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Apache is functioning normally

April 4, 2024 by Brett Tams

With the rise of online payments, checks aren’t nearly as ubiquitous as they used to be. But this form of payment hasn’t disappeared. You may get a government check with your tax refund, a rebate check from a company, or an expense reimbursement check from your employer. Plus, in order to make an online payment, you‘ll need to look at your own checks to determine what your routing and account numbers are.

The upshot: Even in the digital age, it’s important to know how to read a check. Here’s a simple guide to help you find any info you need on a check.

The Routing Number

Your routing number is the first series of nine digits listed on the lower left corner of a check. This number identifies the bank where your checking account is held and reduces the chances of miscommunication in financial transactions. Even if two banks have similar names, they’re distinct from one another because of their different routing numbers.

You’ll need to know your routing number to set up direct deposit at work, transfer money into your account, and make a bill payment.

The Account Number

Your bank account number can be found on the bottom of your checks and is the second set of numbers, just to the right of your routing number. It’s usually between eight and 12 digits long (though it can be longer).

Bank account numbers are used to identify a bank account. The one listed on your checks is the number assigned to your checking account. If you also have a savings account at the same bank, it will have a different number.

If you don’t have access to a check, you can find your bank account number on your statement or by logging into your account.

Check Number

The check number is typically located on the upper right-hand corner of a check, though it can sometimes be found at the bottom of the check after the symbol at the end of your account number. It’s usually three or four digits long.

Checks are numbered in ascending order, so you can easily keep track of checks that you’ve written. When you write a check, it’s a good idea to note the check number and the amount in your check register. This will help you keep the account balanced and avoid accidental overdrafts.

Pay to the Order Of — Payee Line

This line is located in the middle of the check and where the name of the person or business being paid is written. When endorsing a check you’ve received, it’s important to sign your name as it appears on the payee line.

It is possible to write a check to yourself. In that scenario, you would simply add your name in the payee line. This is one way to move money from one bank account to another. You can also write “cash” in the payee line. In this case, anyone can cash the check.

Date Line

The date line is usually located in the upper right area of a check. It’s where you add the date you wrote the check.

If your cash flow is tight, you might be tempted to write a future date in this line, so the recipient doesn’t cash the check until there are available funds in your account. However, know that as soon as you write and sign a check, the recipient can cash it immediately — even if you post-dated the check.

Payment Amount in Numbers

The payment box appears to the right of the “pay to the order of” line, and where you write the dollar amount the check is written for in numeric form, including both dollars and cents. For instance, if the check is for three hundred dollars, you would write “300.00.”

Payment Amount in Words

Below the payee line is a space for the check issuer to write the payment amount in word form. Cents, however, are written in numbers. For example, a check for “$500.25” it’s written out as “Five hundred dollars and 25/100.” If there are no cents, the issuer might write XX/100.

The payment amount in words needs to match the payment amount written in numerical form in the payment box. If these amounts don’t match up, the check can still be cashed, but the bank will only honor the amount that is written out in word form.

Fractional Bank Number

The fractional bank number often goes unnoticed, as it’s typically printed in a smaller font size and isn’t of much importance today. You can find this number towards the top right of your check and it’s listed in two parts — a numerator, then a slash, and a denominator, thus a “fraction.”

A fractional bank number identifies the bank where your checking account is held, but, since the same information is included in your routing and account numbers, it’s not used much anymore.

Your Information

If you’re writing a check, your personal information is located at the top left of the check. This includes your name on the first line, your address in the next few lines, followed, in some cases, by your phone number.

If your checks have an outdated address printed on them, don’t worry — you can still use them. Financial institutions use routing numbers and account numbers to identify where they should pull the money from, not your personal information written on the top left of your check.

Recommended: A Guide to Ordering Checks for Less

For/Memo

The memo box is housed at the bottom left corner of the check and typically begins with “for”. This space gives you an opportunity to briefly note the purpose of the payment, or maybe add a personalized message to the recipient. For instance, you might write “June rent” or “Happy Birthday Sally.”

Signature

The line on the lower right area of a check is where you sign your name. Your signature needs to match the one the bank has on file. If you accidentally sign with a shortened first name or nickname (such as Jon versus Jonathan) or with your maiden name versus your current last name, the bank might refuse to process the transaction.

Bank Name/Logo

The bank name and logo is usually located above the memo box. This tells where the checking account is held. It also adds an additional layer of security. If you receive a check where the logo looks slightly off, or you’ve never heard of the bank listed here, it’s a tipoff that the check might be counterfeit.

Endorsement Line

The endorsement line is located on the back of the check and is usually on the right side. This is where the check recipient, or payee, provides their signature. Without proper endorsement, the bank won’t process the check.

If you’re endorsing a check for a mobile deposit, you may need to write “For mobile deposit only” (or similar wording) under your signature, or check a box labeled “for mobile deposit.” Rules vary by bank.

The Takeaway

While checks aren’t as common as they used to be, you may still receive and write checks. You’ll also likely need to refer to your checks to find important details about your account, such as your routing and account numbers. You’ll need these numbers to sign up for direct deposit or set up an electronic payment or funds transfer.

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.

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Photo credit: iStock/AndreyPopov

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 deposit to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government 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, do not constitute Direct Deposit activity. There is no minimum Direct Deposit amount required to qualify for the stated interest rate.

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.

SoFi® Checking and Savings is offered through SoFi Bank, N.A. ©2023 SoFi Bank, N.A. All rights reserved. Member FDIC. Equal Housing Lender.

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.

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.

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Source: sofi.com

Apache is functioning normally

April 2, 2024 by Brett Tams

A home equity loan is a lump sum of money you can borrow at a fixed rate based on the equity, or ownership stake, in your home. If you already paid off 15% to 20% of your house, this one-time installment loan can be used to cover major expenses, from home renovations to paying off debt.

Home equity loans have fixed interest rates, so your monthly payments are predictable and easy to budget for. But because your home acts as collateral for the loan, you could risk foreclosure if you fall behind on repayments.

I’ve spoken with experts about the advantages and disadvantages of home equity loans, how they work and where to find the best rates. Here’s what I’ve uncovered.

This week’s home equity loan rates

Here are the average rates for home equity loans and home equity lines of credit as of March 27, 2024.

Loan type	This week’s rate	Last week’s rate	Difference
10-year, $30,000 home equity loan	8.73%	8.73%	None
15-year, $30,000 home equity loan	8.70%	8.70%	None
$30,000 HELOC	9.01%	8.99%	+0.02

Note: These rates come from a survey conducted by CNET sister site Bankrate. The averages are determined from a survey of the top 10 banks in the top 10 US markets.

Current home equity loan rates and trends

Though home equity loan rates will vary depending on the lender and loan type, their rates are generally lower than personal loans or credit card annual percentage rates.

Home equity loan rates aren’t directly set by the Federal Reserve, but adjustments to the federal funds rate impact the borrowing cost for financial products like home equity loans and home equity lines of credit, aka HELOCs.

Since March 2022, the Fed has hiked its benchmark rate a total of 11 times in an attempt to slow the economy and bring inflation down, driving home equity loan rates up alongside. Though the Fed has kept interest rates steady since last summer, home equity loan rates have remained elevated for borrowers. Home equity rates are likely to stay high until the central bank begins cutting interest rates, projected for later this year.

With home equity loans, you tap into your equity without giving up the rate on your primary mortgage, making them a popular alternative to cash-out refinances. If you use a home equity loan to install solar panels or renovate your kitchen, you get the added benefit of increasing your home’s value.

“Most homeowners with mortgages in 2024 are choosing home equity loans or HELOCs, instead of a cash-out refinance, to avoid losing their attractive interest rates,” said Vikram Gupta, head of home equity at PNC Bank.

Best home equity loan rates of March 2024

Lender	APR	Loan amount	Loan terms	Max LTV ratio
U.S. Bank	From 8.40%	Not specified	Up to 30 years	Not specified
TD Bank	7.99% (0.25% autopay discount included)	From $10,000	5 to 30 years	Not specified
Connexus Credit Union	From 7.20%	From $5,000	5 to 15 years	90%
KeyBank	From 10.29% (0.25% autopay discount included)	From $25,000	1 to 30 years	80% for standard home equity loans, 90% for high-value home equity loans
Spring EQ	Fill out application for personalized rates	Up to $500,000	Not specified	90%
Third Federal Savings & Loan	From 7.29%	$10,000 to $200,000	Up to 30 years	80%
Frost Bank	From 7.3% (0.25% autopay discount included)	$2,000 to $500,000	15 to 20 years	90%
Regions Bank	From 6.75% to 14.125% (0.25% autopay discount included)	$10,000 to $250,000	7, 10, 15, 20 or 30 years	89%
Discover	6.99% for 1st liens, 7.99% for 2nd liens	$35,000 to $300,000	10, 15, 20 or 30 years	90%
BMO Harris	From 8.84% (0.5% autopay discount not included)	From $25,000	5 to 20 years	Not specified

Note: The above annual percentage rates are current as of March 1, 2024. Your APR will depend on such factors as your credit score, income, loan term and whether you enroll in autopay or other lender specific requirements.

Best home equity loan lenders of March 2024

U.S. Bank

Good for nationwide availability

U.S. Bank is the fifth largest banking institution in the US. It offers both home equity loans and HELOCs in 47 states. You can apply for a home equity loan or HELOC through an online application, by phone or in person. If you want a loan estimate for a home equity loan without completing a full application, you can get one by speaking with a banker over the phone.

APR: From 8.40%
Max LTV ratio: Not specified
Max debt-to-income ratio: Not specified
Min credit score: 660
Loan amount: $15,000 to $750,000 (up to $1 million for California properties)
Term lengths: Up to 30 years
Fees: None
Additional requirements: Subject to credit approval
Perks: You can receive a 0.5% rate discount by enrolling in automatic payments from a U.S. Bank checking or savings account.

TD Bank

Good for price transparency

Primarily operating on the East Coast, TD Bank offers home equity loans and HELOCs in 15 states. You can apply for a TD Bank home equity loan or HELOC online, by phone or by visiting a TD Bank in person. The online application includes a calculator that will tell you the maximum amount you can borrow based on the information you input. You can also see a full breakdown of rates, fees and monthly payments. No credit check is required for this service.

APR: From 7.99% (0.25% autopay discount included)
Max LTV ratio: Not specified
Max debt-to-income ratio: Not specified
Min credit score: Not specified
Loan amount: From $10,000
Term lengths: Five to 30 years
Fees: $99 origination fee at closing. Closing costs only application to loan amounts greater than $500,000.
Additional requirements: Loan amounts less than $25,000 are available only for primary residence property use.
Perks: You will receive a 0.25% discount if you enroll in autopay from a TD personal checking or savings account.

Connexus Credit Union

Good branch network

Connexus Credit Union operates in all 50 states, but it offers home equity loans and HELOCs in 46 states (excluding Alaska, Hawaii, Maryland and Texas). The credit union has more than 6,000 local branches. To apply for a home equity loan or HELOC with Connexus, you can fill out a three-step application online or in person. You won’t be able to see a personalized rate or product terms without a credit check.

APR: From 7.20%
Max LTV ratio: 90%
Max-debt-to-income ratio: Not specified
Min credit score: Not specified
Loan amount: From $5,000
Term lengths: Five to 15 years
Fees: No annual fee. Closing costs can range from $175 to $2,000, depending on your loan terms and property location. It has returned loan payments fees of $15, convenience fees of $9.95 (for paying by debit or credit card online) and $14.95 (for paying by phone) and a forced place insurance processing fee of $12.
Additional requirements: Because Connexus is a credit union, its products and services are only available to members. Member eligibility is open to most people: you (or a family member) just need to be a member of one of Connexus’s partner groups, reside in one of the communities or counties on Connexus’s list or become a member of the Connexus Association with a $5 donation to Connexus’s partner nonprofit.
Perks: Flexible membership options

KeyBank

Good online application user experience

Based in Cleveland, KeyBank offers home equity loans to customers in 15 states and HELOCs to customers in 44 states. Aside from a standard home equity loan, KeyBank offers a few different HELOC options. The KeyBank application allows you to apply for multiple products at one time. If you’re not sure whether KeyBank loans are available in your area, the application will tell you once you input your ZIP code. If you’re an existing KeyBank customer, you can skim through the application and import your personal information from your account.

APR: From 10.29% (0.25% client discount included)
Max LTV ratio: 80% for standard home equity loans, 90% for high-value home equity loans
Max debt-to-income ratio: Not specified
Min credit score: Not specified
Loan amount: From $25,000
Term lengths: One to 30 years
Fees: Origination fee of $295. Closing costs aren’t specified.
Additional requirements: Borrowers must be at least 18 years of age and reside in one of the states KeyBank operates in.
Perks: KeyBank offers a 0.25% rate discount for clients who have eligible checking and savings accounts with them.

Spring EQ

Good option for high debt-to-income ratio limits

Spring EQ was founded in 2016 and serves customers in 38 states. Spring EQ offers home equity loans and HELOCs. Spring EQ doesn’t display rates for its home lending products online — you must complete an application to see your personalized rate. The Spring EQ loan application process is simple though. Customers can see an extensive breakdown of their loan term and rate options without needing to undergo a credit check or provide their Social Security number.

APR: Not specified
Max LTV ratio: 90%
Max debt-to-income ratio: 50%
Min credit score: 640
Loan amount: Up to $500,000
Term lengths: Not specified
Fees: Spring EQ loans may be subject to an origination fee of $995 and an annual fee of $99 in some states.
Additional requirements: Spring EQ does not display rates for its home lending products online — you must complete an application to see your personalized rate.
Perks: Spring EQ has a higher maximum DTI ratio than most other lenders — compare 50% with the typical 43% average.

Third Federal Savings & Loan

Good option for rate match guarantee

Third Federal Savings & Loan first opened in 1938. Today, the bank offers home equity loans in eight states and HELOCs in 26 states. Third Federal offers a lowest rate guarantee on its HELOCs and home equity loans, meaning Third Federal will offer you the lowest interest rate relative to other similar lenders or pay you $1,000. You can apply for a home equity loan or HELOC on the Third Federal website. You won’t have to register an account to apply, but you’re still able to save your application and return to it later.

APR: From 7.29%
Max LTV ratio: 80%
Max debt-to-income ratio: Not specified
Min credit score: Not specified
Loan amount: $10,000 to $200,000
Term lengths: Five to 30 years
Fees: Home equity loans and HELOCs with Third Federal have an annual fee of $65 (waived the first year). There are no application fees, closing fees or origination fees.
Additional requirements: Specific requirements aren’t listed.
Perks: If you set up autopay from an existing Third Federal account, you’ll be eligible for a 0.25% rate discount.

Frost Bank

Good option for Texas borrowers

Frost Bank’s home equity loans and HELOCs are only available to Texas residents. You can apply for a home equity loan or HELOC on the Frost Bank website, but you’ll need to create an account. According to the website, the application will only take you 15 minutes.

APR: From 7.3% (0.25% autopay discount included, only available for 2nd liens)
Max LTV ratio: 90%
Max debt-to-income ratio: Not specified
Min credit score: Not specified
Loan amount: $2,000 to $500,000
Term lengths: 15 or 20 years
Fees: No application fee, annual fee or closing costs. Frost Bank does charge a $15 monthly service fee, which can be waived with a Frost Plus Account.
Additional requirements: Borrowers must reside in Texas. The bank also requires proof of homeowners insurance.
Perks: 0.25% rate discount for clients who enroll in autopay from a Frost Bank checking or savings account. However, this feature is only available for second liens.

Regions Bank

Good rate discounts

Regions Bank is one of the nation’s largest banking, mortgage and wealth management service providers. Regions offers home equity loans and HELOCs in 15 states. You can apply for a Regions home equity loan or HELOC online, in person or over the phone. You’ll have to create an account with Regions to apply. Before you create an account, though, you can use the bank’s own rate calculator to estimate your rate and monthly payment.

APR: From 6.75% to 14.125%(0.25% autopay discount included)
Max LTV ratio: 89%
Max debt-to-income ratio: Not specified
Min credit score: Not specified
Loan amount: $10,000 to $250,000
Term lengths: Seven, 10, 15, 20 or 30 years
Fees: No closing costs and no annual fees. Late fees apply for 5% of the payment amount. There is a returned check fee of $15 and an over limit fee of $29.
Additional requirements: Not specified.
Perks: Rate discounts between 0.25% and 0.50% to those who elect to have their monthly payments automatically debited from a Regions checking account.

Discover

Good option for no fees or closings costs

Discover is known primarily for its credit cards, but it also offers home equity loans — available in 48 states. The lender does not offer HELOCs at all. You can apply for a home equity loan from Discover online or over the phone. The application process takes approximately six to eight weeks in total, according to Discover’s website.

APR: 6.99% for first liens, 7.99% for second liens
Max LTV ratio: 90%
Max debt-to-income ratio: 43%
Min credit score: 620
Loan amount: $35,000 to $300,000
Term lengths: 10, 15, 20 and 30 years
Fees: None
Additional requirements: Specific requirements not listed.
Perks: The lender charges no origination fees, application fees, appraisal fees or mortgage taxes.

BMO Harris

Good option for second liens

BMO Harris products and services are available in 48 states (all but New York and Texas). BMO Harris offers home equity loans and three variations of a HELOC. You can apply for a home equity loan or HELOC online or in person, but in order to get personalized rates, you’ll have to speak with a representative on the phone. Getting personalized rates doesn’t require a hard credit check.

Home equity loans from BMO Harris are only available as second liens. If you have already paid off your mortgage, a rate-lock HELOC from BMO Harris may be a better option.

APR: From 8.84% (0.5% autopay discount not included)
Max LTV ratio: Not specified
Max debt-to-income ratio: Not specified
Min credit score: 700
Loan amount: From $5,000
Term lengths: Five to 20 years
Fees: There is no application fee. BMO Harris will also pay closing costs for loans secured by an owner-occupied 1-to-4-family residence. If you pay off your loan within 36 months of opening, you may be responsible for recoupment fees.
Additional requirements: Home equity loans are only available as a second lien (meaning you can’t be mortgage free)
Perks: If you enroll in autopay with a BMO Harris checking account, you’ll be eligible for a 0.5% rate discount.

What is a home equity loan?

A home equity loan is a fixed-rate installment loan secured by your home as a second mortgage. You’ll get a lump sum payment upfront and then repay the loan in equal monthly payments over a period of time. Because your house is used as a collateral, the lender can foreclose on it if you default on your payments.

Most lenders require you to have 15% to 20% equity in your home to secure a home equity loan. To determine how much equity you have, subtract your remaining mortgage balance from the value of your home. For example, if your home is worth $500,000 and you owe $350,000, you have $150,000 in equity. The next step is to determine your loan-to-value ratio, or LTV ratio, which is your outstanding mortgage balance divided by your home’s current value. So in this case the calculation would be:

$350,000 / $500,000 = 0.7

In this example, you have a 70% LTV ratio. Most lenders will let you borrow around 75% to 90% of your home’s value minus what you owe on your primary mortgage. Assuming a lender will let you borrow up to 90% of your home equity, you can use the formula to see how that would be:

$500,000 [current appraised value] X 0.9 [maximum equity percentage you can borrow] – $350,000 [outstanding mortgage balance] = $100,000 [what the lender will let you borrow]

A standard repayment period for a home equity loan is between five and 30 years. Under the loan, you make fixed-rate payments that never change. If interest rates go up, your loan rate remains unchanged.

Second mortgages such as home equity loans and HELOCs don’t alter a homeowner’s primary mortgage. This lets you borrow against your home’s equity without needing to exchange your primary mortgage’s rate for today’s higher rates.

Home equity loans have fixed interest rates, which is a positive if you’re looking for predictable monthly payments. The rate you lock in when you take out your loan will be constant for the entire term, even if market interest rates rise.

Reasons to get a home equity loan

A home equity loan is a good choice if you need a large sum of cash all at once. You can use that cash for anything you’d like — it doesn’t have to be home-related.However, some uses make more sense than others.

Home renovations and improvements: If you want to upgrade your kitchen, install solar panels or add on a second bathroom, you can use the money from a home equity loan to pay for the cost of these renovations. Then, at tax time, you can deduct the interest you pay on the loan — as long as the renovations increase the value of your home and you meet certain IRS criteria.

Consolidating high-interest debt: Debt consolidation is a strategy where you take out one large loan to pay off the balances on multiple smaller loans, typically done to streamline your finances or get a lower interest rate. Because home equity loan interest rates are typically lower than those of credit cards, they can be a great option to consolidate your high-interest credit card debt, letting you pay off debt faster and save money on interest in the long run. The only downside? Credit card and personal loan lenders can’t take your home from you if you stop making your payments, but home equity lenders can.

College tuition: Instead of using student loans to cover the cost of college for yourself or a loved one, you can use the cash from a home equity loan. If you qualify for federal student loans, though, they’re almost always a better option than a home equity loan. Federal loans have better borrower protections and offer more flexible repayment options in the event of financial hardship. But if you’ve maxed out your financial aid and federal student loans, a home equity loan can be a viable option to cover the difference.

Medical expenses: You can avoid putting unexpected medical expenses on a credit card by tapping into your home equity before a major medical procedure. Or, if you have outstanding medical bills, you can pay them off with the funds from a home equity loan. Before you do this, it’s worth asking if you can negotiate a payment plan directly with your medical provider.

Business expenses: If you want to start a small business or side hustle but lack money to get it going, a home equity loan can provide the funding without many hoops to jump through. However, you may find that dedicated small business loans are a better, less risky option.

Down payment on a second home: Homeowners can leverage their home’s equity to fund a down payment on a second home or investment property. But you should only use a home equity loan to buy a second home if you can comfortably afford multiple mortgage payments over the long term.

Experts don’t recommend using a home equity loan for discretionary expenses like a vacation or wedding. Instead, try saving up money in advance for these expenses so you can pay for them without taking on unnecessary debt.

Pros

One lump sum payment of total loan up front.
Fixed interest rate, meaning you won’t have to worry about your rate rising over the repayment period.
Typically lower interest rate than credit cards or personal loans.
Little to no restrictions on what you can use the money for.

Cons

Your home is used as collateral, meaning it can be taken from you if you default on the loan.
If you’re still paying off your mortgage, this loan payment will be on top of that.
Home equity loans can come with closing costs and other fees.
May be hard to qualify for if you don’t have enough equity.

Home equity loan vs. HELOC

Home equity loans and HELOCs are similar but have a few key distinctions. Both let you draw on your home’s equity and require you to use your home as collateral to secure your loan. The two major differences are the way you receive the money and how you pay it back.

A home equity loan gives you the money all at once as a lump sum, whereas a HELOC lets you take money out in installments over a long period of time, typically 10 years. Home equity loans have fixed-rate payments that will never go up, but most HELOCs have variable interest rates that rise and fall with the prime rate.

A home equity loan is better if:

You want a fixed-rate payment: Your monthly payment will never change even if interest rates rise.
You want one lump sum of money: You receive the entire loan upfront with a home equity loan.
You know the exact amount of money you need: If you know the amount you need and don’t expect it to change, a home equity loan likely makes more sense than a HELOC.

A HELOC is better if:

You need money over a long period of time: You can take the money as you need it and only pay interest on the amounts you withdraw, not the full loan amount, as is the case with a home equity loan.
You want a low introductory interest rate: Although HELOC rates may increase over time, they also typically offer lower introductory interest rates than home equity loans. So you could save money on interest charges.

Home equity loans vs. cash-out refinances

A cash-out refinance is when you replace your existing mortgage with a new mortgage, typically to secure a lower interest rate and more favorable terms. Unlike a traditional refinance, though, you take out a new mortgage for the home’s entire value — not just the amount you owe on your mortgage. You then receive the equity you’ve already paid off in your home as a cash payout.

For example, if your home is worth $450,000, and you owe $250,000 on your loan, you would refinance for the entire $450,000, rather than the amount you owe on your mortgage. Your new cash-out refinance home loan would replace your existing mortgage and then offer you a portion of the equity you built (in this case $200,000) as a cash payout.

Both a cash-out refi and a home equity loan will provide you with a lump sum of cash that you’ll repay in fixed amounts over a specific time period, but they have some important differences. A cash-out refinance replaces your current mortgage payment. When you receive a lump sum of cash from a cash-out refi, it’s added back onto the balance of your new mortgage, usually causing your monthly payment to increase. A home equity loan is different — it doesn’t replace your existing mortgage and instead adds an additional monthly payment to your expenses.

Who qualifies for a home equity loan?

Although it varies by lender, to qualify for a home equity loan, you’re typically required to meet the following criteria:

At least 15% to 20% equity built up in your home: Home equity is the amount of home you own, based on how much you’ve paid toward your mortgage. Subtract what you owe on your mortgage and other loans from the current appraised value of your house to figure out your home equity number.
Adequate, verifiable income and stable employment: Proof of income is a standard requirement to qualify for a HELOC. Check your lender’s website to see what forms and paperwork you will need to submit along with your application.
A minimum credit score of 620: Lenders use your credit score to determine the likelihood that you’ll repay the loan on time. Having a strong credit score — at least 700 — will help you qualify for a lower interest rate and more amenable loan terms.
A debt-to-income ratio of 43% or less: Divide your total monthly debts by your gross monthly income to get your DTI. Like your credit score, your DTI helps lenders determine your capacity to make consistent payments toward your loan. Some lenders prefer a DTI of 36% or less.

A home equity loan is better if:

You don’t want to pay private mortgage insurance: Some cash-out refinances require PMI, which can add hundreds of dollars to your payments, but home equity loans don’t.
You can’t complete a refinance: With rates rising, it’s possible that your mortgage rate is lower than current refinance rates. If that’s the case, it likely won’t make financial sense for you to refinance. Instead, you can use a home equity loan to take out only the money you need, rather than replacing your entire mortgage with a higher interest rate loan.

A cash-out refinance is better if:

Refinance rates are lower than your current mortgage rate: If you can secure a lower interest rate by refinancing, this could save you money in interest, while providing access to a lump sum of cash.
You want only one monthly payment: The amount you borrow gets added back to the balance of your mortgage so you make only one payment to your lender every month.
Less stringent eligibility requirements: If you don’t have great credit or you have a high debt-to-income ratio, or DTI, you may have an easier time qualifying for a cash-out refi compared with a home equity loan.
Lower interest rates: Cash-out refinances sometimes offer more favorable interest rates than home equity loans.

Tips for choosing a lender

You’ll want to consider what type of financial institution best suits your needs. In addition to mortgage lenders, financial institutions that offer home equity loans include banks, credit unions and online-only lenders.

“Select a lender that makes you feel comfortable and informed with the home equity loan process,” said Rob Cook, vice president of marketing, digital and analytics for Discover Home Loans. “Look at what tools a lender makes available to borrowers to help inform their decision. For many borrowers, being able to apply and manage their application online is important.”

One option is to work with the lender that originated your first mortgage as you already have a relationship and a history of on-time payments. Many banks and credit unions also offer discounted rates and other benefits when you become a customer.

Some lenders offer lower interest rates but charge higher fees (and vice versa). What matters most is your annual percentage rate because it reflects both interest rate and fees.

Ensure the specific terms of the loan your lender is offering make sense for your budget. For example, be sure the minimum loan amount isn’t too high — be wary of withdrawing more funds than you need. You also want to make sure that your repayment term is long enough for you to comfortably afford the monthly payments. The shorter your loan term, the higher your monthly payments will be.

“Costs and fees are an important consideration for anyone who is looking for a loan,” Cook said. “Homeowners should understand any upfront or ongoing fees applicable to their loan options. Also look for prepayment penalties that might be associated with paying off your loan early.”

No matter what, it’s important to talk to numerous lenders and find the best rate available.

How to apply for a home equity loan

Applying for a home equity loan is similar to applying for any mortgage loan. You’ll need both a solid credit score and proof of enough income to repay your loan.

1. Interview multiple lenders to determine which lender can offer you the lowest rates and fees. The more companies you speak with, the better your chances of finding the most favorable terms.

2. Have at least 15% to 20% equity in your home. If you do, lenders will then take into account your credit score, income and current DTI to determine whether you qualify as well as your interest rate.

3. Be prepared to have financial documents at the ready, such as pay stubs and Form W-2s. Proof of ownership and the appraised value of your home will also be necessary.

4. Close on your loan. Once you submit your application, the final step is closing on your loan. In some states, you’ll have to do this in person at a physical branch.

FAQs

As of March 27, average home equity loan rates are 8.73% for a $30,000 10-year home equity loan and 8.70% for a $30,000 15-year home equity loan — higher than the average rate for a 30-year fixed rate mortgage, which is currently 7.01%. Both home equity rates and mortgage rates started off at historic lows at around 3% at the beginning of 2022 and have been consistently climbing in response to the Federal Reserve aggressively raising the benchmark interest rate.

Most lenders will allow you to borrow anywhere from 15% to 20% of your home’s available equity. To calculate your home equity, subtract your remaining mortgage balance from the current appraised value of your home. How much equity a bank or lender will let you take out depends on a number of additional factors such as your credit score, income and DTI ratio. For most homeowners, it can take five to 10 years of mortgage payments to build up enough tappable equity to borrow against.

A home equity loan can affect your score positively or negatively depending on how responsibly you use it. As with any loan, if you miss or make late payments, your credit score will drop. The amount by which it will drop depends on such factors as whether you’ve made late payments before. However, HELOCs are secured loans that are backed by your property, so they tend to affect your credit score less because they’re treated more like a car loan or mortgage by credit-scoring algorithms.

Lenders are currently offering rates that start as low as 5% to 6% for borrowers with good credit, but rates can vary depending on your personal financial situation. A lender will base your interest rate on how much equity you have in your home, your credit score, income level and other aspects of your financial life such as your DTI ratio, which is calculated by dividing your monthly debts by your gross monthly income.

Home equity loans can be used for anything you choose to spend the money on. Typical life expenses that people usually take out home equity loans for are to cover expenditures such as home renovations, higher education costs like tuition or to pay off high-interest charges like credit card debt. There’s a bonus for using your loan for home improvements and renovations: the interest is tax deductible.

You can also use a home equity loan in the event of an emergency like unplanned medical expenses. Whatever you chose to use your loan for, keep in mind that taking out a large sum of money that accrues interest is an expensive choice to carefully consider, especially because you’re using your home as collateral to secure the loan. If you can’t pay back the loan, the lender can seize your home to repay your debt.

Methodology

We evaluated a range of lenders based on factors such as interest rates, APRs and fees, how long the draw and repayment periods are, and what types and variety of loans are offered. We also took into account factors that impact the user experience such as how easy it is to apply for a loan online and whether physical lender locations exist.

Source: cnet.com

Apache is functioning normally

March 28, 2024 by Brett Tams

Credit unions offer unique benefits — such as potentially higher interest rates than at traditional banks. While many credit unions offer membership only to certain groups, some credit unions are open to everyone. Becoming a member of a credit union requires applying for membership and meeting a credit union’s requirements. Here’s what you need to know about how to join one.

How to join a credit union in 5 steps

1. Consider what you want from a credit union.

Credit unions are as varied as banks. Before joining one, consider what you want out of your experience and choose the institution that’s right for you. Here are a few questions to ask yourself:

Do you prefer an online-only option or one that offers branches?
Do you need access to ATMs?
Are you looking for high interest rates on deposits, low interest rates on loans, or specialized options such as accounts for kids or teens?
Will you be able to avoid any fees the credit union charges?
Is there a credit union that supports a cause or community you also want to support or are a part of?

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2. Confirm you meet membership requirements.

Some credit unions require that you live, work or worship in a certain area, or that you be part of certain associations or organizations. A local teachers credit union, for example, may be available only to educators of a particular school district or state. Other credit unions have open membership requirements — meaning anyone can join as long as they meet a requirement such as opening a savings account or making a donation to an affiliated cause or organization.

3. Collect your required information and documents.

Once you’ve verified you’re eligible to join the credit union you’ve selected, gather the required things to apply for membership. You’ll need to provide personal information such as:

Your name.
Date of birth.
Contact information (email address, mailing address and phone number).
Drivers license or government-issued ID.
Social Security number.

If you’re joining a credit union that’s exclusive to certain people, you may also need to provide proof that you are eligible for membership: a pay stub or a school transcript, for example, or other documentation.

4. Apply for membership.

Follow the application process. Depending on the credit union, you can do this online or in person at a branch if the credit union has them. Applying for membership can take as little as a few minutes.

5. Make a deposit to your new account.

Once your application is approved and your membership begins, make a deposit into your new account. Note that some accounts require a certain minimum deposit to open or a certain minimum balance to avoid fees.

What to know about joining a credit union

Credit unions are different from banks. Credit unions are not-for-profit financial institutions, and when you join a credit union, you become a shareholder, or owner. In contrast, banks are for-profit businesses that allow customers to have accounts.

Deposit accounts are called share accounts. At a credit union, deposit accounts are called “share accounts” (and “share certificates” for certificates of deposit) — because as a member, you own a share of the credit union. Thus, your account earnings at a credit union are referred to as “dividends” (the equivalent of interest at a bank).

Credit union membership requirements vary. Many credit unions offer membership only to certain groups (for example, firefighters, teachers or residents of particular regions). Some credit unions are open to anyone who meets an open-to-anyone requirement, such as depositing a few dollars into a new account or joining a particular organization.

Some credit unions offer shared branches and/or a shared network of ATMs. If your credit union participates in shared branching, that means you can complete some of your banking tasks at other credit unions that belong to the same network. If your credit union belongs to a shared network of ATMs, you’ll have access to more ATMs than just your credit union’s branded ones.

Source: nerdwallet.com

Apache is functioning normally

March 26, 2024 by Brett Tams

Do you want to learn how to move out at 18 with no credit, little money, or even no money? Here’s what you need to know. There are many reasons for why you may want to move out at a young age – perhaps you have a difficult home life, you want to move somewhere…

Do you want to learn how to move out at 18 with no credit, little money, or even no money? Here’s what you need to know.

There are many reasons for why you may want to move out at a young age – perhaps you have a difficult home life, you want to move somewhere new, or you just want your own space.

I moved out shortly after turning 18 (about a week or so after my 18th birthday) into a rental home, and while I was not prepared at all, I do think being prepared to move out at a young age is extremely helpful. I made many mistakes that led to many, many tears, money wasted, stress, and more.

Today, I want to help you avoid as many problems as you can.

After all, moving out at 18 years old (or any other young age) is already really hard, and there is such a huge learning curve.

Moving out when you turn 18 is a big step into becoming an adult. Even though it can be exciting, moving out for the first time needs to be planned carefully. Before you leave, it’s important to make a plan to make sure you can afford it and stay on your own.

This means finding a job, making a budget you can stick to, and saving money for unexpected costs.

How To Move Out at 18

Below are ways to move out at 18.

Recommended reading: Buying a House at 20 (How I did it)

Make a plan to move out at 18

I highly recommend having a plan if you want to move out at 18 years old.

Moving out at 18 is a big step, and making a plan will help everything go a little more smoothly.

You will want to think about things such as:

Where you will work
How you will pay your bills
If you will live with a roommate or on your own
What your budget will be like
What you’ll do if things get tough, such as if you can’t afford your rent
What you will do for health insurance and medical bills

And so much more.

I will be going further in-depth on many of these below.

Find ways to make money

If you are 18 and want to move out, then you will need to have a stable source of income, of course. There are many options for earning money, from traditional jobs to more flexible side hustles.

A full-time job typically gives you more hours and benefits like health insurance, which are helpful when you’re living on your own. If you have other things going on, a part-time job might be better because it offers more flexibility while still giving you money (but, you may not earn as much money). You can find job openings online, at job fairs, or on community bulletin boards. Jobs like delivering food can be either full-time or part-time, and companies tend to need people.

If you want to make more money, you can side hustle to make extra income – a way to make extra cash that you do alongside your main job. You could freelance by doing things like writing, teaching tutoring lessons, or designing graphics. Or, you could babysit for families nearby, walk dogs, or help people with tasks or errands. These little jobs can add up to a lot of money and give you the flexibility to work when you want.

When I was young and first moved out, I worked full-time at a retail store. I also eventually started a few side hustles (like blogging, freelance writing, and selling stuff online) so that I could pay off my student loans quickly. Living on your own is not easy, especially when you are young and your income is not that high – so side hustles may be needed so that you can make enough money to pay your bills.

Some helpful articles to read include:

Create a budget

When you’re ready to step out into the world at 18, you need a budget. I can’t think of any young adult who would not need a budget.

Budgets are great because they help you keep track of your money coming in and going out. With a monthly budget, you’ll know exactly how much you can spend on different things each month as it helps you see how much money you have and where you might need to cut back on spending.

A budget will help you to figure out if you can afford to live on your own, if you need to have roommates, or if you need to find a cheaper living arrangement.

Making a budget is easy. First, write down how much money you make each month from your job or other places. Then, write down what you need to spend money on each month, like:

monthly rent
food
phone bill
internet
car
fuel
utilities like electrical, water, trash, sewer, gas/propane
car insurance
medical/health
pet care
restaurants
cable, satellite, or any TV monthly subscriptions
household essential items, like toilet paper, trash bags, etc.
and some money for fun stuff too

Knowing your monthly expenses will help you to better manage your money so that you won’t go into credit card debt.

Recommended reading: The Complete Budgeting Guide: How To Create A Budget That Works

Save for the move (and open a bank account)

When you’re getting ready to move out at 18, saving money is obviously very important. If you can help it, I do not recommend moving out with no money saved.

Think about all the costs you’ll face – like rent, your first security deposit, food, and any unexpected things that pop up. You’ll want to tuck away money for this.

How much should you save to move out? A good rule is to save at least three to six months of living expenses. For example, if you spend $1,500 a month, aim to save between $4,500 and $9,000 before you head out on your own.

This will be your emergency fund. An emergency fund is money you save up for unexpected things that might happen. This could be paying bills if you lose your job or if your hours or pay get reduced. It could also cover unexpected expenses like a car repair, medical bill, or fixing a broken window.

An emergency isn’t something like buying a birthday present, a new TV, or going on vacation.

Having an emergency fund is smart because it can stop you from getting into debt you don’t need. Some people rely on their credit cards for emergencies, but that’s not a good plan.

I also recommend getting your own bank account for all of the money you save. It’s a safe place for your money, and it helps you track what you earn and spend. Plus, you’ll need it for things like direct deposit from jobs or paying bills online.

I personally use Marcus by Goldman Sachs for my savings account as they have a very high rate. You can get up to 5.50% at the time of this writing through a referral link bonus. According to this high-yield savings account calculator, if you have $10,000 saved, you could earn $550 with a high-yield savings account in a year. Whereas with normal banks, your earnings would only be $46.

Improve your credit score and history

When you’re moving out of your parents’ home, having a good credit score is super helpful. This is because your credit score and credit history may be used for things like getting approved for an apartment and getting signed up for utility bills.

If your credit score is low, then you may be denied an apartment and even have to pay large deposits to get signed up for utilities (like water and electric).

Here are some important things to know:

Understand credit utilization – This is all about how much credit you’re using compared to how much you have. Try to use less than 30% of your credit limit. Say your card has a $1,000 limit. Aim to spend no more than $300.

Always pay on time – You should pay every bill on time, every time. Even being a little late can hurt your credit score a LOT!

There are other ways to improve your credit, such as by getting a secured credit card or becoming an authorized user on a family member’s credit card.

Here are two really helpful articles I recommend reading:

I also recommend keeping an eye on your credit by checking your score and report. Sites offer free checks, and it’s good to know where you stand. That way, you can fix any mistakes fast.

Think about where you’ll live

When planning to move out at 18, picking where you’ll live is a huge step.

Here are some things to think about:

Think about who you’ll live with. Living by yourself can be expensive so sharing rent and other bills with roommates can save you money, but make sure you choose your roommates wisely. You’ll be sharing your space with them, so it’s important to pick people who are responsible and trustworthy (and will actually pay the bills!).
Try using online tools to compare different areas. You can check things like crime rates, public transportation options, and how close they are to places you need, like grocery stores.
Think about the cost. Can you pay the rent and utility bills every month? Make sure to include these costs in your budget. Sometimes, living a bit farther from popular areas can be cheaper.

For my first home, I rented a very small 400-square-foot home with no real bedroom. But, it was within my budget and next to my college (I lived a few miles away), and surprisingly affordable.

Talk to your parents

When you’re getting ready to move out at 18, it’s important to have a conversation with your parents. This might feel hard or even impossible, but remember that clear communication is important.

I recommend choosing a time to tell them when your parents aren’t too busy or stressed as having this conversation when everyone is relaxed can make it easier for everyone to talk openly.

I think it is also helpful to think about how your parents might feel. If you’re the first to leave the home, they might find it tough. Try to understand their perspective and mention that you’ll stay in touch and visit.

And, be ready to show them your plan. Your parents will want to know you’ve thought things through. If you’ve been saving money, let them know. Talk about your job and how you’re managing to support yourself. It’s good to tell them about the place you’re planning to move into and how you chose it.

How to move out of your parents if it isn’t safe

So, after reading the above, I know that some of you may not have a good home life. You may not feel safe telling your parents that you are moving out.

If that’s the case, then I recommend reading this section.

Sometimes, home isn’t the safe place that it’s supposed to be. If you’re in a tough situation and need to leave at 18 but can’t talk to your parents about it, you’re not alone.

Here’s what you can do:

Find an adult you trust – Look for someone you trust, like a teacher, counselor, or family friend. They can maybe give you support and help you figure out your options.
Plan ahead – Start thinking about where you’ll go and how you’ll support yourself. Look into shelters, transitional housing programs, or staying with a trusted friend or relative.
Know your rights – As you turn 18, you have rights. Learn about your options for housing, education, and employment because there may be resources available to help you.
Stay safe – If you’re in danger at home, prioritize your safety. Contact local authorities or organizations that can help you leave safely.
Take care of yourself – Moving out can be tough, but remember to take care of yourself emotionally and physically, such as by talking to friends, finding support groups, or talking to a counselor if you need to.

Leaving home at 18 without being able to talk to your parents is hard, but it’s not impossible. Reach out for help, make a plan, and remember that you deserve to live in a safe and supportive environment.

Get free stuff for your new home

One of the big challenges of moving out on your own is affording all of the different things that you need.

Luckily, there are ways to get things for free or really cheap.

Some of the top ways include:

Facebook Buy Nothing groups – This is my favorite place to start if you want to get things for free. These groups promote recycling and reusing items instead of throwing them away when you’re done with them. To begin, look for and join a local Buy Nothing group on Facebook. You can search for groups for your city. People list their free stuff all the time, such as furniture, electronics, clothes, and more. You can even make a post asking if anyone has something that you need.
Ask family and friends – Your family and friends might have extra stuff they’re willing to part with. They might even be happy to see it go to a good home – your new home!
Check online platforms – Websites like Craigslist, Freecycle, and Facebook Marketplace can be goldmines for free furniture. People often list items they want to get rid of quickly.
Visit thrift stores and yard sales – Thrift stores and yard sales sometimes offer “free bins” or low-cost items they want to get rid of fast.
Attend college move-out days – If you live near a university, go there on move-out day. Students tend to leave behind perfectly good furniture that’s yours for the taking.
Community centers and churches – These places often have bulletin boards with listings for free items.

Always be safe when arranging pickups, especially with strangers. Always bring a friend or let someone know where you’re going.

Helpful articles:

Handling utilities and bills

Dealing with utilities and bills is a big step in moving out. Utilities are services you need like water, electricity, gas, and the internet.

Before you move, call or visit the websites of local utility companies. You’ll need to set up accounts in your name. This might include a deposit fee, so be ready for that.

I recommend making a list of all your expected bills. Rent, electricity, water, internet, and maybe gas are usually the basics. Add them up to see how much you’ll spend each month.

After you move in, you will want to find out when each bill is due. It’s your job to pay them on time as paying late can lead to extra fees or even getting your services turned off. Some companies let you set up automatic payments, and this means the money comes out of your bank account on its own each month. This can make sure you’re always on time.

You will want to hold onto your bills and receipts. This way, if there’s ever a mistake with a bill, your records will help fix it.

You can save money by being smart about using your services. Turn off lights when you leave a room and unplug electronics that you’re not using. You might also shop around for better deals on services like the internet.

After you get your first set of bills, you will understand why your parents wanted to keep the air conditioning off or why they always asked you to turn the lights off – things can be expensive!

Also, remember that different times of the year will impact your bills. For example, your electric bill will most likely be a lot more expensive in the summer than it will be in the spring or fall.

Maintain your home (housekeeping)

Moving out at 18 means taking on the responsibility of housekeeping. You might be surprised how quickly your new home can become cluttered and get dirty.

Keeping your home nice starts with regular cleaning, and I recommend setting aside some time each day for tasks like washing dishes, making your bed, and tidying up the living area. This way, messes won’t pile up and become overwhelming.

Then, once a week, dedicate your time to deeper cleaning such as vacuuming, mopping floors, cleaning the bathroom, dusting, and doing laundry.

Housekeeping also requires tools and supplies, so you will want to plan your budget to include items like sponges, cleaners, and trash bags.

Make friends in your new community

Moving out at 18 is a big step, and making friends in your new community is important. It can make your new place feel like home. When you move, you might not know many people, but there are fun and simple ways to meet people.

Here are some tips:

Get to know your neighbors – Start with a smile and say hi to your neighbors.
Join local groups or classes – Look for groups that interest you. Love to paint? Find an art class. Enjoy cooking? Maybe there’s a cooking group nearby. Like rock climbing? Go to the local climbing gym. This way, you meet people who like what you like.
Visit community centers – Many towns have a community center. They have activities like sports, games, and events.

Making friends might take time, but it’s totally possible! Just be yourself and be open to talking to new people.

Balancing work and personal life

I’m guessing you will have a lot going on, between trying to work full-time and enjoying your life, and even possibly furthering your education.

I recommend trying to schedule your time so you don’t get too busy. Use a calendar or app to make sure you’ve got time for work, taking care of your place, and doing fun things too.

It’s okay to say no if you’re too busy. If you’re working a full-time job, you might not be able to hang out with your friends all the time. It’s all about finding a healthy balance between earning money and enjoying life. I had to say no to my friends many times because I was simply too busy. If your friends still live at home, it may be hard for them to understand this unless you explain your situation.

Plus, remember to take breaks. When you’re planning your week, set aside some time just for relaxing. Watching a movie, reading, or hanging out in the park are all great ways to unwind and give your mind a break.

Frequently Asked Questions

Below are common questions about how to move out at 18 years old with little money.

How can I move out fast at 18?

To move out quickly, focus on making a steady income and finding affordable housing. Create a budget to manage your expenses and look for immediate job openings or housing options. Saving as much money as you can right now is also super helpful.

How much money should I have saved by 18 to move out?

Aim to save at least 3 to 6 months of living expenses before moving out. This safety net can cover rent, groceries, and unexpected costs, giving you financial stability as you start on your own.

Can you move out at 18 while still in high school?

Yes, you can move out at 18 while in high school, but make sure you have a support system in place. Balancing school responsibilities with living independently can be very hard.

How to move out at 18 with strict parents?

When moving out at 18 with strict parents, communicate your plans clearly and respectfully. Prepare a well-thought-out plan to show them you’re serious and capable of managing your own life.

Can your parents not let you move out at 18?

When you turn 18, you’re legally an adult in most places, and you can decide to move out even if your parents don’t agree. However, it’s important to respect their opinion and explain your reasons. There are some places where you have to be older, so make sure you do your research.

Do I have to tell my parents I’m moving out?

While you’re not legally required to inform your parents in most places, it’s nice to talk about your decision with them, as transparent communication helps maintain a positive relationship after you leave.

Can I move out at 18 without parental consent?

Yes, in most places, at 18 you’re legally permitted to move out without parental consent. You will want to make sure this applies to your local area.

What things do you need when moving out of your parents’ house?

There are many things that you will need to move out of your parents’ house such as a bed, blanket, pillow, kitchen supplies, towels, a place to eat, a dresser, cleaning supplies, groceries, and more.

Is it realistic to move out at 18?

It is realistic to move out at 18 if you have a reliable income, a budget, and a plan for handling responsibilities. You will want to be as prepared as possible to move out at a young age because there will be many hurdles thrown your way, most likely.

How To Move Out At 18 – Summary

I hope you enjoyed this article on how to move out at 18 years old.

It’s really important to have a plan for a successful move when you are just 18 years old.

You’ll need to find ways to earn money regularly, like getting a job and even doing extra work on the side.

Having savings in the bank and an emergency fund will help you handle unexpected expenses without ruining your plans.

There are also many other things to think about, such as the cost of living, utility bills, your credit score, and more.

I moved out when I was just 18 years old, so I completely understand where you are coming from. I had no financial help from my parents and found and did everything on my own – from making money to finding a place to live, making all of my own meals, and more. It was hard, but it was what needed to be done.

Do you plan on moving out soon? Do you have any questions for me on how to move out at 18?

Apache is functioning normally

March 26, 2024 by Brett Tams

Next time you’re planning a vacation, a travel credit card could defray some or all of the costs if it packs the right incentives. Typically, cards with higher annual fees provide the most value with perks like ongoing rewards, free checked bags, airport lounge access or other benefits. But even cards with low or no annual fees make it possible to earn some value toward travel, if you can qualify.

These cards generally require good credit (scores of 690 or higher), and even if you’re eligible, it’s not worth pursuing one if you can’t pay off the credit card bill in full every month to avoid steep interest charges. And if you’re working toward paying down existing debt, it might not be worth chasing points and miles until you’ve made progress on that front.

But as long as travel credit cards align with your financial goals, their potential savings merit consideration — even if you travel just once or twice per year. Explore the flexibility of a general-purpose travel credit card to book travel anywhere, or a branded credit card to book travel with a favorite hotel or airline. Either option may offer money-saving benefits toward your next trip.

Valuable features can lower costs

Offers will vary among general-purpose travel credit cards and airline- or hotel-branded credit cards, but some savings opportunities may include:

Perks

If a credit card offers a lengthy list of perks, the value can quickly add up. Here are some features to look out for:

A sign-up offer: Travel credit cards generally come with lucrative sign-up offers that let new cardholders earn a pile of points or miles by meeting a minimum spending requirement. It’s easier to snag if you can strategically time a credit card application around planned purchases during a heavy-spend month or season.
Free checked bags: Some airline credit cards offer free checked bags, which can add up to real savings when applied per person on a round trip. This is one way that Doug Figueroa, a content creator at the YouTube channel Zorito y Doug, makes up the cost of the $150 annual fee on an airline credit card. “The savings are $70 round trip per passenger listed in the same reservation,” he says.
TSA or Global Entry credit: Some travel cards issue a credit (up to $100) when you use them to pay for a TSA or Global Entry application fee. These expedited airport security screening programs can save time while traveling.
Travel credits: Depending on the card’s terms, travel credits may be used to save money on a variety of travel expenses like rideshare services, airfare or accommodations.
Airport lounge access: You can skip the pricey airport food with some travel credit cards that offer complimentary airport lounge access. Austin Maxwell, a South Carolina-based content creator at the blog The Maxwells Travel, uses a travel credit card to avoid those costs. “I’m saving $20 to $30 every time I go to the airport because I don’t have to buy food or drinks during a layover or preflight,” he says.
A companion ticket: Some airline credit cards cover the cost of a ticket for a friend or family member. Depending on the card’s terms, you may have to pay taxes and fees on the fare, the companion ticket may have an expiration date and/or a spending requirement may apply.
Automatic elite status: You may earn elite status without much effort on some hotel-branded credit cards. Elite status can add up to valuable savings if the program offers free food, bonus points or suite upgrades.
Free nights: If your favorite hotel has a branded credit card that offers annual free night awards, it can stretch your vacation budget.

Protections and other benefits

A travel credit card that offers trip delay or cancellation insurance, lost baggage insurance, rental car coverage or other protections may also be of value to you. To qualify for these benefits you typically need to pay for the trip or covered purchase with the eligible credit card. Read the terms carefully to understand the extent of your coverage.

Figueroa says he saved $90 over three days with his card’s primary rental car coverage on a trip to Miami.

“Once you make the online reservation, you must decline all insurance offered by the rental company and pay for everything with your [card],” he says.

High-value reward redemptions

Points or miles on some travel credit cards might lose value if they are used for non-travel redemptions like cash back, gift cards or other options. Travel redemptions typically offer the best value, and you might squeeze out even more value with a general-purpose travel card that allows points to transfer to airline or hotel partners. It’s a strategy that Maxwell uses often to his advantage.

“It’s even better if there’s a transfer bonus associated with that,” he says. “Credit card companies offer transfer bonuses — 15%, 20%, 30% bonus — if you are to transfer points to a specific airline.”

He says he has also transferred points to hotel partners to book hotel rooms with them. “It would be the equivalent of getting a hotel room at $120 that’s actually valued at $500,” he adds.

To determine whether to redeem rewards for travel or transfer them to a partner, compare costs by checking the credit card’s booking platform and the partner’s website. Also factor in whether rewards transfer on at least a 1:1 ratio, meaning that you’ll get the equivalent value in points or miles transferred.

Source: nerdwallet.com

Apache is functioning normally

March 24, 2024 by Brett Tams

The main differences between checking and savings accounts is that checking accounts are for spending and come with a debit card and checks, while savings accounts are a place to stash and grow your money via interest earned but your access may be more limited. These two kinds of financial products can form the foundation of how you manage your money day to day.

Read on to learn what the difference between a savings and checking account is, how they are the same, and the role each plays in your financial life.

Key Points

• Bank transfers move money from one bank account to another.

• These can be done by online transfers, checks, peer-to-peer services, wire transfers, third-party companies, or bank-to-bank money transfer services.

• There may be limits on how many bank transfers you can do in a specific time period and the dollar amount.

• The time it takes to complete a bank transfer may vary with the method.

Quick Comparison of Checking vs Savings Accounts

To help you understand the difference between checking and savings accounts, here is a chart summarizing some key points.

	Checking Account	Saving Account
Fees	Varies	Varies
Interest earnings	Minimal (if at all)	Yes
Debit card access	Yes	No
Check writing capabilities	Yes	No
Withdrawal limits	None	May be capped at 6 per month
Maintenance fees	Varies	Varies
Minimum opening balance	Varies	Varies
Best used for	Spending	Saving

There are similarities when you compare checking vs. savings accounts, such as varied minimum opening deposits, maintenance fees, and other monthly fees. Also, both kinds of accounts are typically insured by the FDIC (Federal Deposit Insurance Corporation) or NCUA (National Credit Union Administration), which can give you peace of mind.

That said, there are also three major points of difference between checking and savings accounts: how account holders access their money, withdrawal limits, and interest earnings.

💡 Quick Tip: Make money easy. Open a bank account online so you can manage bills, deposits, transfers — all from one convenient app.

Three Major Differences to Know

Consider these three important ways that checking vs. savings accounts can differ.

Interest Earnings

When it comes to earning a bit of a return on an online bank account, savings accounts typically offer a higher interest rate than checking accounts. In many cases, checking accounts aren’t interest-bearing, meaning no interest is earned at all. Interest rates for savings accounts vary. The current average is 0.46% APY (compared to a current average of 0.07% APY for checking accounts), according to the Federal Deposit Insurance Corporation, or FDIC. That said, you probably will find higher rates at online banks instead of bricks-and-mortar ones, with rates ranging from 4.35% to 5.15%. By not having physical locations, online banks save money and can pass savings onto their customers.

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!

Liquidity

Here’s a key difference between a savings and checking account: Checking accounts are usually used by account holders to access their cash frequently, whether paying monthly bills or buying a latte. Checking accounts generally include a debit card, which can be used for purchases or ATM withdrawals. Checks, while not as popular as they once were, are also typically provided.

Savings accounts, on the other hand, don’t usually come with debit cards. Some financial institutions offer an ATM card for deposits and withdrawals to a savings account. Similarly, they lack checks. This reinforces the idea that these accounts are not for spending.

Withdrawal Limits

Checking accounts allow unlimited withdrawals, whereas savings accounts may only allow up to six per month. After that point, the transaction could be denied or the account holder charged a penalty. The bank might even convert the savings account into a checking account.

However, in April 2020, the Federal Reserve lifted this limitation of six transactions imposed through Regulation D. Financial institutions are no longer required to limit savings account withdrawals or transfers to six per month, but some may continue to do so. Check with your financial institution to learn the full story.

What Is a Savings Account?

A savings account is an account held at a financial institution such as a bank or credit union, and its primary purpose is to store your funds safely. Most savings accounts allow the account holder to earn interest on the account balance.

A few points to note:

• Savings account rates are generally higher than those offered with checking accounts (if those pay any interest at all). For this reason, they can be a good option as a savings vehicle for money that the account holder doesn’t need to access frequently.

• Common uses for savings accounts are emergency funds, short-term savings goals, and funds for occasional expenses. The cash can accumulate in the savings account and have an opportunity to earn interest.

• As mentioned above, banks can still impose a per-month transaction limit on savings accounts — they’re just not required to by the Fed anymore. There could be fees imposed on these excess transactions, which can add up.

• Some financial institutions may automatically close an account holder’s savings account or convert the savings account to a checking account if too many withdrawals are made each month on a regular basis.

• Other financial institutions don’t charge a maintenance fee or require account holders to maintain a minimum account balance, although they may require a minimum deposit to open an account. It’s wise to check with your financial institution to make sure you understand the ground rules.

💡 Quick Tip: Most savings accounts only earn a fraction of a percentage in interest. Not at SoFi. Our high-yield savings account can help you make meaningful progress towards your financial goals.

Benefits of Savings Accounts

Here are some of the upsides of opening and maintaining a savings account:

• Savings accounts are low-risk, which means you are unlikely to lose money. Rather, you are likely to make money, thanks to interest, especially when that interest compounds.

• Interest is a plus. By shopping around for high-yield accounts, you may be able to grow your money without the volatility of investing in, say, stocks.

• Savings accounts are usually insured by the FDIC for up to $250,000 per account holder, per account ownership category, per insured institution. In the highly unlikely event of your bank going out of business, you’d be covered. What’s more, some banks participate in programs that extend the FDIC insurance to cover millions¹.

• Easy access is another plus. Unless term or time deposits, in which your money can be locked up for a specific period of time, savings accounts allow for easy withdrawal of your funds.

• Peace of mind can come with savings. Having a savings account can help you feel more secure as you work toward your financial goals. For instance, you’ll know that you have funds available if an emergency cropped up.

Recommended: Guide to Using an ATM

What Is a Checking Account?

A checking account is also held at a financial institution, though its primary purpose is to be used for everyday spending. These accounts generally don’t have any withdrawal limits, so account holders can make as many transactions as their heart desires.

• Debit cards typically come with checking accounts, and can be used for purchases at bricks-and-mortar and online retailers and to withdraw cash from an ATM.)

• Checking account holders may also be able to use paper checks, either complimentary or purchased by the account holder, which can be used to pay bills and make purchases.

• Account holders may also access their funds by P2P platforms (such as Venmo or PayPal) and other means.

Checking accounts may not earn as much interest compared to savings accounts, if they earn any interest at all.

Many financial institutions charge the same types of fees for checking accounts and savings accounts, such as monthly maintenance fees. Additional checking account fees may include overdraft or non-sufficient funds fees and out-of-network ATM fees.

Having enough money in the account and sticking with in-network ATMs are good ways to avoid charges like these, but banks are required to disclose certain fees it charges. Take a look at the fee schedule for any particular type of account you are thinking of opening and get acquainted with the details.

Benefits of Checking Accounts

There are many advantages to having a checking account, including:

• You can pay bills and transfer funds online, in person, or by app; there’s no need to carry around cash for such transactions. Checking accounts can make money management very convenient.

• Checking accounts are typically insured by the FDIC (or, if you bank with a credit union, NCUA), so your money is safe. Even if the financial institution were to go out of business, you wouldn’t lose your money up to $250,000 per account holder, per account ownership category, per insured institution.

• Checking accounts can be an affordable way to conduct financial transactions. For instance, your account is likely to come with checks, which can save you the effort and expense of using money orders or other types of payments in many situations.

• Your checking account may offer rewards, such as cash back opportunities, or if you apply for a loan at the same institution, you may get a better rate.

Recommended: Ways to Avoid Overdraft Fees

The Takeaway

Yes, there are significant differences between checking and savings accounts. They serve quite separate purposes (spending vs. saving) and can be useful in working toward varied financial goals. For many people, however, it’s not a question of which kind of account to open, but where’s the best place to open both.

When you’re looking for the best banks for checking and savings accounts, see what SoFi can offer.

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.

3 Great Benefits of Direct Deposit

It’s Faster

As opposed to a physical check that can take time to clear, you don’t have to wait days to access a direct deposit. Usually, you can use the money the day it is sent. What’s more, you don’t have to remember to go to the bank or use your app to deposit your check.

It’s Like Clockwork

Whether your check comes the first Wednesday of the month or every other Friday, if you sign up for direct deposit, you know when the money will hit your account. This is especially helpful for scheduling the payment of regular bills. No more guessing when you’ll have sufficient funds.

It’s Secure

While checks can get lost in the mail — or even stolen, there is no chance of that happening with a direct deposit. Also, if it’s your paycheck, you won’t have to worry about your or your employer’s info ending up in the wrong hands.

FAQ

Are interest rates variable on savings and checking accounts?

Savings and checking accounts virtually always have variable interest rates.

Are checking or savings accounts insured?

Yes, both checking and savings accounts are usually insured by the FDIC (or NCUA) for up to $250,000 per account holder, per account ownership category, per insured institution.

Is it better to have most of your money in a savings or checking account?

When comparing checking vs. savings accounts, know this: If you have a chunk of the money that will sit in the bank for a period of time, a savings account can be a wise choice since it will earn interest.

Photo credit: iStock/AleksandarNakic

¹SoFi Bank is a member FDIC and does not provide more than $250,000 of FDIC insurance per legal category of account ownership, as described in the FDIC’s regulations. Any additional FDIC insurance is provided by banks in the SoFi Insured Deposit Program. Deposits may be insured up to $2M through participation in the program. See full terms at SoFi.com/banking/fdic/terms. See list of participating banks at SoFi.com/banking/fdic/receivingbanks.

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.

SOBK0324012

Source: sofi.com

Apache is functioning normally

March 23, 2024 by Brett Tams

If you’re running a business, you probably know that managing cash is critical to your success — so let’s share some tips on doing that even better. Solid cash flow is vital to keep a business thriving, whether you’re a sole proprietor or the head of a larger enterprise. Even businesses with strong earnings can struggle with cash flow. That’s why cash flow can be a sure sign of how healthy a business is — or is not.

So let us help you optimize that cash flow. We’ll share some smart insights and helpful tips on:

• What cash management for business is

• Why it’s so important

• Ways you can improve your business cash management

Let’s get started.

What is Business Cash Management?

Simply put, business cash management is basically the way you track and manage the money coming into and going out of your business – usually on a cash flow statement. Positive cash flow means more money is coming in through revenues or borrowing than is being used to pay expenses, such as payroll and rent.

That said, good cash management also means not having too much cash on hand. In that scenario, business owners, while cautious, may be missing out on future earnings growth when they neglect to invest cash back into the business.

Here’s another way to frame this principle: Take a look at your business’s balance sheet and check the ratio of current liquid assets to liabilities. A ratio that’s greater than one indicates good health (you’re not losing money), but if that ratio gets too high, you could be holding onto too much cash or other assets that could better be invested elsewhere.

💡 Quick Tip: Help your money earn more money! Opening a bank account online often gets you higher-than-average rates.

The Importance of Cash Management for Businesses

Cash flow is the essence of all businesses. Without cash, a business will struggle to meet expenses, pay suppliers, repay any investors, and, often most importantly, grow the business through marketing and/or new opportunities.

Strong cash management strategies can help business owners avoid taking on debt. It also gives them more control over everyday activities, decisions, and growth opportunities. What’s more, smart cash management is the best way for owners to fulfill their vision for their enterprise while meeting both their short, intermediate and long-term needs. There’s certainly a lot riding on cash management, so let’s dive into ways to optimize it.

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!

6 Tips for Managing Cash Flow

Cash management can be especially challenging for entrepreneurs and small business owners. Yet it is one of the most important financial strategies business owners must master. These six tips can help.

1. Learning Your Cash Flow Cycle

A cash flow cycle is the time it takes to purchase your supplies and materials (or prepare the work that goes into providing a service), transform them into a product, sell your offering, and collect payment that can go into your business bank account. Sounds simple but a lot can go haywire during that process.

That’s why it’s important for business owners to constantly update and monitor their balance sheets and profit and loss statements. Ideally, you want to know at any given time what happened in the cash-flow cycle last month. Also important: Knowing your projections for what’s going to happen next month.

Understanding your cash flow cycle can help identify and address inconsistencies such as a late-paying customer or a build-up of inventory. If your business is seasonal or cyclical, you want to be well-prepared for both the intensely busy times…and the lulls.

Recommended: How to Track Your Monthly Expenses: Step-by-Step Guide

2. Getting Payments on Time

Reminding customers to pay on time is one of the easiest but most necessary ways to manage cash flow. Late payments are a fact of life; common, even. Having receivables come in even a day or two past the due date can wreak havoc with your cash flow cycle and your bank account.

Consider setting up email reminders to all customers ten days, seven days, and two days before payment is due. Technology today makes it a snap to pre-schedule email blasts. If the payment is still late or only a partial payment was made, don’t hesitate to follow up with a personal note or phone call.

This simple solution can really work. Customers will pay more attention to timely payments when they know you are paying close attention.

3. Turning Over Inventory Quickly

Having an abundance of inventory on hand at a given time means that a bundle of cash is tied up in that unsold stock. That could be an issue, because those funds might otherwise be working to pay for operations and expenses. What’s more, if all of that inventory bought upfront doesn’t sell as expected, it could mean losses on top of that lack of cash. That could hurt your growth and business valuation.

Many small business owners have learned that, in terms of cash, it’s better to turn inventory more quickly. Of course, this will vary widely depending on your business – perhaps your product is handmade jewelry, perhaps its reconditioned air conditioners. As an example, you might want to boost inventory turn-over from twice a year to five times. More targeted marketing could contribute to this acceleration.

That said, finding the right inventory management to fit with your cash flow cycles takes some time and experience. Recent supply chain issues have shown how challenging inventory management can be. Again, constant monitoring of the cash flow cycle can help guide how you tweak things.

Recommended: How Much Does It Cost to Start a Business?

4. Understand Invoice Financing

Let’s say you hit a cash management hitch. If you do find yourself in a position where you have too much inventory on hand and you need cash to cover expenses, there is a path forward. Invoice financing companies will advance a full or partial amount of your outstanding invoices. You repay that amount plus interest after the invoice is paid.

This generally should only be considered as a stop-gap measure. Like credit cards, interest payments on invoice financing can add up fast and quickly get out of control. Consider the fact that annual percentage rates for invoice financing products can reach as high as a jaw-dropping 64%.

5. Cutting Costs

Monitoring and cutting costs on expenses is another tool for managing cash flow. After all, if less cash goes to pay overhead, more can be invested in the business. A few suggestions: Relying on online marketing efforts that can be less costly than traditional methods, outsourcing tasks that take too much time and money in-house, and reducing energy costs. You might also want to renegotiate outdated contracts and prices with suppliers. These are all areas business owners can consistently monitor to keep costs low.

💡 Quick Tip: Are you paying pointless bank fees? Open a checking account with no account fees and avoid monthly charges (and likely earn a higher rate, too).

6. Comparing Loans

Sometimes, a business could use a helping hand to smooth out its cash flow. Let’s say you have outstanding accounts receivable — in other words, you know money is due but you don’t have it yet — and you need the cash now. In this situation, taking a business loan can be an option to help bridge the gap.

Cash flow loans (like invoice financing explained above) are short-term loans or lines of credit. These are often used to cover expenses or to take advantage of opportunities that can increase revenue.

A working capital loan is another option that can be used to finance everyday business operations such as rent, payroll, or restocking inventory. These loans are not designed to finance long-term assets or investment. Companies with seasonal or cyclical sales often rely on working capital loans to provide relief during slow periods.

One caveat: Working capital loans are often tied to your personal credit, so missed payments or defaults will affect your credit score. Consider that carefully before you sign on.

In addition, there are a variety of small business loans available that are used to finance long-term expenses such as real estate, equipment purchases, or business expansion. These include SBA loans, business lines of credit, and term loans.

Whatever type of loan you choose, be sure to compare your options carefully. Look at terms, APR, and how much lending you qualify for among several lenders before taking on any short or long-term debt. Spending some time and energy on research will help ensure you get the right form of financing.

The Takeaway

Cash flow management is an essential part of running a successful business of any size. Carefully monitoring cash flow, and learning some simple strategies to maximize it can take your small business to the next level.

Whether your business is a full-time job or just a side gig, it’s important to keep your business cash flow separate from your personal cash flow. In both cases, you’ll want to find a bank account that pays a competitive rate, charges no or low fees, and makes it easy to access your money.

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.

Photo credit: iStock/AlexSecret

Our account fee policy is subject to change at any time.
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.

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Source: sofi.com

Apache is functioning normally

March 23, 2024 by Brett Tams

The Hilton Honors American Express Aspire Card is a premium card that comes with a number of benefits, including Hilton Honors™ Diamond Status, a $400 Hilton resort credit, a $200 airline credit and more. Terms apply.

Hilton and American Express recently updated the Hilton Honors American Express Aspire Card benefits so that cardholders can earn free Hilton award nights. Below we’ll dive into whether it’s worth taking advantage of this new benefit.

How to earn free hotel nights with the card

In the first year of your card membership and every year at renewal.
New: After making $30,000 in purchases on your Hilton Honors American Express Aspire Card in a calendar year.
New: After making $60,000 in purchases on your Hilton Honors American Express Aspire Card in a calendar year.

Terms apply.

While you’ll continue to earn at least one free award night each year with your Hilton Honors American Express Aspire Card, is it worth spending up to $60,000 for extra free nights?

Spending $30,000 to earn a free reward night

If you’re able to maximize the value of the free award night, it may very well be worth spending $30,000 on the Hilton Honors American Express Aspire Card to earn an extra free reward night. Terms apply.

14 points for every $1 spent at a Hilton property.
7 points for every $1 spent on flights booked directly with airlines, travel booked on amextravel.com, on select car rental companies and at U.S. restaurants.
3 points for every $1 spent on everything else.

Terms apply.

This means that, at a minimum, you’ll earn 90,000 Hilton Honors points by spending $30,000 on your Hilton Honors American Express Aspire Card.

Those 90,000 points would be worth approximately $450, given NerdWallet valuations. This comes out to be a 1.5% return on that $30,000 spend. That said, you have the potential to earn even more points if your $30,000 in spend includes money spent on a Hilton stay or on the 7x categories listed above.

The opportunity cost

This comes out to a minimum return of 2.8% if you spend that $30,000 on the Capital One Venture X Rewards Credit Card.

When it could still make sense

Even though the points you earn from the Hilton Honors American Express Aspire Card may be worth less than the amount you’d earn with other cards, this doesn’t take into account the value of the free Hilton award night you’d get after spending $30,000 on your card in a calendar year. If you’re able to maximize the value of your free award night with Hilton, the math can change completely. Terms apply.

For example, you could use your free award night to book a standard room at the Waldorf Astoria Maldives Ithaafushi — when we checked, the cheapest stay cost $2,735 after taxes and fees.

🤓Nerdy Tip

Hilton award stays waive resort fees.

If you take the $2,735 for the free award night and add the $450 in value you’d otherwise earn from spending $30,000 on the Hilton Honors American Express Aspire Card, this comes out to $3,185 worth of earnings on the card, or an impressive return of 10.6% for every $1 spent on the card. (Keeping in mind that you probably wouldn’t fly to the Maldives for a one-night hotel stay.)

The math is very different if you use your free award night for a less expensive hotel. For example, if you used the free award night at the Hampton Inn Dalton in Georgia, the cash price of the same night would only be around $123, including taxes and fees.

If you take the $123 for the free award night and add the $450 in value you’d otherwise earn from spending $30,000 on the card, this comes out to $573 worth of earnings, or a return of 1.9% for every $1 spent. This is less value than if you had the same spend on the Capital One Venture X Rewards Credit Card.

The bottom line is that it’s only worth spending $30,000 on your Hilton Honors American Express Aspire Card if you can maximize the value of the free award night by booking a stay at an otherwise expensive property.

Spending $60,000 to earn two free reward nights

You’ll want to do similar math to determine whether it’s worth spending $60,000 on your Hilton Honors American Express Aspire Card to earn two free award nights (since you earn one free award night after $30,000 in spend and a second free award night after you hit $60,000 in spend).

If you spend $60,000 on your Hilton Honors American Express Aspire Card, you’ll earn a minimum of 3 points per $1 spent, or 180,000 points worth $900 per NerdWallet’s valuation — a return of 1.5% for every $1 spent on the card. Terms apply.

If you’re able to maximize your free award nights at high-value Hilton properties, it could again make sense to spend $60,000 on your Hilton Honors American Express Aspire Card.

When should you skip it?

Below are some scenarios where spending $30,000 (or $60,000) on your Hilton Honors American Express Aspire Card to earn free award nights may not make sense:

You may not use the award night, since they generally expire within one year.
You may not use the award night at a high-cost property.
You are instead putting that spend toward a credit card that offers a high sign-up bonus.
You’d rather get a credit card that includes airline or hotel status.
You have The Hilton Honors American Express Business Card, where you earn a free award night after spending only $15,000 in a calendar year. Terms apply.

Since there’s no one-size-fits-all solutions, you’ll want to think about how you’ll use your Hilton free award nights compared to how you’d earn points used on another credit card before deciding to commit to the $30,000 or $60,000 spend requirements on the Hilton Honors American Express Aspire Card.

The bottom line

Hilton and American Express updated the Hilton Honors American Express Aspire Card so that you can now earn an additional free award night after spending $30,000 on the card in a calendar year, or earn two additional free award nights after spending $60,000 on the card in a calendar year. It’s only worth taking advantage of this benefit if you plan to redeem the Hilton free night awards at a high-value Hilton hotel.

Given that, you should carefully think about how you’ll use the free award night certificates before committing to spending the $30,000 or $60,000 needed to get the free Hilton award nights on your Hilton Honors American Express Aspire Card. Terms apply.

All information about Hilton Honors American Express Aspire Card has been collected independently by NerdWallet. Hilton Honors American Express Aspire Card is no longer available through NerdWallet.

How to maximize your rewards

You want a travel credit card that prioritizes what’s important to you. Here are our picks for the best travel credit cards of 2024, including those best for:

Source: nerdwallet.com

Apache is functioning normally

March 22, 2024 by Brett Tams

The Capital One Venture Rewards Credit Card has long been a mainstay for travelers seeking low-effort rewards for a relatively modest annual fee. It touts a generous sign-up bonus, the same rewards rate for most purchases, flexible rewards redemption options and additional travel benefits that boost its value.

The Wells Fargo Autograph Journey entered the credit card marketplace in March 2024, but it’s quickly catching up with the Capital One Venture Rewards Credit Card. You can earn a sign-up bonus and elevated rewards in certain spending categories. Redeeming your rewards is easy with this card, too. Plus, it provides impressive travel protections.

Which card is right for you comes down to which perks you value the most. Here’s how to decide.

Why you might prefer the Capital One Venture Rewards Credit Card

Compared with other travel credit cards that have convoluted rewards programs, the $95-annual-fee Capital One Venture Rewards Credit Card has always kept earning and redeeming miles super simple.

Flat rewards rate

The Capital One Venture Rewards Credit Card earns:

2 miles per dollar spent on purchases.
5 miles per dollar on hotels and car rentals booked through Capital One’s travel portal.

For the most part, there are no spending categories to memorize — just a decent rewards rate no matter where you use the card. If you want travel rewards that keep it simple, this is hard to beat.

Sign-up bonus

Enjoy a one-time bonus of 75,000 miles once you spend $4,000 on purchases within 3 months from account opening, equal to $750 in travel. That’s a lot of value in the first year you carry this card.

Flexible redemptions

There are multiple ways to use your miles:

Cover the cost of travel purchases made within the past 90 days. Eligible travel purchases include airlines, hotels, trains, buses, rental cars, cruises, taxis and limousine services, travel agents and timeshares.
Redeem miles on Capital One’s travel portal for flights, car rentals and hotel bookings.
Transfer rewards to other eligible Capital One cards.
Transfer rewards to Capital One’s airline and hotel transfer partners.

Full list of Capital One transfer partners

Aeromexico (1:1 ratio).
Air Canada (1:1 ratio).
Air France-KLM (1:1 ratio).
Avianca (1:1 ratio).
British Airways (1:1 ratio).
Cathay Pacific (1:1 ratio).
Emirates (1:1 ratio).
Etihad (1:1 ratio).
EVA (2:1.5 ratio).
Finnair (1:1 ratio).
Qantas (1:1 ratio).
Singapore Airlines (1:1 ratio).
TAP Air Portugal (1:1 ratio).
Turkish Airlines (1:1 ratio).

Accor (2:1 ratio).
Choice Privileges Hotels (1:1 ratio).
Wyndham Rewards (1:1 ratio).

You can also redeem miles for cash back or gift cards, but redemption values vary, so this isn’t an ideal way to use your rewards.

Travel and entertainment extras

The Capital One Venture Rewards Credit Card offers a statement credit of up to $100 to cover the cost of TSA PreCheck or Global Entry every four years. You’ll also get Hertz Five Star status, which offers a wider selection of rental cars, upgrades when available and more.

Get access to VIP event experiences and ticket presales through Capital One Entertainment. You can also book tables at in-demand restaurants and attend special events through Capital One Dining.

Why you might choose the Wells Fargo Autograph Journey instead

Like the Capital One Venture Rewards Credit Card, the Wells Fargo Autograph Journey has a $95 annual fee and travel-focused rewards. While it lacks a statement credit for TSA PreCheck or Global Entry, the card offers other benefits, including robust travel protections.

Higher rewards in specific categories

The Wells Fargo Autograph Journey earns:

5 points per $1 on hotels.
4 points per $1 on airlines.
3 points per $1 on other travel and dining.
1 point per $1 on other purchases.

That’s a bit more complicated than the flat rate on most purchases with the Capital One Venture Rewards Credit Card, but it’s potentially more rewarding if you spend more on travel and dining specifically.

Welcome offer

Earn 60,000 bonus rewards points after spending $4,000 in the first 3 months. That’s not as generous as the sign-up bonus on the Capital One Venture Rewards Credit Card, but it’s still a nice bonus if this is the card you choose.

Flexible redemptions

Redeem rewards for not just travel, but also statement credits to offset eligible purchases, gift cards, charitable donations and merchandise. You can also pay with points at select merchants.

Another option is to transfer points to Wells Fargo’s airline and hotel partners. It’s a relatively short list for now, but according to Wells Fargo, there are plans to expand it.

Full list of Wells Fargo transfer partners

Travel and entertainment extras

The Wells Fargo Autograph Journey lacks a TSA PreCheck/Global Entry credit, but it does offer a $50 annual statement credit for airfare purchases. The Capital One Venture Rewards Credit Card offers no such credit toward airfare.

Plus, with the Wells Fargo Autograph Journey, you’ll have robust travel protections, including a reimbursement of up to $15,000 if your trip is canceled for a covered reason.

You can also take advantage of Autograph Card Exclusives, which is a series of concerts in small venues.

Cell phone protection

If you pay your cell phone bill with your Wells Fargo Autograph Journey, you’re covered if your phone is stolen or damaged. You can claim up to $1,000, with a maximum of two claims per year.

Which card should you get?

When you compare these two cards, it comes down to rewards earnings and perks. Opt for the Capital One Venture Rewards Credit Card if you prefer simple rewards and want to save on TSA PreCheck or Global Entry.

The Wells Fargo Autograph Journey may be a better match if you want to earn more rewards on certain spending and you’d like enhanced travel and cell phone protections.

Source: nerdwallet.com

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