Alan Fraser Houston
keyboard_arrow_right
Cash Back
Business, Cash Back

Best credit cards for couples

Joining your lives also means marrying your credit card rewards strategy, which starts with picking the right cards.

If you’ve said your vows or joined your finances with your partner, it might be time to move past the credit card that’s been by your side all through your single years. And even if you keep that card, it pays to consider adding cards that give couples the chance to earn big.

Whether you’re combining your finances or keeping them separate, you can still meld your rewards, says Jason Steele, a credit card and award travel expert at The Points Guy who teams up with his wife on rewards.

“The reasons for keeping money separate might not apply to points and miles, especially if you travel together,” he says.

Here’s a rundown of some of the best rewards cards for couples and tips on how you can use these cards and your married or domestic partner status to get the most from your rewards.

See related: How to save on your babymoon

Double up on big travel bonuses

One of the best perks of being a couple is that a sweet sign-up bonus can become double in value.

One popular card for couples, the Chase Sapphire Preferred Card*, offers a sign-up bonus of 60,000 points, worth $750 when redeemed for travel through the Chase Ultimate Rewards portal. To get the bonus, you have to spend $4,000 in the first three months after opening the account. This minimum spend should be fairly easy to reach with two people pulling out the card for all purchases.

It’s important to note that the bonus is available to you only if you don’t have a Chase Sapphire card now and haven’t earned a bonus for opening one in the past 48 months. But if both you and your sweetie are eligible and get the card, one after the other, that’s 120,000 points worth $1,500 or possibly much more if transferred into an airline frequent flyer program.

The Chase Sapphire Preferred card also offers several other ways for savvy newlyweds to stack bonuses and save:

  • Chase offers another bonus through its refer-a-friend program. While it can be fraught to refer a friend to a credit card, it’s much easier to refer your new husband or wife. When one spouse becomes a cardholder and refers the other, you get another 15,000 extra points.
  • Any card with Chase Ultimate Rewards, including this one, allows you to transfer points between spouses or domestic partners for free. This makes it easier to book travel and also helps to ensure you don’t get separated during a trip as you could if you were on separate reservations. “It’s a million times easier just to put everything in one account and book all under one reservation,” Steele says.
  • Keep in mind that when two members of a couple each get a card, they can get hit with double annual fees. With the Chase Sapphire Preferred, the annual fee is $95.

How should you handle the double sign-ups? First, one of you can get the card. You can work together to complete the minimum spend on the first card and get the sign-up bonus. The cardholder then refers the other spouse through the refer-a-friend program to snag another 15,000 points. Spouse No. 2 can get the card. Then both work to complete the minimum spend for the second sign-up bonus. This way, a couple can rack up 135,000 points in six months.

There’s a lot of payoff in doubling big sign-up bonuses. “If it’s a good deal for one, it’s a great deal for two,” Steele says.

See related: Chase Ultimate Rewards cards: Which one should you get?

Profit from double-spending cash back power

Two more cards that work nicely for couples are the Blue Cash Preferred® Card from American Express and the Discover it® Cash Back card. With these cards, couples can rack up rewards quickly through the spending power of two.

Here’s the lowdown on how you can gain from getting the Blue Cash Preferred Card or the Discover it Cash Back card.

  • The Blue Cash Preferred Card works well for daily spending. It offers 6% cash back on eligible purchases at U.S. supermarkets on up to $6,000 a year (then it’s 1%), 6% on select U.S. streaming services, 3% on gas fill-ups at U.S. gas stations, 3% on transit purchases such as parking, taxis and ride-sharing services, and 1% on all other purchases. However, there is a $95 annual fee, so it might not make sense for both people to get the card.
  • The Discover it Cash Back card offers 5% cash back in rotating quarterly categories  (once enrolled every quarter) up to a quarterly maximum and 1% on all other purchases. Couples can “hack” this to rack up big rewards, says Jacob Lumby, who has a Ph.D. in financial planning and is co-founder of CashCowCouple.com. For example, the category for January through March 2021 is grocery stores, Walgreens and CVS, and the quarterly cap is $1,500. For a dual cardholder household, that cap becomes $3,000. “That’s a really big deal,” Lumby says. He and his wife, Vanessa, buy gift cards to the places they shop to ensure they use the entire allotted amount in rotating categories.
  • The Discover it Cash Back card has no annual fee, so it makes financial sense for both spouses or partners to become cardholders to increase the bonus category cap. And Discover will match all the cash back you earn in your first year with no limit. “That offer makes the card even more powerful,” Lumby says.

Another big plus for both of these cards is they offer 0% introductory periods on purchases. The Blue Cash Preferred Card offers a 12-month intro period, while the Discover it Cash Back card offers a 14-month intro period. After that, the variable APR on the Blue Cash Preferred Card ranges from 13.99% to 23.99%, while on the Discover it Cash Back card it ranges from 11.99% to 22.99% variable.

It’s a fact of life that many couples start married life either in debt from the wedding or at least strapped for cash, says J.R. Duren, a personal finance blogger for the consumer site HighYa.com. On top of that, couples who don’t already live together will likely be joining households and may need a new fridge, bed or some other pricey item.

One caveat, though: Don’t let the zero-interest offer tempt you to start your life together digging into debt. Instead, figure out how much you will have to pay each month to pay off your purchase without paying a cent in interest. Make sure it’s doable before you buy.

“Getting married costs you money both before and afterward,” Duren says. “If you can pay off the balance during the promotional period, it’s a really good idea to use one of these cards to finance a big purchase.”

See related: 5 tips for pooling credit card rewards spending

Get a travel bonus made for two

One popular perk, the Southwest Companion Pass, seems like it was made for couples in the honeymoon phase. If you earn the pass, it will allow your new Mr. or Mrs. to fly with you for free for almost two years if you get the timing right.

“How do you beat that?” Lumby says. He and his wife have combined award flights with the Southwest Companion Pass to soak in the sun in Aruba and Jamaica without having to shell out much cash. When you buy a ticket with miles, your companion still can use the pass.

The eligibility requirements to get the Pass can be challenging to meet, but if you have one of the Chase Southwest Rapid Rewards credit cards (Southwest Rapid Rewards Plus Credit Card, Southwest Rapid Rewards® Priority Credit Card or Southwest Rapid Rewards Premier Credit Card), earning the Companion Pass becomes much more realistic.

If this perk sounds good and you plan to apply for a Southwest Rapid Rewards credit card, here’s what you should consider.

  • It’s easier than ever to get the Companion Pass now, thanks to the new limited-time sign-up bonus offer from Chase. If you sign up for one of the Southwest Rapid Rewards cards and spend $5,000 on purchases in the first three months, you can earn the Companion Pass, valid through Feb. 28, 2022, and 30,000 Rapid Rewards points. The offer is only valid through March 10, 2021, so it makes sense to apply as soon as possible if the Companion Pass if your goal.
  • You should apply for this and any other Chase cards you want first so you don’t get turned down due to Chase’s 5/24 rule. The rule could get you rejected for a Chase card if you’ve opened five or more cards with any issuer over the past two years.
  • The annual fees for these cards are not waived the first year. You’ll have to decide if the chance to earn the Companion Pass makes the fees worthwhile. Think about how often you and your beloved will use the Pass, and crunch the numbers.
  • When you get a Companion Pass, you have to designate one person as your travel companion, which is perfect for newlyweds. Timing is important because you get the pass for the following calendar year plus the rest of the calendar year in which you earned the pass (unless you’ve earned it with the sign-up bonus offer). The earlier in the year you can earn it, the better.

With this card, it doesn’t make sense for both members of the couple to become cardholders, Lumby says. Instead, one should sign up and focus on getting the Companion Pass for the other, but you could add your spouse or partner as an authorized user so you both can build up the spending required to qualify for the bonus.

Bottom line

Married life has its rewards, especially when it comes to credit cards. But it’s important to get your finances in order, create a budget and get on the same page about money before you delve into points and miles together, Duren says.

If money is super tight, you might want to get just one solid cash back card first or even avoid credit cards altogether for a while. “In some cases, it might be best to focus on strengthening your finances now and worry about rewards later,” he says.

*All information about the Chase Sapphire Preferred Card has been collected independently by CreditCards.com and has not been reviewed by the issuer. This offer is no longer available on our site.

Source: creditcards.com

Cash Back, DIY

Best credit cards for grocery shopping

Americans spend on average $4,464 in groceries every year, according to the U.S. Bureau of Labor Statistics. Shopping for groceries is one of the main weekly expenses in every American household.

That’s why the credit cards tying reward points to grocery shopping are getting more numerous and their offers are getting increasingly more competitive. In 2020 you have a whole new lineup of cards ready to reward you for the purchases you make at grocery stores.

Here are the best cards whether you like those premium rewards, are an everyday shopper, are building credit, you’d rather skip the prep and go straight to the meal or you like to buy groceries at superstores.

See related: Best cash back cards

American Express® Gold Card: Best for earning Membership Rewards points on groceries

Amex Gold gives you an unprecedented rewards rate whether you’re dining in or out. If that weren’t enough, paying at certain eligible restaurants (see terms for qualifying merchants) after enrollment can get you up to $10 a month in statement credit. You also get up to $120 in Uber Cash every year ($10 per month) that can be applied to U.S. Uber Eats orders – a big plus for those who order their groceries through the platform (must add Gold Card to Uber app in order to receive the Uber Cash benefit).

The intro bonus of 60,000 points when you spend $4,000 in the first six months is excellent, and there are many redemption options, including gift cards, merchandise and travel with no blackout dates.

American Express® Gold Card should appeal to frequent ride-share users and takeout lovers alike. Cardholders enjoy $120 in Uber Cash each year, which can be used for Uber rides, Uber Eats delivery and more. Enroll by Dec. 31, 2021 and you’ll also get a complimentary Uber Eats Pass membership for 12 months, which comes with discounts and $0 delivery fees on eligible restaurant and grocery purchases.

The card charges an annual fee of $250, but if you take advantage of both the Uber Cash and the dining credit, keeping the Amex Gold card will essentially cost you $10 every year.

If you are OK with only redeeming travel directly through Amextravel.com or Amex’s airline partners to maximize the value of the Membership Rewards points you’ll earn, this is a great card for foodies and travelers.

Here’s a closer look at the features:

  • 60,000 American Express Membership Rewards points when you spend $4,000 in the first six months
  • 4 points per dollar spent at U.S. supermarkets on up to $25,000 per year in purchases – 1 point thereafter
  • 4 points per dollar spent at restaurants worldwide (including Uber Eats orders)
  • 3 points per dollar spent on flights booked directly through airlines or on amextravel.com
  • Up to $120 annual dining credit (up to a $10 statement credit monthly) when you pay at Grubhub, The Cheesecake Factory, Ruth’s Chris and participating Shake Shack locations (enrollment required)
  • Up to $120 in Uber Cash per year ($10 per month)
  • No foreign transaction fees

Even though it has fewer features than the Amex Gold, it gives you perhaps the highest cash back rate available on groceries, and it has a lower annual fee – $95. Plus, running errands like groceries is way easier when you get cash back on gas for the commute. Take a closer look:

  • $250 statement credit when you spend $1,000 in the first three months
  • 6% cash back at U.S. supermarkets on up to $6,000 in purchases per year, then 1%
  • 6% cash back on select U.S. streaming services, such as Netflix, Hulu or HBO Max
  • 3% cash back at U.S. gas stations
  • 3% on transit purchases
  • 1% cash back on all other purchases

Chase Freedom Unlimited®: Best for earning cash back on groceries and everything else

For those who don’t want to have to choose a spending category but still want no annual fee, Chase Freedom Unlimited offers a consistent rate of at least 1.5% cash back on all purchases.

  • 5% cash back on travel through Chase Ultimate Rewards
  • 3% cash back on dining and drugstore purchases
  • 1.5% cash back on all other purchases
  • $200 bonus if you spend $500 in the first 3 months
  • Cash back rewards do not expire
  • No annual fee

Target REDcard™: Best for earning cash back on Target purchases

The Target Redcard has no annual fee. This, combined with its standard offer of 5% off in-store purchases applied right at the checkout counter and 5% off at Target.com with free shipping, makes it a great card for frequent Target shoppers, especially since the 5% discount is applied in perpetuity. You can also stack your discount with others available through Target’s Cartwheel app and in-store.

Though most people don’t need 120 days to return an item, you get that with this card when its extra 30 days is combined with Target’s standard 90-day return policy. The extra time could allow a greater piece of mind on those large ticket items you buy.

However, if you’re known to carry a balance, this isn’t the right card for you. The high variable APR can far outweigh the 5% discount, so pay the card off after each billing cycle.

Here’s a snapshot of all the benefits of this card: 

  • 5% off eligible Target purchases in-store and online at Target.com (except pharmacy purchases)
  • Can be used together with Target Circle and other discounts
  • Free two-day shipping on orders from Target.com with no spending minimum
  • An extra 30 days to return items on top of the standard 90-day return policy
  • Early access to special events, products and promotions
  • No annual fee

This card is great because, unlike Target’s Redcard, it offers some cash back outside of Walmart purchases, including 2% cash back at restaurants and travel and 1% cash back on all other purchases.

However, while Target’s Redcard offers its in-store 5% discount with no limit, the Capital One Walmart Rewards Mastercard only offers the same discount in-store for the first 12 months and you have to use Walmart’s mobile wallet on your purchases to get it.

Where this card really shines is online, especially if you do a lot of grocery pickup or delivery orders from Walmart.com.

It’s very easy to apply for and, like the Redcard, it carries no annual fee, as well as some smaller benefits you’ll see below:

  • 5% cash back on Walmart purchases online, including grocery and delivery orders
  • 5% cash back on in-store purchases in the first year when you pay using the Walmart Pay digital wallet
  • 2% cash back on restaurant and travel purchases
  • 1% cash back on all other purchases
  • No annual fee or foreign transaction fee
  • Easily apply via text message
  • Card is automatically transferred to Walmart Pay digital wallet on approval
  • Fraud alerts and the ability to freeze your account

Comparing the best cards for grocery shopping

Card Grocery bonus Other rewards Annual fee
American Express® Gold Card 4 points per dollar spent at U.S. supermarkets on up to $25,000 per year in purchases – 1 point thereafter

 

  • 60,000 American Express Membership Rewards points when you spend $4,000 in the first six months
  • 4 points per dollar spent at restaurants worldwide (including Uber Eats orders)
  • 3 points per dollar spent on flights booked directly through airlines or on amextravel.com
  • Up to $120 annual dining credit (up to a $10 statement credit monthly) when you pay at Grubhub, The Cheesecake Factory, Ruth’s Chris and participating Shake Shack locations (enrollment required)
  • Up to $120 in Uber Cash per year ($10 per month)
$250
Blue Cash Preferred® Card from American Express 6% cash back at U.S. supermarkets on up to $6,000 in purchases per year, then 1%
  • $250 statement credit when you spend $1,000 in the first three months
  • 6% cash back on select U.S. streaming services, such as Netflix, Hulu or HBO Max
  • 3% cash back at U.S. gas stations
  • 3% on transit purchases
  • 1% cash back on all other purchases
$95
Bank of America® Cash Rewards credit card 2% cash back at grocery stores and wholesale clubs
  • $200 in online cash rewards when you spend $1,000 in the first 90 days
  • 3% cash back on a category of your choice (gas, online shopping, dining, travel, drugstores or home improvements and furnishings)
  • $2,500 combined quarterly limit on 2% and 3% cash back categories
  • 1% cash back on all other purchases
$0
Chase Freedom Unlimited® n/a
  • 5% cash back on travel through Chase Ultimate Rewards
  • 3% cash back on dining and drugstore purchases
  • 1.5% cash back on all other purchases
  • $200 bonus if you spend $500 in the first 3 months
$0
Capital One® Savor® Cash Rewards Credit Card 2% cash back at grocery stores
  • 8% cash back on tickets through Vivid Seats (offer ends January 2022)
  • 4% cash back on dining and entertainment
  • 1% cash back on other purchases
  • $300 bonus if you spend $3,000 in the first 3 months
$95
Target REDcard™ 5% discount at Target and Target.com n/a $0
Capital One® Walmart Rewards® Mastercard®
  • 5% cash back on in-store purchases for the first 12 months when using Walmart Pay
  • 5% cash back on Walmart.com purchases, including grocery pickup and delivery orders
  • 2% cash back on in-store Walmart purchases after the introductory period
  • 2% cash back on restaurant and travel purchases
  • 2% cash back on the purchase of gift cards at Walmart (online, app, Walmart Pay or in stores
  • 1% cash back on all other purchases
$0

Honorable mentions

There is no shortage of credit card options that reward grocery spending, so in addition to our top picks above, consider these alternatives.

  • Capital One SavorOne Cash Rewards Credit Card – A no-annual-fee alternative to the Capital One Savor Card, the SavorOne offers the same 2% cash back on grocery store purchases. While it offers a slightly lower rate on dining and entertainment than the Savor card, the SavorOne is a good alternative for those wary to pay an annual fee.
  • U.S. Bank Altitude Go Card – The newly launched U.S. Bank Altitude Go Card offers a competitive rewards rate on both dining and grocery purchases – 4 points per dollar on dining and food delivery and 2 points per dollar on groceries, to be exact. It also offers 2 points per dollar on gas and streaming service purchases and 1 point per dollar on everything else. Plus, it doesn’t charge an annual fee.
  • Amazon Prime Rewards Visa Signature card – If you prefer to do your grocery shopping at Whole Foods, you can’t beat the rewards rate on the Amazon Prime Rewards Visa Signature card. In addition to 5% cash back on Amazon.com purchases, the card offers the same 5% rate at Whole Foods locations. You’ll also earn 2% back on restaurant, gas station and drug store purchases and 1% on everything else. You have to be a Prime member to qualify for the card, but if you spend a significant amount on Amazon orders or at Whole Foods, your rewards can help offset the cost of membership.
  • Apple Card – The Apple Card is best known for its high rewards rate on Apple purchases, but it can also be a great choice for grocery shopping. When you make a purchase via Apple Pay, the card offers 2% back on all qualifying purchases. This is on par with some of the highest flat-rate credit card offers. Just make sure your preferred grocery story accepts the mobile wallet before you work this card into your rewards strategy.

How to pick the right card for grocery shopping

For most of us, using a credit card at a grocery store simply involves taking it out in the checkout line. But if you want to up your grocery shopping game and save some serious money, here are some tips and secret strategies from credit card experts and the most seasoned shoppers we could find.

When picking the credit card you’ll use at the grocery store most experts recommend either a card with a high cash back rate that can provide a percentage off every time you shop or a tiered rewards card that offers specific rewards every time you use it for groceries.

“When you use a cash back card, it’s like having a coupon to save a certain amount off your total purchase each and every time you buy groceries. This savings isn’t limited to grocery stores – a flat-rate rewards card will apply the same cash back or miles to all of your purchases,” says Ashley Dull of CardRates.com.

However, if you’re picking a tiered rewards card with a grocery store category, they often have a limit on how much you can earn annually.

For example, American Express limits the 6% cash back rate spent at U.S. supermarkets annually on its Blue Cash Preferred Card to $6,000 in purchases (after that, it’s 1%), so be mindful of those restrictions.

Apple Card gives you cash back every day.

You also want to pick a card where rewards don’t expire, there are multiple options for redemption and you can transfer rewards between accounts. Always keep track of the terms of your credit card and compare card features vigorously before making your final selection.

How to earn the most rewards while grocery shopping

If you really want to maximize your rewards at the grocery store, stack your savings with a cash back app such as Ibotta, Fetch Rewards or Checkout 51. Your grocery store’s loyalty app is also a great way to double-dip on savings.

“By taking a few minutes to scan in your grocery receipts, a family of four can easily earn over $25 a month in rewards,” says Nermeen Ghneim of The Savvy Dollar personal finance blog.

Finally, if you’re choosing a store-branded credit card because you tend to shop at the same store all the time, make sure you pay off the balance before the billing cycle resets because store cards tend to have very high interest and fees.

“Many people know that making a habit of paying off high interest credit cards will actually have a slightly negative effect on their credit,” says Dan Gallagher, author, retired financial planner and personal finance expert at ScoreSense.com. “But some grocery credit cards are in-house credit extensions, especially the ones that are valid in-store only. The in-store-only variety does not harm your score for avoiding interest and paying balances off early, so do not fear a grocery store credit card.”

*All information about the Capital One Savor card has been collected independently by CreditCards.com and has not been reviewed by the issuer. 

Source: creditcards.com

Cash Back

The Ultimate List of More Than 50 Budget Categories You Must Use

It is no secret that you need a budget.  But, it is imperative that it includes everything.  Take the time to review your spending and don’t leave anything off of it.  Below you will find a list of household budget categories you need to include. Forgetting even one off might be a big mistake.

It is no secret that the number one thing you must do to take control of your finances is to create a budget.  Without one, you really can’t see where your money goes.  Or, more importantly, you don’t get to direct your money to be spent as you would like for it to be!

While there are posts on how to create a budget, one question I get frequently is, “What categories should I include in a budget?”   When you are new to making a budget, something such as a personal budget categories list can help.  I agree.

As you create yours for the first time, it is important you don’t leave off anything important. A successful budget is one that includes a line item for every way you spend your money.

If you are just learning about budgeting, you will want to check out our page — How to Budget.

There, you will learn everything you want to know about budgets and budgeting.

To help you get a jump start on with your budget, and to make sure you don’t leave off any categories, download our free budget template.  This form has helped thousands get started with creating a budget.

SIMPLE BUDGET CATEGORIES 

Once you have your form, you are ready to figure out your budget categories!  While you may not have each of these as individual line items on your form, just make sure you include them all somewhere in your budget!

DONATIONS OR CHARITY CATEGORIES

These are all of the monthly donations you make to various charities.  Don’t forget about those you may make only once or twice a year as well!

Church
Medical Research
Youth Groups

SAVINGS CATEGORIES

While not needed to live, it is crucial that you always pay yourself before you pay anyone else.  Once you meet your necessary expenses, ensure you are saving enough each month.

If you are in your employer’s retirement plan, you pay those before you get your paycheck, so you would not include them.  However, make sure you account for the different types of savings accounts you may have.

Emergency Fund Savings
Annual Fees, such as taxes, insurance, and dues
College Savings
Investments
Christmas/Birthdays/Anniversaries
Additional Retirement (outside of your employer’s plan)

Read More:  Yearly Savings Challenge

CATEGORIES FOR HOUSING

No one will forget to add housing to their budget.  But, make sure you include the amount you may save for repairs and other expenses. To figure out how much to budget, look over your prior year spending and divide that total by 12.  You will add this to your savings, but you can track it under your housing budget category.

First Mortgage
Second Mortgage (if applicable)
Property Taxes
Insurance
Home Owner’s Association Dues
Maintenance
Housekeeper/Cleaning
Lawn Care

PERSONAL BUDGET UTILITIES CATEGORIES

You can’t live without your water and electricity.  It is essential that you don’t leave any of these off of your budget either!  These are some of the basic budget categories most people will not intend to forget, but just might.

Electricity
Water
Gas/Oil
Sewer
Trash
Cable/Satellite/Streaming Services
Internet (if not part of your cable bill)
Phone

Read more:  How to Lower Your Utility Bills

FOOD

You have to eat. There are only two ways that happens  — you cook or you eat out. Make sure you include both of these categories in your budget.

Groceries
Dining Out

TRANSPORTATION CATEGORIES

You have to be able to get around.  That doesn’t always mean a vehicle as it could mean using other means of transportation.  Whatever method you use, make sure you include all of those expenses in your budget.

Remember that you may not have to pay for some of these items each month, but it is essential you budget for them monthly so that the funds are available when needed.

Vehicle payment (make sure you include all payments for all vehicles)
Fuel
Insurance
Taxes
Tags/Licensing
Maintenance
Parking Fees
Taxi/Bus Fares

CLOTHING

A line item many people leave off of their budget is clothing.  They forget that it is a necessary expense.  While this doesn’t mean you should go and buy new clothes all of the time, it does allow you to replace items which are worn out.

It is also essential that parents include this item as kids need clothes a bit more frequently.

Adult Clothing
Kids Clothing

CATEGORIES FOR HEALTH

Don’t forget your health expenses when determining a budget.  Make sure you include the money you pay towards your co-pays during the year.

Health Insurance
Dental Insurance
Eye Insurance
Doctor Visits
Dental Visits
Optometrist
Medications
Deductible Savings

PERSONAL ITEMS CATEGORIES

Personal is a “catch-all” category which may contain much of your discretionary spending!  Some of the most common types you need to include:

Haircuts/Manicures/Pedicures
Life Insurance
Child Care/Babysitting
Toiletries (if not included in your grocery budget above)
Household Items (if you did not already include in your groceries budget above)
Education/Tuition
Dry Cleaning/Laundry
School Dues/Supplies
Magazines
Gym Memberships
Organization Dues
Postage
Pet Care (food, grooming, shots, boarding)
Photos (school and family photos)
Random Spending (always useful as a way to pay for the things you may not have broken out in your budget)

RECREATION

We all love to spend some time doing things we love.  Don’t forget to include your entertainment category when determining your budget.

Entertainment (movies/concerts)
Crafts
Hobbies
Parties
Vacations

DEBTS

Once you pay off your debt, these will go away entirely and will no longer be needed.  You can learn how to get out of debt and get started with that (once you have your budget).

Credit Cards (all debt)
Unsecured loans
Home equity loans
Student loans
Medical loans

Now you have the categories you need for your budget!  Take the first step in getting control of your finances by putting this to work for you.

caclulator on desk to figure budget categories

caclulator on desk to figure budget categories

Source: pennypinchinmom.com

Cash Back

How Long Will My Savings Last?

If only we had access to a reliable crystal ball, how simple saving for retirement could be. Instead, the process can feel more like a Magic 8 Ball® inquiry, finding fresh and fleeting new answers to the familiar question “How long will my savings last?”

Telling you to concentrate and ask again, that it is uncertain or better not to tell you are a few ways to answer common queries of this childhood toy, but signs point to yes for a breakdown of the many factors that can impact how long your retirement savings have to go.

What Factors Affect My Retirement Savings?

While it isn’t always easy to save money in your 20s, when many workers might still be paying off student loan debt, starting to save for retirement sooner than later could mean hundreds of thousands more in accumulated investments when it’s time to retire.

There are a few other variables that can come into play when deciding how long retirement savings might last:

Retirement Plan Type

Whether it’s a defined benefit plan like a pension, or a defined contribution plan like an employer-sponsored 401(k), 403(b), or 457, the kind of account you contribute to will likely have an impact on how much and what method you use to save for retirement:

Pension Plan

With a pension plan, retirement income is usually based on an employee’s longevity with the company, how much was earned, and their age at the time of retirement. Pensions can be a reliable retirement savings option because they reward long-term employees with a regular payment, typically once per month. One potential downside, however, is that pension plans can be terminated if a company is acquired, goes out of business, or decides to update or suspend its employee benefits offerings.

401(k) Plan

With a 401(k) plan, participants can contribute either a percentage of or a predetermined amount from each paycheck, and it might be matched by their employer up to a certain amount. Unlike a pension plan, the amount of retirement funds the participant saves is based on how much they personally contributed, whether they received an employer match, the rate of return on their investments, and how long they’ve had the plan.

IRA or Roth IRA

An Individual Retirement Account (or sometimes Arrangement), or IRA, is a retirement account that’s not sponsored by an employer. There are no income limits for a Traditional IRA (outside of tax deductible contributions), so it can be an appealing savings option for people who haven’t quite crystallized how high their earnings could go. A Roth IRA, on the other hand, has limits on contributions based on filing status and income level.

Less Common Plans

Other types of retirement plans like Employee Stock Ownership Plans (ESOP) and Profit Sharing Plans are less common and have their own unique benefits, drawbacks, and details.

Social Security

Social Security is a federally run program used to pay people aged 65 or older a continuing income. If eligible for the funds, they could be used to supplement or sustain savings in retirement.

Expected Rate of Return On Investments

If a person puts money into a defined contribution plan or makes investments in stocks, bonds, real estate, or other assets, there are a number of return outcomes that could affect their retirement savings.

An investment’s performance is about more than just appreciation over time. Learning how to calculate the expected rate of return on the investment can help you get a clearer picture of what the payoff will look like when it’s time to retire.

Unexpected Expenses

One never really knows what retired life might bring. Lots of unexpected expenses could arise.

An extensive home repair or renovation or maybe even a costly relocation to another state or country might make an unforeseen dent in retirement funds.

A major medical incident or the factoring in of long-term care can be another unexpected expense, as are caregiver costs if you or a family member need help.

Some seniors are surprised to learn that health care can get costly in retirement and Medicare may not always be free. Many of the services they might need could require out-of-pocket payments that eat into savings
As much as we might not want to imagine such scenarios, there could be the chance of a divorce during retirement, which could cause a redraft of the savings plan.

Creating a budget to estimate expenses is a great way to get ahead of any surprising financial setbacks that could sneak up down the line.

Inflation

Inflation can take a hefty toll on retirement savings. Even average rates of inflation might have a significant impact on how much retirement funds will actually be worth when they’re withdrawn. For example, $1,500 in January 2000 had the same buying power as $2,293.68 in March of 2020.

Understanding how inflation can affect your retirement savings might ensure you have enough funds padded out to support you for the long haul.

Market Volatility and Investment Losses

Regardless of financial situation or age, checking in on retirement accounts and the climate on Wall Street could help clarify how market swings might affect your retirement savings.

Retirees with defined contribution plans might suffer financial losses if they withdraw invested funds during a volatile market. Not panicking and having enough emergency funds to cover 3-6 months of living expenses can help you weather the storm. Talking to an investment advisor about rebalancing a portfolio to reduce risk is another option for getting ahead of this unexpected savings speedbump.

Ways to Calculate How Much You Might Need to Retire

Are you on track for retirement? That’s something that can be calculated in many ways, which vary in efficacy depending on who you ask.

Here are a few formulas and calculations you can use to consider how much to save for retirement:

The Four Percent Rule

The Four Percent Rule, first used by financial planner William Bengen in 1994, assesses how different withdrawal rates can affect a person’s portfolio to ensure they won’t outlive the funds. According to the rule , “assuming a minimum requirement of 30 years of portfolio longevity, a first-year withdrawal of 4 percent, followed by inflation-adjusted withdrawals in subsequent years, should be safe [for retirement].” Bengen has since adjusted the rule to 4.5% for the first year’s withdrawal.

The jury is out on whether 4% is a safe withdrawal rate in retirement, but many people have used it to weather poorly performing stock markets.

Fidelity also recommends withdrawing 4% to 5% from retirement savings yearly, with adjustments for inflation.

The Multiply by 25 Rule

This one can get a little controversial, but the Multiply by 25 rule, which expanded upon Bengen’s 4% Rule with the 1998 Trinity Study , involves taking a “hoped for” annual retirement income and multiplying it by 25 to determine how much money would be needed to retire.

For example, if you’d like to bring in $75,000 annually without working, multiply that number by 25, and you’ll find you need $1,875,000 to retire. That figure might seem scary, but it doesn’t factor in alternate sources of income like Social Security, investments, etc.

This rule has been banked on by many retirees. However, it’s based on a 30-year retirement period. For those hoping to retire before the age of 65, this could mean insufficient funds in the later years of life.

The Replacement Ratio

The Replacement Ratio helps estimate what percentage of someone’s pre-retirement income they’ll need to keep up with their current lifestyle during retirement.

The typical target in many studies shows 70-85% as the suggested range, but variables like income level, marital status, homeownership, health, and other demographic differences all affect a person’s desired replacement ratio, as do the types of retirement accounts they hold.

Also, the Replacement Ratio is based on how much a person was making pre-retirement, so while an 85% ratio might make sense for a household bringing in $100,000 to $150,000 per year, a household with higher earnings—say $250,000—might not actually need $212,000 each year during retirement. A way to supplement this calculation could be to estimate how much of your current spending will stay the same during retirement.

Social Security Benefits Calculator

By entering the date of birth and highest annual work income, the Consumer Financial Protection Bureau’s Social Security Calculator can determine how much money you might receive in estimated Social Security benefits during retirement.

Other Factors To Calculate

Expected Rate of Returns

Determining the rate of return on investments in retirement can help clarify how long your savings could last. An investment’s expected rate of returns can be calculated by taking the potential return outcomes, multiplying them by the likelihood that they’ll occur, and totaling the results.

Here’s an example: If an investment has a 50% chance of gaining 30% and a 50% chance of losing 20%, the expected rate of returns would be 50% ⨉ 30% + 50% ⨉ 20%, which is an estimated 25% return on the investment.

Home Improvement Costs

If a renovation is looking like it will be necessary down the line, you might calculate how much that home repair project could cost and factor it into your retirement planning.
Inflation

You might also consider using an inflation calculator to uncover what your buying power will really be worth when you retire.

Making Retirement Savings Last Longer

If you’re still wondering how long your savings will last or seeking potential ways to make it last longer, a few of these strategies could help:

Lower Fixed Expenses

Unexpected expenses are likely to creep up regardless of how much you save, but by lowering fixed expenses like mortgage and rent payments, food, insurance, and transportation costs, you might be able to slow the spending of your savings over time. Setting a budget is a solid way to see this in black and white.

Maximize Social Security

While opting into Social Security benefits immediately upon eligibility at 62 might sound appealing, it could significantly reduce the benefit over time. With smaller cost of living adjustments later in life, a lengthy retirement (people are living longer than ever before) could mean less money when you need it the most.

Stay Healthy

Unexpected medical expenses might still occur, but by safeguarding health and wellbeing earlier in life, you could avoid costly chronic conditions like high blood pressure, diabetes, or heart disease.

Keep Earning

Whether it’s staying in the full-time workforce for a couple more years or starting a ride-share side hustle during retirement, continuing to bring in money can help you stretch your savings out a little longer.

Get Good Advice

Financial planning can get even more complicated during retirement. Finding someone who’s smart, qualified, and reliable for advice on the available options is one way to help stay on course with retirement goals and make your retirement savings last as long as possible.

When it comes to planning for retirement, your future doesn’t have to be quite so uncertain. By talking to a real, human advisor about the many factors that impact how long your savings will last, you might settle on exactly what you need to set aside to get you there.

SoFi Invest® gives members free access to financial advisors available to talk about your big picture financial goals—like saving up for retirement or the path that leads you there.

Learn how SoFi Invest® can help you save for retirement.


SoFi Invest®
The information provided is not meant to provide investment or financial advice. Investment decisions should be based on an individual’s specific financial needs, goals and risk profile. SoFi can’t guarantee future financial performance. Advisory services offered through SoFi Wealth, LLC. SoFi Securities, LLC, member FINRA / SIPC . The umbrella term “SoFi Invest” refers to the three investment and trading platforms operated by Social Finance, Inc. and its affiliates (described below). Individual customer accounts may be subject to the terms applicable to one or more of the platforms below.

External Websites: The information and analysis provided through hyperlinks to third party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
Third Party Brand Mentions: No brands or products mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third party trademarks referenced herein are property of their respective owners.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
Investment Risk: Diversification can help reduce some investment risk. It cannot guarantee profit, or fully protect in a down market.
Disclaimer: The projections or other information regarding the likelihood of various investment outcomes are hypothetical in nature, do not reflect actual investment results, and are not guarantees of future results.
SOIN20093

Source: sofi.com

Budgeting, Cash Back

How to Balance Your Life and Budget: 12 Tips to Stay Organized

Life’s a juggling act. You could be building your career, spending time on hobbies, and making time for those you love all at once. Finding a healthy way to navigate all three can be a hard code to crack. Often, one aspect of your life ends up taking more resources than the rest. While hustling your way to the top is good for your career and earnings, you may find yourself out of balance with your health or family. Ultimately, an unbalanced schedule can result in exhaustion, stress, and even burnout.

Learn how to balance your life, career, and budget while reaching your biggest goals. You’ll be working smarter, not harder — here’s how.

make-your-money-work-for-you

How to Balance Your Budget

Balancing your budget is essential for financial success. When you’re free of financial burden, it’s easier to feel relaxed and in control of your life. There are a few tricks to finding a budgeting rhythm that works for you — using a budgeting app is a great place to start.

1. Simplify Your Budget

Make budgeting easy by investing in what you love and saving on what you don’t. Start by downloading our app and tracking your earnings and expenses. Then, see what unnecessary expenses you can cut out. You may love eating out with your friends, but to avoid racking up a hefty bill, limit eating out to once a week.

2. Budget for Extra Expenses

It’s not sustainable to only spend money on things you need. Being strict with your budget could send you into a shopping spiral. There are times when you want to buy a new pair of shoes or eat out with your friends. If you have the money to do so, treat yourself without going overboard by sticking to your budget. Once you find a budget that works for you, set aside a specific amount to spend on extras.

3. Automate What You Can

Make your money work for you without thinking about it. Set a budget and try it out for a few months — adjust as needed. For example, if you feel like you always go over your grocery budget but you never use all of your gas money, reallocate those funds. Once you have all the kinks worked out, set up automatic payments for recurring expenses such as savings account contributions, debt payments, and living expenses. You won’t have to worry about missing a payment or creating a new budget every month.

4. Follow Trusted Financial Gurus

Weed through your social media feeds. Do you follow people that have a bad influence on your spending habits? How about financial experts that help you manage your money? Every month, sift through who you follow and remove accounts that negatively impact your money habits. It’s always a good idea to follow accounts that have a positive effect. For example, Mint’s Instagram account could be the right influence for you!

work-smarter-not-harder

How to Balance Your Work and Personal Life

Working is what helps you pay your bills and live the life you want. But it can easily fill your schedule if you’re overly invested. Whether you work from home or an office, it’s important to make time for things you love — whether it be your family, friends, hobbies, or all three.

5. Set Boundaries In and Out of the Office

When you’re at work, stay focused on work. When you’re at home, stay focused on your loved ones, hobbies, or relaxing. If the lines get blurred, set rules for you and your loved ones. Turn off your work notifications after hours to avoid interference. When you’re working, silence your phone to steer clear of distractions and stay in your workflow. You may find yourself more productive and with extra time to take on more tasks — this could help you earn that promotion.

6. Prioritize Your Time

It’s hard to make time for everything you want to do. Lessen stress by prioritizing your time like you would your budget. List your most important tasks for the next day, followed by your lower priorities. Reference your list throughout the day to help you stay focused on what you need to do. This method saves you time and energy preparing for the day ahead.

7. Make Your Workplace Work for You

To set yourself up for success, start with your work environment. Get focused by creating different “zones” in your home or office. Section off places for working, eating, relaxing, and sleeping. Working in bed feels comfortable, but lacks balance. You could find yourself online shopping over focusing on your work task at hand.

8. Schedule Daily “You” Time

Having back-to-back meetings, tasks, or events can drain your energy, especially if the majority of your time is being spent on things you’re not passionate about. Create time for you by putting it on the calendar. Find a few times that work for your schedule and add in non-negotiable breaks. For example, block off your lunch break to check in on your budget.

health-is-wealth

How to Balance a Healthy Lifestyle

Having a balanced lifestyle is essential for your mental and physical health. No matter what, there’s always someone to respond to or something to do. If you’re the “yes” person, it’s easy to spread yourself too thin. Instead of taking on every burden thrown at you, here are some tips on how to hit pause and put yourself first.

9. Eliminate Negativity

Filter through your lifestyle stressors by having honest conversations with yourself and others. Do you have friends that don’t positively impact your life? Or do you have a job that doesn’t bring you joy? If so, it may be time to cut ties with negative people or situations. Having relationships that don’t make you happy could influence bad purchasing decisions or habits.

10. Make Time for What You Love

During your free time, what do you do for fun? Working out, going on long walks, curling up with a good book, or anything else that brings you joy. Instead of only enjoying your favorite activities only on the weekends, add them to your daily routine. Make room in your budget for your favorite things throughout the work week.

11. Listen to Your Body

Some days you feel happy and ready to take on tasks thrown your way; other days you’re overwhelmed when it comes to meeting expectations. Fluctuations in your mood are normal! It’s how you handle them that makes the biggest impact. If you’re feeling down, listen to your body and treat yourself to a relaxing self-care evening that’s easy on your budget.

12. Be Patient With Yourself

Know we all have our good and bad days. Instead of being hard on yourself for a day gone sour, list out things you can do to prepare for the future. For example, you may have had a bad day at work. Take some time, stay calm, and brainstorm what you could have done differently in the situation. As you learn from your mistakes, you’ll grow into your career and potentially earn a promotion.

are-you-living-life-unbalanced

This process may entail establishing new habits and breaking old ones. In most cases, updating your daily habits takes time. Be patient with yourself and your budget as you seek balance. It isn’t always as easy as it sounds, but could save you daily stress.

Sources: The U.S. Sun | World Population Review | Stress | U.S. Travel

Learn more about security

Mint Google Play Mint iOS App Store

Source: mint.intuit.com

Cash Back

Instacart Layoffs: Here’s What the Cuts Mean for Your Side Gig

An Instacart worker shops for corn inside a grocery store.

Instacart worker Saori Okawa shops for produce for a delivery in San Leandro, Calif. Instacart plans to lay off nearly 2,000 employees as it shifts away from having shoppers inside grocery stores. Ben Margot/AP Photo

Grocery delivery service Instacart is laying off nearly 2,000 employees in the coming months as it shifts away from having shoppers embedded in stores.

Instacart unveiled the shift to a new “Partner Pick” model in a post on Medium. Under that model, Instacart will rely more on grocery store employees to fulfill orders. The announcement didn’t say how many in-store shoppers are being laid off, but CBS News reported that 1,877 Instacart employees who work embedded in grocery stores across the country will lose their jobs by March.

Going forward, grocery store employees will play a larger role in preparing pickup orders that customers place through the Instacart app. The result is that the current in-store Instacart employees will no longer be needed at many locations.

What Do the Instacart Layoffs and Changing Services Mean for Your Side Gig?

The March 2021 wave of layoffs is primarily focused on one of the two major side gigs Instacart offers: in-store shoppers. The other major side gig, full-service shopping, is indirectly affected.

In-store shoppers are W-2 employees of Instacart, and they work embedded in partner grocery stores around the country. Typically, they shop and prepare orders for pickup — either by a customer or an Instacart delivery driver who then takes the order directly to the customer’s doorstep.

As of March 2020, Supermarket News reported the company employs about 12,000 in-store shoppers. The layoffs mark an estimated 15% reduction in these types of jobs.

“We know this is an incredibly challenging time for many as we move through the COVID-19 crisis, and we’re doing everything we can to support in-store shoppers through this transition,” Instacart said in an emailed statement to The Penny Hoarder. “We’re also providing all impacted shoppers with separation packages based on their tenure with Instacart.”

Instacart did not clarify whether it plans to cut more in-store shopper positions in the future as the company continues to implement its new Partner Pick model.

The cuts have a rippling effect on the more popular grocery-delivery gigs, known as full-service shoppers. These positions are 1099 independently contracted roles. The folks who work these app-based gigs are not employees of Instacart, technically speaking. The “full-service” part generally refers to the grocery shopping and delivery responsibilities.

Pro Tip

1099 independent contractors aren’t eligible for standard W-2 employee benefits or workplace protections, including health insurance, workers compensation, paid time off and more.

Throughout the pandemic, hundreds of thousands of people have supplemented their income with Instacart’s flexible delivery gigs.

Soon, full-service gig workers will start taking over the new shopping-only orders that will become available on the Instacart worker app.

“As part of this pilot, full-service shoppers at select retailer locations will be able to choose orders to pick, pack and stage — no delivery required,” Instacart said in an announcement.

The company did not share when the new type of orders will go into effect for gig workers.

In an announcement following the news of the Instacart layoffs, Kroger — a grocery chain that partners with Instacart — said it had no part in the decision to cut the in-store shoppers working at its locations. The grocer welcomed affected shoppers to apply to a host of job openings.

In a statement to CBS, Kroger said: “For those who are looking for a career opportunity, we have thousands of retail roles available on jobs.kroger.com.”

Adam Hardy is a staff writer at The Penny Hoarder. He covers the gig economy, remote work and other unique ways to make money. Read his ​latest articles here, or say hi on Twitter @hardyjournalism.

<!–

–>



Source: thepennyhoarder.com