Money Management

With credit cards, it pays to be mistake free. Learn about some of the most common credit card mistakes and how to avoid them. [[{“value”:”

Schools don’t usually teach about credit cards, so many of us learn as we go. And because no one’s a natural with credit cards, it’s normal to make mistakes here and there.

Unfortunately, these learning experiences can be expensive. That’s why you’re much better off learning about common credit card mistakes before they happen and before they can cost you any money.

1. Only paying the minimum

Every month, your credit card bill will have a statement balance, which is the balance at the end of the billing period. If you always pay the statement balance, you’ll never be charged interest. Your bill will also have a minimum payment amount.

Some people make minimum payments because it’s technically all you need to pay. But because credit cards require very small minimum payments, it takes an extremely long time to pay off debt this way.

Let’s say you have a $4,000 balance on a card with a 22% APR. That’s near the national average of 21.59%, according to the Federal Reserve. If you only make minimum payments, it will take 259 months (over 21.5 years) to pay off your card, and it will cost you $6,693 in interest.

You can see for yourself on your credit card statement. Card issuers include how long it will take to pay off your bill if you make minimum payments. In one of my statements, it literally says “if you make only the minimum payment each month, we estimate you will never pay off the balance shown on this statement.” That’s right — if I made minimum payments, I’d be making them forever.

2. Paying late

It’s important to pay your bills on time. If you miss your credit card payment, your card issuer can charge you with a late fee.

On a positive note, credit card late fees are on their way down. They’re going to be capped at $8, thanks to a new rule by the Consumer Financial Protection Bureau (CFPB). But there’s still no reason to pay your credit card company an extra $8.

Also, if your payment reaches 30 days past due, then your card issuer can officially report it as late on your credit history. This has a huge impact on your credit score — it could bring your score down by over 100 points.

The easiest way to avoid late payments is autopay. I’ve set up automatic payments for the statement balance on all my credit cards. I never have to worry about remembering my payments, and I also never pay any interest.

3. Spending more than you can afford

When you start out with credit, you may have a low credit limit. I remember that my first credit limit was $500. But if you pay your card on time every month, your credit score should improve, and you’ll qualify for higher credit limits.

Just because you’re approved for a certain credit limit doesn’t mean you should spend that much money. In fact, it’s probably better that you didn’t. If you use a large amount of your credit, it can lower your credit score.

Overspending also puts you at risk of credit card debt. With credit cards, many people fall into the trap of going for instant gratification. They buy what they want even if they don’t have a plan to pay it back. As a result, they end up paying extra in the form of interest.

It’s good to get into the habit of only making purchases you can afford to pay back immediately. If you don’t have the money for it, save up for it instead of putting it on credit.

4. Making cash advances

Many credit cards offer a cash advance feature. You can set up a PIN and use your credit card to get money at an ATM. There are just a few problems:

There’s a cash advance fee, normally 5%.Credit cards almost always charge a higher APR for cash advances.Your card issuer can charge interest on cash advances immediately. There’s no grace period like there is with purchases.

Although you may be able to get cash with your credit card, you’re better off avoiding this feature entirely.

It’s also worth mentioning that certain types of transactions can be considered cash advances, even if you didn’t withdraw cash. For example, if you wire money and pay for it with your credit card, that will almost certainly be treated as a cash advance. If you see a warning that your card issuer may treat a transaction as a cash advance, pay with your debit card instead.

5. Choosing a card that doesn’t fit your financial goals

There are several types of credit cards. Before you apply for a card, make sure it’s the right type of card for your current situation.

For example, if you want to earn rewards, you may start checking out cash back cards. These are a great choice if you’re looking for something easy to use. But if you travel all the time, you could be better off with a travel credit card.

Another way people sometimes go wrong here is focusing on rewards when they’ll need to pay off purchases over time. If you want to finance purchases, the best choice is a 0% intro APR card. This type of card has a 0% APR on new purchases for an introductory period. You’ll have time to pay off your purchases interest free, which will save you more money than earning rewards would.

All these mistakes are 100% avoidable. There’s no reason to beat yourself up if you’ve made any of them in the past — I’ve done so myself. But going forward, do your best to avoid them so your credit card doesn’t cost you any money.

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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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Houses are at near-record unaffordability. Read on to learn a few steps to help increase your chances of buying a home. [[{“value”:”

As if buying a house didn’t already feel unattainable already, a recent report from Redfin shows just how unaffordable housing is right now. The real estate company says that Americans need to earn $113,520 annually just to afford a median-priced home.

To put that into perspective, the typical household earns about $29,500 less than that each year. And if you’re wondering what a median-priced home costs in the U.S. right now, well, you’ll have to fork over $412,778 to get one.

While it can feel hopeless for many people looking to purchase a home, there are few things you can do to improve your financial situation. Here are a few suggestions.

1. Settle for less than your dream home

Many people don’t like the idea of compromising, but when you’re buying a house, it’s rare to get everything you want. With housing affordability at a near 40-year low, compromise is a necessity for most buyers.

Even if you plan on staying in your house longer than a few years, being willing to cut a few must-haves from your wishlist could help you find a cheaper home. This may mean living a little further outside of town than you wanted, having less land than you envisioned, or even buying a fixer-upper.

It’s worth considering that even when people think they’ve bought their dream house, many buyers, especially younger ones, end up selling it quickly anyway. Redfin data shows that 49% of homeowners under 35 sell their homes within three years.

2. Pay off debt

Mortgage lenders consider many different factors when deciding the size of your mortgage loan. Your income and debt are the two most important.

While you may be able to increase your income with a side hustle, using that extra income to eliminate some of your debt may be a better idea. Lenders typically want a debt-to-income (DTI) ratio below 43% for conventional loans, while FHA loans may allow you to have DTI up to 50%.

DTI is calculated by taking your monthly debt responsibilities (like car loans, credit card payments, personal loans, etc.) and dividing by your monthly income. For example, if your monthly debt payments total $2,000 and your monthly gross income is $6,000, then your DTI would be roughly 33%.

Paying off one credit card to eliminate a few hundred dollars in monthly payments could help you get approved for a higher loan amount.

3. Improve your credit score

Your credit score can have a significant impact on the size of the mortgage loan you’re approved for and the mortgage rate you receive. Credit scores range from 300 to 850 and the higher yours is, the better the rate you’ll be offered.

Let’s say you want to buy a $350,000 house, you’re putting 20% down, your credit score is 670 — which is in the “good” range but not the best — and you get an interest rate quote of 7.3%. Your monthly mortgage payment (principal and interest) would be $1,919 in this scenario.

But let’s say you have a credit score of 740, which is in the “very good” range. With this score, you may be able to get a mortgage rate of 6.9%, which would save you $75 per month.

RELATED: Mortgage Calculator

Making on-time payments accounts for 35% of your credit score, so paying bills on time is the best way to increase your credit score. Reducing your debt is the second-best to improve your score, considering 30% of the score comes from debt obligations.

Tip: I recently boosted my credit score by 28 points by using Experian Boost®. I linked my utility payments and a couple of other bills to my credit report in just two minutes. The service is free, and many people’s scores go up, with an average increase of 13 points.

Housing prices will likely remain high for a while, which means it’s more important than ever to devise a strategy for lowering your monthly costs. Rethinking your housing wishlist, paying off debt, and improving your credit score can all go a long way toward making a house purchase a reality for you, no matter what the market does.

Alert: our top-rated cash back card now has 0% intro APR until 2025

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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 Costco shopping app has robust tools that can help loyal Costco shoppers manage their memberships. Learn its top perks and how to use them. [[{“value”:”

Costco has never been a pioneer in digital and mobile technology. In fact, until a few years ago, its website was shockingly primitive, with little navigational help from the warehouse club that sells just about everything. Even today, it’s hard to get your bearings on Costco.com, especially if you’re new to the warehouse and don’t know what all it sells.

But lately, Costco has been revamping its shopping app. And users have generally been pleased. On the App Store, for example, the app has 4.8 out of 5 stars, while on Google Play it earns 4.7 stars. While the app is lacking some of the more potent features of its competitors’ apps — like the ability to scan items before checkout at Sam’s Club — here are five perks that loyal Costco members can take advantage of.

1. Look up old receipts

The Costco Shopping app stores all receipts purchased with your membership, including online and in-store orders. To find them, go to your “Account,” then navigate to “Orders and Purchases.” Once you’re there, you’ll see both online and in-warehouse receipts. While you don’t always need a receipt to return items to Costco, having them in one place could be useful for your budget, as well as for those times when you do need a receipt to return items.

2. Check Executive rewards

Executive members earn 2% cash back on their Costco purchases, which comes to them in the form of an annual rewards certificate. While you can always check your rewards balance by logging into your account on Costco.com, the Costco app will also tell you how much cash back you’ve earned. To find it, just click on “Account,” then navigate to the “2% Reward” tab under “My Wallet.” Costco even has a neat rewards gauge that shows you how close you’re getting to $1,000 in rewards (the maximum you can earn in a 12-month period).

3. Manage prescriptions

The Costco app gives you an easy way to refill prescriptions, as well as transfer them from one store location to another. You don’t even need to sign in to your account: You can use your prescription number and phone number to order prescriptions on the go. You can also look up drug prices, schedule vaccinations, and book appointments with virtual doctors and therapists.

4. Check gas prices

Hands down, Costco has some of the cheapest gas prices you’ll find. But if you have one or more Costco locations in your area, the Costco app can show you in advance which has the best gas prices near you. Just click on the “Warehouses” tab at the bottom of your screen and click on the location where you shop. Costco itself admits that the prices aren’t updated frequently, so it may not be accurate. But in my experience it’s never been more than a few pennies off.

5. Store your membership card

Forgot your membership card? Again? Don’t sweat it. The Costco app can store it for you. After you sign in to your Costco account and verify your identity, you can pull up your digital membership card whenever you want. The app will even let you add your Costco credit card, if you have one.

All in all, the Costco shopping app is slowly getting better. While it still lacks the robust features of other shopping apps, it can still help the average Costco shopper manage their membership. Give it a try and see if it can help you organize your next Costco shopping trip.

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.

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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.Suzanne Frey, an executive at Alphabet, is a member of The Motley Fool’s board of directors. The Motley Fool has positions in and recommends Alphabet and Costco Wholesale. The Motley Fool has a disclosure policy.

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Point of Sale (POS) systems have become commonplace. However, business owners don’t always use these unsung features. [[{“value”:”

Point of sale (POS) systems come in all shapes and sizes, each system with its own set of benefits. One thing is true of most POS systems, though: They’re designed to help you grow your business and allow you to use your time more efficiently. With so many different types of POS systems available and annual operating costs ranging from $3,000 to $50,000, it’s important to decide what you’re looking for before settling on one.

If you’re in the market for a new system, here are some of the lesser-known features that you’ll want to consider.

1. Above and beyond inventory management

Remember the old days when small business owners had to physically count inventory to know when it was time to reorder? POS systems track stock in real time, allowing you to quickly check where you stand on specific inventory. But today’s systems do so much more. Here are some of the surprising features some systems possess:

Predictive analytics that forecast future sales based on past sales.Automatic inventory reordering when current inventory reaches a specific threshold.Price adjustment suggestions based on supply and demand.

While some systems primarily focus on inventory management, others act as your wingman, helping you squeeze more profit from your business.

2. Black-and-white analytics

Some POS systems can offer in-depth analysis of everything from customer behavior to overall business performance. Once you have these insights in hand, it’s easier to make non-emotional, data-driven business decisions. You’ll be able to identify growth opportunities and make changes in areas that aren’t quite up to snuff before they end up costing you money.

3. An eye on the customer

Some POS systems track customer behavior directly from the POS system. This feature can assist you by:

Providing you with the purchasing habits and preferences of existing customers.Giving you the ability to personalize marketing efforts to better meet the needs of existing customers.Allowing you and your staff to immediately access customer information, which in turn allows you to provide more personalized service.Enabling you to accept all kinds of payments, including cash, credit card, and mobile wallet.

4. Seamless e-commerce integration

Does your business have an online presence that customers order goods and services from? If so, you may be interested in the way some POS software neatly integrates online with offline sales. Here’s how you can benefit from seamless e-commerce integration:

You can rest easy, knowing that inventory tracking is taking place across all sales channels.It’s simpler to ensure that pricing and promotions are the same across all platforms.You don’t have to spend your time toggling between online and offline sales, since they’re all contained in one report.

5. Simplifies management responsibilities

If your current method of employee scheduling is to sit down with a calendar and a pen, some POS systems will take the task over for you. Here are some of the other ways managing employees can be made slightly less stressful:

By allowing you to track employee performance through the system.By providing a rundown of the number of hours worked by each employee.By giving you the tools you need to create and manage employee schedules directly through the system, reducing the time you normally spend on scheduling issues.Some systems even act as a sort of accounting software to handle payroll by calculating wages based on the number of hours logged in the system.

Much of what you do as a business owner can’t be quantified in black and white. After all, it’s difficult to measure your dreams for the business or how customers feel when they interact with you. However, a good POS system can free up enough of your time to allow you to focus on the intangible aspects of your enterprise, and ideally save even more of the money your business earns.

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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 right bank account could make you money, but too many fees could cost you more than you earn. Here are five fees to watch out for. [[{“value”:”

Most people keep their money in banks because they want to grow their wealth over time. This is certainly possible, especially with the best savings account and certificate of deposit (CD) rates hanging around 5.00% right now.

But interest rates are just one part of the equation. You also have to consider how much you’re paying in bank fees. Here are five bank fees that could really eat into your profits if you’re not careful.

1. Maintenance fees

Maintenance fees on bank accounts are less common than they used to be, thanks to the rise of online banks. But there are still accounts that charge customers just for owning them. These are more common with traditional banks. Many give customers an opportunity to waive this fee by making a certain number of monthly deposits, for example, or maintaining a certain minimum balance. But if you can’t do this, you could lose as much as $30 per month to this fee.

You can avoid this by choosing an account that doesn’t have a maintenance fee in the first place. Or if you really like an account but it has a maintenance fee, make sure you’re confident you’ll be able to waive it before choosing to work with the bank.

2. Early withdrawal fees on CDs

CDs offer high interest rates on your funds and lock in that rate for the entire CD term. This could be anywhere from months to years. You’re technically free to take your cash out at any time, but you could face early withdrawal penalties for moving cash out before the CD term ends.

This is pretty easy to avoid, though. Only invest funds you don’t plan to spend before the CD term is up. Or open a high-yield savings account instead, if you prefer having access to your cash at any time.

3. Paper statement fees

Yes, some banks still send paper statements to your mailbox. But doing so requires more time and money than just sending you an eStatement. So a lot of institutions pass this cost along to customers in the form of a paper statement fee.

This is usually only a few dollars per month, but it’s easy to avoid. You usually just have to contact your bank to request electronic statements. You can do this by phone or possibly through your online account.

4. Wire transfer fees

Wire transfers aren’t something most people do all that often. But if you plan to move money around this way, it’s important to check your bank’s fee schedule so you know what to expect. It’s common for banks to charge for outgoing wire transfers, while most offer free incoming wire transfers. But there are some institutions that charge for both.

You may be able to avoid these fees by moving your money another way. Perhaps you could send a check or do an electronic funds transfer instead.

5. ATM withdrawal fees

You should be able to make fee-free withdrawals and deposit cash at ATMs in your bank’s network. These are located at the institution’s branches. It may also have a partnership with a nationwide ATM network, like Allpoint.

Out-of-network ATM usage typically results in fees from the ATM owner, but your bank may charge you an extra fee for this as well. You can avoid these fees by sticking to ATMs in your bank’s network. You can find these using your bank’s ATM locator tool on its website or in its mobile app. Alternatively, you can look for a bank that reimburses for out-of-network ATM fees

This isn’t an exhaustive list of bank fees you could run into. For a complete overview, check your bank account’s fee schedule or reach out to your bank for details.

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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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To some, credit cards are like potato chips: You can’t have just one. But can you really have 20 — or more? Here’s the answer. [[{“value”:”

In the U.S., only about half of people have two or more credit cards, and a measly 13% of people have five credit cards or more. I’m part of that statistic. Me, with my 20-odd cards — spread across three wallets — from roughly a dozen issuers, across all four card networks.

Look, I know — it sounds like a lot. It is a lot of cards. But it’s absolutely true. And you know what else? My credit score looks great. (Well, it looked better for the new mortgage loan, but I digress.)

Yes, you can have 20 cards (and more!)

There is no legal limit to how many credit cards a person can obtain. You can have as many credit lines as the banks and credit unions are willing to give you.

And as long as you use those cards responsibly — by paying on time every month and keeping your balances low — credit card issuers are willing to give you quite a few.

Most issuers have in-house caps

All this isn’t to say that you can have unlimited credit. Each financial institution has its own ceiling on how much money it is willing to lend you. (Because that’s what credit cards are: lines of credit, i.e. debt.)

This cap will generally apply to your total credit lines across all of your cards with that issuer. For example, if Chase is only willing to give you $10,000 in total credit, and you already have two Chase cards with $5,000 limits, you’ll likely be rejected for a third card.

Similarly, most issuers have caps on how many credit lines you can have with them at one time. American Express, for instance, is said to cap your total number of credit cards to five. (Charge cards are reportedly exempt from this limit.)

The downside is that issuers don’t generally tell you about these limits. So you may not realize you’re at your credit line or card cap until you bump your head on it (metaphorically).

That many cards is hard to keep organized

For the folks who wonder how someone keeps track of 20-plus cards — well, let me tell you, it takes work. Personally, I couldn’t do it without my spreadsheets.

It helps that a lot of my cards don’t get much regular use. More than half of my collection is made up of travel rewards cards, including cobranded hotel and airline cards. These typically only come out when I’m planning travel that includes the associated brand.

I also diligently log into all of my online banking accounts at least once a week to check due dates, scan transactions for signs of fraud, and check offer portals for useful deals. My mobile banking apps make this super easy to do while I’m cooking dinner or waiting on a persistently late family member.

Pay on time, or the credit score gets it

If you’re the type of person who forgets due dates, then the multi-card lifestyle probably isn’t for you. Even one missed payment can do bad things to your credit score, and missing multiple payments while juggling too many cards could lead to catastrophic credit damage.

One thing that can help the on-time-challenged is to set up autopay. This automatically makes at least your minimum payment (you can set the payment amount) before your due date so you won’t have to worry about late fees or credit damage.

The other important thing is to never charge more than you can afford to repay quickly. Ideally, you want to pay off your balances in full every month. The only exception is when you have an active 0% APR offer. In that case, make at least your minimum payment every month, but be sure to pay the full balance off before the offer expires.

They spawn like rabbits

If you’re thinking of starting the credit card rewards game by picking up a second, third, or even 19th card, be warned: These things multiply. One day you’re just grabbing an airline card to make your next trip cheaper. The next thing you know, you have three wallets and a career writing about credit card rewards.

It’s a slippery slope, folks. Tread carefully.

Alert: our top-rated cash back card 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 lengthy 0% intro APR period, 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.American Express is an advertising partner of The Ascent, a Motley Fool company. JPMorgan Chase is an advertising partner of The Ascent, a Motley Fool company. Brittney Myers has positions in American Express. The Motley Fool has positions in and recommends JPMorgan Chase. The Motley Fool has a disclosure policy.

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