With several new products coming to the U.S. this year, the Visa payment network is working to propel consumers into a future where purses are lighter, pockets are emptier and payments are easier. Most notable among the company’s plans: one “credential” that gives users the option to pay with a credit card, debit card, rewards points, or a “buy now, pay later” plan.
“No one wants a thick wallet. It’s the George Constanza problem,” says Matthew Goldman, founder of the financial technology consulting firm Totavi, referencing an episode of “Seinfeld” where one character’s overstuffed wallet causes him back pain.
If you’re one of the 48% of Americans who used a digital wallet in the past 90 days, per March 2024 data from J.D. Power, you’re already experiencing technology’s wallet-slimming potential. However, merchant acceptance is still iffy, especially when it comes to small businesses. The J.D. Power 2024 Merchant Services Satisfaction Study found that only 57% of small businesses now accept digital wallets.
Still, this has been a busy spring when it comes to digital payment innovation. Just a week after Visa announced its new suite of services, Google Pay announced the launch of new features, too. The Google Pay app will now show your cards’ benefits at checkout so you can pick the one that will earn the most rewards for the purchase (for now, this is limited to American Express or Capital One cards when checking out on the Chrome browser). You’ll also be shown buy now, pay later options for more merchants than before. Plus, you can autofill details like shipping and billing information with a fingerprint, face scan or screen lock PIN.
Visa’s launch is part of a larger trend of making it effortless to make purchases. “These innovations are all designed to streamline payment actions and make it easier and safer for consumers to transact across different environments in a more consistent manner,” said Beth Robertson, managing director at Keynova, a financial services intelligence firm, in an email.
Visa’s new services
Visa is launching several new services, some of which pertain to electronic bill payments and data security. Here are the ones with the most potential to change your shopping experience:
Visa Flexible Credential
The service that might get the most notice from anyone who carts around a card-filled wallet is Visa Flexible Credential. It allows you to access multiple payment options — including debit and credit cards, loyalty points, and buy now, pay later plans — from one payment source. You can also set some parameters, like paying with debit if a purchase is below a certain amount and paying with credit if it exceeds that amount.
Tap to Everything
You’re likely already growing more accustomed to tapping your card, as opposed to dipping it into a chip reader, as merchants update their point-of-sale (POS) terminals to access contactless payments. Tap to Everything expands upon this idea, with the promise that “any device can now be a POS device,” per Visa’s news release. For instance, merchants will be able to take payments by letting consumers tap their cards to the merchant’s mobile device.
That tapping process may even translate to peer-to-peer payments, allowing “money to be sent between family and friends” in a similar way, Visa’s release notes.
You’ll also be able to tap your card to your own phone to securely add it to a digital wallet, or to add it as a payment method on a merchant’s website.
Visa Payment Passkey Service
Instead of entering passwords or one-time security codes when shopping online, Visa Payment Passkey Service allows you to use your face or fingerprint to authorize the transaction.
What will change for consumers?
These products will begin coming to the market later this year. Some details about how they’ll work are still unclear, like which cards may be eligible to use with Visa Flexible Credential. How quickly consumers adopt new ways of paying can also come down to merchant acceptance.
“I think it’s important for leading issuers to promote options like these and to educate their customers about their value,” Robertson said. She added that merchants prominently mentioning these payment options on their own websites will make them more visible to consumers.
Ultimately, these are steps toward a future where picking the right payment method for each purchase, and authenticating those purchases so your bank knows they aren’t fraudulent, will be faster and easier than ever before. According to Robertson, we’ve already seen some of these innovations elsewhere, like credit cards that offer buy now, pay later plans for eligible purchases, and your face or fingerprint being used to initiate a payment.
As consumers and merchants more fully embrace digital wallets, innovations that reduce friction during the checkout process will continue to come to the market.
“I think the physical form factor of the card is going to go away,” Goldman says. “We’ll still call them cards, I suppose.”
A term deposit, also known as a certificate of deposit (CD) or time deposit, is a low-risk, interest-bearing savings account. In most cases, term deposit holders place their funds into an account with a bank or financial institution and agree not to withdraw the funds until the maturity date (the end of the term). The funds can earn interest calculated based on the amount deposited and the term.
This guide explains what a term deposit is in more detail, including the pros and cons of term accounts.
What Is a Term Deposit or Time Deposit?
Time deposit, term deposit, or certificate of deposit (CD) are all words that refer to a particular kind of deposit account. It’s an amount of money paid into a savings account with a bank or other financial institution. The principal can earn interest over a period that can vary from a month to years. There is usually a minimum amount for the deposit, and the earned interest and principal are paid when the term ends.
One factor to consider is that the account holder usually agrees not to withdraw the funds before the term is over. However, if they do, the bank will likely charge a penalty. Yes, that’s a downside, but consider the overall picture: Term deposits typically offer higher interest rates than other savings accounts where the account holder can withdraw money at any time without penalties.
Compared to stocks and other alternative investments, term deposits are considered low-risk (they’re typically insured by the FDIC or NCUA) for up to $250,000 per account holder, per account ownership category (say, single, joint, or trust), per insured institution. For these reasons, the returns tend to be conservative vs. higher risk ways to grow your funds.
💡 Quick Tip: Tired of paying pointless bank fees? When you open a bank account online you often avoid excess charges.
How Does a Bank Use Term Deposits?
Banks and financial institutions can make money through financing. For example, they likely earn a profit by issuing home, car, and personal loans and charging interest on those financial products. Thus, banks are often in need of capital to fund the loans. Term deposits can provide locked-in capital for lending institutions.
Here’s how many bank accounts work:
• When a customer places funds in a term deposit, it’s similar to a loan to the bank. The bank will hold the funds for a set time and can use them to invest elsewhere to make a return.
• Say the bank gives the initial depositor a return of 2.00% for the use of funds in a term deposit. The bank can then use the money on deposit for a loan to a customer, charging a 6.00% interest rate for a net margin of 4.00%. Term deposits can help keep their financial operation running.
Banks want to maximize their net interest margin (net return) by offering lower interest for term deposits and charging high interest rates for loans. However, borrowers may choose a lender with the lowest interest rate, while CD account holders probably seek the highest rate of return. This dynamic keeps banks competitive.
Recommended: Understanding the Different Types of Bank Accounts
How Interest Rates Affect Term Deposits
Term deposits and saving accounts in general tend to be popular when interest rates are high. That’s because account holders can earn a high return just by stashing their money with a financial institution. When market interest rates are low, though, people are more inclined to borrow money and spend on items like homes and cars. They may know they’ll pay less interest on loans, keeping their monthly costs in check. This can stimulate the economy.
When interest rates are low (as checking account interest rates typically are), the demand for term deposits usually decreases because there are alternative investments that pay a higher return. For example, stocks, real estate, or precious metals might seem more appealing, although these are also higher risk.
The interest rate paid on a term deposit usually depends on the amount deposited and the time until maturity. A larger deposit may earn higher interest, and a deposit for a longer period of time (says, a few years vs. a few months) may also reap higher rewards.
Get up to $300 when you bank with SoFi.
Open a SoFi Checking and Savings Account with direct deposit and get up to a $300 cash bonus. Plus, get up to 4.60% APY on your cash!
Types of Term Deposits
There are two main types of term deposits: fixed deposits and recurring deposits. Here’s a closer look.
Fixed Deposits
Fixed deposits are a one-time deposit into a savings account. The funds cannot be accessed until the maturity date, and interest is paid only on maturity.
Recurring Deposits
With a recurring deposit, the account holder deposits a set amount in regular intervals until the maturity date. For example, the account holder might deposit $100 monthly for five months. Each deposit will earn less interest than the previous installment because the bank holds it for a shorter period.
In addition to these two types, you may see banks promoting different kinds of CDs, whether they vary by term length or by features (such as a penalty-free CD, meaning you aren’t charged if you withdraw funds early).
Opening a Term Deposit
To open a term deposit account, search online for the best interest rates, keeping in mind how much you want to deposit, how often, and for how long. Most banks will ask you to fill in an online application. Make sure you read and agree to the terms of the agreement. For example, check the penalties that apply if you decide to withdraw your funds early as well as the minimum amount required to earn a certain interest rate.
Closing a Term Deposit
A term deposit may close for two reasons — either the account reaches maturity or the account holder decides to end the term early. Each bank or financial institution will have different policies regarding the penalties imposed for breaking a term deposit. Read the fine print or ask a bank representative for full details.
When time deposit accounts mature, some banks automatically renew them (you may hear this worded as “rolled over” into a new account) at the current interest rate. It would be your choice to let that move ahead or indicate to the bank that you prefer to withdraw your money.
If you want to close a term deposit before the maturity date, contact your bank, and find out what you need to do and the penalties. The penalty will depend on the amount saved, the interest rate, and the term. The fee may involve the loss of some or all of interest earned. In very rare cases, your CD could lose value in this way.
Term Deposits and Inflation
Term deposits may not keep up with inflation. That is, if you lock into an account and interest rates rise over time, your money won’t earn more. You will likely still earn the same amount promised when you funded the account. Also, once tax is deducted from the interest income, returns on a fixed deposit may fall below the rate of inflation. So, while term deposits are safe investments, the interest earned can wind up being negligible. You might investigate whether high-yield accounts or stocks, for instance, are a better option.
Term Deposit Pros
What are the advantages of a term deposit versus regular high-yield savings account and other investments? Here are some important benefits:
• Term deposit accounts are low-risk.
• CDs or time deposits usually pay a fixed rate of return higher than regular savings accounts.
• The funds in a CD or deposit account are typically FDIC-insured.
• Opening several accounts with different maturity dates can allow the account holder to withdraw funds at intervals over time, accessing money without paying any penalties. This system is called laddering.
• Minimum deposit amounts are often low.
Term Deposit Cons
There are a few important disadvantages of term deposit accounts to note, including:
• Term deposits can offer lower returns than other, riskier investments.
• Term deposits and CDs usually have fixed interest rates that do not keep up with inflation.
• Account holders likely do not have access to funds for the length of the term.
• Account holders will usually pay a penalty to access funds before the maturity date.
• A term deposit could be locked in at a low interest rate at a time when interest rates are rising.
Examples of Bank Term Deposits
Here’s an example of how time deposits can shape up. Currently, Bank of America offers a Featured CD account: A 13-month Featured CD with a deposit of more than $1,000 but less than $10,000 pays 4.75% APY.
At Chase, a 9-month CD with a deposit of more than $1,000 but less than $10,000 pays 4.25% APY. If you have $100,000 or more to deposit, the APY rises to 4.75%.
Recommended: How Do You Calculate Interest on a Savings Account?
The Takeaway
Term deposits, time deposits, or CDs are conservative ways to save. Account holders place a minimum amount of money into a bank account for a set term at a fixed interest rate. The principal and interest earned can be withdrawn at maturity or rolled over into another account. If funds are withdrawn early, however, a penalty will likely be assessed.
While these accounts typically have a low interest rate, they may earn more than standard bank accounts. What’s more, their low-risk status can help some people reach their financial goals.
Interested in opening an online bank account? When you sign up for a SoFi Checking and Savings account with direct deposit, you’ll get a competitive annual percentage yield (APY), pay zero account fees, and enjoy an array of rewards, such as access to the Allpoint Network of 55,000+ fee-free ATMs globally. Qualifying accounts can even access their paycheck up to two days early.
Better banking is here with SoFi, NerdWallet’s 2024 winner for Best Checking Account Overall.* Enjoy up to 4.60% APY on SoFi Checking and Savings.
FAQ
Can you lose money in a term deposit?
Most term deposits or CDs are FDIC-insured, which means your money is safe should the bank fail. However, if you withdraw funds early, you may have to pay a penalty. In a worst-case scenario, this could mean that you receive less money than you originally invested.
Are term deposits and fixed deposits the same?
There is usually no difference between a term deposit and a fixed deposit. They both describe low-risk, interest-bearing savings accounts with maturity dates.
Do you pay tax on term deposits?
With the exception of CDs put in an IRA, any earnings on term deposits or CDs are usually subject to federal and state income taxes. The percentage depends on your overall income and tax bracket. If penalties are paid due to early withdrawal of funds, these can probably be deducted from taxes if the CD or term deposit was purchased through a tax-advantaged individual retirement account (IRA) or 401(k).
The SoFi Bank Debit Mastercard® is issued by SoFi Bank, N.A., pursuant to license by Mastercard International Incorporated and can be used everywhere Mastercard is accepted. Mastercard is a registered trademark, and the circles design is a trademark of Mastercard International Incorporated.
SoFi members with direct deposit activity can earn 4.60% annual percentage yield (APY) on savings balances (including Vaults) and 0.50% APY on checking balances. Direct Deposit means a recurring deposit of regular income to an account holder’s SoFi Checking or Savings account, including payroll, pension, or government benefit payments (e.g., Social Security), made by the account holder’s employer, payroll or benefits provider or government agency (“Direct Deposit”) via the Automated Clearing House (“ACH”) Network during a 30-day Evaluation Period (as defined below). Deposits that are not from an employer or government agency, including but not limited to check deposits, peer-to-peer transfers (e.g., transfers from PayPal, Venmo, etc.), merchant transactions (e.g., transactions from PayPal, Stripe, Square, etc.), and bank ACH funds transfers and wire transfers from external accounts, or are non-recurring in nature (e.g., IRS tax refunds), do not constitute Direct Deposit activity. There is no minimum Direct Deposit amount required to qualify for the stated interest rate.
As an alternative to direct deposit, SoFi members with Qualifying Deposits can earn 4.60% APY on savings balances (including Vaults) and 0.50% APY on checking balances. Qualifying Deposits means one or more deposits that, in the aggregate, are equal to or greater than $5,000 to an account holder’s SoFi Checking and Savings account (“Qualifying Deposits”) during a 30-day Evaluation Period (as defined below). Qualifying Deposits only include those deposits from the following eligible sources: (i) ACH transfers, (ii) inbound wire transfers, (iii) peer-to-peer transfers (i.e., external transfers from PayPal, Venmo, etc. and internal peer-to-peer transfers from a SoFi account belonging to another account holder), (iv) check deposits, (v) instant funding to your SoFi Bank Debit Card, (vi) push payments to your SoFi Bank Debit Card, and (vii) cash deposits. Qualifying Deposits do not include: (i) transfers between an account holder’s Checking account, Savings account, and/or Vaults; (ii) interest payments; (iii) bonuses issued by SoFi Bank or its affiliates; or (iv) credits, reversals, and refunds from SoFi Bank, N.A. (“SoFi Bank”) or from a merchant.
SoFi Bank shall, in its sole discretion, assess each account holder’s Direct Deposit activity and Qualifying Deposits throughout each 30-Day Evaluation Period to determine the applicability of rates and may request additional documentation for verification of eligibility. The 30-Day Evaluation Period refers to the “Start Date” and “End Date” set forth on the APY Details page of your account, which comprises a period of 30 calendar days (the “30-Day Evaluation Period”). You can access the APY Details page at any time by logging into your SoFi account on the SoFi mobile app or SoFi website and selecting either (i) Banking > Savings > Current APY or (ii) Banking > Checking > Current APY. Upon receiving a Direct Deposit or $5,000 in Qualifying Deposits to your account, you will begin earning 4.60% APY on savings balances (including Vaults) and 0.50% on checking balances on or before the following calendar day. You will continue to earn these APYs for (i) the remainder of the current 30-Day Evaluation Period and through the end of the subsequent 30-Day Evaluation Period and (ii) any following 30-day Evaluation Periods during which SoFi Bank determines you to have Direct Deposit activity or $5,000 in Qualifying Deposits without interruption.
SoFi Bank reserves the right to grant a grace period to account holders following a change in Direct Deposit activity or Qualifying Deposits activity before adjusting rates. If SoFi Bank grants you a grace period, the dates for such grace period will be reflected on the APY Details page of your account. If SoFi Bank determines that you did not have Direct Deposit activity or $5,000 in Qualifying Deposits during the current 30-day Evaluation Period and, if applicable, the grace period, then you will begin earning the rates earned by account holders without either Direct Deposit or Qualifying Deposits until you have Direct Deposit activity or $5,000 in Qualifying Deposits in a subsequent 30-Day Evaluation Period. For the avoidance of doubt, an account holder with both Direct Deposit activity and Qualifying Deposits will earn the rates earned by account holders with Direct Deposit.
Members without either Direct Deposit activity or Qualifying Deposits, as determined by SoFi Bank, during a 30-Day Evaluation Period and, if applicable, the grace period, will earn 1.20% APY on savings balances (including Vaults) and 0.50% APY on checking balances.
Interest rates are variable and subject to change at any time. These rates are current as of 10/24/2023. There is no minimum balance requirement. Additional information can be found at https://www.sofi.com/legal/banking-rate-sheet.
*Awards or rankings from NerdWallet are not indicative of future success or results. This award and its ratings are independently determined and awarded by their respective publications.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.
Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.
Eligible Chase cardholders can get rewarded this summer for fueling their vehicles, seeking fun away from home, and finding a silver screen to shield them from the heat.
From July 1 to Sept. 30, 2024, Chase Freedom Flex℠ cardholders can earn 5% cash back on up to $1,500 in combined quarterly spending at the following merchants (activation required; 1% back on all other non-bonus-category spending):
Gas stations and electric vehicle charging.
Select live entertainment.
Movie theaters.
Gas stations, EV charging and select live entertainment are repeat categories from the Q3 2023 bonus calendar. Movie theaters are an addition this year, and were previously excluded from the select live entertainment category.
Chase Freedom® and Chase Freedom Flex℠ bonus rewards categories for 2024
Q1 (Jan. 1-March 31)
Grocery stores.
Fitness clubs and gym memberships.
Self-care and spa services.
Q2 (April 1-June 30)
Select hotel bookings.*
Restaurants.
Amazon.com.
Q3 (July 1-Sept. 30)
Gas stations and EV charging.
Select live entertainment.
Movie theaters.
Q4 (Oct. 1-Dec. 31)
TBD (In 2023: PayPal; wholesale clubs; select charities).
*Includes bookings made directly with the hotel and prepaid bookings through Chase’s travel portal.
The select live entertainment category includes most things you’d buy tickets for, including sporting events, zoos and aquariums, concerts, theaters, museums, amusement parks, circuses and carnivals. You’ll also earn bonus rewards at eligible ticketing agencies. However, exclusions include bowling alleys, horse racing tracks, casinos, dance halls, clubs, and any purchases through a hotel or concierge or as part of a travel package.
Merchants excluded from the gas stations category include truck stops, boat marinas, oil and propane distributors, and home heating companies. You also won’t earn bonus rewards on home-charging equipment for your EV.
🤓Nerdy Tip
Although the original Chase Freedom® card is no longer accepting applications, existing cardholders still earn 5% cash back based on the same bonus calendar and terms for the Chase Freedom Flex℠.
Beyond the rotating quarterly categories, Chase Freedom Flex cardholders can earn an uncapped 5% cash back on travel booked through Chase; 3% back on drugstores and dining; and 1% back on all other purchases. New cardholders also qualify for the following signup bonus: Earn a $200 Bonus after you spend $500 on purchases in your first 3 months from account opening.
🤓Nerdy Tip
The Chase Freedom Flex℠ is a World Elite Mastercard and offers additional benefits, including cell phone protection and perks such as offers with Lyft, Fandango and Shoprunner, among others.
Information related to the Chase Freedom® has been collected by NerdWallet and has not been reviewed or provided by the issuer of this card.
This post may contain affiliate links, which helps us to continue providing relevant content and we receive a small commission at no cost to you. As an Amazon Associate, I earn from qualifying purchases. Please read the full disclosure here.
Do you really do need to know how much you make in a year?
When you are an hourly employee, you understand what your hourly rate is, but when you try to translate that into a weekly, monthly, or even yearly amount is may be a struggle.
That is totally fine. In this post, you are going to get the math behind exactly how much do I make per year.
All you have to do is follow a simple equation and plug in your numbers for your personal situation. The end result is you will know how much do I make per year.
Right now, there is not going to be a super fancy calculator to help you all through this. (Just kidding… We have calculators below for you!) In all honesty, though, this is something very basic for you to figure out.
You will figure how do I calculate how much I earn a year.
At the end of the post, we are going to go into detail about ways to increase how much you make per year, as well as tips to thrive on your current salary.
Calculating an Annual Salary from an Hourly Wage
When you are an hourly employee, there are many variables that can go into your annual salary or annual income. Primarily, the first variable is how many hours do you work in a given week. Next, is how many weeks do you work in the year. Finally, if you get paid time off.
For example, you may work less all year, but then in the busy season around Christmas, you might increase the number of hours you work. Or vice versa, if you are in the landscaping business, you are more likely to work more hours during the summer, and less in the winter (unless you find other jobs off-season of your main job like snow shoveling duties).
To calculate your annual wage, you need to multiply your hourly pay times by the number of hours that you work in a day.
Then, take that number and multiply it by the number of days that you work in a week. Next, take that number times the number of weeks that you work per year.
The most you can work in a year is 52 weeks. Do you know how many work days in a year you work? This answer may surprise you.
Steps to Calculate an Annual Salary from an Hourly Wage…
Write down your hourly rate (before taxes, FICA, 401k contributions, etc)
Figure out how many hours you work in a week.
Figure out how many weeks you work per year.
Hourly Rate * (weekly hours worked x weeks worked per year) = Annual Salary
– or –
Hourly Rate * weekly hours worked = Weekly Salary Weekly Salary * weeks worked per year = Annual Salary
**Either formula will get you to the right answer.**
Example #1 –
Your hourly wage is $14.26 that is before anything is taken out like FICA, taxes, insurance, or 401k contributions. In a typical work week, you work 34 hours. You receive paid time off, so you can count working 52 weeks per year.
$14.26 * (34 x 52) = $25,211.68
– or –
$14.26 * 34 = $484.84 $484.84 * 52 = $25,211.68
Example #2 –
Your hourly wage is $22.70 that is before anything is taken out like FICA, taxes, insurance, or 401k contributions. In a typical work week, you work 45 hours. You receive do not receive paid time off, so you can plan on working 48 weeks per year.
$22.70 * (45 x 48) = $49,032
– or –
$22.70 * 45 = $1,021.50 $1,021.50 * 48 = $49,032
Calculating an Hourly Wage from an Annual Salary
A lot of salaried people do not take into account how much they make per hour because they just are paid a flat salary rate. That salary is divided up by the number of paychecks over the course of the year.
You need to take your full yearly salary and divided it by the number of weeks per year, and then, divide it by the number of hours worked per day.
This will give you an estimate of your hourly pay as a salaried employee.
Steps to Calculate an Hourly Wage from an Annual Salary…
Figure out how many hours you work in a week.
Figure out how many weeks you work per year.
Write down your annual gross salary (before taxes, FICA, 401k contributions, etc)
Annual Salary / (weekly hours worked x weeks worked per year) = Hourly Wage
Example #1 –
Your annual salary before anything is taken out like FICA, taxes, insurance, or 401k contributions is $76,500. In a typical work week, you work 52 hours. You receive paid time off, so you can count on =working 52 weeks per year.
$76,500 / (55 x 52) = $26.75 per hour
Example # 2–
Your annual salary before anything is taken out like FICA, taxes, insurance, or 401k contributions is $42,800. In a typical work week, you work 45 hours. You receive do not receive paid time off, so you can plan on working 49 weeks per year.
$42,800 / (45 x 49) = $19.41 per hour when working
How to calculate how much you make a year?
As presented above, figuring how much I make per year is fairly straightforward.
A little math won’t hurt anyone. Plus it makes the money earned more real and difficult not to spend.
But, here is a calculator to help you out.
This will show you how to calculate how much you make a year.
There are two versions based on if you are starting with hourly wage or annual salary.
When budgeting your income, it is always better to underestimate how much you can make in a year.
For tax purposes, choose to overestimate your income, and then you won’t have big surprises come tax time.
Overtime can influence these numbers if you are paid time and half. In that case, run your numbers without overtime and gain just for overtime pay. Then, add those numbers together.
How much Do I Make per Year Before Taxes or After Taxes
Income taxes is one of the biggest culprits of reducing your take-home pay as well as FICA and Social Security. This is a true fact across the board with all salary ranges
The amount of taxes taken out hurts your hourly wage.
Every single tax situation is different.
On the basic level, let’s assume a 12% federal tax rate and 4% state rate. Plus a percentage is taken out for Social Security and Medicare (FICA) of 7.65%.
Thus, on average you can take out 23.65% just for taxes!!
Your gross salary is before taxes are taken out. Your net salary is when taxes are taken out.
Since every tax situation is different and varies greatly depending on your personal situation and potential deductions. Therefore, here is a great tool to help you figure out how much your net paycheck would be.
Un-Factored Costs of How Much Do I Make per Year
One factor that does not come up in this calculation is everything required for you to get to your job. In these examples, the assumption is you are getting paid for every hour that you are actually working.
However, you should take into account everything that needs to happen for you to actually get to your job.
Some examples include getting ready in the morning, driving to and from work, attending the “must-attend” social events after work, the amount of time to decompress from your day, etc.
It is important to know how much do you make after you account for those variables, because the answer may be surprising to you!
Here is an example…
Your workday is normally a 10 hour day, but you have an hour commute on each side. It takes you an hour to get ready in the morning and two hours to decompress from your day.
Thus, you have already added on an extra five hours of your workday on top of your normal 10 hour workday.
So, in essence, you are working 15 hours a day in order to be able to do your job and function as a human being.
That is much less than the 10 hours per day that you thought you were putting in.
Once you account for those variables, many people may realize the extra hours to make life bearable at their job or their commute is not worth it.
Here is a great calculator to figure out your true hourly wage.
So, they make look at changing jobs, even though they will be paid less per hour, they gain an extra three hours back in their life. Making their real workday just 12 hours. So, even though the pay is less, they are actually earning more when you account for these additional variables.
This is called time freedom.
3 Ways to Increase Income
While it is great to know how much do I make per year, it is more exciting and more enticing to actually figure out ways to increase your income.
Even better if you can find ways to increase your net worth.
By increasing the types of income sources that you have, you are going to fast-track your net worth. Then, you can look at retiring early or finally enjoy your work.
There are plenty of ways to increase your income, but we are going to focus on the ones that will make the most impact right now.
1. Ask for a Raise
Too many people are afraid to ask for a raise because they are nervous they may actually lose their job.
When in reality, if you believe that you are underpaid and overworked, then ask for a raise – especially if you do a great job!
There is no reason that you shouldn’t ask for a raise.
While your raise may not be huge, it may only be 50 cents an hour. That adds up to an extra $1,000 over the course of the year! That is still more income in your pocket than you had by not asking.
Don’t settle for the average cost of living increase that most companies typically give out; you deserve more for your continued years of work. Even worse, do not accept that getting the minimum wage increase is enough because it is just not fair. You need to find a new employer ASAP.
You work hard, so you should be paid for your hard work.
2. You Gotta Hustle (Like Another Job or Side Hustle)
In today’s society, you cannot have just a paycheck as earned income.
You must diversify your income sources to more than just trading your time for money.
You would be pleasantly surprised by the increase in TOTAL income at the end of the year.
If you want to make progress further this is something that you need to start doing today.
You can do simple side hustles, such as walking somebody else’s dogs, pet sitting, house sitting, watching somebody else’s kids, or cleaning somebody’s house. Basic skills.
It may not be a huge amount, but let’s say your side hustle made you an extra $100 a week. That right there will help increase your income over the course of the year to over $5,000!
That makes a solid difference on your bottom line.
Let’s say you want to hire out your specialized skills… You make $250-500 per gig and can handle four per month. That is an extra $1000-2500 a MONTH!
Passive income is one of the best ways to increase your income on a consistent basis. You put the hard work in upfront and then you get to reap the rewards, aka the money that flows in without you actually having to work on that. Possibilities include rental income, affiliate marketing, or online courses.
3. Start Selling Stuff
One of my good friends makes at least $500 each month by flipping kid’s toys and clothes. Yes, you read that right. She buys used clothes and toys and resells them for a profit. She has become very good at what she does and is well known in the local market for her items always being quality and at a fair price.
She is increasing her income by doing flipping stuff. It’s not a hard concept.
There are people that will go into goodwill and buy designer brand clothes with the tags still on them for a fraction of the price and flip it on Poshmark. The next day for a profit of over 900%.
I am not joking with you; you can sell things to increase your income.
And all of this selling is during your free time, so it should not take up a whole lot of your time. Maybe an extra hour a day, maybe four hours on the weekend, but would you be happy to walk away with little extra cash in your pocket.
Watch this free course on how to make money flipping stuff.
There are so many options for you to increase your income.
How to Live on what I Make per Year
These money management tips are simple to embrace.
That is because you can focus on a few key areas and not be distracted by every piece of financial advice.
Pick up one new habit and focus on building another on top of it. Slowly and surely, you are more likely to make long-term progress.
1. Spend Less
The formula for this one is the same regardless if you were making minimum wage, or if you are making over $100,000 per year.
You have to live on less than you make.
That is the simple thing. It does not matter what your situation is or how much income you make.
If you are spending more money and have greater expenses than your income, you will never get ahead. Period. You will be on a hamster wheel and living paycheck to paycheck, and for what my readers say – they don’t enjoy that life.
Also, I know many of my readers that they have broken that paycheck to paycheck cycle. They followed the Money Bliss Steps to Financial Freedom.
You need to live below your means.
2. Save more
Save for the future now; stop delaying saving for tomorrow.
Because when tomorrow comes, you are not going to feel like saving money; thus, you are not going to have any more money than you do today. Start saving.
Even if you start right now with saving 5% of your paycheck, that is a WIN!
Make sure your saving is set aside in a separate bank account. Even better, open an investment account and begin your saving journey.
If you know you are a natural spender, then save more money than the minimum of 20%. If you consistently save 20% of your paycheck by the time you retire, or maybe even sooner, you will become a millionaire.
It doesn’t matter how much you make per year if you do not prioritize saving sooner than later.
3. Set Goals
First, you will never make any progress if you do not set goals.
Yet, most people say they will start setting goals tomorrow; and tomorrow comes and no goals are set.
Carve out time to set goals in all areas of your life – personal, professional, health, wealth, family.
Create a bucket list for your long-term goals and make smaller short-term goals to make sure you reach those big goals.
As with anything in life, if you set a goal, you’re more likely to achieve it.
If you write down a goal, you have a greater probability of achieving your goal.
When it comes to your money and your finances and your income, you need to set smart financial goals.
You have to drive and decide what you want to do in your future.
If your goal is to have more time in life then you need to figure out how to make time freedom a priority. If your goal is not to work until you are 65 and afraid to learn what happens if you don’t save for retirement, then start putting money into a retirement account.
You have to put the plan together to reach your goals. Focus on taking action, not being in motion.
4. Positive Mindset
There are two ways that you can go in life:
You can control your future.
You can let your situation pass you by and let life get in the way.
It is totally up to you what you want to do, but you need to have the mindset that you choose to make the most out of this life here now, and that all starts today.
You make be wondering… what does this have to do with how much I make per year?? Well, if you are focused on that number not being enough, then you will struggle to get pay raises and increase your income.
Your mind is a powerful thing. Stay positive.
5. This is Your Journey
Lastly, this is one we tend to forget. Count your blessings.
Be grateful for what you have today as well as the opportunities in front of you.
Don’t worry about what the future holds today.
Be reminded that this is your journey with twists and turns, hills and valleys. Every step you take is guided on a path only made for you.
How Much Do I Make Per Year:
How Much Do I Make Per Hour:
One of the best ways to improve your personal finance situation is to increase your income. Here are a variety of side hustles that are very lucrative. With time and effort, you can start enjoying the lifestyle you want.
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After taking a second job as a driver for Amazon to make ends meet, this former teacher pivoted to be a successful stock trader.
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Know someone else that needs this, too? Then, please share!!
Did the post resonate with you?
More importantly, did I answer the questions you have about this topic? Let me know in the comments if I can help in some other way!
Your comments are not just welcomed; they’re an integral part of our community. Let’s continue the conversation and explore how these ideas align with your journey towards Money Bliss.
Series EE bonds, or Patriot Bonds, were initiated in 1980 as a low-risk way for Americans to save. The money invested is guaranteed to double in 20 years.
They build upon the tradition of Series E bonds, or war bonds, which were introduced by the federal government in 1941. Learn more about this savings vehicle here.
What Is a Series EE Bond?
A series EE bond is a U.S. Treasury bond. It’s considered to be a very safe investment, as it’s backed by the U.S. government. It is guaranteed to double in value in 20 years, even if the government has to add funds to it to meet that mark.
To provide some context, here’s a quick look at what bonds are and how bonds work. A bond is a debt instrument. Bonds are issued by corporations or governments in order to raise capital. The bond market is huge — much larger than the equity markets. (In 2023, the market cap of the global bond market was about $133 trillion, versus $111 trillion for the stock market.) Investors provide capital to companies and governments when they buy the bonds, effectively loaning their money to that institution.
Meanwhile, the bond issuer agrees to pay investors the capital back, along with interest, after a certain period.
There are different kinds of bonds investors can purchase, including municipal, corporate, high-yield bonds, and U.S. Treasuries. A savings bond is a type of U.S. Treasury bond, issued with the full faith and credit of the U.S. government, meaning there’s virtually no chance of losing money. Savings bonds allow the government to borrow money for various purposes while giving investors a reliable and predictable stream of interest income.
Series E bonds, which were created in 1941 to help fund the WWII effort, were replaced in 1980 with Series EE bonds, or Patriot Bonds.
💡 Quick Tip: An online bank account with SoFi can help your money earn more — up to 4.60% APY, with no minimum balance required.
How Do Series EE Bonds Work?
If you’re interested in buying bonds, here are details on how a Series EE bond works:
• Series EE bonds are electronic and can only be purchased and managed online with a TreasuryDirect account. They are available in any denomination starting at $25, up to $10,000 per person named on the bond, per calendar year.
• These bonds are guaranteed to double in value in 20 years, even if the government needs to kick in extra cash. You can hold the bond for up to 10 additional years to continue to earn interest.
• When you purchase a Series EE bond, the interest rate will be stated. Through October 31, 2024, the interest rate is 2.70%.
• Interest is earned monthly, compounding semi-annually, for up to 30 years, unless you cash it sooner.
• Series EE bonds can be cashed in (or redeemed) after 12 months, but early withdrawal can trigger a penalty of partial interest loss.
• Electronic Series EE bonds can be cashed in via the TreasuryDirect site.
• Interest earned on Series EE bonds is taxable at the federal level. Federal estate, gift, and excise taxes, as well as state estate or inheritance taxes, may also apply. If the money is used for qualified education expenses, however, you may not be subject to taxes.
• The TreasuryDirect site also makes 1099-INT statements of interest earnings available annually.
Recommended: Understanding the Yield to Maturity (YTM) Formula
Understanding Series E Bonds
The popularity of Series E bonds may have hinged largely on the patriotic call to purchase them as part of the war effort. Buying bonds served two purposes: It helped the government to raise money for the war and it also helped to keep inflation at bay as shortages threatened to push consumer prices up. Apart from that, there were other qualities that might have made a Series E saving bond attractive.
These bonds were issued at 75% of their face value and returned 2.9% interest, compounded semiannually if held to 10-year maturity. So investors were able to earn a decent rate of return on their investment.
Series E bonds were also affordable, with initial denominations ranging from $25 to $1,000. Larger denominations of $5,000 and $10,000 were added later, along with two smaller memorial denominations of $75 and $200 to commemorate the deaths of President Kennedy and President Roosevelt, respectively.
Series E bonds were redeemable at any time after two months following the date of issue. Bond purchasers could redeem them for the full face value, along with any interest earned.
Interest from Series E bonds was taxable at the federal level but exempt from state and local taxes, adding to their appeal. And because they were issued by the federal government, they were considered a safe investment.
Recommended: Understanding the Yield to Maturity (YTM) Formula
Series EE Bond Maturity Rate
The maturity rate for EE bonds depends on when they were first issued.
Here’s a table showing the maturity dates for Series EE bonds over time:
Issuing Date
Maturity Period
January – October 1980
11 years
November 1980 – April 1981
9 years
May 1981 – October 1982
8 years
November 1982 – October 1986
10 years
November 1986 – February 1993
12 years
March 1993 – April 1995
18 years
May 1995 – May 2003
17 years
After June 2003
20 years
Recommended: 13 Tips for Aggressively Saving Money
Are Series EE Bonds Right for Me?
Series EE bonds can be a convenient, low-risk way to help your money grow over time. Plus, many people like the idea of investing in America and having their investment backed by the U.S. government. However, the rate of return may not be optimal, and the bonds are typically held for quite a long time versus a short-term investment.
Here are two popular alternatives you might consider to grow your money:
Savings Accounts
A savings account is a deposit account that’s designed to hold the money you don’t plan to spend right away. You can find various types of savings accounts at traditional banks, credit unions, and online banks. Savings accounts can pay interest, though not all at the same rate.
High-yield savings accounts at online banks, for example, tend to pay much higher rates than basic savings accounts at brick-and-mortar banks. Currently, they may offer around 4.60% APY (annual percentage yield) versus 0.58% for savings accounts.
Stocks
If you’re unclear about how stocks work, they effectively represent an ownership share in a company. When you buy shares of stock, you’re buying an ownership stake in a publicly traded company. The way you make money with stock investing is by buying low and selling high. In other words, you want to purchase stocks at one price then sell them for a higher price.
Stock trading can be a more powerful way to build wealth over time versus keeping money in a savings account or buying bonds. But there’s a tradeoff since stocks tend to be much riskier than bonds or savings accounts. Buying shares of mutual funds or exchange-traded funds (ETFs), which hold a collection of different stocks as well as bonds, is one strategy for managing that risk.
Recommended: Bonds vs. CDs: What’s Smart for Your Money?
Banking With SoFi
Series EE savings bonds can be a safe way to earn a steady rate of return. However, they aren’t the only way to grow your money.
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
When should I cash in EE savings bonds?
Series EE savings bonds are optimally held for 20 years, at which point the money invested will have doubled. If you’d like to keep earning interest, you may hold the bonds for up to an additional 10 years.
How long does it take for a Series EE savings bond to mature?
Series EE savings bonds mature in 20 years. At the end of that period, the initial investment’s value will have doubled. You may hold them an additional 10 years and continue to earn interest, if you like.
Do Series EE savings bonds double after 20 years? 30 years?
Series EE savings bonds double after 20 years. If you don’t redeem them, you may continue to earn interest on them for another 10 years, for a total of 30 years.
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.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.
Tax Information: This article provides general background information only and is not intended to serve as legal or tax advice or as a substitute for legal counsel. You should consult your own attorney and/or tax advisor if you have a question requiring legal or tax advice.
*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.
Beauty may be subjective, but modern beauty standards heavily influence what many of us find aesthetically pleasing. Three-quarters of Americans (75%) agree that “pretty privilege,” or personal and professional advantages for those perceived as beautiful, is real, according to a new NerdWallet survey. And many are spending on beauty, possibly to reap those benefits.
The survey of over 2,000 U.S. adults, commissioned by NerdWallet and conducted online April 15-17, 2024, by The Harris Poll, finds that three-quarters of Americans (75%) have made beauty-related purchases for themselves, spending that includes products, services and procedures. The survey also asked Americans how they pay for beauty and how they think social media has impacted beauty spending.
Key findings
Some Americans have gone into debt for beauty spending. Of Americans who say they’ve made beauty-related purchases for themselves, 15% paid with a credit card that they didn’t pay off by the due date and 9% used “buy now, pay later” services, according to the survey.
Cosmetic procedures are a career investment for some. The survey found that 11% of Americans think cosmetic procedures are a good financial investment — they think looking better will be an asset to their career.
Many agree social media has exacerbated beauty spending. Three-quarters of Americans (75%) say social media has made beauty spending much worse, according to the survey.
Beauty spending is sometimes seen as a necessity. Nearly a third of Americans (31%) consider at least some of the beauty products and services they buy as essential in their budget, the survey found.
“Spending on beauty products and services can be fun and enjoyable, even helping shoppers feel a boost of confidence and joy. But it may also have a dark side,” says Kimberly Palmer, personal finance expert at NerdWallet. “Spending more than you can comfortably fit into your budget can lead to financial stress and, in some cases, long-term debt.”
Some beauty spenders are taking on debt
Three-quarters of Americans (75%) have made beauty-related purchases for themselves, the survey found, including products, treatments and procedures. The most popular expenses are skin care products (54%), hair products (41%) and cosmetic products (39%).
Many of these purchases were made with cash. According to the survey, 72% of Americans who purchased beauty products, treatments or services for themselves say they paid with cash or a debit card. And nearly 1 in 5 (19%) paid with savings.
Credit cards are another popular payment method for beauty-related spending. Paying with a credit card can provide more payment protection than a debit card, as well as potential rewards on spending. However, due to interest charges, this is generally only a good idea for those who pay off their balance in full by the due date, and not all beauty spenders did that. While 44% of Americans who have made beauty-related purchases for themselves say they used a credit card that they fully paid off, 15% say they used a credit card that they didn’t pay off by the due date, the survey found.
Credit card debt isn’t the only debt Americans have taken on for beauty spending. Nearly 1 in 10 Americans who have made beauty-related purchases for themselves (9%) used buy now, pay later services and 5% used a loan product from the provider of the beauty product or service.
Some beauty products and procedures are medically necessary and may allow people to use insurance and/or an HSA/FSA. (An HSA is a health savings account, and an FSA is a flexible spending account; both can be used for eligible health care costs.) For example, sunscreen may be a HSA/FSA-eligible medical expense and Botox as a treatment for chronic migraines may be covered by insurance. The survey found that 8% of Americans who have made beauty-related purchases for themselves used insurance and 5% used their HSA/FSA.
26% of Americans have paid for cosmetic procedures
More than a quarter of Americans (26%) say they’ve purchased cosmetic procedures for themselves, with the most popular (19%) being cosmetic dental procedures, like teeth straightening or whitening, according to the survey. In addition to dental work, 7% of Americans say they’ve purchased nonsurgical procedures, like Botox or dermal fillers, and 7% say they’ve purchased cosmetic surgeries, like rhinoplasty or liposuction.
Cosmetic procedures are common for some: The survey found that 11% of Americans say cosmetic procedures are normal in their social circle. Those with a household income of $100,000+ are more likely to say this — 15% say cosmetic procedures are normal in their social circle compared with 8% of those with a household income less than $100,000.
Like with beauty spending in general, the most popular way to pay for cosmetic procedures is cash or debit card (59%), followed by a credit card paid in full by the due date (39%). But some have gone into debt to pay for beauty procedures, with 14% using a credit card that they didn’t pay off in full by the due date, 10% using a loan product from the service provider and 9% using buy now, pay later services.
Taking on debt for nonessential purchases isn’t generally recommended, but more than one-tenth of Americans (11%) say cosmetic procedures are good financial investments, believing that looking better will help them get ahead in their career. This sentiment is most popular among young Americans — 17% of Gen Z (ages 18-27) and 20% of millennials (ages 28-43) see procedures as a good investment compared with 6% of Gen X (ages 44-59) and 4% of baby boomers (ages 60-78).
Some cite beauty spending as a necessity
Investment or not, going into debt for beauty spending isn’t looked at favorably by the general population. According to the survey, 4 in 5 Americans (80%) think it’s unacceptable to go into debt for beauty products or services. But this line may be blurry for some. Debt may be considered more acceptable when used to pay for necessities rather than extras and nearly a third of Americans (31%) — including 42% of women — consider at least some of the beauty products and services they buy as essential in their budget.
Social media is very good at influencing purchases, and beauty products and procedures are no exception. The survey found that three-quarters of Americans (75%) agree that social media has made beauty spending much worse. This could be due to ads and influencer marketing, or pressure to look a certain way.
The survey found that 12% of Americans feel pressured by society to spend more on beauty products and services than they would like to, and nearly a third of women (31%) wouldn’t feel comfortable going into work without wearing makeup.
How to keep beauty spending in check
If spending on beauty products and procedures is something you can afford without jeopardizing your finances, then it could fit into the 30% “wants” category in a 50/30/20 budget plan, for instance. But if you’re looking for ways to minimize such spending, here are a few tips to get started.
Save where you can on beauty products to put money away for your future. If spending on beauty is keeping you from saving enough — or saving at all —one place to start is to look at your spending and see if there are ways to cut back. Maybe you believe the serum you love is worth the money, but you’re fine getting fewer pedicures, for example. Think about what’s most important to you and adjust your spending accordingly.
“Taking time to look back at your beauty spending over the last year could lead to some surprising insight into how much you’ve been spending on products and services, perhaps without even realizing it. You might decide to make some changes going forward based on your priorities,” Palmer says.
Set boundaries with kids when it comes to beauty spending. The survey found that 57% of parents have made beauty-related purchases for their children, including skin care products (29%), hair products (27%) and nail salon treatments (21%). For younger children, you can start by setting budgets for nonessential beauty purchases and talking about your limits. For those old enough to take on part-time work, it may make sense to have them contribute or pay for beauty products that aren’t necessities, like cosmetics or manicures.
“Spending on beauty products also offers a great chance for kids to practice budgeting themselves. Giving them an allowance and encouraging them to make their own purchasing decisions gives them experience with those kinds of trade-offs,” Palmer says.
Avoid debt for nonessential procedures. Of Americans who purchased cosmetic procedures for themselves, 14% used a credit card they didn’t pay in full by the due date. Evaluating your options before swiping could save a lot of money in interest.
Some procedures are medically necessary, and if that’s the case, check out your insurance options or whether the procedure is HSA/FSA-eligible.
For procedures that aren’t medically necessary, saving up first is a good idea. Taking on high interest debt for any purchase could lead to future resentment.
“It’s easy to get swept up in trends and overspend. Just as with any big purchase, pausing to think through whether or not the treatment or procedure is actually worth the cost can help you make the best decision for you and your money,” Palmer says.
Consider your motivations for spending. More than a third of Americans who have made beauty-related purchases for themselves (36%) say the products they buy are status signifiers, and as mentioned, many Americans (75%) think pretty privilege exists, giving beautiful people real-world advantages. But it’s a good idea to think critically about why and how much you spend on beauty products.
Consider what beauty products and services you enjoy spending on and what you’re buying because it feels compulsory. Pausing to consider your motivations for your spending may help avoid buyer’s remorse.
Methodology
This survey was conducted online within the U.S. by The Harris Poll on behalf of NerdWallet from April 15-17, 2024, among 2,082 U.S. adults ages 18 and older. The sampling precision of Harris online polls is measured by using a Bayesian credible interval. For this study, the sample data is accurate to within +/- 2.5 percentage points using a 95% confidence level. For complete survey methodology, including weighting variables and subgroup sample sizes, contact [email protected].
Disclaimer
NerdWallet disclaims, expressly and impliedly, all warranties of any kind, including those of merchantability and fitness for a particular purpose or whether the article’s information is accurate, reliable or free of errors. Use or reliance on this information is at your own risk, and its completeness and accuracy are not guaranteed. The contents in this article should not be relied upon or associated with the future performance of NerdWallet or any of its affiliates or subsidiaries. Statements that are not historical facts are forward-looking statements that involve risks and uncertainties as indicated by words such as “believes,” “expects,” “estimates,” “may,” “will,” “should” or “anticipates” or similar expressions. These forward-looking statements may materially differ from NerdWallet’s presentation of information to analysts and its actual operational and financial results.
Traveling abroad can be an exhilarating adventure, especially when you’re heading to Europe. Whether you’re in the mood for an eclair or want to take in the Colosseum, making your way over to Europe involves a lot of moving parts.
That’s why travel insurance can be so beneficial. With protections such as trip delay reimbursement and coverage for lost luggage, travel insurance can help make sure your trip stays smooth.
What’s more, several plans include travel health insurance in Europe, so you can worry less about whether that hike through the Alps is a good idea.
Let’s take a look at travel insurance in Europe as well as other coverage options for your vacations.
How travel insurance works
Because a lot of thought, money and effort go into planning and taking a vacation, protecting your investments (and yourself) with travel insurance can make the difference between an enjoyable memory and a disastrous anecdote you tell at mealtimes.
Travel insurance can cover a variety of things, including:
Common types of travel insurance
Trip cancellation, trip delay, trip interruption and lost luggage insurance are all sources of protection when you travel, especially on airlines. These can reimburse you for nonrefundable expenses you miss out on due to covered delays, and may pay you back for costs you end up incurring (including lodging, meals, toiletries and clothing).
🤓Nerdy Tip
Although it’s possible to get standard health insurance for trips abroad, it’s much more common to get coverage for emergency care, which includes protections for unexpected injuries and illnesses.
Health insurance for European travel is usually included with a standard travel insurance policy, but there are plan limits and there may be deductibles.
It’s also possible to purchase medical-only travel insurance from certain providers if you aren’t interested in other trip protections.
How to choose between travel insurance companies
Before you start shopping for travel and medical insurance in Europe, evaluate the level of coverage you need based on your age, health, trip duration, destination and planned activities (some adventure sports aren’t always covered). Compare plans from different providers, paying attention to coverage, benefits and prices.
Here’s a short list of factors to consider:
The cost of the policy.
The limits of the plan.
Whether there are deductibles.
Whether the benefits are primary or secondary.
Where you’re going.
How long your trip is.
Whether you already have insurance that’ll cover you.
The types of activities you’ll be doing.
An insurance aggregator like InsureMyTrip or Squaremouth (a NerdWallet partner) can streamline your shopping experience. Be sure to also read reviews and ratings of individual travel insurance companies to get an idea of customer service and claim resolution processes.
Best plans for health insurance while traveling in Europe
To figure out the best plans for travel and health insurance in Europe, we generated quotes from multiple travel insurance companies using a test scenario. For this example, we used a 37-year-old Nevada resident traveling to Germany for 11 days with a $4,000 trip cost. Here are the winners.
1. GeoBlue
GeoBlue’s Voyager Choice medical insurance for European travel sits head and shoulders above the rest for cost, at only $28.16.
That said, there’s a reason it is so affordable. This plan offers coverage only for medical emergencies and lacks other trip protections. It is a good option if you want to supplement existing travel coverage (say via your credit card) with more medical coverage.
$1 million in medical coverage.
$0 deductible.
Offers direct billing.
No trip protections.
Pre-existing condition coverage requires that you have domestic health insurance.
Can only purchase plans up to six months in advance of your trip.
2. IMG
IMG’s iTravelInsured Travel SE’s comprehensive plan includes both trip protections and health insurance for Europe travel and rings in at just $135.36.
At this price point, it provides excellent primary coverage for medical insurance, offers rental car insurance and includes superior trip interruption reimbursement.
Travel delay reimbursement kicks in after 12 hours.
Baggage loss is capped at $250 per item and $1,500 total.
More expensive than other options.
3. Detour Insurance
The Detour Insurance @The Edge insurance plan is aptly named. Costing $86.90, the plan offers a unique inclusion for the costs of search and rescue, which can provide peace of mind if you’re participating in backcountry adventures.
$1 million limit for medical evacuation.
Coverage can be extended.
$10,000 for search and rescue.
No rental car insurance.
Pre-existing conditions not covered.
$50,000 limit for 24-hour accidental death and dismemberment (AD&D) coverage.
4. Trawick International
Trawick International’s Safe Travels Protect plan includes primary medical coverage as well as a wide range of trip protections. At $100.03, it even covers cancellations for medical reasons.
$25,000 in emergency medical coverage.
100% for both trip cancellation and trip interruption.
Medical quarantine coverage included.
$100 medical deductible.
$500 lost luggage limit (not a great fit if you are packing several valuables).
Doesn’t cover pre-existing conditions.
Other tips for travel and medical insurance in Europe
Do you have a travel credit card? Many of these cards offer complimentary travel insurance as a part of their benefits.
The plan you select may offer secondary coverage, but this matters only if you have existing insurance. In its absence, secondary coverage becomes primary.
Look at your existing health insurance policy. Some plans will provide emergency coverage for you when traveling internationally.
Which credit cards offer Europe travel insurance?
If you’re looking for insurance when traveling to Europe, you may already have it without knowing. Many travel credit cards offer complimentary travel insurance.
Available types of insurance can include rental car insurance, emergency medical insurance, trip cancellation reimbursement, lost luggage protection and trip delay insurance.
Here are some of the best credit cards for travel insurance:
Top cards with travel insurance
Chase Sapphire Preferred® Card
on Chase’s website
Chase Sapphire Reserve®
on Chase’s website
The Platinum Card® from American Express
Capital One Venture X Rewards Credit Card
Annual fee
Travel protections (not a comprehensive list)
• Trip delay: Up to $500 per ticket for delays more than 12 hours.
• Trip cancellation: Up to $10,000 per person and $20,000 per trip. Maximum benefit of $40,000 per 12-month period.
• Trip interruption: Up to $10,000 per person and $20,000 per trip. Maximum benefit of $40,000 per 12-month period.
• Baggage delay: Up to $100 per day for five days.
• Lost luggage: Up to $3,000 per passenger.
• Trip delay: Up to $500 per ticket for delays more than 6 hours.
• Trip cancellation: Up to $10,000 per person and $20,000 per trip. Maximum benefit of $40,000 per 12-month period.
• Trip interruption: Up to $10,000 per person and $20,000 per trip. Maximum benefit of $40,000 per 12-month period.
• Baggage delay: Up to $100 per day for five days.
• Lost luggage: Up to $3,000 per passenger.
• Trip delay: Up to $500 per trip for delays more than 6 hours.
• Trip cancellation: Up to $10,000 per trip. Maximum benefit of $20,000 per 12-month period.
• Trip interruption: Up to $10,000 per trip. Maximum benefit of $20,000 per 12-month period.
• Lost luggage: Up to $3,000 per passenger.
Terms apply.
• Trip delay: Up to $500 per passenger for delays more than 6 hours.
• Trip cancellation: Up to $2,000 per person for nonrefundable airline, bus, train or ferry tikets.
• Trip interruption: Up to $2,000 per person for nonrefundable airline, bus, train or ferry tikets.
• Lost or damaged luggage: Up to $3,000 per passenger.
Learn more
Terms apply.
Travel insurance for Europe recapped
Staying safe is important during your trip to Europe. Health insurance for travel can make a difference, especially if you’re planning on doing anything adventurous. The same can be said for other trip protections, which reimburse you for covered expenses that you incur.
To view rates and fees of The Platinum Card® from American Express, see this page.
Insurance Benefit: Trip Delay Insurance
Up to $500 per Covered Trip that is delayed for more than 6 hours; and 2 claims per Eligible Card per 12 consecutive month period.
Eligibility and Benefit level varies by Card. Terms, Conditions and Limitations Apply.
Underwritten by New Hampshire Insurance Company, an AIG Company.
Insurance Benefit: Trip Cancellation and Interruption Insurance
The maximum benefit amount for Trip Cancellation and Interruption Insurance is $10,000 per Covered Trip and $20,000 per Eligible Card per 12 consecutive month period.
Eligibility and Benefit level varies by Card. Terms, Conditions and Limitations Apply.
Underwritten by New Hampshire Insurance Company, an AIG Company.
Insurance Benefit: Baggage Insurance Plan
Baggage Insurance Plan coverage can be in effect for Covered Persons for eligible lost, damaged, or stolen Baggage during their travel on a Common Carrier Vehicle (e.g., plane, train, ship, or bus) when the Entire Fare for a ticket for the trip (one-way or round-trip) is charged to an Eligible Card. Coverage can be provided for up to $2,000 for checked Baggage and up to a combined maximum of $3,000 for checked and carry-on Baggage, in excess of coverage provided by the Common Carrier. The coverage is also subject to a $3,000 aggregate limit per Covered Trip. For New York State residents, there is a $2,000 per bag/suitcase limit for each Covered Person with a $10,000 aggregate maximum for all Covered Persons per Covered Trip.
Eligibility and Benefit level varies by Card. Terms, Conditions and Limitations Apply.
Constantly feeling tired and lazy? There might be more than meets the eye. One Reddit user shared with the Reddit community how she struggled with extreme laziness and how she didn’t want to do anything with her life—even the simplest things.
Here’s an excerpt of the OP’s problem:
“I (32f) am the laziest person I know. It’s a huge problem and I know I need to fix it. I just don’t know how. Aside from relying on motivation (which I don’t have) to get me off my a-, I have no idea what I’m meant to do.
“I’ve always been this way, for as long as I can remember. As a kid/teen my parents would refuse to come into my room because it was such a mess. They would eventually force me to clean it up. After it was all clean, my mum would say to me, ‘Doesn’t it feel good to have a tidy room and actually have accomplished something?’. But I would never feel ‘good’ for having done it, just exhausted from the effort.
I think that’s part of the issue; I have never got a ‘good feeling’ from finishing or accomplishing something. Not from small things, like cleaning or meeting gym goals or work targets, etc. Not even for big things, like scoring 97% in an exam or getting a new job. It just doesn’t happen for me. I don’t know if I’m the weird one or if my mum exaggerated this ‘good feeling’ that people get but I have no clue what it’s even supposed to feel like.
“And my laziness just keeps getting worse. I’ve lost out on money (that I can’t really afford to lose) by not returning clothes that don’t fit because going back to the shop is too much effort. Once I ordered something online that got rerouted to a collection point (less than a 10 minute walk from my house). It was non refundable. I never collected it. Picking it up was too much effort so I just accepted that I would lose the money. I have wasted money on takeout when I have food in the fridge because I can’t be bothered cooking. I’ve bought disposable plates because I have no clean ones left but I’m too lazy to do the dishes.”
Is it just the lack of motivation, discipline, and accountability, or is it more than that? Here’s what the Reddit community says!
1. Executive Dysfunction
Photo Credit: Shutterstock.
One person said, “Sounds like executive dysfunction, which is super common with depression, anxiety, and ADHD. You may wanna get checked out if you can.”
The second person replied, “Came to say this: OP, get evaluated ASAP. I identify with so much of what you said and recently found out I had ADHD. I’ve done a 180 since beginning treatment involving both behavioral aspects and meds. It’s taking time to build the habits, but it’s a totally different worldview now.”
Then somebody else agreed who also feel the same, “This. It’s usually not just laziness. I feel ‘lazy’ when I’m off ADHD meds.”
2. See if You Have ADHD or Ptsd
Photo Credit: Shutterstock.
Somebody commented with some helpful tips to help OP, “You might also want to look into ADHD or PTSD. Both can lead to this awful feeling of WANTING to do things but feeling unmotivated, even if you think they are things that will bring joy. Here are a couple tricks I use:
“Sometimes I try to do something in an odd way to get a bit of dopamine (I’m going to hop to the kitchen or stand up and pat my head three times, etc. to jolt myself out of those periods where I’m ‘stuck’.
“I also gamify things (loads of digital apps and websites like Chore Wars) or I write a list of tasks on a loot box (I play DD and you can get mini figure loot boxes, I find it has to be something I’m excited about but don’t know what’s in it, so loot boxes are perfect). If I do all the things on the list, I get the loot box.
“I’ve also been working on mindfulness, just focusing deeply on the action at the moment and not how overwhelming the whole action is. As a messy person, I’ve had to ask for help getting my space to ground zero, and now I work on it. When I leave a room, I challenge myself to clean the space I left in 20 seconds.
“Since you like books, try audiobooks while you do chores. Assign a book to each chore. Only way to get further in the book is to do the chore. Do the things that should bring you joy, even if they don’t until they do. I read that in an ADHD book, its frustrating when things we love don’t bring us joy. But the advice is to do it anyway, and eventually, that joy comes back.
“Get an occupational therapist. Mine was cheap and gave me lots of tricks to manage this stuff and also I had to call him and be accountable each week. If you can’t afford that, set up a weekly call with a family member where you discuss your goals and are held accountable.
“Finally, involve other people! Sign up for a class in the mornings so the guilt motivates you to go. Schedule a weekly morning walk with a friend. Let your family know you are overwhelmed and stuck and ask if they can come over to help you reset your space. Hope something here helped.”
3. The Secret Is Discipline and Consistency
Photo Credit: Shutterstock.
“Motivation only carries so far. You need discipline and consistency. I know this because I have the same problem. Set schedules for things; I study at 7 am, work out at 8, work, practice guitar, etc. Some days you really won’t want to but getting into the habit is important.
“There are two options: either you are content with your lifestyle and won’t change it, or you’re so unhappy that you are willing to do anything to change it. Figure that part out and the rest will come together,” shared somebody.
“This much executive dysfunction sounds extreme for a willpower problem; it might be a medical thing,” replied another.
“She won’t have discipline for things she absolutely doesn’t care about. I can be a bit lazy but I still make my bed or wash my sheets or floor because I love the way it looks and feels. She feels no joy from it and should probably look into why she gets no joy or satisfaction from having a clean room, etc.; that’s not really normal and possible depression,” added another with a different view.
4. Get Yourself Checked or Get Out of Your Comfort Zone
Photo Credit: Shutterstock.
Somebody commented, “Many people who have chronic depression, autism, or ADHD show signs of ‘laziness’—you mention you suffered depression previously and know what it feels like, then you went on to mention your mood. Do you realize that depression often has no mood-related symptoms? It doesn’t feel ‘sad’ oftentimes. It feels like exhaustion and laziness—exactly what you described. However, if you’re unwilling to even entertain the idea, then look into autism and ADHD instead.
“Another factor is need. People are capable of incredible things when necessitated, but if you’re comfortable and the people around you have allowed you not to do things that require significant effort, then you likely have no reason to push yourself. If you feel the issue isn’t related to an illness or disorder, then get out of your comfort zone and put yourself in an uneasy situation.”
5. Start Small Until It Becomes a Habit
Photo Credit: Shutterstock.
“I am in the same boat. Here is what I try to do: (1) I do 1 task I don’t like per day. Don’t try to do them all on the same day. (2) Basic hygiene is very important should be done everyday. (3) I try to give myself rewards on Monday and Friday. Monday would be like buying myself a really good coffee before work and on Friday I would be eating out instead of making a lunch.
“I can talk to you about depression, discipline, and all that. But all of those never stuck in my brain. The answer is to start small and keep track of what you do. I like to make a to do list and just looking at the end of the week and what I have accomplished motivates me to do more. I think we are not made to find happiness every day or in everything we do. So need to take it when we can,” shared somebody.
“I second this! Start slow. Pick one section of your house, the bathroom, the living room, and just clean that section only. Set a timer and see how much you can do in 5-10 minutes, then reward yourself with TV or a snack. The next day, another 5-10 minutes. Make a list, cross things off. It’s not easy, but please be kind to yourself. You may not be depressed, but the drudgery of life can definitely get to you,” agreed the second person.
6. It’s Not Your Identity
Photo Credit: Shutterstock.
One user said, “First, and most importantly, stop using it as an identity marker. This goes for anything you want to overcome. When you say, ‘I am lazy,’ your mind reinforces that identity. Instead, say, ‘I’m working my lazy behavior. See how the language separates you from it? Even better, say something like, ‘I’m working on getting more things done.’ That’s more positive and affirming, and it focuses your mind in that direction.”
7. Start With the Two-Minute Rule
Photo Credit: Shutterstock.
“Start with the 2-minute rule. As soon as you think of something you need to do that takes 2 minutes or less, you top what you are doing and get it done. Don’t wait for the TV commercials, don’t wait for the YouTube video you’re watching to end, just do it. This will start to strengthen your self-control,” stated somebody.
8. Set a Timer for 20 Minutes
Photo Credit: Shutterstock.
Somebody said, “I set a timer for 20 minutes every night. I then challenge myself to see how much I can clean. When you first start, it may feel like you’re not accomplishing much but eventually you’ll find yourself searching for things to clean.”
9. Put Yourself in a “Swim or Sink” Situation
Photo Credit: Shutterstock.
“Put yourself in a ‘sink or swim’ situation … I was never really ‘lazy’ per se but when my parents kicked me out at 26 for doing fraud with their credit cards I had to make it on my own. I slept in my old a- truck with an expired registration at night, took my showers in a gym, and survived mostly on microwaved food at convenience stores. I had to work my a- off to get to where I’m at now. I’m a homeowner, have paid off two vehicles since then and I still work two jobs and consistently save and invest portions of my income,” shared somebody.
10. Get Yourself Accountable
Photo Credit: Shutterstock.
Somebody said, “You behave the way you do because you’ve not yet encountered a consequence important enough for you to behave differently. It sounds like no one or nothing in your life is holding you accountable to behave differently, and you’re not choosing to hold yourself accountable, so I don’t think you’re going to change. If you were well and truly disgusted with your own behavior, you would change it.”
What do you think the OP should do? Have you struggled with the same? Let us know in the comments!
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Source: Reddit
10 Actors Perfectly Cast for Their Character Roles
Photo Credit: Warner Bros.
Have you ever watched a movie or show and been completely lost in it because of how well an actor or actress became their character? Check out this article for a whole list of actors who were perfectly cast!
11 Vampire Movies That Will Make You Thirst for More
Photo Credit: Columbia Pictures.
You know that feeling where you’re on a movie kick in a certain genre, but you seem to run out of good movies to watch? Well, if you’re down for a vampire movie or three, check out this article for the best ones out there!
10 Incredible Movies That People Rated 10 Out of 10
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It’s pretty hard to replicate the experience of watching your favorite movie for the first time, but we’ve put together a list of movies that people have rated at a perfect 10/10. Next time you need a good movie to watch, check this out!
10 Famous People Who Canceled Themselves With Their Own Stupidity
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We’ve all been there: you make a comment you haven’t thought through at all, and the whole room goes silent at what you’ve just said. But can you imagine doing that as a famous person—and getting canceled? Check out this list of celebrities who did just that!
13 Things You Shouldn’t Do When You’re in the US
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Are you planning a trip to the US? Culture varies a lot between countries, even countries that share borders. So if you’re headed to the good old U. S. of A, here are a few pointers to make your travels go more smoothly!
Some credit cards offer a promotional interest rate, as low as 0% APR, for purchases and/or balance transfers. Often, these promotional interest rates are offered for a limited period of time when you apply for a new card, though some issuers offer promotional rates for existing cardholders as well.
If you have a large purchase coming up, or an existing credit card balance that you want to transfer over, these cards can save you a significant amount of interest. You’ll just want to make sure to pay off the full balance by the end of the promotional period, as your interest rate will likely jump significantly when your promotional APR expires.
What Are Credit Card Promotional Interest Rates?
A credit card promotional interest rate is an interest rate that is offered for a limited amount of time, as a promotion. During the promotional period, you’ll be charged a lower interest rate than your typical interest rate.
It’s common for credit cards to offer these introductory promotional interest rates for new members when you open a credit card account. However, it’s also possible for issuers to offer promotional interest rates to existing cardholders.
Recommended: How to Avoid Interest On a Credit Card
How Credit Card Promotional Interest Rates Work
One common scenario for how credit card promotional interest rates work is that an issuer might offer a 0% promotional interest rate on purchases and/or balance transfers for a certain period of time. When you’re using a credit card during the promotional interest period, you won’t pay any interest.
It’s important to note that there are two major types of promotional interest rates, and they vary slightly. With a 0% interest promotion, you won’t pay any interest during the promotional period. If there’s any balance remaining at the end of the promotional period, you’ll begin paying interest at that time. With a deferred interest promotional rate, on the other hand, you’ll pay interest on any outstanding balance back to the date of the initial purchase.
Benefits of Credit Card Promotional Rates
As you may have guessed, there are certainly upsides to taking advantage of credit card promotional interest rates. Here’s a look at the major benefits.
Low Interest Rate During the Promotional Period
One benefit of credit card promotional interest rates is the ability to take advantage of a low or even 0% interest rate during the promotional period. Having access to these promotional rates can give you added flexibility as you plan your financial future.
Ability to Make Balance Transfers
One possibility to maximize a credit card promotional rate is if you have existing consumer debt like a credit card balance. By using a balance transfer promotional interest rate, you can transfer your existing balance and save on interest. This can help lower the amount of time it takes to pay off your debt.
Can Pay For a Large Purchase Over Time
If your credit card has a 0% promotional interest rate on purchases, you can take advantage of that to pay for a large purchase over time. That way, you can spread out the cost of a large purchase over several months rather than needing to pay it off within one billing period.
Just make sure to pay your purchase off completely before the end of the promotional period to avoid paying any interest.
Drawbacks of Credit Card Promotional Rates
There are downsides to these offers to consider as well. Specifically, here are the drawbacks of credit card promotional interest rates.
Deferred Interest
You need to be careful if your credit card promotional rate is a deferred interest rate, rather than a 0% interest rate. Because of how credit cards work with a deferred interest rate promotion, you’ll pay interest on any outstanding balance at the end of the promotional period — back to the date of the initial purchase. This amount will get added to your existing balance, driving it higher.
Penalty Interest Rates
You still have to make the minimum monthly payment on your credit card during the promotional period. If you don’t make your regularly scheduled payment, the issuer may cancel your promotional interest rate. They may even impose an additional credit card penalty interest rate that’s higher than the standard interest rate on your card.
May Encourage Poor Spending Habits
Establishing good saving habits and living within your means is an important financial concept to live by. While it may not always be possible, it’s generally considered a good idea to save up your money before making a purchase. While a 0% interest promotional rate means you won’t pay any interest, it can contribute to a mindset of buying things you don’t truly need.
Recommended: Tips for Using a Credit Card Responsibly
How Long Do Credit Card Promotional Interest Rates Last?
By law, credit card promotional interest rates must last at least six months, but it is common for them to last longer. You may see introductory interest rates lasting 12 to 21 months, or even longer.
Regardless of how long your promotional period lasts, make sure you have a plan to pay your balance off in full by the end of it. Credit card purchase interest charges will kick in once your promotional period is over.
Zero Interest vs Deferred Interest Promotions
Both 0% interest rates and deferred interest rates are different kinds of promotional rates where you don’t pay any interest during the promotional period. However, they come with some key differences:
Zero Interest
Deferred Interest
Often marketed with terms like “0% intro APR for 21 months””
Often marketed as “No interest if paid in full in 6 months”
No interest charged during the promotional period
No interest charged during the promotional period
Interest charged on any outstanding balance starting at the end of the promotional period
At the end of the promotional period, interest is charged on any outstanding balance, back-dated to the date of the initial purchase
What to Consider When Getting a Card With a Zero-Interest or Deferred Interest Promotion
One of the top credit card rules is to make sure you pay off your credit card balance in full, each and every month. But if you’re carrying a balance with a promotional credit card rate, you’ll want to make sure you understand if it’s a 0% rate or a deferred interest promotion.
With a 0% promotional rate, you’ll start paying interest on any balance at the end of the promo period. But with a deferred interest promotional rate, you’ll pay interest on any balance, back-dated to the date of the initial purchase.
In either case, the best option is to make sure that you have a plan in place to pay off the balance by the end of the promotional period.
Paying off Balances With Promotional Rates
You’ll want to have a gameplan for how to pay off your balance before the end of the promotional period. That’s because at the end of the promotional period, your credit card interest rate will increase significantly.
If you still are carrying a balance, you will have to start paying interest on the balance. And if you were under a deferred interest promotional rate, that interest will be calculated back from the initial date of purchase.
Watch Out for High Post-Promotional APRs
Using a 0% promotional interest rate can seem like an attractive option, but it can lull you into a false sense of financial security. You should always be aware that the 0% interest rate won’t last forever. Your interest rate will go up at the end of the promotional period, and if you’re still carrying a credit card balance, you’ll start paying interest on the balance.
Exploring Other Credit Card Options
There are some other credit card options besides getting a card with a promotional interest rate. For instance, you might look for a credit card that offers cash back or other credit card rewards with each purchase.
Before focusing on credit card rewards or cash back, however, you’ll want to make sure that you first focus on paying off your balance. Otherwise, the interest that you pay each month will more than offset any rewards you earn.
If you’re carrying a balance, you can also attempt to get a good credit card APR by making on-time payments and asking your issuer to lower your interest rate. By simply securing a good APR, you won’t have to worry about it expiring and then spiking like you would with a promotional APR.
The Takeaway
Some credit cards offer promotional interest rates to new and/or existing cardholders. These promotional interest rates could be a 0% interest rate for a specific period of time, or a lower interest rate to encourage balance transfers.
While taking advantage of promotional interest rates can be a savvy financial move if you have existing consumer debt or need to make a large purchase, you’ll want to make sure you have a plan to pay off your balance in full before the promotional period ends. That way, you avoid having to pay any interest.
Whether you’re looking to build credit, apply for a new credit card, or save money with the cards you have, it’s important to understand the options that are best for you. Learn more about credit cards by exploring this credit card guide.
FAQ
Will my interest rate spike after a promotional deal ends?
Yes, generally credit card promotional interest rates last only for a specific number of months. The way credit cards work is to charge interest on balances that are not paid off. So, while your credit card may charge 0% or a lower promotional rate for a period of time, the interest rate will rise once the promotional period is over and will apply to any outstanding balance on the card.
How does promo APR work?
Promotional APR offers are generally put forward by credit card companies as a way to entice new applicants. Cards may offer a 0% introductory APR for a certain number of months on purchases and/or balance transfers. Once the promotional period is over, your interest rate will rise to its normal level.
Should you close a credit card with a high interest rate?
Having a credit card with a high interest rate will not negatively impact your credit or your finances if you’re not carrying a balance. So, simply having a high interest rate is not a reason, in and of itself, to close a credit card. But if you have a balance on a credit card with a high interest rate, you might want to consider doing a balance transfer to a card with a promotional 0% interest rate while you work to pay it off.
Is my credit card’s promotional rate too good to be true?
Promotional interest rates are a legitimate marketing strategy used by many credit card companies. While you shouldn’t treat them as a scam, you also need to make sure that you are aware of the terms of the promotional rate and how long the rate is good for. Make a plan to completely pay off your balance by the end of the promotional period before your interest rate increases.
Photo credit: iStock/Jakkapan Sookjaroen
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.
Inside: Learn how to save $5000 in 6 months by following these easy, useful tips. Get a head start on saving for your money goals and save more.
It is no secret that saving money for the future has never been more important.
The Recession of 2008-2009 and the upheaval in 2020 brought a significant increase in how we think about long-term investing, retirement readiness, and the importance of saving for emergencies.
Savings is not easy, and it takes time to save up for your dream future. Saving can seem frustrating at times with all the forms of fees and interest rates.
But saving even a little bit each month will go a long way so don’t give up!
While these are often looked at as individual or personal concerns, they can easily be translated into family finances with some simple changes to your spending habits.
Save $5,000 in six months requires a little bit of discipline, some careful planning, and actual execution.
While it is possible to save money without any difficulty, some additional effort can help make this goal much more attainable.
If you are looking for ways to save money, this post has quick tips that should help you cut down on spending while still getting your needs met.
We will give you seven simple steps that anyone can follow in order to start saving more money today so they have enough saved for their desires.
How to save $5,000 in 6 months
If you are looking to save $5,000 in 6 months, it is important to set a specific goal for yourself.
For example, if you want to save $1,000 per month, write down that goal in your calendar or on paper. Another option is to save more upfront and less throughout or vice versa.
To save $5,000 in a year, there are only 7 easy steps to follow.
You just have to commit to the money saving plan.
This post may contain affiliate links, which helps us to continue providing relevant content and we receive a small commission at no cost to you. As an Amazon Associate, I earn from qualifying purchases. Please read the full disclosure here.
1. Why Save $5,000?
Saving money is a lot easier than you think.
I’ve seen it happen time and time again: people make the mistake of thinking that saving money will be difficult or take too long, but they often realize how wrong they were once they start making progress.
To keep your motivation moving forward, you need to decide why are you starting to save money. What are the exact reasons for saving 5000 in 6 months?
Action Step: Write down your reason for saving $5k in 6 months.
2. Designate a Separate Bank Account
Next, you have a plan of where you want the money to go. You cannot just assume you will leave it alone in your checking account or won’t touch the case..
Put all your extra income in a separate bank account. If you have extra money at the end of the month, roll it over and put it in savings.
Action Step: Open a separate bank account.
3. Review Your Budget
Next, you need to review your budget for the last month. Take note of the expenses that are missing from this month’s plan.
You must be spending less than you make.
Since you are adding a saving goal of 5000, you must spend less than your current expenses plus your monthly saving goal.
Look for expenses to cut; if needed, you can drastically cut expenses.
Now, make your new budget based on this month’s income, saving goal, and expenses. You can use this budget to calculate your monthly spending plan for the next month!
Action Step: Create a new zero based budget based on this month’s income and expenses with a priority to your saving goals.
4. Set Goals
You need to set goals on how fast you are going to save money. You need set time deadlines and protect that money for this saving challenge.
Other goals you need to set include:
How to reduce expenses
How to increase income
You can make progress much faster by kicking off your saving period with a no spend month.
Action Step: Create your money goals to make saving 5000 in 6 months actually happen.
5. Create Your Action Plan
You need to find ways to save at least $500 per month. That happens one of two ways – either reduce spending or increase income.
Now, you must decide are you going to save money when you get paid or whatever is left at the end of the month.
Regardless of what you choose, you must stick to your action plan. Period.
The recommendation is to save a determined dollar amount each time you are paid. At the end of the month, if you have money left over, then you can save the extra amount.
Below we will list specific tips and examples of ways to save more money.
Action Step: Write out how you plan to save money. Don’t just keep the plan in your head. Actually, write it and post it somewhere you see it often.
Many people prefer one of these challenges to save $5k:
6. Make Periodic Transfers to Savings Account
In order to be successful, you must actually move the money to another account.
On payday or a certain day of the month, you need to deposit money into your designated $5k bank account to complete this challenge.
This is something you need to set up in advance!
Action Step: Make it a habit to make transfers to that saving account. That is how you consistently save money and not spend it. Build good habits.
7. Reward Success
Keep yourself motivated with a celebration.
It’s a “treat” that should not cost a lot of money.
Reward success for creating the proper money habits just like rewarding your kids for doing well at school. It’s important to make sure that you are rewarding the right things, and not just because it feels good.
You can earn a reward for every month that you stay on track to save $5,000 in a year.
You will be happier and more motivated to complete the $5000 saving challenge. In addition, it will keep you saving money and increasing your saving percentage each year.
This is exactly how to make saving money always fun!
Action Step: Select your rewards for each month of completing the transfer of money! This is your reward for sticking to saving 5000 in 6 months.
Bonus Tip – Tell Others for Accountability
Tell a close family member or friend about your money goal. They are the people closest to you and help build support for your cause.
You need to be on the same page with your spouse or partner. So, make sure that you are aiming and wanting to achieve the same savings goals.
How can I save 5000 fast?
You are ready to start saving money fast.
But the reality is not everyone has that extra money at their disposal (especially right now). What are some things you will need to get started on this challenge?
Saving 5000 in 6 months is possible by simply following these steps:
-Save $193.00 per week.
-Pay off your debts each time they come due, including all credit card and loan balances. This will make sure you don’t stop your money saving plan.
-Save $500.00 each month for a total of $6,000.
-Shred old receipts and throw away your bank statement to avoid seeing your balance.
-Use your savings to buy a mutual fund that will provide an average annual return of 5% over the next year.
Tips to Save 5000 in 6 Months:
Saving money is hard. It is not easy to find ways that are both quick and easy, but also useful in the long run.
That said if you’re struggling with your finances these days I have got a handful of quick-and-easy tips for saving thousands of dollars each year without much effort at all!
Just think about how many times a day you might be tempted by an impulse purchase or two.
You probably don’t make them every time because it would cost too much. But if you start thinking about these small purchases as a cost of living, it’s easy to see how the little things add up, and why saving money is so important.
Reduces expenses by $500 each month.
Increase income with overtime, find a side hustle or a 2nd job to make an additional $500 a month.
Limit Groceries Costs: Cancel food delivery service, resume weekly meal prep, and limit store visits.
Transportation: Consolidate trips, limit toll lane usage and take the free buses instead of Uber.
Memberships: Canceled unused memberships and subscriptions.
Credit card rewards: Redeem credit card rewards to help fund the things you cut from your budget or items for reward milestones.
Limit Impulse Purchases: Wait 24 hours before buying things.
Stop Getting Takeout Foods: Cook at home and save the difference.
Review Bills: Review bills and see if you can change plans or save money. There are many areas to look at, such as insurance plans, cell phone plan or other expenses. See if there are cheaper alternatives out there with better services for your family.
Sell Extra Stuff: Sell off extra things you no longer need and make a little bit of pocket money. You can sell your old clothes, shoes, books, games consoles or other items on sites like Amazon or Craigslist to earn some extra cash.
Side Gig Ideas: Side gigs can help you meet your savings goals. You might be able to make $5,000 or more in 6 months by doing something you are already doing. There are easy ways to earn a few extra dollars per day, so save up your money and get started today!
Start Investing: While you won’t make money fast, you will be making money on your money. That is called passive income and something everyone needs to learn. Start investing with this easy to follow course.
How to Save 5k in 6 months Chart
This chart provides a quick, easy, and useful guide for saving 5000. There are many ways to save 5000 in 6 months.
By Month – Same Amount
Total
Month 1
$834
$834
Month 2
$834
$1,668
Month 3
$833
$2,501
Month 4
$833
$3,334
Month 5
$833
$4,167
Month 6
$833
$5,000
This is how you can save up to be debt free or have a rainy day fund or larger emergency fund.
By Month – Lump Sum Amount
Total
Month 1
$1,500
$1,500
Month 2
$500
$2,000
Month 3
$500
$2,500
Month 4
$1,500
$4,000
Month 5
$500
$4,500
Month 6
$500
$5,000
Find more money saving charts.
How to save 5000 in 6 Months Bi Weekly?
Have you ever thought about how to save money, but all of the saving advice is based on month? Do you know what the best ways are or do not know where to start?
This is how to save 5000 in 6 months bi-weekly income.
Since you will be paid 13 times over the 6-month time period, you would have to save $385 from each biweekly paycheck.
How to save $5000 in 6 Months Bi Weekly?
Total
Week 1
$385
$385
Week 3
$385
$770
Week 5
$385
$1,155
Week 7
$385
$1,540
Week 9
$385
$1,925
Week 11
$385
$2,310
Week 13
$385
$2,695
Week 15
$385
$3,080
Week 17
$385
$3,465
Week 19
$385
$3,850
Week 21
$385
$4,235
Week 23
$385
$4,620
Week 25
$380
$5,000
All of the other steps apply to make this saving challenge happen.
How can I save $5,000 in 6 Months with Envelopes?
The 100 day envelope challenge is super popular right now.
To save $5,000 in 6 months with envelopes, you have one of two options either to save daily or weekly with a random drawing of an envelope.
Consistent Amounts Weekly Envelope to Save $5000:
Write the numbers 1-26 on each envelope.
For each envelope, you will save $193.
If you prefer to round to a flat $200 each week, you will save $5,200 or an extra two hundred dollars.
Various Amounts Weekly Envelope to Save $5040:
Write the numbers 1-26 on each envelope.
Envelope #1 you save $70.
On each envelope, you add another $10 to the previous amount. (Envelope #2 = $80, Envelope #3 = $90, etc)
On envelopes #24, 25, and 26, you save $300 those weeks
Don’t lose your envelopes!
How can I save $5,000 in 3 months?
Feeling a little bit more ambitious! That is great!
The 100 day money saving envelope challenge saves exactly $5,000. The idea is to save $100 every day for 100 days and then spend the saved amount in one month on whatever you need or want.
Learn more about the 100 day money challenge.
However, this is not feasible for many people because it takes a lot of discipline to do that consistently.
How to Save 5000 in 6 Months Calculator
A calculator helps a person figure out how much they can save in six months.
You know your income and expenses. Grab our free budget sheet and a calculator to figure out how much money you can save.
Saving $5,000 under 6 months is not attainable for everyone because some people will give up after 3 months when they realize how much sacrifice was involved with their savings plan.
That is where you need to stay strong and realize that even accomplishing 30% or 70% of your goal is more than doing nothing and saving zero dollars!
What will your life be like if you reach that goal?
Motivating yourself through small goals is easier when the reason why you’re saving is clear. Talk with family or friends about your reasons for wanting to save more and what it means to you.
More than likely at the end of saving 5000 in 6 months, you have done one of the following:
Whatever your goal is, that is the reason to stay motivated!
Update your progress on saving by sharing monthly updates of your savings progress as well as any important financial news that could inspire others!
Time to Save 5000 in 6 Months
The best way to save $5,000 in 2021 is to live below your means by not spending more than you earn.
Saving money is a great first step, but the next step is to invest your money.
Investing in the stock market is a good way to make sure your savings will grow and you can also take advantage of compounding interest.
This post provides seven quick tips for getting started with your savings goals in no more than 30 minutes a day over the course of six months (which adds up to about $500).
Are you up for the $5k money challenge?
Know someone else that needs this, too? Then, please share!!
Did the post resonate with you?
More importantly, did I answer the questions you have about this topic? Let me know in the comments if I can help in some other way!
Your comments are not just welcomed; they’re an integral part of our community. Let’s continue the conversation and explore how these ideas align with your journey towards Money Bliss.