By: Ashley Maready |
Updated
– First published on Sept. 9, 2023
An emergency fund is your best protection against unexpected bills hitting your budget like a speeding freight train. There’s no possible way to account for every expense life will throw at you, and it can be a terrible feeling to put a surprise car repair or medical bill on a credit card because you’re otherwise unable to cover the cost.Experts recommend saving at least three to six months’ worth of expenses for your emergency fund (to figure out how much you should save, have a look at our emergency fund calculator). But honestly, any amount of extra cash can help you out of a jam, so don’t feel bad if it’s hard for you to save.You’ll also need a safe place to keep your money, and there’s one type of bank account that could be the perfect fit. Let’s take a closer look at money market accounts and why they work for emergency funds.Really, a money market account?Depending on how deep you are in banking and the personal finance space, you might be unfamiliar with money market accounts. These bank accounts are almost like a cross between a checking account and a savings account, with some of the features from each.Money market accounts earn interest, like savings accounts do. In fact, among bank accounts that allow you to add and remove money while the account is open (unlike CDs, which require locking your money up for the term of the CD), money market accounts have the highest average APY as of this writing, at 0.62%. However, this is an average of all money market accounts, and some online banks are paying much higher rates.Take a look at our favorite money market accounts and you’ll see that many are paying at least 4%. That could generate a handsome return indeed. If you have a $10,000 emergency fund and you stash it in a money market account earning 4% APY, you’ll make almost $400 in a year if your APY doesn’t change and you don’t add any more money to the account.Money market accounts also come with check-writing capabilities or a debit card (and sometimes both), just like checking accounts do. It’s this quality that makes them especially great for an emergency fund. When you have a surprise bill to pay, you might need that money immediately, and savings accounts don’t always offer the best access to your money.I have a high-yield savings account that I opened with an online bank last year, and while I love many things about the account, it was a little irritating that I had to open a checking account to link to it so I could get a debit card. And I still have to transfer money from my savings to my checking if I want access to my saved cash. A money market account makes it easy to reach your money in a pinch.One potential drawback of money market accountsBefore you rush to open a money market account for your emergency fund, slow your roll and consider one quality of these accounts that might give you pause. Some money market accounts have a minimum balance requirement to open the account or earn the highest APY offered.This isn’t ideal, especially if you’re still in the process of building your emergency fund and don’t yet have enough money to open the account or to earn a high APY. So if you’re trying to decide between accounts, definitely read the fine print and make sure the ones you’re considering can be opened with a smaller amount of money (or even none at all) and will pay you the best rate regardless of your balance.If you currently have your emergency fund stashed in your checking account or stuck in a regular savings account and earning no interest, take a closer look at money market accounts. One might just be a great home for your emergency fund.
By: Dana George |
Updated
– First published on Sept. 10, 2023
In this case, paying 2% in ongoing annual fees means leaving over $102,000 on the table.How to know what you’re being chargedTo understand how you’re charged, it helps to understand the different types of fees. Typically, there are two — ongoing fees and transaction fees. Ongoing fees are charged regularly, such as an annual account maintenance fee. Transaction fees are charged each time you make a transaction. For example, if you buy a mutual fund, you’ll pay a one-time fee.The simplest way to learn the type of fee you’ll be charged and how much you can expect to pay is by reading the material provided by your brokerage. Look at the opening documents, account statements, confirmation, and any product-specific documents to find both the type and the amount of fees. Naturally, you know that an ongoing fee of 2% will eat into your investment more than a fee of 0.25%.Important questionsAccording to the SEC, these are some of the questions you should ask a financial professional before committing to an investment:How do these fees and expenses compare to other products that can help me meet my financial objectives?How much will this investment have to increase in value before I break even?How do you get paid? If it’s by commission, how are your commissions determined? (This question will give you a better idea of whether you’re being pushed in a particular direction to make more money for the advisor).What are all the fees relating to this account? Can you provide a fee schedule that lists all the fees that I will be charged for investments and maintenance?What fees will I pay to purchase, hold, and sell this investment?Will fees appear clearly on my account statement or my confirmation? If not, how will I know about them?How can I reduce or eliminate some of the fees I’ll pay? For example, can I buy the investment directly without a financial professional?Do I need to maintain a minimum account balance to avoid fees?Yes, it seems like a lot, but when you consider how much money you can lose to fees, asking these questions is worth your time.Check your statementsIf the Wells Fargo situation teaches us anything, it’s that we should check our statements to ensure that we’re not being overcharged for fees. It’s up to you to check your statements and to raise an alarm if you are being overcharged.Just as you would shop around for any other product or service, shop around before you invest.
By: Dana George |
Updated
– First published on July 25, 2023
Costco has a faithful legion of fans — otherwise known as members. There are 123 million of them, to be precise. Throughout the years, Costco has added new membership benefits, some less well-known than others. Here are four that members may not realize exist.1. RV parkingWhether you spend part of each year visiting the highways and byways of North America or you’re hoping to rent an RV for your next vacation, it’s good to know that some Costco locations allow RVs to park overnight in their lots. Free overnight parking can certainly cut down the cost of travel.Consider the convenience. You arrive near closing time, pick up all the items you’ve already burned through or forgotten to bring, and spend the night in a well-lit lot. Granted, pulling an RV into a (typically) packed Costco lot may not be the easiest thing you’ve ever done, but once the lot clears out, you may even hear the sound of crickets.Notice we said that some Costcos permit overnight parking for RVs. When a store does not, it’s often because local ordinances don’t allow it. However, with so many Costcos scattered across the country, you should have options.The easiest way to determine which Costcos allow overnight RV parking is to check this Costco locations finder. Once you see one near where you plan to stay, call that store and ask to speak with the manager. Once you have them on the line, ask about their overnight policy. If the store does permit overnight parking, ask for permission to stay. According to the Camper Report, Costco has rules for campers, so you may want to ask where you can get a copy of those.2. Home, auto, renters, and specialty insuranceIn the back of our minds, most of us realize that Costco offers insurance, but we’re not sure of the details. Partnering with CONNECT, powered by American Family, Costco members receive discounted rates on many of their insurance needs. Beyond the initial discount, CONNECT allows you to add more. For example, you may qualify for a safe driving, multi-policy, or student discount.And if you’re an Executive member, CONNECT sweetens the pot even more by providing you with benefits like roadside and lockout assistance.At a time when many people are unhappy with the insurance industry, 9 out of 10 members who sign up for CONNECT coverage go on to renew their policy with the insurer.3. Home and business suppliesWhile it may occur to you to pick up envelopes and printer paper at Costco, have you ever taken advantage of the low prices on items like checks, ink stamps, and address labels? Many of the supplies you need to take care of business — at home or in the office — are available for up to 50% off.Executive members enjoy an even deeper discount.4. Floral deliveryOnce you factor in delivery costs, sending a lovely bouquet of flowers to someone can cost a small fortune. That’s not the case at Costco. Costco’s online floral department offers everything from anniversary and graduation bouquets to bulk flowers. And here’s where the real savings come in: Delivery is free. The price you see listed on the site, plus tax, is the price you pay.Few things are more frustrating than typing your credit card number into a florist’s site, only to learn that delivery costs nearly doubled your purchase price.As Costco layers on new perks, keeping track of them may become even more difficult. It’s a good idea to check periodically to see if there are any you’re not taking full advantage of.
By: Emma Newbery |
Updated
– First published on Aug. 7, 2023
Are SNAP benefits enough?A monthly payment of $973 for a household of four equates to around $8 per person per day. While SNAP benefits aren’t designed to cover everything, it isn’t easy to feed a family on around $2.66 per person per meal. Indeed, research from the Urban Institute showed that the maximum benefits often don’t cover a family’s food costs. “Amid inflation, SNAP benefits did not cover the cost of a meal in 99 percent of counties in 2022,” said the report.The new benefit amount — a monthly increase of $34 for a household of four — is roughly in line with cost-of-living increases measured by the Bureau of Labor Statistics (BLS). Its latest Consumer Price Index figures show that the cost of all items in June, 2023 was up 3% over the year before. However, inflation does not impact all aspects of life equally.The BLS data also shows that food at home increased by 5.7% year over year. The new SNAP benefits do not match this. Hypothetically, a 5.7% increase in benefits for a family of four would mean a new monthly payment of $992, rather than the planned $973.In addition, this year brought the end of the pandemic-era emergency food benefits throughout the country. According to CBPP calculations, this meant the average person received about $90 a month less in SNAP benefits. Even factoring in the increased SNAP benefit amount, many households have seen a significant drop in their food benefit amount, and the revised 2024 payments will do little to close this gap.How to make your SNAP benefits go furtherIt can take time and energy to provide healthy food for your family on a strict budget. The challenge is that in a busy household, time and energy are also limited resources. Even so, if you can carve out some time to plan your grocery-shopping trip, it can make a big difference.Here are some ways you might stretch your SNAP benefits a little:Use cash back apps and coupons: Look for cash back apps that work in stores that take your EBT card. You’ll usually need to download an app and then scan your receipt after you’ve been to the store. Pay attention to coupons, whether in store or online as these can often carry hefty discounts.Always shop with a list: Planning your food shopping is one of the best ways to reduce costs. Even more so if you use a cash back app or coupons. Check what offers are available on items you normally buy before you go shopping. Mark the items that qualify for rewards or discounts on your list, so you don’t miss them when you’re shopping.Look for double up programs: There are Double Up Food Bucks or other programs in various states that essentially give you two for one on all produce at participating farmers markets and stores. It’s a great way to get more fruit and vegetables for your SNAP dollars.Buy in bulk and batch cook: It isn’t always easy to find the extra cash for bulk buying when you’re eking out every cent. However, if you can manage it, you may be able to save both money and time. You might, for example, batch cook a stew and freeze portions for future meals.Unfortunately, food insecurity still impacts many American households. If you don’t have enough money to feed your family this month, look for additional help. Find out what food pantries and soup kitchens are operating in your area on which days, and whether you’ll need to present any documents. Call United Way at 211 for information about assistance programs in your area.
By: Brittney Myers |
Updated
– First published on Sept. 4, 2023
As my fellow personal finance fanatics can attest, getting a good bargain feels good. But we’ve all been bitten by the bargain that wasn’t — you know, those items that are so bad, even the low price doesn’t stem the tide of regret.Store brands, in particular, are often guilty of being on the wrong side of the quality-price scale. That is, unless you’re shopping at Sam’s Club. The Member’s Mark house brand is not only full of great values, but many of the items are of name-brand quality (or better).Here’s a look at some of the best products unique to Sam’s Club that offer value and quality.1. Member’s Mark Ultra Premium Soft & Strong 2-Ply Toilet PaperToilet paper is one of those things that many of us don’t realize we have strong opinions about — but we all do (and that’s before you get started on the over-under debate!). The Member’s Mark toilet paper must be made of clouds and parental approval, because it has over 78,000 five-star reviews. Think about that: 78,000 people took time out of their day to say this is good toilet paper. And, of course, you can’t beat that price.Cost: $22.98 ($0.002 per sheet)Rating: 4.9 / 5.02. Member’s Mark AntihistaminesPersistent allergies are the worst, and not just for your face — though that can really suck. They can also be really bad for your budget when you need a daily antihistamine. Member’s Mark has two different types: Aller-itin loratadine tablets and Aller-Zyr cetirizine tablets (based on the active ingredients from Claritin and Zyrtec, respectively). Users give both products 4.9 stars, and the cost per pill is a fraction of what the name brands charge.Cost: $12.23–$15.98 ($0.03–$0.04 per pill)Rating: 4.9 / 5.03. Member’s Mark Super Premium 2-Ply Paper TowelsWhile I’ve started relying more on washable towels than paper ones, some jobs simply require a good paper towel. The Member’s Mark select-and-tear option performs well while costing less than $0.01 per towel. (And in case you’re wondering, the name-brand Bounty towels cost more than twice as much — and they only have 4.6 stars.)Cost: $19.98 ($0.008 per sheet)Rating: 4.9 / 5.04. Member’s Mark Natural Shelled WalnutsWalnuts are a delicious snack and an excellent addition to baked goods, but they have one major drawback: They’re expensive! Member’s Mark walnuts are a reasonable price, and I think they taste pretty good, too. I’m not alone, either; they have a couple thousand reviews giving them a total rating of 4.8 stars. In fact, you can find a variety of whole nuts under the Member’s Mark brand, all of which seem to be fairly well reviewed.Cost: $7.98 ($0.17 per ounce)Rating: 4.8 / 5.05. Member’s Mark Coffee Single-Serve CupsCoffee pods are undeniably convenient, but those little 12-count boxes from the grocery store can be ridiculously expensive. Member’s Mark makes five different types of single-serve coffee pods, all of which have at least 4.7 stars (the French Roast edges out the rest with 4.8 stars). They also have a completely reasonable cost of just $0.28 per cup.Cost: $27.98 ($0.28 per cup)Rating: 4.7 / 5.06. Member’s Mark Premium Chunk Chicken BreastChicken is one of the most versatile ingredients around, and a quality canned version means you always have it on hand. Use it for salads, soups, and even quesadillas for quick and easy meals. While I haven’t tried this one myself, Member’s Mark chunk chicken breast has more than 8,500 five-star reviews and an overall 4.7-star rating.Cost: $12.84 ($2.14 per can)Rating: 4.7 / 5.07. Member’s Mark BatteriesFor every new rechargeable device you can purchase, there are still two more electronics that seem to require an endless stream of batteries. (Why do TV remotes eat batteries so fast?!) Member’s Mark sells big packs of both AA and AAA batteries for less than $0.50 a battery. And they seem to work well; a few thousand reviewers have given both battery types a total rating of 4.7 stars each.Cost: $21.48 ($0.50 per battery)Rating: 4.9 / 5.0Tip of the bargain icebergProvided the quantities don’t overwhelm your pantry, there are a ton of deals to be had at Sam’s Club, especially on Member’s Mark items. But there are other perks to a Sam’s Club membership worth mentioning. For instance, if you have a Plus membership, you also get free shipping and free store pickup, and Scan & Go, which lets you cut the checkout line (it’s truly revolutionary).Then there’s also the fact that you don’t have to worry about which credit card you’re using (I’m looking at you, Costco). While Sam’s Club, like Costco, won’t code as groceries on your credit card bill, you can still get some good credit card rewards with the right card. Since you’re already getting a bargain on prices, that extra bit of savings from your rewards is icing on the proverbial cake.
