By Peter Anderson1 Comment – The content of this website often contains affiliate links and I may be compensated if you buy through those links (at no cost to you!). Learn more about how we make money. Last edited September 5, 2013.
About 2 weeks ago my wife and I closed on the sale of the house we had lived in for the past 7 years. We loved our old house, but we knew it was time to do a slight upgrade since the rates were starting to go up, and we had an opportunity for my in-laws to build us a custom home on a beautiful tree lined lot, in a neighborhood we loved. We would also now have a yard, which was something we didn’t really have at our old house. So this summer we built that new house and then closed on it the same day as we sold our old house.
When we started the process of trying to find a new home loan with which to buy the new house, we realized that we would want to make sure that we stayed on top of our credit situation, that we only did things to maximize our credit score, and that we got the best rate possible on the house. For the most part we were able to do that, and we got the lowest possible rate at the time because our excellent credit scores put us in the highest tier for the best rates.
Now that we’ve closed on the house, and we don’t anticipate using any further credit anytime in the near future, should we even care about or keep track of our credit scores?
Maintaining And Improving Our Credit In Preparation For A Home Loan
Checking our credit scores on a regular basis was something we did through the spring and summer this year as we prepared to buy a new house. Some of the places that we checked our credit scores and got our credit reports include:
Credit Karma: They will give you your TransUnion credit score for free, along with a suite of other credit tools.
Credit Sesame: They will give you an Experian credit score for free, along with a bunch of other financial, credit and loan tools.
Quizzle: They’ll give you an Experian credit score, along with your full credit report for free!
Equifax: Get your Equifax score for free by signing up for a free 30 day trial. Don’t forget you’ll need to cancel.
MyFICO: Get your actual FICO credit score and credit report with a free trial. Just don’t forget to cancel! I almost did!
AnnualCreditReport.com: Get your credit report annually for free from each of the big three credit reporting agencies. If you want to, you can pay a little bit and get your FICO score as well. (Or just do a free trial at MyFICO to get it for free)
We stayed on top of our credit by doing the things they say to do in order to improve your credit scores. We did things like making sure our payments got in on time, we didn’t sign up for a bunch of new cards, we maintained existing aged accounts, we didn’t over-utilize our credit and we used and paid off several different types of credit.
Home Loan Closed, Best Rate Received
Our hard work over the years means we both had great credit scores, and we knew we would most likely be approved for a loan, in the best rate tier.
We ended up finding and working with a mortgage company that ended up giving us the lowest rate possible at the time, 3.875%. Our credit scores showed we were responsible with credit and were a good risk for them to take – without adding any points to our rate.
Mission accomplished.
Now That We’ve Closed On Our House, Should We Even Care About Our Credit?
We’ve now closed on that loan, and we got the best rate available. Since we won’t need to take out any new loans or credit in the foreseeable future, should we even care about or focus on our credit anymore? Does it even make a difference if we aren’t going to need a good credit score for anything?
I don’t think we’ll be as hyper vigilant about our credit now, but that isn’t to say that we won’t continue our responsible use of credit.
Things A Good Credit Score Can Help With
Here are some reasons you may want to stay on top of your credit:
Good credit can help get better insurance rates: You can sometimes get lower homeowners and auto insurance rates if you have good credit.
Good credit help you get a job: Sometimes employers will check an applicant’s credit to get an indication that they’re reliable and responsible.
Good credit help you when signing up for new accounts: Some utilities may waive hefty deposits or lower rates if you have good credit, or cell phone companies may offer a better plan.
Good credit will help you if you need to move: If you need to move to a new house, or end up renting, having good credit will help you to get a loan, or to be approved as a renter.
What are your thoughts? Do you care about your credit score, and do you take steps to ensure that your credit stays good, or that it improves?
Thanks to new data, it’s time to take a fresh look at the top mortgage lenders in California in 2022.
The Golden State is by far the biggest market for home loans, accounting for something like 16% of the overall market.
Nowhere else even comes close, including heavyweights like Florida and Texas, with about 8% market share. Or New York with about 5%.
As you might expect, the big household names make this list, and many are also on the top-10 list nationwide.
Let’s take a look at who topped the rankings, and break it down by home purchase financing and mortgage refinancing.
Top 10 Mortgage Lenders in California (Overall)
Ranking
Company Name
2022 Loan Volume
1.
UWM
$34.9 billion
2.
Wells Fargo
$30.4 billion
3.
First Republic Bank
$27.0 billion
4.
Chase
$25.1 billion
5.
Rocket Mortgage
$24.1 billion
6.
Bank of America
$18.4 billion
7.
U.S. Bank
$13.9 billion
8.
loanDepot
$11.5 billion
9.
Citi
$9.5 billion
10.
Union Bank
$9.5 billion
In 2021, Rocket Mortgage, formerly known as Quicken Loans, was the top mortgage lender in California, according to HMDA data from Richey May.
But in 2022, United Wholesale Mortgage (or UWM for short) took the top spot with $34.9 billion funded.
That isn’t a huge surprise as they have also been the top mortgage lender nationally for a couple quarters now as well.
The Pontiac, Michigan-based company managed to grab a 6.5% market share in CA, despite solely working with mortgage broker partners.
They handily beat out their crosstown rivals Rocket Mortgage by about $10 billion, which dropped to the fifth spot.
In second was San Francisco-based Wells Fargo with $30.4 billion, followed by now-defunct First Republic Bank with $27 billion.
That’s also pretty impressive given the fact that UWM only works with mortgage brokers, as opposed to operating a consumer direct channel.
Coming in fourth was Chase, which incidentally acquired First Republic Bank. Talk about consolidation at the top!
They’ve been a big mortgage player for years since acquiring Washington Mutual about the housing crisis back in 2008.
Also in the top 10 were Bank of America, U.S. Bank, loanDepot, Citi, and Union Bank.
For the record, Union Bank was acquired by U.S. Bank, so even more consolidation!
Speaking of banks, seven of the 10 biggest mortgage lenders in California were depository banks, with the remainder nonbanks.
Altogether, more than $500 billion in home loans were originated in the state last year, down from around $1 trillion the year prior.
So about 40% of mortgage volume in California came from these ten companies.
Top California Mortgage Lenders (for Home Purchases)
Ranking
Company Name
2022 Loan Volume
1.
UWM
$22.4 billion
2.
Wells Fargo
$19.1 billion
3.
First Republic
$15.5 billion
4.
Chase
$12.8 billion
5.
Rocket Mortgage
$10.9 billion
6.
Bank of America
$8.3 billion
7.
U.S. Bank
$8.2 billion
8.
Citi
$6.7 billion
9.
loanDepot
$6.5 billion
10.
Guaranteed Rate
$5.2 billion
Now let’s look at the top purchase mortgage lenders in the Golden State, which grabbed about 60% of the market in 2022 as refis waned.
This list is a little bit different because some lenders specialize in home purchase financing, while others cater to existing homeowners looking to refinance.
Topping this list was UWM with $22.4 billion, their second year holding this honor. They once again beat out Wells Fargo with $19.1 billion, while First Republic climbed to third with $15.5 billion.
First Republic ramped up their mortgage lending quite a bit in 2022, and that may have been what ultimately ended them.
Chase took the fourth spot with $12.8 billion, while Rocket Mortgage snagged fifth with $10.9 billion.
Also in the top 10 were Bank of America, U.S. Bank, Citi, loanDepot, and Guaranteed Rate.
The only lender in this list that wasn’t in the main list was Guaranteed Rate, replacing Union Bank.
Going forward, lenders will want to focus on this part of the market if mortgage rates remain inflated relative to recent lows.
Simply put, it’s difficult to drum up refinance business when many homeowners have fixed rates in the 2-4% range and the going rate is 6-7%.
Top California Mortgage Lenders (for Refinance Loans)
Ranking
Company Name
2022 Loan Volume
1.
Rocket Mortgage
$12.7 billion
2.
UWM
$12.5 billion
3.
Chase
$11.3 billion
4.
Wells Fargo
$10.3 billion
5.
First Republic Bank
$9.5 billion
6.
Bank of America
$8.4 billion
7.
U.S. Bank
$5.0 billion
8.
loanDepot
$4.9 billion
9.
Union Bank
$3.9 billion
10.
Homepoint
$3.6 billion
Now let’s talk refis, which were all the rage in 2021, but have since fallen out of favor due to unprecedented increases in mortgage rates.
In this category, Rocket Mortgage ran away from the competition with an eye-watering $78.3 billion in loan origination volume in 2021.
But a year later, the picture was a lot different. They funded just $12.7 billion in refis, which still made them #1.
However, their crosstown rival UWM came in a very close second with $12.5 billion in refi loan volume.
Depository banks Chase and Wells Fargo snagged third and fourth with $11.3 billion and $10.3 billion, while First Republic Bank jumped up to fifth with $9.5 billion.
Again, that may be why they no longer exist – too many ultra-cheap mortgages handed out to wealthy clients.
Bank of America, U.S. Bank, loanDepot, Union Bank, and Homepoint took spots six through 10, which was quite different than a year earlier when names like Nationstar (Mr. Cooper) and Freedom Mortgage appeared.
Citibank was nowhere close when it came to refis, despite being a top home purchase lender in California. They did just $2.4 billion in refinances.
Top Mortgage Lenders in Los Angeles
Ranking
Company Name
2022 Loan Volume
1.
Chase
$8.1 billion
2.
First Republic Bank
$7.5 billion
3.
UWM
$6.2 billion
4.
Wells Fargo
$4.9 billion
5.
Rocket Mortgage
$4.3 billion
6.
Bank of America
$3.9 billion
7.
Citi
$2.7 billion
8.
City National Bank
$2.6 billion
9.
U.S. Bank
$2.2 billion
10.
Union Bank
$2.2 billion
Top Mortgage Lenders in San Diego
Ranking
Company Name
2022 Loan Volume
1.
UWM
$3.3 billion
2.
Rocket Mortgage
$1.6 billion
3.
Wells Fargo
$1.6 billion
4.
Chase
$1.6 billion
5.
First Republic Bank
$1.5 billion
6.
Mission FCU
$1.0 billion
7.
U.S. Bank
$912 million
8.
Bank of America
$787 million
9.
Union Bank
$766 million
10.
San Diego County CU
$736 million
Top Mortgage Lenders in San Jose
Ranking
Company Name
2022 Loan Volume
1.
Wells Fargo
$4.3 billion
2.
Bank of America
$2.4 billion
3.
PNC Bank
$1.7 billion
4.
First Republic Bank
$1.5 billion
5.
U.S. Bank
$1.3 billion
6.
Chase
$1.1 billion
7.
Citi
$1.1 billion
8.
Rocket Mortgage
$981 million
9.
Union Bank
$726 million
10.
UWM
$611 million
Top Mortgage Lenders in San Francisco
Ranking
Company Name
2022 Loan Volume
1.
Wells Fargo
$7.0 billion
2.
First Republic Bank
$6.4 billion
3.
Bank of America
$4.1 billion
4.
Chase
$2.8 billion
5.
PNC Bank
$2.5 billion
6.
U.S. Bank
$2.0 billion
7.
Citi
$1.9 billion
8.
Rocket Mortgage
$1.5 billion
9.
Union Bank
$1.4 billion
10.
UWM
$1.1 billion
Does Size Matter When It Comes to Getting a Mortgage?
As I always ponder with these top lender lists, does size actually matter?
Does it mean anything that your bank or lender is massive and bigger than others?
While that might be up for debate, as some could argue that a big institution might be more reliable or efficient or even cheaper, the opposite could also be said.
Ultimately, it’s nice to know who the big players are, but your personality might be better suited to a local credit union or mom-and-pop mortgage broker.
The mortgage lender you choose doesn’t have to be the biggest out there to provide exceptional service and competitive pricing.
Conversely, you might find a household name that does offer all those things mentioned above.
At the end of the day, obtaining a home loan is a big deal and it should be shopped accordingly.
That means lots of research and multiple quotes before you make your final decision.
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Nuclear fusion may well be the technology of the future.
Not a technology. For many engineers, if physicists can ever crack the secrets of fusion, it may be to the 21st century what coal was to the 19th and petroleum was to the 20th. This could become a new ubiquitous technology, a part of infrastructure found on every part of the globe.
For investors, there’s enormous potential here. If you’re looking to understand how the technology of the future can power your own retirement as well, read on.
For help building a balanced investment portfolio, consider working with a financial advisor.
Nuclear Fusion Basics
Nuclear fusion energy is the idea of generating electricity from combining two atoms to create a new one. When two atoms fuse, the resulting atom has slightly less mass than the sum of its parts. This is due to the weak nuclear force, a form of mass/energy which binds subatomic particles together into atoms. Each atom has its own binding energy, so when two atoms are combined into a single entity this leftover binding energy is released as lost mass from the resulting atom. That generates the heat of a fusion reaction.
Fusion is the corollary to fission, the other currently understood source of nuclear energy. With fission, you create a reaction that splits a large atom into two smaller atoms. With fusion, you create a reaction that joins two smaller atoms into a larger one. Fission is rarely found in nature at large scale, but fusion is the power source for stars.
As a power source, fusion has many benefits over fission.
First, fusion is far safer than fission. Once you start a fission reaction, you must actively control it or it can flash consume all of its fuel in an explosive event. The hydrogen that fuels a fusion reaction, on the other hand, can be added as its consumed, meaning that the entire reaction will cease if you simply stop adding fuel. After a reaction, fission leaves behind highly toxic radioactive waste that can even be weaponized in the wrong hands. Fusion leaves behind helium, an inert and harmless gas that the world could actually use more of.
Fission is powered by relatively rare and expensive enriched uranium. Fusion is powered by an isotope of hydrogen, the most common element in the universe.
To top it all off, fusion generates more power than any other known process. With an equivalent amount of fuel, a fusion reactor can generate four times as much electricity as the fission reactors that current nuclear power plants use. That same fusion reactor can generate 4 million times as much energy as a chemical plant powered by coal or oil.
Fusion’s Problem
The basis behind a fusion reaction is what’s known as “the bottle.” It’s not currently possible to wrap up even tiny stars in a physical reactor. Any solid material would vaporize right away. Instead, the fusion reaction takes place inside a high-energy plasma. That plasma, in turn, is contained by a series of powerful magnetic fields. These shaped magnetic fields are called “the bottle.” The bottle contains and directs the heat of the fusion reaction, making it safe and productive.
The problem is that, with current technology, it takes more energy to sustain the magnetic bottle than the fusion reaction produces. The hotter you burn the reactor, the more energy it takes to keep the reaction contained. The result is energy-negative.
That’s changing however. Advances in several different fields, from mathematics to superconductors, are making it steadily more efficient to generate the magnetic bottle that contains and sustains a fusion reaction, and in 2022 the Lawrence Livermore National Laboratory made a credible claim to have generated a positive-sum reaction.
Investing In Fusion Through Companies
Investing in fusion is not easy. Since this is a developing technology, any investment in this field is fundamentally speculative. There are no publicly traded companies that operate fusion reactors, because no commercial fusion reactors exist yet. You can’t have an industry around a product that only exists as a very convincing theory.
That said, this is still a billion-dollar industry, with around $4.8 billion invested as of 2022. While much of that work is being done by government and university labs, there are several dozen private startup companies that are trying to develop their own reactors. Firms like Helion Energy and Commonwealth Fusion Systems have generated hundreds of millions in investment capital. Unfortunately for individual investors, they remain private companies. If you are an accredited investor, you can look for shares that someone might be willing to sell. Otherwise, it’s not currently possible to buy into a fusion company directly.
Instead, you have two major options.
Invest In Investors
First, you can invest in publicly traded companies that have themselves invested in fusion companies.
This is a technology that promises to fundamentally change the energy economy from the ground up, and the big players aren’t sitting that out. Major technology companies like Alphabet (GOOG) and Amazon (AMZN) have invested in fusion research companies. Lesser-known, but still large, firms like Babcock International (BCKIF) and Cenovus Energy (CVE) have done the same.
These companies have a significant stake in the companies that are trying to develop fusion technology. If those underlying investments pay off, the benefits will extend upward.
Other sources on this subject also recommend investing in firms that can benefit from the results of fusion, namely vast and cheap energy. If you want to do this, we recommend simply investing in the S&P 500. The reality is that virtually every company will benefit from these productivity gains and cost reductions. There’s no good way to pick a clear winner or loser, because all companies rely on energy-intensive resources.
Invest In Energy Companies
However advanced, fusion is still fundamentally an investment in the energy sector. The result is that investors looking to get into this market can do so by taking a long-term position in the energy sector.
You can do this by investing in specific energy source companies like Chevron (CVX). You can also invest in utilities that run power plants, like Duke (DUK) or National Grid (NGG). Or, you can invest in energy-sector funds. These would include mutual funds or ETFs like the Vanguard Energy ETF (VDE) or Global X Renewable Energy Producers (RNRG).
This is a long-term investment. Researchers are confident that fusion will become a viable, long-term energy source, one likely to significantly outlive fossil fuels. It’s not here yet though and, once it arrives, it probably will take quite a while to really take off. This is a good investment for your retirement portfolio, but probably not for the swimming pool fund.
Investing In Fusion Through Materials
Side-investing in nuclear fusion is another potentially good strategy.
Fusion relies on a handful of specialized resources to build its reactors and sustain its burn. The fuel source for fusion will be a mix of hydrogen isotopes called deuterium and tritium, although current experimental reactors only use deuterium. For the science-curious:
Hydrogen atom – An atom with one proton and one electron
Deuterium – An atom with one proton, one neutron and one electron
Tritium – An atom with one proton, two neutrons and an electron
The heavier nuclei of deuterium and tritium make them easier to fuse and release more energy in the process. As an investor, you can seek out companies that produce deuterium gas (tritium is not yet produced in commercial quantities).
You can also seek out desalinization companies. Hydrogen isotopes are generally produced from water, by separating the molecule’s oxygen and hydrogen atoms from each other. To get enough water without wasting potable and agrarian supplies, producers will most likely rely on seawater production, which requires large scale desalinization.
Finally, you can seek out firms that make the components of a reactor itself. On this, we cannot offer specific advice because nobody knows what a working fusion reactor will be made of. Most likely, commercial fusion reactors will rely on superconducting materials to make the core of the electromagnets that contain the reaction. Companies that produce materials like mercury, titanium, niobium alloys, and next-generation ceramics are all good candidates as long-term suppliers for a fusion reactor’s core.
Bottom Line
Investing in fusion may be one of the most solid bets anybody can make on long-term investments in the future. You can do so by investing in companies that are trying to build their own reactors, by investing in the energy sector or by investing in the companies that will someday fuel these reactors.
Energy Investment Tips
Fusion is the big dream of next-generation energy. Before physicists crack that puzzle, though, there are many ways you can invest in next-generation energy right now.
A financial advisor can help you build an investment portfolio that includes fusion investments. SmartAsset’s free tool matches you with up to three vetted financial advisors who serve your area, and you can interview your advisor matches at no cost to decide which one is right for you. If you’re ready to find an advisor who can help you achieve your financial goals, get started now.
Eric Reed
Eric Reed is a freelance journalist who specializes in economics, policy and global issues, with substantial coverage of finance and personal finance. He has contributed to outlets including The Street, CNBC, Glassdoor and Consumer Reports. Eric’s work focuses on the human impact of abstract issues, emphasizing analytical journalism that helps readers more fully understand their world and their money. He has reported from more than a dozen countries, with datelines that include Sao Paolo, Brazil; Phnom Penh, Cambodia; and Athens, Greece. A former attorney, before becoming a journalist Eric worked in securities litigation and white collar criminal defense with a pro bono specialty in human trafficking issues. He graduated from the University of Michigan Law School and can be found any given Saturday in the fall cheering on his Wolverines.
When applying to get life insurance the insurers will look to see if you are a higher risk applicant. And their determination will impact you once you get your quote. Either your premium will be standard or they’ll charge you more depending on what their risk-outcome algorithm states.
When you need to provide more information when applying for life insurance policies, the attending physician statement is the standard way to obtain that information.
Essentially, the attending physician statement (APS) is a report from a doctor or medical facility that either has treated or is currently treating someone that is seeking life insurance.
In applying for life insurance, this is perhaps the top ordered source of background information.
What Exactly Is Your Attending Physician Statement?
The attending physician statement is one of the most difficult and time consuming requirements needed when applying life insurance, but it is also the most sound and proven form of additional background information.
Since the statement can only be written when the doctor has the free time to do so, it can often be weeks or a month for this information to arrive. Once it does, then it can take quite a bit of time to verify for use in the overall medical information history of the person applying life insurance or other policies.
Essentially, when applying life insurance there are numerous medical questions that must be asked in order to secure the type of policy that is sought. If there was a previous medical condition or current treatments underway, then there must be real verification by the attending physician in order to provide the proper perspective.
Evaluating How Risky You Are
When the medical risk to the patient is evaluated, the attending physician’s statement needs not only to be included, but summarized by the underwriter. This summary can vary depending on the underwriter and the style, focus or method that they choose. Quite often, the summary can vary in some detail, but normally the general focus of the statement is held true in the summary.
However, there are times in which the summary can be misleading or even wrong which can greatly affect the position of the insurance policy. In this case, finding an experienced, solid underwriter can make a contrast preparing an accurate summary of the attending physician’s statement. Any missing information, however subtle, can have a powerful effect on whether insurance is approved.
Many underwriters use a template structure, a common form of writing that allows them to summarize the information in a structure that is recognizable. This structure allows for the summary to include all the pertinent information which allows insurance companies to make more proper evaluation about the information presenting in the attending physician’s statement.
How Insurers Interpret Your Attending Physician Statement
Evaluating medical risks is the job of the underwriters when they take the attending physician’s statement. This means using a solid template so that all the pertinent information can be gathered and evaluated properly. The attending physician’s statement is vital to properly evaluating medical risk whether they have occurred in the past or present for insurance companies to make informed decisions.
Insuring that the attending physician statement is accurately summarized is a vital part of providing accurate information to the insurance company when they make decisions about life insurance policies. One mistake or misrepresentation can be costly the person applying for the life insurance or the company itself.
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Do No Medical Exam Plans Still Obtain Physician Statements?
A no medical exam is an excellent option for life insurance coverage for any applicant that has been declined for coverage or has several pre-existing health complications such as diabetes. If it isn’t obvious by now, we’ll let you on a little secret, no med exam is required to get the protection life insurance offers in these plans. There is a lot of confusion about these policies and what information the insurance company will require before they accept your application.
You could apply for a plan with several different companies but results could be all over the place because no insurer has the same requirements for how they handle no medical exam life insurance plan.
For the most part, the insurance company is not going to get a physician statement with a no medical exam plan. With most no medical exam policies, the insurance company will only ask a handful of questions during the application process.
If you’re looking to get life insurance coverage, and you’ve been declined in the past, or you have pre-existing conditions, this plans could be an excellent option for you.
There are some advantages to these no medical life insurance programs to be mindful of as you look for coverage. We want you to get the best plan to meet your needs, and you should compare all of the different options before purchasing a plan.
The first advantage is life insurance is open for all! Health issues? You can get a plan. Pre-existing problems? You can get a plan! with a no medical exam, your health won’t keep you from getting a policy.
Another significant advantage is how quickly a life insurance policy can be issued if you go this route. Since there’s no exam or underwriting the application is normally approved once the payment is received. This certainly helps you out if you’re in a situation where health could decline rapidly in the near future and no life insurance protection is possible or the premiums could be out of your budget.
However, every advantage has its disadvantage, and the biggest one is that these plans will cost more per monnth than a policy that requires a medical exam. The purpose of the exam is to let the insurer know what your overall health is. Without the picture, they are taking a much greater risk by giving you life insurance and by taking that risk it’ll end up hurting your wallet more than you originally realized.
Lastly, is that the insurance company can limit how coverage you can buy. Many companies will only allow you to purchase around $250,000 of life insurance. Unfortunately for many this won’t cover all they need it to. If you need more than this, your only option is buying two of them.
Don’t let some of this knowledge discourage you from buying insurance and protecting your family’s finances from future debt.
Many people have dreams of living in a high-rise apartment in a bustling city, while others want a quiet life, unbothered by anything besides nature. But big city living and secluded country towns aren’t our only options. There’s a happy medium that’s quieter than the city, but more developed than the rural countryside — that’s where suburban neighborhoods come in.
The suburbs are often thought of as quiet, boring areas full of families with small children. While these areas are often filled with families, they aren’t always as uneventful and bland as you might think. Here’s what you should know about suburban neighborhoods and the life suburban residents live.
Suburban defined: What exactly is a suburb?
A suburban area is a cluster of properties, primarily residential, that are not densely compacted, yet located very near an urban area that is. Also referred to as “suburbs,” these areas are often located just outside of larger metro areas but can span even further, according to Pew Research Center.
Suburbs are not urban but still do not have any of the defining characteristics of a rural area like agriculture or open space. Suburban areas portrayed in popular culture often are familial and slow-paced.
The suburbs can suit everyone
Suburban areas are commonly associated with families, and not single people or young couples. However, this common association is really a misconception.
Especially with recent events leading to remote work environments, many young, single professionals are working from home. This has made living in a more mellow area in a spacious home more attractive since there’s room for a separate home office space —much more comfortable than working in a cramped, expensive apartment in the city.
Furthermore, as housing prices in urban areas skyrocket, younger folks are becoming unwilling or unable to pay rent. As a result, they’re moving out of the city and into more suburban areas.
What’s the difference between a suburban and an urban neighborhood?
It sometimes is difficult to distinguish what is a suburban neighborhood vs. an urban one or a rural area. In fact, depending on which definition you choose, the lines can blur. Suburban and urban neighborhoods differ in several key aspects.
Suburban neighborhoods are typically characterized by lower population density and a more spread-out layout. They often offer a quieter and more relaxed atmosphere with a focus on privacy and spaciousness. Suburbs tend to have more green spaces, parks and recreational areas.
On the other hand, urban neighborhoods are known for their high population density and compact living spaces. They offer a vibrant and bustling environment with close proximity to amenities, such as restaurants, theaters and museums.
Suburban neighborhoods
Suburban neighborhoods are typically located within a reasonable commute of an urban area. While they aren’t as densely populated as urban neighborhoods, they do have a fairly large population, although it’s more spread out over areas of single-family homes, rather than stacked-up apartment buildings.
Suburbs are primarily residential areas, although expect some commercial properties and businesses present. Housing is more affordable than in the main city centers and you’ll find larger homes with their own private yards, rather than smaller apartments or condos.
There aren’t as many amenities, such as restaurants or large shopping centers. However, there are grocery stores and usually a few restaurants and additional stores to provide for residents’ needs.
Urban neighborhoods
Urban neighborhoods are in the middle of all the action. They’re in the busy, downtown areas of a larger metro. With the location typically comes apartments and condos, rather than homes with their own yards.
Urban city centers are full of office buildings and commercial businesses. They also have lots of restaurants, shopping and entertainment options within close distance.
But being at the center of it all comes with a price — the cost of living is higher overall, with everything from rent to groceries costing more. Urban areas provide easy access to ample public transportation, which is almost necessary as owning a car is expensive since parking is often paid and spots often are far and few between.
Pros of living in a suburban neighborhood
Living in the suburbs has its benefits and many families choose to reside in such areas for various reasons.
Lower cost of living than in urban areas
Larger homes with bigger yards
Less crowded
Quieter and slower-paced environment
Many suburban areas cater to families specifically and will even have many parks and hiking trails surrounding them. Even if you don’t have a larger family with children, but you enjoy the outdoors or have a dog that likes to play outside, the suburbs better provide the amenities you’ll want.
Cons of living in a suburban neighborhood
While there are many pros to living in a suburban neighborhood, it does lack in some areas.
Less robust public transportation
A little uneventful at times
Fewer jobs available in the area (higher job competition)
Need to travel further for work and entertainment (restaurants, shopping, etc.)
With recent technology, some of these cons aren’t as applicable as they once were. Commuting to work is a major pain point for many living in the suburbs, but with so many companies becoming remote-first, it has eliminated that con for some.
Is suburban living right for you?
Living in the ‘burbs isn’t for everyone — but it is perfect for many folks who crave comfort and convenience. If you enjoy peace and quiet, want to live in a house instead of an apartment and don’t mind commuting to the office (which isn’t an issue if you work remotely), then a suburban neighborhood is a place for you. Find the right place for you today!
With the weather warming up, I thought it’d be prudent to check out “Spring EQ,” a lender that specializes in getting cash out of your home.
By that, I mean they offer cash out refinances and second mortgages, including both home equity loans and lines of credit (HELOCs).
They also partner with other lenders to provide secondary financing, so if you get a combo loan, you might find that they’re your lender on the second mortgage.
Aside from allowing you to tap your home equity, they also offer home purchase financing too, so they’re a full-service lender.
Let’s learn more about them to determine if they could be a good option for your first or second mortgage, or even both.
Spring EQ Fast Facts
Direct-to-consumer nonbank lender that offers first and second mortgages
Including home equity loans and home equity lines of credit
Founded in 2016, headquartered in Philadelphia, Pennsylvania
Currently licensed to do business in 39 states and D.C.
Also operates a wholesale lending division for its mortgage broker partners
Spring EQ is a direct-to-consumer mortgage lender based out of Philadelphia, Pennsylvania that got its start in 2016.
Originally, they sought to transform the home equity lending business model from “a long, drawn-out paperwork based process into a 21st century digital experience.”
This mirrors the efforts currently being made by mortgage lenders that focus on first mortgages, moving from a clumsy, slow process into a digital one powered by the latest technology.
While they got their start originating second mortgages, such as home equity lines and HELOCs, today they also originate home purchase loans and refinance loans.
And they refer to themselves as one of the fastest growing mortgage lenders in the country, though it’s unclear how much volume they did last year.
The company also operates a wholesale lending division for mortgage broker partners, and says it serves customers at other lenders including SoFi, Mr. Cooper, and Roundpoint.
Interestingly, Spring EQ Wholesale utilizes the FICO Score 8 model and encourages its clients to use Experian Boost, which can result in higher credit scores almost instantly and maybe lower interest rates too.
At the moment, they’re licensed to do business in 39 states and the District of Columbia.
They’re not available in Alaska, Hawaii, Idaho, the Dakotas, West Virginia, or Wyoming, but say they’re coming soon to Massachusetts, Missouri, New York and Utah.
How to Apply for a Mortgage with Spring EQ
To get started simply visit their website and click on “Get My Options”
This will allow you to see which loan programs are available
An expert guide (loan officer) will then get in touch to further discuss pricing and options
Once your loan is submitted you can manage it via the online Spring EQ Portal
As noted, Spring EQ has turned to technology to make the process of obtaining a home loan (and home equity loan) more pain-free.
They say you can get pre-qualified in just a minute, and apply online when you’re ready to move forward, using the latest tools to speed up the once-arduous process.
This includes the ability to link financial accounts, scan/upload documents, and eSign disclosures on the fly.
Once your loan is submitted, you’ll be able to manage it via the Spring EQ Portal.
It appears they move quickly, as they say many purchase loans and refinances can close in 20 days or less, while home equity customers can get their money in as few as 11 days.
All in all, the loan process should be mostly electronic and doable from any device, such as a smartphone or desktop computer.
Loan Programs Offered by Spring EQ
Home purchase loans
Refinance loans: rate and term and cash out
Conforming loans backed by Fannie Mae and Freddie Mac
Second mortgages
Home equity loans
Home equity lines of credit (HELOCs)
Spring EQ is similar to other standard mortgage lenders in that they offer home purchase loans and refinances, including rate and term and cash out offerings.
It’s unclear what specific loan programs are available other than the popular 30-year fixed, though I’d imagine a 15-year fixed, and maybe an adjustable-rate mortgage like the 5/1 ARM.
I think they only offer conforming loans backed by Fannie Mae and Freddie Mac, with government loans like FHA/USDA/VA perhaps in the works.
What sets them apart is their second mortgages, something that has become a relative rarity these days.
This includes both home equity loans and HELOCs, the latter of which are lines of credit that allow you to draw more cash over time if needed.
These second mortgages can be used concurrently with a first mortgage to extend financing, in the case of a purchase, or simply as standalone financing.
They say you can borrow up to 90% combined-loan-to-value (CLTV), which is the total of your first and second mortgage balances against the property’s value.
This is higher than what you might be able to obtain via a traditional first mortgage, which could be capped at 80% LTV if backed by Fannie Mae or Freddie Mac.
For example, if you have a $300,000 first mortgage you really like that’s fixed for 30 years at 2.5%, you might be able to borrow an additional $60,000 on a home valued at $400,000.
That way the low interest rate on your first mortgage remains untouched while allowing you to tap equity.
I believe they lend on primary residences, second homes, and investment properties, including condos/townhomes.
Additionally, they serve self-employed borrowers, though required income documents may be more extensive.
Spring EQ Mortgage Rates
One slight negative to Spring EQ is the lack of information regarding mortgage rates and lender fees.
After a visit to their website, I was unable to discover any interest rates listed, nor could I find any lender fees charged.
This doesn’t mean their pricing is good, bad, or in-between, it just means you’ll need to get in touch with a loan officer first to determine your rate.
As such, you may want to give them a call first to discuss eligibility and pricing before signing up via their website.
Obviously, loan pricing is a big part of the equation, so knowing how competitive Spring EQ is relative to other lenders is important.
That being said, they may offer proprietary loan programs that other companies may not be able to match, especially in the second mortgage department.
Spring EQ Reviews
On LendingTree, the company has a solid 4.6-star rating out of 5 from nearly 400 customer reviews, along with an 89% recommended score.
Additionally, Spring EQ was the #1 lender in the home equity category for customer satisfaction in the second quarter of 2020, and top-3 in the third quarter of 2020.
Over at Google, they’ve got a 4.2-star rating out of 5 from nearly 300 reviews, which is also a superior rating.
On Zillow, it’s a similar 4.53-star rating from a smaller sample size of about 55 reviews.
Lastly, they’ve got a 4.47/5 rating on the Better Business Bureau website, which is surprisingly high for a complaint-driven site. And they’re an accredited business with an ‘A+’ rating.
In summary, Spring EQ could be a good choice if you’re interested in a second mortgage, such as a home equity line or loan, and want to keep your first mortgage intact.
This could become a popular trend if and when mortgage rates really begin to rise.
But they also provide home purchase financing now as well, and could structure your loan as a combo to take advantage of better pricing while avoiding costly PMI.
Spring EQ Pros and Cons
The Good Stuff
Can apply for a loan directly from their website in minutes
Provide a fast, digital process and an online borrower portal
Offer second mortgages (HELOCs and home equity loans)
They say many loans close in 20 days or less
Serve both salaried and self-employed borrowers
Excellent customer reviews from past customers across all ratings sites
A+ BBB rating and an accredited business since 2016
This post may contain affiliate links, which helps us to continue providing relevant content and we receive a small commission at no cost to you. As an Amazon Associate, I earn from qualifying purchases. Please read the full disclosure here.
48k salary is a solid hourly wage when you think about it.
When you get your first job and you are making just above minimum wage making over $48,000 a year seems like it would provide amazing opportunities for you. Right?
The median household income is $67,521 in 2020 and decreased by 2.9% from the previous year (source). Think of it as a bell curve with $67500 at the top; median means half of the population makes less than that and half makes more money.
The average income in the U.S. is $48,672 for a 40-hour workweek; that is an increase of 4% from the previous year (source). That means if you take everyone’s income and divided the money out evenly between all of the people.
But, the question remains can you truly live off 48,000 per year in today’s society since it is below both the average and median household incomes. The question you want to ask all of your friends is $48000 per year a good salary.
In this post, we are going to dive into everything that you need to know about a $48000 salary including hourly pay and a sample budget on how to spend and save your money.
These key facts will help you with money management and learn how much per hour $48k is as well as what you make per month, weekly, and biweekly.
Just like with any paycheck, it seems like money quickly goes out of your account to cover all of your bills and expenses, and you are left with a very small amount remaining. You may be disappointed that you were not able to reach your financial goals and you are left wondering…
Can I make a living on this salary?
$48000 a year is How Much an Hour?
When jumping from an hourly job to a salary for the first time, it is helpful to know how much is 48k a year hourly. That way you can decide whether or not the job is worthwhile for you.
$48000 a year is $23.08 per hour
Breakdown Of How Much Is 48k A Year Hourly
Let’s breakdown, how that 48000 salary to hourly number is calculated.
For our calculations to figure out how much is 48K salary hourly, we used the average five working days of 40 hours a week.
Typically, the average workweek is 40 hours and you can work 52 weeks a year. Take 40 hours times 52 weeks and that equals 2,080 working hours. Then, divide the yearly salary of $48000 by 2,080 working hours and the result is $23.08 per hour.
48000 salary / 2080 hours = $23.08 per hour
Just above $23 an hour.
Key Points….
That number is the gross hourly income before taxes, insurance, 401K, or anything else is taken out. Net income is how much you deposit into your bank account.
You must check with your employer on how they plan to pay you. For those on salary, typically companies pay on a monthly, semi-monthly, biweekly, or weekly basis.
What If I Increased My Salary?
Just an interesting note… if you were to increase your annual salary by $6K to 54000 a year, it would increase your hourly wage close to $26 an hour – a difference of $2.88 per hour.
To break it down – 54000 salary / 2080 hours = $25.96 per hour
That difference will help you fund your savings account; just remember every dollar adds up.
How Much is $48K salary Per Month?
On average, the monthly amount would be $4,000.
Annual Salary of $48000 ÷ 12 months = $4000 per month
This is how much you make a month if you get paid 48000 a year.
$48k a year is how much a week?
This is a great number to know! How much do I make each week? When I roll out of bed and do my job of $48k salary a year, how much can I expect to make at the end of the week for my effort?
Once again, the assumption is 40 hours worked.
Annual Salary of$48000/52 weeks = $923 per week.
$48000 a year is how much biweekly?
For this calculation, take the average weekly pay of $923 and double it.
This depends on how many hours you work in a day. For this example, we are going to use an eight-hour workday.
8 hours x 52 weeks = 260 working days
Annual Salary of$48000 / 260 working days = $184 per day
If you work a 10 hour day on 208 days throughout the year, you make $230 per day.
$48000 Salary is…
$48000 – Full Time
Total Income
Yearly Salary (52 weeks)
$48,000
Monthly Wage
$4,000
Weekly Pay (40 Hours)
$923
Bi-Weekly Pay (80 Hours)
$1,846
Daily Wage (8 Hours)
$184
Daily Wage (10 Hours)
$230
Hourly Wage
$23.08
Net Estimated Monthly Income
$3,054
Net Estimated Hourly Income
$17.62
**These are assumptions based on simple scenarios.
48k a year is how much an hour after taxes
Income taxes is one of the biggest culprits of reducing your take-home pay as well as FICA and Social Security. This is a true fact across the board with an all salary range up to $142,800.
When you make below the average household income, the amount of taxes taken out hurts your hourly wage.
Every single tax situation is different.
On the basic level, let’s assume a 12% federal tax rate and a 4% state rate. Plus a percentage is taken out for Social Security and Medicare (FICA) of 7.65%.
So, how much an hour is 48000 a year after taxes?
Gross Annual Salary: $48,000
Federal Taxes of 12%: $5,760
State Taxes of 4%: $1,920
Social Security and Medicare of 7.65%: $3,672
$48k Per Year After Taxes is $36,648
This would be your net annual salary after taxes.
Hourly Wage after Taxes
To turn that back into an hourly wage, the assumption is working 2,080 hours.
$36648 ÷ 2,080 hours = $17.62 per hour
After estimated taxes and FICA, you are netting $36,648 per year, which is $11,352 per year less than what you expect.
***This is a very high-level example and can vary greatly depending on your personal situation and potential deductions. Therefore, here is a great tool to help you figure out how much your net paycheck would be.***
Taxes Based On Your State
In addition, if you live in a heavily taxed state like California or New York, then you have to pay way more money than somebody that lives in a no tax state like Texas or Florida. This is the debate of HCOL vs LCOL.
Thus, your yearly gross $48000 income can range from $32808 to $38568 depending on your state income taxes.
That is why it is important to realize the impact income taxes can have on your take home pay. It is one of those things that you should acknowledge and obviously you need to pay taxes. But, it can also put a huge dent in your ability to live the lifestyle you want on a $48,000 income.
How Much Is 48K A Year Hourly Salary Calculator
More than likely, your salary is not a flat 48k, here is a tool to convert salary to hourly calculator.
In fact, many people will agree a business degree is worth it to make more than this.
48k salary lifestyle
Every person reading this post has a different upbringing and a different belief system about money. Therefore, what would be a lavish lifestyle to one person, maybe a frugal lifestyle to another person. And there’s no wrong or right, it is what works best for you.
One of the biggest factors to consider is your cost of living.
In another post, we detailed the differences between living in an HCOL vs LCOL vs MCOL area. When you live in big cities, trying to maintain your lifestyle of $48,000 a year is going to be much more difficult because your basic expenses, housing, transportation, food, and clothing are going to be much more expensive than you would find in a lower cost area.
To stretch your dollar further in the high cost of living area, you would have to probably live cheap and prioritize where you want to spend money and where you do not. Whereas, if you live in a low cost living area, you can live a much more lavish lifestyle because the cost of living is less. Thus, you have more fun spending left in your account each month.
As we noted earlier in the post, $48,000 a year is below the average income that you would find in the United States. Thus, you have to be wise with how you spend your money.
What a $48,000 lifestyle will buy you:
If you are debt free and utilize smart money management skills, then you are able to enjoy the lifestyle you want.
Have some fun money in your budget.
You are able to rent in a decent neighborhood in LCOL and maybe a MCOL city.
You should be able to meet your expenses each and every month.
Participate in the 200 envelope challenge.
Ability to make sure that saving money is a priority, and very possibly save $3000 in 52 weeks.
When A $48,000 Salary Will Hold you Back:
However, if you are riddled with debt or unable to break the paycheck to paycheck cycle, then living off of 48k a year is going to be pretty darn difficult.
There are two factors that will keep holding you back:
You must pay off debt and cut all fun spending and extra expenses.
Break the paycheck to paycheck cycle.
It is possible to get ahead with money!
It just comes with proper money management skills and a desire to have less stress around money. That is a winning combination regardless of your income level.
$48K a year Budget – Example
As always, here at Money Bliss, we focus on covering our basic expenses plus saving and giving first, and then our goal is to eliminate debt. The rest of the money leftover is left for fun spending.
If you want to know how to manage 48k salary the best, then this is a prime example for you to compare your spending.
You can compare your budget to the ideal household budget percentages.
recommended budget percentages based on $48000 a year salary:
Category
Ideal Percentages
Sample Monthly Budget
Giving
10%
$200
Savings
15-25%
$720
Housing
20-30%
$1120
Utilities
4-7%
$160
Groceries
5-12%
$320
Clothing
1-4%
$24
Transportation
4-10%
$160
Medical
5-12%
$200
Life Insurance
1%
$12
Education
1-4%
$12
Personal
2-7%
$36
Recreation / Entertainment
3-8%
$90
Debts
0% – Goal
$0
Government Tax (including Income Tatumx, Social Security & Medicare)
15-25%
$946
Total Gross Monthly Income
$4000
**In this budget, prioritization was given to basic expenses and no debt.
Is $48,000 a year a Good Salary?
As we stated earlier if you are able to make $48,000 a year, that is a decent salary. You are making more money than the minimum wage and close to double in many cities.
While 48000 is a good salary starting out in your working years. It is a salary that you want to increase before your expenses go up or the people you provide for increase.
However, too many times people get stuck in the lifestyle trap of trying to keep up with the Joneses, and their lifestyle desires get out of hand compared to their salary. It is okay to be driving around a beater car while you work on increasing your salary.
This $48k salary would be considered a lower middle class salary. This salary is something that you can live on if you are wise with money.
Check: Are you in the middle class?
In fact, this income level in the United States has enough buying power to put you in the top 95 percentile globally for per person income (source).
The question you need to ask yourself with your 48k salary is:
Am I maxed at the top of my career?
Is there more income potential?
What obstacles do I face if I want to try to increase my income?
In the future years and with possible inflation, in many modest cities 48k a year will not be a good salary because the cost of living is so high, whereas these are some of the cities where you can make a comfortable living at 48,000 per year.
If you are looking for a career change, you want to find jobs paying at least $60000 a year.
Is 48k a good salary for a Single Person?
Simply put, yes.
You can stretch your salary much further because you are only worried about your own expenses. A single person will spend much less than if you need to provide for someone else.
Learn exactly what is a good salary for a single person today.
Your living expenses and ideal budget are much less. Thus, you can live extremely comfortably on $48000 per year.
And… most of us probably regret how much money wasted when we were single. Oh well, lesson learned.
Is 48k a good salary for a family?
Many of the same principles apply above on whether $48000 is a good salary. The main difference with a family, you have more people to provide for than when you are single or have just one other person in your household.
The costs of raising children are high and will steeply cut into your income. As you can tell this is a huge dent in your income, specifically $12,980 annually per child.
That means that amount of money is coming out of the income that you earned.
So, the question really remains can you provide a good life for your family making $48,000 a year? This is the hardest part because each family has different choices, priorities, and values.
More or less, it comes down to two things:
The location where you live in.
Your lifestyle choices.
You can live comfortably as a family on this salary, but you will not be able to afford everything.
Many times when raising a family, it is helpful to have a dual-income household. That way you are able to provide the necessary expenses if both parties were making 48000 per year, then the combined income for the household would be $96,000. Thus making your combined salary a very good income.
Learn how much money a family of 4 needs in each state.
Can you Live on $48000 Per Year?
As we outlined earlier in the post, $48,000 a year:
$23.08 Per Hour
$184-230 Per Day (depending on length of day worked)
$923 Per Week
$1846 Per Biweekly
$4000 Per Month
Next up is making between $50000 a year and $55000 a year.
Like anything else in life, you get to decide how to spend, save and give your money.
That is the difference for each person on whether or not you can live a middle-class lifestyle depends on many potential factors. If you live in California or New Jersey you are gonna have a tougher time than in Oklahoma or even Texas.
In addition, if you are early in your career, starting out around 38,000 a year, that is a great place to be getting your career. However, if you have been in your career for over 20 years and still making $48k, then you probably need to look at asking for pay increases, pick up a second job, or find a different career path.
Regardless of the wage that you make, if you are not able to live the lifestyle that you want, then you have to find ways to make it work for you. Everybody has choices to make.
But one of the things that can help you the most is to create a biweekly budget to make sure you stay on track.
Learn exactly how much do I make per year…
One of the best ways to improve your personal finance situation is to increase your income. Here are a variety of side hustles that are very lucrative. With time and effort, you can start enjoying the lifestyle you want.
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photo: quaziephoto
Everyone knows the story. Unemployment is up. FICO scores are down. Home values are down. And because home values are down, home equity has disappeared for millions of homeowners. And since home equity was the financial safety net millions of consumers used to pay off their credit card debt, well, you know the rest. Let’s just agree that, right now, millions of consumers have no way to pay off all of their credit card debt.
There are a variety of ways to get out of credit card debt, right? You can budget your way out of debt. You can file bankruptcy. You can enroll in a debt management plan (DMP) through one of the member organizations of the National Foundation for Credit Counseling, commonly referred to as Consumer Credit Counseling Service (CCCS). You can work with your credit card issuer directly and seek help through one of their hardship programs. You can attempt to settle the debt on your own. Or you can enlist the services of a debt settlement company.
Opinions vary on these options. They all have their pros and cons. The purpose of my article isn’t to explore each option. I’ll do that soon.
The purpose of this article is to explore debt settlement as an option.
Settlement is quite an easy concept to understand. You agree to pay your credit card issuer an amount of money less than what you really own them and they consider the debt to be paid in full. So, if you owe John Ulzheimer’s Bank $10,000 and I agree to accept $5,000 as “full payment” then you have settled your debt with John Ulzheimer’s Bank. The bank reports the settlement to the credit reporting agencies and sends you a 1099 for the forgiven amount. Settlement, incidentally, is considered one of FICO’s Seven Deadly Sins.
Settlement can be accomplished by working directly with your bank. You do not have to hire someone to do this for you. That’s a myth. In fact, many credit card issuers won’t even work with debt settlement companies so you have no choice but to deal with them directly. This is okay because all creditors have their version of a “Remediation” department, which is where you’ll likely end up if you call them asking for a settlement deal.
Now, let’s move on to the debt settlement companies. You’ve all seen their commercials. Distraught couples staring at their credit card statements magically turning into happy families playing with puppies in their front yard, all thanks to ye ole friendly debt settlement company. Heck, there’s even a version that has excerpts from one of President Obama’s speeches and a picture of a government building in the background. It’s clearly intended to come across as a governmental program. Of course, it’s not a government program.
Here’s how they work. First they find out how much debt you have. This is to determine if you’re even worth doing business with. If you have too little debt then they won’t make enough money working with you. That’s why their ads contain statements like “If you have more than $10,000 in credit card debt call now…” If you have enough debt, in their eyes, then they’ll sign you up.
When you sign up they’ll tell you to stop communicating with your credit card issuers. I’m not kidding, they really tell you this. That means no more payments and no more return calls. The hypothesis here is to get your credit card issuer so desperate for payment that they’ll accept a settlement offer.
At the same time you’ll be asked to make monthly payments to the settlement company. Why? Because you’re creating a war chest that serves two purposes. First, this is where their fees will come from. Second, this is where the settlement offer will come from.
After several months, or longer, there will be enough money for them to make some sort of offer to the credit card issuer. The issuer may accept the offer, or they may decline the offer. Either way, your fees to the settlement company have been paid.
So what happens during the period of time you’re paying the debt settlement company (and ignoring your creditors)? Well, since that’s not a part of the commercials I’ll have to be the one who breaks the bad news.
1.Your credit will be trashed.
The credit card issuer will report the ascending level of late payments to the credit bureaus, which remain on your credit file for seven years. Now the debt settlement guys will say “well, your credit is probably already trashed so no big deal.” Wrong, new (and numerous) late payments help to lock in lower scores for additional time. And it gets worse…
2. The card issuer will likely enlist the services of a 3rd party collection agency to collect the debt.
This means a brand new collection will be reported to your credit files. Again, this remains for seven years. And, these guys can pull your credit reports to find you and determine your ability to pay them. That means you’ll have to explain collection inquiries. You’re supposed to ignore these guys as well. And it gets worse…
3. That knock at your door…yeah, that guy is called a process server.
Your credit card company or a collection attorney has sued you for nonpayment of the debt. You can’t ignore him like you’ve been ignoring your credit card issuer. If you do choose to ignore the summons you’ll lose by default for not showing up to court. This is called a default judgment. And yes, the judgment can show up on your credit report for seven years. And it gets worse…
4. Become familiar with the term “Writ of Sequestration.”
In English this is either legal garnishment of your wages or seizure of your assets. If your wages are garnished your employer will now be made aware of your defaulted debt problems because they’re the ones who will hold back a portion of your salary.
You’ve totally lost control of the situation because you chose to ignore your creditors, at the request of a company trying to profit off of your debt situation. Smart? Or not?
And, just to tie a nice bow on the top of this one, the Attorneys General in the states of Florida and Alabama have shut down major debt settlement networks because, and I quote, “they’re a scam because consumers get no value for their fees.” I’ll write soon about the DSCPA (Debt Settlement Consumer Protection Act), which will put most of these guys out of business.
John Ulzheimer is the President of Consumer Education at SmartCredit.com, the credit blogger for Mint.com, and the author of the “credit history” definition on Wikipedia. He is an expert on credit reporting, credit scoring and identity theft. Formerly of FICO, Equifax and Credit.com, John is the only recognized credit expert who actually comes from the credit industry. He has served as a credit expert witness in more than 70 cases and has been qualified to testify in both Federal and State court on the topic of consumer credit.
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Inside: Do you need to make $5000 fast for ways to make extra money? This guide has dozens of ideas for earning money. When you need to know how to make 5000 fast, this list has something for you.
Are you looking for ways to make 5000 dollars fast?
You’re in the right place.
In this post, we’ll share 15 realistic ways to make money quickly.
Your first thought might be SCAM to make this much money fast, but honestly, there are plenty of ways to make extra cash without any special skills or experience.
You just have to decide what works best for you. That is how you will make the most money without feeling like you are working.
I love hustling to make extra money to afford things we couldn’t otherwise.
So if you’re ready to start making some extra cash, let’s get started!
What are the most realistic ways to make $5,000 fast?
Moreover, making $5,000 fast is possible through a combination of online and offline methods.
Selling items, offering freelance work, participating in paid surveys, trading stocks, and pet-sitting or dog-walking services are all viable options.
Set goals, track progress, and experiment with multiple gigs to find what works best for you. With dedication, effort, and a little bit of creativity, you can reach your income goal in no time.
How to double $5,000 quickly?
If you want to double $5,000 quickly, there are several realistic ways to achieve this goal. Here are five options to consider:
Invest in the stock market: The stock market can be a great way to make money quickly, but it also comes with risks. Look for companies with a strong track record and invest wisely.
Start a side hustle: Starting a side business or selling items online can be a great way to make extra money. Consider your skills and interests to find a profitable niche.
Participate in affiliate marketing: Affiliate marketing involves promoting products and earning a commission for each sale. Look for products with high commissions and a strong customer base.
Flip items for profit: Buy low and sell high by flipping items like cars, furniture, or electronics. This can be a risky business, so do your research and start small.
Play the long game: Consider living a frugal life and saving and investing your money over time to see a larger return. This may not double your money quickly, but it can lead to significant growth in the long run.
Each method comes with its own potential risks and benefits, so it’s important to do your research and choose the option that best fits your skills and financial goals.
With dedication and hard work, doubling your $5,000 is within reach.
This post may contain affiliate links, which helps us to continue providing relevant content and we receive a small commission at no cost to you. As an Amazon Associate, I earn from qualifying purchases. Please read the full disclosure here.
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16 realistic ways to make 5000 dollars fast
If you’ve been looking for ways to make some extra money, there are many opportunities out there.
While most won’t make you rich overnight, if you put in the effort, you can find some that will help you reach your financial goals.
Here are 16 realistic ways to make $5,000 fast.
1. Sell Unwanted Items
If you’re looking to make $5000 fast, selling unwanted items is a great way to do it.
Start by identifying valuable items in your home such as antiques, electronics, furniture, or musical instruments.
Once you’ve identified your items, choose a platform to sell on eBay, Craigslist, and Facebook Marketplace are all great options.
When pricing your items, do some research to ensure you’re pricing them competitively. Use the “buy it now” feature on eBay or set a fair price on Craigslist and Facebook Marketplace. Don’t forget to take clear photos and provide detailed descriptions of your items.
Check out the most popular items to sell and make money. Plus you can declutter your home.
2. Take on a Part-Time Job
Part-time jobs offer a steady stream of income and opportunities for skill development. Often this is an overlooked way to make money, but there are plenty of part-time jobs available.
Popular part-time job options include retail or food service positions, which often offer the potential for tips or commission-based earnings.
Balancing a part-time job with other commitments may be challenging, but it can be done with proper planning and prioritization. Overall, a part-time job can be a reliable way to generate extra income and reach financial goals.
Many happen to be early morning jobs, too.
3. Invest in Stocks
Investing in stocks can be a realistic way to make $5000 fast. In fact, learn how fast you can make money with stocks.
Since you are interested in making money fast, you need to be an active trader, which means you are trading for income. Not a buy-and-hold investor.
Typically, most active traders prefer to trade growth stocks such as Google, Microsoft, Amazon, Apple, or Tesla.
It’s important to do your research and choose the right stocks to invest in. More importantly, you have to know when to enter and exit. Here is the best course I know on learning how to trade stocks.
However, keep in mind that investing in stocks is subject to market risk, so it’s important to consult with a personal finance expert and assess your risk tolerance before making any investments.
4. Borrow Money
Remember that borrowing money should not be a long-term solution and explore other ways to make money as well.
If you need to make $5000 fast, borrowing money might be an option. You can borrow from a personal loan, credit card, or friends and family.
Personal loans are a good option if you have good credit, but they often come with high-interest rates.
Credit cards can offer cash advances, but the interest rates can be high too.
Borrowing from friends or family can be a good option, but it can also put a strain on relationships.
To secure the best possible terms, shop around for loans and compare interest rates and fees. Make sure to read and understand the terms and conditions before signing, and ensure you can make the payments on time.
5. Sell Things Online
Selling things online is a great way to make extra cash quickly. This involves buying items you know you can resell online for a higher price.
With the ability to reach a wider audience and the convenience of not having to leave your house, selling online has become increasingly popular.
Platforms like eBay, Etsy, and Amazon offer product-selling concepts that make it easy to sell a variety of items, from clothes to electronics.
To optimize product listings, take high-quality photos, write detailed descriptions, and price items competitively. When handling shipping and handling, use free shipping labels, and provide excellent customer service to ensure a positive experience for buyers.
6. Land a Job That You Can Do From Home
To land a job that you can do from home, it’s important to have the necessary skills and qualifications for the job you’re interested in.
Popular work-from-home jobs include online tutoring, virtual assistance, bookkeeping, social media management, and transcription.
Be prepared to participate in virtual interviews and demonstrate your ability to work independently. With the right skills and job search strategies, you can land a job that you can do from home.
Find the best non phone work from home jobs.
7. Make Crafts
Crafts can be a fun way to turn your hobby into a money-making side hustle.
Here’s a step-by-step guide to help you get started:
Choose your craft: Decide on a craft that you enjoy making and that you think will sell well. Popular options include jewelry, candles, and home decor.
Gather your materials: Depending on your craft, you’ll need to gather materials such as beads, wax, or fabric. You can find these at craft stores or online.
Develop your skills: If you’re new to your chosen craft, take some time to practice and improve your skills. Watch tutorials and read books to learn new techniques.
Create your products: Once you have your materials and skills, start creating your products. Make sure they’re high-quality and visually appealing.
Set up shop: You can sell your crafts online through platforms like Etsy or Amazon Handmade. You can also sell them in person at craft fairs or local markets.
Promote your products: Use social media and word of mouth to promote your products. Share photos and information about your crafts and encourage people to buy them.
By following these steps, you can turn your love of crafting into a profitable side hustle. Remember to be patient and persistent in your efforts to sell your crafts.
8. Rent Out a Space
Right now, your space can be a profitable side hustle.
To make $5000 fast by renting out a space, start by identifying the type of space you can rent out, such as a parking room, garage, or storage space.
You can even get creative and rent out your pool.
Clean and organize the space, then list it on online platforms like Airbnb, Turo, or Neighbor. To ensure a smooth rental process, screen potential renters, set clear rules and expectations, and maintain regular communication.
With some effort and attention to detail, renting out a space can provide a lucrative source of extra income.
9. Sell Digital Goods
This is one of the most popular ways to make money.
Digital goods are products that can be downloaded, streamed, or accessed online, such as ebooks, printables, stock photos, and online courses.
They are a viable option for making money quickly because they require little to no overhead costs and can be sold to a global audience.
The most popular is creating and selling printables. Learn how to make printables.
With dedication and effort, selling digital goods can be a lucrative way to make up to $5000 fast.
10. Join the Gig Economy
The gig economy refers to a labor market characterized by short-term contracts or freelance work, as opposed to permanent jobs.
Popular platforms in the gig economy include:
Joining the gig economy can be an effective way to make $5,000 quickly. One of the main benefits of working in the gig economy is flexibility, as you can determine your own schedules.
To maximize earnings, it’s important to treat gig work like a business and stay organized, tracking expenses and income.
11. Work as a Shopper
As a shopper, your job is to pick up and deliver items to customers using your own vehicle.
Here’s a step-by-step guide on how to get started:
Choose a platform: There are several platforms to choose from, such as Instacart, Shipt, and DoorDash. Research each platform and choose the one that best suits your needs.
Sign up: Once you’ve chosen a platform, sign up and complete the application process. This typically involves providing personal information, a valid driver’s license, and passing a background check.
Attend orientation: Some platforms require you to attend an orientation session before you can start working. This will provide you with important information on how to use the app, how to pick up and deliver items, and how to maximize your earnings.
Start shopping: Once you’re approved, log into the app and start accepting orders. Be sure to read the instructions carefully and communicate with the customer if you have any questions.
Maximize earnings: To maximize your earnings, consider working during peak hours when there are more orders available. You can also increase your tips by providing excellent customer service and communicating with customers throughout the shopping process. Additionally, some platforms offer bonuses for completing a certain number of orders within a specified time frame.
Ensure success: To ensure success, it’s important to be organized and efficient. Plan your route ahead of time and try to group orders in the same area together. Keep track of your expenses, such as gas and vehicle maintenance, and make sure you’re earning enough to cover these costs.
With the convenience of on-demand shopping and delivery services, there’s never been a better time to get started.
12. Clean Houses
Cleaning houses can be a lucrative business, with the demand for house cleaning services always high.
To get started, you will need basic cleaning supplies such as cleaning products, mops, vacuums, and cleaning cloths. You can market your services by creating flyers, promoting on social media, and offering referral discounts.
Here are some tips to be successful:
Setting your rates depends on factors such as the size of the house and the frequency of cleaning.
Negotiating with clients can help you secure long-term contracts.
Providing excellent customer service is crucial for building a loyal client base.
As your business grows, consider expanding your services to include laundry and organizing, and hiring additional staff to take on more clients.
With dedication and hard work, you can make up to $5000 fast by cleaning houses.
13. Take Photos
If you’re looking for a side hustle that can earn you some extra cash, taking photos on your phone and selling them on stock photo sites is a great option. You don’t need to be a professional photographer, but having some experience can be helpful.
Some of the best apps to sell your photos on include Shutterstock, Deposit Photos, or iStock by Getty Images.
To get started, you’ll need to create a portfolio of your best work and start submitting them to stock photo sites. While you might need to purchase a camera and photo editing software, there’s not much else you need to get started.
It’s possible to make $1 or more per photo you sell.
14. Write Web Content for a Blog
Well-written web content is essential for making money online, as it can attract more visitors to your blog and keep them engaged.
To write effective web content, it’s important to understand your audience and their needs and to use clear and concise language.
Make sure to use headings, bullet points, and images to break up text and make it easier to read. Additionally, provide actionable advice that can help readers make money or solve a problem.
Sharing your personal experiences and stories can also help to connect with your audience and build trust. By following these tips, you can create high-quality web content that can help you make money and increase website traffic.
15. Engage in Affiliate Marketing
Affiliate marketing is promoting someone else’s product or service and receiving a commission for every sale you facilitate.
To be successful with affiliate marketing, start by finding products with high commissions and you will need a large number of followers.
Build an audience around the products you’re promoting and promote them through social media and email marketing. Focus on building a strong relationship with your audience and providing value through helpful content.
With the right strategy and persistence, you can earn your first $5000 through affiliate marketing in no time.
16. Provide Virtual Assistant Services
Virtual assistant jobs are becoming increasingly popular as a way to make money from the comfort of your own home.
As a virtual assistant, you can perform a variety of tasks such as scheduling appointments, managing social media accounts, answering emails, creating presentations, and more. The amount of money you can make will vary depending on your skills, but the average hourly rate for a virtual assistant is around $25 per hour.
Additionally, taking virtual assistant courses and learning new skills can help you specialize and earn more money.
How to use what you’ve learned to start making money quickly
Believe me, I have gone down the road of making money with MLMs or (multi-level-marketing). However, I have found the above ways to be better options for me.
Once you find your groove, you will be able to scale up how much money you make.
Step 1: Research ways to make money fast
If you need to make money quickly, there are many legitimate opportunities available.
Try multiple gigs to find what pays the most in your area and what you enjoy doing.
When researching ways to make money fast, be cautious of scams and do your due diligence before committing to anything. With a bit of creativity and determination, you can find practical and actionable steps to achieve your financial goals.
Step 2: Choose a way to make money fast
When choosing the best way to make $5000 fast, there are a few criteria to consider.
First, consider your skills and interests. If you enjoy driving, delivering for DoorDash or UberEats could be a good fit. If you’re tech-savvy, freelance work or online tutoring might be a good option.
Second, consider the time commitment. Some methods, like selling items on eBay or Facebook Marketplace, can be done in your spare time, while others, like starting a side hustle or taking on freelance work, may require more time and effort.
Finally, consider the potential earnings. Some methods, day trading stocks or selling printables, have the potential for higher earnings than others.
Step 3: Get started making money fast
If you’re looking to make money fast, it’s important to take action right away and not get bogged down by analysis paralysis.
Start with the methods that require the least amount of time and effort, such as selling items you no longer need or completing online surveys. These are easy-to-implement money-making strategies that can quickly generate extra cash.
If you need to save up for a course, then set aside your profits to make that happen.
Step 4: Sacrifice your time for money
Sacrificing your time can be a great way to make money quickly.
The best is when you start to build passive income, you are earning money without the need to work. That is when your hard work will pay off.
By dedicating your time to side hustles, you can earn a significant amount of money within a short period.
Step 5: Maximize your revenue with each step
To make $5000 fast, it’s essential to set realistic revenue goals and identify the most profitable revenue streams.
Prioritize the revenue streams that are most feasible and have the highest earning potential. Once you have identified your revenue streams, optimize your earnings by leveraging your skills and resources.
This could include networking, outsourcing, or investing in your own education to improve your earning potential.
FAQ
Flipping items on eBay is a great way to make money.
To start, you need to find items that you can buy for a low price and sell for a higher price. Look for items that are in demand, such as electronics, clothing, and collectibles. You can find these items at flea markets, garage sales, and online marketplaces like Craigslist and Facebook Marketplace.
Remember to reinvest your profits into buying more items to flip. With time and effort, flipping items on eBay can be a lucrative side hustle.
Becoming a content creator on YouTube might be an option for you.
You can make money from ads, affiliates, and sponsored content, as well as selling your own merch and products.
It is important to create consistent and top-quality videos to build up a following, but it can be a lucrative online side hustle.
freelance work, and more. Here are some of the most popular options:
Freelance work: Graphic design, web development, digital marketing, typing, and more.
Food delivery: DoorDash, Instacart, Uber Eats, Grubhub, and more.
Package delivery: Amazon Flex, Roadie, GoShare, Lugg, and more.
Rideshare driving: Lyft, Uber, and more.
While these jobs offer flexibility and quick payment, they may come with fees and additional costs. Nevertheless, they are great options for making extra income on the side.
There are plenty of job opportunities in the gig economy, ranging from food delivery to How to make $5,000 in a month?
There are several realistic and actionable ways to make $5,000 in a month.
Freelance jobs like virtual assistance, freelance writing, and web development are great options. If you have an established following, your YouTube channel could also make more than $5,000. Other methods to explore are selling on Amazon, affiliate marketing, and blogging.
While some methods may require more work than others, there’s no reason you can’t earn this money quickly.
Remember to think outside the box and explore all of your options.
How to Get 5000 Dollars Fast
Remember that making money fast requires dedication and persistence, but the rewards can be significant.
The potential earnings and time commitment for each option vary, but with effort and dedication, you can make $5000 within a couple of months.
Selling items can earn you a few hundred to a few thousand dollars, while freelance work and trading stocks can earn you thousands of dollars depending on the quality of your work.
Don’t be afraid to try new things and experiment with different methods until you find what works best for you.
Also, consider what works well for one person may not be the best idea for the next.
Maybe earning 5k is more than you need:
Know someone else that needs this, too? Then, please share!!
Welcome to NerdWallet’s Smart Money podcast, where we answer your real-world money questions.
This week’s episode starts with a round of Money Hot Takes.
Then we pivot to this week’s money question from Sean:
“Hey folks,
Huge fan of the podcast. I have been listening for years, but this is, I think, the first time I’m submitting a question and it’s a complicated one.
I currently work as an engineer for a municipal utility. As an engineer, I have some ability for job mobility. While I do like my job, I have thought about what it would take to draw me away from my job, and I have had trouble figuring out what a ‘godfather offer’ would need to be.
As a civil servant, I have great healthcare, a pension, job security and overtime if I work beyond my scheduled 40-hour workweek. In the private sector, I have more income potential, but I would lose a lot of these benefits and end up working a lot more hours. I’ve had some trouble figuring out how to evaluate some of these benefits, particularly the pension.
Thank you,
Check out this episode on either of these platforms:
Episode transcript
Sean Pyles: Hey, Liz, if you had a job that offered you a pension, would you still leave just because you were bored?
Liz Weston: Well, pensions are sweet, but I do like being challenged, so maybe.
Sean Pyles: All right, I’m going to say I wanted a yes or no answer, but I think that that’s OK. I just hope that you would at least stick around until you’re fully vested.
Liz Weston: Well, of course.
Sean Pyles: Yes. But in this episode, we answer a listener’s question who’s considering bailing on a pension.
Welcome to the NerdWallet Smart Money podcast, where you send us your money questions and we answer them with the help of our genius Nerds. I’m Sean Pyles.
Liz Weston: And I’m Liz Weston. Listeners, remember to send us your money questions. Maybe you’re wondering if now is a good time to buy up a bunch of gold or you’re wondering how far in advance you should book an international vacation. Whatever your questions, send it our way. Leave us a voicemail or text us on the Nerd hotline at 901-730-6373; that’s 901-730-N-E-R-D. You can also email us at [email protected]
Sean Pyles: In this episode, our co-host Sara Rathner and I answer a listener’s question about how to leave a job. But first, Liz and I are going to get mad because it’s time for another round of Money Hot Takes. This is our occasional segment where we rail against something that we just don’t like in the personal finance space. The goal is for us personally to blow off a little bit of steam and hopefully help our listeners make smarter decisions in a world full of scammers, fraudsters and phonies or sometimes just plain old misconceptions that can cost you money.
Liz Weston: Oh, I love this. This is going to be fun. OK, Sean, what do you have for us?
Sean Pyles: Today, I’m calling out the online, quote, unquote, “courses” that some influencers peddle to their followers. A lot of these classes aren’t providing you any information that you can’t get on your own for free, and the folks teaching them are often, shall we say, not exactly qualified. And a shoutout to Rebecca Jennings from Vox who wrote an article that so well articulates my feelings and concerns around these courses. We’ll have a link to that article in the show notes.
Liz Weston: So what’s in these courses, Sean?
Sean Pyles: Kind of everything that you can imagine you might want to improve upon. There are classes in things like how to use Excel. There are classes in how to get started investing or budgeting. There are even classes on how to make your own class to sell to people, which is a little meta.
Liz Weston: Of course, of course.
Sean Pyles: And the prices vary greatly. Some are under a hundred dollars; others are over a thousand dollars, maybe $2,000.
Liz Weston: Ooh, well, I think I know the answer to this question, but tell us why you don’t like them.
Sean Pyles: Well, as I mentioned at the outset, a lot of people are paying for information that they can get elsewhere for free. And again, many of these people have very questionable credentials. Sometimes the people who are teaching these classes are not actually experienced or qualified in what they’re telling you to do. And in fact, they’re just really good at marketing themselves, which I always have an issue with. People who seem just overly into marketing their own personality for the sake of getting money and attention on the internet.
Liz Weston: Yeah. And I imagine that could cause people not to go to good sources to get their information or leave them with a patchwork of incomplete information.
Sean Pyles: Exactly. They think that they’re getting everything they need to know about how to get started investing from one online class when in fact it might just be a small piece of the picture. Also, they can seem a little scammy to me. This is especially the case with classes around investing. Some will teach you how to invest and then maybe try to get you set up with investing during the class, and they’ll get you set up through a platform that also pays the influencer and affiliate commission, which seems like quite the conflict of interest there. And also, never mind the platform the influencer is peddling might not be the right one for you. So this person is getting money from you signing up for their class, and they’re also getting money from the company that they’re pushing on you as well, which I just don’t like.
Liz Weston: Now, I will say I like online courses in some cases because they help me get up to date or catch up on something I should have learned earlier, like Excel. The Excel courses were very helpful, but they’re not all bad. So how do you determine which are the better ones?
Sean Pyles: I’m with you, Liz. I am not an absolutist. In pretty much anything, there are plenty of great online classes. I’m a huge fan of Masterclass, for example. Not paid to say that; I just use their stuff a lot, but they are very well vetted. I think it’s important to vet your sources and to be selective about the type of information that you’re getting. Maybe a language course from someone who lives abroad and has learned a different language is something that you can more easily get into versus a class that’s about the secret to getting rich. Also, maybe don’t have this online course be the only source of information on the subject.
Liz Weston: Yes, maybe you could even come to a site, I don’t know, NerdWallet.
Sean Pyles: Yeah, we are a great alternative. And you know what? I think some folks might be thinking, “Hey, how is NerdWallet different from these online personal finance influencers or courses?” And to that, I have two words to say: journalistic rigor. Our content is deeply reported, edited, fact-checked, not to mention editorially independent, to ensure that the information that we’re giving is as accurate and consumer-first as possible.
Liz Weston: And if you need more personalized help with your money, there are plenty of professionals who can help you. Financial coaches can help you get a grip on your budget and financial goals. Accredited financial counselors can offer tools to wrangle your debt, and fee-only fiduciary financial planners are a solid choice if you need guidance on building your wealth.
Sean Pyles: Very well said, Liz. So that is my rant, and Liz, now you’re up.
Liz Weston: OK. This is really nerdy, Sean, but I am annoyed that people don’t understand how life expectancy works.
Sean Pyles: OK, you’re right. That is really nerdy. I’m going to need you to elaborate on what that even means and why it’s making you so mad.
Liz Weston: OK. This is important because understanding life expectancy is key to so many things about retirement planning, which is basically how long your retirement will last, right? So you need to know roughly your life expectancy so you can figure out when to take Social Security, and it probably can help you better understand all the debates about raising the retirement age. Remember when I was in Paris and they were setting fire to the garbage over there?
Sean Pyles: Yes.
Liz Weston: Yeah, that’s this debate. So I just read a New York Times article about the best age to retire, and it used the wrong number. It said the average life expectancy was 76 years.
Sean Pyles: OK, so you’re out here dragging the Gray Lady for being wrong, is that right?
Liz Weston: Sorry, hats off to The New York Times, lots of great reporting, but that’s the average U.S. life expectancy from birth. That factors in infant mortality and all the people who die young or young-ish from accidents or disease or whatever. That number is 76, by the way, because largely of all the COVID deaths, which is the reason that life expectancy has dropped a bit. But that number is pretty much irrelevant for retirement planning because the longer you survive, the longer you’re likely to survive. What matters is how much life you’re likely to have left when you get to retirement age. And at 62, which is the earliest age you can claim Social Security, the average man can expect to live until almost 81 and the average woman till 84. If you make it to 65, both men and women are likely to make it to their mid-80s. Now, your mileage may vary. Obviously, lifestyle, genetics, other factors come into play. Unfortunately, Black people tend to have shorter life expectancies. But the more income and education you have, the more years you can probably add to your life expectancy.
Sean Pyles: And I imagine this really matters when it comes to claiming Social Security.
Liz Weston: Oh, it’s so true. If you file early at 62, you are settling for a permanently reduced check. You’re giving up a lot of money because you’re likely to live well past the age when the larger checks that you would’ve gotten for waiting more than make up for the smaller checks you bypassed in the meantime. We talked to Nerd Tina Orem, and her calculator can show you your break-even age. And what’s more, if you’re the higher earner in a married couple, you’ve really done your spouse a disservice if you file early. And that’s because your benefit determines what your spouse gets to live on after you’re gone. So starting early means you’ve permanently reduced the survivor check that your spouse will have to live on for the rest of their lives.
Sean Pyles: Got it. OK. And that’s especially important for men to think about because women tend to outlive men.
Liz Weston: Yeah. And if you are a same-sex couple, again, it’s the higher earner that matters. So it’s something to keep in mind. The higher earner should delay as long as possible. And also, it can really help to use a calculator to estimate your own life expectancy. And there’s a really good one at livingto100.com.
Sean Pyles: Well, I think that we both feel a little bit better getting that out of our system. I don’t know about you, Liz.
Liz Weston: Yes, thank you. I do.
Sean Pyles: Great. Now let’s get on to this episode’s money question segment with co-host Sara Rathner.
Sara Rathner: This episode’s money question comes from the excellently named Sean, who sent us an email. “Hey folks, huge fan of the podcast.” Thank you. “I’ve been listening for years, but this is, I think, the first time I’m submitting a question and it’s a complicated one. I currently work as an engineer for a municipal utility. As an engineer, I have some ability for job mobility. While I do like my job, I have thought about what it would take to draw me away from my job. And I’ve had trouble figuring out what a, quote, unquote, ‘Godfather offer’ would need to be. As a civil servant, I have great healthcare, a pension, job security, and overtime if I work beyond my scheduled 40-hour work week. In the private sector, I have more income potential but I would lose a lot of these benefits and end up working a lot more hours. I’ve had some trouble figuring out how to evaluate some of these benefits, particularly the pension. Thank you, Sean.”
To help us answer Sean’s question, on this episode we’re joined by NerdWallet data writer Liz Renter. Welcome back to Smart Money, Liz.
Liz Renter: Thanks, Sara. I’m excited to be here.
Sean Pyles: So first, I think folks should understand the total value of work benefits because it extends well beyond the cash that you get. According to March 2023 data from the Bureau of Labor Statistics, for government workers, benefits represent about 38% of compensation, compared with just under 30% for private-sector workers. As our listener knows, the benefits of government jobs are pretty cushy, and that can be really hard to give up.
Sara Rathner: That 30% to 38% figure might come as a surprise to you because I think when people are evaluating a job opportunity, there’s so much of a focus on the salary and maybe a bonus if that’s part of the deal. But if you’re thinking of leaving your current job, it is worth it to work to understand your total compensation, not just wages, but benefits as well. So listing out your benefits, like paid time off, access to resources like financial advisors or even discounted legal assistance, maybe some cold brew coffee on tap in the office kitchen.
Each of these has a specific value, but it can be pretty tedious to add it all up. Another big thing to think about are taxes. This is a bigger deal if you’re thinking of becoming a freelancer or a contract worker where you’d be on the hook for sorting out your own tax obligation. Based on what you figure out, you might decide whether or not you want to go down the freelancer or contractor route at all, or would you prefer to be a full-time employee at a company? Another big one, this is a really big one: health care.
Liz Renter: Huge.
Sara Rathner: Huge and so expensive. Definitely contact HR during the interview process, or when you have the offer and you have some time to think it over, to get the health care plan options and their pricing.
Liz Renter: Yeah. And I just want to interject, Sara, that’s a good point. If you’re talking to a potential employer or even your current employer about what the health care costs look like, how much they’re covering, keep in mind that employers get a heck of a discount on premiums. They get a group discount because they’re paying for multiple policies at once or helping to pay for multiple policies at once. So if self-employment is under consideration or a job that may not offer health insurance at all, your premiums are going to be much, much higher than what your employer would be paying in the situation where they’re helping to cover those costs.
Sara Rathner: Yes. And I have been in both boats and …
Liz Renter: Same.
Sara Rathner: … real expensive to be self-employed when it comes to health insurance coverage. And that was one of my reasons for not pursuing that for the remainder of my career if I can help it. But you know, you do you. And then also, here’s another one. There are all these extra benefits that really add up. Things like a monthly gym stipend or a cell phone stipend. A lot of remote workers get a home internet stipend as well. And the cost of these things can really offset the price of some of the things you might have been paying for out of pocket if you were previously at a job that didn’t provide this as a benefit.
Liz Renter: Right. And I think those things are far less likely in, like the listener wrote in about, a municipal job or a state government job. Unlikely you’re going to have a keg of cold brew in the kitchen unless you’re in a really affluent city and tax rates are pretty high. But you’re right, some of those things that you take for granted, the snacks and the catered lunches at private industry, really do add up. You can spend a lot of money on those yourself if you’re having to pay for them.
Sara Rathner: Yeah, you definitely see a lot of those benefits in the tech industry because they are just falling all over themselves to make these companies more attractive to job applicants than the tech company down the street. Literally down the street, depending on what city you’re in. And so if that’s an industry where you are weighing some job offers, then yeah, you’re going to see some pretty wild benefits that have a dollar value to them.
Sean Pyles: Well, that said, there is one benefit that you will maybe get at a municipality that a tech company is not really going to be offering you. And that is the pension benefit that our listener wrote in about. And I want to give a quick rundown of how pensions work because they’re pretty incredible and they’re unfortunately not very common. So pensions are typically employer funded. That means the employer is putting in money, which is great. So the amount folks get in retirement depends on wages earned and how long they worked for the company or, in this case for our listener, a municipality.
Then upon retirement, someone who has access to a pension, they get payouts, typically for life. You generally do have to work at an organization for a set amount of time to get full access to the payouts. That’s called being fully vested. But once you’re fully vested, you can leave that job and still get access to the pension benefits upon retirement. So, so cool. I really wish I had a pension. Now, like I mentioned, pensions are really rare nowadays. So again, pensions are a very sweet benefit to have, and I would think very hard about losing that, especially if you’re not fully vested.
Liz Renter: Yeah, absolutely, Sean. And the listener wrote in about putting a dollar figure on their pension. So I just want to know that that’s an extremely difficult thing to do without a lot of details, and a lot of time, and a big spreadsheet and a calculator. Anyways, when you’re thinking about how long you’ve been at a job, how much your employer’s putting in, what the specifics are about vesting and if you decide to leave that government job, to leave your pension, and what would it take to create something comparable yourself? So there’s a lot of numbers involved, a lot of time frames, a lot of assumptions. So this is one instance where we would say, “If you really want to get precise on that measurement, it might make sense to consult with a certified financial planner who can put the dollar amount on those things.”
Sean Pyles: You’d likely want to talk with a CFP who maybe has some gray in their hair and who has done this before since figuring out pensions can be so complicated.
Liz Renter: Right. Yeah, exactly.
Sara Rathner: And honestly, if you have a financial planner that you already have a working relationship with, I mean, job hunting is an excellent time to have a check-in with them in general, and they might even help you wade through competing job offers or even just the comparison of a job offer to what you’re currently working in. And they can help you work through all the financial considerations of those options. And so that is a great way to utilize their assistance.
So let’s get to the other part of a listener’s question. The mushier stuff that folks should consider if they find themselves itching to leave a job. To start, they should ask themselves, what’s behind this urge? Are they bored, unhappy, unfulfilled? Are they upset because there’s no cold brew in the break room and they really want that?
Liz Renter: Yeah, this is key, Sara. I think there’s so many considerations when you’re thinking about a career move. And I had two really major career changes in my younger years. It’s over the past 20 years, but they were really pretty close together when I was in my late 20s. One when I moved from state government to private industry, and then a few years later, I went from private industry to self-employment. So those are pretty big changes. And in each of those changes, I was weighing different motivations. In one case, it was more about the money and advancement, and in the other case, it was more about what’s really going to make me happy long term? And so I think really diving into why and what your motivations are for leaving or staying, and getting clear on those before you start weighing your options, is a good place to start.
Sean Pyles: To what extent did you have that conversation with yourself or maybe with those around you around, “OK, if I leave this job, I might be making a little bit less, but I will be that much happier.” Or, “If I go to this job, I’ll be making a good amount more, but it’s going to be a boring job.” How did you think about those things?
Liz Renter: It’s tough. I probably had limited discussions. So as a single mom, it was just me and my daughter at the time, who was probably 4 when I made the first job change, maybe 7 when I made the second job change. So there weren’t a lot of people for me to toss these ideas around with. And I’m an extremely private person, but these were conversations I was having with myself. And in the first job going from state government to private industry, I realized in state government that, yes, the paycheck is steady, the benefits are nice, but I really love to work hard.
And in my experience, this government job, you were rewarded for how long you were there, not how well you were doing. And that was tough to deal with, and it really bred apathy among the people around me. I wanted to be somewhere where I could work hard and that would be recognized. So that’s not to say that all government workers are taking naps at their desk. That definitely wasn’t my experience, but personally, I wasn’t being recognized for the hard work that I was doing, and that was really important to me.
Sean Pyles: Right. That makes sense.
Liz Renter: And so that one was really more about the professional rewards of working. And then the second one, it was more about the trade-offs. Am I willing to give up some of those professional rewards to really fulfill my personal life? So as I said, my daughter was really young at the time, I was dropping her off early in the morning, I was picking her up after work, sometimes 12 hours later. And the job was paying more than my state government job, but I definitely felt like I was punching a clock and I wasn’t fulfilled, and I totally could not see myself doing that for years upon years. And I knew leaving that job meant I would absolutely take a decrease in pay, at least in the short term, as I got on my feet as a self-employed freelance writer. But when I balanced that against what was really important to me and what was going to make me happy and make me feel good about the way I was living my life, it was a no-brainer.
Sara Rathner: Yeah. I’ve known people who’ve switched jobs out of boredom and ended up regretting it, actually, because the reason they were bored at their previous job was they’d done it for a while and it became rote. But they realized leaving for a greater challenge meant giving up maybe some of the work-life balance and predictability that came with a job that was quote, unquote, “boring,” and they had to make pretty big structural changes to how they operated at home with their household, with their family, to accommodate the new challenges of a new career.
Sean Pyles: Kind of goes back to the idea that it’s not what decision you make, it’s what you do with the decision that you make. If you do leave a job that you’re bored at and you find that your next gig isn’t quite what you wanted it to be, there are going to be other opportunities later on.
Sara Rathner: Yeah.
Liz Renter: I think that’s a good point. When I went into freelancing and I knew I was going to take a pay cut and I was banking on turning that around in a year or two, I always had that in the back of my head like, “OK, worst-case scenario, I’ll get a part-time job for when my daughter’s in school,” or, “Worst worst-case scenario, I’ll go back to working full time.” With a reassessment of maybe I find something that’s closer to home so there’s less of a commute, what have you. But I think knowing that, “OK, I’ve thought through why I want to do it. I know this is the move I want to make, but just in case, I have these outs and these would be perfectly acceptable if things didn’t work out once I make this decision.”
Sean Pyles: Yeah. And I think your experience demonstrates how important it is to think through various scenarios. What could you fall back on if you do need to make a change after this job switch maybe doesn’t pan out how you thought it was going to.
Liz Renter: Right. I think if you’re planning well enough in advance, if you’re sitting around listening to this podcast thinking about, “Well, I’ve been thinking maybe I’m not happy where I am and maybe I should be considering this,” now’s a great time to make sure that, and I know we talk about this a lot on podcast, but make sure that your emergency fund is in place. Maybe cushion it a little bit more. You want to set these guardrails for, OK, sometimes we make decisions with what we think is all the right information and it turns not to work out the way we expected. So if you have those extra guardrails up, just in case, it can make you feel more secure moving forward with your decision when it’s time.
Sara Rathner: Yeah. And keep your professional network warm. Because it is a risk to take a new job, and sometimes you take a new job and hate it immediately, and you’re like, “I’m just going to job hunt again.” And so by keeping that network warm, by staying in touch with old co-workers or friends or relatives who maybe have some professional connections that would be helpful to you, you still also have an out. Not just financially, but also professionally where you’re still open to hearing about opportunities. Because if the jump that you made ended up being a pretty bad bet, then you’re still pursuing other places you could go and you haven’t closed off all the doors to that.
Sean Pyles: Well, now I want to talk about the counterpoint. About when it actually might be a good idea to stick around at a job. Conventional wisdom, at least among millennials, is that you shouldn’t stay at a job for too long because you’ll probably be able to earn more money going to a different job after a couple years. But sometimes staying at a job for potentially several years can be the best choice for people. So let’s discuss that. Liz, you’ve been at NerdWallet nine years, so what’s kept you around and how do you think about that sort of equation?
Liz Renter: So it’s interesting to think back at how this has changed over the generations because, definitely my grandparents to a certain extent and a little bit my parents as well, those generations you were rewarded for just staying where you were. You get a good job with good benefits and you don’t leave for 50 years, and then they throw you this big party. And that’s changed over the years where there’s more mobility and we can experience different opportunities. And I think there’s room for both of that. A little bit of each. So if you are the type that really wants to be loyal to a single company and wants that stability and you’re happy with what you’re getting paid, you don’t have to keep chasing 5% salary increases at other companies. That’s not a requirement. If you’re good where you are, you like your work and you’re working towards your long-term financial goals, that’s totally acceptable. You don’t have to get in on this hustle life.
Sean Pyles: That can also be a good way to approach things, given that the macroeconomic conditions right now are a little shaky. Many companies still have the policy of last in, first out when it comes to layoffs. So for this year in particular, it might not be a bad idea to stick around if you do like the job that you have.
Liz Renter: Right. People are still leaving their jobs at really high rates, but they’re getting into new jobs at really high rates. The unemployment rate hasn’t ticked up, which means people that are leaving their jobs aren’t filing for unemployment, they’re going elsewhere. So that’s a positive sign if you do want to change jobs. But to your point, Sean, there is a lot of uncertainty, and if you’re risk intolerant, it might make sense to sit tight for a while and see how things shake out.
Sean Pyles: Well, Liz, do you have any final thoughts for those who might be thinking about switching jobs right now?
Liz Renter: I would say, yes, it’s as complicated as you think it is. I envision it as you’ve got all of these scales in front of you that you’re trying to balance and you’re trying to figure out, “OK, if I take away this much of my work-life balance, how much salary do I have to add to make it worthwhile?” Or, “If I take away the cold brew in the kitchen, how much of a cell phone stipend do I need to add to make it worthwhile?” So there’s all these scales you’re trying to balance here, and it’s a lot to think about. So you just do the best you can, set up some guardrails just in case things don’t go well.
Sean Pyles: And maybe take your time making a decision. Don’t rush into anything too hastily. Otherwise, the scales may just collapse and go crazy.
Sean Pyles: All right, well thank you so much for talking with us, Liz.
Liz Renter: Thanks for having me again.
Sean Pyles: All right, and with that, let’s get into our takeaway tips. Sara, will you please start us off?
Sara Rathner: Sure. First, know what you’re getting. Compensation can include a lot more than the cash you get. Understand your total compensation ahead of any job hunt.
Sean Pyles: Next up, go beyond the math. Jobs are about a lot more than the money. Consider things like personal fulfillment and work-life balance when weighing other job options.
Sara Rathner: Finally, there’s nothing wrong with sticking around. If you’re fulfilled and well compensated in your current position, staying put might be your best option.
Sean Pyles: And that is all we have for this episode. Do you have a money question of your own? Turn to the Nerds and call or text us your questions at 901-730-6373. That’s 901-730-N-E-R-D. You can also email us at [email protected] Visit nerdwallet.com/podcast for more info on this episode. And remember to follow, rate and review us wherever you’re getting this podcast.
Sara Rathner: And here’s our brief disclaimer. We are not financial or investment advisors. This nerdy info is provided for general educational and entertainment purposes and may not apply to your specific circumstances.
Sean Pyles: This episode was produced by Liz Weston, Tess Vigeland and myself. Kaely Monahan mixed our audio. And a big thank-you as always to the folks on the NerdWallet copy desk. And with that said, until next time, turn to the Nerds.