Money Management

Some house-related problems are deal-breakers in my book. Read on to learn about the issues I wouldn’t willingly take on. [[{“value”:”

When you buy a home, you take on more than just a monthly mortgage payment. You also have to deal with peripheral expenses like property taxes, homeowners insurance, and upkeep. These are all expenses homeowners know to prepare for. But one additional expense that might really throw your finances off-course is the cost of making repairs.

When you buy a home, needing to make repairs at some point is pretty much inevitable. But some can be expensive beyond belief. That’s why in the course of buying, it’s pretty important to have your home undergo a thorough inspection. And you should attend that inspection so you can ask questions if issues are pointed out.

Now, it’s not unusual for a home inspector to find minor issues during their examination. But if I were to discover these three issues during a home inspection, I’d immediately back out of the deal (which you can do as long as your contract has a home inspection contingency) and look elsewhere.

1. Foundation damage

A cracked foundation is a problem because, well, your foundation anchors your whole house. And the reason I wouldn’t buy a home with foundation damage is that the cost to address it could be exorbitant.

Angi puts the average cost of foundation repairs at about $5,000. But it also notes that the cost could reach $15,000 on the high end. And I happen to know someone who recently spent over $20,000 on foundation work after buying a home.

Because it can be so hard to estimate the cost of addressing this particular issue, it isn’t one I’d knowingly take on. It’s one thing if you find out you’re buying a home with a failing air conditioning system and it’ll cost $7,000 to $8,000 to replace it. That’s a more narrow range. But I wouldn’t take on a repair where it’s hard to estimate the final cost until you start the work, which is often the case with a damaged foundation.

2. Outdated electrical work

Rewiring a house is a big deal. And because of that, I wouldn’t be willing to buy a home that wasn’t already up to code.

Angi puts the cost of upgrading wiring at $200 to $2,300. It also says that the cost to upgrade a circuit breaker box costs $1,150 on average, while upgrading electrical outlets costs about $2,000.

But in reality, the cost of fixing outdated electrical work may be much higher. In addition to these costs, you might have to pay to fix the walls you inevitably have to break up to access your wiring in the first place. And you also have to then think about repainting them.

Plus, frankly, I would not feel comfortable living in a home even for a short period of time that wasn’t up to code. It’s a scary, hazardous situation that would definitely keep me up at night.

3. A termite problem

Much of the time, when you buy a home, you’re going to have to deal with a pest control issue at some point. A few years back, we had to pay a few hundred dollars to address an invasion of mice (thankfully, we think we found the source and blocked it off). And these days, I pay about $500 a year to have my home sprayed for ants every few months.

But one issue I would not be willing to deal with when buying a home is a termite problem. Termites can cause a world of damage, and like foundation repair, the cost to address the problem can vary substantially.

Angi puts the average cost of termite repair at $3,000 but acknowledges that the range of the cost to fix the problem starts as low as $250 and goes as high as $37,500. And the latter is a lot of money. Plus, you then have to take steps to prevent future termite damage once you’ve addressed the initial damage.

Always have savings when you’re buying a home

Whether you’re buying your first home or your fifth, there are certain issues you may want to write off as deal-breakers from the start. And you may want to consider putting the above items on your list to avoid a huge financial hassle.

That said, it’s super important to have a fully loaded emergency fund as a homeowner, because you never know what issue might arise out of the blue. Remember, your home inspection gives you a snapshot of the condition of your home at that moment in time. A year or two later, things could go very wrong.

So always have cash reserves as a homeowner, and also, do yourself a favor and factor the cost of minor repairs into your monthly budget. That way, you won’t have to pull from your savings account every time there’s a small issue, leaving you with more money in the bank to tackle the really big ones.

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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.Discover Financial Services is an advertising partner of The Ascent, a Motley Fool company. Maurie Backman has no position in any of the stocks mentioned. The Motley Fool recommends Discover Financial Services. The Motley Fool has a disclosure policy.

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We all make mistakes with our business. Here are some common money errors to avoid. [[{“value”:”

Building a business isn’t easy, and few of us get it right all the time. The best we can do is try to learn from others and avoid their mistakes. Here are a few common financial mistakes small business owners tend to make.

1. Not tracking business expenses

There are two important reasons you need to keep track of your business expenses. The first is simply knowing where your money is going. It’s impossible to properly plan for your expenses without knowing what they actually are.

You’ll also need to keep track of business expenses for tax purposes. There are a ton of business-related expenses that can be deducted from your federal and state taxes.

It may be tempting to base your deductions on estimates, especially if there are a lot of eligible transactions. But if you happen to be audited, you could be in a lot of trouble if you can’t substantiate each claim with appropriate documentation, like receipts.

A lot of accounting software programs will let you track expenses. Many will even let you connect a credit card and bank account so you can import expenses automatically. Of course, you can also stick with the old-school tried-and-true method of color-coded spreadsheets. (Or, like me, you can do both!)

2. Skipping your estimated tax payments

Federal and state governments expect you to pay taxes on your income as you earn it. For regular employees, taxes are paid every paycheck through regular withholding.

Even if you don’t receive an employer-provided paycheck, however, you’re still expected to pay taxes on your income throughout the year. As a small business owner, you do this by making quarterly estimated tax payments.

Quarterly payments are due four times a year:

April 15: Estimated tax payment for January through MarchJune 15: Estimated tax payment for April and MaySept. 15: Estimated tax payment for June through AugustJan. 15: Estimated tax payment for September through December

Failing to pay your estimated taxes on time can result in penalties when you finally file your annual taxes. The amount of the penalty can vary, but they can be quite severe if you underpay by a significant amount.

3. Having no business emergency savings

I recommend to everyone to keep at least a few months’ worth of expenses saved up in an emergency fund. This fund can get you through lean times or, well, emergencies.

Your business also needs a dedicated emergency fund. It should include at least a few months’ worth of expenses — and yes, this includes payroll to cover any employees who depend on your business for their livelihoods.

Tuck your business emergency fund into a high-yield savings account, where it can grow while it’s not in use.

Credit cards as “emergency funds”

I’ve heard from many folks, including business owners, who claim they don’t need an emergency fund because they can just charge stuff to their credit cards. Well, folks, those credit cards still need to be paid off.

Unless you have a 0% APR offer on that card, it will start accruing interest at an alarming rate. Letting that interest grow untamed because you don’t have an energy fund on hand to cover the balance can create its own emergency.

Don’t get me wrong, I think most business owners should have a small business credit card. They can earn valuable rewards, and they offer a reliable payment method for businesses with sporadic cash flow. Just don’t fall into the trap of thinking you can charge away your money problems. It doesn’t work like that.

4. Being too laid back about unpaid invoices

As a bit of an introvert, I definitely learn toward the “avoid conflict” side of things. But there’s a fine line between being non-confrontational and being a doormat. And it gets worse when you’re a small business owner whose income relies on strangers paying you on time.

One study by Entrepreneur found that the average small business has $84,000 in unpaid invoices, for a total of around $825 billion. With so many of us living contract-to-contract, even one unpaid invoice could be the difference.

Stand up for your services. Be polite but firm about payments. Make sure you keep track of who owes you what — and follow up on folks who are slow to pay. Often, persistence can be enough to get clients to make good. If that fails, however, you may need to hire an attorney to send a letter, or perhaps even consider filing in small claims court.

5. Letting personal and business finances mingle

The smaller your business, the more the lines between personal and business expenses can get blurry, especially if you work from home. Unfortunately, this financial mishmash can be a huge pain in the neck when it comes to tracking business expenses — and, worse, filing taxes (it’s easy to miss a valuable deduction if it’s lost in the financial shuffle).

That’s not to say I never put a business expense on a personal card to maximize my rewards. But the only reason I can get away with it is that I always carefully log business purchases in my accounting software (including noting the card used to pay so I can look it up if needed in the future). I also have a dedicated business checking account that pays for those charges, regardless of which card I use.

Running a business is a complicated business, and we all make mistakes. Ideally, these tips help you avoid some common financial mistakes — so you can make some new mistakes of your very own!

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

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Big-box retailers can be both affordable and convenient. But should you be shopping at them? Read on to find out. [[{“value”:”

Whether you live alone or manage a larger household, there are certain products you probably buy on a regular basis, like groceries, apparel, and personal care items. And you have choices for where and how to buy them. You could head to your local big-box store, or you could take your business elsewhere, like a warehouse club store or locally owned shop.

You may be quick to assume that big-box stores are your best bet for shopping. But here’s why that line of thinking might backfire on you.

1. You may not get the lowest price

It’s natural to assume that when you visit a big-box retailer, you’re going to get the best price in town. But that’s not automatically true.

Depending on what you’re buying, you may be better off visiting a dollar store or discount grocer for added savings. Or, if you’re buying a lot of a specific item, it could pay to see what the price is at your local warehouse club store. Big-box stores sometimes offer bulk discounts, but the bulk discounts you get at a store like Sam’s Club or Costco may be more substantial.

2. You may be tempted to overspend due to the wide selection of inventory

When you shop at a store like Walmart, you’re by no means limited to groceries and cleaning products. You can find pretty much anything at Walmart, whether it’s makeup, home decor, or toys.

It’s for this reason that big-box stores like Walmart can be a dangerous place to shop. When you have so many choices under the same roof, it’s easy to fall victim to impulse buys that could really bust your budget.

If money is tight, you may want to remove temptation in the course of your shopping by planning your trips more strategically. If the only items you’re looking to buy, for example, are groceries, then you could be better off skipping the visit to Walmart or Target and instead just hitting the supermarket.

Granted, you might still get tempted to buy something extra, like a tub of your favorite cookie dough that happens to be on sale. But you at least won’t be tempted to buy a new gaming system or wardrobe.

3. You may not get the customer service experience you want

During the 12-month period ending Feb. 3, Target enjoyed about $4 billion in net earnings. That’s a great thing for the retail giant — and the investors who own its stock. But it doesn’t necessarily bode well from a customer service perspective.

Another reason you may not want to shop at big-box stores is that they’re not exactly desperate for business. Because of this, you may not get the customer service you’re after.

Of course, it’s not a given that a larger retail chain won’t step up on the customer service front. Costco, for example, is known for its generous return policy. The point, however, is that you may not get the same experience at a store like Target or Walmart as you might at a small business that really works hard to retain customers.

Shopping at big-box stores is certainly convenient. And sometimes, there really can be nice savings involved. But before you default to stores like Target and Walmart, spend some time researching prices to make sure you’re getting the good deals you think you are. And also, learn when it pays to stick to a plain old supermarket or local business instead of your nearest big-box establishment.

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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.Maurie Backman has positions in Target. The Motley Fool has positions in and recommends Costco Wholesale, Target, and Walmart. The Motley Fool has a disclosure policy.

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Shopping is expensive these days. Read on to find easy ways to save $50 or more at the discount warehouse club. [[{“value”:”

Costco is great for finding good deals on bulk food items, but there are many more ways to help your monthly budget than grocery shopping.

The longer I have my Costco membership, the more I realize how many ways there are to save money that don’t involve canned goods or boxes of cereal. Here are five quick ways to save $50 at Costco.

1. Buy furniture online and have it delivered

Savings: More than $100

I recently spent some time looking at furniture on Costco’s website and was surprised to see that Costco doesn’t charge a delivery fee for online furniture purchases.

Costco’s website says there’s free delivery, set-up, and packaging removal for a leather sofa I was looking at. Free delivery and set-up is a great deal and will save you far more than $50, considering that some online retailers, like Room and Board, charge $119, and many stores charge much more.

Tip: You have to buy your Costco furniture online to have it delivered. The company currently doesn’t offer a delivery service for in-store furniture purchases.

2. Buy your prescriptions at Costco

Savings: More than $50

Costco gives its members access to the Costco Membership Prescription Program (CMPP), which has discounts of 2% to 40% on medications across 19,000 participating pharmacies.

Considering the average American spends more than $1,200 on prescriptions yearly, a discount on even one medication could save Costco members more than $50. For the five most common prescriptions, Costco members could save up to $739 or more annually.

3. Buy a Southwest Airlines gift card

Savings: $50

If you’re looking for some easy savings while booking your next vacation, Costco is your best bet. A $500 Southwest Airlines gift card is currently just $449.99, saving you $50.01.

Of course, there are plenty of other gift card deals at Costco as well. You can buy discounted gift cards for everything from restaurants to Xbox video games. If you frequently go to the movies, you can save $50 by purchasing five $50 Cinemark gift cards for just $40 each.

4. Buy a new Apple MacBook Air computer

Savings: $50

My current computer is burning through its battery much faster than it used to, which isn’t great for me as a freelance writer who’s often writing away from home. I’ve been eyeing the latest 13-inch MacBook Air, which costs $1,099 on Apple’s website, but I’ve been shopping around for a better deal.

Costco is selling the same model for $1,049.99, which would instantly save me $50. But there are also some hidden savings in this price. Costco’s free two-year warranty applies to all electronics, including Apple computers. That extends the warranty an additional year compared to Apple’s standard warranty.

If I decide to buy the AppleCare+ three-year warranty through Costco, I’ll save $39 compared to buying it through Apple, which could boost my total savings to $89.

5. Get your tires installed

Savings: $100

Many Costco stores have a tire center where you can buy tires, have your oil changed, or have a battery replaced. You may not know that if you buy a set of four tires at Costco, you can have them put on your vehicle free of charge.

Many automotive shops charge about $100 to install four tires. With Costco selling name-brand tires at its stores with free installation, there’s no reason not to take advantage of that savings.

With all the potential ways to save $50 or more at Costco, members will quickly earn back the $60 they’ll pay for the Gold membership or the $120 for the Executive Membership. The latter gives you 2% cash back on Costco purchases, so you’ll rack up the savings the more you shop.

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.Chris Neiger has positions in Apple. The Motley Fool has positions in and recommends Apple and Costco Wholesale. The Motley Fool recommends Southwest Airlines. The Motley Fool has a disclosure policy.

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There are many ways to make retirement savings mistakes, and those can lead to significant losses. Read on for three big errors to avoid. [[{“value”:”

Saving for retirement sounds so straightforward: You put away as much as you can afford to each month, and in return, you get a source of income once you stop working. But in reality, there are many ways to make expensive mistakes. At best, these can mean you don’t get to do as many of the things you wanted, and at worst they may mean you have to delay retiring so you can afford to live comfortably.

Here are three big retirement mistakes to watch out for.

1. Waiting to start saving for retirement

If you’ve ever read anything about retirement on the internet, you’ve probably heard about the magic of compound interest (™). But there’s a reason why everyone brings it up: It can be a powerful tool. That said, if you’re not saving for retirement early in life, it can also hurt you.

Let’s say you save $6,000 in a retirement account at the age of 22. If you were to invest that amount until age 65, it would grow to almost $50,000. And that’s assuming you never contributed anything else to that account. However, you’d only have about $33,000 by waiting to do this until age 30. That’s assuming a low 5% annual rate of return. Over the years, you could stand to lose a substantial amount of money for retirement. So it’s always best to start as early as you can, even if that means only contributing $25 a month.

2. Ignoring Roth IRAs

The type of accounts you use can also have a major impact on how much you actually have to retire on. For example, both 401(k)s and traditional individual retirement accounts (IRAs) lower your taxable income now. The tradeoff, however, is that you’ll have to pay taxes on those funds in retirement, reducing how much you actually get to live on.

That’s where Roth IRAs come in handy. While you won’t get the tax benefits now, you get to keep all of that cash in retirement (assuming you make qualified distributions), which can help you mitigate your tax burden in retirement. And the limit for IRAs (including Roth IRAs) is separate from a 401(k), so you can still contribute however much you want or can to that account while also contributing to an IRA. You just have to open the account, set up deposits, and make sure that cash is being invested.

3. Not readjusting your investing strategy as you get older

If you’re only considering your retirement investing strategy whenever you change jobs, you may be putting yourself at a disadvantage. That’s because, in general, you’ll want your investment mix to become more conservative the closer you get to retirement.

Typically, that means reducing the proportion of higher risk stocks, and increasing the proportion of bonds. You can use the rule of 110 — where you subtract your age from 110 — to estimate the right percentage for stocks. So by the time you’re 50 years old, that rule says 60% of your portfolio should consist of stocks.

Think of it this way: If you’re planning on retiring in 20 years, you can afford to weather shorter-term financial storms. But if you’re retiring in just five years, hits from market lows can have a greater impact on your savings. For instance, there may not be time for you to earn those losses back, meaning they’ll be locked in when you take some of that cash out. So you’ll want to make sure that your portfolio is becoming less risky over time to avoid that issue.

Saving for retirement is important, but it can also be tricky to accomplish if you don’t know the many pitfalls you need to avoid. But by taking steps to guard against losses and starting to save early, you’ll be in a better position to retire when the time comes.

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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.The Motley Fool has a disclosure policy.

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