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Apache is functioning normally

August 20, 2024 by Brett Tams

You may think of a bank as simply a safe place to put your money. But banks do a lot more than accept deposits. They also extend loans, facilitate payments, exchange currency, set monetary policy, and provide a range of other financial services to individuals, businesses, and governments. Here are key things to know about banks, including how they work, how they make money, and the different products and services they offer.

What Is a Bank?

By definition, a bank is an institution that accepts deposits in checking and savings accounts and makes loans. In serving both functions, banks act as intermediaries between depositors (who essentially lend money to the bank) and borrowers (to whom the bank lends money). The money the bank pays to depositors and charges on loans is called interest.

Banks also offer a range of other financial products and services, including:

• Credit cards

• Investment accounts

• Wealth management services

• Individual retirement accounts (IRAs)

• High-yield savings accounts

• Certificates of deposit (CDs)

• Money market accounts

• Currency exchange

• Safe deposit boxes

Banks also facilitate payments — from employers to employees, buyers to sellers, and taxpayers to the government — and play a major role in the nation’s economy. There are also many different types of banks, including retail banks, corporate banks, and central banks.

How Do Banks Make Money?

Banks typically generate revenue through a variety of channels. These include:

• Interest on loans: Banks lend money to individuals and businesses at higher interest rates than what they pay on deposits, earning the interest rate spread.

• Fees: Banks may charge fees for various services, including account maintenance, overdrafts, wire transfers, and out-of-network ATM usage.

• Investment income: Banks may invest in securities, bonds, and other financial instruments, earning returns on these investments.

• Interchange fees: When customers use their debit or credit cards, banks earn fees from merchants processing the transactions.

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A Brief History of Banks

The concept of banking dates back to ancient civilizations, when temples were used as safe places to store valuable items and grain, and priests would lend these resources to local farmers and merchants. The temples were also responsible for keeping records of these transactions, laying the groundwork for bookkeeping.

The first modern banks emerged in Renaissance Italy, with institutions like the Medici Bank setting the standard for banking operations. Over centuries, banks evolved, expanding their products and services and adopting technological advancements to meet the growing demands of consumers and businesses. Today, banks are integral to the global economy.

Modern Bank Products for Consumers

Modern banks offer a variety of products tailored to meet the financial needs of consumers. Common banking products include:

Loans

Banks provide various types of consumer loans, such as mortgages, personal loans, and auto loans. These loans help individuals finance large purchases and manage their cash flow.

Savings and Checking Accounts

Savings and checking accounts are fundamental banking products. A savings account is designed to hold cash you don’t need right away and allow you to earn interest and grow your money over time.

Checking accounts are set up to offer easy access to funds for everyday transactions. They come with checks and typically a debit card that can be used for purchases or to withdraw funds at an ATM. Checking accounts generally earn little or no interest, though some banks now offer high-yield checking accounts.

Mortgages

Banks offer mortgage loans to help individuals purchase homes. These long-term loans typically come with fixed or variable interest rates and generally require you to use the property being purchased as collateral for the loan. Mortgage terms are typically 15, 20, or 30 years.

Investing Accounts

Many banks offer investment accounts, including IRAs and taxable brokerage accounts. These accounts enable customers to invest in stocks, bonds, mutual funds, and other financial instruments designed for long-term growth.

Credit Cards

Credit cards provide consumers with a revolving line of credit, allowing them to make purchases and pay for them over time. Banks earn interest and fees from credit card users, making it a significant revenue source.

Certificates of Deposit (CDs)

CDs are time deposits that offer a fixed interest rate for a specified term. You agree to leave your money in the account for a set period of time (which generally range from three months to five years). In return, these accounts typically pay a higher interest rate than a standard savings account.

Money Market Accounts

A money market account is a hybrid account that offers competitive interest on your balance, along with the conveniences of a checking account, such as a debit card and checks. However, you may be limited to a certain number of withdrawals per month. Some money market accounts also have minimum balance requirements.

Useful Bank Features

In addition to products, banks offer various services to help customers manage their money. Here are some features you may want to look out for when exploring different bank options.

Customer Support

Banks typically offer customer support through various channels, including phone, email, online chat, and in-person assistance. Whether you need assistance with your checking account or help choose between two banking products, a customer service rep can generally point you in the right direction.

Credit Score Checkers

Many banks offer tools that allow customers to monitor their credit scores for free. This service allows you to stay informed about your credit health and, if necessary, take steps to build your scores. Having strong credit can help you unlock credit cards, mortgages, and other types of loans with attractive rates and terms.

ATMs

Whether you open an account at a traditional brick-and-mortar institution or an online-only bank, you’ll typically have access to a wide network of fee-free automated teller machines (ATMs). This allows you to withdraw cash or make deposits without needing to visit a branch during business hours.

Online/Mobile Banking

Online banking and mobile banking apps allow you to monitor your accounts, transfer money, pay bills, and deposit checks from your computer or mobile device.

Financial Planning Tools

Many banks offer financial planning tools that help customers budget, save, and invest wisely. These tools can include calculators, goal-setting features, and personalized financial advice.

Bank Regulations

While banks are typically privately owned entities that must answer to their shareholders, banking is a highly regulated industry. Regulatory bodies, such as the Federal Reserve, Federal Deposit Insurance Corporation (FDIC), and Office of the Comptroller of the Currency (OCC), oversee banks’ operations, ensuring they adhere to laws and maintain sufficient capital reserves. This is to minimize disruptions and ensure the U.S. banking system runs smoothly.

The majority of U.S. banks are also insured by the FDIC. This covers deposit accounts up to $250,000 per insured bank, per depositor. Co-owners of joint accounts at the same bank are typically each insured up to $250,000. The agency’s BankFind site can help you identify FDIC-insured banks throughout the country.

Types of Banks

There are several different types of banks, each serving different purposes and customer bases. The large global banks often operate separate arms or divisions for each of these categories.

Retail Banks

Retail banks focus on individual consumers, rather than businesses or other banks. They provide personal banking services, such as checking and savings accounts, personal loans, mortgages, auto loans, short-term loans like overdraft protection, and credit cards. They may also offer access to investment products, such as mutual funds and IRAs.

While some retail banks offer in-person services through brick-and-mortar locations, others operate exclusively online. Due to lower overhead costs, online banks tend to offer higher yields on savings accounts and charge lower (or no) fees.

Recommended: What Is Neobanking and How Does it Work?

Corporate Banks

Corporate banks (also known as commercial banks) cater to large businesses and corporations. They also serve government agencies and institutions like colleges and universities. Along with business checking and savings accounts, these banks offer business loans and lines of credit, letters of credit, payment processing, foreign exchange transactions, and more for their clients.

Investment Banks

Investment banks serve as intermediaries in large, complex financial transactions. They specialize in initial public offerings (IPOs), raising capital, facilitating mergers and acquisitions, and providing advisory services to corporations and governments. Unlike retail banks, they do not take deposits from or provide loans to the general public.

Central Banks

Central banks manage a nation’s monetary policy, regulate the banking industry, and act as a lender of last resort. The central bank in the U.S. is the Federal Reserve (a.k.a, “the Fed”). The Fed sets the federal funds rates, which impacts everything from the annual percentage yields (APYs) you earn on savings accounts to the interest rates you pay on credit card balances and loans. Unlike the banks types listed above, central banks do not deal directly with the public.

Pros and Cons of Banks

Retail and commercial banks offer myriad benefits, but they also have some downsides. Here’s a look at how the pros and cons stack up.

Pros	Cons
Safe and secure	Potential fees for various services
Easy access to funds	Lower interest rates on deposits
Wide range of services	Potentially complex fee structures
Highly regulated	Potential for poor customer service

Pros

• Safety: Banks provide a secure place to store money, reducing the risk of theft or loss. Deposits in most banks are federally insured (up to certain limits), which means that even if the bank were to fail, customers will still recover their funds, up to the insured limit.

• Convenient access to funds: Banks offer easy access to funds through a network of branches, ATMs, and digital banking platforms.

• One-stop shop: Banks provide a variety of financial services beyond basic checking and savings accounts, allowing you to manage all aspects of your finances under one roof.

• Regulatory protection: Banks are heavily regulated by government agencies. These regulations protect consumers from fraud, ensure the safety of deposits, and promote ethical banking practices.

Cons

• Fees: Banks often charge fees for their services, including fees for account maintenance, overdrafts, and wire transfers.

• Low interest rates: Many banks offer relatively low interest rates on savings accounts and other deposit accounts. These rates often fail to keep pace with inflation, which can diminish the purchasing power of your savings over time.

• Complex fee structures: The complexity of bank fees can create confusion for customers and result in unexpected expenses.

• Potential for poor customer service: Large banks may offer impersonal or poor customer service due to their size and scale.

Banks vs Credit Unions

While banks and credit unions offer similar financial services, there are key differences between them. Here’s a closer look:

Ownership

Banks,typically, are owned by shareholders and operate for profit. Credit unions, by contrast, are owned by their members and operate on a not-for-profit basis. The main goal of a credit union is to benefit its members.

Fees and Interest Rates

Credit unions often offer lower fees and better interest rates on loans and savings accounts compared to traditional banks, as they are not driven by maximizing profits.

Membership

Banks are open to the general public. Credit unions require membership, which may be based on specific criteria such as employment, geographic location, or affiliation with a particular organization.

Customer Service

Credit unions tend to provide more personalized customer service due to their smaller size and member-focused approach. While small banks can also offer personalized customer service, larger banks may lack the personal touch.

Getting Started Banking With SoFi

A bank is an excellent resource to help manage your money. You can deposit funds for safekeeping, manage everyday spending, and invest for the future. Understanding the products, services, and perks offered by different banks can help you find the institution for your needs.

Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.

Better banking is here with SoFi, NerdWallet’s 2024 winner for Best Checking Account Overall.* Enjoy up to 4.60% APY on SoFi Checking and Savings.

FAQ

How do banks make money?

Banks primarily make money by lending out deposits at higher interest rates than they pay to depositors, earning the interest rate spread. They also earn money from the fees they charge for account maintenance, overdrafts, and transactions. Additionally, banks may invest in securities and earn returns.

Why do they call it a bank?

The term “bank” is thought to originate from the Italian word “banca,” which means bench or counter. In medieval times, moneylenders conducted their business on benches in marketplaces, and the term evolved to represent financial institutions.

What is a bank, simply put?

Simply put, a bank is a financial institution that accepts deposits and makes loans. Banks also play a key role in a nation’s economy, facilitating the management and movement of money for individuals, businesses, and governments.

Photo credit: iStock/Pgiam

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

The SoFi Bank Debit Mastercard® is issued by SoFi Bank, N.A., pursuant to license by Mastercard International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.

SoFi members with direct deposit activity can earn 4.60% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. Direct Deposit means a recurring deposit of regular income to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government benefit payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Direct Deposit”) via the Automated Clearing House (“ACH”) Network during a 30-day Evaluation Period (as defined below). Deposits that are not from an employer or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, or are non-recurring in nature (e.g., IRS tax refunds), do not constitute Direct Deposit activity. There is no minimum Direct Deposit amount required to qualify for the stated interest rate.

As an alternative to direct deposit, SoFi members with Qualifying Deposits can earn 4.60% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Qualifying Deposits means one or more deposits that, in the aggregate, are equal to or greater than $5,000 to an account holder’s SoFi Checking and Savings account (“Qualifying Deposits”) during a 30-day Evaluation Period (as defined below). Qualifying Deposits only include those deposits from the following eligible sources: (i) ACH transfers, (ii) inbound wire transfers, (iii) peer-to-peer transfers (i.e., external transfers from PayPal, Venmo, etc. and internal peer-to-peer transfers from a SoFi account belonging to another account holder), (iv) check deposits, (v) instant funding to your SoFi Bank Debit Card, (vi) push payments to your SoFi Bank Debit Card, and (vii) cash deposits. Qualifying Deposits do not include: (i) transfers between an account holder’s Checking account, Savings account, and/or Vaults; (ii) interest payments; (iii) bonuses issued by SoFi Bank or its affiliates; or (iv) credits, reversals, and refunds from SoFi Bank, N.A. (“SoFi Bank”) or from a merchant.

SoFi Bank shall, in its sole discretion, assess each account holder’s Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving a Direct Deposit or $5,000 in Qualifying Deposits to your account, you will begin earning 4.60% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.

SoFi Bank reserves the right to grant a grace period to account holders following a change in Direct Deposit activity or Qualifying Deposits activity before adjusting rates. If SoFi Bank grants you a grace period, the dates for such grace period will be reflected on the APY Details page of your account. If SoFi Bank determines that you did not have Direct Deposit activity or $5,000 in Qualifying Deposits during the current 30-day Evaluation Period and, if applicable, the grace period, then you will begin earning the rates earned by account holders without either Direct Deposit or Qualifying Deposits until you have Direct Deposit activity or $5,000 in Qualifying Deposits in a subsequent 30-Day Evaluation Period. For the avoidance of doubt, an account holder with both Direct Deposit activity and Qualifying Deposits will earn the rates earned by account holders with Direct Deposit.

Members without either Direct Deposit activity or Qualifying Deposits, as determined by SoFi Bank, during a 30-Day Evaluation Period and, if applicable, the grace period, will earn 1.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances.

Interest rates are variable and subject to change at any time. These rates are current as of 10/24/2023. There is no minimum balance requirement. Additional information can be found at https://www.sofi.com/legal/banking-rate-sheet.

*Awards or rankings from NerdWallet are not indicative of future success or results. This award and its ratings are independently determined and awarded by their respective publications.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .

External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.

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Source: sofi.com

Apache is functioning normally

August 18, 2024 by Brett Tams

Burglaries decreased substantially from 2012 to 2022 (the most recent year of data available), according to the FBI

. However, burglaries rose 26% between 2021 and 2022, reaching nearly 850,000 — still a significant number, considering that the FBI’s Crime Data Explorer contains data from only about two-thirds of American law enforcement agencies in that period.

It’s likely no coincidence, then, that home security systems have become much more advanced over the past decade. However, not all security systems are created equal. Here are five ways to maximize the effectiveness of your alarm system to prevent burglaries.

1. Display your home security system clearly.

According to the FBI, more residential burglaries occur during the day than at night

. What burglars see outside your home could make a difference. Accessories such as yard signs and window stickers can help broadcast your security system’s existence.

“These are crimes of opportunity,” says Geoff Kohl, Senior Director of Marketing at the Security Industry Association. Kohl cited a 2013 study led by a researcher from the University of North Carolina at Charlotte Department of Criminal Justice and Criminology, which found that over 80% of perpetrators would check a home to see if there was an alarm system or any security technology — and usually go to a different location if they spotted anything

“If you have a system, make sure you sign it,” Kohl says.

A sticker on a window might not be enough, though. Burglars may still check for an actual camera or keypad. Also, several alarm companies warn that fake stickers or signs mimicking an actual security company may violate copyright laws.

If you have actual security equipment, make sure those items are “extremely visible,” Kohl says. Hidden cameras have their value, but an outdoor camera in a prominent location can deter burglars. Many outdoor cameras are wireless, so you don’t need to sacrifice location for power.

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2. Protect entry points first.

According to the FBI, in 2019 (the most recent data for these statistics), 37.8% of burglaries were unlawful entries. This means the perpetrator did not use force to enter the home, such as breaking windows, picking locks or forcing doors open — they simply walked in

Investing in a smart door lock with a keypad that requires a code, especially a lock that can be locked and unlocked remotely, can provide vital protection for your home’s primary entry point — and give you peace of mind if you’re away from home and can’t remember if you locked the door, Kohl says.

“A key can be copied, and once it’s copied, you don’t know where it is,” he says.

Smart deadbolts are one way to give a friend or service provider access to your home for a limited time period — say, two hours to fix the plumbing or walk the dog — with a one-time code.

Even in cases where burglars do “break and enter,” they’re typically still using entry points, forcing open garage doors, windows or doors. With this in mind, securing your home’s entry points should be a priority, especially if you have a limited budget or are just getting started with home security.

If you’re ready to add to your system, door/window sensors that alert you when an entry point is open are a great next step. Some companies even make specific sensors for garage doors.

3. Leave the lights on (sometimes).

“You don’t want to broadcast the fact that you’re not around,” Kohl says. “If your house is the only house on the street where the lights have been out for two weeks, and if someone’s in the area and is maybe looking to perpetrate a crime, they’re probably going to notice that.”

If you’re planning an extended vacation, make sure you have someone to collect your mail, especially if it lands at your front door. Also, recreate some human activity. Many home security systems can turn lights on and off at scheduled times, simulating your typical daily routine even when you’re gone. There are even devices that mimic a TV flicker.

4. Invest in active deterrents.

Many outdoor cameras have motion-activated floodlights, which are usually very bright and might startle an intruder creeping along a home’s perimeter. Some even activate flashing lights and a loud siren — though this may be overkill if your system is prone to false alarms.

Whether you add deterrents to the outside of your home or not, it’s important that a door or window sensor triggers a siren if your system is armed. If your system sends you a phone alert but nothing physically occurs in the home, an intruder may not be deterred.

5. Consider professional monitoring.

Even with deterrents in place, a break-in is still possible, and you may have no way to respond to alerts if you’re lying on a beach thousands of miles away (and burglary rates tend to rise during summer, according to the Department of Justice)

“If you’re on a cruise, you may not have internet connectivity, so if you’re self-monitoring your security system, you may not be able to look at that camera or see the status on that lock,” Kohl says. If someone breaks into your home and sets off an alarm or a camera alert, you’ll still need to contact local authorities to stop them.

Some companies require a multiyear contract for professional monitoring, which can work for those who want year-round protection, but others allow you to activate the service for just a month without a contract. Prices range from around $20 to $40 per month.

Still, professional monitoring can be worthwhile, Kohl says. It enables a home security company’s agents to send emergency services to your home if the alarm goes off, even if you’re not reachable.

Source: nerdwallet.com

Apache is functioning normally

August 16, 2024 by Brett Tams

Moving to Minnesota means embracing a state known for its beautiful lakes, vibrant cities, and welcoming communities. From the bustling streets of Minneapolis with its thriving arts scene to the scenic trails of Duluth along Lake Superior, Minnesota offers a unique blend of urban and natural attractions. However, the state’s harsh winters and strong cultural emphasis on outdoor activities require thoughtful consideration. Whether you’re browsing homes for sale in Minneapolis, considering renting in Saint Paul, or exploring houses for rent in Rochester, here’s what you need to know before moving to Minnesota.

Minnesota at a glance

Minnesota is a state that balances urban sophistication with natural beauty, offering a high quality of life. The three largest cities—Minneapolis, Saint Paul, and Rochester—each have their own unique appeal. Minneapolis, known for its numerous lakes, is a bustling urban center with cultural institutions like the Walker Art Center and the Minneapolis Institute of Art. Saint Paul, the state capital, exudes historic charm with its well-preserved architecture and thriving cultural districts like Lowertown. Rochester, home to the world-renowned Mayo Clinic, is a hub for healthcare innovation and offers a more laid-back, suburban lifestyle. Minnesota’s economy is bolstered by major employers such as Target, 3M, General Mills, and the Mayo Clinic, providing diverse job opportunities across various sectors.

The culture in Minnesota is rich and varied, with a strong emphasis on outdoor activities. Residents enjoy a wide range of year-round outdoor activities, from summer boating on the state’s 10,000 lakes to winter sports like ice fishing and snowmobiling. The state’s weather is characterized by cold, snowy winters and warm, pleasant summers, making it essential to be prepared for seasonal extremes. Despite the state’s overall high standard of living, there are affordable places to live, especially in smaller towns and suburbs like Mankato and St. Cloud, which offer lower housing costs while still providing access to urban amenities.

1. The winters here are long

Winters in Minnesota are notoriously long and harsh, with temperatures often dipping well below freezing. Snowfall can begin as early as October and extend into April, making winter activities like snowshoeing, ice fishing, and skiing popular pastimes. To cope with the cold, many residents invest in high-quality winter gear, including insulated coats, boots, and even block heaters for their cars. Despite the challenges, Minnesotans embrace the season with festivals, such as the Saint Paul Winter Carnival, and by making the most of the snowy landscape.

2. You’ll get used to the “Minnesota Nice”

“Minnesota Nice” is more than just a saying; it reflects the genuine friendliness and politeness of the people in the state. Minnesotans are known for their reserved yet warm demeanor, often going out of their way to help others or strike up a friendly conversation. This culture of kindness extends to the workplace, neighborhoods, and even the roads, where people frequently yield to pedestrians and allow others to merge in traffic. For newcomers, adapting to this polite and community-focused atmosphere can make settling in much easier.

3. There are plenty of lakes to explore

Minnesota, known as the “Land of 10,000 Lakes,” actually has more than 11,800 lakes, offering endless opportunities for outdoor activities. Whether you’re into fishing, boating, or simply enjoying the scenic beauty, there’s always a lake nearby. Popular spots include Lake Minnetonka, known for its recreation and beautiful homes, and the Boundary Waters Canoe Area, which provides unparalleled experiences. In the winter, many of these lakes become hubs for ice fishing and skating, keeping the outdoor spirit alive year-round.

Insider scoop: If you’re ice fishing, remember that ice conditions can vary dramatically from one lake to another—local bait shops are a great resource for the most up-to-date safety information.

4. Minnesota prides itself on its state fair

The Minnesota State Fair, often called “The Great Minnesota Get-Together,” is one of the largest and most popular state fairs in the country. Held annually in late August and early September, the fair features a wide array of exhibits, live music, agricultural displays, and, of course, food on a stick. Signature treats like Sweet Martha’s Cookies, deep-fried cheese curds, and the famous “Pronto Pups” draw massive crowds. The fair is a beloved tradition for Minnesotans, reflecting the state’s agricultural roots and community spirit.

Travel tip: Plan to arrive early and use public transportation, like the park-and-ride services, to avoid the heavy traffic and parking hassles. This will give you more time to explore and enjoy all the fair has to offer.

5. The cost of living varies throughout the state

The cost of living in Minnesota can vary widely depending on the region, with the Twin Cities generally being more expensive than rural areas. In Minneapolis, for example, the median home sale price is around $350,515, while in smaller towns like Duluth, the median home sale price is closer to $302,000. Rental prices follow a similar pattern, with urban areas commanding higher rates like Saint Paul, where a one-bedroom is $1,311 compared to more affordable rural locations like Saint Cloud where rent goes for $875. Despite these differences, Minnesota remains an attractive place to live, offering a range of housing options and a quality of life that justifies the cost.

If you’re considering a move to one of the best places to live in Minnesota, it’s important to weigh the pros and cons to understand what life there truly entails.

6. There is plenty to do year-round

There are plenty of things to do in Minnesota throughout the year, catering to all interests. In the warmer months, living in Minnesota means enjoying hiking in state parks like Itasca or visiting cultural landmarks such as the Walker Art Center in Minneapolis. Fall brings stunning foliage and apple orchard visits, while winter is perfect for snowmobiling, cross-country skiing, and attending holiday markets. In the spring, the fishing season starts and you’ll be able to enjoy various outdoor festivals, making Minnesota a place where you can always find something to do, regardless of the season.

7. You’ll have to try its hotdish and juicy Lucy burgers

Minnesota’s culinary scene is steeped in tradition, with comfort foods like hotdish and Juicy Lucy burgers taking center stage. Hotdish, a hearty casserole typically made with ground beef, tater tots, and cream of mushroom soup, is a staple at gatherings and potlucks. The Juicy Lucy, a cheese-stuffed burger that originated in Minneapolis, is another must-try. Local joints like Matt’s Bar and the 5-8 Club in Minneapolis both claim to be the birthplace of this iconic burger, making it a culinary experience steeped in local lore.

8. Cycling is a big deal here

Minnesota is one of the most bike-friendly states in the U.S., with an extensive network of bike trails and lanes. The Twin Cities, in particular, are known for their cycling culture, offering trails like the Midtown Greenway and the Grand Rounds Scenic Byway. Even in winter, hardy cyclists continue to commute and ride for recreation, thanks to maintained trails and the growing popularity of fat bikes, which are designed for snow and rough terrain. The state’s commitment to cycling is reflected in its investments in infrastructure and community events, like the annual Tour de Tonka bike ride.

Insider scoop: Be prepared for bike-friendly amenities like heated bike racks and repair stations scattered throughout the Twin Cities.

9. Prepare for the mosquitoes

Minnesota’s abundant lakes and wetlands create ideal breeding grounds for mosquitoes, earning the unofficial nickname “The Land of 10,000 Mosquitoes.” These pests are particularly active in the summer months, especially around dusk. To cope, residents often use insect repellent, wear long sleeves and pants in the evening, and install screens on windows and doors. Despite their prevalence, Minnesotans don’t let mosquitoes deter them from enjoying the great outdoors, with many investing in outdoor products like citronella candles and bug zappers to minimize the nuisance.

10. Minnesota has skyway systems in place

In the Twin Cities, particularly Minneapolis and St. Paul, extensive skyway systems connect buildings, allowing residents and workers to move around downtown without stepping outside. These enclosed, climate-controlled walkways are especially beneficial during the harsh winters, making it possible to navigate the city comfortably regardless of the weather. The Minneapolis Skyway System, the largest in the world, spans 9.5 miles and connects 80 city blocks. This convenience contributes to the livability of the cities, particularly for those who work downtown or frequently visit the urban core.

11. The state has a strong cooperative movement

Minnesota has a long history of cooperative businesses, particularly in agriculture and retail, with the state serving as a leader in the cooperative movement. Organizations like Land O’Lakes and CHS Inc., both based in Minnesota, are among the largest agricultural cooperatives in the country. The cooperative spirit extends to food co-ops, credit unions, and even energy cooperatives, providing residents with community-focused, member-owned alternatives to traditional businesses.

12. Minnesota has a great job market

Minnesota has a strong job market with opportunities across various industries, including healthcare, technology, education, and manufacturing. The Twin Cities of Minneapolis and St. Paul are economic hubs, home to major corporations like Target, 3M, and General Mills. Additionally, the state has a strong commitment to education, with the University of Minnesota providing research and employment opportunities.

Methodology

Population data sourced from the United States Census Bureau, while median home sale prices, average monthly rent, and data on affordable and largest cities are sourced from Redfin.

Source: rent.com

Apache is functioning normally

August 15, 2024 by Brett Tams

Known for its striking skyline, iconic bridges, and tight-knit neighborhoods, Pittsburgh is a place where history and innovation coexist. Whether you’re drawn by the thriving job market, the affordable cost of living, or the burgeoning food and cultural scenes, there’s something here for everyone. Not sure if the ‘Burgh is for you? Read on to find out what to expect if you’re considering a move to the Pittsburgh area in 2024.

You know it from: Fences, The Fish That Saved Pittsburgh, The Bridge to Nowhere

Average 1 bedroom rent: $1,425 | Pittsburgh apartments for rent, Pittsburgh houses for rent

Average home price: $265,000 | Pittsburgh homes for sale

Average cost of full-service moving services: $105/hr for 2 movers

Average cost to rent a moving truck: $19 – $39/day

Top industries: Advanced Manufacturing & Technology, Education, Life Sciences

Move here for: Affordable cost of living, Sports, Great restaurants

Be sure to bring: A snow shovel and a yellow shirt for game days

1. The weather is a rollercoaster ride

Pittsburgh’s weather is known for its unpredictability. The city experiences all four seasons in full force, but often with surprising intensity. Winters can be harsh, with temperatures plunging below freezing and snowstorms that can disrupt daily life. On the flip side, summers bring high humidity and temperatures that can soar into the 90s. Spring and fall offer brief respites, but even these seasons are peppered with unexpected temperature swings. Be prepared to experience the full spectrum of weather conditions, sometimes all in the same week.

2. The bridges are beautiful—but they might confuse you

Pittsburgh is famously known as the “City of Bridges,” with 446 bridges crossing its three rivers: the Allegheny, Monongahela, and Ohio. While the bridges add to the city’s charm, they can also be a source of confusion for newcomers. Getting used to the constant crossing of bridges and navigating the city’s winding streets can be a challenge. But once you get the hang of it, the views from the bridges, especially during sunset, are nothing short of spectacular.

3. Pittsburgh is a hub for tech and healthcare jobs

Pittsburgh has transformed from its steel industry roots into a thriving hub for technology and healthcare. Companies like Google, Uber, and Facebook have set up shop here, drawing on the talent coming out of local universities like Carnegie Mellon. UPMC (University of Pittsburgh Medical Center) is one of the top employers in the city, offering a wealth of opportunities in the healthcare sector. The job market is robust, with an unemployment rate consistently lower than the national average.

4. You’ll need to learn to navigate the “Pittsburgh Left”

The “Pittsburgh Left” is a local driving quirk where the first car waiting at a red light turns left immediately when the light turns green, often before oncoming traffic. While this maneuver is rooted in politeness, it can be startling if you’re not familiar with it. Newcomers will quickly learn to anticipate this move, whether they’re the ones making the left or just waiting for the car in front of them to go.

5. Pittsburghers take their sports seriously

Sports are more than just a pastime in Pittsburgh—they’re a way of life. The city is home to legendary teams like the Steelers (NFL), Penguins (NHL), and Pirates (MLB), and the loyalty of the fan base is unmatched. Embracing the local sports culture is almost a rite of passage for newly minted Pittsburghers.

Moving Tip: On game days, the entire city seems to rally around its teams, with everyone donning black and gold. Even if you’re not a sports fan, you’ll quickly learn that the city’s mood can be influenced by the outcome of a game.

6. The cost of living is lower than you might expect

Compared to other major cities, Pittsburgh offers a relatively low cost of living. Housing is affordable, whether you’re looking to rent or buy, with prices significantly lower than in cities like New York or even nearby Philadelphia. Groceries, healthcare, and utilities are also more affordable, making Pittsburgh an attractive option for those looking to stretch their dollars further. However, be mindful that some neighborhoods, especially those close to the city center, are becoming more expensive as demand increases.

7. Pittsburgh is a city of neighborhoods

Pittsburgh is often described as a “city of neighborhoods,” and with good reason. The city is divided into more than 90 unique neighborhoods, each with its own distinct personality and charm. From the hip, youthful vibe of Lawrenceville to the historic, tree-lined streets of Shadyside, there’s a neighborhood to suit every taste. Squirrel Hill is known for its vibrant Jewish community, while the South Side is famous for its nightlife. Exploring these neighborhoods is one of the joys of living in Pittsburgh, as each offers something different.

8. Public transportation is limited but improving

Pittsburgh’s public transportation system, managed by the Port Authority, includes buses, light rail (the “T”), and inclines, but it’s far from perfect. While the city’s bus network is extensive, it can be slow and unreliable, particularly outside peak hours. The light rail system is limited in scope, serving mainly the southern suburbs and downtown. However, recent investments and plans for expansion are gradually improving the situation. For now, owning a car is still recommended if you need to get around efficiently, especially if you live outside of the city center.

9. The housing market is competitive

The housing market in Pittsburgh is heating up, with homes and apartments being snapped up quickly. This is especially true in popular neighborhoods like Lawrenceville, East Liberty, and the North Shore, where properties often receive multiple offers above asking price. While there are still deals to be found, particularly in less trendy areas, it’s essential to act fast if you find a place you love. Working with a local real estate agent who knows the market can give you an edge in securing your dream home.

10. Pittsburgh’s food scene is underrated

Whether you’re craving pierogies or sushi, Pittsburgh delivers. The city’s food scene has exploded in recent years, earning it a spot on many “must-visit” lists for foodies. Pittsburgh offers a diverse range of dining options, from classic comfort foods like Primanti Brothers’ sandwiches (fries included) to innovative cuisine from James Beard-nominated chefs. Ethnic food is also a big part of the culinary landscape, with notable options in neighborhoods like Bloomfield (Italian), Squirrel Hill (Jewish, Chinese), and the Strip District (everything from Asian to Middle Eastern).

11. Pittsburghers love their festivals

There’s always something happening in Pittsburgh, especially when it comes to festivals. The city hosts a wide range of events throughout the year, from the Three Rivers Arts Festival to the Pittsburgh Vintage Grand Prix. These events not only provide entertainment but also offer a chance to experience the city’s community spirit. The best part? Many of these festivals are free to attend, making them accessible to everyone.

12. Winter driving can be a challenge

Driving in Pittsburgh during the winter can be daunting, especially if you’re not used to snow and ice. The city’s many hills and narrow streets can become treacherous when covered in snow. Snow removal is a priority, but the weather can change quickly, leaving roads slick and dangerous. It’s worth noting that Pittsburghers have a bit of a love-hate relationship with their snow shovels—clearing sidewalks is a must.

Moving Tip: If you’re planning to drive in the winter, invest in a good set of snow tires and take it slow on the city’s winding roads.

13. Green spaces abound

Despite being a city with a strong industrial past, Pittsburgh is surprisingly green. The city is home to numerous parks, including the sprawling Schenley Park and Frick Park, where residents can enjoy outdoor activities year-round. The Pittsburgh Parks Conservancy has done an excellent job maintaining these spaces, making them accessible for everyone. Whether you’re into hiking, biking, or just relaxing in nature, there’s a park nearby that can accommodate you.

14. The cultural scene is accessible

Pittsburgh has a thriving cultural scene with a variety of museums, theaters, and music venues. The Carnegie Museums of Art and Natural History, the Andy Warhol Museum, and the Pittsburgh Symphony Orchestra are just a few of the highlights. The city’s size means that cultural experiences are more accessible and often more affordable than in larger cities. Whether you’re an art lover, a history buff, or a music enthusiast, you’ll find plenty to keep you entertained.

Methodology: Average rent prices sourced from Rent.com August 2024. Home prices sourced from Redfin August 2024. Average moving costs sourced from MoveBuddha. Employment data sourced from Visit Pittsburgh.

Apache is functioning normally

August 14, 2024 by Brett Tams

After a long day at work, you finally arrive at your apartment in New York or condo in Jersey City. You’re ready to kick off your shoes, relax, and unwind, but when you reach for your keys, you realize they’re nowhere to be found. Panic starts to creep in, but don’t freak out—staying calm is your best bet for solving the problem. Speaking of problem-solving, this ApartmentGuide article is full of tips to help you navigate what to do when locked out of your apartment.

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What to do when locked out of your apartment

1. Double-check for an unlocked entry

It might sound obvious, but before you start making calls or looking for other ways in, double-check all the potential entry points. Walk around your apartment and try every door and window. Sometimes, in our haste, we forget that we may have left a window slightly ajar or a backdoor unlocked.

2. Contact a roommate or family member

If you share the apartment with roommates, your first call should be to them. They might be able to come home quickly, or at least give you an estimated time of arrival. If you live alone, consider calling a trusted friend or family member who might have a spare key or be nearby to offer assistance.

3. Call the landlord or property manager

Most landlords or property managers have a spare key for situations like this. Give them a call, explain your situation, and ask if they can come by to let you in. Keep in mind that some may charge a fee for after-hours assistance, so it’s good to be aware of any policies they might have.

4. Reach out to a neighbor

If you have a friendly relationship with a neighbor, they might have a spare key or at least be able to offer a place to wait while you figure out your next steps. Some apartment buildings have a community-oriented atmosphere where neighbors look out for one another, making it easier to ask for help in a pinch.

5. Use your phone to search for a solution

If you have your phone with you, it can be a lifeline in this situation. Search for local locksmiths, check if your building has a 24/7 maintenance service, or see if there are any nearby businesses that might offer a temporary solution, like allowing you to make a call or wait in their space.

6. Try using a credit card or similar tool

If your door has a simple spring bolt lock, you might be able to use a credit card or another thin, flexible tool to slide the latch open. This method isn’t foolproof and doesn’t work on deadbolts, but in some cases, it can save you from having to call in professional help. Be careful not to damage the lock or door frame, as this could lead to more problems down the line. Here’s how to do it:

Use a card you don’t mind damaging, like an old gift card.
Slide it between the door and the frame, just above the lock.
Angle the card towards the handle and wiggle it to push the latch back. As you move the latch, gently push the door

7. Remove the doorknob

If you’re locked out and have access to basic tools, removing the doorknob can be an effective way to get back into your apartment. Here’s how to do it:

Gather tools: You’ll need a screwdriver, usually a flathead or Phillips, depending on your doorknob.
Locate the screws: Find the screws holding the doorknob in place. They’re usually on the interior side of the door, but some may be hidden under a decorative plate.
Unscrew the doorknob: Carefully unscrew the screws until the doorknob comes loose. You may need to remove both sides of the doorknob to release the latch mechanism.
Remove the latch: Once the doorknob is off, you should be able to slide the latch out of the door or manually retract it to open the door.

This method can be useful, but be careful not to damage the door or lock mechanism. If you’re unsure, consider calling a professional to avoid any potential issues.

8. Call a locksmith

If you’ve exhausted other options, it’s time to call a professional locksmith. While it’s an additional expense, a locksmith can get you back inside quickly and without damaging your property. Make sure to call a reputable service, as locksmith scams do exist. A quick online search or a recommendation from a friend can point you in the right direction.

9. Consider waiting it out

If you’re not in a rush and it’s during daylight hours, you might decide to wait until someone with a key comes home or your landlord is available. If the weather is nice and you’re in a safe area, this could be a less stressful option, especially if you’ve called someone and know help is on the way.

How to prevent from getting locked out of your apartment again

1. Know your management’s or buildings’ locked out policy

If your building has a leasing office, they may be able to assist you during business hours by letting you in with a spare key. However, after-hours, you might be on your own, so it’s important to know the options available.

Additionally, your lease agreement should detail the process for replacing lost keys or changing locks, which could involve fees or specific requirements. Familiarize yourself with these policies to be better prepared in case of a lockout.

2. Create a routine for your keys

Developing a consistent routine can significantly reduce the chances of forgetting your keys. Make it a habit to always place your keys in the same spot when you come home, like a key hook by the door or a specific pocket in your bag. Before leaving your apartment, do a quick check to ensure you have your keys in hand. This simple routine can save you from the hassle of a lockout.

3. Invest in a smart lock

Smart locks offer a modern solution to the traditional key. With a smart lock, you can unlock your door using your smartphone, a keypad, or even a fingerprint. Some smart locks also allow you to grant temporary access to guests or service providers. While they can be more expensive than standard locks, the convenience and security they offer make them a worthwhile investment.

Just be sure to check with your landlord before installing one, as some may have specific requirements or restrictions regarding changes to the locks.

4. Hide a spare key in a secure location

If you prefer to stick with a traditional lock, consider hiding a spare key in a discreet, secure location outside your apartment. Avoid obvious spots like under the doormat or a flowerpot—these are the first places someone might look. Instead, get creative and find a place that’s not immediately obvious but still accessible to you in an emergency.

For example, you could place a magnetic keyholder under a metal railing or tuck the key inside a weatherproof container and bury it near a distinctive rock in your garden. Another option could be hiding the key behind a loose brick. Alternatively, you can leave an extra key in your car, hidden in the glove compartment.

5. Leave a spare key with a trusted neighbor or friend

Another option is to leave a spare key with a trusted neighbor or nearby friend. This way, if you find yourself locked out, you can simply give them a call for help. Make sure the person you choose is reliable and someone you feel comfortable relying on in a pinch… Also, make sure they won’t lose the key either.

6. Use a keychain with a tracker

If you’re prone to misplacing your keys, consider attaching a tracker to your keychain. Devices like Tile or Apple AirTag can help you locate your keys quickly using your smartphone. This can be especially useful if your keys tend to get lost in your home or office rather than outside.

7. Opt for a keyless entry system

Some apartment buildings offer keyless entry systems that use a fob or a card instead of a traditional key. If your building has this option, consider upgrading. Keyless systems are convenient and often come with backup options like a keypad or app access, further reducing the risk of a lockout. If your building doesn’t currently offer keyless entry, it might be worth discussing with your property manager to see if they would consider upgrading.

Source: apartmentguide.com

Apache is functioning normally

August 14, 2024 by Brett Tams

Growing Your Own Food: Expert Tips for Backyard and Small-Space Gardening

Dreaming of fresh, homegrown produce without a sprawling backyard? Whether you live in a house in New York, NY, or an apartment in San Antonio, TX, growing your own groceries in your own home is entirely achievable. Gardening experts offer invaluable insights to transform your green thumb aspirations into a reality. Discover how to maximize your space, select the right plants, and nurture your harvest from seed to table. Get ready to embark on a rewarding journey of self-sufficiency and culinary delight, starting with what you learn about growing your own food from this ApartmentGuide article and our experts!

Farmer B’s guide to local and low-stress gardening

Expert gardener and farmer Brandi Clark, best known as “Farmer B,” offers invaluable advice for aspiring green thumbs. She suggests starting your gardening journey by purchasing plant-starts at a local nursery. This, she believes, is a less stressful entry point into the world of gardening. “Don’t overthink it,” she advises. “The most important thing is to grow your groceries in a way that suits your lifestyle and available space. Whether it’s a traditional in-ground garden, raised beds for convenience, or container gardening for limited space, there’s a perfect method for everyone.”

Photo Courtesy of Brandi Clark

Farmer B is a staunch supporter of local businesses and encourages gardeners to source their materials as close to home as possible. Using local soil tailored to your region’s climate is crucial for plant health, she explains. Additionally, patronizing nearby nurseries fosters community connections and ensures access to plants well-suited for your specific growing conditions. For those facing challenges in sourcing plants, Farmer B recommends exploring local farms. “Many farms offer plant sales throughout the growing season,” she notes. “It’s a great way to find unique varieties and support local agriculture.”

Growing your own food: simple tips from Lana Stenner

Lana Stenner, a Kansas City-area lifestyle and farm blogger, suggests that you first find a sunny spot in your yard with good drainage. Most plants thrive with at least six hours of direct sunlight per day. Check your USDA Planting Zone to select plants that will flourish in your local climate.

To create healthy soil and deter weeds, try the no-till method. Place cardboard boxes on your grass, then layer with organic materials like hay, leaves, compost, and topsoil. This “garden lasagna” approach, as gardening expert Lana Stenner calls it, is quick and effective.

Water your garden consistently, but avoid overwatering. Deep, infrequent watering encourages strong root growth. For best results, water early in the morning to minimize evaporation and mold. Start with easy-to-grow vegetables like tomatoes, lettuce, or herbs. Focus on plants you love to eat and follow proper spacing and planting guidelines.

Mulching around your plants helps retain moisture, suppress weeds, and regulate soil temperature. Organic mulches like wood chips or leaves also improve soil health. Regularly remove weeds while they’re small.

Finally, harvest your produce at its peak for the best flavor and nutrition. Share your bountiful harvest by hosting an outdoor gathering with friends and family. Enjoy the fruits of your labor!

From kitchen to garden: Avocado Skillet’s gardening tips

Kristi Roeder, the gardening enthusiast behind Avocado Skillet, shares her passion for backyard cultivation. “Gardening is both challenging and incredibly rewarding,” she says. “It’s an experience everyone should try.”

To simplify her gardening journey, Kristi opted for a raised bed container. She filled it with a nutrient-rich mix of 95% raised bed potting soil, topped with topsoil, and a small amount of blood meal and bone meal for added nourishment. “An expert gardener recommended this soil combination, and it’s been a game-changer,” she shares. While learning through her first gardening season, Kristi emphasizes the importance of sunlight. “Place your raised bed in the sunniest spot possible,” she advises. “Partial shade hindered my fruit production.”

When it comes to plant selection, Kristi suggests starting with lettuce and herbs. “They’re easy to grow and provide quick rewards,” she explains. Cucumbers, while simple to cultivate, require ample space. “Avoid overcrowding your plants,” she warns. “Quality over quantity is key.”

Consistent watering is essential, especially during the hot summer months. “Don’t skimp on the water,” Kristi advises. “Your garden will thank you.”

Joel Salatin: Gardening for everyone

Joel Salatin, a renowned farmer and author from Polyface Farm, offers practical advice for home gardeners of all levels. He emphasizes the connection between reducing grocery bills and improving nutritional intake. Even with limited space, Salatin believes anyone can cultivate their own food.

“Start small and be realistic,” he advises. “A windowsill garden of mung bean sprouts is a great beginning.” Salatin encourages utilizing available resources, such as rooftops for beekeeping, under-sink vermicomposting, or transforming a southern wall into a living plant display.

Soil health is paramount, according to Salatin. “Become a carbon collector,” he urges. “Gather grass clippings, leaves, and wood chips to create rich compost.” Incorporating kitchen scraps and animal manure, if available, further enhances soil fertility.

When selecting plants, Salatin suggests focusing on a few favorites rather than overwhelming yourself. “Start with what you love to eat,” he advises, “and build from there.” He also emphasizes the importance of garden design. Raised beds improve accessibility and protect plants from pests, while water conservation is crucial for garden success.

By following these fundamental principles, Salatin believes anyone can experience the joys and rewards of home gardening.

Farm Brite offers expert advice for budding gardeners

“Start small and gradually expand your garden,” advises Farm Brite. Focusing on a few plants initially allows you to understand their care requirements without feeling overwhelmed. Prioritize growing what you love to eat, as this will increase your engagement and enjoyment.

Careful planning is essential. Use a garden planning tool to determine plant spacing and ensure your garden fits your available space. Consider container gardening for smaller areas.

To streamline your gardening routine, automate tasks like watering. Regular weeding is important, but don’t strive for perfection. Invest in quality gardening tools to make tasks easier.

Above all, have fun with your garden! Experiment, learn from your experiences, and enjoy the satisfaction of harvesting your own food.

RailScapes: A new approach to urban gardening

Deborah Holtschlag, founder of Plant Traps, offers a new approach to urban gardening. Holtschlag introduced RailScapes as a solution for those with limited outdoor space. These innovative planters are designed to be easily installed on railings, transforming them into vertical gardens. By optimizing vertical space, RailScapes provide a practical and aesthetically pleasing way to cultivate plants on balconies or decks.

Holtschlag emphasizes the product’s functionality, noting that RailScapes protect plants from wind damage and prevent water runoff. She believes the product offers a fresh perspective on urban gardening.

Farm Raise offers gardening guidance

Farm Raise provides practical advice for home gardeners seeking to maximize their harvest. The organization emphasizes the importance of aligning your garden with your local ecosystem by prioritizing native plants. Understanding your region’s climate and soil conditions is crucial for selecting suitable crops and optimizing growth.

To ensure a bountiful harvest, Farm Raise suggests careful planning for post-harvest activities. Some crops, like beans and squash, require minimal processing, while others demand additional efforts such as pickling or canning. Assess your time and resources to determine the best approach for your garden’s produce.

By incorporating these strategies, home gardeners can increase their chances of success and enjoy a rewarding experience cultivating their own food.

Farm the future at home

Imagine a garden that thrives without constant tending. With Farmonaut, this isn’t a dream; it’s a reality. They bring cutting-edge technology to your backyard, transforming gardening from a chore into a rewarding experience. Farmonaut Technologies is revolutionizing home gardening with innovative technology that simplifies the growing process and maximizes yields. By harnessing the power of data and AI, Farmonaut empowers gardeners to make informed decisions, optimize resource utilization, and achieve bountiful harvests.

From precise soil analysis to advanced weather forecasting, their platform provides essential insights for garden success. By addressing common challenges such as pests, diseases, and water management, Farmonaut helps gardeners grow healthier, more resilient crops.

With their user-friendly tools and expert guidance, anyone can transform their green space into a thriving edible oasis.

Photo Courtesy of Farmonaut Technologies

Reap the rewards of homegrown goodness

By incorporating these expert-backed strategies into your gardening endeavors, you’ll be well on your way to growing your own groceries and enjoying the countless rewards that come with it. Remember, gardening is a journey, not a destination. Experiment, learn, and most importantly, savor the satisfaction of nurturing life from the ground up.

Apache is functioning normally

August 13, 2024 by Brett Tams

Annual business revenue refers to the income generated by a business over the course of one year before any expenses are deducted. This is a key number for business owners to know because it tells you how well your company is doing.

Knowing your annual revenue also allows you to track your company’s performance against itself in previous years, as well as against competitors.

Read on to learn how to quickly calculate your business’s annual revenue, plus how you can use this metric to monitor and grow your small business.

Key Points

• Annual revenue is the amount of money a business generates in one year. It is the number before expenses are deducted.

• Annual revenue can be based on a calendar year (beginning January 1) or a fiscal year (July 1 to June 30 of the following year, for example).

• To calculate annual revenue, multiply the number of units sold by the sale price.

• Annual revenue is an important financial metric to determine the health of your business. It also helps if you need to apply for a small business loan or pitch your company to investors.

What Is Annual Business Revenue?

Annual revenue for a business refers to the amount a business made in sales over 12 months, whether that’s for products, services, or both. This number is also often referred to as the “top line,” since it’s added to the top of a business’s income statement. Annual revenue does not account for any of your expenses, such as payroll, operating costs, and rent.

How does annual business revenue differ from profits? Profit is the amount you have after you subtract annual expenses from annual revenue.

How Does Annual Business Revenue Work?

When calculating business revenue, you’ll include money you earn from your main business activities, such as sales of your products or services, as well as revenue you earn from activities not directly related to your business, such as interest from investments or renting a floor of your building to another company.

There are also two different ways to calculate annual revenue: It can be over a fiscal year, which is from whatever point in the year you start calculating, like July 1, to the same date the following year. Or, it can be a calendar year, which would start on January 1. Some businesses prefer to use one method over the other.

Either way, it’s important to calculate and track your annual revenue. Doing so helps you determine if your business is making a profit and growing. It can also assist you in preparing to pitch to investors, applying for small business loans, and planning and strategizing for future growth.

How to Calculate Annual Business Revenue

To calculate annual business revenue, you’ll need to determine your firm’s different revenue streams. To start, compile information on the selling price and quantity the company sold for each product or service. To calculate the total revenue of each product or service, use this simple formula:

Annual Revenue of Product or Service = Number of Units Sold x Sale Price

If you sell different products and services at different prices, you would use the above formula to calculate the revenue for each product or service, and then add each total together to get your total revenue from your business’s operations.

Next, you’ll want to add any other income (including investment income or sales of any assets) your business earned over the year to get your total annual business revenue.

Annual Business Revenue Example

For this example, let’s say you sell jewelry. For simplicity’s sake, let’s say you only have three products:

• Necklaces: $200

• Rings: $100

• Bracelets: $75

Last year, you sold 500 necklaces, 750 rings, and 1,000 bracelets. We start our calculations by figuring out your revenue for each.

• Necklaces: $200 x 500 = $100,000

• Rings: $100 x 750 = $75,000

• Bracelets: $75 x 1,000 = $75,000

Now we add each of these together to calculate total revenue.

100,000 + 75,000 + 75,000 = $250,000

Assuming you didn’t have any other sources of income, your annual business revenue would be $250,000. Remember, this is before taking any expenses into account. Your profits will be what you calculate after subtracting the expenses involved in making the jewelry, as well as operating expenses, from your total revenue.

What Is Considered Good Annual Small Business Revenue?

What’s considered a good annual revenue for a small business depends on the size of the business. The average annual revenue for a small business with a single owner and no employees is $44,000 per year. As the number of employees starts to rise, so does the average revenue.

The average revenue for companies with one to four employees is $387,000, while the average revenue for businesses with up to nine employees is around $1 million.

Recommended: Business Cash Management, Explained

What Is Annual Business Revenue Used For?

Knowing your annual revenue is the first step to determining the health of your business. You’ll need to know exactly how much your business is bringing in each year to determine if your business is growing or stagnant, as well as calculate whether it has healthy profit margins. You’ll also need to know your annual business revenue when you file your taxes and if you ever apply for a business credit card, line of credit, or small business loan.

Recommended: Business Loan vs Personal Loan: Which Is Right for You?

The Importance of Annual Business Revenue

Annual revenue is one of the most important financial metrics for any business. As a business owner, knowing your annual revenue provides insight into whether your firm is generating enough earnings to not only cover its expenses but also invest in opportunities for growth.

Annual business revenue is also important to potential investors and lenders. Investors will use annual revenue (among other metrics) to assess whether or not a company is worth investing in. They will often look at a company’s revenue growth rate and compare it to their competitors to determine if it’s a good investment opportunity.

Lenders will look at a company’s annual revenue to assess its creditworthiness. A higher annual revenue indicates that the business has the ability to repay its debts and represents a low risk to the lender.

Recommended: No Doc Business Loans

Is Including Annual Recurring Revenue Worthwhile?

Annual recurring revenue (ARR) is a metric primarily used by businesses operating on a subscription-based model. ARR tells you the normalized annual revenue that a company expects to receive from its subscribers in return for products and services provided. In other words, it is the predictable and recurring revenue generated by customers within a one-year period.

ARR is similar to monthly recurring revenue (MRR) — the key difference is that ARR is normalized to a year rather than a month.

For some businesses, annual recurring revenue is a valuable metric that can help owners quantify a company’s growth, evaluate its subscription model, and forecast its revenue.

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Distinguishing Net Business Income From Gross Annual Revenue

While looking at your annual business revenue is helpful for understanding how your business is doing at generating sales, it’s not the full picture. If you’re spending more than you’re making, your business will struggle to stay afloat.

That’s why it’s important to determine both your annual business revenue (also known as gross revenue), as well as your net business income.

Net business income is the amount of profit your company has left over after paying all its expenses. This number lets you know how well you’re doing at keeping expenses lower than revenues so you have a decent profit margin.

You can look at your small business income statement to see both revenues and expenses to help you strategize how to increase net income.

Here’s a quick snapshot of gross annual revenue vs. net business income.

Gross Annual Revenue	Net Business Income
Cash generated by a business before taking out expenses	Total earnings after accounting for any expenses
Indicates how successful a business is at making sales	Indicates how financially healthy a business is

Types of Revenue

When determining your annual business revenue, you’ll want to be sure you include the two main types of business revenue.

Operating Revenue

Operating revenue includes sales from products or services you regularly sell. In other words, it is money earned from the core activities of the business. In the example above, revenue from jewelry sales falls under operating revenue. If you are a graphic designer, the logo or website design packages you sell fall into this category.

Non-Operating Revenue

Not all revenue that comes into your business is from your primary business activity or considered operating revenue. Non-operating revenue is the income your company brings in outside of its primary business activity. It tends to be sporadic and is not expected to be part of your business’s income on a regular basis.

Some common types of non-operating revenue that could still impact your business’s finances include:

• Interest: If your company offers financing to customers or invests in the stock market, the interest you gain from these transactions falls under non-operating revenue.

• Dividends: If your business invests in shares of another company, the profits you earn from this investment are part of your company’s annual non-operating revenue.

• Rent income: If you rent property or equipment, the money you receive from these rentals is part of your annual non-operating revenue.

• Asset and capital sales: If you sell a piece of equipment to another company, then the sale price is part of your annual non-operating revenue.

• Contra revenue: Unlike the other non-operating revenue, contra revenue has a negative value. Contra revenue, which can include returned goods, unpaid invoices, and unsold inventory, is a deduction from gross revenue.

Recommended: Net Present Value: How to Calculate NPV

The Takeaway

As a small business owner, there are numerous numbers you need to track. One of the most important is your annual business revenue. This number refers to the total amount of money your company makes during a year from the sale of products and services, plus any other additional income.

Annual revenue is the starting point from which you can determine your net revenue, which tells you whether your company’s sales are indeed exceeding its costs and the business is making a profit.

Calculating your annual revenue also allows you to track your company’s growth over time and compare its performance to industry peers. You’ll also need to know your annual revenue if you’re looking to bring in an investor or apply for any type of business financing.

If you’re seeking financing for your business, SoFi can help. On SoFi’s marketplace, you can shop top providers today to access the capital you need. Find a personalized business financing option today in minutes.

With SoFi’s marketplace, it’s fast and easy to search for your small business financing options.

FAQ

What is business revenue vs. income vs. profit?

Revenue is the total amount of funds that a business receives from its sales and services. Income is the amount of money a company makes minus the cost of running a business. Profit is the amount of money a business receives after it accounts for the cost of goods sold (COGS). Unlike income, profit doesn’t account for other operational costs like salaries or taxes.

How can you find your annual business revenue?

Annual revenue is the total income your business generates in one year before expenses. To calculate annual revenue, you’ll need to multiply the quantity of goods and services sold by the sales price for each item. This will give you your operating revenue. Next, look at your non-operating revenue — this is how much you earn from activities not directly related to your business (such as renting your building to other companies). You’ll need to combine operating and nonoperating revenue to calculate your annual business revenue.

Why is annual business revenue important to know?

You need to know your annual business revenue to file taxes for your business, determine your profit, and track your company’s performance year to year. If you decide to take out business financing, you’ll need to have your revenue numbers ready for the application.

How do you calculate business revenue?

A simple way to calculate business sales revenue is to multiply the number of sales by the sales price. To calculate total business revenue, you’ll also need to add in income from other sources (such as investments or renting out equipment).

Photo credit: iStock/CentralITAlliance

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SOSMB-Q324-013

Source: sofi.com

Apache is functioning normally

August 12, 2024 by Brett Tams

Right now, nine states do not charge state income taxes, which means residents in those states don’t need to file a state-level tax return. While an obvious benefit of that is a reduction in their annual tax liability, are there also drawbacks to living in a state without income taxes?

Here, learn the pros and cons of no state income tax. This intel can help you determine if living in a state with no income tax is better for you.

Key Points

• Living in states without income tax can significantly reduce an individual’s overall tax burden, benefiting primarily high-income earners during tax season.

• Higher sales and property taxes often compensate for the lack of income tax, potentially placing a heavier burden on lower-income residents in these states.

• Tax filing becomes simpler for residents in states without income tax, eliminating the need for state tax returns and associated expenses for tax preparation.

• The absence of income tax can lead to reduced funding for essential public services, such as education and infrastructure, impacting the quality of life.

• Although no income tax may attract new residents, the overall cost of living in these states can still be relatively high, complicating financial advantages.

Which States Have Zero State Income Tax?

Currently, nine states do not have state income tax on earned income:

• Alaska

• Florida

• Nevada

• New Hampshire^*

• South Dakota

• Tennessee

• Texas

• Washington

• Wyoming

^*New Hampshire currently charges state taxes on interest and dividends but not on income, but it is set to phase this out after 2026, as Tennessee has recently done.

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Recommended: Earned vs. Unearned Income on Taxes

What Are the Pros and Cons of Having No State Income Tax?

At first blush, having no state income tax sounds like a win for Americans — and for many high-earners, it might be. However, there are also downsides to living in a state with no income taxes. Here’s a closer look.

Pro: You’ll Spend Less Money on Income Taxes Overall

While nearly everyone must file federal taxes, residents in states without income taxes will benefit from a lower overall tax bill each tax season. This can be a boost to one’s financial health.

Con: You’ll Likely Spend More on Sales and Property Taxes

Just because states don’t charge income taxes doesn’t mean they’re not getting revenue through different types of taxes. States without income taxes sometimes have higher sales and property taxes, for example.

Tennessee, Washington, Nevada, and Texas are all in the top 20 states with the highest combined state and local sales tax. New Hampshire, Texas, and Florida all have property taxes higher than the national average — with the former two in the top 10 states overall.

An added con to this: Unlike income taxes, which get progressively higher based on your income level and resulting tax bracket, sales taxes are the same no matter how much you make. That means lower-income taxpayers shoulder a heavier tax burden in states with no income taxes, according to the Institute on Taxation and Economic Policy.

Pro: Tax Filing Is Easier

If you live in a state without income tax, filing can be a breeze. You’ll have one less tax filing deadline to worry about.

Those who reside where state tax is collected, however, may need to invest in professional tax software or an accountant to handle their state taxes. This is of course an added expense — and creates extra steps in the tax filing process.

Con: There’s Less in the Budget for Infrastructure and Education

States use income taxes to fund projects like improving infrastructure and investing in education. Without income taxes, there could be less in the budget for such investments.

For instance, Nevada, Florida, Tennessee, and South Dakota are all among the top 10 states that spend the least amount of money per K-12 student, per a report from the Education Data Initiative. The common thread? These four states don’t have income taxes.

Pro: Having No Taxes Can Attract People to Move to the State

A lack of state income taxes may be a selling point for many people looking to move, whether they are looking for a more affordable lifestyle, a welcoming state to retire in, or to be closer to friends and family.

Why does this matter? An influx of residents to a state can be a boon to the local economy.

Con: Cost of Living May Be Higher

Though it’s not the case across all nine states without income taxes, the cost of living could be higher. Four out of the nine states were among the 20 most expensive states to live in last year: Alaska, New Hampshire, Washington, and Florida.

Now, here’s how the pluses and minuses stack up in chart form:

Pros	Cons
Less money spent on income taxes	Potentially higher sales and property taxes
Easier tax filing	Potentially lower infrastructure and education spending
Potential state population growth	Potentially higher cost of living

Why Do Some States Have Zero State Income Taxes?

Some states may choose to enact a no-state-income-tax policy to encourage Americans to move there from other states and thus boost their economy. IRS and Census data backs up this theory.

It may also reflect local political sentiment: Conservative politics tend to favor lowering taxes, while progressive politics often prioritize the social programs that can be achieved through higher taxes.

Recommended: Tips on Saving Money Daily

Do States With No Income Tax Save Residents Money?

States with no income taxes save residents money — on their income taxes. However, many states without income taxes can be expensive in other ways. They might have a higher sales tax, higher property taxes, and/or a higher cost of living.

Before deciding on a move to a state without income taxes, it’s a good idea to view the whole picture by researching sales and property tax rates and overall cost of living.

Recommended: Tax-Friendly States that Don’t Tax Pensions and Social Security Income

Is Living in a State With No Income Tax Better?

Some taxpayers may say that living in a state with no income tax is better, but others might not. In general, high-income earners benefit more from a lack of state income taxes, since they may enjoy reduced taxes. Low-income earners, however, may actually shoulder more of the tax burden when states generate revenue from sales tax.

Taxpayers should also consider how much they value lower taxes versus more social programs and investments in things like infrastructure and education. Each individual will have their own opinion.

The Takeaway

States without income taxes may save you a lot of money when it’s time to file taxes, but there may be hidden costs of living in such states, like higher sales and property taxes. Before moving, it’s important to consider the full picture to better understand the potential impact on your finances.

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FAQ

Are other taxes higher in states with no income tax?

Though it varies, it is common for states without income taxes to make up for that lack of revenue through other forms of taxes, primarily sales and property taxes.

Are food costs more in states with no income tax?

Food costs contribute to a state’s total cost of living. In 2022, four of the 20 most expensive states to live in had no income taxes. While that doesn’t inherently mean food costs are higher in such states, it may validate that a disproportionate number of states with no income tax have higher costs of living.

Is living in a state with no income tax better for low- or high-income taxpayers?

High-income taxpayers benefit more from living in states with no income taxes. The more money you make, the higher percentage of your income you must pay in taxes, so high-earners will likely save more.

In addition, states with no income tax may see less spending on education, which can affect the quality of learning for students. High-income earners can probably more easily afford private schools for their children; such schools do not rely on taxes to operate. Low-income earners may not be able to afford private schools.

Photo credit: iStock/mihailomilovanovic

SOBK0123005

Source: sofi.com

Apache is functioning normally

August 8, 2024 by Brett Tams

Welcome to NerdWallet’s Smart Money podcast, where we answer your real-world money questions. In this episode:

Discover strategies for achieving early retirement with the FIRE movement and learn how to maximize your credit card rewards.

How much do you have to save if you want to retire early? Can you double your credit card rewards by paying off one card with another? Hosts Sean Pyles and Elizabeth Ayoola discuss the FIRE movement and maximizing credit card rewards to help you understand how to achieve financial independence and optimize your financial strategies. They begin with a discussion of the FIRE movement, with tips and tricks on understanding different FIRE strategies (Lean FIRE, Fat FIRE, Barista FIRE), adapting financial goals to individual circumstances, and the feasibility of saving significant portions of income amidst rising living costs and inflation.

Then, credit card Nerd Erin Hurd joins Sean to discuss maximizing credit card rewards. She explains the impossibility of doubling rewards by paying off one card with another, effective strategies for couples to maximize credit card points like leveraging multiple sign-up bonuses and using authorized users, and the best and worst ways to redeem credit card points, emphasizing considerations such as point expiration, the impact of inflation on point value, and the importance of having a realistic plan for point usage.

Check out this episode on your favorite podcast platform, including:

NerdWallet stories related to this episode:

Episode transcript

This transcript was generated from podcast audio by an AI tool.

Elizabeth Ayoola:

It’s another day at work doing the best job a girl could ask for, talking about money and hoping I earn enough to retire early.

Sean Pyles:

I feel you, Elizabeth. But given the current cost of living, is early retirement still a possibility? And how can people do that when it can be hard to save anything? Welcome to NerdWallet’s Smart Money Podcast. I’m Sean Pyles.

Elizabeth Ayoola:

And I’m Elizabeth Ayoola. Now this episode we are going to answer a listener’s question about how to get the most out of their credit card points. Are you better off using them to get cash back or booking airline tickets? Speaking of which, I might do that soon. And what about using them at checkout at Amazon? But before we dig into that, let’s chat a little bit about the FIRE movement, one of my favorite topics, and whether it’s still a thing considering how the cost of living has gone up for so many, even though inflation has been cooling lately.

So Sean, you should already know I’m going to be putting you in the hot seat and quizzing your CFP knowledge. For new listeners, Sean is studying for his designation, and he’s almost about to throw up a peace sign after his final exam. So tell us, Sean, what is FIRE?

Sean Pyles:

Yeah, I have just a few more months until I sit for the CFP exam, and the studying is getting very intense. But anyway, it means I know a lot more than I did even a few months ago, which is great. So FIRE stands for Financial Independence Retire Early, and it’s a movement aimed at using different saving strategies to help people, you guessed it, retire early. Early looks different for everyone, but it’s certainly before the Social Security retirement age of 66 or 67 depending on when you were born. The main goal is to save as much as you can to retire at your chosen age. For some people that means saving between 50% and 70% of their income for retirement. That probably sounds extreme, but that’s what it might take to avoid working into your golden years.

Elizabeth Ayoola:

Definitely sounds extreme for the average person, I think. But I do often sit and think about how nobody warned me that I would be spending decades of working or maybe I was too worried thinking about how I was going to stay married for decades and missed that I was going to be at work every single day, anyway. But assuming you start working at the age of 21 and retire at 66 without any career breaks, that’s like 45 years of working. So for people who do not have time for all of that, they tend to subscribe to the FIRE movement. I am people. As much as I love my job, I definitely would love some more flexibility. So anyway, there are various types of FIRE out there to fit one’s savings and lifestyle preferences, so to speak. But the main types of FIRE that are out there include Lean FIRE, Fat FIRE, and Barista FIRE.

Sean, do you quickly want to explain what those are for us? Break those down.

Sean Pyles:

Sure. So Lean FIRE is for people who want to retire early and retire fully, but it requires a steep sacrifice as you’ll likely have to save well over half of your income. It’s also ideal for people who can embrace a minimalist lifestyle and live off of little during retirement.

Fat FIRE is essentially the opposite. People who are high earners and want to continue maintaining that lifestyle in retirement. They have to invest larger amounts of money than Lean FIRE disciples for this reason. Finally, Barista FIRE is for folks who are more focused on choosing the type of work they do and the frequency at which they work. So think of people who want to partially retire and maybe work part-time. They save enough so they don’t need the bulk of their income to come from paid work.

Elizabeth Ayoola:

Love, love, love that. And I love how there’s so many different options for different people, but I personally would love to retire in my 40s or 50s and I’m definitely a Fat or Barista girl. So I want to do all the fabulous things during my retirement and I want to be a grandma and I want to bring my fabulous grandkids along sometimes. And just for the listeners, my 6-year-old son said he wants 10 kids, so who’s going to-

Sean Pyles:

Wow, that’s a lot of grandkids.

Elizabeth Ayoola:

It’s a lot of grandkids. And he said I’m apparently going to help him look after them, so I’m going to need a lot of money here. You know what I’m saying? Yeah, right. But yeah, I will always want to do some sort of meaningful work, that said, but would love more flexibility in terms of when I work and the type of work that I do. So Sean, is early retirement something you think about and where would you fall in between the three?

Sean Pyles:

I would love to retire early. Don’t get me wrong, I really like my job and helping people through my work gives me a sense of purpose and satisfaction, but also I want to do what I want when I want. So I think I would lean more toward the Barista FIRE. Once I have my CFP certification, I can see myself building a portfolio of clients that I manage and that would be my equivalent of Barista work.

Elizabeth Ayoola:

I love that. I love that, I love that. All right, so now I’m wondering how feasible it is to save half or more of your income in this economy. I know I’ve seen a few data points this year about Americans either dipping into their retirement accounts because of inflation or cutting back on retirement savings altogether. So for instance, the 2023 TIAA Institute-GFLEC Personal Finance Index found that 25% of employed adults cut their retirement savings because of inflation-induced financial pressure, and almost half of that group halted their savings altogether. Also, a 2024 Allianz Life Study found that 67% of Americans are more concerned about paying their bills than about their financial future. Another 42% have withdrawn from their retirement savings because of inflation.

So what is my point in all of these data points? The question is, is FIRE even still on people’s radar when they’re trying to survive daily expenses? My assumption is there is still a population of people who are feeling the pinch but can afford to still save more than the average person or make sacrifices to do so. Now, honestly, I was able to do it easily last year saving a big chunk of my income. But this year with new expenses, moving cities, and the cost of living, I’ve had to scale back some. So I’m still saving a decent chunk, I’d say, but certainly not half of my income or more.

Sean Pyles:

Yeah, I mean the truth is the FIRE movement is a pipe dream for most people, but so is the idea of completely retiring for many people, unfortunately. To zoom out, the median retirement savings for folks between the ages of 35 and 44 is $45,000. And for those between the ages of 55 and 64, it’s $185,000, and neither amount would be enough to fund decades of retirement. So for many people, retirement will be funded through some combination of money they’ve saved, Social Security, and some form of work. And a quick aside here, for those who are thinking that Social Security won’t be around when they retire, I say please do not fall for numerous political messaging. We have earned these benefits and we need to fight for them if we want them, but that’s my own little thing.

Elizabeth Ayoola:

I know that’s right because I’ve earned the benefits and I need them when I retire. So we’re in the fight together, Sean. That said, I understand that it’s probably not feasible for the average person to participate in FIRE and save half of their income. In some instances, it might require getting an extra job or a side hustle to fund those early retirement dreams. That’s what I personally did, but it did take a lot of discipline and sacrifice because I was working more than I probably would have wanted to. And I wasn’t able to go on shopping sprees or vacation on a whim because I was like, “Hey, got to earmark this for retirement.”

Sean Pyles:

Totally. So if retiring early really is a priority for you, it is going to take some combination of living off much less than you earn, likely increasing the amount that you do earn, and getting really creative about how you save and invest money. And this does raise the question of how much you even need to retire. For many people, they can get away with living off of 80% of their current salary in retirement. So for a very basic estimate of how much you might need to retire early, figure out what 80% of your salary is, multiply that by your life expectancy, and you have the magic number that you need to save for. Again, that’s at a really simple level at least.

Elizabeth Ayoola:

Right. And I think even if people aren’t with the FIRE movement, it’s still good to think about what your retirement plan is. And I’m often talking to friends, family, and one of my favorite icebreaker questions is “When do you want to retire?” I know I’m not a fun icebreaker, but still, it does get people thinking about “Ooh, when do I want to retire?” And then it gets the ball rolling in terms of starting to do that math to see how much you need to save. So while you may not be able to retire in your 50s or 40s, it doesn’t hurt to see where you are and whether you can even afford to retire at the Social Security retirement age with your current savings and the pace that you’re currently putting away money as well.

Sean Pyles:

Yeah, sometimes seeing that number can be the motivation that you need to get more organized with your money, ask for that raise or even start looking for a higher-paid job.

Elizabeth Ayoola:

Right, and even if you can’t save the amount you want to right now, having a plan in place means as soon as your income increases, you can roll that plan into action. It’s easy to put off thinking about it, but as my mom friends say, the days are long, but the years are short. And I think to whatever extent we can control, we should try and set ourselves up for the best retirement possible. And money plays a huge role in that.

Sean Pyles:

So I think the bottom line here is that yes, the world is expensive, but there are also plenty of people who earn a lot of money and are able to sock away a big portion of that money. FIRE is still feasible for a dedicated privileged few, but for the rest of us, we’ll have to keep working hard, saving our money, and doing what we can to ensure that Social Security pays out when we are in our golden years.

Elizabeth Ayoola:

And playing the lottery. Just kidding.

Sean Pyles:

If you’re lucky.

Elizabeth Ayoola:

Sean Pyles:

Well, before we get into this week’s money question, we have an exciting announcement. We are running another Book Giveaway Sweepstakes ahead of our next Nerdy Book Club episode. Our next guest is Janice Torres, author of “Financially Lit, the Modern Latina’s Guide to Level Up Your Dinero and Becoming Financially Ponderosa,” which offers tips to young people on how to get started with managing their money.

Elizabeth Ayoola:

To enter for a chance to win our Book Giveaway, send an email to [email protected] with the subject book sweepstakes during the sweepstakes period. Entries must be received by 11:59 PM PT on August 22nd, so you’ve got a couple of weeks. Include the following information: your first and last name, your email address, your zip code, and your phone number. If you need more information, please visit our Official Sweepstakes Rules page.

Sean Pyles:

We are back and answering your money questions to help you make smarter financial decisions. This episode’s question comes from a listener’s text message. Here it is. “Hi. I recently got married and I’m wondering about the best way to work with our different credit cards. Is it possible or a good idea to put all of our purchases on one card and then pay off that card with another card, thereby giving us rewards on both cards? We would of course then pay off the card using a checking account to avoid carrying a balance.” To help us answer this listener’s question, we are joined by NerdWallet credit card pro Erin Hurd. Erin, welcome back to Smart Money.

Erin Hurd:

Thanks so much, Sean. Thanks for having me.

Sean Pyles:

So let’s talk about this clever idea that our listener and their spouse have. Paying off one credit card with another credit card to try to effectively double the amount of points that they could get for their purchases. Is that even possible?

Erin Hurd:

Well, I have to say it’s a very clever idea. And so I give a big hats off to this reader for thinking outside the box and also for making a plan to avoid carrying a balance upfront. Because if you’re carrying a balance on a credit card, the interest you’re going to pay will far outweigh any rewards that you’ll earn. However, unfortunately, this strategy is not possible. You cannot pay the monthly bill of one credit card using another credit card, and the rewards that you earn from credit card issuers, they come at a cost for the credit card issuers. And so they would be out of business if they were paying double rewards that way.

If the listener was carrying a balance on another credit card, it would be possible to transfer that balance to a new credit card so they could open up a new card with a 0% intro APR period on balance transfers, and then they would get some extra time to pay off that balance without paying interest. But that’s really the only way that you can essentially pay one credit card with another credit card. And I also wanted to note that you won’t earn any rewards on a balance transfer.

Sean Pyles:

In fact, there’s almost the opposite of a reward because you typically have to pay a fee for the balance transfer.

Erin Hurd:

That’s correct.

Sean Pyles:

So our listeners’ original idea won’t work out, but there are some other clever ways that couples can tag team their credit card points game. Can you talk us through some of those?

Erin Hurd:

Absolutely. I love partners working together in credit cards because two partners mean double the potential for new card signup bonuses. So if you’re thinking about a new card, it could make sense for your partner to also apply for a new card. That could be the same card, they could be different cards, but that way each of you will earn a nice signup bonus. And it can even make sense to double up on some cards that charge an annual fee, which paying double annual fees might give you a little bit of pause. But for example, some hotel credit cards, they’ll offer a free annual night certificate. So if both partners get the card, not only will they get two signup bonuses, but they’ll also get two free hotel nights a year. That way they can have a nice weekend getaway instead of just one night. They will pay two annual fees, but the cost of those two annual fees should work out to be a fraction of the value of what they would pay in cash for a free weekend away at a nice hotel.

Sean Pyles:

But I would imagine this would require the couples to be more proactively managing all of the various points and benefits that they get from their cards, right?

Erin Hurd:

Absolutely. And meeting a signup bonus is an important part of opening a new card. And so if you are not going to be able to meet the spending thresholds in order to earn those bonuses, then think twice about the cards that you’re going to open up and maybe just one card.

Sean Pyles:

So Erin, I know this is something that you and your husband do. Can you talk about how you approach this strategically with your partner?

Erin Hurd:

Absolutely. So first of all, we are going to make sure that we have enough spending coming up in our everyday expenses that we’re going to be able to meet the minimum spending requirements if we’re opening two cards. We want to make sure that we’re not spending more than we would ordinarily in order to hit those bonuses. And for people who don’t spend as much on the cards, they don’t have big expenses coming up, another way to hit a bonus quickly is that you could add your partner as an authorized user on your new card, and that way two people spending on the same account can help you hit that spending threshold a little bit more quickly.

Sean Pyles:

So someone could be an authorized user on their partner’s card even if they have the same card?

Erin Hurd:

That’s correct. And also I wanted to point out that some credit card issuers do allow you to pool points with your partner or even sometimes with other family members, and that can make it easy to amass a big stash of points that you could maybe use for a big trip. Sometimes partners can even refer each other for a new card. So sometimes I could refer my husband and if he uses my referral link to open up the card, then I will get a referral bonus and he’ll get the new card signup bonus.

Sean Pyles:

Oh, very nice, I like that. So this listener’s question got me wondering about all of the different ways that we can use our credit card points when we have accumulated them. Some cards will let you redeem your points to cover purchases or let you redeem them for items in their online stores. Some will even let you redeem your points when you’re checking out at Amazon. And I imagine that your points will go further in some places than others. So how can people determine where is the best place to use their points?

Erin Hurd:

That is such a great question, and it’s one that can be really confusing because these options are popping up more and more. And so first, let me say that your points are best spent however they’re most useful to you. So if you have a bunch of travel points but you don’t have any travel plans on the horizon, it’s okay if you choose to use them for something else, even if they’ll be less valuable. Don’t feel guilty about them. They’re your rewards. You can spend them however you want to spend them.

But if you do want to get the maximum value from your points, the first step is to have an understanding of how much these points could be worth. So when rewards are cash back rewards, they’re easy, 1 cent is worth 1 cent, but travel points can be more difficult. NerdWallet does a deep dive analysis on the current value of many top airline and hotel programs. We can link to that in the show notes, but each different kind of point or mile will be worth different amounts. And so having a basic understanding of the average current value of these points will really help you make some smart redemption decisions.

Sean Pyles:

Well, are there places where people should maybe avoid using their points?

Erin Hurd:

Yeah, so I would watch out for the options we see more and more of these days to redeem your points directly at stores. So at Amazon, for example, when you go to checkout, I’m sure you’ve probably seen the option to pay using your points. They have lots of different kinds of credit card rewards points available, and it makes it really easy. You feel like you’re getting stuff for free if you’re using points instead of actually using your real credit card, and that feels good. Getting free stuff feels good. Sometimes using your points can even be the default payment method at some of these stores without you even choosing it. So I would watch out for that. The good news is it feels like you’re getting free stuff, but the downside is that you’re often getting poor value for the points when you use them this way, unfortunately. You’re paying for the convenience and the store is betting on people not really understanding or questioning the value of your points. So for example, if you use Chase Ultimate Rewards Points at Amazon checkout, they will be worth 0.8 cents each. But those same points can be worth up to 1.5 cents each when you use them to book travel through Chase, depending on which Chase credit card you have. Or sometimes you can even get higher than 1.5 cents if you transfer them to travel partners. And so that’s a big difference there.

Sean Pyles:

Quick note that Chase is a NerdWallet partner, but that doesn’t affect how we talk about them. So Erin, you are a credit card expert. Do you have a hierarchy for maybe the best to worst ways to use your credit card points?

Erin Hurd:

So I have a lot of credit cards. I have a lot of different points in various different loyalty programs. So for me, I’m doing a lot of mental gymnastics, deciding if it’s a good deal or not when I redeem my points. But here are some of the things that I’m considering in my head when I’m deciding. So I’m thinking about the expiration. Are these points going to expire? Thankfully, most points don’t expire as long as you have the credit card still open.

Or for some of the travel points, if there’s some activity in your account every 18 to 24 months, your points won’t expire for the most part. But if you anticipate closing a card, make sure you can use all those points first, even if you’re not getting the best value. Because points in some airline and hotel programs, they can have a hard expiration date even if there is activity in the account. So that’s the first thing I would look at, are these points ever going to expire?

Sean Pyles:

And even if someone’s points won’t expire soon, it’s likely a good idea to use them sooner than later because inflation is decreasing the value of our credit card points, right?

Erin Hurd:

That’s right. Holding onto a whole bunch of points is not really a good investment strategy because you’re not earning any interest and you are definitely going to be a victim of inflation at some point or another.

Sean Pyles:

All right, so what other questions are you asking yourself as you think about what points to use where.

Erin Hurd:

I’m considering if I have a realistic use for these points in the next year or two. It can be really easy to hoard these points, even inadvertently, in order to save them up for a big trip or a big someday aspirational something. But if you’re hanging onto those points for years and years, it really just isn’t a great strategy because the points are worth money. But those points, like I said, they’re not earning any interest, they’re just gathering dust in your account, and really the travel redemption options, if that’s what you want to use your points for, those options are always changing and they’re often getting devalued, and it’s completely out of our control. And so I say it’s better to use them now even if it’s for a lesser value.

Sean Pyles:

Yeah, I recently found myself in a similar situation of inadvertently hoarding some points. I had this credit card that I took out years ago because it gave me a decent amount of points at the pump, but then I eventually stopped using that card as frequently, but I had a bunch of points racked up and they were just sitting there. I would get emails every so often from this credit card saying, “Hey, you want to use your points on something?”

So I went into their online store. When you log in, you can get random things like sunglasses or Stanley Cups or what have you. And I bought myself an Apple TV basically for the sake of using the points, but I did wonder whether I was making the most efficient or optimized use of those points. So I don’t know. I would love to hear how you think about these online storefronts that credit cards have. Do you think these are a good use of credit card points or not so much?

Erin Hurd:

It really depends. Usually they’re not the best value. Sometimes the credit card issuers will run specials where buying items with your points, and usually it’s only specific items, it’s not all the items, but maybe items that no one’s really buying, and that’s why they’re going on sale with the points. Sometimes it can be a decent deal. I’m recalling in recent memory, Chase has offered a 10% bonus on Apple products through their portal on occasion. So that can be a good use of points if you’re in the market for an Apple product anyway. But for the most part, I would say do the math, compare how many points they’re asking to the cash price, and just make sure that you’re getting a decent value.

Sean Pyles:

Any other questions that you ask yourself as you’re thinking about where to use your points?

Erin Hurd:

Yeah, especially in terms of shopping. I’m thinking about can I get more value for myself if I redeem these points for cash instead of using them for shopping? Like we’ve been discussing, some of the options to use the points at checkout are convenient, but you’re paying for that convenience. So here’s another example for you. Citibank issues Thank You Points, that’s their reward currency. And those points can be redeemed through PayPal, if you check out at PayPal, for anything that you’re buying for a rate of 0.8 cents each. Now, in most cases, those same points could be redeemed for cash at 1 cent each. So if you’re going to use them through PayPal for 0.8 cents, you might as well take the couple of extra steps and redeem them for cash and then use the cash to buy whatever you were going to buy for PayPal.

Sean Pyles:

And a quick note that Citi is also a NerdWallet partner, but again, that does not affect how we talk about them. Your example there underlines a certain skepticism that I have about all of these corporate partnerships in the credit card space. Like the PayPal Citibank collab seems like it could be a good deal for customers, but as you just outlined, it isn’t so much. So should people in general just be wary of these deals that they see between different companies or are they sometimes actually a better deal for us?

Erin Hurd:

I rarely would say that they’re a better deal. Sometimes they are as good of a deal as you could get in other circumstances, but oftentimes they’re not. So I would just really advise understanding how much your points could be worth, and if you can take that extra step to redeem them from cash and then use that cash, you’re probably going to be better off.

Sean Pyles:

All right. And as ever, ask yourself “What’s the catch?” Well Erin, thank you so much for talking with us.

Erin Hurd:

Thank you so much for having me.

Sean Pyles:

And that’s all we have for this episode. Remember, listener, that we are here for you and your money questions. So send them our way. You can call or text us on the Nerd hotline at 901-730-6373. That’s 901-730-NERD. You can also email us at [email protected]. Visit nerdwallet.com/podcast for more info on this episode. And remember to follow, rate, and review us wherever you’re getting this podcast. And remember, you can follow the show on your favorite podcast app, including Spotify, Apple Podcasts, and iHeartRadio to automatically download new episodes.

This episode was produced by Tess Vigeland. Sara Brink, the best audio editor in the world, mixed our audio, and a big thank you to NerdWallet’s editors for all their help.

Here’s our brief disclaimer. We are not financial or investment advisors. This nerdy info is provided for general educational and entertainment purposes and may not apply to your specific circumstances. And with that said, until next time, turn to the Nerds.

Source: nerdwallet.com

Apache is functioning normally

August 7, 2024 by Brett Tams

The downward movement in mortgage rates over the past few months accelerated last week as a cooler-than-expected jobs report and indications of a Federal Reserve rate cut led to a steep drop in loan pricing.

At HousingWire‘s Mortgage Rates Center on Tuesday, the 30-year conventional loan rate averaged 6.8% — a new low point for 2024 that was just below the 6.83% figure to start the year. Rates have been above 7% for much of the past six months, contributing to a tepid spring and summer of home sales, but they have steadily decreased since peaking above 7.5% in early May.

Depending on the loan scenario, originators across the country are offering even lower prices to borrowers. HousingWire interviewed several mortgage professionals on Monday who said that rates for government loans were in the high 5% to low 6% range, while those for conventional mortgages were in the low-to-mid-6s. Several reported that mortgage rates rose again on Tuesday due to weaker mortgage-backed securities prices. Quotes vary based on borrower credit scores, lender points and other factors.

On Monday, turmoil for international stock markets were received as good news for the U.S. housing and mortgage markets, even as stock prices for some major real estate and mortgage companies took a hit. Bank of America projected more than 100 basis points (bps) of rate cuts before the end of the year as the risk of a recession appears to be rising.

The recent decline in rates — and expectations for more — are fueling optimism for a potential renaissance in home purchase and refinance lending. At United Wholesale Mortgage, for example, CEO Mat Ishbia said Tuesday that the company is selling some of its mortgage servicing rights with higher coupon rates as it looks to deleverage its balance sheet and invest in origination opportunities.

The CME Group‘s FedWatch tool currently shows a 100% chance of a rate cut following next month’s Fed meeting. Sixty-three percent of analysts believe there will be a cut of 50 bps, with 37% expecting a cut of 25 bps. The federal funds rate has not moved from its current range of 5.25% to 5.5% since July 2023.

Other market observers cautioned that even though a Fed rate cut in September seems all but certain, mortgage rates don’t always move in tandem with changes in the federal funds rate.

“Mortgage rates aren’t going to change based on a Fed cut,“ Melissa Cohn, a regional vice president at William Raveis Mortgage, said in a statement. “Your home equity rate will drop. Your student loans, car loans, all those rates will drop every time the Fed cuts rates, but mortgage rates are tied to the bond market, and the bond market is more affiliated with the rate of inflation and bad economic data than it is to the Fed funds rate.”

In commentary published Monday, Moody’s analyst Nick Villa wrote that a September rate cut will not be enough to “relieve the housing affordability crisis.“

“Presumably, even with the first interest rate cut of this hiking cycle in September, the federal funds rate would still be in restrictive territory with additional cuts needed to help restore the housing market to a more balanced equilibrium,“ Villa said.

Source: housingwire.com