With several new products coming to the U.S. this year, the Visa payment network is working to propel consumers into a future where purses are lighter, pockets are emptier and payments are easier. Most notable among the company’s plans: one “credential” that gives users the option to pay with a credit card, debit card, rewards points, or a “buy now, pay later” plan.
“No one wants a thick wallet. It’s the George Constanza problem,” says Matthew Goldman, founder of the financial technology consulting firm Totavi, referencing an episode of “Seinfeld” where one character’s overstuffed wallet causes him back pain.
If you’re one of the 48% of Americans who used a digital wallet in the past 90 days, per March 2024 data from J.D. Power, you’re already experiencing technology’s wallet-slimming potential. However, merchant acceptance is still iffy, especially when it comes to small businesses. The J.D. Power 2024 Merchant Services Satisfaction Study found that only 57% of small businesses now accept digital wallets.
Still, this has been a busy spring when it comes to digital payment innovation. Just a week after Visa announced its new suite of services, Google Pay announced the launch of new features, too. The Google Pay app will now show your cards’ benefits at checkout so you can pick the one that will earn the most rewards for the purchase (for now, this is limited to American Express or Capital One cards when checking out on the Chrome browser). You’ll also be shown buy now, pay later options for more merchants than before. Plus, you can autofill details like shipping and billing information with a fingerprint, face scan or screen lock PIN.
Visa’s launch is part of a larger trend of making it effortless to make purchases. “These innovations are all designed to streamline payment actions and make it easier and safer for consumers to transact across different environments in a more consistent manner,” said Beth Robertson, managing director at Keynova, a financial services intelligence firm, in an email.
Visa’s new services
Visa is launching several new services, some of which pertain to electronic bill payments and data security. Here are the ones with the most potential to change your shopping experience:
Visa Flexible Credential
The service that might get the most notice from anyone who carts around a card-filled wallet is Visa Flexible Credential. It allows you to access multiple payment options — including debit and credit cards, loyalty points, and buy now, pay later plans — from one payment source. You can also set some parameters, like paying with debit if a purchase is below a certain amount and paying with credit if it exceeds that amount.
Tap to Everything
You’re likely already growing more accustomed to tapping your card, as opposed to dipping it into a chip reader, as merchants update their point-of-sale (POS) terminals to access contactless payments. Tap to Everything expands upon this idea, with the promise that “any device can now be a POS device,” per Visa’s news release. For instance, merchants will be able to take payments by letting consumers tap their cards to the merchant’s mobile device.
That tapping process may even translate to peer-to-peer payments, allowing “money to be sent between family and friends” in a similar way, Visa’s release notes.
You’ll also be able to tap your card to your own phone to securely add it to a digital wallet, or to add it as a payment method on a merchant’s website.
Visa Payment Passkey Service
Instead of entering passwords or one-time security codes when shopping online, Visa Payment Passkey Service allows you to use your face or fingerprint to authorize the transaction.
What will change for consumers?
These products will begin coming to the market later this year. Some details about how they’ll work are still unclear, like which cards may be eligible to use with Visa Flexible Credential. How quickly consumers adopt new ways of paying can also come down to merchant acceptance.
“I think it’s important for leading issuers to promote options like these and to educate their customers about their value,” Robertson said. She added that merchants prominently mentioning these payment options on their own websites will make them more visible to consumers.
Ultimately, these are steps toward a future where picking the right payment method for each purchase, and authenticating those purchases so your bank knows they aren’t fraudulent, will be faster and easier than ever before. According to Robertson, we’ve already seen some of these innovations elsewhere, like credit cards that offer buy now, pay later plans for eligible purchases, and your face or fingerprint being used to initiate a payment.
As consumers and merchants more fully embrace digital wallets, innovations that reduce friction during the checkout process will continue to come to the market.
“I think the physical form factor of the card is going to go away,” Goldman says. “We’ll still call them cards, I suppose.”
In regards to your recent “When to Take Social Security” article, you left something out. You can take Social Security early (say, age 62), then invest that money, and your investment will end up better than if you had waited on Social Security until age 67 or age 70.
Interesting! But does the math work? Let’s dive in. Should you take Social Security early and invest it?
What Kind of “Returns” Do You Get For Waiting on Social Security?
Let’s start by looking at Social Security. What kind of “return on investment” do you receive by delaying your Social Security decision?
There’s no easy way to do this today without a spreadsheet, so we will use this Google Sheet to show you some math. (I keep the original file pristine so all readers see the same numbers, but you can go to File –> Make a Copy to create your own copy of the file to play around with.)
For starters, we need to understand how retirees’ benefits change as they age. Depending on their birth year, today’s retirees reach their “Full Retirement Age” (FRA) at 66 or 67 years old. Depending on the age at which they apply for Social Security, they’ll receive a certain percentage of their full benefits, described in the table below.
To make the math easy, we will assume our retiree’s Primary Insurance Amount (PIA)…aka the amount you receive if you wait until FRA…is $1000 per month. So “100%” on the table above equals $1000 per mont
The longer our retiree waits, the higher their monthly payments will be. But what does that look like as an “investment?” And how does inflation factor in?
What About Inflation?
The Social Security Administration adjusts everybody’s Social Security payments yearly to account for inflation. This “cost of living adjustment” is often shortened to “COLA.”
The average COLA adjustment since 1975 has been 3.66%. We need to include that in our spreadsheet too.
Baseline Analysis – No Investments Yet
Let’s start with a baseline analysis. We’ll examine a series of retirees who collect their Social Security monthly, and immediately spend it. They make no investments with their Social Security cash flow. We could conceptualize this as hiding those dollars underneath their mattresses.
We’ll compare results by looking at the total dollar amounts collected over time. This will be our baseline analysis. You can follow along on the spreadsheet tab labeled “No Investment Return (Yet) – Nominal Dollars Only”
The results: in this scenario, early collection only makes sense for a retiree who dies before age 74. This should make sense. We know that delaying Social Security makes more and more sense the longer someone lives.
Let’s add in investment returns.
Analysis 1: Investing in a 4.7% Savings Account
Let’s consider a retiree who takes all of their Social Security income and deposits it into a savings account bearing 4.7% annual interest.
Why 4.7%? That’s the average overnight Federal Funds rate since 1960, and modern-day high-yield savings accounts tend to offer interest rates that are closely correlated to the Fed Funds rate.
Note: if your personal pile of cash isn’t in a high-yield savings account, you should ask yourself why that is…
The results: if you pass away at age 77 or earlier, collecting earlier makes sense. Otherwise, waiting until FRA or later likely makes sense. This is no different than “traditional” Social Security advice.
Analysis 2: Investing in a “Standard” 60/40 Portfolio
What if our retirees put their money in a tried-and-true 60/40 portfolio?
From 1950 until today, that kind of diversified 60/40 portfolio has returned an average of 9.3% per year.
The results: Whoa! As shown on the “A2” tab, collecting as early as possible makes sense for anyone who would pass away before age 88.
We know, on average, most 62 years olds are going to pass away well before age 88. The smart, probabilistic thing to do then, is collect Social Security as early as possible and invest it in something like a 60/40 portfolio (or, something with greater returns).
But wait…because I’ve only showed you half the story. And that’s a major problem.
Big Problem: What’s the Risk?
If we zoom out on reader DT’s idea as originally stated, we should confidently conclude: OF COURSE it makes sense! If you have sufficiently high investment returns, you should always start as early as possible.
Even if the benefit of delaying Social Security was 20% per year, but I had an investment that paid me 40% per year, I’d rather start collecting as soon as possible and get the money invested. Given sufficiently high returns, you always want to get the compound growth started.
But we must return, once again, to a foundational pillar of investing and oft-repeated maxim of The Best Interest: Risk and return are intrinsically connected.Returns are not “free.” They are compensation for taking on investment risk.
Whenever an investor compares returns alone, without also comparing the risks involved, they’re making an incomplete analysis. DT’s original question only considers return. It doesn’t consider risk.
What Comparison Makes Sense?
The benefits of delaying Social Security are guaranteed by the U.S. government. That’s very low risk. What kind of investment risk should we compare that to?
I see two viable options.
First, why does Warren Buffett invest all of Berkshire Hathaway’s extra cash into U.S. Treasuries, instead of an S&P 500 index fund? Doesn’t he know the S&P 500 has much better long-term returns?!
Answer: U.S. Treasuries are as risk-free as anything in the investing universe, backed by the full faith and credit of the U.S. government. As long as Uncle Sam pays debts, U.S. treasuries are risk-free. The S&P 500 is far from risk-free, and Buffett knows it. He wants his cash to be safe and ready for deployment at a moment’s notice. The S&P 500 cannot fulfill that need.
The first logical comparison today, then, is to use a true “risk-free” rate as our investment return. Something like a high-yield bank account (FDIC insured) or short-term U.S. Treasury is appropriate. Conveniently, we already did that in Analysis #1, where our conclusion is no different than traditional Social Security advice: the “break even” point occurs in the late 70s.
Note: this is reason for the concept of “risk-adjusted returns.”To compare only the returns of two investments is not an apples-to-apples comparison.
The second option is to show the downsides of Analysis #2. That is, to show how 9.3% per year from a 60/40 portfolio is far from a guarantee. More specifically, I’d like to show how the downside risk of a 60/40 portfolio could turn our result on its head. What happens if we suffer some bad markets during our early Social Security period?
Looking at historical returns, a 60/40 portfolio has had 10-year periods with returns below 2% per year. What if we started our Social Security timeline with that kind of low return, and then made up for it at the end of the analysis? That’s what I show on our spreadsheet on the A3 tab.
The results? The 60/40 “solution” comes with risks! In this scenario, “taking Social Security early and investing it” only worked out if our retiree died before age 75. That’s not a good outcome. Doubly so if Social Security is a safety net or backstop in your financial plan.
To Apply or Not Apply
If your Social Security is “play money” in your financial plan, and you’re ok with risking a loss, then I can see the merit and appeal of DT’s proposal. You can apply for Social Security early, invest it (reasonably), and the odds are in your favor that you’ll end up in a good spot.
But it’s no guarantee.
And the entire point of the Social Security system is to provide a guaranteed benefit to retirees. If Social Security plays even a minor role in your financial plan, I would strongly discourage putting that money at investment risk to eek out extra returns.
When we make a level comparison by using a risk-free rate, like in Analysis #1, we see there is no net benefit to taking Social Security early to invest it.
Thank you for reading! If you enjoyed this article, join 8000+ subscribers who read my 2-minute weekly email, where I send you links to the smartest financial content I find online every week.
-Jesse
Want to learn more about The Best Interest’s back story? Read here.
Looking for a great personal finance book, podcast, or other recommendation? Check out my favorites.
Was this post worth sharing? Click the buttons below to share!
However, the real estate industry has fiercely opposed the legislation, warning it could sow chaos in the rental market and devastate the livelihoods of the city’s roughly 25,000 real estate agents. “This is the start of a top-down government-controlled housing system,” said Jordan Silver, a broker with Brown Harris Stevens, told The Associated Press. “The … [Read more…]
Victor Ciardelli beamed as his mortgage company, Chicago-based Guaranteed Rate, launched a “financial wellness” and “personal well-being” app last fall before a live audience in Times Square with wellness celebrity Deepak Chopra.
“Something we are passionate about at Guaranteed Rate is caring about people and their overall well-being,” Ciardelli said in a video of the event posted online. “We wanted to make sure that we did something to help people in their general stress and alleviate pain.”
But in the days following the launch of the app, which offers home loan applications and other financial services alongside yoga classes and nutrition advice, Ciardelli wasn’t happy. Yelling at executive leadership on company calls, he referred to his employees as “failures,” complained that the team did not show him from a particular camera angle and said “Marketing is a f−−−ing disaster,” according to two executives who were on the calls.
Despite Ciardelli’s public remarks on the importance of personal well-being, many former employees told the Tribune they experienced or witnessed persistent verbal abuse and a misogynistic environment while working at Guaranteed Rate. As part of a Tribune investigation, reporters interviewed nearly 80 former employees and reviewed court records, internal company emails, written exit interviews and text messages.
Many of the former staff members who spoke with the Tribune described Ciardelli, the company’s president, CEO and founder, as a boss who was quick to berate, swear at and demean employees.
“Every person that works directly under Mr. Ciardelli is terrified of his potential anger outbursts,” one former assistant wrote to human resources after she was let go from the company a couple of years ago, according to an email reviewed by the Tribune.
Some former employees who spoke with the Tribune said they were driven to seek mental health care because of the work environment at the company; one former worker said she contacted a suicide hotline last year.
Multiple women who used to work at Guaranteed Rate, meanwhile, described working in a sexualized atmosphere where some male loan officers and managers made sexually explicit remarks to female employees, hit on them in the office or at work events, and commented inappropriately on their appearance — even, in one case, encouraging a woman to use her looks to help close a loan.
In February, a woman who used to work as a loan officer at Guaranteed Rate filed a lawsuit against two high-producing loan officers at the company, alleging sexual harassment and gender discrimination. Her complaint alleges one of the male loan officers sexually harassed her at a corporate event, that the other loan officer pressured her not to report the incident to human resources, and that for the remainder of her employment the man who made the remark used “gender-based and demeaning slurs to refer to” her and other women at the company.
Other former employees said they did not bring their complaints to human resources because they thought Ciardelli or other executives and managers meddled in the department’s business and might retaliate, with at least two former employees saying they’d observed how company leaders protected certain staff members. Others said they did complain but felt the department didn’t take the information seriously.
In response to a detailed list of questions from the Tribune, Ciardelli and Guaranteed Rate vehemently denied all of these allegations, describing the company as a positive workplace environment where women in particular are supported. The firm went to remarkable lengths to dispute the allegations, including sending the results of a worker satisfaction survey it conducted and forwarding more than 80 testimonials from current and former employees. Among them were five of Ciardelli’s current or former assistants, as well as numerous male and female executives praising his leadership and support.
The company also retained an outside law firm that, even before receiving the reporters’ list of questions, threatened to sue the newspaper for defamation.
Guaranteed Rate, whose corporate headquarters is in Chicago’s North Center neighborhood, has grown tremendously since its founding in 2000 to become one of the largest mortgage lenders in the country based on loan volume, according to industry news and data provider Inside Mortgage Finance. Its name has adorned the White Sox stadium since 2016, and as recently as 2018, Guaranteed Rate was named a Chicago Tribune Top Workplace — a distinction based on surveys conducted by an outside company, with no input from editorial staff on the selection.
Jason Scott, a former top-producing loan officer and director of VA lending, which provides home loans to military veterans and active-duty service members, at Guaranteed Rate said his earlier years at the company — when lower mortgage rates fueled industry growth — were positive. But Ciardelli’s outbursts and verbal abuse of employees grew more noticeable, he said, when rising interest rates started to erode those gains, especially after the boom years of the COVID-19 pandemic.
“I think crazy success just brings out who the real people are,” said Scott, who reported to Ciardelli in his director role and now works for CrossCountry Mortgage, a competitor of Guaranteed Rate. “What did you sacrifice to get there? Did you sacrifice your soul or your core values?”
Many other former employees who spoke with the Tribune did so on the condition they would not be named in this story, saying they feared Guaranteed Rate would sue them. Guaranteed Rate has filed lawsuits against former employees to claw back signing bonuses; it also has sued competitor New American Funding and former employees who have hired former Guaranteed Rate workers, accusing them of unlawful poaching.
Ciardelli declined to be interviewed without his attorney for this story. In response to written questions provided by the Tribune, he and the company suggested the criticism of Guaranteed Rate came from disgruntled employees who could not succeed in a demanding work environment within a challenging industry, or from people who now work for a competitor and therefore would benefit from disparaging the company.
“We hold ourselves and our team members to an incredibly high standard and are not apologetic about that,” Ciardelli said in his written responses, sent through the outside law firm retained to handle communications with the Tribune. “We also recognize … that to achieve great success, one must embrace a full ownership for their actions, both successful and otherwise to achieve growth and most important optimally serve our customers. We promote a transparent culture that supports all our team members toward that goal and welcome constructive criticism. As a result, we are not for everyone.”
Ciardelli specifically denied berating staff, yelling at executives after the app launch or ever calling employees “stupid” or “failures.” He quoted the company’s chief operating officer, Nik Athanasiou, as saying: “I have worked with Victor for 15 years. No one is in more meetings with him than me. I do not ever recall an instance where Victor was abusive toward another employee.”
Ciardelli also pointed to the company’s anti-discrimination and anti-harassment policies and said neither he nor any other executive interfered with human resources.
In response to questions from the Tribune about women’s complaints, including being subjected to sexually explicit comments and working in a “boys club” atmosphere, Ciardelli wrote that such allegations are “simply not true.” The company “has not, does not, and would not objectify women or put them in uncomfortable personal or professional situations,” he wrote.
Ciardelli also highlighted the large number of female loan officers working at the company, their professional success and the testimonials from female employees. When the Tribune asked to speak with four of those women, only one — Rola Gurrieri, the company’s New Jersey-based chief fulfillment officer — agreed to be interviewed without outside counsel or management present.
Regarding the lawsuit filed by former Guaranteed Rate loan officer Megan McDermott, the company told the Tribune it had “found no evidence supporting Ms. McDermott’s allegations of sexual harassment or gender discrimination” after conducting a “comprehensive investigation.”
Guaranteed Rate also sent a general statement detailing the company’s business philosophy, which includes a “fierce commitment to excellence.” Employees who do not “meet our core values or our quality standards” find it challenging to maintain job satisfaction at the company, it said.
“Many of these employees walk away not feeling good about the company which is a natural emotion when faced with a reality that their standards and the company standards are not aligned,” the statement said.
But many of the former employees who spoke with the Tribune described a cutthroat work culture they said could be frightening and upsetting, with several attributing that culture to Ciardelli’s laser focus on making money and growing Guaranteed Rate.
The former assistant who emailed human resources asked not to be identified in this story, fearing it might jeopardize her current job or trigger retaliation from Ciardelli. In that email, the woman wrote that she was “constantly on edge and terrified to have an interaction with Mr. Ciardelli” and that she had “consoled each assistant on his team that endured the wrath of Mr. Ciardelli’s behavior.”
“I hope that my experience will open your eyes,” she wrote.
Flying too close to the sun
In an interview with the Tribune in 2014, Ciardelli made plain his ambition to grow the company.
“If you can’t handle it, you shouldn’t be here,” Ciardelli said. “Instead of feeling like, oh, we care about people’s feelings and all that, it’s all about results.”
In the same article, Ciardelli said he worked constructively with his employees when issues arose at work. “There’s no drama involved; there’s no yelling,” he said. “Let’s fix the issue and move on.”
But multiple former executives and employees told the Tribune Ciardelli regularly yelled at and verbally attacked executives and other employees in person and on company calls, sometimes in front of hundreds of people, with the calls following the app launch just one example.
Some former and current employees told the Tribune they tried to avoid Ciardelli because they were scared of his temper.
Scott, the former director of VA lending who worked at Guaranteed Rate from 2017 until he resigned in 2022, splitting his time between offices in Hawaii and Colorado, called Ciardelli a “bully.”
Scott told the Tribune that, during one call, Ciardelli took an executive “to the woodshed and just eviscerated him verbally,” saying things such as “I can’t believe you are this stupid.”
“(Victor) throws the grenade and then he leaves the room,” not giving people a chance to explain or talk through the issue, Scott said.
At the time of Ciardelli’s 2014 Tribune interview, Guaranteed Rate had 2,500 employees nationally, 1,050 of whom were based in Chicago, according to Tribune archives.
The company grew to employ 9,708 people nationwide at its peak in 2021, Guaranteed Rate told the Tribune in May. Part of the company’s growth stemmed from its acquisitions of other mortgage companies: Manhattan Mortgage and Superior Mortgage in 2012 and Stearns Lending in 2021.
Guaranteed Rate also partners on mortgage services with some of the largest real estate companies in the country. Including the people working in those partnerships, Guaranteed Rate had 14,264 employees at its height in 2021.
Like other mortgage companies, Guaranteed Rate has suffered a significant decline in business over the last two years, stemming from mortgage rates that have more than doubled from their record lows during the pandemic.
As mortgage rates soared in 2022 and 2023, the firm implemented thousands of layoffs, with only 3,871 workers remaining as of April, or 5,756 among all its companies, excluding contractors, as of May, according to the company.
Yet Ciardelli’s volatile behavior predated the stressful times in the housing market, according to some people who worked for Guaranteed Rate. Many people who “fly too close to the sun” — a metaphor some employees used to describe working directly with Ciardelli — eventually leave, they said.
People who work in personal and executive assistant roles for Ciardelli rarely last long in their jobs, with many leaving after less than a year, former employees said. Some referred to Ciardelli’s assistant position as a “revolving door,” and the LinkedIn profiles of multiple former assistants show short stints with the company.
More than two dozen executives and senior loan officers have left the company over the last decade, with a significant exodus occurring in the past two years. Multiple former executives and loan officers — including Scott — told the Tribune they left because of Ciardelli’s verbal outbursts and what many described as a workplace where they felt bullying and misogyny were tolerated. Most now work for competitors.
Ciardelli and other executives sometimes would disparage people who left the company, according to Scott.
“I would be like ‘Guys, did anybody ever think about reaching out to them before they left and having an exit interview with them?’” Scott said. “You are talking about a person that was a top producer here that you loved them as long as they produced, and now that they leave, they are an enemy? … They are leaving for a reason.”
In Ciardelli’s written responses to Tribune questions, he said allegations of a toxic work environment or bullying on his part are “not aligned with Guaranteed Rate or my leadership.” He said neither he nor other executives have disparaged former employees when they left the company.
In response to a question about assistant turnover, Ciardelli wrote that he has worked closely with five “primary” assistants since 2000. “As is the case with any demanding support roles, there has been some turnover with secondary and tertiary assistants, but nothing that is abnormal or unexpected,” he wrote.
One testimonial sent to the Tribune was from Melissa Czaszwicz, who said she worked for Ciardelli as an executive assistant in the early 2000s. She wrote that she had a positive experience working closely with Ciardelli, who she said was especially supportive when she had children.
“Never did I witness anything inappropriate or out of line,” said Czaszwicz, who still works at Guaranteed Rate.
‘Mental health has suffered’
Some former employees who spoke with the Tribune said they were driven to seek mental health support during and after their time at the company because of the negative work environment they experienced at Guaranteed Rate.
Most of those who shared their experiences worked for an executive who has a close working relationship with Ciardelli. Former workers said this executive also verbally abused staff and was prone to volatile mood swings.
One told the Tribune she texted and called a suicide hotline last year while working at the company because of verbal abuse from the executive; she shared the texts she sent with the Tribune.
In her resignation email, sent to the executive and to the human resources department last year, she wrote: “My mental health has rapidly declined due to the way I have been treated and spoken to in the last couple of months.”
Another employee from the same team wrote in a 2019 resignation letter sent to the executive, human resources, Ciardelli and others that his “mental health has suffered.”
In the resignation email and in an interview with the Tribune, the former employee said his boss gave him the runaround when he asked for time off to attend his mother’s chemotherapy appointments and complained to other employees about his requests.
Other employees discouraged him from requesting leave directly from human resources, warning him he would be fired if he went around the executive, according to the email.
Alyssa Ortiz, another former employee, said working with this executive was like being in an “abusive” relationship, being yelled at one minute and being invited for drinks the next.
“Everyone has gotten … chewed out and left crying,” said Ortiz, who worked for Guaranteed Rate from 2017 to 2019.
Ortiz told the Tribune that human resources and Ciardelli had been notified of this executive’s verbal mistreatment of employees but did nothing. She and about a dozen other former employees told the Tribune they felt Ciardelli protected this executive because of their working relationship.
In a written exit interview from 2020, one employee from the same department described how the executive would discuss former employees’ exit interviews with current employees.
“This created a fear for us to go to HR for anything moving forward,” the employee wrote.
Ciardelli said the company was not aware of any incident in which an executive read former employees’ exit interviews aloud; he said Guaranteed Rate “would never support this practice.”
Dozens of employees have left the executive’s department since 2017, according to interviews with former workers and LinkedIn profiles. The executive has since been promoted, the executive’s LinkedIn profile and the company’s website show.
In 2018, the head of human resources at the time took away the HR representative working with the executive’s department because of “risks” the executive posed to the company, according to an email reviewed by the Tribune.
“I can’t in good conscience keep allowing (the executive) to drag other employee (sic) into … schemes,” the former HR head wrote. “And by schemes I mean risky bull−−−−.” The department would have no assigned human resources representative after that, according to the email.
In correspondence with the Tribune, Guaranteed Rate described the company as a positive workplace where abuse and harassment are not tolerated and where complaints to human resources are taken seriously.
“We are not perfect by any means, but we do work hard to listen to our employees and make sure they feel supported,” a company spokesperson wrote in an email to the Tribune in April. “Most of all, we have no tolerance for any form of bullying, harassment or mistreatment. It is not who we are or who we want to be.”
Some of the employee testimonials provided by Guaranteed Rate expressed similar sentiments. For example, Mohamed Tawy, a branch manager and senior loan officer who has been with Guaranteed Rate for three years, wrote that the culture at the company is the best he has experienced in his 15-year career.
In an interview with the Tribune, Tawy said: “As a top producer … and I’m also a minority myself, I haven’t felt anything or seen anything that makes this company in any way negative for anybody that’s different. … I’ve seen here all that matters is that you do a good job, your production is good and that you follow the protocols and the rules, and I’ve seen people succeed with that more than any company I’ve been with.”
The Guaranteed Rate spokesperson also shared the results of an employee experience survey conducted in February. According to the company, the average rating for the culture at Guaranteed Rate was 8.49 out of 10, with nearly 75% of 3,745 employees responding. Those ratings were based on employees’ stated level of comfort providing feedback and/or concerns, how much they felt supported by the company in maintaining a healthy work-life balance and their sense of Guaranteed Rate’s commitment to promoting diversity and inclusion.
The email from the spokesperson said the company received “a countless number of positive comments and appreciation for their leaders, teams and our overall culture.”
In response to Tribune questions, Guaranteed Rate said in May that the survey was anonymous and it was analyzed by its “employee experience team.” The company did not provide the Tribune with a complete set of responses from the survey, but it volunteered that employees used the word “toxic” to make a negative comment about Guaranteed Rate in only 14 of the more than 5,000 written responses provided to three open-ended survey questions.
‘Mortified and disgusted’
Megan McDermott, a single mother of three, met her supervisor at Guaranteed Rate, Jon Lamkin, in person for the first time at a corporate event in December 2015, according to the lawsuit she filed in February.
When Lamkin heard the age of her oldest child, the suit alleges, he said: “You should have known better than to let some guy’s d−−− c−−− inside you.”
According to her lawsuit, McDermott reported the comment to Joseph Moschella, a regional manager and senior loan officer at Guaranteed Rate who was responsible for McDermott’s region while she worked at the company. Moschella, the suit alleges, “pressured” her not to make a formal complaint of sexual harassment to human resources.
McDermott told the Tribune she was “mortified and disgusted” after Lamkin made the comment.
“The irony here is that Jon should have known better than to treat an employee the way he did rather than telling me I should have known better to become a single mother at 20 years old,” McDermott said, “which is vile. … He set the tone the first day I met him of the power Joe and Jon had over my career.”
As McDermott went on to become a top-producing loan officer for Guaranteed Rate in New Jersey, her suit alleges Lamkin subjected her to abuse by “regularly screaming at her and using gender-based and demeaning slurs to refer to” her and other women at the company.
Her lawsuit alleges she was “subjected to a sexual and gender-based hostile work environment” by Guaranteed Rate, Lamkin and Moschella. Her suit also alleges McDermott did not receive the same opportunities, treatment and pay as male loan officers, which some other female loan officers told the Tribune reflected their own experiences as well.
McDermott did not lodge a complaint after Lamkin’s comment because she “believed she would be retaliated against” if she did so, the suit states. When she did report to HR around 2019 that Lamkin had engaged in “abusive behavior,” the department “failed to do anything to investigate or curtail Defendant Lamkin’s behavior,” the complaint alleges.
“Joe encouraged me not to go to HR because of the damage it would do to Jon’s career,” McDermott said. “Ultimately, all that they were worried about was Jon, his reputation and his career versus reporting inappropriate behavior.”
Guaranteed Rate told the Tribune in its May response that Lamkin’s comment was “nothing more than a single off-color joke,” that McDermott accepted an apology from Lamkin and that Moschella “encouraged” McDermott to contact human resources if she was “still upset.”
The company said it “could not find any record of Ms. McDermott making any form of complaint to the company’s human resources department in 2019, either verbally or in writing.”
McDermott told the Tribune she helped build Guaranteed Rate’s business in north Jersey from the ground up and said she loved the work until she found out she was not being treated equally as a woman.
“I believe management did not want to see me succeed, didn’t take me seriously and made decisions that negatively affected me and my children financially,” said McDermott, who now works for CrossCountry Mortgage, a competitor. “I ultimately left GR because I could no longer work in an environment where I was not valued and leadership felt that they could exploit me.”
Moschella and Lamkin are still employed at Guaranteed Rate. They did not respond to a Tribune request for comment. Guaranteed Rate told the Tribune in May that it had investigated McDermott’s allegations of sexual harassment and gender discrimination and found that “there is no evidence that Mr. Lamkin or anyone else at Guaranteed Rate ever created a hostile work environment for women.”
Guaranteed Rate also said in a statement that it complies with state and federal equal pay laws. The company said an “outside law firm” had reviewed its 2023 pay data and found it compliant with state equal pay laws.
In his written responses, Ciardelli highlighted the high percentage of female loan officers at the company in comparison to its competitors and said “our women originators thrive more than at any mortgage company in the industry.”
Employee statements provided through Guaranteed Rate’s attorneys included testimonials from dozens of women. Some noted the existence of the company’s employee resource group for women, GROW, while others cited the presence of women in leadership roles throughout the company.
“In addition to my professional growth I’ve experienced, I am equally grateful for the respect and dignity with which I have been treated as a woman in the workplace,” Jaime Kinman, a senior loan officer, said in her statement. “In an industry where gender biases still exist, I have never once felt marginalized or overlooked because of my gender.”
Gurrieri, the company’s chief fulfillment officer, said in an interview with the Tribune that she “never one time” experienced misogyny at the company.
“I got promoted when I’m six months pregnant,” she said. “That’s unheard of.”
Gurrieri, who has worked for Guaranteed Rate for more than six years, described Ciardelli’s leadership style as “extremely passionate.”
“There’s never been a day where I ever felt disrespected or not appreciated,” she said.
According to a former top executive who reported to Ciardelli for many years and a former human resources employee, a handful of loan officers at Guaranteed Rate were known sexual harassers, making women feel uncomfortable with inappropriate touching and unwanted advances in work settings.
But that behavior was rarely addressed, the former workers believed, because the men were friends with Ciardelli or were high-producing loan officers — each responsible for bringing in tens of millions of dollars in loan volume. Some of these loan officers still work at Guaranteed Rate.
Ciardelli called these allegations “simply not true” and said they were contradicted by the employee testimonials provided through the company’s attorney.
“They are also inconsistent with the recollections and experiences of multiple former HR professionals,” Ciardelli wrote.
A ‘sex-driven’ culture
In interviews with the Tribune, multiple former employees described a “boys club” atmosphere at Guaranteed Rate; Scott, the former director of VA lending, said there was “a lot of misogyny.”
Jessica Moreno, a former Chicago employee who started at Guaranteed Rate at age 23, said she was the first in her family to get a corporate job. Within a year of starting her job, she said, she was paying the mortgage on her family home.
But in her department, Moreno said she experienced a “sex-driven” culture.
“All the guys were just like, tongues on the floor,” said Moreno, who worked for the company for about four years starting in 2014. Her workplace was “like a men’s locker room, and women were in it,” she said.
Male co-workers and managers would hit on her and make comments on her appearance, calling her pretty, Moreno said. Comments made at Christmas parties or happy hours could be crasser, she said.
“You’ll get, ‘Oh, I’ve always wanted to f−−− you,’” she said.
Moreno said she once overheard a male manager describe a woman who had interviewed for a job as a “fox.” Another time, she said, a manager invited a female massage therapist to the office; Moreno remembers male co-workers commenting on the therapist’s body, too.
Soon after she’d started at Guaranteed Rate, Moreno said, she met with HR to make a complaint about a manager who swore at and belittled her. The HR representative brushed off her concerns in that meeting, she said.
“After that, I felt so discouraged to never even speak up again,” Moreno said.
Moreno ended up leaving her position before taking a job working for a Guaranteed Rate loan officer; she said she was terminated after clashing with the loan officer’s assistant.
Some female former employees of Guaranteed Rate said they understood looks to be a currency within the company.
One former Chicago employee said a manager encouraged her to text a selfie to a client after hearing the client flirt with her over the phone and say he’d be inclined to speed up the loan process if he knew what she looked like.
The employee said she sent the selfie, and the manager then pushed her to go along with the client’s harassment until the loan closed, she said.
After receiving the photo, the client responded, “As pretty as you are I can’t believe some man hasn’t run off with you just howling away,” in a text reviewed by the Tribune. Later on, after sending her forms, the client texted her: “You said I would get another pic when I sent you the forms so?”
The employee said another manager in her division would frequently flirt with her and comment on her appearance. He once texted her to “stop losing weight damn it” and another time texted her that she “broke (his) concentration,” according to texts reviewed by the Tribune.
Another former Chicago employee remembered a manager telling her, while she was pregnant with her first child, “Whatever you do, don’t get a C-section — you’ll never wear a bikini again.” The employee went out on maternity leave days later. She said she did end up needing a C-section and remembers the manager’s comment echoing in her head as she was wheeled back for surgery. Two people the woman told about the incident at the time corroborated her account in interviews with the Tribune.
Several former employees in the marketing department, including two men, told the Tribune Ciardelli made comments about workers’ ages. One employee got Botox and fillers after Ciardelli told employees they were “too old” and likened the marketing department to his “grandmother’s mortgage company,” according to former marketing department employees.
In his written responses, Ciardelli said “Guaranteed Rate is committed to fostering an environment that promotes diversity, equity, inclusion, and accessibility. We maintain a comprehensive set of employment policies aimed at providing a work environment free of unlawful harassment and discrimination, where all employees treat one another with dignity and respect.”
A spokesperson said in the April 1 email sharing the employee survey results that the company had launched “even more initiatives to ensure we have a positive work environment,” including anti-harassment training, training for the human resources team “to take proper and appropriate steps and best practices for investigating and responding to employee complaints” and reminders to employees on how to report harassment or abuse.
“Our executive team has emphasized to Human Resources that all complaints should be investigated, and any form of harassment and misconduct should be dealt with swiftly – and all managers and employees who are not acting in accordance with our values be rooted out of our organization,” the spokesperson wrote.
In the company’s May responses, it said these initiatives were launched in 2023 and were to “expand and enhance” the existing training program.
All Guaranteed Rate employees must complete “harassment and discrimination prevention training” upon being hired and on an annual basis thereafter, according to the company’s May response. The company said Guaranteed Rate has an “anti-retaliation” policy that prohibits retaliation against employees who report alleged harassment or discrimination or participate in an investigation into the conduct. The company also noted it has an ethics hotline through which employees can make anonymous complaints.
“We respect and treat all employees equally no matter their sex, color, or creed,” Ciardelli wrote.
In the last 10 years, Guaranteed Rate has not settled any lawsuits involving claims of a hostile work environment, according to the company. Guaranteed Rate’s response stated that within that time frame, the company settled six claims involving allegations of a hostile work environment, including arbitration cases as well as claims filed with the Equal Employment Opportunity Commission and state and local agencies. The majority of those claims were brought by male employees, and one was resolved in Guaranteed Rate’s favor, the company said.
Guaranteed Rate employees are asked to sign mandatory arbitration agreements when they are hired, but sexual harassment claims and claims filed with the EEOC and similar state agencies are not subject to arbitration, according to Guaranteed Rate’s May responses.
‘Positive thinking’
Publicly, Ciardelli presents himself as a champion of a positive work environment — an image the company has encouraged employees to promote.
In an email sent in February by a company executive and obtained by the Tribune, employees were encouraged to share a Forbes article featuring Ciardelli; the email provided step-by-step instructions for posting it on social media.
The story, published Feb. 7, was titled “Guaranteed Rate Founder Is All In On ‘Positive Thinking’ This 2024” and described his leadership style as “Chicken Soup for the Mortgage Industry.”
“I communicate the power of positivity and gratitude to everybody around me: employees, friends, family members, everyone,” Ciardelli was quoted as saying.
Less than 24 hours after it went live, the article disappeared from the Forbes website. The site provided no explanation, but one former Guaranteed Rate employee told the Tribune former workers had written to the author about factual inaccuracies.
On Feb. 8, a Guaranteed Rate executive sent another email encouraging employees — again with step-by-step instructions — to delete any social media posts linking to the article.
“We are working with Forbes to resolve and will let you know when it will be reinstated,” the email said. “We apologize for the inconvenience, and we will send out a new link as soon as it’s available.”
The Forbes contributor declined to comment for this story. Forbes told the Tribune the article was taken down because it did not adhere to the company’s “editorial guidelines” and did not respond to further questions.
The article has yet to be republished, but Guaranteed Rate still wants people to read it. The company shared it in a PDF on its LinkedIn page.
CHARLESTON, S.C., Feb. 26, 2024 /PRNewswire/ — In a groundbreaking study that could redefine ecommerce strategies, the 2024 Home Decor Ecommerce Market Research Report by 2 Visions has revealed a significant willingness among consumers to purchase home decor items online, with an astounding 82.46% expressing openness to online shopping. This finding challenges the long-held belief that physical retail spaces hold undisputed dominance in the home decor sector.
View the full 2024 Home Décor Ecommerce Market Research Report.
Christian Lown, Freddie Mac’s executive vice president and chief financial officer, is leaving the company after four years in the post. This creates a second vacancy in the government-sponsored enterprises’ c-suite.
His decision was announced in a Securities and Exchange Commission filing posted on June 11. Lown notified the Freddie Mac board on June 5 of his intentions to leave the company, with the move effective on June 28.
“The company will begin the process of identifying a successor to Mr. Lown,” the two sentence filing said.
Freddie Mac was unable to comment beyond what was disclosed in the SEC 8-K.
Lown’s departure comes as Freddie Mac is also looking for a new chief executive. Michael DeVito retired on March 15 and Michael Hutchins, its president, is acting as the CEO on an interim basis.
The timing of the departure means that Freddie Mac will have a new voice on its next quarterly earnings call.
Lown is leaving Freddie Mac after almost exactly four years in the role, starting in the job on June 15, 2020. Prior to that, he held the same title at student loan servicer Navient Corp.
From May 2006 through March 2017, Lown was at Morgan Stanley, where he was a managing director of the financial institutions group. He also worked at UBS as a vice president and Credit Suisse as an associate.
Lown is also a board member of Merscorp, a subsidiary of Intercontinental Exchange’s ICE Mortgage Technology.
No interim replacement for Lown has been named at this time. However, Donald Kish, who held the CFO position on an interim basis between James Mackey’s resignation in December 2019 and Lown’s hiring, is still Freddie Mac’s senior vice president, corporate controller and principal accounting officer.
Inside: Learn what 50 an hour is how much a year, month, and day. Plus tips to budget your money. Don’t miss the ways to increase your income.
You’re probably wondering if I made $50 a year, how much do I truly make? What will that add up to over the course of the year when working?
Is my $50 an hour take home pay comparable to others in my industry? Is $50 an hour paycheck a good salary?
First of all, this is a wage you can actually live on and should be able to thrive and reach your financial goals. Annually $50 an hour should help you to breathe easier with your finances. You might wonder how can I start to increase my hourly wage to $55, $60, or $65 per hour?
Most of the hourly jobs that pay over $50 an hour do not require a degree, which is great news! Those paid on a salary basis tend to have a college degree and do not even calculate their hourly wage.
In this post, we’re going to detail exactly what $50 an hour is how much a year. Also, we are going to break it down to know how much is made per month, bi-weekly, per week, and daily.
That will help you immensely with how you spend your money. Because too many times the hard-earned cash is brought home, but there is no actual plan for how to spend that money.
By taking a step ahead and making a plan for the money, you are better able to decide how you want to live, make sure that you put your money goals first, and not just living paycheck to paycheck struggling to survive.
The ultimate goal with money success is to be wise with how you spend your money.
If that is something you want too, then keep reading. You are in the right place.
$50 an Hour is How Much a Year?
When we ran all of our numbers to figure out how much is $50 per hour is as an annual salary, we used the average working day of 40 hours a week.
40 hours x 52 weeks x $50 = $104,000
$104,000 is the gross annual salary with a $50 per hour wage.
As of June 2023, the average hourly wage is $33.58 (source).
Let’s Break Down Of 50 Dollars An Hour Is How Much A Year
Typically, the average workweek is 40 hours and you can work 52 weeks a year. Take 40 hours times 52 weeks and that equals 2,080 working hours. Then, multiply the hourly salary of $50 times 2,080 working hours, and the result is $104,000.
That number is the gross income before taxes, insurance, 401K, or anything else is taken out. Net income is how much you deposit into your bank account.
You cross the 6 figure salary, which is a huge step with your income! That is way higher than the average $60000 salary threshold, which is desired to become middle-income worker.
Work Part Time?
But you may think, oh wait, I’m only working part-time. So if you’re working part-time, the assumption is working 20 hours a week at $50 an hour.
Only 20 hours per week. Then, take 20 hours times 52 weeks and that equals 1,040 working hours. Then, multiply the hourly salary of $50 times 1,040 working hours and the result is $52,000.
How Much is $50 Per Month?
On average, the monthly amount would average $8,667.
Annual Amount of $104,000 ÷ 12 months = $8,667 per month
Since some months have more days and fewer days like February, you can expect months with more days to have a bigger paycheck. Also, this can be heavily influenced by how often you are paid and on which days you get paid.
This helps a financially stable person manage their finances without a bunch of stress. And if you are making $100k a year and still stressing about money, then you need to learn to drastically cut your expenses.
Work Part Time?
Only 20 hours per week. Then, the monthly amount would average $4,333.
How Much is $50 per Hour Per Week
This is a great number to know! How much do I make each week? When I roll out of bed and do my job, what can I expect to make at the end of the week?
Once again, the assumption is 40 hours worked.
40 hours x $50 = $2,000 per week.
Work Part Time?
Only 20 hours per week. Then, the weekly amount would be $1000.
How Much is $50 per Hour Bi-Weekly
For this calculation, take the average weekly pay of $2,000 and double it.
$2,000 per week x 2 = $4,000
Also, the other way to calculate this is:
40 hours x 2 weeks x $50 an hour = $4,000
Work Part Time?
Only 20 hours per week. Then, the bi-weekly amount would be $2,000.
How Much is $50 Per Hour Per Day
This depends on how many hours you work in a day. For this example, we are going to use an eight-hour workday.
8 hours x $50 per hour = $400 per day.
If you work 10 hours a day for four days, then you would make $500 per day. (10 hours x $50 per hour)
Work Part Time?
Only 4 hours per day. Then, the daily amount would be $200.
This post may contain affiliate links, which helps us to continue providing relevant content and we receive a small commission at no cost to you. As an Amazon Associate, I earn from qualifying purchases. Please read the full disclosure here.
Trade and Travel 2.0
Learn to trade stocks with confidence.
Whether you want to:
Retire in peace without financial anxiety
Pay your bills without taking on a side hustle
Quit your 9-5 and do what you love
Or just make more than your current income….
Making $1,000 every.single.day is NOT a pie-in-the-sky goal.
It’s been done over and over again, and the 30,000 students that Teri has helped to be financially independent and fulfill their financial dreams are my witnesses…
$50 Per Hour is…
$50 per Hour – Full Time
Total Income
Yearly Salary (52 weeks)
$104,000
Yearly Wage (50 weeks)
$100,000
Monthly Salary (173 hours)
$8,667
Weekly Wage (40 Hours)
$2,000
Bi-Weekly Wage (80 Hours)
$4,000
Daily Wage (8 Hours)
$400
Net Estimated Monthly Income
$6,617
**These are assumptions based on simple scenarios.
Paid Time Off Earning 50 Dollars an Hour
Does your employer offer paid time off?
As an hourly employee, you may or may not get paid time off.
So, here are the scenarios for both cases.
For general purposes, we are going to assume you work 40 hours per week over the course of the year.
Case # 1 – With Paid Time Off
Most hourly employees get two weeks of paid time off which is equivalent to 2 weeks of paid time off.
In this case, you would make $104,000 per year.
This is the same as the example above for an annual salary making $50 per hour.
Case #2 – No Paid Time Off
Unfortunately, not all employers offer paid time off to their hourly employees. While that is unfortunate, it is best to plan for less income.
Life happens. There will be times you need to take time off for numerous reasons – sick time, handling a family emergency, or even vacation.
So, let’s assume you take 2 weeks off without paid time off.
That means you would only work 50 weeks of the year instead of all 52 weeks. Take 40 hours times 50 weeks and that equals 2,000 working hours. Then, multiply the hourly salary of $50 times 2,000 working hours, and the result is $100,000.
40 hours x 50 weeks x $50 = $100,000
You would average $400 per working day and nothing when you don’t work.
$50 an Hour is How Much a year After Taxes
Let’s be honest… Taxes can take up a big chunk of your paycheck. Thus, you need to know how taxes can affect your hourly wage.
Also, every single person’s tax situation is different.
On the basic level, let’s assume a 12% federal tax rate and a 4% state rate. Plus a percentage is taken out for Social Security and Medicare (FICA) of 7.65%.
Gross Annual Salary: $104,000
Federal Taxes of 12%: $12,480
State Taxes of 4%: $4,160
Social Security and Medicare of 7.65%: $7,956
$50 an Hour per Year after Taxes: $79,404
This would be your net annual salary after taxes.
To turn that back into an hourly wage, the assumption is working 2,080 hours.
$79,404 ÷ 2,080 hours = $38.18 per hour
After estimated taxes and FICA, you are netting $38.18 an hour. That is $11.83 an hour less than what you thought you were paid.
This is a very highlighted example and can vary greatly depending on your personal situation. Therefore, here is a great tool to help you figure out how much your net paycheck would be.
Plus budgeting for under $38 an hour wage is much different.
$50 An Hour Salary Calculator
Now, you get to figure out how much you make based on your hours worked or if you make a wage between $50.01-50.99.
This is super helpful if you make $50.15, $50.45, or $55.90.
Plus many of the best paying jobs in real estate investment trusts pay in this range.
You are probably wondering can I live on my own making 50 dollars an hour? How much rent or mortgage payment can you afford on 50 an hour?
Using our Cents Plan Formula, this is the best-case scenario on how to budget your $50 per hour paycheck.
When using these percentages, it is best to use net income because taxes must be paid.
In this example, we calculated $50 an hour was $38.18 after taxes. That would average $6,617 per month.
According to the Cents Plan Formula, here is the high-level view of a $50 per hour budget:
Basic Expenses of 50% = $3308.50
Save Money of 20% = $1323.40
Give Money of 10% = $661.70
Fun Spending of 20% = $1323.40
Debt of 0% = $0
Can You Make These Percentages?
For someone making over $100K gross annually, this is completely doable assuming there is no debt involved. The risk most people find themselves in is lifestyle creep and keeping up with the Joneses.
You can be strategic with your saving and investing to quickly become the millionaire next door. Then, that will allow a level of time freedom you have never experienced.
To further break down an example budget of $50 per hour, then using the ideal household percentages is extremely helpful.
recommended budget percentages based on $50 per hour wage:
Category
Ideal Percentages
Sample Monthly Budget
Giving
10%
$693
Savings
15-25%
$1733
Housing
20-30%
$1820
Utilities
4-7%
$347
Groceries
5-12%
$607
Clothing
1-4%
$65
Transportation
4-10%
$347
Medical
5-12%
$443
Life Insurance
1%
$43
Education
1-4%
$87
Personal
2-7%
$160
Recreation / Entertainment
3-8%
$282
Debts
0% – Goal
$0
Government Tax (including Income Taxes, Social Security & Medicare)
15-25%
$2050
Total Gross Income
$8,667
**This is a sample budget. You can adjust your categories based on your personal situation.
Learn how much house can I afford with 100k salary.
Can I Live off $50 Per Hour?
At this $50 hourly wage, you are making more than $100K per year. So yes, you should thrive on this annual salary.
This is well over the median income of $60,000 salary. That means you should be able to increase your savings percentage each year and live better than 80% of the world.
The question is, are you? Or are you straddled in debt? Struggling and living paycheck to paycheck?
Unfortunately, too many people are still struggling even though they are making nearly 4x the minimum wage.
Should living on $100K be doable? Absolutely.
Don’t be caught in a tough situation. You need to live below your means. If not, you are wasting too much of your hard-earned cash.
Can you truly live off $50 an hour annually?
Just like any wage… you must spend less than your income. Plus consistently save.
If you are constantly struggling to keep up with bills and expenses, then you need to break that constant cycle. It is possible to be smart with money.
Your mindset is everything.
This is what you say to yourself… Okay, I am blessed to make more than the average worker. So, I must live on that paycheck or find ways to start diversifying my income into multiple streams and start investing. Then, I am going to give back to what helped me to get where I am today.
In the next section, we will dig into ways to increase and diversify your income, but for now, is it possible to thrive on $50 an hour?
Yes, you can do it, and as you can see it is possible with the sample budget of $50 per hour.
Living in a higher cost of living area would be more difficult. So, you may have to get a little creative. For example, you might have to have a roommate. Move to a lower cost of living area where rent is cheaper.
Also, you must evaluate your “fun spending” items. Many of those expenses are not mandatory and will break your budget. You can find plenty of free things to do without spending money.
5 Ways to Increase Your Annual Salary
This right here is the most important section of this post.
Even though, you are making good money. You might have reached a maximum ceiling of income in your field. You may need to change companies.
More often than not, you need to find ways to diversify your income. One type of income will get you far in your personal finance journey, but to truly see faster progress you need multiple streams of income.
Finding ways to increase your monthly pay by $500 or $1000 will add up over the year.
1. Find Alternative Ways to Make Money
In today’s society, you need to find ways to make more money. Period.
There is no way to get around it. You need to find additional income outside a traditional nine-to-five position or typical 40 hour a week job. You will reach a point where you are maxed on what you can make in your current position or title. There may be some advancement to move forward, but in many cases, there just is not much room for growth.
So, you need to find a side hustle – another way to make money.
Do something that you enjoy, turn your hobby into a way to make money, turn something that you naturally do, and help others into a service business. In today’s society, the sky is the limit on how you can earn a freelancing income.
Must Read: 20 Genius Ways on How to Make Money Fast
2. Earn Passive Income
This can be from a variety of ways including the stock market, real estate, online courses, book sales, etc. This is where the differentiation between struggling financially and becoming financially stable.
By earning money passively, you are able to do the things that you enjoy doing and not be loaded down, with having a job that you need to work, and a place that you have to go to. And you still make money doing nothing.
Here is an example:
You can start a brokerage account and start trading stocks for $50. You need to learn and take the one and only investing class I recommend. Learn how the market works, watch videos, and practice in a simulator before you start using your own money.
One gentleman started with $5,000 in his trading account and now has well over $36,000 in less than a year. Just from practice and being consistent, he has learned that passive income is the way for him to increase his income and also not be a slave to his job.
Related Reading: How Fast Can you Make Money in Stocks? The Real Answer
3. Become a Freelancer
When you make $50 an hour, you are good at your job. You know what you are doing and people are willing to pay you for it.
Pick up side jobs and spend your free time as a freelancer.
This is one of the best ways to make extra money without a lot of upfront effort or costs.
I know plenty of people who make a living as freelance writers.
The options are endless if you are willing to think outside of the box.
4. Ask for a Raise
The first thing to do is ask for a raise. Walk right in and ask for a raise because you never know what the answer will be until you ask.
If you want the best tips on how specifically to ask for a raise and what the average wage is for somebody doing your job, then check out this book. In this book, the author gives you the exact way to increase your income. The purchase is worth it or go down to the library and check that book out.
If that does not pan out, then look for a new job. Maybe a completely new industry.
It might be a total change for you, but many times, if you want to change your financial situation, then that starts with a career change. Maybe you’re stressed out at work. Making $50 an hour isn’t worth it for you if you’re not able to enjoy life; maybe changing jobs and finding another job may increase your pay, but it will also increase your quality of life.
5. Find a New Career
Because of student loans, too many employees feel like they are stuck in the career field they chose. They feel sucked into the job that they don’t like or have the potential they thought it would.
I was in the same situation for many years until I decided to make a complete career change. I am glad I did. I have the flexibility that I needed in my life to do what I wanted when I needed to do it. Plus I am able to enjoy my entrepreneurial spirit.
Tips to Live on $50 an Hour
In this last section, grasp these tips on how to live on $50 an hour. On our site, you can find lots of money saving tips to help stretch your income further.
Here are the most important tips to live on $50 an hour. More importantly stretch how much you make, in case you are in the “I don’t want to work anymore” mindset. Highlight these!
1. Spend Less Than you Make
First, you must learn to spend less than you make.
If not you will be caught in the debt cycle and that is not where you want to be. You will be consistently living paycheck to paycheck.
In order to break that dreadful cycle, it means your expenses must be less than your income.
And when I say income, it’s not the $50 an hour. As we talked about earlier in the post, there are taxes. The amount of taxes taken out of your paycheck is called your net income which is $50 an hour minus all the taxes, FICA, social security, and Medicare is taken out. That is your net income.
So, your net income has to be less than your net income. Learn the difference between gross pay vs net pay.
2. Living Below Your Means
You need to be happy. And living on less can make you happier. Studies prove that less is better.
Finding contentment in life is one thing that is a struggle for most.
We are driven to want the new shiny toy, the thing next door, the stuff your friend or family member got. Our society has trained you that you need these things as well.
Have you ever taken a step back and looked at what you really need?
Once you can find contentment with life, then you are going to be set for the long term with your finances.
Here is our story on owning less stuff. We have been happier since.
3. Make More Money
If you want if you do not settle for less, then find ways to make more money. If you want more out of life, then increase your income.
You need to be an advocate for yourself.
Find ways to make more money.
It could be a side hustle, a second job, asking for a raise, going to school to change careers, or picking up extra hours.
Whatever path you take, that’s fine. Just find ways to make more money. Period.
4. Make Saving Money Fun
You need to make saving money fun. If you’re good, since you must keep your expenses low, you have to find ways to make your savings fun!
Find new ways of saving money and have fun with it.
Even better, get your family and kids involved in the challenge to save money. Tell them the reason why you are saving money and this is what you are doing.
Here are plenty of things to do with no money. Free activities without costing you a dime. That is a fantastic resource for you and you will never be bored.
And you will learn a lot of things in life you can do for free. Personally, some of the best ones are getting outside and enjoying some fresh air.
5. No State Taxes
Paying taxes is one option to increase what you take home in each paycheck.
These are the states that don’t pay state income taxes on wages:
Alaska
Florida
Nevada
New Hampshire
South Dakota
Tennessee
Texas
Washington
Wyoming
It is very interesting if you take into account the amount of state taxes paid compared to a state with income taxes.
Also, if you live in one of the higher taxed states, then you may want to reconsider moving to a lower cost of living area. The higher taxes income tax states include California, Hawaii, New Jersey, Oregon, Minnesota, the District of Columbia, New York, Vermont, Iowa, and Wisconsin. These states tax income somewhere between 7.65% – 13.3%.
6. Stick to a Budget
You need to learn how to start a budget. We have tons of budgeting resources for you.
While creating a budget is great, you need to learn how to use one.
You do not have to budget down to every last penny.
You need to make sure your expenses are less than your income and that you are creating sinking funds for those irregular expenses.
Budget Help:
7. Pay Off Debt Quickly
The amount that you pay interest on debt is absolutely absurd.
Unfortunately, that is how many of these companies make their money from the interest you pay on debt.
If you are paying 5% to even 20-21% or higher, you need to find ways to lower that debt quickly.
Here’s a debt calculator to help you. Figure out your debt-free date.
Make that paying off debt fast is your target and main focus. I can tell you from personal experience, that it was not until we paid off our debt that we finally rounded the corner financially. Once our debt was paid off, we could finally be able to save money and set money aside in separate bank accounts and pay for cash for things.
It took us working hard to pay off debt. We needed persistence and patience while we had setbacks in our debt-free journey.
Jobs that Pay $50 an Hour
You can find plenty of jobs that pay $50 per hour. Polish up that resume, cover letter, and interview skills.
Job Search Hint: Always send a written follow-up thank you note for your interview. That will help you get noticed and remembered.
First, look at the cities that require a minimum wage in their cities. That is the best place to start to find jobs that are going to pay higher than the federal minimum wage rate. Many of the cities are moving towards this model so, target and look for jobs in those areas.
Possible Ideas:
$50 Per Hour Annual Salary
In this post, we detailed 50 an hour is how much a year. Plus all of the variables that can impact your net income. This is something that you can live off.
$104,000
That is making over $100000 a year.
In this post, we highlighted ways to increase your income as well as tips for living off your wage.
Use the sample budget as a starting point with your expenses.
Now, think back to when you were making $11 an hour… a lot has changed since then, right?
You will have to be savvy and wise with your hard-earned income. But, with a plan, anything is possible!
Still thinking I don’t want to work anymore, you aren’t alone and need to start to plan for your early retirement.
Learn exactly how much do I make per year…
Know someone else that needs this, too? Then, please share!!
Did the post resonate with you?
More importantly, did I answer the questions you have about this topic? Let me know in the comments if I can help in some other way!
Your comments are not just welcomed; they’re an integral part of our community. Let’s continue the conversation and explore how these ideas align with your journey towards Money Bliss.
A term deposit, also known as a certificate of deposit (CD) or time deposit, is a low-risk, interest-bearing savings account. In most cases, term deposit holders place their funds into an account with a bank or financial institution and agree not to withdraw the funds until the maturity date (the end of the term). The funds can earn interest calculated based on the amount deposited and the term.
This guide explains what a term deposit is in more detail, including the pros and cons of term accounts.
What Is a Term Deposit or Time Deposit?
Time deposit, term deposit, or certificate of deposit (CD) are all words that refer to a particular kind of deposit account. It’s an amount of money paid into a savings account with a bank or other financial institution. The principal can earn interest over a period that can vary from a month to years. There is usually a minimum amount for the deposit, and the earned interest and principal are paid when the term ends.
One factor to consider is that the account holder usually agrees not to withdraw the funds before the term is over. However, if they do, the bank will likely charge a penalty. Yes, that’s a downside, but consider the overall picture: Term deposits typically offer higher interest rates than other savings accounts where the account holder can withdraw money at any time without penalties.
Compared to stocks and other alternative investments, term deposits are considered low-risk (they’re typically insured by the FDIC or NCUA) for up to $250,000 per account holder, per account ownership category (say, single, joint, or trust), per insured institution. For these reasons, the returns tend to be conservative vs. higher risk ways to grow your funds.
💡 Quick Tip: Tired of paying pointless bank fees? When you open a bank account online you often avoid excess charges.
How Does a Bank Use Term Deposits?
Banks and financial institutions can make money through financing. For example, they likely earn a profit by issuing home, car, and personal loans and charging interest on those financial products. Thus, banks are often in need of capital to fund the loans. Term deposits can provide locked-in capital for lending institutions.
Here’s how many bank accounts work:
• When a customer places funds in a term deposit, it’s similar to a loan to the bank. The bank will hold the funds for a set time and can use them to invest elsewhere to make a return.
• Say the bank gives the initial depositor a return of 2.00% for the use of funds in a term deposit. The bank can then use the money on deposit for a loan to a customer, charging a 6.00% interest rate for a net margin of 4.00%. Term deposits can help keep their financial operation running.
Banks want to maximize their net interest margin (net return) by offering lower interest for term deposits and charging high interest rates for loans. However, borrowers may choose a lender with the lowest interest rate, while CD account holders probably seek the highest rate of return. This dynamic keeps banks competitive.
Recommended: Understanding the Different Types of Bank Accounts
How Interest Rates Affect Term Deposits
Term deposits and saving accounts in general tend to be popular when interest rates are high. That’s because account holders can earn a high return just by stashing their money with a financial institution. When market interest rates are low, though, people are more inclined to borrow money and spend on items like homes and cars. They may know they’ll pay less interest on loans, keeping their monthly costs in check. This can stimulate the economy.
When interest rates are low (as checking account interest rates typically are), the demand for term deposits usually decreases because there are alternative investments that pay a higher return. For example, stocks, real estate, or precious metals might seem more appealing, although these are also higher risk.
The interest rate paid on a term deposit usually depends on the amount deposited and the time until maturity. A larger deposit may earn higher interest, and a deposit for a longer period of time (says, a few years vs. a few months) may also reap higher rewards.
Get up to $300 when you bank with SoFi.
Open a SoFi Checking and Savings Account with direct deposit and get up to a $300 cash bonus. Plus, get up to 4.60% APY on your cash!
Types of Term Deposits
There are two main types of term deposits: fixed deposits and recurring deposits. Here’s a closer look.
Fixed Deposits
Fixed deposits are a one-time deposit into a savings account. The funds cannot be accessed until the maturity date, and interest is paid only on maturity.
Recurring Deposits
With a recurring deposit, the account holder deposits a set amount in regular intervals until the maturity date. For example, the account holder might deposit $100 monthly for five months. Each deposit will earn less interest than the previous installment because the bank holds it for a shorter period.
In addition to these two types, you may see banks promoting different kinds of CDs, whether they vary by term length or by features (such as a penalty-free CD, meaning you aren’t charged if you withdraw funds early).
Opening a Term Deposit
To open a term deposit account, search online for the best interest rates, keeping in mind how much you want to deposit, how often, and for how long. Most banks will ask you to fill in an online application. Make sure you read and agree to the terms of the agreement. For example, check the penalties that apply if you decide to withdraw your funds early as well as the minimum amount required to earn a certain interest rate.
Closing a Term Deposit
A term deposit may close for two reasons — either the account reaches maturity or the account holder decides to end the term early. Each bank or financial institution will have different policies regarding the penalties imposed for breaking a term deposit. Read the fine print or ask a bank representative for full details.
When time deposit accounts mature, some banks automatically renew them (you may hear this worded as “rolled over” into a new account) at the current interest rate. It would be your choice to let that move ahead or indicate to the bank that you prefer to withdraw your money.
If you want to close a term deposit before the maturity date, contact your bank, and find out what you need to do and the penalties. The penalty will depend on the amount saved, the interest rate, and the term. The fee may involve the loss of some or all of interest earned. In very rare cases, your CD could lose value in this way.
Term Deposits and Inflation
Term deposits may not keep up with inflation. That is, if you lock into an account and interest rates rise over time, your money won’t earn more. You will likely still earn the same amount promised when you funded the account. Also, once tax is deducted from the interest income, returns on a fixed deposit may fall below the rate of inflation. So, while term deposits are safe investments, the interest earned can wind up being negligible. You might investigate whether high-yield accounts or stocks, for instance, are a better option.
Term Deposit Pros
What are the advantages of a term deposit versus regular high-yield savings account and other investments? Here are some important benefits:
• Term deposit accounts are low-risk.
• CDs or time deposits usually pay a fixed rate of return higher than regular savings accounts.
• The funds in a CD or deposit account are typically FDIC-insured.
• Opening several accounts with different maturity dates can allow the account holder to withdraw funds at intervals over time, accessing money without paying any penalties. This system is called laddering.
• Minimum deposit amounts are often low.
Term Deposit Cons
There are a few important disadvantages of term deposit accounts to note, including:
• Term deposits can offer lower returns than other, riskier investments.
• Term deposits and CDs usually have fixed interest rates that do not keep up with inflation.
• Account holders likely do not have access to funds for the length of the term.
• Account holders will usually pay a penalty to access funds before the maturity date.
• A term deposit could be locked in at a low interest rate at a time when interest rates are rising.
Examples of Bank Term Deposits
Here’s an example of how time deposits can shape up. Currently, Bank of America offers a Featured CD account: A 13-month Featured CD with a deposit of more than $1,000 but less than $10,000 pays 4.75% APY.
At Chase, a 9-month CD with a deposit of more than $1,000 but less than $10,000 pays 4.25% APY. If you have $100,000 or more to deposit, the APY rises to 4.75%.
Recommended: How Do You Calculate Interest on a Savings Account?
The Takeaway
Term deposits, time deposits, or CDs are conservative ways to save. Account holders place a minimum amount of money into a bank account for a set term at a fixed interest rate. The principal and interest earned can be withdrawn at maturity or rolled over into another account. If funds are withdrawn early, however, a penalty will likely be assessed.
While these accounts typically have a low interest rate, they may earn more than standard bank accounts. What’s more, their low-risk status can help some people reach their financial goals.
Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.
Better banking is here with SoFi, NerdWallet’s 2024 winner for Best Checking Account Overall.* Enjoy up to 4.60% APY on SoFi Checking and Savings.
FAQ
Can you lose money in a term deposit?
Most term deposits or CDs are FDIC-insured, which means your money is safe should the bank fail. However, if you withdraw funds early, you may have to pay a penalty. In a worst-case scenario, this could mean that you receive less money than you originally invested.
Are term deposits and fixed deposits the same?
There is usually no difference between a term deposit and a fixed deposit. They both describe low-risk, interest-bearing savings accounts with maturity dates.
Do you pay tax on term deposits?
With the exception of CDs put in an IRA, any earnings on term deposits or CDs are usually subject to federal and state income taxes. The percentage depends on your overall income and tax bracket. If penalties are paid due to early withdrawal of funds, these can probably be deducted from taxes if the CD or term deposit was purchased through a tax-advantaged individual retirement account (IRA) or 401(k).
The SoFi Bank Debit Mastercard® is issued by SoFi Bank, N.A., pursuant to license by Mastercard International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.
SoFi members with direct deposit activity can earn 4.60% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. Direct Deposit means a recurring deposit of regular income to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government benefit payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Direct Deposit”) via the Automated Clearing House (“ACH”) Network during a 30-day Evaluation Period (as defined below). Deposits that are not from an employer or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, or are non-recurring in nature (e.g., IRS tax refunds), do not constitute Direct Deposit activity. There is no minimum Direct Deposit amount required to qualify for the stated interest rate.
As an alternative to direct deposit, SoFi members with Qualifying Deposits can earn 4.60% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Qualifying Deposits means one or more deposits that, in the aggregate, are equal to or greater than $5,000 to an account holder’s SoFi Checking and Savings account (“Qualifying Deposits”) during a 30-day Evaluation Period (as defined below). Qualifying Deposits only include those deposits from the following eligible sources: (i) ACH transfers, (ii) inbound wire transfers, (iii) peer-to-peer transfers (i.e., external transfers from PayPal, Venmo, etc. and internal peer-to-peer transfers from a SoFi account belonging to another account holder), (iv) check deposits, (v) instant funding to your SoFi Bank Debit Card, (vi) push payments to your SoFi Bank Debit Card, and (vii) cash deposits. Qualifying Deposits do not include: (i) transfers between an account holder’s Checking account, Savings account, and/or Vaults; (ii) interest payments; (iii) bonuses issued by SoFi Bank or its affiliates; or (iv) credits, reversals, and refunds from SoFi Bank, N.A. (“SoFi Bank”) or from a merchant.
SoFi Bank shall, in its sole discretion, assess each account holder’s Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving a Direct Deposit or $5,000 in Qualifying Deposits to your account, you will begin earning 4.60% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.
SoFi Bank reserves the right to grant a grace period to account holders following a change in Direct Deposit activity or Qualifying Deposits activity before adjusting rates. If SoFi Bank grants you a grace period, the dates for such grace period will be reflected on the APY Details page of your account. If SoFi Bank determines that you did not have Direct Deposit activity or $5,000 in Qualifying Deposits during the current 30-day Evaluation Period and, if applicable, the grace period, then you will begin earning the rates earned by account holders without either Direct Deposit or Qualifying Deposits until you have Direct Deposit activity or $5,000 in Qualifying Deposits in a subsequent 30-Day Evaluation Period. For the avoidance of doubt, an account holder with both Direct Deposit activity and Qualifying Deposits will earn the rates earned by account holders with Direct Deposit.
Members without either Direct Deposit activity or Qualifying Deposits, as determined by SoFi Bank, during a 30-Day Evaluation Period and, if applicable, the grace period, will earn 1.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances.
Interest rates are variable and subject to change at any time. These rates are current as of 10/24/2023. There is no minimum balance requirement. Additional information can be found at https://www.sofi.com/legal/banking-rate-sheet.
*Awards or rankings from NerdWallet are not indicative of future success or results. This award and its ratings are independently determined and awarded by their respective publications.
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.
Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.
Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.
Massive CPI Rally Cut in Half After Fed Announcement
By:
Matthew Graham
Wed, Jun 12 2024, 4:22 PM
Massive CPI Rally Cut in Half After Fed Announcement
As discussed in the AM commentary, bonds rallied sharply after this morning’s CPI data (unrounded core monthly inflation at .163% versus a 0.3% forecast). Those gains held up uneventfully until the Fed festivities began. The most significant item on the Fed agenda was the dot plot at 2pm which showed the median outlook for 2024 rate cuts falling to “one” from “three.” Fed Chair Powell offered no dovish reassurances in the press conference, nor was he even very enthusiastic about this one month of data. All of that was to be expected, but markets nonetheless acted like they expected at least a little token of rate rally affection. By 4pm, about half of the CPI gains had been erased, but that’s still a solid day in the bigger picture.
month over month core CPI
0.2 vs 0.3 f’cast, 0.3 prev
Annual core CPI
3.4 vs 3.5 f’cast, 3.6 prev
09:29 AM
sharply stronger after CPI data and holding gains so far. 10yr down 15bps at 4.271. MBS up over 3/8ths in 6.0 coupons and nearly 5/8ths in 5.5 coupons
12:37 PM
Sideways to slightly stronger at best levels. 10yr down 14.6bps at 4.257. MBS up half a point.
02:31 PM
Two-way trading after Fed’s dot plot (announcement was unchanged, basically). Initial weakness, but bouncing back as the press conference gets underway. 10yr down 13.3bps at 4.268. MBS up 14 ticks (.44).
03:26 PM
MBS are now up “only” 10 ticks (.31) in 6.0 coupons and 14 ticks (.44) in 5.5. coupons. 10yr yields are down 8.9bps at 4.311
04:02 PM
Another few ticks of weakness. MBS still up a quarter point, but about halfway back to pre-CPI levels. 10yr still down 7bps at 4.33.
Download our mobile app to get alerts for MBS Commentary and streaming MBS and Treasury prices.
Editor’s Note: Parts of this story were auto-populated using data from Curinos, a mortgage research firm that collects data from more than 250 lenders. For more details on how we compile daily mortgage data, check out our methodology here.
Mortgage rates continue their modest decline this week, although 30-year fixed rates continue to hover well above 7%. According to data from Curinos analyzed by MarketWatch Guides, today’s 30-year fixed rate is down to 7.22% APR.
On Friday, a stronger-than-expected jobs report led Lawrence Yun, chief economist for the National Association of Realtors, to predict rates will continue to remain above 7% for the next month.
While high rates continue to affect the housing market, there’s a silver lining for younger and first-time homebuyers. Real estate marketplace Realtor.com released data Tuesday indicating there are more smaller and lower-priced homes on the market than this time last year, based on price-per-square-foot data. Since last May, there has been a 46.6% increase in the amount of homes in the $200,000 to $350,000 price range across the U.S.
Here are today’s average mortgage rates:
30-year fixed mortgage rate: 7.22%
15-year fixed mortgage rate: 6.47%
5/6 ARM mortgage rate: 7.09%
Jumbo mortgage rate: 7.15%
Current Mortgage Rates
Product
Rate
Last Week
Change
30-Year Fixed Rate
7.22%
7.40%
-0.18
15-Year Fixed Rate
6.47%
6.71%
-0.24
5/6 ARM
7.09%
7.07%
+0.02
7/6 ARM
7.20%
7.24%
-0.04
10/6 ARM
7.27%
7.30%
-0.03
30-Year Fixed Rate Jumbo
7.15%
7.25%
-0.10
30-Year Fixed Rate FHA
6.89%
7.02%
-0.13
30-Year Fixed Rate VA
6.91%
7.04%
-0.13
Disclaimer: The rates above are based on data from Curinos, LLC. All rate data is accurate as of Friday, June 14, 2024. Actual rates may vary.
>> View historical mortgage rate trends
Mortgage Rates for Home Purchase
30-year fixed-rate mortgages are down, -0.18
The average 30-year fixed-mortgage rate is 7.22%. Since the same time last week, the rate is down, changing -0.18 percentage points.
At the current average rate, you’ll pay $680.14 per month in principal and interest for every $100,000 you borrow. You’re paying less compared to last week when the average rate was 7.40%.
15-year fixed-rate mortgages are down, -0.24
The average rate you’ll pay for a 15-year fixed-mortgage is 6.47%, a decrease of-0.24 percentage points compared to last week.
Monthly payments on a 15-year fixed-mortgage at a rate of 6.47% will cost approximately $869.46 per $100,000 borrowed. With the rate of 6.71% last week, you would’ve paid $882.69 per month.
5/6 adjustable-rate mortgages are up, +0.02
The average rate on a 5/6 adjustable rate mortgage is 7.09%, an increase of+0.02 percentage points over the last seven days.
Adjustable-rate mortgages, commonly referred to as ARMs, are mortgages with a fixed interest rate for a set period of time followed by a rate that adjusts on a regular basis. With a 5/6 ARM, the rate is fixed for the first 5 years and then adjusts every six months over the next 25 years.
Monthly payments on a 5/6 ARM at a rate of 7.09% will cost approximately $671.36 per $100,000 borrowed over the first 5 years of the loan.
Jumbo loan interest rates are down, -0.10
The average jumbo mortgage rate today is 7.15%, a decrease of-0.10 percentage points over the past week.
Jumbo loans are mortgages that exceed loan limits set by the Federal Housing Finance Agency (FHFA) and funding criteria of Freddie Mac and Fannie Mae. This generally means that the amount of money borrowed is higher than $726,200.
Product
Monthly P&I per $100,000
Last Week
Change
30-Year Fixed Rate
$680.14
$692.38
-$12.24
15-Year Fixed Rate
$869.46
$882.69
-$13.23
5/6 ARM
$671.36
$670.01
+$1.35
7/6 ARM
$678.79
$681.50
-$2.71
10/6 ARM
$683.53
$685.57
-$2.04
30-Year Fixed Rate Jumbo
$675.41
$682.18
-$6.77
30-Year Fixed Rate FHA
$657.93
$666.65
-$8.72
30-Year Fixed Rate VA
$659.27
$667.99
-$8.72
Note: Monthly payments on adjustable-rate mortgages are shown for the first five, seven and 10 years of the loan, respectively.
Factors That Affect Your Mortgage Rate
Mortgage rates change frequently based on the economic environment. Inflation, the federal funds rate, housing market conditions and other factors all play into how rates move from week-to-week and month-to-month.
But outside of macroeconomic trends, several other factors specific to the borrower will affect the mortgage interest rate. They include:
Financial situation: Mortgage lenders use past financial decisions of borrowers as a way to evaluate the risk of loaning money.
Loan amount and structure: The amount of money that bank or mortgage lender loans and its structure (including both the term and whether its a fixed-rate or adjustable-rate).
Location: Mortgage rates vary by where you are buying a home. Areas with more lenders, and thus more competition, may have lower rates. Foreclosure laws can also impact a lender’s risk, affecting rates.
Whether borrowers are first-time homebuyers: Oftentimes first-time homebuyer programs will offer new homeowners lower rates.
Lenders: Banks, credit unions and online lenders all may offer slightly different rates depending on their internal determination.
How To Shop for the Best Mortgage Rate
Comparison shopping for a mortgage can be overwhelming, but it’s shown to be worth the effort. Homeowners may be able to save between $600 and $1,200 annually by shopping around for the best rate, researchers found in a recent study by Freddie Mac. That’s why we put together steps on how to shop for the best mortgage rate.
1. Check credit scores and credit reports
A borrower’s credit situation will likely determine the type of mortgage they can pursue, as well as their rate. Conventional loans are typically only offered to borrowers with a credit score of 620 or higher, while FHA loans may be the best option for borrowers with a FICO score between 500 and 619. Additionally, individuals with higher credit scores are more likely to be offered a lower mortgage interest rate.
Mortgage lenders often review scores from the three major credit bureaus: Equifax, Experian and TransUnion. By viewing your scores ahead of lenders considering you for a loan, you can check for errors and even work to improve your score by paying down balances and limiting new credit cards and loans.
2. Know the options
There are four standard mortgage programs: conventional, FHA, VA and USDA. To get the best mortgage rate and increase your odds of approval, it’s important for potential borrowers to do their research and apply for the mortgage program that best fits their financial situation.
The table below describes each program, highlighting minimum credit score and down payment requirements.
Though conventional mortgages are most common, borrowers will also need to consider their repayment plan and term. Rates can be either fixed or adjustable and terms can range from 10 to 30 years, though most homeowners opt for a 15- or 30-year mortgage.
3. Compare quotes across multiple lenders
Shopping around for a mortgage goes beyond comparing rates online. We recommend reaching out to lenders directly to see the “real” rate as figures listed online may not be representative of a borrower’s particular situation. While most experts recommend getting quotes from three to five lenders, there is no limit on the number of mortgage companies you can apply with. In many cases, lenders will allow borrowers to prequalify for a mortgage and receive a tentative loan offer with no impact to their credit score.
After gathering your loan documents – including proof of income, assets and credit – borrowers may also apply for pre-approval. Pre-approval will let them know where they stand with lenders and may also improve negotiating power with home sellers.
4. Review loan estimates
To fully understand which lender is offering the cheapest loan overall, take a look at the loan estimate provided by each lender. A loan estimate will list not only the mortgage rate, but also a borrower’s annual percentage rate (APR), which includes the interest rate and other lender fees such as closing costs and discount points.
By comparing loan estimates across lenders, borrowers can see the full breakdown of their possible costs. One lender may offer lower interest rates, but higher fees and vice versa. Looking at the loan’s APR can give you a good apples-to-apples comparison between lenders that takes into account both rates and fees.
5. Consider negotiating with lenders on rates
Mortgage lenders want to do business. This means that borrowers may use competing offers as leverage to adjust fees and interest rates. Many lenders may not lower their offered rate by much, but even a few basis points may save borrowers more than they might think in the long run. For instance, the difference between 6.8% and 7.0% on a 30-year, fixed-rate $100,000 mortgage is roughly $5,000 over the life of the loan.
Expert Forecasts for Mortgage Rates
Mortgage rates have cooled significantly over the past several months. After the 30-year fixed-rate mortgage hit 8% last October, it ended 2023 closer to 7%. In fact, the average for Q4 2023 was 7.3%.
Analysts with Fannie Mae and the Mortgage Bankers Association (MBA) both project that rates will fall going into 2024 and throughout next year.
Fannie Mae economists expect rates to drop more quickly, falling below 6% by Q4 2024. Meanwhile, the MBA’s forecast for Q4 2024 is 6.1% and 5.9% for Q1 2025.
More Mortgage Resources
Methodology
Every weekday, MarketWatch Guides provides readers with the latest rates on 11 different types of mortgages. Data for these daily averages comes from Curinos, LLC, a leading provider of mortgage research that collects data from more than 250 lenders. For more details on how we compile daily mortgage data, check out our comprehensive methodology here. Editor’s Note: Before making significant financial decisions, consider reviewing your options with someone you trust, such as a financial adviser, credit counselor or financial professional, since every person’s situation and needs are different.