Category Archives: Budgeting

Budgeting Tips for the Sandwich Generation: How to Care for Kids and Parents

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Everyone knows that raising kids can put a serious squeeze on your budget. Beyond covering day-to-day living expenses, there are all of those extras to consider—sports, after-school activities, braces, a first car. Oh, and don’t forget about college.

Add caring for elderly parents to the mix, and balancing your financial and family obligations could become even more difficult.

“It can be an emotional and financial roller coaster, being pushed and pulled in multiple directions at the same time,” says financial life planner and author Michael F. Kay.

The “sandwich generation”—which describes people that are raising children and taking care of aging parents—is growing as Baby Boomers continue to age.

According to the Center for Retirement Research at Boston College, 17 percent of adult children serve as caregivers for their parents at some point in their lives. Aside from a time commitment, you may also be committing part of your budget to caregiving expenses like food, medications and doctor’s appointments.

Budgeting tips for the sandwich generation include communicating with parents.

When you’re caught in the caregiving crunch, you might be wondering: How do I take care of my parents and kids without going broke?

The answer lies in how you approach budgeting and saving. These money strategies for the sandwich generation and budgeting tips for the sandwich generation can help you balance your financial and family priorities:

Communicate with parents

Quentara Costa, a certified financial planner and founder of investment advisory service POWWOW, LLC, served as caregiver for her father, who was diagnosed with Alzheimer’s disease, while also managing a career and starting a family. That experience taught her two very important budgeting tips for the sandwich generation.

First, communication is key, and a money strategy for the sandwich generation is to talk with your parents about what they need in terms of care. “It should all start with a frank discussion and plan, preferably prior to any significant health crisis,” Costa says.

Second, run the numbers so you have a realistic understanding of caregiving costs, including how much parents will cover financially and what you can afford to contribute.

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17 percent of adult children serve as caregivers for their parents at some point in their lives.

– The Center for Retirement Research at Boston College

Involve kids in financial discussions

While you’re talking over expectations with your parents, take time to do the same with your kids. Caregiving for your parents may be part of the discussion, but these talks can also be an opportunity for you and your children to talk about your family’s bigger financial picture.

With younger kids, for example, that might involve talking about how an allowance can be earned and used. You could teach kids about money using a savings account and discuss the difference between needs and wants. These lessons can help lay a solid money foundation as they as move into their tween and teen years when discussions might become more complex.

When figuring out how to budget for the sandwich generation, try including your kids in financial decisions.

If your teen is on the verge of getting their driver’s license, for example, their expectation might be that you’ll help them buy a car or help with insurance and registration costs. Communicating about who will be contributing to these types of large expenses is a good money strategy for the sandwich generation.

The same goes for college, which can easily be one of the biggest expenses for parents and important when learning how to budget for the sandwich generation. If your budget as a caregiver can’t also accommodate full college tuition, your kids need to know that early on to help with their educational choices.

Talking over expectations—yours and theirs—can help you determine which schools are within reach financially, what scholarship or grant options may be available and whether your student is able to contribute to their education costs through work-study or a part-time job.

Consider the impact of caregiving on your income

When thinking about how to budget for the sandwich generation, consider that caring for aging parents can directly affect your earning potential if you have to cut back on the number of hours you work. The impact to your income will be more significant if you are the primary caregiver and not leveraging other care options, such as an in-home nurse, senior care facility or help from another adult child.

Costa says taking time away from work can be difficult if you’re the primary breadwinner or if your family is dual-income dependent. Losing some or all of your income, even temporarily, could make it challenging to meet your everyday expenses.

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“Very rarely do I recommend putting caregiving ahead of the client’s own cash reserve and retirement.”

– Quentara Costa, certified financial planner

When you’re facing a reduced income, how to budget for the sandwich generation is really about getting clear on needs versus wants. Start with a thorough spending review.

Are there expenses you might be able to reduce or eliminate while you’re providing care? How much do you need to earn each month to maintain your family’s standard of living? Keeping your family’s needs in focus and shaping your budget around them is a money strategy for the sandwich generation that can keep you from overextending yourself financially.

“Protect your capital from poor decisions made from emotions,” financial life planner Kay says. “It’s too easy when you’re stretched beyond reason to make in-the-heat-of-the-moment decisions that ultimately are not in anyone’s best interest.”

Keep saving in sight

One of the most important money strategies for the sandwich generation is continuing to save for short- and long-term financial goals.

“Very rarely do I recommend putting caregiving ahead of the client’s own cash reserve and retirement,” financial planner Costa says. “While the intention to put others before ourselves is noble, you may actually be pulling the next generation backwards due to your lack of self-planning.”

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Making regular contributions to your 401(k), an individual retirement account or an IRA CD should still be a priority. Adding to your emergency savings each month—even if you have to reduce the amount you normally save to fit new caregiving expenses into your budget—can help prepare you for unexpected expenses or the occasional cash flow shortfall. Contributing to a 529 college savings plan or a Coverdell ESA is a budgeting tip for the sandwich generation that can help you build a cushion for your children once they’re ready for college life.

When you are learning how to budget for the sandwich generation, don’t forget about your children’s savings goals. If there’s something specific they want to save for, help them figure out how much they need to save and a timeline for reaching their goal.

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Ask for help if you need it

A big part of learning how to budget for the sandwich generation is finding resources you can leverage to help balance your family commitments. In the case of aging parents, there may be state or federal programs that can help with the cost of care.

Remember to also loop in your siblings or other family members when researching budgeting tips for the sandwich generation. If you have siblings or relatives, engage them in an open discussion about what they can contribute, financially or in terms of caregiving assistance, to your parents. Getting them involved and asking them to share some of the load can help you balance caregiving for parents while still making sure that you and your family’s financial outlook remains bright.

The post Budgeting Tips for the Sandwich Generation: How to Care for Kids and Parents appeared first on Discover Bank – Banking Topics Blog.

Source: discover.com

How Much Should You Spend on an Engagement Ring?

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How Much Should You Spend on an Engagement Ring?

There’s nothing like falling in love and finding the person you want to spend the rest of your life with. But when it’s time to shop for rings, it’s easy to get discouraged by the price tags. Just how much should you spend on an engagement ring? We’ll dive into the topic and discuss ways to save on the big purchase.

Find out not: How much do I need to save for retirement?

What the Average Engagement Ring Costs

Maybe you can’t buy love. But if you’re in the market for an engagement ring, you’ll quickly realize that it won’t be cheap. According to the Knot’s 2016 Real Weddings Study, Americans spent an average of $6,163 on engagement rings, up from $5,871 in 2015. Wedding bands for the bride and engagement rings combined cost between $5,968 and $6,258.

If you want your wedding to happen sooner rather than later, keep in mind that on average, couples spend more than $30,000 to tie the knot. That’s roughly how much you can expect to pay for everything from your wedding reception and DJ to your cake and your photographer. Location matters when it comes to weddings, however, so you might be able to save some money by choosing a more affordable place to host your ceremony.

How Much Should I Spend?

How Much Should You Spend on an Engagement Ring?

Conventional wisdom says that anyone planning to propose to their partner should prepare to spend at least two or three months of their salary on an engagement ring. But spending too much isn’t a good idea for various reasons.

A recent study conducted by Emory University connected pricey rings to divorce rates. Men who spent more money on rings for their fiancees were more likely to end their marriages. That’s a possible long-term consequence of overspending on an engagement ring. In the short term, using a large percentage of your money to buy a ring might prevent you from using those funds to pay bills or stay on top of your debt, which can hurt your credit score.

If the marriage doesn’t work out and your ex-spouse decides to sell their diamond engagement ring, its value won’t be nearly as high as it was when it was first purchased. That’s why diamond rings can be such bad investments.

So exactly how much should you spend on an engagement ring? It’s a good idea to make sure that the price you pay doesn’t prevent you or your partner from accomplishing whatever you’re planning to achieve in the future, whether that’s buying a house or having a child. Rather than following an old-school societal notion that says you should spend x amount of money on a ring, it’s best to spend an amount that won’t compromise your financial goals or jeopardize the status of your relationship.

How to Save on the Ring

If you don’t want the engagement ring you’re buying to break the bank, it’s a good idea to learn as much as you can about the rings and what makes some more expensive than others. Diamonds are the gems most commonly used in engagement rings, and if you’re buying one for your significant other, it’s important to familiarize yourself with what jewelers refer to as the four C’s: clarity, cut, color and carat weight.

In terms of clarity, the best diamonds are flawless, meaning that they don’t have any blemishes when viewed under a microscope with 10 power magnification. Since no one’s eyesight is that powerful, you can get away with choosing a diamond with a lower clarity grade that costs less. Getting a diamond that has fewer carats (meaning that it weighs less) or getting one that isn’t completely colorless can also lower its overall price.

Or don’t get a diamond at all. Your partner might be just as happy with a simple band, a white sapphire or an emerald ring and it probably won’t cost as much as a diamond engagement ring. Shopping for your ring at a vintage store, looking for one online rather than in-person and getting a ring with a series of smaller stones surrounding the center stone (also known as a halo ring) are a few additional ways to save when buying a ring.

Final Word

How Much Should You Spend on an Engagement Ring?

There’s no need to spend a fortune on an engagement ring. And you don’t have to feel guilty about cutting corners in order to find one that you can afford to buy.

Like any other major purchase, it’s a good idea to take time to save up for a ring. If you have to take on more credit card debt or a personal loan in order to buy an engagement ring, it’s a good idea to find out how long it’ll take to pay off your debt. It isn’t wise to begin a marriage by digging yourself (and your partner) into a deep financial hole.

Tips for Getting Financially Ready for Marriage

  • If you haven’t already, start talking about money. It’s important to establish an open dialogue and make sure you understand and respect each other’s money values.
  • You might also consider sit down with a financial advisor before the big day. A financial advisor can help you identify your financial goals and come up with a financial plan for your life as a married couple. A matching tool (like ours) can help you find a person to work with to meet your needs. First you’ll answer a series of questions about your situation and goals. Then the program will narrow down your options from thousands of advisors to three fiduciaries who suit your needs. You can then read their profiles to learn more about them, interview them on the phone or in person and choose who to work with in the future. This allows you to find a good fit while the program does much of the hard work for you.

Photo credit: ©iStock.com/sergey_b_a, ©iStock.com/svetikd, ©iStock.com/adamkaz

The post How Much Should You Spend on an Engagement Ring? appeared first on SmartAsset Blog.

Source: smartasset.com

5 Steps to Take When Budgeting for a Career Break

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Not everyone’s career path is a 40+ year marathon working full time until you can finally come up for air in your golden years.

Sometimes you need a little break along the way.

Taking time away from the workforce — whether it’s to travel, take care of loved ones, learn a new skill or whatever — can be a beneficial thing. But money — or the lack thereof — is what stops many people from even considering it.

With some significant planning and budgeting, however, it’s possible to make your career break dreams a reality. Here are five steps you should take when budgeting for a career break.

5 Steps for Career Break Budgeting

1. Think About What Your Career Break Will Look Like

People take career breaks for a number of reasons. Take some time to reflect on why you are planning time away from the workforce and what you intend to do.

When thinking about what your new day-to-day will look like, try to get as detailed as possible. Hone in on aspects that will affect you financially.

How long will your break last? When would you like it to start? Will you be staying at home or traveling the world? What adventures would you like to experience?

While it’s nice to dream about your best life ever, you’ve got to be practical too. Ranking what you want to do with your newfound free time will be helpful if you have to cut your list down to fit what you can afford.

2. Explore What Your Costs Will Be During Your Break

After you’ve fantasized what your work break will look like, it’s time to focus on the numbers. You’ve got to know what your expenses will be in order to determine whether your plans are realistic.

If you don’t already budget your income and track your expenses, now’s the time to start. Your budget will give you a good idea of how much you spend on essentials and where you can cut costs as you save up for leave.

Research all the additional costs you expect to incur during your break. If you’re taking extended parental leave after the birth of a child, you’ll be dealing with a ton of new baby-related expenses. If you’re taking time off to travel, you’ve got to pay for transportation and lodging.

The length of your break will also be a big factor here. Obviously, the longer you’re away from the workforce, the more money you’ll need saved up.

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3. Set Up a Sinking Fund to Cover Expenses on Your Break

If you haven’t heard the term “sinking fund,” that’s just personal-finance speak for a stash of savings that you regularly contribute to over time to break up a big expense.

Once you’ve estimated the overall expenses for your leave, divide that by how many months you have left to come up with your target monthly savings goal.

Pro Tip

Switch to a bare-bones budget or try these other ways to save money fast so you can free up cash to add to your sinking fund.

If you already have existing savings you want to use to fund your career break, that will cut down on how much you’ll need to put aside each month — just make sure you don’t touch your emergency fund!

Your emergency savings should only be used on an actual emergency — like if you get into a car accident or Fido needs to be rushed to the pet hospital. Being away from work won’t make you immune to emergencies, so do not plan to use your emergency fund to tide you through your break.

In fact, before you focus on building up your sinking fund, you ought to have adequate savings in an emergency fund first.

A woman helps her mother up from a chair outside in their garden.

4. Explore Opportunities to Make Money On Your Break

If you’re able to make money while you’re away from work, you’ll be less financially burdened. You won’t have to save up as much or worry about burning through your entire savings.

The first income stream you should explore is your current job. Taking a career break doesn’t necessarily mean calling it quits where you work now.

Depending on what type of leave you’re taking, your job may be protected and you might be able to continue collecting your salary — or a percentage of your current pay.

The Family and Medical Leave Act (FMLA) provides eligible workers with up to 12 weeks of leave after the birth or adoption of a child, to deal with a serious health condition or to care for an ill or injured family member. While this type of leave is unpaid, you’ll continue to be covered under their workplace health insurance plan and there may be the possibility of coupling this leave with short-term disability pay.

Pro Tip

President Joe Biden’s proposed coronavirus stimulus package includes extending the expired paid time off policies for sick workers and those needing to care for family members due to COVID-19.

Find out if your employer offers any other paid leave programs — whether that’s parental leave, unlimited PTO or sabbaticals. According to the Society for Human Resource Management’s 2019 Employee Benefits Survey, 27% of employers offered paid parental leave, 6% offered unlimited paid leave and 5% offered a paid sabbatical program.

Another 11% of employers surveyed offered an unpaid sabbatical program. While unpaid leave isn’t as ideal as paid leave, it gives you peace of mind that you’ll have a job to come back to after your break.

Other options to make money during your leave include picking up a side gig, bringing in passive income, renting out rooms (or your entire place) on Airbnb or selling your belongings.

If you need to pick up a little work while you’re on a career break, just make sure it doesn’t conflict with the reason you needed to take leave in the first place.

5. Develop a Re-Entry Plan

You need to plan for all aspects of your career break — including your transition back to the workforce.

Your budget needs to not only cover your expenses while you’re backpacking through Europe or nursing your elderly mother back to health. You’ve got to add a cushion for that period at the end where you’re actively seeking your next gig.

While data from the U.S. Bureau of Labor Statistics shows the average length of unemployment is about 23 weeks, how long it’ll take you to find new work will vary depending on your industry and the position you’re seeking.

Plan to keep up with contacts in your field and engage in relevant volunteer work or continued education while you’re away to improve your chances of quickly finding a new job.

If your savings run low toward the end of your leave, don’t brush off finding a bridge job — a temporary role to help you pay the bills while you search for better opportunities.

Pro Tip

A resume gap isn’t the kiss of death it used to be. You can even craft a way to include side gigs on your resume.

A career break should provide you with freedom to pursue something outside of your typical work life. You don’t want that freedom to drag you deeper into debt or put you in a worse financial position if you can avoid it.

Do your best to budget for more time than you’ll need so you can enjoy your career break stress free.

Nicole Dow is a senior writer at The Penny Hoarder.

This was originally published on The Penny Hoarder, which helps millions of readers worldwide earn and save money by sharing unique job opportunities, personal stories, freebies and more. The Inc. 5000 ranked The Penny Hoarder as the fastest-growing private media company in the U.S. in 2017.

Source: thepennyhoarder.com

Budgeting Help

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How Mint offers budgeting help

Ready to start budgeting and tracking your money? See our article Budgeting Tips from Mint — and subscribe to our blog for more budgeting help.

Budgeting Calculators

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How Much do I Need for Emergencies? Saving enough money for emergencies is the first step in setting a budget. Don’t be caught by surprise. How much do you need in your emergency fund?

How Much Should I Save to Reach my Goal? Are you budgeting for a house, vacation or retirement? Quickly find out if you’re saving enough to reach your goals on schedule.

Value of Reducing or Foregoing Expenses. Small changes in your daily routine can add up to big budget savings. Find out how much.

How Much Does Inflation Impact my Standard of Living? How much will you need in 5, 10 or 30 years to maintain your standard of living?

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The post Budgeting Help appeared first on MintLife Blog.

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Fed: Credit card balances dipped by $3 billion in December

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Credit card balances edged down in December, even as consumers engaged in holiday shopping, as uncertainty about a second round of stimulus checks extended to the latter part of the month.

Consumer revolving debt – which is mostly based on credit card balances – was down $3 billion on a seasonally adjusted basis in December to $975.9 billion, according to the Fed’s G. 19 consumer credit report released Feb. 5.

In December, credit card balances were off 3.6% on an annualized basis, following November’s revised 0.8% dip and October’s 6.7% drop, which came on the heels of September’s 3.2% annualized gain.

The Fed also reported that student loan debt outstanding for the fourth quarter rose to $1.707 trillion, from the third quarter’s $1.704 trillion. And auto loan debt outstanding gained to $1.228 trillion, from the third quarter’s $1.219 trillion.

Total consumer debt outstanding – which includes student loans and auto loans, as well as revolving debt – continued to grow and rose $9.7 billion to $4.184 trillion in December, a 2.8% annualized gain.

For the entire year, credit card balances were down 11.2%.

Card balances had been growing before the coronavirus impacted consumer spending and bank lending in 2020. They dipped below the $1 trillion mark last May, for the first time since September 2017.

See related: 51% of consumers accrued more debt during the pandemic

ABA sees brighter days ahead for credit availability

The American Bankers Association reports, based on input provided by chief economists of large North American banks to its credit conditions index for the first quarter of 2021, that credit conditions (both credit quality and availability) have rebounded from their lows of last summer.

However, all three components of the index (the headline credit index, the consumer credit index and the business credit index) remain below 50, which is not a robust index reading. It indicates that while bank economists expect credit conditions to remain “soft” in the coming six months, they are less pessimistic than they were in September 2020 when the ABA  conducted its last credit conditions survey.

The consumer credit index component of the survey gained to 45.3, its highest level since mid-2019. Economists are optimistic about both the availability and quality of consumer credit compared to September. They expect credit to be more available to consumers in the coming six months, although a small majority expects credit quality to decline.

“Although credit quality is still expected to worsen over the first half of the year for both consumers and businesses, the overall outlook for credit markets has improved significantly since the summer and fall,” said Rob Strand, ABA senior economist. “As widespread inoculations against the virus and new fiscal stimulus measures help heal the economy, banks will continue to work closely with policymakers, consumers and businesses to ensure that affordable credit remains available and recovery strengthens.”

Fed reports easing of credit card lending standards in fourth quarter

According to the Fed’s senior loan officer opinion survey on bank lending practices for January 2021 (which is based on input related to the fourth quarter of 2020), a “moderate net share of banks” reported that they had eased up on credit card loans.

As a result, a “modest net share of banks” also hiked up their credit limits on credit card accounts. And a “moderate net share of banks” reported that there was higher demand for credit card loans during the fourth quarter.

As for the outlook, a “significant net share of banks” is expected to ease up on their standards for credit card loans. They are doing so in anticipation of an improvement in their loan portfolios’ credit quality, as well as a hike in their tolerance for risk.

Also, the New York Fed’s survey of consumer expectations for December 2020 finds that consumers are less concerned about the possibility of missing a minimum debt payment in the coming three months. The average perceived probability of this occurrence dipped to 10.5% for December, from November’s 10.9%.

See related: What happens when you miss a credit card payment?

Jobs edge up in January

The New York Fed survey also finds that on average fewer consumers expect the unemployment rate to be higher a year from now, with this probability declining to 38.9%, from November’s 40.1%.

While the average perceived probability of losing a job in the coming 12 months rose up a bit to 15% (mainly on account of those without a college degree), respondents were also more likely to leave their job voluntarily. However, they were less optimistic about landing a new job if they lost their current ones.

The U.S employment situation was about stable in January, with the economy adding 49,000 jobs, the government reported Feb. 5. “The labor market continued to reflect the impact of the coronavirus pandemic and efforts to contain it,” according to the Department of Labor’s employment report media release. The unemployment rate dipped 0.4 percentage points to 6.3% and average hourly earnings were up $0.06 to $29.96. Also, the job numbers for both November and December were revised down, with November down 77,000 jobs (to 264,000) and December losing an additional 87,000 jobs (to minus 227,000).

In his daily email commentary, Ian Shepherdson, chief economist at Pantheon Macroeconomics, noted, “Coupled with the -159K net revision, this is a significantly softer report than expected, at least in terms of payrolls. Bulls will cite the large and unexpected drop in the unemployment rate, but two-third(s) of the decline was due to a 405K drop in the size of the labor force – a sign of discouragement – while household employment rose 201K.”

He added that “the labor market was frozen at the start of the year, and is completely dependent on the pace of reopening, which in turn is contingent on the speed and sustainability of the fall in hospitalizations.”

Source: creditcards.com

How to Decide If Pet Insurance Is Worth the Cost

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Woman deciding if pet insurance is worth the cost

Last fall, our greyhound Tivo refused his breakfast on a Friday morning. He didn’t eat or drink water all day, and we were worried. That night, we took him to the 24-hour emergency veterinarian and Tivo was diagnosed with a bacterial stomach bug and dehydration. We went home with antibiotics, a saline IV, and a $200 vet bill.

Thankfully, we could afford this bill for unexpected emergency care for Tivo. But if he were diagnosed with a chronic condition or needed a very costly intervention, we might find ourselves facing some heartbreaking financial decisions.

Pet insurance is often touted as a solution to these worries. With pet insurance covering some costs of veterinary care, you’re never forced to choose between your beloved pet and your finances. However, does this kind of coverage make sense for most pet-owners?

Here’s what you need to know about pet insurance so you can keep your fur babies bright-eyed and bushy-tailed for years to come.

Premium costs

As with human health insurance, pet insurance charges you a monthly premium for your pet’s coverage. According to Value Penguin, the average monthly cost for canine pet insurance is $47.20, and the average for feline insurance is $29.54 for accident and illness coverage.

Of course, this doesn’t tell the whole story of what to expect from premium costs. Many pet insurers increase premiums with the age of your pet. Which means the $47 per month you pay to keep your 4-year-old pup healthy could rise with his/her age, making the premiums harder to keep up with just as they’re more likely to need age-related medical intervention. In addition, different breeds can have different premium prices, since there are some hereditary conditions that various breeds may be more prone to.

However, even with these potential issues, there are some methods to keep premiums manageable. For instance, some tried and true insurance reduction strategies work just as well for your pet’s health insurance as they do for your own. These include increasing your deductible, reducing the percentage that the insurance reimburses, or limiting the annual payout rather than choosing unlimited coverage.

These strategies can keep your premiums affordable while still helping with big veterinary bills. But you need to be prepared to pay anything above and beyond the coverage limits you set up. (See also: 8 Ways to Lower Your Vet Bills) 

Coverage

It’s also important to note that pet insurance does not necessarily cover every kind of health cost for your pets. To start, unlike (some) human health insurance, most pet insurance will not cover preventive care and annual exams. So you will need to plan for these costs on top of your premiums.

Pet insurance policies generally come in two varieties: accident and illness policies, and accident-only policies. In general, accident-only policies do not raise their premiums as your pet ages, making this kind of insurance more affordable long-term. However, accident-only policies tend to be cheaper because your pet is less likely to get injured than fall ill. If you decide to invest in pet insurance, getting both accident and illness protection will likely offer you more protection.

That said, each insurer gets to decide which illnesses, conditions, and services it covers, and not all ailments are covered. Many insurers also do not cover the diagnostic exam for a particular illness, even if the treatments are covered. Make sure you pay attention to the details of what your potential insurer will cover before signing up for coverage.

As with many types of human health insurance, most pet insurance policies exclude preexisting conditions. Unfortunately, some insurers consider health problems to be "preexisting" if they crop up within a year of the purchase of your policy. Insuring your pet when they’re young is the best way to avert the preexisting condition coverage gap.

Finally, pet insurance coverage is usually handled via reimbursement. That means you’ll be on the hook to pay the vet bill at the time of service, and you’ll submit your receipts to your insurer to receive reimbursement. (See also: 7 Things You Need to Know About Pet Insurance)

Should you buy pet insurance?

With all the caveats, coverage gaps, and reimbursement requirements, pet insurance is not necessarily a slam dunk for everyone. In fact, many consumer advocates recommend that pet owners put aside an amount equal to the annual premium into a savings account each year. This will give you the same peace of mind that you can cover any potential health care needs for your pet while also allowing you to keep the money if you never need to use it.

However, if you struggle with financial discipline, this strategy will leave you in a difficult situation if your furry friend needs an expensive procedure. Pet insurance can provide you with the protection your pet needs even if you struggle with money. 

Show your love with an emergency fund

Whether or not you decide to purchase pet insurance, remember that you’ll have to pay upfront for any veterinary procedures. With insurance, you will get reimbursed for covered care, but you will still need to have access to funds to pay for Mittens’ kidney stone removal or Rex’s arthritis care at the time of care.

This means that one of the best ways you can protect your furry friends and avoid heartbreaking financial choices is to have an emergency fund. With or without pet insurance, set some money aside for the unexpected so you can enjoy your four-legged family members for years to come. (See also: 7 Easy Ways to Build an Emergency Fund From $0)

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With pet insurance covering some costs of veterinary care, you're never forced to choose between your beloved pet and your finances. Here's what you need to know about pet insurance. | #pets #petcare #insurance


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How to Maximize Rewards on Everyday Spending

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Woman using credit card on everyday spending

While many rewards enthusiasts focus on signing up for new credit cards to earn signup bonuses, not everyone has the time or desire to play the signup game. There is effort involved in tracking multiple cards, annual fees, and rewards programs, after all, and some people don’t want to spend their time or mental energy this way.

If you’re someone who falls into this category, you may be better off maximizing one or two cards instead of chasing rewards. Fortunately, you can earn plenty of rewards over time if you’re savvy about your card’s benefits and bonus categories.

The key to getting the most out of your rewards cards is understanding how they work and looking for opportunities to earn more points on your everyday spending. Here are some tips that can help.

Brainstorm every bill you could pay with a credit card

Because rewards cards offer points based on each dollar you spend, maximizing the amount you can spend on credit is the best way to boost your rewards haul. The smartest strategy to use here is figuring out how many of your monthly bills you can pay with a credit card.

While you may not be notified or aware, it’s possible that bills you’ve been paying with a check or debit card for years can be paid with a credit card without any fees. While your bills may vary, some expenses you should try to pay with a credit card include:

  • Rent
  • Utility bills like electric or gas
  • Health insurance
  • Cable television and internet
  • Cell phone
  • Taxes
  • Daycare
  • Auto and home insurance
  • Subscription services
  • College tuition or student loans
  • Medical bills
  • Lawn care

Keep in mind that these are just some of the bills you could be paying with credit. Depending on your situation, you could have additional, uncommon expenses to cover that could be paid with credit with ease.

Also, remember that these additional bills should be paid with credit on top of your everyday expenses like groceries, dining out, gas or bus fare, and miscellaneous spending. Every time you buy something in person or online, you should strive to pay with your rewards card if you can.

Leverage your rewards card bonus categories

It’s also important to leverage your favorite card bonus categories, whatever they may be. This is especially important if you have a few cards with different bonus categories since you’ll want to make sure you’re using the right card for bills that let you earn bonus points.

Let’s say you have a travel credit card that earns 3x points on dining and travel and another card that earns 6x points at the grocery store. In that case, you would be smart to use the travel card for dining and travel purchases and your other card when you stock up on food. While the amount of rewards you earn with individual purchases may seem nominal, using the right card for the right purchase can help you earn a lot more rewards over time.

Set up auto-pay bills to be paid with credit

Most of us have bills set up to be paid automatically, whether it’s our Netflix and Hulu subscriptions, gym membership, or utility bills. Make sure each bill you have set up to be paid automatically is set up to be paid with your rewards card and not a debit card. This way, you can earn rewards points on those expenses every month.

Use shopping portals and dining clubs

Many flexible rewards programs, frequent flyer programs, and hotel loyalty programs have shopping portals you can access to earn extra points. Major airlines like American, Delta, and United also have shopping portals that work similarly. (See also: How to Maximize Rewards Through Credit Card Shopping Portals)

Some programs like Southwest and Delta also offer dining clubs. These programs let you earn additional points or miles just for dining at participating restaurants in your area. It’s easy and it’s free to join, so you may as well earn extra miles on your spending if you’re going to dine out anyway. (See also: Everything You Need to Know About Airline Dining Rewards Programs)

How much the average family can earn

If you are skeptical the average family can rack up meaningful rewards without signing up for new cards over and over again, look at how this might work in real life. For example, imagine a family of four with two rewards card-toting adults. Across the two of them, they have:

  • A cash back card that earns 2% back
     
  • A travel credit card that earns 3% on dining and travel
     
  • A rewards card that earns 6% cash back at the grocery store on up to $6,000 in spending each year

To figure out how much this family might earn, we used Bureau of Labor Statistics spending averages from 2017. Here’s a rundown of that data for the year plus how much a family could earn in rewards over 12 months based on average expenses:

  • Food at home ($4,363): $261.78 in rewards at 6%
     
  • Food away from home ($3,365): $100.95 at 3%
     
  • Utilities, fuels, and public services ($3,836): $76.72 at 2%
     
  • Household operations ($1,412): $28.24 at 2%
     
  • Household supplies ($755): $45.30 at 6%
     
  • Household furnishings and equipment ($1,987): $39.74 at 2%
     
  • Apparel and services ($1,833): $36.66 at 2%
     
  • Gasoline and motor oil ($1,968): $39.36 at 2%
     
  • Other vehicle expenses ($2,842): $56.84 at 2%
     
  • Healthcare ($4,928): $98.56 at 2%
     
  • Entertainment ($3,203): $64.06 at 2%
     
  • Personal care products ($762): $45.72 at 6%
     
  • Education ($1,491): $29.82 at 2%

Total rewards: $923.75

While $900+ is a lot to earn in rewards within a year, you have the potential to earn a lot more. After all, these are just some of the expenses the average family faces and not all of them. If you could pay some additional big bills with credit each month like daycare or your rent, you could significantly add to your bottom line.

What to watch out for

While maximizing rewards cards is a smart idea if you’re using them already anyway, there are always pitfalls to be aware of when you’re using a credit card. Here’s what to watch out for during your quest for more cash back and travel rewards.

Fees for using credit

While there are many bills you can pay with credit without a fee, some vendors, merchants, and service providers charge a fee to use a credit card as payment. Fees are especially prevalent on bills such as utilities, cable or internet, rent, and insurance. Make sure to verify you aren’t being charged a fee to use credit before you proceed.

Annual fees

Don’t forget that some rewards cards charge annual fees. These fees may be worth it depending on your spending and rewards haul, but you should always factor them into the equation to make sure each fee is worth paying. If you’re against paying annual fees, look for rewards cards that don’t charge one.

Budgeting mishaps

Using a credit card for all your expenses may simplify your financial life, but it could also cause your budget to fall out of whack. Make sure you’re only spending on purchases you planned to make anyway, and that you’re tracking your spending and paying off your credit cards regularly.

Debt

Never use credit cards for purchases you can’t afford to repay if you’re pursuing rewards. The interest you’ll pay will always be much more than the rewards you earn. If you’re worried using credit will cause you to rack up debt you can’t afford to repay, you’re better off sticking to cash or debit instead.

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Want to maximise your credit card rewards? The key to getting the most out of your rewards cards is understanding how they work and looking for opportunities to earn more points on your everyday spending. We’ve got the ultimate tips and tricks to help you save money and earn more rewards! | #creditcards #rewardsprogram #creditcardrewards


Source: feeds.killeraces.com