Money Management

The more you spend on credit card interest, the less money you have for other expenses and goals. Read on for ways to spend less on interest this year. [[{“value”:”

Credit card companies don’t allow consumers to carry a balance out of the goodness of their hearts. Rather, they allow consumers to make just their minimum monthly payments in exchange for collecting interest.

Over time, though, the interest you pay your credit card companies could amount to a lot of money. And the more you spend on interest, the less money you’ll have at your disposal for paying bills and meeting your personal financial goals, whether it’s saving for retirement or a house. If you’re eager to spend less money on credit card interest in 2024, here are a few options to consider.

1. Pay off your debt sooner

The longer you carry a balance on a credit card, the more it’s going to cost you in interest. So if you’re able to cut back on spending for a period of time or take on a side hustle to drum up more cash, you might save yourself a world of money.

Let’s say you owe $5,000 on your credit cards and you think you need another year to pay off that balance in full. If you’re looking at a 24% interest rate, that has you spending $674 on interest all in. If you can cut your repayment window in half by slashing spending temporarily and/or working a second job, you’ll reduce your interest costs to $356.

You can use this credit card interest calculator to see how much money on interest you can save by shortening your repayment window.

2. Do a balance transfer

A big reason you can end up spending a lot of money on credit card interest is that the rates many cards charge are quite high. The nice thing about a balance transfer is that you can often move your balances over to a single card with a 0% introductory rate. That gives you a break from racking up interest while you work to chip away at your balances.

Let’s say you owe $5,000 at present but you move that sum over to a new card with 0% interest for 15 months. If you’re able to pay about $333 a month on the card between reduced spending and working a side gig, you could have that $5,000 balance paid off by the time your introductory period comes to an end, thereby sparing yourself from earning further interest on that sum.

3. Consolidate into a personal loan

A personal loan won’t give you a period of 0% interest. But what it will give you, generally speaking, is a lower interest rate on your debt than what your credit cards are charging you.

Let’s say you owe $5,000 on credit cards and you’re able to consolidate that into a fixed-rate personal loan at 9% interest. If you’re able to pay that loan off in a year (say, by using the tactics mentioned above, like getting a side hustle), you’ll reduce your interest costs to $247.

It’s a shame to lose money on credit card interest, because the amount you spend in that regard could do a lot of good for you otherwise. So take these steps to save yourself money on credit card interest — and enjoy the benefits of having more cash at your disposal.

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.The Motley Fool has a disclosure policy.

“}]] Read More 

Relying on a shoebox of receipts isn’t going to work. Read on to learn three steps to get your small business accounting on the right footing. [[{“value”:”

Managing expenses, paying taxes, staying on top of payroll, and the overall money management required to run many small businesses will likely take more time and effort than many business owners want.

But the good news is that there are many products and services out there that make small business accounting easier than ever. If you’re just starting your small business, here are three basic accounting principles you should know and some suggestions for managing your accounting needs.

1. You’ll need a small business bank account

The most important first step for small business accounting is to open a small business bank account. It’s crucial to keep your personal accounts separate from your business accounts for taxes, expenses, and income.

A business bank account will also help keep your personal assets from being caught up in certain tax audits, bankruptcy, or lawsuits if any of those circumstances pop up with your business.

Importantly, a business bank account can also help when you apply for a business loan or business credit card by clearly showing your business’s expenses and revenue.

How to do it: Look for a bank that offers the services you want, which may include checking and savings accounts and a business credit card. Some business bank accounts will charge fees up to $15 to $25 per month, and others may have transaction fees. Some online business accounts may have lower fees, but do the research to ensure they provide the level of customer service you want.

2. Expense tracking is crucial

When starting your business, expense tracking may not seem like a big deal. How hard could it be, right?

But imagine you have employees buying supplies for your business while you and your managers use the business credit card to restock inventory. Meanwhile, payroll is due every two weeks, the rent is due each month, and unexpected expenses must be covered to keep your business running.

The point here is that there are too many expenses to track in your head. You can manage them easily while trying to run other aspects of your business. Fortunately, business expense tracking software can keep it all straight for you.

How to do it: Managing your business expenses involves finding the right software for your business. The best way to do this is to look at The Ascent’s comparison of the best small business expense software and find the one that offers the services you need at the price you want to pay. The software should include a mobile up for uploading receipts, the ability to integrate credit card transactions, and the ability to set expense policy rules in the software.

3. Choose the right accounting software

Finally, one of the most essential things your small business needs to know about accounting is, unsurprisingly, to find the right accounting software.

Good accounting software will help you manage your finances by tracking invoices, paying bills, budgeting, and overall money management. This means you’ll be able to zoom out and see your total revenue and expenses over the past few quarters, view projected tax liabilities, and generate financial reports about your business.

It’s worth mentioning here that many small businesses wrongly assume they don’t need accounting software. The temptation is to do it yourself using a spreadsheet, but there are many great accounting programs out there. Some of them are priced at just $10 per month, so there’s really no excuse for avoiding accounting software.

How to do it: Find the best accounting software for your small business by considering how it will help you manage invoicing, billing, and budgeting. You’ll want to find software that easily integrates with your bank and e-commerce accounts (if you have them) and helps you manage your tax liabilities.

Separating your personal and business bank accounts, tracking expenses, and using the right accounting software will go a long way toward helping you manage your small business. The earlier you start using all three, the easier it will be to manage your money and ensure that your small business is financially healthy.

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.The Motley Fool has a disclosure policy.

“}]] Read More 

Vacations are expensive. Read on to find out how credit card perks can make them cheaper. [[{“value”:”

Traveling with your spouse can be an exciting adventure, but the cost of travel, hotels, and eating out can quickly add up. So how can you keep costs low while still booking a fantastic adventure? Tap into the benefits of travel credit cards.

Here’s how rewards cards can improve your next vacation with your spouse, and a few tips for finding the best travel rewards cards for each situation.

1. Book a business class ticket to Europe

Business class tickets often offer a better flying experience, with larger seats, better meals, airport lounge access, and priority boarding. When traveling internationally, some of these perks can help you feel more rested when you arrive at your destination.

The downside is that business class tickets are expensive, with many costing several thousand dollars. But if you have a travel rewards card, you can significantly cut costs or even book a ticket for your spouse for next to nothing.

How to do it: Some business class tickets to Europe range from 80,000 to 140,000 in points. Meanwhile, the bonus points for some airline rewards cards range from 25,000 to 80,000, some of which could cover the cost of one European business class ticket if you combine the bonus points with other points you earn throughout the year.

If you’re considering using points from a new card, just make sure you find one with significant bonus point earnings and check for any potential ticket restrictions. Most cards require you to spend a certain minimum amount, like $4,000, within a given time frame, before you receive the bonus points.

2. Extend your vacation with free hotel stays

Hotel expenses are the second-largest vacation cost after airline tickets, and recent research from Budget Your Travel shows that the average hotel stay costs $259 per night, and vacation rentals (like Airbnbs) cost about $314 per night.

Fancy hotels can push those costs even higher, potentially making a weeklong vacation out of reach for many people’s budgets. This is where a hotel rewards card can come in handy. Many of the best ones include free nights at the hotel.

How to do it: Look for a hotel rewards card that gives you at least one free night per year; some even offer two nights. You may also want to look for a card that gives you several bonus nights as part of its welcome offer. For example, some cards give you several free hotel nights after your first $3,000 in purchases in a given time frame after opening the card.

3. Treat your spouse to an elevated dining experience

The average cost for two people eating three meals per day (including alcohol) on a three-day vacation is about $510, according to Budget Your Trip. Using a travel and restaurant credit card helps you cover the cost of an expensive dinner without worrying about pinching pennies while you’re celebrating.

When my wife and I celebrated our anniversary this past year, we booked a nice dinner in Charleston, South Carolina, complete with candlelight and champagne. I used my credit card to earn 2% cash back on the evening’s dinner, but there are travel and restaurant credit cards that will take the savings one step further.

How to do it: Some cards offer 3X points for every dollar spent on restaurants and 2X points for all travel expenses. Many also have welcome offers for thousands in redeemable points or cash back welcome offers if you spend a certain amount within the first few months. Be aware that some cards charge an annual fee, so look for a card with no annual fee if you don’t think you’ll use it enough to make the cost worth it

No matter what type of benefits you’re looking for, you’ll likely find a travel rewards card that fits your needs. Using a credit card to earn special rewards for tickets, hotels, or restaurants could help you and your spouse enjoy an adventurous vacation — without breaking the bank.

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.The Motley Fool has a disclosure policy.

“}]] Read More