When getting your first credit card, consider factors such as the card’s annual fees, interest rates, rewards or benefits, and credit limit. Choose a card that aligns with your financial goals and spending habits, and make sure to understand the terms and conditions, including the consequences of late payments or carrying a balance. Additionally, aim to use the card responsibly to build positive credit history while avoiding overspending and accumulating debt.
With so many credit cards on the market, getting your first card can be overwhelming. What type of card do you need? How often should you use the card? Is it possible to have a credit card without racking up large amounts of debt you can’t repay?
Keep reading for answers to these frequently asked questions about getting and using a credit card for the first time.
What Is a Credit Card?
A credit card is a type of revolving account that allows you to spend up to a preset limit. Every month, the issuer calculates your minimum payment due based on your recent activity.
One of the main differences between a credit card and a loan is that loans have a fixed number of payments. With a credit card, you can keep making purchases until you reach your preset spending limit, and each time you make a payment, it frees up some of your available credit. This allows you to keep using the line of credit over to purchase goods and services over and over.
Types of Credit Cards
Before you apply for your first credit card, make sure you understand the differences between secured and unsecured credit. If you want to open a secured credit card, you’ll have to make a deposit. The issuer uses that deposit to set your credit limit. For example, if you deposit $500, you should start out with a limit of $500.
One of the biggest advantages of opening a secured credit card is that you can’t overspend. If you don’t pay back the money you borrowed, the issuer can close your account and keep the deposit.
An unsecured credit card doesn’t require a deposit, so the issuer sets your spending limit based on your income and credit history. If you don’t repay what you borrowed, the company can send your account to collections or do a charge-off, both of which would have a negative impact on your credit health.
Pros and Cons of Getting a Credit Card
Like any financial product, credit cards have several pros and cons. Review them carefully before you decide to apply for your first credit card.
Advantages of Credit Cards
The main advantage of having a credit card is that it gives you extra purchasing power. For example, if you don’t have quite enough money saved for your auto insurance premium, you can use a credit card to make your payment.
Having a credit card also helps build a strong credit profile, provided you use the card wisely. Your credit score is based on several factors, such as your payment history and the number of credit accounts you have open. When you open a credit card, you have an opportunity to demonstrate responsible financial behavior, which could improve your credit.
Credit cards also have these benefits:
Fraud protection. Credit cards have several features designed to guard against fraud. Additionally, it’s easier to deal with fraudulent transactions on a credit card than on a debit card. If you use a debit card, the fraudulent transaction ties up some of your money until you can convince the bank to issue a provisional credit. When you use credit cards, you’re using the bank’s money, so none of your money is ever at risk.
Rewards. Many companies offer credit cards that give you points, miles, cash back, and other perks. Rewards credit cards let you earn valuable benefits based on your everyday spending habits. For example, if you enjoy dining out, you may want to look for a credit card that offers extra cash back on restaurant purchases.
Wide acceptance. Thousands of merchants accept credit cards, so you don’t have to worry about carrying cash or coming up with another form of payment. Carrying a credit card may even help you avoid having a hold put on your funds when you rent a car or book a hotel room.
Disadvantages of Credit Cards
One of the biggest disadvantages of using a credit card is that it’s easy to overspend, especially if you have a high limit. To reap the benefits of using a credit card without the stress of worrying about your minimum payment, charge only what you can afford to pay in full each month.
Many credit cards also have high interest rates. If you don’t pay your balance in full every month, you’ll have to pay interest on all purchases, cash advances, and balance transfers. Interest charges add up quickly, making it difficult to pay off your balance.
Although credit cards can be very beneficial, you need to use them responsibly. Late payments, missed payments, and other credit mishaps can hurt your credit for many years to come.
How to Choose Your First Credit Card
Before you apply for your first credit card, take time to check your credit score and report. If you know your credit, it will be easier to find a credit card company willing to issue a card to someone with your credit profile. If you have poor credit, you may need to open a secured card or accept a credit card with a low limit before you can qualify for better cards.
When you’re ready to apply, look for a card that fits your needs. If your goal is to build credit, search for a card with automatic credit line reviews or other features designed to help users improve their financial situations. If you travel frequently, consider getting a rewards credit card to help you earn cash back or bonus points.
Now you’re ready to apply for a card. When you fill out the application, you’ll need to provide your name, contact details, and information about your financial situation. If you aren’t approved, you’ll receive a letter explaining the reason for denial.
Tips for Using Your Credit Card Wisely
To avoid the drawbacks associated with credit cards, follow these tips:
Make on-time payments. Payment history has a big impact on your credit health. To build a strong credit profile, pay your bill on time each month.
Pay more than the minimum. If you only pay the minimum amount due, it may take several years to pay your balance in full. Avoid high interest charges by paying more than the minimum due each month.
Don’t go over your limit. Going over your limit increases your credit utilization ratio, which is a red flag to lenders. Many companies also charge over-limit fees that make exceeding your limit expensive, so try to avoid doing this.
Limit your applications: Every time you apply for a credit card, the issuer checks your credit report, resulting in a hard inquiry. Lenders see many hard inquiries in a short amount of time as a sign that you may be in financial trouble, so it’s best to limit the number of inquiries on your record.
You can visit Credit.com today to get started on your credit card journey by comparing different cards, checking your credit score and credit report card, and learning more about how to manage your finances responsibly.
Inside: Learn what 27 an hour is how much a year, month, and day. Plus tips to budget your money. Don’t miss the ways to increase your income.
You’re probably wondering if I made $27 a year, how much do I truly make? What will that add up to over the course of the year when working? Is $27 an hour good?
Is this wage something that I can actually live on? Or do I need to find ways that I can increase my hourly wage? How much more is $27.50 an hour annually?
When you finally start earning $27 an hour, you are happy with your progress as an hourly employee. Typically, this is when many hourly employees start to become salaried workers.
In this post, we’re going to detail exactly what $27 an hour is how much a year. Also, we are going to break it down to know how much is made per month, bi-weekly, per week, and daily.
That will help you immensely with how you spend your money. Because too many times the hard-earned cash is brought home, but there is no actual plan for how to spend that money.
By taking a step ahead and making a plan for the money, you are better able to decide how you want to live, make sure that you put your money goals first, and not just living paycheck to paycheck struggling to survive.
The ultimate goal with money success is to be wise with how you spend your money.
If that is something you want too, then keep reading. You are in the right place.
$27 an Hour is How Much a Year?
When we ran all of our numbers to figure out how much is $27 per hour is as an annual salary, we used the average working day of 40 hours a week.
40 hours x 52 weeks x $27 = $56,160
$56,160 is the gross annual salary with a $27 per hour wage.
As of June 2023, the average hourly wage is $33.58 (source).
Breakdown Of 27 Dollars An Hour Is How Much A Year
Typically, the average workweek is 40 hours and you can work 52 weeks a year. Take 40 hours times 52 weeks and that equals 2,080 working hours. Then, multiply the hourly salary of $27 times 2,080 working hours, and the result is $56,160.
That number is the gross income before taxes, insurance, 401K, or anything else is taken out. Net income is how much you deposit into your bank account.
That is just above the $56000 salary threshold, which is desired for a recent college graduate.
Work Part Time?
But you may think, oh wait, I’m only working part-time. So if you’re working part-time, the assumption is working 20 hours a week at $27 an hour.
Only 20 hours per week. Then, take 20 hours times 52 weeks and that equals 1,040 working hours. Then, multiply the hourly salary of $27 times 1,040 working hours and the result is $28,080.
How Much is $27 Per Month?
On average, the monthly amount would average $4,680.
Annual Amount of $56,160 ÷ 12 months = $4,680 per month
Since some months have more days and fewer days like February, you can expect months with more days to have a bigger paycheck. Also, this can be heavily influenced by how often you are paid and on which days you get paid.
Plus by increasing your wage from $25 an hour, you average an extra $347 per month. So, yes a few more dollars an hour add up!
Work Part Time?
Only 20 hours per week. Then, the monthly amount would average $2,340.
How Much is $27 per Hour Per Week
This is a great number to know! How much do I make each week? When I roll out of bed and do my job, what can I expect to make at the end of the week?
Once again, the assumption is 40 hours worked.
40 hours x $27 = $1,080 per week.
Work Part Time?
Only 20 hours per week. Then, the weekly amount would be $540.
How Much is $27 per Hour Bi-Weekly
For this calculation, take the average weekly pay of $1,080 and double it.
$1,080 per week x 2 = $2,160
Also, the other way to calculate this is:
40 hours x 2 weeks x $27 an hour = $2,160
Work Part Time?
Only 20 hours per week. Then, the bi-weekly amount would be $1,080.
How Much is $27 Per Hour Per Day
This depends on how many hours you work in a day. For this example, we are going to use an eight-hour workday.
8 hours x $27 per hour = $216 per day.
If you work 10 hours a day for four days, then you would make $270 per day. (10 hours x $27 per hour)
Work Part Time?
Only 4 hours per day. Then, the daily amount would be $108.
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$27 Per Hour is…
$27 per Hour – Full Time
Total Income
Yearly Salary (52 weeks)
$56,160
Yearly Wage (50 weeks)
$55,000
Monthly Salary (173 hours)
$4,680
Weekly Wage (40 Hours)
$1,080
Bi-Weekly Wage (80 Hours)
$2,160
Daily Wage (8 Hours)
$216
Net Estimated Monthly Income
$3,573
**These are assumptions based on simple scenarios.
Paid Time Off Earning 27 Dollars an Hour
Does your employer offer paid time off?
As an hourly employee, you may or may not get paid time off.
So, here are the scenarios for both cases.
For general purposes, we are going to assume you work 40 hours per week over the course of the year.
Case # 1 – With Paid Time Off
Most hourly employees get two weeks of paid time off which is equivalent to 2 weeks of paid time off.
In this case, you would make $56,160 per year.
This is the same as the example above for an annual salary making $27 per hour.
Case #2 – No Paid Time Off
Unfortunately, not all employers offer paid time off to their hourly employees. While that is unfortunate, it is best to plan for less income.
Life happens. There will be times you need to take time off for numerous reasons – sick time, handling an emergency, or even vacation.
So, let’s assume you take 2 weeks off without paid time off.
That means you would only work 50 weeks of the year instead of all 52 weeks. Take 40 hours times 50 weeks and that equals 2,000 working hours. Then, multiply the hourly salary of $27 times 2,000 working hours, and the result is $55,000.
40 hours x 50 weeks x $27 = $54,000
You would average $208 per working day and nothing when you don’t work.
$27 an Hour is How Much a year After Taxes
Let’s be honest… Taxes can take up a big chunk of your paycheck. Thus, you need to know how taxes can affect your hourly wage.
Also, every single person’s tax situation is different.
On the basic level, let’s assume a 12% federal tax rate and a 4% state rate. Plus a percentage is taken out for Social Security and Medicare (FICA) of 7.65%.
Gross Annual Salary: $56,160
Federal Taxes of 12%: $6,739
State Taxes of 4%: $2,246
Social Security and Medicare of 7.65%: $4,296
$27 an Hour per Year after Taxes: $42,878
This would be your net annual salary after taxes.
To turn that back into an hourly wage, the assumption is working 2,080 hours.
$42,878 ÷ 2,080 hours = $20.61 per hour
After estimated taxes and FICA, you are netting $20.61 an hour. That is $6.39 an hour less than what you thought you were paid.
This is a very highlighted example and can vary greatly depending on your personal situation. Therefore, here is a great tool to help you figure out how much your net paycheck would be.
Plus budgeting on a just over $20 an hour wage is much different.
$27 An Hour Salary Calculator
Now, you get to figure out how much you make based on your hours worked or if you make a wage between $27.01-27.99.
This is super helpful if you make $27.30, $27.40, or $27.88.
$27 an Hour Budget – Example
You are probably wondering can I live on my own making 27 dollars an hour? How much rent or mortgage payment can you afford on 27 an hour?
Using our Cents Plan Formula, this is the best-case scenario on how to budget your $27 per hour paycheck.
When using these percentages, it is best to use net income because taxes must be paid.
In this example, above we calculated that $27 an hour was $20.61 after taxes. That would average $3573 per month.
According to the Cents Plan Formula, here is the high-level view of a $27 per hour budget:
Basic Expenses of 50% = $1787
Save Money of 20% = $715
Give Money of 10% = $357
Fun Spending of 20% = $715
Debt of 0% = $0
Obviously, that is not doable for everyone. Even though you would expect your money to go further when you are making double the minimum wage. So, you have to be strategic in ways to decrease your basic expenses and debt. Then, it will allow you more money to save and fun spending.
To further break down an example budget of $27 per hour, then using the ideal household percentages is extremely helpful.
recommended budget percentages based on $27 per hour wage:
Category
Ideal Percentages
Sample Monthly Budget
Giving
10%
$468
Savings
15-25%
$936
Housing
20-30%
$1,076
Utilities
4-7%
$140
Groceries
5-12%
$311
Clothing
1-4%
$19
Transportation
4-10%
$164
Medical
5-12%
$234
Life Insurance
1%
$14
Education
1-4%
$23
Personal
2-7%
$70
Recreation / Entertainment
3-8%
$117
Debts
0% – Goal
$0
Government Tax (including Income Taxes, Social Security & Medicare)
15-25%
$1,107
Total Gross Income
$4,680
**In this budget, prioritization was given to basic expenses. Thus, some categories like giving and saving were less.
Can I Live off $27 Per Hour?
At this $27 hourly wage, you are more than likely double the minimum wage. Things should be easy to live off this $27 hourly salary.
However, it is still slightly above the $55,000 salary. That means it can still be a tough situation.
Is it doable? Absolutely.
In fact, $27 an hour is higher than the median hourly wage of $19.33 (source). That seems backward, but typically salaried workers earn more per hour than hourly workers.
Can you truly live off $27 an hour annually?
You just have to have the desire to spend less than your income. Plus consistently save.
If you are constantly struggling to keep up with bills and expenses, then you need to break that constant cycle. It is possible to be smart with money.
You need to do is change your money mindset.
This is what you say to yourself… Okay, I have aspirations and goals to increase how much I make. This is the time to start diversifying my income into multiple streams and start investing. I am going to stretch my 27 dollars per hour.
In the next section, we will dig into ways to increase your income, but for now, is it possible to live on $27 an hour.
Yes, you can do it, and as you can see it is possible with the sample budget of $27 per hour.
Living in a higher cost of living area would be more difficult. So, you may have to get a little creative. For example, you might have to have a roommate. Move to a lower cost of living area where rent is cheaper.
Also, you must evaluate your “fun spending” items. Many of those expenses are not mandatory and will break your budget. You can find plenty of free things to do without spending money.
5 Ways to Increase Your Hourly Wage
This right here is the most important section of this post.
You need to figure out ways to increase your hourly income because I’m going to tell you…you deserve more. You do a good job and your value is higher than what your employers pay you.
Even an increase of 50 cents to $27.50 will add up over the year. An increase to $28 an hour is even better!
1. Ask for a Raise
The first thing to do is ask for a raise. Walk right in and ask for a raise because you never know what the answer will be until you ask.
If you want the best tips on how specifically to ask for a raise and what the average wage is for somebody doing your job, then check out this book. In this book, the author gives you the exact way to increase your income. The purchase is worth it or go down to the library and check that book out.
2. Look for A New Job
Another way to increase your hourly wage is to look for a new job. Maybe a completely new industry.
It might be a total change for you, but many times, if you want to change your financial situation, then that starts with a career change. Maybe you’re stressed out at work.
Making $27 an hour is too much for you and you’re not able to enjoy life, maybe changing jobs and finding another job may increase your pay, but it will also increase your quality of life.
3. Find a New Career
Because of student loans, too many employees feel like they are stuck in the career field they chose. They feel sucked into the job that they don’t like or have the potential they thought it would.
For many years, I was in the same situation until I decided to do a complete career change. I am glad I did. I have the flexibility that I needed in my life to do what I wanted when I needed to do it. Plus I am able to enjoy my entrepreneurial spirit.
4. Find Alternative Ways to Make Money
In today’s society, you need to find ways to make more money. Period.
There is no way to get around it. You need to find additional income outside a traditional nine-to-five position or typical 40 hour a week job. You will reach a point where you are maxed on what you can make in your current position or title. There may be some advancement to move forward, but in many cases, there just is not much room for growth.
So, you need to find a side hustle – another way to make money.
Do something that you enjoy, turn your hobby into a way to make money, turn something that you naturally do, and help others into a service business. In today’s society, the sky is the limit on how you can earn a freelancing income.
Must Read: 20 Genius Ways on How to Make Money Fast
5. Earn Passive Income
The last way to increase your hourly wage is to start earning passive income.
This can be from a variety of ways including the stock market, real estate, online courses, book sales, etc. This is where the differentiation between struggling financially and becoming financially sound.
By earning money passively, you are able to do the things that you enjoy doing and not be loaded down, with having a job that you need to work, and a place that you have to go to. And you still make money doing nothing.
Here is an example:
You can start a brokerage account and start trading stocks for $50. You need to learn and take the one and only investing class I recommend. Learn how the market works, watch videos, and practice in a simulator before you start using your own money.
One gentleman started with $5,000 in his trading account and now has well over $36,000 in a year. Just from practice and being consistent, he has learned that passive income is the way for him to increase his income and also not be a slave to his job.
Watch his inspiring story!
Tips to Live on $27 an Hour
In this last section, grasp these tips on how to live on $27 an hour or just above $55k yearly salary. On our site, you can find lots of money saving tips to help stretch your income further.
Here are the most important tips to live on $27 an hour. More importantly stretch how much you make, in case you are in the “I don’t want to work anymore” mindset. Highlight these!
1. Spend Less Than you Make
First, you must learn to spend less than you make.
If not you will be caught in the debt cycle and that is not where you want to be. You will be consistently living paycheck to paycheck.
In order to break that dreadful cycle, it means your expenses must be less than your income.
And when I say income, it’s not the $27 an hour. As we talked about earlier in the post, there are taxes. The amount of taxes taken out of your paycheck is called your net income which is $27 an hour minus all the taxes, FICA, Social Security, and Medicare are taken out. That is your net income.
So, your net income has to be less than your net income.
2. Living Below Your Means
You need to be happy. And living on less can actually make you happier. Studies prove that less is better.
Finding contentment in life is one thing that is a struggle for most.
We are driven to want the new shiny toy, the thing next door, the stuff your friend or family member got. Our society has trained you that you need these things as well.
Have you ever taken a step back and looked at what you really need?
Once you are able to find contentment with life, then you are going to be set for the long term with your finances.
Here is our story on owning less stuff. We have been happier since.
3. Make Saving Money Fun
You need to make saving money fun. If you’re good, since you must keep your expenses low, you have to find ways to make your savings fun!
It could be participating in a no spend challenge for the month.
It could be challenging friends not to go to Target for a week.
Maybe changing your habits and not picking up takeout and planning meals.
Start to save 5000 in a year.
Whatever it is challenge yourself.
Find new ways of saving money and have fun with it.
Even better, get your family and kids involved in the challenge to save money. Tell them the reason why you are saving money and this is what you are doing.
Here are 101 things to do with no money. Free activities without costing you a dime. That is an amazing resource for you and you will never be bored.
And you will learn a lot of things in life you can do for free. Personally, some of the best ones are getting outside and enjoying some fresh air.
4. Make More Money
If you want if you do not settle for less, then find ways to make more money. If you want more out of life, then increase your income.
You need to be an advocate for yourself.
Find ways to make more money.
It could be a side hustle, a second job, asking for a raise, going to school to change careers, or picking up extra hours.
Whatever path you take, that’s fine. Just find ways to make more money. Period.
5. No State Taxes
Paying taxes is one option to increase what you take home in each paycheck.
These are the states that don’t pay state income taxes on wages:
Alaska
Florida
Nevada
New Hampshire
South Dakota
Tennessee
Texas
Washington
Wyoming
It is very interesting if you take into account the amount of state taxes paid compared to a state with income taxes.
Also, if you live in one of the higher taxed states, then you may want to reconsider moving to a lower cost of living area. The higher taxes income tax states include California, Hawaii, New Jersey, Oregon, Minnesota, the District of Columbia, New York, Vermont, Iowa, and Wisconsin. These states tax income somewhere between 7.65% – 13.3%.
6. Stick to a Budget
You need to learn how to start a budget. We have tons of budgeting resources for you.
While creating a budget is great, you need to learn how to use one.
You do not have to budget down to every last penny.
You need to make sure your expenses are less than your income and that you are creating sinking funds for those irregular expenses.
Budget Help:
7. Pay Off Debt Quickly
The amount that you pay interest on debt is absolutely absurd.
Unfortunately, that is how many of these companies make their money from the interest you pay on debt.
If you are paying 5% to even 20-21% or higher, you need to find ways to lower that debt quickly.
Here’s a debt calculator to help you. Figure out your debt-free date.
Make that paying off debt fast is your target and main focus. I can tell you from personal experience, that it was not until we paid off our debt that we finally rounded the corner financially. Once our debt was paid off, we could finally be able to save money. Set money aside in separate bank accounts and pay for cash for things.
It took us working hard to pay off debt. We needed persistence and patience while we had setbacks in our debt-free journey.
Jobs that Pay $27 an Hour
You can find jobs that pay $27 per hour. Polish up that resume, cover letter, and interview skills.
Job Search Hint: Always send a written follow-up thank you note for your interview. That will help you get noticed and remembered.
First, look at the cities that require a minimum wage in their cities. That is the best place to start to find jobs that are going to pay higher than the federal minimum wage rate. Many of the cities are moving towards this model so, target and look for jobs in those areas.
Possible Ideas:
Virtual Assistant – Get free training NOW!
Freelance writer
Class A Truck Driver
Managers
Entry Level Marketing Jobs
Data Entry Clerks
Customer service managers
Bank tellers
Maintenance workers
Freight broker – Learn how easy it is to start!
Administrative assistants
Athletic Trainers
Event Planners
Day trader
Security guard
Movers
Warehouse workers
Electrician
Licensed Practical Nurse (LPN)
Companies that pay more than $27 per hour: Wells Fargo, Disney World, Disney Land, Bank of America, Cigna, Aetna, etc
$27 Per Hour Annual Salary
In this post, we detailed 27 an hour is how much a year. Plus all of the variables that can impact your net income. This is something that you can live off.
How much is 27 dollars an hour annually…
$56,160
This is right between $56000 per year and $57k a year.
In this post, we highlighted ways to increase your income as well as tips for living off your wage.
Use the sample budget as a starting point with your expenses.
You will have to be savvy and wise with your hard-earned income. But, with a plan, anything is possible!
Still thinking I don’t want to work anymore, you aren’t alone and need to start to plan for your early retirement.
Learn exactly how much do I make per year…
Know someone else that needs this, too? Then, please share!!
Did the post resonate with you?
More importantly, did I answer the questions you have about this topic? Let me know in the comments if I can help in some other way!
Your comments are not just welcomed; they’re an integral part of our community. Let’s continue the conversation and explore how these ideas align with your journey towards Money Bliss.
The most surefire way to get out of debt is to create a detailed budget, prioritize paying off debts with the highest interest rates first while making minimum payments on others, and consistently allocate extra funds toward debt repayment until all balances are cleared. Additionally, consider seeking professional financial advice to explore options like debt consolidation or settlement if necessary.
In the fourth quarter of 2023, the amount of household debt in the United States increased to $17.5 trillion. Although credit cards, mortgages, and loans have several benefits, some consumers have trouble repaying what they borrowed. If you’ve been struggling to get your finances on track, learn how to get out of debt by creating a budget, earning extra money, and adjusting your spending habits.
1. Identify Your “Why”
Everyone needs a little motivation from time to time. Before you start your debt-free journey, it’s important to identify your “why,” or your main reason for getting out of debt. Here are a few ideas to get you started:
You don’t want the stress of making minimum payments every month.
You’re tired of being behind on your bills.
You’d rather put extra money in your savings account than spend it on debt payments.
You want to create a strong financial future for your family.
You need to set aside funds to care for a child with special needs.
You’re tired of arguing with your spouse or partner about money.
You don’t want your kids to have to take out thousands of dollars in loans to pay for college.
You want to travel around the world while you’re healthy enough to enjoy it.
2. Assess Your Current Situation
Before you start making extra payments, review your bank and credit card statements to determine how much you’ve been spending each month. Be sure to include every expense, no matter how small, from snacks to streaming subscriptions.
Once you have a handle on your expenses, make a list of credit cards, loans, and other debts. For each debt, note the creditor’s name, the balance due, and the minimum monthly payment. At the bottom of the page, add up your balances to determine the total amount of debt you have.
3. Review Your Spending Habits
Next, look at the list of expenses from the previous step. Ask yourself these questions:
Are there any duplicate expenses, such as two charges for the same subscription?
Can you eliminate any of the items on your list?
Are you spending more than you earn each month?
The answers to these questions will help you determine how to get out of debt faster. For example, if you’re spending more than you earn each month, your priority should be to increase your income or reduce your expenses to eliminate the shortfall.
As you review your expenses, see if you can identify any spending triggers, which are things that cause you to spend money impulsively. Limited-time discounts, negative emotions, envy, and boredom are examples of triggers that may lead to increased spending.
Once you identify your triggers, work to eliminate them. For example, if you notice you buy something every time you receive a weekly email from your favorite retailer, consider unsubscribing from the retailer’s email list.
4. Make a Budget
If you think budgeting is only for people with lower incomes, think again. Having a budget makes it easier to get your finances on track, regardless of whether you earn $40,000 or $400,000 per year. To create a personal budget, follow these steps:
Calculate your net income from all sources. Your net income is the amount of money remaining after taxes, health insurance premiums, and other deductions are taken from your paycheck.
Add up your monthly expenses.
Subtract your expenses from your net income. If the result is positive, you have some money left over each month. A negative result indicates you’re spending more than you earn.
Here’s an example to help you understand the process:
Cassandra nets $2,247 per month from her full-time job and $325 per month from her side hustle. Her net income is $2,572.
Cassandra shares a two-bedroom apartment with a friend from college, so she pays just $750 per month in rent. She also spends $350 per month on groceries, $218 per month on student loan payments, $150 per month on utilities, $175 per month on public transportation, and $829 per month on clothing, toiletries, entertainment, and other personal expenses. Her expenses add up to $2,472 per month.
After subtracting $2,472 in expenses from $2,572 in net income, Cassandra has $100 left over.
If you have trouble keeping track of your income and expenses, use this monthly budgeting sheet.
5. Find Ways to Increase Your Income
Slashing your expenses is a great start, but if you have a significant amount of debt, you’ll also want to increase your income. The more income you have, the easier it is to pay off debt quickly.
To maximize your earning potential, do at least one of the following:
Apply for a part-time job.
Start a service-based business in your neighborhood.
Sell clothing, accessories, and household items via online marketplaces.
Deliver for DoorDash, Instacart, Grubhub, or Uber Eats.
Become a driver for Uber or Lyft.
If you start your own business or work as an independent contractor, you’ll have to pay self-employment taxes on your net income. To avoid having a large tax bill on April 15, it’s wise to make estimated quarterly payments.
6. Focus on One Thing at a Time
You have a finite amount of resources, so rather than trying to tackle multiple goals at one time, pick a goal and stick with it. For example, if you have three credit cards, focus on paying one of them in full. You can worry about the other credit cards later.
7. Set Short-Term and Long-Term Goals
Learning how to get out of debt doesn’t happen overnight. If you have multiple accounts, it may take several years to pay them all in full. It’s easy to get discouraged if you have to wait years to celebrate an accomplishment.
To stay motivated, choose a mix of short-term and long-term goals. If your long-term goal is to pay off your credit card debt, a good short-term goal might be to pay off one credit card with a $500 balance. Paying off a small debt gives you a sense of accomplishment, helping you stay motivated.
8. Choose a Debt Payoff Method
Once you have your goals in mind, you need to choose a debt payoff method. You can use the debt snowball or the debt avalanche:
Debt snowball: With the snowball method, you pay off your debts in order of smallest balance to largest balance. For example, if you have debts of $500, $750, and $1,000, you’d pay them off in that order. Each time you pay off a debt, you free up more money to tackle the other accounts.
Debt avalanche: To use the debt avalanche method, list your debts according to their interest rates, with the highest rates at the top of the list and the lowest rates at the bottom. For example, if you have a $3,000 loan with an interest rate of 19% and a $1,500 credit card balance with an interest rate of 28%, you’d pay off the credit card debt first, even though the loan balance is higher.
The snowball method gives you a psychological boost every time you pay a balance in full, so some people find it easier to follow than the avalanche method. However, you may end up paying more in interest if you don’t pay off high-interest balances quickly.
With the debt avalanche method, the opposite is true. You pay less in interest, but it also takes longer to pay off each account, which may leave you struggling to stay motivated.
9. Set Up Automatic Payments
Make things easy on yourself by setting up automatic payments for the minimum balance on each debt. If you have extra money, you can always make a second payment later in the month. Automatic payments eliminate the need to remember your due date, reducing the risk of late or missed payments, which can have a drastic impact on your credit.
10. Apply for a Balance Transfer Credit Card With 0% Interest
If you have a good credit score, consider applying for a balance transfer card with a 0% APR. The promotional APR lasts for a limited amount of time, but it could help you pay off high-interest debt much faster.
For example, if you have a $1,000 balance on a high-interest credit card, you can move it to a balance-transfer card with 0% interest for 12 months. Just make sure you pay off the balance transfer before the promotional period expires.
If you don’t have the credit needed to qualify for a balance transfer card, sign up for credit monitoring to help you determine when your credit has improved enough to apply for a new account.
You can learn more about managing debt and other financial topics at Credit.com.
Maybe you’ve recently spoken to a broker or financial adviser about investments, and they suggested exchange-traded funds (ETFs) as a way to diversify your portfolio and boost your earnings.
But, you don’t know how they work or how to go about adding them to your arsenal of investments. Or perhaps you’re just starting out and want to learn more before making an investment decision?
Either way, we’ve got you covered. Read on to learn more.
Key Takeaways
Exchange-traded funds (ETFs) are diversified investment vehicles that allow investors to buy shares in a collection of assets, ranging from stocks and bonds to commodities and currencies, functioning similarly to mutual funds, but trading like stocks on exchanges.
ETFs offer various types, including those focused on specific industries, commodities, or strategies like inverse or leveraged ETFs, catering to a wide range of investment objectives and risk tolerances.
The benefits of ETFs include lower administrative costs compared to mutual funds, flexibility in trading throughout the trading day, tax efficiency in capital gains, and the transparency of holding disclosure, making them an attractive option for both novice and experienced investors.
What are ETFs?
In a nutshell, an exchange-traded fund (ETF) is a basket of assets that can include a medley of the following:
Exchange-traded funds are ideal for individual investors because they allow you to diversify your holdings without purchasing individual shares of each asset. And the profits are generated by the performance of the overall ETF and not individual shares.
Furthermore, ETFs trade like stocks and are easily bought and sold on the stock exchange, making it simple for investors to buy and sell.
How do ETFs work?
Before exchange-traded funds hit the exchange for trading, they must be created by authorized participants or specialized investors. They conduct extensive research and choose the assets that they deem as most suitable for the portfolio.
The pool of assets is then divided into ETF shares and traded on a major stock exchange, like the NYSE or NASDAQ, or through a brokerage firm.
Each exchange-traded fund has a ticker symbol like a stock and intraday price that can be tracked throughout the day. But unlike mutual funds or index funds, prices are constantly fluctuating because ETF shares are issued and redeemed throughout the day.
Mutual funds are priced at the end of the trading day, so all buyers and sellers receive the same price. This is referred to as the NAV (net asset value.)
Individual investors can purchase ETFs, but the way returns are generated differs from what you’d see with stocks or bonds. Profits are not tied to the actual assets in the ETF, but a sum of the profits generated from interest and dividends from the overall ETF. The return is collectively based on your proportion of ownership in the ETF.
Types of ETFs
There’s no shortage of exchange-traded funds as offerings are designed to track various sectors, markets, and indexes both here in the U.S. and abroad. The types of ETFs that are most popular among investors include:
Actively managed ETFs: ETFs that are managed by a professional fund manager and traded on a stock exchange. They aim to outperform a specific benchmark or index by actively selecting and trading the securities in the fund’s portfolio.
Bond ETFs: ETFs that track a basket of bond securities, such as corporate bonds, government bonds, or municipal bonds.
Commodity ETFs: These ETFs track the price of a specific commodity, such as gold, silver, oil, or agricultural products.
Currency ETFs: ETFs that track the value of a specific currency, such as the US dollar, Euro, or Japanese yen.
Foreign market ETFs: The main objective for these ETFs is to track the performance of a specific foreign market, such as a specific country or region.
Inverse ETFs: A type of ETF that aims to produce the opposite return of a specific benchmark or index.
Leveraged ETFs: These ETFs use financial instruments, such as futures contracts and options, to amplify the returns of a specific benchmark or index.
Market ETFs: The main objective is to track a specific index. These include DIA (tracks the Dow Jones Industrial Average), Spider or SPDR (tracks the S&P 500 Index), and QQQ (tracks the Nasdaq 100).
Sector or Industry ETFs: The main objective is to track a sector or industry. Common sector ETFs include XLF (financial companies), OIH (oil companies), FONE (smartphones), and XLE (energy companies).
Stock ETFs: ETFs that track a basket of stocks, such as those in a specific index, sector, or country.
Benefits of ETFs
Diversified Asset Pool
With ETFs, you can invest with minimal effort to fit your taste in securities, risk tolerance, and investment goals. This also means you can choose from various market segments. Furthermore, poor-performing assets can offset those that are performing well.
Hands-off Management
Professional fund managers do all the work for you according to your investment objectives. They also continuously monitor the performance of the ETF. But since these investments are generally passive and track an index, your fund manager won’t have to spend a bulk of their time day in and day out managing the ETF to stay ahead of the curve.
Quick note: The exception to this rule applies when you’re dealing with an actively managed ETF that is designed to beat an index.
Flexible Purchase and Selling Window
Unlike mutual funds, ETFs are available for purchase at any time of the day. There’s also flexibility with orders as you can choose from margin, limit, or stop-loss orders. Even better, there are no minimum holding periods, like you’ll see with some mutual funds, so you’re free to sell at any point after you purchase ETF shares.
This added flexibility is also beneficial to investors because it minimizes the level of risk they’ll have to absorb if the market takes an unexpected turn for the worse. ETFs are much easier to unload in a shorter window than mutual funds, that sometimes have a 30-day holding period before they can be sold.
Tax Efficient
With taxable mutual funds, you must pay taxes on distributions, regardless of whether you keep the cash or use it to invest in more mutual fund shares. However, you will only pay capital gains on ETFs when your investment is sold.
Transparency
As mentioned earlier, the performance of a particular ETF can be tracked throughout the day using the ticker. And the end of each day, the ETF’s holdings are shared with the public. But mutual funds only disclose this information on a monthly or quarterly basis.
Lower Administrative Costs
Unless the ETF is actively managed, your administrative costs will be substantially lower than what you’d find with a portfolio that must have oversight at all times, like a mutual fund. On average, the expense ratio for most ETFs is lower than .20 per year, compared to the 1% or more per year in administrative costs that accompany actively managed mutual funds, according to Nasdaq.
But keep in mind that expense ratios aren’t the same across the board. So, it’s best to speak with the ETF issuer to get a better idea of what you’d expect to pay in administrative costs should you decide to invest in their ETFs.
Drawbacks of ETFs
Before you invest in ETFs, there are some drawbacks you should be mindful of.
Price Fluctuations
Prices often change, so you could be at a disadvantage if you like to buy in small increments. And it’s not always possible to buy low and sell high if the ETF is a slow mover.
Fees from Commissions
Looking to buy ETFs through an online broker? If you select an ETF that’s outside the scope of what they offer, you could incur substantial fees from brokerage commissions.
Sudden Death
If the ETF underperforms and is forced to shut down abruptly, you have no control over the hit you may take, either through a loss on your investment or tax obligation.
Settlement Window
When you sell ETFs, there’s a two-day settlement window that must pass before you can access your cash. This could be to your disadvantage if you need the funds right away to invest in another asset.
How to Invest in ETFs
To invest in exchange-traded funds (ETFs), you’ll need to follow these steps:
Choose a brokerage: First, select a brokerage firm where you will place your trades. Reputable options include well-known online brokers such as Charles Schwab, E*TRADE, Robinhood, and Fidelity. Be sure to compare fees, trading platforms, and other features before making your decision.
Open an account: Once you’ve chosen a brokerage, you’ll need to open a brokerage account and complete any required paperwork. This may include providing personal and financial information, as well as completing any necessary identity verification steps.
Fund your account: To buy ETFs, you’ll have to deposit money into your brokerage account. This can typically be done by linking a bank account or using a credit or debit card.
Select your ETFs: Once your account is funded, you’ll be able to browse and select the ETFs you’d like to purchase. Most brokerage firms offer a wide range of ETFs to choose from, including those that track specific indexes, sectors, or countries.
Place your trade: Once you’ve selected the ETFs you’d like to purchase, you can place your trade by specifying the quantity and price. Your brokerage firm will handle the rest of the process, including executing the trade and holding the ETF shares in your account.
Keep in mind that investing in ETFs carries risks, and it’s important to do your own research and consider your own financial goals and risk tolerance before making any investment decisions. It’s also a good idea to consult a financial professional for personalized advice.
Bottom Line
It’s easy to buy or sell ETFs and make them part of your investment strategy. By gaining a thorough understanding of how they work and working with a broker to analyze how they will impact your investment portfolio, you’ll have the best chance of maximizing your returns.
95% of Parents Saving for Kids’ College Expenses Expect to Cover Over Half the Costs, According to Northwestern Mutual Planning & Progress Study 2 in 3 parents who are helping their kids cover college costs expect their children to pay for part of the educational expenses; 1 in 3 say the parents will pay for … [Read more…]
Getting into gold coin investing can be a smart move for anyone looking to add some shine to their financial strategy. In this guide, we’ll give you the lowdown on different types of gold coins, how to figure out what they’re really worth, and tips for keeping your investment safe and sound.
You’ll also get the inside scoop on dealer markups, how to make sure you can cash out when you need to, and the steps to check that your coins are the real deal. Ultimately, we want to empower you with the knowledge to make informed decisions and enhance your investment portfolio with the timeless appeal of gold coins.
Key Takeaways
Gold coins offer investment diversity, with bullion coins being tied to gold content and purity, numismatic coins prized for their rarity and design, and semi-numismatic coins providing both gold value and collectible interest.
Key factors in gold coin investment include understanding premiums over spot price, ensuring liquidity and ease of resale, and selecting appropriate storage options to safeguard the investment.
Investing in gold coins entails choosing reputable dealers to prevent counterfeit risks, understanding tax implications like capital gains, and considering gold coins as a way to diversify and hedge against inflation within an investment portfolio.
The Fundamentals of Investing in Gold Coins
Gold coins, with their gleaming allure and historical significance, offer investors a tangible asset that stands the test of time. They come in various forms, each bearing unique characteristics and investment potential.
From bullion coins valued for their gold content and purity to collectible gold coins prized for their rarity and historical significance, the world of gold coins is as diverse as it is fascinating. As a form of precious metals, these coins, along with silver coins, provide a sense of security and value for investors.
Bullion Coins
Bullion coins, including bullion gold coins, are the go-to choice for those seeking straightforward exposure to gold. Valued based on their gold content and purity rather than historical and artistic considerations, a bullion coin like the Canadian Maple Leaf and American Gold Buffalo offers a direct link to the global gold market. For those interested in other forms of investment, gold bars can also be considered.
Numismatic Coins
For the history buffs and collectors, numismatic coins offer a unique allure. These coins are valued not just for their gold content, but also for their rarity, historical significance, and the artistry of their designs. Their value is less tethered to the spot price of gold, making them less susceptible to short-term market fluctuations.
Semi-Numismatic Coins
Straddling the line between bullion and numismatic coins are semi-numismatic coins. These coins offer both the gold value of bullion coins and the collectible appeal of numismatic coins. Their versatility makes them an attractive choice for a range of investors, from those seeking a straightforward gold investment to collectors looking for unique assets.
Top Gold Coin Options for Investors
There are a wide variety of gold coins to choose from, which can be overwhelming for new investors. However, some standout choices have captured the attention of investors worldwide. Let’s examine three popular gold coin options: the American Gold Eagle, the Canadian Gold Maple Leaf, and the South African Krugerrand.
American Gold Eagle
The American Gold Eagle coin, prominently displaying Lady Liberty and an American bald eagle, not only represents American heritage and freedom but also stands as a testament to the nation’s robust minting capabilities.
Introduced in 1986, these coins are struck in 22-karat gold, which includes a small alloy of copper and silver to ensure durability. Their availability in multiple denominations—1 oz, 1/2 oz, 1/4 oz, and 1/10 oz—makes them accessible to a wide range of investors, from those starting out to seasoned collectors. The blend of historical significance and investment flexibility has cemented their status as a favored option in precious metals markets.
Canadian Gold Maple Leaf
Produced by the Royal Canadian Mint, the Canadian Gold Maple Leaf is globally acclaimed for its .9999 fine gold purity, one of the highest in the market. Launched in 1979, this coin features the sugar maple leaf, a national symbol of Canada, which underscores the country’s appreciation of its natural environment and cultural heritage.
Its cutting-edge security features, like light diffracting patterns of radial lines and micro-engraved laser marks, ensure its authenticity and protect investors. The coin’s combination of high gold content and stunning design makes it not only a secure investment but also a collector’s delight.
South African Krugerrand
The South African Krugerrand is renowned for being the first gold bullion coin available to the general public, introduced in 1967 to help market South African gold. Named after the 19th-century Boer leader and the rand, the national currency, this coin features the image of Paul Kruger on one side and the Springbok gazelle on the other, celebrating South Africa’s rich wildlife and cultural heritage.
Unlike many other gold coins, the Krugerrand is minted from a gold alloy that is 22 karats, or 91.67% gold, with the remainder being copper, giving it a distinctive, more durable rose tint. This combination of affordability, durability, and cultural symbolism makes it a staple in the global gold trade, appealing to both investors and collectors alike.
Factors to Consider When Investing in Gold Coins
Investing in gold coins doesn’t just stop at choosing the right coin. It’s also about understanding the inherent factors that come with it. Let’s explore these key factors: premiums over spot price, liquidity, and storage options.
Premiums and Spot Price
While the spot price of gold is a key factor in determining the price of a gold coin, it’s not the only cost to consider. Premiums over the spot price can significantly impact the overall investment returns. Therefore, it’s essential to understand how premiums work and to be mindful of market trends.
Liquidity and Ease of Sale
One of the key advantages of gold coins is their liquidity. Gold coins are recognized worldwide and can generally be sold in any volume. However, the ease of sale can vary depending on the specific coin and market conditions.
Storage Options
Once you’ve invested in gold coins, you need a safe place to store them. Storage options range from home safes to professional vaulting services. Each comes with its own advantages and costs, and choosing the right one is crucial to the security of your investment.
How to Buy Gold Coins Safely and Securely
Investing in gold coins requires careful planning and vigilance. From choosing a reputable dealer to avoiding counterfeit coins and inspecting your purchase upon delivery, let’s explore how to buy gold coins safely and securely.
Choosing a Reputable Dealer
Purchasing gold coins from a well-established dealer is the first step towards a secure investment. A reputable dealer provides high-quality coins and offers invaluable customer support and guidance.
Avoiding Counterfeit Coins
Counterfeit coins pose a significant risk to investors. It’s crucial to understand how to identify counterfeit coins and ensure the authenticity of your purchase. From requesting documentation to conducting physical tests, vigilance is the key to safeguarding your investment.
Delivery and Inspection
The final step of your gold coin purchase is the delivery and inspection of your coins. Upon delivery, be sure to promptly inspect your gold coins to ensure they meet quality and authenticity standards.
Tax Implications and Legal Considerations
Like all investments, gold coins come with their own set of tax implications and legal considerations. From capital gains tax to reporting requirements, it’s crucial to understand these aspects to avoid legal complications and ensure a smooth investment journey.
Capital Gains Tax
Profits from the sale of gold coins are subject to capital gains tax. The rate of this tax can vary depending on the holding period of the coins and the investor’s income level. It’s essential to understand these rates and plan your investments accordingly.
Reporting Requirements
Certain gold coin transactions may be subject to reporting requirements. Be prepared to declare your holdings when necessary and ensure you comply with all applicable regulations.
Legal Ownership
Maintaining accurate records of transactions and ownership is crucial when investing in gold coins. These records not only help establish legal ownership, but are also essential for proper tax reporting.
Diversifying Your Investment Portfolio with Gold Coins
Bringing gold coins into your investment portfolio can add a unique layer of diversification. They can hedge against inflation, balance risk with other investments, and open up opportunities for both long-term and short-term investment strategies.
Hedging Against Inflation
In times of economic uncertainty, physical gold, particularly gold coins, can serve as a protective hedge against inflation. As the cost of living rises, gold coins can help maintain the value of your investment portfolio, safeguarding your purchasing power.
Balancing Risk with Other Investments
Including gold coins in your investment portfolio can help balance risk. The value of gold coins often moves inversely to other asset classes like stocks and bonds, providing a buffer against market volatility.
Long-Term vs. Short-Term Investment Strategies
Whether you’re looking for a long-term investment to weather market fluctuations or a short-term investment influenced by temporary market trends, gold coins can be a fit for your gold investing strategy, making them a viable option for gold investments.
The choice depends on your financial objectives and risk tolerance.
Bottom Line
Investing in gold coins can be a rewarding journey. From understanding the basics to navigating tax implications and legal considerations, it’s a path filled with learning and potential growth. As you progress, remember the importance of diligence, careful planning, and informed decision-making. With the right approach, you can unlock the golden opportunities that await in gold coin investing.
Frequently Asked Questions
How do I determine the authenticity of gold coins?
The authenticity of gold coins can be verified through several methods, including checking for hallmarks, weight and size measurements, and performing sound and magnetism tests. Purchasing from reputable dealers and considering third-party grading and certification can also ensure authenticity.
Can I purchase gold coins from banks?
Some banks do offer gold coins for sale, but availability can vary widely depending on the bank and the country. It’s often more common to purchase gold coins from specialized bullion dealers, coin shops, or online marketplaces.
How does the price of gold affect gold coin values?
The value of gold bullion coins is closely tied to the current market price of gold, known as the spot price. As the price of gold fluctuates, so does the value of gold coins. Numismatic and semi-numismatic coins may also be affected by gold prices, but their value is more influenced by rarity, condition, and historical significance.
Are gold coins a good option for short-term investments?
Gold coins can be a good option for short-term investments if you are knowledgeable about the gold market and current economic conditions. However, due to the premiums over the spot price and potential market volatility, gold coins are generally considered a more stable long-term investment.
How do I store and insure my gold coin collection?
Gold coins should be stored in a secure location, such as a safe deposit box at a bank or a home safe. For insurance, you can add a rider to your homeowner’s insurance policy or obtain a separate policy specifically for valuable items like gold coins. Ensure that your insurance policy covers the full value of your collection.
What impact do market conditions have on gold coin investing?
Market conditions can significantly impact gold coin investing. Economic uncertainty, inflation, and currency devaluation typically increase demand for gold, potentially raising gold coin prices. Conversely, a strong economy might lead to less demand for gold as an investment.
Is it better to invest in gold coins or gold bars?
The choice between investing in gold coins or gold bars depends on your investment goals. Coins are better for those interested in collectability and legal tender value, while bars typically have lower premiums over spot price and may be preferable for those focusing purely on the gold content and investment.
How do I sell my gold coins when I want to cash out?
To sell your gold coins, you can approach coin dealers, precious metal exchanges, online marketplaces, or auction houses. It’s important to research the current gold price and get multiple quotes to ensure you receive a fair price for your coins.
Representative French Hill, a Republican from Arkansas, sits on the House Financial Services Committee.
Al Drago/Bloomberg
WASHINGTON — Rep. French Hill, R-Ark., the vice chairman of the House Financial Services Committee, criticized a range of proposals by Biden administration regulators, notably those related to technology, including bank-fintech partnerships and digital assets, in a speech Tuesday.
Hill, who also serves as the chairman of the House Financial Services subcommittee on digital assets and is in the running to take the top Republican spot on the full committee next Congress, told a room full of community bankers that his and other House Republicans’ focus for the remainder of the Biden administration is pushing back on regulators’ policies, as well as introducing some legislation to “lead us in the right direction.” He spoke at a conference organized by the Independent Community Bankers of America.
In particular, Hill criticized a move by the Federal Reserve in August that outlined how the central bank would oversee “novel activities,” including technology-driven partnerships with nonbanks, and activities that include cryptocurrencies and blockchain technology.
Hill and many other Republicans interpret steps being taken by banking regulators to address fintech and crypto policy as effectively shutting out banks from those businesses.
Hill argued that the Fed’s action in August “basically says that if you want to partner with a fintech company in any aspect of your business, somebody has to get preapproval for that.’
“I told Vice Chairman [Michael] Barr, that’s not the way we work in banking,” he added.
Hill said that regulators should instead look at these partnerships and activities at banks individually through the examination process.
“We have records, we have risk management policies and compliance departments,” he said. “We document all that, then we’ll go over it with an exam. I thought that was a serious overreach.”
Hill said that one of his goals in the next year is to show regulators and Congress that fintech “can benefit banks.” He’s also interested in the use of artificial intelligence in the financial sector.
“We’re bringing in the regulators, asking them how they’re using AI in their own practice and their own services to you, and how they’re looking at AI from a supervisory perspective,” he said.
Hill also referenced an off-the-record session at the ICBA conference the previous day with Consumer Financial Protection Bureau Director Rohit Chopra. Hill, like other congressional Republicans, has repeatedly criticized Chopra’s rulemakings and enforcement actions.
“I don’t think any CFPB director has ever made a small business loan,” Hill said. “You got to hear from one of the slickest guys in town yesterday.”
Hill promised to continue pushing back on the CFPB’s small-business lending data collection rule, which has faced litigation from the banking industry as well as an ultimately unsuccessful Congressional Review Act challenge.
Inside: Uncover the realities of financial aid repayment for students. Learn about FAFSA, loan forgiveness, credit impacts, and strategies for managing your student debt. Find out which types of debt you must pay back.
Financial aid is a beacon of hope for many aspiring students, granting them the financial support they need to access higher education.
Yet, understanding the basics of FAFSA makes applying for financial aid confusing for most students. When considering aid options, it’s crucial to differentiate between the various available types.
Navigating your repayment obligations can seem daunting, but with proactive management, they needn’t be overwhelming.
Take stock of your financial aid package and parse out which portions require repayment.
Understanding these details is the first step towards fulfilling your obligations without compromising your financial well-being.
Remember to read the fine print and don’t hesitate to reach out to your loan servicer for clarification. They are there to help guide you through the repayment process.
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.
Do you have to pay back FAFSA money?
Technically, FAFSA indicates how much financial aid you can qualify for. Whether you need to repay depends on the type of financial aid you received:
Grants and scholarships: These forms of aid do not require repayment.
Work-Study: These funds are earned through part-time work and do not require repayment.
Loans (subsidized, unsubsidized, and Direct Plus Loans): These must be repaid with interest.
It’s important to note that while grants typically don’t have to be paid back, certain circumstances, such as withdrawal from a program or changes in enrollment status, may require you to repay federal grant money.
Start filling out your FASFA properly with these tips.
Do you have to pay scholarships back?
When it comes to scholarships, the name of the game is financial support without the strings of repayment. Generally, scholarships are like gifts—they do not have to be paid back. Perfect for the undergraduate!
Scholarships are awarded for various reasons such as academic excellence, artistic or athletic talent, or involvement in community service, among others. That said, it’s imperative to understand the terms set by the scholarship provider.
Most scholarships are commitment-free, but some may carry conditions such as maintaining a certain GPA, completing a degree in a specified field, or requiring the recipient to follow through with certain obligations. If these conditions are not met, there could be repercussions, including the requirement to repay the funds.
Learn how to pay for college without loans.
Types of Financial Aid That Require Repayment
I’m not going to lie when I was looking at borrowing for financial aid for college I was confused with the names and types of aid offered. Now, I know the best course of action is to get paid to go to school.
Thankfully, there is more information readily available for this type of information rather than relying on your guidance counselor.
So, here is the info you need.
Unraveling Federal Student Loan Repayment
First, you must understand the different types of Federal Student loans to know their repayment requirements.
Each loan type has its own set of rules and repayment schedule, typically beginning after you graduate, leave school, or drop below half-time enrollment.
Federal loans boast flexible repayment options.1
The Standard Repayment Plan for federal loans entails a fixed monthly payment amount, ensuring that the loans are fully repaid within a standard period of 10 years, and extends to 30 years for direct consolidation loans. This plan is often the quickest way to pay off loans, providing a consistent monthly payment over the repayment term.
The Graduated Repayment Plan starts with lower monthly payments that increase every two years, designed to pay off all student loans within 10 years, or 30 years if it’s a direct consolidation loan.
The Extended Repayment Plan offers borrowers with over $30,000 in federal student loans the flexibility of fixed or graduated payments over a 25-year period.
If affordability is a concern, you might settle on an income-driven repayment (IDR) plan, which keys your monthly payments to your earnings and family size. Should your finances take a downward turn, relief is available through programs like deferment or forbearance, allowing you to temporarily suspend payments.
After 20 to 25 years on an IDR plan, you might even be eligible for loan forgiveness for any remaining balance. This doesn’t nullify your entire debt but can relieve a significant financial burden. Teacher Loan Forgiveness and Public Service Loan Forgiveness (PSLF) are two such avenues, provided eligibility requirements are met.
Deciphering Private Student Loan Responsibility
These private loans are offered by non-government entities such as banks, credit unions, and online lenders, and repayment rules can be more stringent. As such, it is best to start with traditional federal loans.
While you typically aren’t required to repay private student loans while you’re in school, interest accrues during this time, increasing your eventual debt. After leaving school, some lenders allow a grace period similar to federal loans, but this isn’t guaranteed. Check with your lender for specifics on repayment commencement and grace periods.
Repayment plans with private loans are usually less flexible and often lack income-driven options. Monthly payments are fixed, and lender offerings on deferment and forbearance can be less generous, with some providing no options for such measures.
This is why it is best to learn how to pay for college without parents’ help.
Scholarship System
The Scholarship System is changing how parents and students look at paying for college.
Learn how real people found real scholarships. Their students have been awarded $12,060,000 in scholarship money (as of October 2023).
Join the Free Training
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When You Need to Start Paying Back Financial Aid
Federal Loans: Grace Periods and Repayment Plans
Federal student loans, notably, offer a six-month grace period following graduation, leaving school, or dropping below half-time enrollment status. During this period, no payments are due, offering you time to get financially settled and choose a repayment plan.
Repayment plans span the Standard, where you’ll pay a fixed amount each month for a term of usually ten years, to Graduated, where payments start lower and increase over time. Income-Driven Repayment Plans adapt to your income level, ensuring that your student loan payments are manageable relative to your earnings.
Each plan has unique advantages depending on your financial situation and long-term goals. The key is to select one that corresponds with your ability to pay, aligns with your career trajectory, and manages your debt effectively over time.
Always be proactive in contacting your loan servicer to discuss plan options or changes in your financial status.
Private Loans: Lender-Specific Timelines and Terms
Private loans come with lender-specific timelines and terms that can vary widely from one lender to another. Unlike federal loans, private loans don’t come with a standardized grace period, although some lenders may offer a similar post-graduation moratorium on payments.
Borrowers must check their loan agreements to determine when repayment should begin.
The terms of repayment for private loans are also set by the lender and typically don’t offer the same flexibility found in federal programs. Fixed and variable interest rates are based on credit scores, and while some lenders might offer loan modification options in cases of financial hardship, such policies are not universal.
Remember, with private loans, leniency for late or missed payments is not a given.
Consequences of Defaulting on Financial Aid
The Effects on Credit Scores and Future Borrowing
Missing payments, or worse, defaulting on your student loans, are red flags to future creditors that appear on credit reports and can significantly lower your credit score. A lower score can make securing further credit from lenders—whether it’s for a mortgage, a car loan, or a credit card—an uphill battle.
Moreover, the repercussions ripple outward: Not only might you face higher interest rates due to perceived risk, but landlords and employers can reference credit scores during their tenant or employment screening processes.
Maintaining on-time payments is an investment not only in your education but also in your broader financial stability and opportunities.
Legal Repercussions and Wage Garnishment Risks
Wading into the murky waters of default on student loans can unleash legal repercussions that ripple through your financial landscape. The government has tough mechanisms to recoup defaulted federal student loans, ranging from wage garnishment — where a portion of your paycheck is allocated to your debt without your consent — to seizing tax refunds and other federal benefits you may be entitled to receive.
The prospect of wage garnishment adds a level of complication to an already tense situation. In such cases, the government can legally claim up to 15% of your disposable income. This can strain your finances even more, potentially forcing you to make hard choices about your monthly budget.
These same consequences do not typically apply to private student loans, which are subject to state laws. However, private lenders can bring lawsuits against borrowers in default, leading to potential wage garnishment or asset liquidation as decided by a court.
The message is stern yet simple: Stay vigilant with student loan repayments to forestall these severe outcomes.
Options for Managing Repayment Challenges
Loan Forgiveness, Cancellation, and Discharge Opportunities
Navigating the sea of student loan debt isn’t without its lifelines. Loan forgiveness, cancellation, and discharge programs can serve as financial floatation devices, providing necessary relief in an ocean of repayment.
Loan forgiveness is typically occupation-specific. For instance, Public Service Loan Forgiveness (PSLF) absolves remaining federal loan debt after 120 qualifying payments for professionals in government or non-profit sectors.
Cancellation might occur under circumstances like your school closing prematurely or if you’ve been defrauded by the institution.2
Additionally, if you become totally and permanently disabled, you may qualify for a discharge, relieving you from the obligation to repay your federal student loans.
Exploring these opportunities requires patience and diligence, as each comes with strict eligibility criteria. Nonetheless, they can significantly lighten the burden of student debt.
Strategies for Keeping Student Loan Payments Affordable
Crafting a strategy to keep student loan payments within the realm of affordability hinges on exploring all available options and making informed choices. Consider the following ways to ensure your loans remain manageable:
Income-Driven Repayment Plans: Federal loans offer several plans that base your monthly payment on your income, notably capping payments at a fixed percentage of your discretionary income. These plans can significantly decrease your monthly obligations if you’re starting with a lower salary.
Refinancing or Consolidation: You might find a lower interest rate through refinancing, which can reduce your monthly payments and the total cost over the life of the loan. Consolidating multiple federal loans can streamline payment processes, though it may average out to a higher overall interest rate. This is what I did.
Applying for Deferment or Forbearance: In times of financial hardship, job loss, or returning to school, you can apply for a temporary suspension of payments. While interest may still accrue, it can provide short-term relief.
Making Extra Payments: By paying more than the minimum or making bi-weekly payments, you can reduce the principal balance faster and save on interest in the long run.
Setting a Budget and Cutting Expenses: Sometimes, the most effective strategy is tightening your budget. By trimming unnecessary expenses, you may free up funds for your loan payments.
Every borrower’s situation is unique, so consider your financial circumstances and long-term goals when choosing the best strategy for you. Always maintain open communication with your loan servicer to stay abreast of changes or additional assistance programs that may become available.
Should I refinance my Student Loans?
Refinancing your student loans can be a strategic move to manage debt, potentially offering lower interest rates and different repayment terms to suit your financial situation. It involves replacing your current loan with a new one, typically through a private lender, and may provide relief if you’re struggling with high payments.
However, borrowers should carefully consider the loss of federal loan benefits, like loan forgiveness, before proceeding with refinancing their student loans.
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Making Informed Financial Aid Decisions – How to Review and Understand Your Aid Offer
When the much-anticipated financial aid offer lands in your hands, taking the time to thoroughly review and understand it ensures you’re making an informed decision. Here’s how you can break down your aid package:
Identify Free Money: Distinguish between grants and scholarships that don’t require repayment from loans that do. These are the parts of your offer that you’ll want to maximize.
Assess Work-Study Opportunities: If your offer includes federal work-study, understand that these funds must be earned and are not guaranteed. They depend on your finding an eligible job and fulfilling work hours.
Analyze Loan Details: Look closely at the type of loans offered, their interest rates, and repayment terms. Remember, federal loans generally offer more favorable terms than private loans.
Calculate Net Cost: Subtract the total aid package, excluding work-study, from the overall cost of attendance to determine what you’ll need to cover through savings, income, or additional loans.
Consider Cost of Living: Ensure that you take into account living expenses and indirect costs like books and supplies when reviewing your aid offer.
If anything is unclear, don’t hesitate to contact the school’s financial aid office for clarification. The goal is to fully understand your commitments before accepting any part of the aid offer.
Remember Not All Financial Aid Offers Must Be Accepted
Not every portion of the financial aid offered to a student needs to be accepted.
It’s crucial to carefully evaluate the components of the financial aid package, as some elements, such as loans, will need to be repaid with interest. Ultimately, it’s important to make informed decisions about which types of aid to accept based on one’s financial circumstances and long-term educational costs.
Frequently Asked Questions (FAQ)
FAFSA, the Free Application for Federal Student Aid, is a form that determines your eligibility for different types of financial aid, not money in itself.
Some aid offered via FAFSA does not need to be repaid, like grants and scholarships, while other types, such as federal student loans, do require repayment with interest.
If you withdraw from college, your student loans remain in place and need repayment.
Following withdrawal, usually a six-month grace period for federal loans before repayments start. However, interest may accrue during this time, except for subsidized federal loans, which don’t accumulate interest until after the grace period.
Yes, FAFSA loan debt, which generally refers to federal student loans obtained through the FAFSA application process, can be forgiven, canceled, or discharged under certain conditions, such as public service work, teaching in low-income areas, or permanent disability.
However, these options have specific eligibility requirements. So, be careful and read the fine print.
If you don’t pay back financial aid that is in the form of a loan, you risk defaulting, which can lead to wage garnishment, withheld tax refunds, lowered credit score, and other financial consequences.
It can make future borrowing more difficult and become a legal issue. Always seek help before defaulting.
What Happens If You Don’t Pay Back the Financial Aid?
If you don’t pay back financial aid that is in the form of a loan, you risk defaulting, which can lead to wage garnishment, withheld tax refunds, lowered credit score, and other financial consequences.
It can make future borrowing more difficult and become a legal issue. Always seek help before defaulting.
Source
Federal Student Aid. “Federal Student Loan Repayment Plans.” https://studentaid.gov/manage-loans/repayment/plans. April 28, 2024.
Student Loan Borrower Assistance. “Borrower Defense to Repayment.” https://studentloanborrowerassistance.org/for-borrowers/dealing-with-student-loan-debt/loan-cancellation-forgiveness-bankruptcy/cancellation-forgiveness-options/borrower-defense-to-repayment/. April 28, 2024.
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Net asset value (NAV) is an important metric for knowing how much each share of an investment fund, like a mutual fund or ETF, is worth. However, NAV alone cannot tell investors everything they need to know about potential investments.
Calculating NAV is helpful for fund valuation and pricing. Still, there are times when it is more beneficial to look at other aspects of a fund, like total return, to determine investment opportunities. Nonetheless, investors need to know how to calculate NAV, when it makes sense to use it, and why.
What Is Net Asset Value (NAV)?
Net asset value, or NAV, represents the value of an investment fund. NAV, most simply, is calculated by adding up what a fund owns (the assets) and subtracting what it owes (the liabilities).
NAV is typically used to represent the value of the fund per share, however, so the total above is usually divided by the number of outstanding shares. This makes it easier for investors to value and price the shares of a fund. Mutual funds, for example, use per-share NAV to determine their share price.
The NAV will also change daily because an investment fund’s assets and liabilities change daily based on market prices.The assets of an investment fund include the daily market value of the fund’s holdings, which are usually securities like stocks and bonds. The liabilities of a fund are usually debts owed to financial institutions and expenses, like salaries, operating costs, and other fees.
The Securities and Exchange Commission (SEC) requires that mutual funds calculate their NAV at least once each business day. Most mutual funds perform their calculations after the major U.S. securities exchanges close for the day.
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NAV Formula
Net asset value, as mentioned above, is calculated by taking a company or investment fund’s total assets and subtracting its liabilities. This figure is usually divided by the fund’s number of outstanding shares because NAV is generally represented on a per-share basis. The formula looks like this:
NAV = (Total Value of Assets – Total Value of Liabilities) / Number of Shares Outstanding
How NAV Is Used for Investments
NAV can be used for investments, and by investors, in a number of ways, often depending on the specific type of asset an investor is analyzing. It can give investors insight into a fund’s performance, but doesn’t necessarily tell the whole story.
Mutual Funds
Mutual funds are usually open-ended funds, meaning that investors buy and sell shares of the fund from the fund directly and not on an exchange like a stock. Because these funds don’t trade on an exchange for market prices, NAV is used to price the fund’s shares.
Mutual funds calculate their NAV per share daily, usually at the end of the business day, and that is the price an investor will pay to buy or sell shares in the fund. Every mutual fund company has its own cut-off time for buying and selling shares. After that time, investors buying or selling shares will get the fund’s NAV for the day after their transaction order is received.
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ETFs
Exchange-traded funds (ETFs) and closed-end funds are similar to traditional mutual funds, but one big difference is that investors can buy and sell ETFs throughout the trading day for a market price and not the NAV per share. Investors can make buy and sell orders for traditional mutual funds once per day and only at their published NAVs.
ETFs are still required to calculate the fund’s NAV once per day, like a mutual fund. Additionally, an ETF’s NAV is calculated approximately every 15 seconds over each trading day and published on various financial websites.
Because ETFs tend to trade at a premium or a discount to their NAV, traders often compare market prices and NAV to take advantage of the differences and make investment decisions.
Example of Calculating Mutual Fund NAV
As an example of calculating mutual fund NAV, imagine that mutual fund XYZ has $100 million worth of investments in different securities, based on the day’s closing prices for each security, and $10 million in liabilities and expenses. The NAV for this fund would be $90 million. If the fund has 5 million shares outstanding, the NAV per share for mutual fund XYZ would be $18.
The NAV for mutual fund XYZ can be calculated using the above formula:
NAV = ($100,000,000 – $10,000,000) / 5,000,000 = $18
How to Interpret NAV Results
A fund’s NAV alone doesn’t tell investors much; a high NAV for one fund is not necessarily better than a low NAV in another fund. Similar to stock prices, a high stock price doesn’t necessarily mean the stock is a better investment than a stock with a lower price.
Looking at a fund’s NAV and comparing it to another fund does not provide investors insight into which fund is the better investment. It’s more important for investors to look at NAV alongside other factors, like the fund’s past performance, the allocation of securities within each fund, and how it performs compared to benchmark indices like the S&P 500 Index.
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Why Do NAVs Change?
A mutual fund’s NAV will likely change every trading day because the prices of securities in which the fund invests are likely to change every trading day, affecting the total assets in the fund. It’s also because the number of outstanding shares held by investors often changes daily, as new investors buy shares and existing investors sell.
Other factors can also impact a fund’s NAV. For example, the fund’s management fee and additional fees that add up to the fund’s total expense ratio will come out of the fund’s total assets, thus affecting NAV. In addition to management fees, expenses can include costs related to the administrative, compliance, distribution, management, marketing, shareholder services, and record-keeping of the fund. It’s common practice for mutual funds to assess this debit on the fund’s assets every trading day.
When NAV Isn’t Everything
If a mutual fund invests in dividend-paying stocks or fixed-income assets, these securities’ dividends and interest payments go to the investor. Additionally, a mutual fund may distribute realized capital gains to shareholders. These payouts reduce the fund’s assets and result in a lower NAV. Because these benefits lower a fund’s NAV, it shows that NAV may not be the only figure to pay attention to when analyzing the performance of a fund.
When analyzing the performance of mutual funds, it can make sense to look at metrics other than NAV alone, like investment yield and the funds’ total return. The total return considers capital gains and losses from all of the securities the fund invests in, as well as the dividends and interest earned by the fund, minus the fund’s expenses.
The Takeaway
Net asset value, or NAV, is a daily calculation that can track the value of a mutual fund, ETF, or money market fund. But while this figure can be helpful to gauge a fund’s performance, it isn’t the only metric that investors should consider. Total return, yield, and fees are also important figures when making mutual fund investing decisions.
Remember that NAV itself doesn’t tell an investor everything that they need to know, but is just one metric or data point that can be used along with an array of others to analyze funds.
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FAQ
Is net asset value the same as price?
NAV and share price are two different things. Net asset value is the value of the investments within a fund, or the value of a portion of the fund. The share price of a fund, though it may be related, is different from that value.
Why is net asset value important?
Net asset value is important for investors because it describes the total equity or value of a fund. It can help determine the value a share of a fund has, and can help investors evaluate the overall value of an investment.
Is high NAV good or bad?
NAV on its own doesn’t tell investors a whole lot, so whether NAV is high may not be good or bad. What’s more important is how high a fund’s NAV is relative to other metrics, which may include its market price.
Is it good to invest when NAV is down?
If a fund’s NAV is down, that could be a sign that the fund’s performance is suffering. But it doesn’t necessarily mean that it’s a good time to invest in that fund, or a bad time to do so – other metrics must be considered along with NAV, at any given time, to determine whether an investor wants to alter their position.
What is an example of a NAV?
An example of NAV could be $18, and that would be calculated looking at a fund’s underlying securities. You’d need to rope in assets and liabilities, and calculate accordingly to find NAV. Again, $18 is just an example, as NAV could be any dollar figure as it relates to the fund’s assets and liabilities.
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The average rate on a 30-year fixed mortgage is 7.70%, and on a 15-year fixed-rate mortgage, it’s 6.96%. The average rate on a 30-year jumbo mortgage is 7.72%.
*Data accurate as of April 26, 2024, the latest data available.
30-year fixed mortgage rates
The average mortgage rate for 30-year fixed loans rose today to 7.70% from 7.65% last week, according to data from Curinos. This is up from last month’s 7.30% and up from a year ago when it was 5.95%.
At the current 30-year fixed rate, you’ll pay about $712 each month for every $100,000 you borrow — up from about $710 last week.
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15-year fixed mortgage rates
The mortgage rates for 15-year fixed loans inched up today to 6.96% from 6.89% last week. Today’s rate is up from last month’s 6.53% and up from a year ago when it was 5.35%.
At the current 15-year fixed rate, you’ll pay about $895 each month for every $100,000 you borrow, up from about $894 last week.
30-year jumbo mortgage rates
The mortgage rates for 30-year jumbo loans rose today to 7.72% from 7.42% last week. This is up from last month’s 7.25% and up from 5.79% last year.
At the current 30-year jumbo rate, you’ll pay around $712 each month for every $100,000 you borrow, up from about $707 last week.
Methodology
To determine average mortgage rates, Curinos uses a standardized set of parameters. For conventional mortgages, the calculations are based on an owner-occupied, one-unit property with a loan amount of $350,000. For jumbo mortgages, the loan amount is $766,550. These calculations assume an 80% loan-to-value ratio, a credit score of 740 or higher and a 60-day lock period.
Frequently asked questions (FAQs)
On May 3, 2023, the Federal Reserve announced a third interest rate hike for the year — this time by 25 basis points. While the Fed doesn’t set mortgage rates, this increase in the federal funds rate could lead individual lenders to raise their home loan rates, too.
If you already have a mortgage, how this could affect your monthly payment will depend on if your loan has a fixed or adjustable rate. A fixed rate stays the same over the life of the loan, meaning your payments will never change. An adjustable rate, however, can fluctuate according to market conditions — which means you could see a rise in your monthly payments.
For example, if you take out an ARM for $250,000 with an interest rate of 5.5%, your initial monthly payments would be $1,719. But after the initial period is over, and the ARM switches to a variable rate, your payments could increase if the rate rises. If the rate rose just 25 basis points (5.75%), for instance, your payments would increase to $1,750.
If you’re not planning on keeping a home for a long time, an ARM could be the better option — especially if fixed-rate loans have much higher rates at the time. This is because ARMs tend to have lower rates to start than fixed-rate mortgages, though your rate can increase over time.
While a fixed-rate loan will have the same rate throughout the entire term, an ARM will start with a fixed rate for a set amount of time and then switch to a variable rate that can change for the remainder of your loan term. For example, a 5/1 ARM will have a fixed rate for five years (the “5” in 5/1), then switch to a variable rate that can change once a year (the “1” in 5/1).
Whether a mortgage rate buydown is the right choice for you will depend on your individual circumstances and financial goals. If you plan to stay in the home for a long period of time and can afford to pay for the buydown, it could make sense. But if you know you’ll move or refinance your mortgage before you break even on the cost of the buydown versus the lower monthly payments, then buying down your rate might not be worth it.
Buying down your rate can be permanent or temporary, which will impact the overall cost. A permanent buydown is also known as purchasing mortgage discount points — for each point, you’ll typically pay 1% of the loan amount in return for 0.25% off your rate.
Temporary buydowns, on the other hand, will reduce your interest rate to a certain point, and it will then increase each year until you hit the original rate. Some common temporary options are 2-1 and 1-0 terms, with the first number being how much your rate is reduced in the first year and the second number being the reduction for the following year. Unlike discount points that are paid for by the buyer, this type of buydown can be paid for by the lender, seller or homebuilder.
Blueprint is an independent publisher and comparison service, not an investment advisor. The information provided is for educational purposes only and we encourage you to seek personalized advice from qualified professionals regarding specific financial decisions. Past performance is not indicative of future results.
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Jamie Young is Lead Editor of loans and mortgages at USA TODAY Blueprint. She has been writing and editing professionally for 12 years. Previously, she worked for Forbes Advisor, Credible, LendingTree, Student Loan Hero, and GOBankingRates. Her work has also appeared on some of the best-known media outlets including Yahoo, Fox Business, Time, CBS News, AOL, MSN, and more. Jamie is passionate about finance, technology, and the Oxford comma. In her free time, she likes to game, play with her two crazy cats (Detective Snoop and his girl Friday), and try to keep up with her ever-growing plant collection.
Megan Horner is editorial director at USA TODAY Blueprint. She has over 10 years of experience in online publishing, mostly focused on credit cards and banking. Previously, she was the head of publishing at Finder.com where she led the team to publish personal finance content on credit cards, banking, loans, mortgages and more. Prior to that, she was an editor at Credit Karma. Megan has been featured in CreditCards.com, American Banker, Lifehacker and news broadcasts across the country. She has a bachelor’s degree in English and editing.
Ashley Harrison is a USA TODAY Blueprint loans and mortgages deputy editor who has worked in the online finance space since 2017. She’s passionate about creating helpful content that makes complicated financial topics easy to understand. She has previously worked at Forbes Advisor, Credible, LendingTree and Student Loan Hero. Her work has appeared on Fox Business and Yahoo. Ashley is also an artist and massive horror fan who had her short story “The Box” produced by the award-winning NoSleep Podcast. In her free time, she likes to draw, play video games, and hang out with her black cats, Salem and Binx.