was more satisfied in my day job as a result and it was well worth the effort to have a creative distraction.

Why do it: Recent research shows that 46% of Americans use creative activities to relieve stress and anxiety. Everyone’s creative outlet will be different. I have friends who’ve created online games and children’s books. The point is to find something you enjoy doing without the added stress of trying to make money from it.

2. Upskilling

While some people start side hustles by tapping into skills they already have, you can also start a side hustle to build new skills.

Adding a new skill to your resume could be a huge asset. Gallup data shows that workers who upskill earned about 8.6% more income than they did before learning new skills.

How to do it: There are lots of great platforms for learning new skills, including MasterClass and Skillshare. You can also try your hand at the new skill by setting up a gig on Fiverr or Upwork and charging a small fee as you build up your new skillset.

3. To help you get a new job

Maybe you want to start a weekend side hustle just for fun, and you learn some valuable skills. Once you’re proficient, you can list those skills on your resume, potentially helping you get a new job.

Many employers also like to see that potential employees are able to learn new skills and want to take on new challenges. Creating a weekend side hustle on your own time signals to employers you want to do more than the bare minimum.

How to do it: If you want a side hustle to help you get a new job, you may want to spend some time looking at jobs on LinkedIn and what skills are listed in the descriptions. Find something you’re interested in pursuing and then match it up with potential job opportunities.

4. Networking

Working on a side hustle can make it easier to network with people who share your interests. It can also put you in touch with clients who know other people doing the work you’re doing.

When I first started freelance writing, I reached out to editors and shared my experience and interests with them, to make connections and find work. Not all the networking was fruitful, but some of it was and I found that many people were more than willing to connect.

How to do it: Don’t be afraid to reach out. Connect with people in your industry on LinkedIn or other social media platforms. You’d be surprised how many people are willing to connect if you request to do so in a respectful and pleasant way.

5. Trying out a different career before jumping into it

I have a friend who’s always been interested in technology and started teaching himself how to code years ago. He spent time on the weekends learning new programming languages and fiddled with tech projects just for fun.

As he became more unhappy with his day job, he realized he might be able to turn his hobby into a career. Fast forward several years, and he’s now working as a programmer for a Fortune 500 company.

How to do it: Not every weekend side project will turn into a new career, but you never know where it might lead. If you already have some experience with your side hustle business, consider creating an online course to share your knowledge.

No matter what your reason for starting a weekend side hustle is, remember that doing so can be far more beneficial than just helping to improve your monthly budget. Find something you enjoy doing just for the sake of doing it. If it leads to earning additional income, then great. But if not, you’ll still have put your time into something valuable for yourself.

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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 a disclosure policy.

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