This article originally appeared on The Financially Independent Millennial and was republished with permission.
The views and opinions expressed in this article are those of the author only and are not endorsed by Credit.com.
Investors nearing retirement have different needs than investors with many years remaining in the workforce. Retiring means losing the regular paycheck from work, and as a result, replacing that income is a key consideration. There are many investments that appeal to retirement investors, such as purchasing quality dividend stocks like the Dividend Aristocrats. But there are also many investments that retirement investors should stay away from. Retirement investors should avoid the following 16 investments.
#1: Cash
“Cash is king” is a well-known phrase, but when it comes to retirement investing, cash is hardly king. Cash should be avoided by retirement investors because it earns no return. In stark contrast to bonds which pay interest or stocks that pay dividends, cash earns no interest. As a result, cash loses value over time due to the steady erosion of inflation.
While retirees have a number of pressing challenges to pay for expenses without a paycheck from working, keeping a great deal of cash on the sidelines is not the best idea. Ideally, retirees can generate enough income from their investments, in combination with other sources of income such as Social Security so that they do not need to hold a large amount in cash.
Read more: How to Sell Covered Calls for Monthly Income
#2: High-Yield Bonds
Sometimes referred to as junk bonds, high yield bonds are fixed income securities issued by companies with sub-investment grade credit ratings.
With interest rates still near historic lows, fixed-income yields have plunged over the past several years. As an example, the 10-year Treasury yields just 1.3% right now. With inflation running significantly above this level, retirees will see their purchasing power erode with low-yielding bonds.
Because of this, high yield bonds are appealing due to their higher yields. But investors may be reaching for significantly elevated risk in their search for yield. Bonds with below-investment grade credit ratings have a higher likelihood of default.
Read more: Can You Retire at 62 With 300k?
#3: Cryptocurrencies
Cryptocurrencies like bitcoin are all the rage these days. The massive rise in the value of bitcoin and other cryptocurrencies over the past few years is enticing for any investor. And cryptocurrency gets a lot of coverage in the financial media.
But retirees need to remember that volatility is a two-way street. The price of bitcoin has declined by nearly 50% from its 52-week high, a reminder that any investment can lose value. Bitcoin also does not pay interest or dividends, meaning investors will not generate income from their investment. And another reason retirees should avoid Bitcoin is simply the higher level of risk involved in buying cryptocurrencies, not to mention the tax implications.
#4: Oil & Gas Royalty Trusts
Oil and gas royalty trusts are niche securities within the stock market. These are companies that own oil and gas-producing properties. Investors receive distributions depending on how much income the trusts generate from these properties. Some well-known oil and gas royalty trusts include BP Prudhoe Bay Royalty Trust (BPH) and Permian Basin Royalty Trust (PBT).
As with any group, not all royalty trusts are bad investments. But the risks are high across the board—royalty trusts are essentially a bet on underlying commodity prices. Investors also have to face the prospect that reserves will decline faster than the trust had originally anticipated.
If oil and gas prices fall, share prices of the royalty trusts collapse, and their distributions decline, often to zero as occurred in 2020 during the coronavirus pandemic.
#5: Mortgage REITs
Real Estate Investment Trusts, also referred to as REITs, are a great way for retirees to earn higher levels of investment income. Many REITs have strong yields of 4% or more. Retirees might be tempted to buy mortgage REITs, a subset of the asset class that typically offers even higher yields.
Indeed, many REITs have double-digit yields in excess of 10%. But in many cases, sky-high yields are an indication of elevated risks, and mortgage REITs are no different. Mortgage REITs are extremely complex, financially architected business models that are not easy to understand, making them relatively poor choices for most retirees. In addition, mortgage REIT share prices and their dividend payouts can swing wildly based on changes in the yield curve.
Read more: Diversify Your Portfolio With These Top 10 International ETFs
#6: Gold
Every few years or so, gold gets a lot of attention in the media, usually because the price of gold has risen over a certain period of time. But for retirees interested in generating sustainable income from their investments, gold should be avoided.
Gold pays no dividends or interest, which is why it is not attractive for many retirees. To quote legendary investor Warren Buffett on gold: “The idea of digging something up out of the ground, in South Africa or someplace and then transporting it to the United States and putting it into the ground, in the Federal Reserve of New York, does not strike me as a terrific asset.”
Some gold stocks like Barrick Gold (GOLD) do pay dividends, but their dividend track records are highly inconsistent. Many gold stocks have cut their dividends when precious metals prices decline.
#7: Momentum Stocks
Momentum stocks are those that have captured investors’ attention, most often due to a rapid rise in their share price. This causes other investors to jump in, perhaps because of a fear of missing out, which can push share prices even higher. But in many cases, momentum stocks fall back down to Earth, as their underlying fundamentals may not justify the rallying share price.
Momentum stocks that have gotten a lot of attention in the financial media in recent months include GameStop (GME), AMC (AMC), and more. In all cases, their share prices skyrocketed in a relatively short period of time. But retirees should resist the urge to buy momentum stocks, as they can be highly volatile and almost never pay dividends.
Read more: 15 Dividend Kings With 50+ Years Of Dividend Growth
#8: Microcap Stocks
Stocks can be classified according to their market capitalizations, which is simply the current share price multiplied by the number of shares outstanding. Large-cap stocks have market caps above $10 billion, while small-cap stocks have market caps below $2 billion, with midcaps in between these ranges.
The smallest group of stocks is known as microcaps. These are stocks with market caps below $100 million. Microcaps are very small businesses, their stocks generally have low liquidity, and many are in questionable financial condition. As a result, retirees should stick to midcaps and large caps.
#9: Stocks With Too Much Debt
Debt is a big concern for income investors such as retirees. Stocks with bloated balance sheets and too much debt are at high risk of cutting or suspending their dividends during recessions. Profits may decline substantially when the economy enters a downturn, but debt still needs to be repaid.
Stocks with excessive debt have high-interest expenses that may force them to cut their dividends. This is of particular concern when it comes to high-yield Master Limited Partnerships, many of which have leverage ratios above 5x.
Therefore, retirees could generate dividend income with other tech stocks like Apple (AAPL), Microsoft (MSFT) or Cisco (CSCO).
Article originally published March 31st, 2020. Updated December 16th, 2022.
The Coronavirus Aid, Relief, and Economic Security Act, an economic relief package in response to the COVID-19 coronavirus pandemic, waives the 10% early withdrawal penalty for individuals who take out up to $100,000 from qualified retirement accounts for coronavirus-related purposes. Learn More.
Note: This article does not constitute legal advice. Please consult a lawyer or financial/ tax advisor about your specific situation.
Paying off debts or covering an unplanned expense are common reasons people tap into their 401(k)s early. But a 401(k) withdrawal can come with hefty tax penalties if you pull your money out too soon. Find out more about how to take money out of a 401(k) below, and decide whether it’s the right decision for you.
How to Withdraw from Your 401(k) Early
Your 401(k) account is meant to be a retirement account. That means it’s set up for you to start withdrawing from after a certain age—generally 59 ½. But you may be able to withdraw sooner if you feel you need your money now. Here’s how.
Check with your employer to find out if early withdrawals are an option. Not every employer allows withdrawals.
Find out what types of withdrawals are allowed. In some cases, 401(k) withdrawals are limited to certain amounts or allowed only for certain reasons.
Get withdrawal paperwork from your human resources department or download it from your 401(k) provider’s site.
Review the penalties and taxes you may pay for taking the money out early and ensure that you are okay with them.
Complete the paperwork and submit it. Disbursements may be made by check or directly into your bank account, depending on the provider, and may take up to several business days once the 401(k) withdrawal is approved.
401(k) Early Withdrawal Penalty
In general, when you make a withdrawal from your 401(k) before you reach age 59 ½, the Internal Revenue Service may charge you a 10% early withdrawal penalty.
You’ll also pay taxes on any amounts you cash out. That’s because your 401(k) was funded with pre-tax income from your paycheck. You didn’t pay taxes on it at that time, but you must pay taxes on the money when you draw it out to use as income later.
401(k) Hardship Distribution
If your employer plan provides for hardship distributions, you can take a portion of your 401(k) funds to assist in paying for some specific expenses without paying the standard 10% early withdrawal penalty. Each employer plan is different, though, so even if your plan allows for hardship distributions, it may not allow for the particular use you have in mind.
For example, some plans allow for medical or funeral expenses but will not allow for tuition and education expenses. Some plans will, regardless, the plan must have clear requirements. Before considering a hardship distribution, be sure to read the fine print on your plan to determine if your need is eligible.
In general, some expenses that can be covered using a hardship distribution might include:
Tuition, including room and board, for yourself, your spouse, dependents and certain beneficiaries
Medical expenses for yourself, your spouse or dependents
Purchase costs for your principal residence, not including mortgage payments
Costs related to avoiding foreclosure on or eviction from your principal residence
Repair costs for damages to your principal residence
Funeral expenses for deceased parents, spouse or dependents
Hardship withdrawals have hit a record high for the first time in nearly 20 years.This kind of spike is a testament to how it has become increasingly difficult for Americans to have a retirement safety net in the current economic climate. This increase is likely due to inflation concerns creating further economic hardship. Use this guide before considering a 401(k) withdrawal.
Even though the early distribution penalty is waived on approved hardship distributions, any withdrawal you make is taxed as regular income. You should consider what that means for your bottom line and review whether you’re pushing up against a higher tax bracket when taking the withdrawal into consideration.
401(k) Loan
Another way to get money from your 401(k) now without paying the withdrawal penalty is a 401(k) loan. This can be a good option if you can’t get a hardship distribution or want to borrow against your 401(k). Plans are not required to provide for loans, so review your plan to determine if this is an option for you.
What Is a 401(k) Loan?
A 401(k) loan is literally a loan that’s funded by your 401(k). When you take out this type of loan, you actually borrow from your future self. These loans come with interest, which you pay back into the 401(k) account—so you’re paying the interest to yourself.
401(k) loans let you take out a certain amount from your 401(k)—usually up to $50,000 or 50% of the account’s assets—without calling it “income.” You can use that money without paying the 10% withdrawal penalty or paying taxes on it.
Advantages of 401(k) Loans
Unlike a hardship distribution, you do not need to demonstrate financial need to take out a 401(k) loan. As long as your plan allows for loans and you meet the terms, you can take out this type of loan. Because interest payments on these loans are only meant to restore the account to its original state (as if you had not taken out the loan), 401(k) loans often have lower interest rates than other loans. And 401(k) loans for approved purposes may not require a credit check, so they might be an option when other credit is not. This is especially true as your employer may simply take the 401(k) loan repayments directly out of your paycheck.
Disadvantages of 401(k) Loans
When you take money out of your 401(k), it’s no longer earning interest for you. Typically, the interest you pay on the loan isn’t as much as your 401(k) could be earning in the same time period. That can mean a reduced total when it comes time to retire.
In most cases, you are required to repay a 401(k) loan within five years. If you quit your job before you pay off the total amount of the loan, you might be asked to repay the rest immediately. If you fail to meet the terms of the loan, the remainder of the loan might be treated as a withdrawal. That means you’re on the hook for taxes and the 10% withdrawal penalty.
401(k) Withdrawals After Age 59½
If you retire or lose your job after you turn 55, you may be able to avoid the 10% early withdrawal fee. In general, this applies only to the 401(k) plan from the employer you just left. Earlier plans are not eligible.
Once you reach age 59½, you may begin withdrawing funds from your 401(k) without penalty. You can choose a lump-sum distribution or periodic distributions based on your personal needs. Keep in mind that you’ll pay income taxes on lump-sum distributions right away. It’s a good idea to talk to your financial planner to decide what option is best for you.
You can, however, leave your retirement funds where they are until you reach age 72. At that point, plan participants encounter Required Minimum Distributions, when the IRS requires that you begin taking distributions of a certain amount each year (before 2020, the age was 70½). Your tax burden on those distributions will depend on your total annual income.
Are There Good Alternatives to Early 401(k) Withdrawals?
For those with good credit scores, there are a number of alternatives to 401(k) withdrawals that don’t come with a 10% tax penalty and don’t dip into your retirement savings. Here are a few options to consider.
Home Equity Lines of Credit
If you have equity in your home—which means it’s worth more than you owe on it—you might be able to borrow against that value. You can then use the money from a home equity line of credit (HELOC) to cover expenses or pay down other debts.
Pros: Because home equity lines of credit are secured, you may be able to secure a lower interest rate on them than with other types of debt. They also offer some flexibility, as you can use as much of the line of credit as you need as you see fit.
Cons: You need equity to access this type of debt. You also have to ensure you can pay it off if you plan to sell your home.
Personal Loans
Personal loans are typically unsecured debts you can use for personal purposes. If you’re approved for a personal loan, you might use it to pay off medical bills, consolidate other debts or cover an emergency home repair, for example.
Pros: Personal loans are available for all types of credit histories and needs. Doing a little research can often turn up a loan option that might work for you. Repayments are typically made over long periods, which can make monthly payments affordable.
Cons: Depending on your creditworthiness, a personal loan can come with a higher interest rate than other options. If you have bad or no credit, you may be limited to credit building loans, which can require a deposit.
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Your 401(k) and Your Future
When you’re facing a financial crisis right now, borrowing from your 401(k) can seem like an obvious answer. But carefully weigh the costs of doing so. You are, in effect, stealing from your future. If you can, look for other options that help both current-you and future-you.
The west coast is currently being ravaged by wildfires, including five of the top ten largest wildfires in California history so far. These devastating fires have burned down hundreds of millions of acres of land, resulting in at least 36 casualties and the loss of homes, businesses, and other structures. The entire west coast is experiencing unhealthy air quality, and smoke has reached as far as the east coast and even Europe.
Aside from the immediate consequences in terms of property damage and loss of life, wildfires also have a far-reaching economic impact. From the ongoing costs related to fire suppression and prevention to the loss of revenue, expensive repairs, and insurance hikes that inevitably follow, these fires have lasting financial repercussions.
The current wildfires will have an economic impact on both a local and a national level. While states including California, Oregon, and Washington are some of the most likely to be affected by wildfires, the financial fallout has the potential to be even more widespread.
What’s Ahead:
Fire suppression costs are rising
Battling wildfires is an expensive business, and the cost to fight fires has soared from tens of millions to hundreds of millions in recent years as destructive wildfires have become more and more common.
With 2020 on track to be one of the most devastating wildfire seasons on record, the cost just to get fires under control continues to climb.
You’ll see insurance hikes
As wildfires become more common in areas across the western United States, homeowners insurance and fire insurance is getting more expensive as a result. Some homeowners who live in fire-prone areas are unable to secure insurance coverage at all, with insurance companies canceling policies in high-risk areas.
Those who are able to secure insurance will likely face increased premiums as insurance companies attempt to cover the costs of current and future wildfire seasons.
If you live in an at-risk area for wildfires, you need to make sure you have the right insurance in place to cover all of your bases. Policygenius can help you double-check that you have the right type and amount of coverage for your home – and that you’re paying the best price for it.
Temporary power cuts have affected businesses
Power companies like Pacific Gas & Electric have implemented temporary planned power shutoffs in areas where its equipment is in danger of sparking wildfires. PG&E equipment has sparked over 1,500 fires from 2014 to 2017, and officials expect continued power cuts to be a regular feature of fire seasons to come.
These power cuts can have a negative economic impact when they prevent individuals and businesses from operating as normal. While the company is working toward implementing smaller, less disruptive cuts than the power outages that caused multi-day blackouts in 2018, power cuts will still affect tens of thousands of California residents.
Businesses are also seeing a loss of revenue
The wildfires sweeping across much of the western part of the country also have a severe impact when it comes to the loss of revenue. Many businesses aren’t able to operate normally or at all, and may find it difficult to reopen in the aftermath of the fires while also dealing with other issues such as the pandemic.
Wildfires also decrease the revenue brought in by tourism, which affects everything from restaurants and small businesses to hotels and state parks.
Expensive repairs will be needed
Costly repairs will be necessary for areas where wildfires have burned down buildings and damaged infrastructure. The 2018 wildfire season caused over $40 billion worth of damage, and the 2020 season is on track to cause even more damage.
The cost of the repairs is felt both by individuals whose property has been damaged as well as government agencies responsible for repairing infrastructure and cleaning up debris.
Healthcare costs will rise for those impacted by the fires
Other indirect costs of the wildfires include the healthcare costs associated with treating injuries related to the disaster. This includes treating not only those who were directly injured by the fires themselves, but also those who inhale too much smoke and those who are injured in accidents while evacuating.
Extreme wildfires cause hazardous air quality that can lead to coughs, headaches, and shortness of breath in the short term, and chronic inflammation, heart attacks, and strokes in the long term. Those with preexisting conditions like asthma or compromised immune systems are especially vulnerable.
Economic instability may increase
A report from the Commodity Futures Trading Commission predicts that the increased frequency and intensity of natural disasters like wildfires could result in further economic instability. These disasters can have a negative impact on many disparate areas of the economy including agriculture, infrastructure, residential and commercial property, and the health and wellbeing of American citizens.
Wildfire prevention costs will rise
While strategies implemented to help prevent or curb future wildfires like controlled burns and thinning are necessary, they’re also expensive. California recently passed a bill dedicating $1 billion toward fire prevention over the course of five years, but experts warn that even that amount may not be enough to curtail future fires.
There are many personal costs as well
While it’s not an easy thing to affix a number to, increasingly devastating wildfire seasons also take a tremendous personal toll, from people grieving lost loved ones to those whose houses burned down to those dealing with anxiety and depression caused by the fires.
These losses are often exacerbated by compounding issues like the ongoing coronavirus pandemic, economic inequality, and the effects of climate change.
How to protect your finances from the impact of natural disasters
Experts predict that wildfires and other natural disasters like heat waves and hurricanes will only become more prevalent as climate change continues to accelerate. People all over the world will be negatively affected by these catastrophic events – especially if they live in places with a high risk of fire, floods, or other disasters.
Here are some steps to take in order to prepare for future disasters and keep your finances secure in the face of an increasingly uncertain world.
Make sure you have the right insurance coverage
Insurance coverage for your property is especially important if you live in an area that may be at risk of wildfires. Even if you already have insurance, it’s still a good idea to shop around and compare different policies in order to ensure that you’re getting a good deal.
Again, online tools like Policygenius make it easy to research and compare different insurance options.
Maintain a healthy emergency fund
Experts recommend that you save between three and six months worth of living expenses in an emergency fund. This financial cushion can be a major safety net when it comes to literal emergencies like wildfires as well as other unexpected expenses.
While it can be difficult to increase your savings in a time of increasing economic inequality, it’s a good idea to try to put a little away each month so that you have something to fall back on in case of hard times.
Pack an emergency bag and it keep it up to date
If you live in an area that is prone to natural disasters, you should pack an emergency bag and keep it up to date, including essential such as:
First aid kit.
Drinking water.
Non-perishable food.
A change of comfortable clothes.
Toiletries.
Medications.
Cash.
Mask.
Radio.
Flashlight.
Local maps.
Phone charger and extra battery pack.
Be sure to keep your bag up to date and to swap out any items that are too old or in danger of expiring. You may want to prepare several kits to keep with you at home, in your car, and any other place you spend a lot of time in, such as your workplace or a relative’s house.
Secure important documents
Replacing important documents can be stressful if you have to leave your house during an emergency. You should keep documents in a secure, safe place that you can access quickly if you need to.
Some important documents you may want to take with you include your social security card, birth certificate, passport, and insurance information.
When it comes to other documents like bills and financial statements, consider switching to paperless billing so that you’re able to access them electronically in the case of an emergency.
See if your qualify for tax relief or other forms of aid
If you’ve experienced financial losses due to a federally declared disaster, you may be able to deduct it on your taxes. There are also a variety of wildfire relief funds and resources available, including:
The Disaster Cash Assistance Program for Washington state residents.
Disaster loan assistance for business owners from the SBA.
FEMA Disaster Assistance.
Red Cross shelters for those impacted by natural disasters.
The California Association of Food Banks.
Masks, medicine, and other resources from Direct Relief.
Disaster Unemployment Assistance for California residents.
Summary
Some experts estimate that the damage caused by the 2020 wildfire season will have a direct cost of over $20 billion, not including the many indirect costs associated with the fires, such as insurance hikes and loss of revenue. As wildfires continue to increase due to drought, warmer temperatures, and shorter winters, they are sure to have far-reaching effects on the economy.
While many aspects of natural disasters are beyond your control, you can stay prepared by reviewing your insurance coverage, packing an emergency bag, and building up your emergency fund.
House Republicans blocked an effort by House Democrats to approve $2,000 stimulus payments for millions of Americans, leaving the fate of the proposed $900 billion stimulus package mired in doubt.
It likely won’t come in time to wrap it up and put it in your stocking, but Congress has officially passed a stimulus package. The $900 billion stimulus package includes a $600 payment to every qualifying adult and child. But before you start planning to spend the money, there are a few things you’ll need to know.
Use your first stimulus check to bulk up your emergency fund – earn a high APY with a Chime® Savings Account
The bill includes relief for those who fall below a certain income threshold, as well as loans for small businesses and support for vaccine distribution. Here’s what you need to know about a possible second stimulus check coming your way.
What’s Ahead:
Who qualifies for the second stimulus?
As with the first stimulus payment, not everyone will qualify to receive a payment. To receive the full amount, your adjusted income will need to have fallen below $75,000 in the 2019 tax year. If your income was $75,000 or more, that $600 will be reduced by 5% for every $100 you made above the AGI limit.
Like the previous payment, the amount phases out entirely for taxpayers who hit a certain income threshold in 2019. Single filers who made $87,000 or more, joint filers earning $174,000 or more, and heads of households earning $124,500 will not receive a stimulus payment at all.
Best of all, the relief payment includes a $600 check for qualifying dependent children. You’ll get $600 for each child under 17 that you claim as a dependent on your taxes. Dependents aged 17 and older won’t qualify for a second stimulus check.
Why do we need a second round of stimulus checks?
The effects of the coronavirus pandemic are still being felt. While unemployment has dropped to 6.7%, it’s been a rough year for the U.S. economy. And there is still growing concern about the economic effects of COVID-19. Shutdowns have begun again as numbers increase, and the Fed has predicted a subdued economy through 2021. Efforts like stimulus payments can help keep businesses open when consumers might otherwise stop spending.
The second round of stimulus checks will inject more money into your pocket, and ultimately the economy (at least that is the hope). In doing this, it could spark another burst of economic growth, combined with other stimulus package dollars being infused, as well as what the Fed is doing to help economic growth (most recently they began buying corporate bonds).
What if my income dropped in 2020??
The stimulus payments are based on your 2019 taxes. But for many, the pandemic has caused that income to drop dramatically in 2020. If you earned $87,000 or more ($174,000 as a joint filer) in 2019, you won’t receive a second check right now, even if your 2020 income was significantly less. But that doesn’t mean you won’t receive one at all.
If your circumstances have changed, though, you’ll be able to claim the COVID relief payments as a credit on your 2020 taxes. Fortunately, this setup doesn’t work in reverse. If your income increased in 2020 and would put you over that threshold, you’ll still receive a second check based on your 2019 taxes. You don’t have to return either payment.
How soon will I receive my stimulus payment?
Your next question is probably, “When will I see the money?” That’s where the good news comes in. As soon as the President signs the bill, payments can begin being issued. According to Treasury Secretary Steven Mnuchin, “People are going to see this money at the beginning of next week.”
As with the previous stimulus check, though, your payment turnaround will depend on the payment information the IRS has for you. For the fastest payment, you’ll need to have direct deposit set up. If the IRS doesn’t have your banking information, your payment likely won’t come until after the first of the year. Even then, though, Mnuchin doesn’t expect paper checks or prepaid cards to take as long as they did with the first round.
Will I still get a check if I didn’t file a 2019 tax return?
As with the first round of stimulus payments, the second round will go to both filers and non-filers. As with the first stimulus payment, those who receive Social Security will be automatically issued a stimulus payment. Things get a little more complicated for those who don’t pay taxes.
One thing that’s changed with the second payment is that the IRS won’t consult your 2018 tax return if you didn’t file for 2019. However, the bill has expanded the sources the government can use to issue your payment. Instead of being limited to the Social Security Administration and your tax records, the IRS can now pull information from the Social Security Administration, Railroad Retirement Board, or Department of Veterans Affairs.
Is it taxable?
As with the first stimulus payment, the second one will not be taxable. It’s a tax credit, paid in advance, and it has no impact whatsoever on your tax refund. You’ll include it on your tax return, but it won’t be counted as part of your yearly income. You’ll also get the full amount of any refund you’re due next year regardless of whether you received a stimulus payment or not.
Will part or all of my payment be used to settle debts?
This is where the second payout differs from the first. This new bill specifically states that the funds can’t be garnished by creditors or debt collectors. As before, your payment can’t be held to pay government debts, including past-due taxes.
But what if you owe back child support? Unlike the first round, the second stimulus check can’t be held to pay past-due child support. The first stimulus payment didn’t have that protection.
What if my spouse doesn’t have a Social Security number?
The first payment went only to those who had a Social Security number. This affected spouses who filed jointly with those people. With this second payment, if you’re married and have a Social Security number, you’ll receive a payment even if your spouse doesn’t have one. You’ll also qualify for your under-17 dependent child to get a payment, even if only one spouse has a Social Security number.
This change doesn’t just apply to the second payment, though. If you’re married and one of you has a Social Security number, that person will be able to get the amount of the first credit retroactively. Simply apply for $1,200, plus $500 per qualifying child, as a recovery rebate when you file your 2020 taxes.
What if I’m unemployed? Does the stimulus package include funding for expanded unemployment insurance?
If you’re unemployed, the package includes a little extra relief for you. You may qualify for $300 extra every week in extra unemployment. These benefits will be for 11 weeks, running from December 26th to March 14th. The Pandemic Unemployment Assistance program for freelancers and any state-specific benefits are also extended under the bill.
Another item in the bill that’s bringing sighs of relief is the expansion of the eviction moratorium. The original protections were set to expire on December 31st, which could have left millions at risk for homelessness. Unlike the unemployment extension, though, the eviction moratorium only lasts through the end of January.
Does the bill include protections for small business owners?
Small businesses have been hit pretty hard by COVID-19, and this bill seeks to help a little. The new bill includes $284 billion for small business loans under the Paycheck Protection Program, which expired in August. The bill expands that program with some changes.
One of the biggest changes is that this new bill targets smaller businesses. To qualify, a small business must have fewer than 300 employees. A business must also have seen at least a 25% reduction in revenues during at least one quarter in 2020.
What else is included in the bill?
In addition to extending the moratorium on evictions, the new bill also includes $25 billion for tenants who are having a tough time paying rent. Those receiving benefits under the Supplemental Nutrition Assistance Program (SNAP) will see benefits expanded by 15% for four months.
The bill also includes $69 billion in funding to get the vaccine to the public. This funding will be provided to state, tribal, and local governments to help cover the cost of distributing and administering the vaccine.
Summary
Although the bill is available to read, the IRS will likely provide more information on when the funds will be available. Watch the IRS Coronavirus Tax Relief and Economic Impact Payments news page for the latest information.
In the meantime, check out this list of side hustles so you can make some extra money while you’re waiting on your stimulus check. This way, you can in effect, create your own stimulus.
Care homes operators have warned that a recent surge in mortgage rates and a delay to government reforms will sound a “death knell” for some UK providers.
The number of registered care homes fell to 12,224 on May 31 from 12,280 at the start of the year, according to data shared with the Financial Times by carehome.co.uk, a care home review site.
The rate of closures in England slowed in the first half of 2023, compared with the same period in 2022. However, a rise in mortgage rates threatens to increase the burdens on the care sector, compounding rising food and fuel prices and funding shortfalls.
“We are facing some extremely challenging times,” said Nadra Ahmed, chair of the National Care Association, a professional body. “There are vulnerable providers out there right now and there are a lot [of homes] that will be on the market.”
The challenges encountered by some operators would make their businesses “unviable”, she added, citing Pelham House in Kent as one of the latest to hit financial trouble. “Sadly they had to make the decision after 40 years to shut their doors,” she said.
“If you’ve got mortgages that’s going to have an impact on your ability to repay your borrowings.”
The Bank of England increased interest rates by 0.5 percentage points to 5 per cent in June in an effort to tame inflation, leading to rises in monthly mortgage repayments for borrowers on variable rates.
While interest rates are not expected to climb by as much as previously estimated following better than expected June inflation data last week, care providers are already feeling the heat.
Jay Dodhia, chief executive and co-founder of Serene Care, established with his wife Palvi, renovates and runs failing care homes. He said its model had been resilient but cautioned that rising interest rates could be particularly challenging for new builds.
“Most care homes are [on] variable rates — even when rates were very low it was very hard to get fixed rates on care home mortgages,” he said. “As the variable rate or the underlying BoE rate crept up, so have our interest payments.”
“Everything in isolation will affect you, if you put it all together — the rising inflation, utilities, food costs, staffing challenges . . . it could be a death knell for several [providers],” said Dodhia.
The number of councils in England reporting care home closures in their area rose to about 44 per cent at the end of May 2023, according to the Association of Directors of Adult Social Services, a charity.
Natasha Curry, deputy director of policy at the Nuffield Trust, said in 2019, before the coronavirus pandemic, the level was about a third.
“With borrowing rates also rocketing, it’s not a surprise that we’re seeing more closures of care homes and I think it’s inevitable that trend will continue,” said Curry.
During the Covid crisis, an injection of emergency government funding had helped to stabilise the market, cushioning the impact of falling occupancy rates. But that funding had ended.
Cathie Williams, joint chief executive of the Association of Directors of Adult Social Services, said councils had a duty to provide “continuity of care” for residents if a home closed.
But a decade of austerity, Brexit, the pandemic and staff shortages compounded by surging living costs had contributed to “a considerable lack of resilience” in the sector.
Where care places existed, “it tends to be because they’re in the wrong place or the wrong kind of care home or the quality is not good enough”, she added.
Health leaders warned of the effect of diminishing capacity in social care on the wider health system. Matthew Taylor, chief executive of the NHS Confederation which represents health organisations across the UK, said health leaders knew “all too well the impact that a lack of social and residential care has on the NHS”.
The support provided to residents in care homes could prevent avoidable hospital admissions. Moreover, a lack of available care home places for patients who could otherwise have been discharged from hospital could create “a log jam effect in A&Es with long ambulance waits”, Taylor added.
“The good news is we can see the rate of closures slowing in England and Wales although unfortunately Scotland has seen a rise,” said Richard Stebles, head of business intelligence at carehome.co.uk.
“In order to stay sustainable, we are likely to see care providers trying to attract more privately funded residents who pay higher fees than those funded by the local authority.”
Dodhia said the average fee for publicly funded social care bed should be £900 per week. But local authorities are often paying about £600 to £700 a week; some are willing to spend just £490 a week.
Care home operators had hoped for more funding from local authorities following a “cost of care exercise” that sought to generate a shared understanding of the cost of adult social care. But some councils struggled to increase payment and reforms were pushed back to October 2025.
Providers have also fought to access the £200mn earmarked for the NHS crisis plan, which aimed to move patients from hospitals to care homes.
A “winter discharge fund” had been announced, said Dodhia, but “local authorities didn’t really want to spend it”. He added: “They knew that as soon as that funding ran out then the residents would be left vulnerable, because they can’t continue to fund [the scheme].
“We heard about all these great support plans but we didn’t see any of it,” he said.
The Department of Health and Social Care said it was investing up to £7.5bn in social care over the next two years — “the biggest funding increase in history” — to boost capacity in social care, including £1.4bn that local authorities could use flexibly, including to pay social care providers more.
It added: “Despite the pressures the adult social care market faces, the number of adult social care locations registered with the Care Quality Commission has remained stable, and there are 6,600 more home care agencies in England now compared to 2010.”
Every American Airlines plane flies for hundreds of hours, carrying thousands of passengers for miles across the globe. But after a while, even the most reliable aircraft needs a break. For some of them, that break comes at a sprawling 3.3 million-square-foot facility in Tulsa, Oklahoma.
Functioning as its own ecosystem within Tulsa, this facility’s various hangars and warehouses are where the airline’s planes are picked apart. Seats and engines are refurbished. Exteriors are repainted to sport red, white and blue stripes along the tail fins.
These are only some of the many tasks that occur in this spacious, maze-like facility. Hangars upon hangars stretch across the massive property by a National Guard base and an Amazon warehouse.
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“It’s like a city within a city,” Barbara Cruz, a store supervisor at American’s Tulsa facility, said.
Thousands of American planes have gone through Tulsa since 1946, when the Fort Worth-based carrier relocated its maintenance base from LaGuardia Airport (LGA) to the old oil capital following World War II.
The base — a major hub for American’s maintenance operations — now has about 4,800 employees and claims to be one of the largest commercial aviation bases in the world.
At any given time, the facility can hold up to 20 narrow-body aircraft in its hangars; 800 commercial planes pass through it annually.
In 2020, American unveiled plans to invest $550 million in the Tulsa base to construct a new wide-body hangar and make improvements to each building in the facility. The new hangar should’ve begun taking shape in early 2021, but its construction start date was pushed back due to the coronavirus pandemic. It will be able to hold two wide-body (or about six narrow-body) aircraft at a time.
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Despite the renovation delays, the Tulsa base serves as an important destination for many American aircraft. It handles every bit of maintenance for a plane, from cleaning out toilets to inspecting engines.
Boeing 737s and 777s are the jets that primarily make their rounds in Tulsa. The aircraft either go through heavy, routine or unscheduled maintenance in a process that’s similar to surgery.
“We document all the findings,” Ed Sangricco, the managing director at the Tulsa base, said. “We go in, and we fix all those findings. We close the airplane, we put it back together again, and then we check everything — we make sure everything works.”
While the pandemic halted travel and grounded planes worldwide, that didn’t stop the maintenance technicians, engineers, managers and supervisors in Tulsa. American’s aircraft technicians were tasked with maintaining roughly 100 aircraft already at the base to prevent corrosion (and to stop weeds and birds from infesting the crevices of the planes). That meant remote work wasn’t an option for the employees at the Tulsa base.
Airlines received billions of dollars from the federal government during the pandemic partly to keep their fleets in tip-top shape, so they would be ready when travel demand returned.
“Maintenance requirements don’t stop during COVID-19,” Sangricco said.
Related: 6 incredible facts about the Boeing 777
What it takes to maintain a plane
Maintaining a commercial plane is a complicated process. Hearing all the steps to ensure an aircraft is running smoothly — all over the course of an eight-hour tour — was similar to taking a college crash course in physics and engineering.
Aircraft maintenance is heavily governed by the Federal Aviation Administration, which has a set list of requirements and deadlines for every plane component. Every record chronicling the maintenance of an aircraft needs to be preserved to be in compliance with the FAA, according to Roger Steele, a supervisor at the Tulsa facility who specializes in 737 narrow-body maintenance.
So, document holders containing slips of paper that detail every task from the FAA line two walls of an office within a 737 hangar at the Tulsa base.
At the start of a visit, a 737 narrow-body will undergo about 1,200 required tasks — excluding non-routine inspections — before it can fly again.
The Tulsa facility is never quiet. Throughout my tour of the maintenance site, I could hear constant drilling noises and the occasional thunderous engines of a National Guard plane taking off a couple of miles away as Steele explained the ins and outs of narrow-body maintenance.
The 737 I saw in the hangar had already been stripped down, as it was in its fifth day of maintenance. (The crew at American has around 25 days to completely finish work on the plane.)
The seats, the walls and the flooring were completely gutted from the aircraft. All that was left inside were gray insulation bags on all sides, which made the 737 look more like a cave than a plane.
Inside, technicians were already hard at work. One was by the plane’s back door, critically documenting what parts had been affected by corrosion.
While several areas can suffer from corrosion, a plane’s galleys and lavatories are the most susceptible to corrosion and environmental damage, as moisture from toilets and soft drinks wear down the interior.
“What coffee and soda pop can do to an aircraft after humans consume it is very corrosive,” Steele joked.
Once the technician documented the damage, the next step was determining what parts needed reinforcement. One piece of metal in the galley suffered from corrosion, so the technician sanded the area and recorded its remaining structural thickness.
Like the maintenance process itself, refurbishing an aircraft is anything but glamorous. At the Tulsa base, the majority of hangars and buildings have no air conditioning, leaving most of the workers stuck toying away at engines and aircraft in the sweltering summer heat.
When I toured the site, it was already a muggy 90 degrees, but Tulsa summers can soar well into the 100s during the season’s peak.
For some, the day starts early. Robert Bales, a maintenance technician who works on wide-body half galleys, normally wakes up at 5 a.m. for his 6:30 a.m. shift.
Each technician works around 8 1/2 hours. Much of the schedule, specifically for cabin work, is determined by the crew chief and the needs of the aircraft.
Before someone can start working at the facility as a technician, they must undergo significant training.
Gabriel Figueroa Navedo, another wide-body aircraft technician, said he went to trade school to receive an FAA-issued aircraft technician license. There, Navedo — who first started his career managing reservations and bookings for American — learned extensively about topics like hydraulics and electricity.
However, Navedo said many of those skills do not directly apply to his day-to-day job. Instead, the training provided a general knowledge of planes.
“I like to call it a license to learn,” Navedo said, “because it’s got to cover stuff like small propeller engines, and the FAA doesn’t know if you’re gonna work here, or if you’re gonna be working on your own private plane.”
Related: What it’s really like at flight attendant training
Even the seats and toilets need a makeover
When an aircraft’s seats need refreshing, the plane goes to a different warehouse, where the seats get disassembled. During this process, technicians tend to find all sorts of trash underneath, including gum, candy, pills, credit cards, cellphones and iPads.
“You’re gonna find no telling what,” Brent Strickland, a supervisor who primarily works on Boeing 777s and 787s, said.
Strickland said he has even found false teeth and engagement rings inside the seats.
After removing the various items passengers leave behind, the seats are washed and left to dry. Then, the technicians check the hardware for any damage.
Cushions are changed about every six years, according to Strickland, and it only takes two to three days to completely finish a seat.
It’s not just the seats that need refurbishing during maintenance — the toilets also get picked apart. The waste tanks are cleaned out, and the flushes are inspected by another team of technicians dedicated to toilet maintenance. Strickland described those team members as “another one of those unsung heroes.”
Dee West, a technician, cleaned out a water valve during my tour, closely inspecting the valve under the scope of a flashlight before carefully reassembling the three parts and a spring in the pipe.
“It ain’t no joke,” he said. “It’s gotta be done right.”
One mistake by a toilet technician could be costly for the airline, as each toilet costs $17,000.
Perhaps surprisingly, this area of focus is one of the more desirable on the Tulsa base, according to an American spokesperson. That’s because it’s one of the few jobs workers can do inside an air-conditioned building — providing a reprieve from the otherwise hot and muggy weather Tulsa experiences every summer.
Engines, windows and other plane parts also get a makeover, depending on the aircraft’s maintenance schedule. This includes the fans and combustive parts of the engine, which the staff works on separately in “cold” and “hot” rooms within another hangar, respectively.
Blue lines on the walls demarcate the “cold” parts of the room, whereas painted yellow lines indicate the “hot” area.
Staff members also inspect some parts of the engine by soaking them in a fluorescent lime-green liquid to magnify which parts need to be reinforced.
Whenever parts like the wings and the radome — located at the tip of the plane — need a lift, they are sent to a composite center. There, they get reinforced with materials such as carbon fiber and a honeycomb web made from materials like aluminum.
“[It’s] poetry in motion,” Jody King, a composite repair center crew chief at American’s composite repair center, said when referring to the process of fitting the materials onto parts of the aircraft.
The reason this complex web of maintenance is even possible is because American’s site also has a warehouse containing thousands of parts and stickers. These parts are either shipped to other hangars in Tulsa or to airports and third-party services that need to do maintenance on an aircraft.
Related: Take a look inside Air New Zealand’s unique cabin innovation laboratory
Gearing up to fly again
Before a plane is ready to fly again, the landing gear — the wheels on the plane, in layman’s terms — must be checked, and the exterior must be repainted and rewaxed.
You may not notice the gargantuan size of planes since you typically only see them from afar in the sky or through the windows of an airport. However, were you to see one up close, you’d be struck by the size.
The landing gear alone measures at least 21 feet tall, roughly the equivalent of four people my height (I’m around 5 feet, 4 inches) standing on top of one another.
The wings also feel so vast it almost seems impossible that workers can repaint them by hand in a matter of days; the team uses foam rollers and brushes, according to Jeff Green, a shared services supervisor.
Once the plane completes its maintenance maze in Tulsa, it’s ready to return to the skies and fly to hundreds of destinations. Later, it’ll likely touch down in Tulsa yet again to go through the same routine.
If you haven’t heard of “Guaranteed Rate,” there’s a good chance you’ve never applied for a home loan before. Or maybe you just don’t live in the Midwest, where they’re headquartered.
Despite being from Chicago, they offer home loans to borrowers in all 50 states and Washington D.C., so they can be included in your mortgage search if and when it comes time to apply.
Their goal is to become the top retail mortgage lender in the country, which while ambitious, isn’t necessarily out of reach given their tremendous growth in such a short period of time.
The Relatively Short History of Guaranteed Rate
The retail mortgage lender was founded in the year 2000
Its headquarters are in Chicago, Illinois
They have roughly 4,000 employees and nearly 350 offices nationwide
One of the top-10 largest retail mortgage lenders in the country
Funded nearly $50 billion in home loans during 2020
While they’re a pretty big name in the mortgage world, they only got started back in the year 2000. That means they’re less than 20 years old, which is pretty short stint for a such a successful lender.
In 2020, they originated more than $48.8 billion in home loans, which should put them in or close to the top 10 in terms of total volume for all mortgage lenders.
Part of their growth can be attributed to acquisitions, including Manhattan Mortgage in 2012, and Sun State Home Loans, Nationwide Direct, Arbor Mortgage, and Firstrust Mortgage in 2014.
They also took over a call center and roughly 75 loan officers from Discover Home Loans after it went belly up in 2015.
Most recently, they acquired Stearns Lending, which funded roughly $7.6 billion in home loans themselves in 2019.
The move is a serious attempt to become the country’s #1 mortgage lender, though competition is certainly fierce as you near the top.
You might also recall that the company hired Ty Pennington of Extreme Makeover fame a while back to market the company.
A recent joint venture with Realogy’s real estate brokerage company NRT known as “Guaranteed Rate Affinity” has made them a major player in the home purchase financing market as well.
The lender also created another partnership with @properties known as “Proper Rate,” which will extend home loans to home buyers in select regions in the country, namely those represented by @properties’ 2,800 real estate agents.
And their latest JV is known as “OriginPoint,” an independent mortgage lender created with real estate brokerage Compass.
Guaranteed Rate boasts a very high customer satisfaction rating of 95% whom said they were “satisfied.”
Additionally, 94% said the company “made it easy for them to obtain a loan,” and 95% said they’d use the company again in the future.
This is similar to PrimeLending, which also touts one of the highest customer satisfaction ratings in the country for mortgage lending.
Getting a Mortgage with Guaranteed Rate
They have a fleet of mortgage loan officers you can search by name
And a few hundred branches in cities throughout the country
You can also apply online or via their smartphone app without assistance
And the home loan process is close to or fully digital in some cases
The company is a consumer-direct retail mortgage lender with what they call an “Intuitive Loan Finder.”
In my experience, it’s basically a lead form that gives you loan options after you answer the typical borrower and property-related questions.
They have since renamed it “GRafforable” in what appears to be an effort to show off their silly side.
They say the GRaffordable loan finder tool is the best mortgage calculator out there, which allows borrowers to gain access to real-time mortgage rates in seconds.
I gave it a whirl and it did indeed take just seconds to generate loan options including a “best match” based on my inputs.
The only drawback was that it didn’t list interest rates for all products displayed.
The good news is you don’t have to provide any contact information to get a bunch of real mortgage quotes in just seconds.
If you like what you see, you can apply for a loan or connect with a loan officer.
The company says it created a “Mortgage Pod” model that surrounds their LOs with a team of “highly-trained specialists” to ensure you’re in good hands.
They also have a “Loan Expert” search feature on their website if you know who you want to work with already.
Or you can simply contact a local branch near you if you want assistance from someone in your area.
Those who prefer to do things without much human interaction can just begin the process online and stay there the entire time if desired.
The company claims to have the “World’s First Digital Mortgage” with proprietary tools like their Transfersafe secure document transfer to streamline the process and eliminate paper waste.
They also say you can get an automated approval from Fannie Mae or Freddie Mac within minutes, likely a mortgage pre-approval, and you can apply for a mortgage using their mobile app.
Their “Red Arrow Approval Express” brings back same-day underwriting with “real approvals” generated in as little as four hours that are probably more robust than their automated pre-approvals.
And their “Appraisal Express” option delivers a home value within 48 hours of the appraiser’s visit to your property to cut down the lengthy loan process.
So it’s clear they’re big on technology and speed, similar to other major players like Quicken’s Rocket Mortgage and newcomers like SoFi.
Guaranteed Rate FlashClose
In light of the coronavirus pandemic, Guaranteed Rate wants you to know that they’ve got a contact-free digital mortgage experience from start to finish.
This includes options that limit or completely eliminate the time an appraiser needs to spend in your home or soon-to-be home.
The finishing piece is known as “FlashClose,” a technology powered by Notarize that allows borrowers to sign most of their closing documents either online or even from their smartphone or tablet.
This may also alleviate some of the stress of signing a bunch of loan documents in one sitting while a notary waits, giving you more time to review and ask questions.
Aside from allowing you to safely social distance, you also get an efficient, simple and secure experience from application to closing.
What Loan Options Does Guaranteed Rate Offer?
Home purchase, refinance, construction, and renovation loans
Conventional, government, jumbo, and non-QM loans
Fixed-rate mortgages and ARMs with various loan terms
Interest-only mortgages
Rate buydowns and long lock periods
They have a variety of different loan products available, including home purchase loans, construction loans, renovation loans, rate and term refinances, and cash out refis.
You can get a conventional loan backed by Fannie or Freddie, or a government loan backed by the FHA, USDA, or VA.
They participate in HUD’s Good Neighbor Next Door program, which allows law enforcement, teachers, firefighters, and EMTs to get mortgages with as little as $100 down payment.
Speaking of low down payments, they also offer a 1% down mortgage program, which combines the 97% LTV program with Fannie/Freddie and a 2% grant.
In the home improvement channel, you can get an FHA 203k loan or a Fannie Mae HomeStyle renovation loan to renovate and finance your property in one convenient loan.
Additionally, they have both conforming and jumbo loan amounts available to their customers in more expensive regions of the country, along with both fixed-rate loans and ARMs.
In terms of available programs, you can get a 30-year fixed, 20-year fixed, or 15-year fixed.
In the adjustable-rate category, they’ve got a 5/1 ARM, 7/1 ARM, and 10/1 ARM. They’ve also got interest-only options for those who believe their money is better spent elsewhere.
The Guaranteed Rate 2-1 Buydown
Guaranteed Rate also offers a 2-1 buydown, which offers a rate 2% below the note rate in year one, and 1% below the note rate in year two before returning to the actual rate offered.
For example, if you qualified for a rate of 5% on a 30-year fixed, you’d get a rate of 3% the first year, 4% the second year, and 5% for the remaining term.
When it comes to locking in your rate, they offer a “Lock n’ Roll” option that allows you to renegotiate your rate if interest rates go down.
Lock terms are also pretty lengthy, with 55-, 70-, and 85-day options available.
For those doing construction, they offer the “Lock n’ Build” option with lock periods as long as nine months, or 270 days.
I don’t believe they offer second mortgages or home equity loans/lines, which would be the only major product category missing here.
Guaranteed Rate Mortgage Rates
You can find their daily mortgage rates right on their homepage
They don’t appear to be noticeably higher/lower than most other major lenders
Check the loan assumptions to see what’s required for the advertised rates
And take the time to shop around if price is your number one concern
One thing I like about Guaranteed Rate is the fact that they advertise their mortgage interest rates right on their homepage.
This means there’s no guessing as to where they stand pricing wise. Of course, advertised rates always contain lots of assumptions, such as a specific credit score, loan-to-value ratio, and so on.
For example, their rates require a 25% down payment, as opposed to the typical 20% you often see advertised, a 740+ FICO score, and the property must be a one-unit primary residence.
In other words, you may not actually qualify for the rate seen on their website, though it should at least give you an idea if you compare their advertised rates to those of other lenders.
I felt their rates were in line with what other major lenders advertise – not necessarily cheaper or more expensive.
Guaranteed Rate Reviews
They have a 4.96 star rating out of 5 on Zillow, which is as close to perfect as you can get.
It’s based on more than 10,000 customer reviews, so the company has certainly been heavily vetted by those who have used them.
A good chunk of the reviews indicated that both the interest rate and closing costs were lower than expected, a good sign if you’re looking for the best deal.
You’d think with a name like Guaranteed Rate that the mortgage rate would be good, right?
At last glance, their Better Business Bureau (BBB) profile was rated ‘A’, with about 40 customer complaints over the past 12 months.
They are an accredited business with the BBB since 2009.
Those looking to dig even deeper should consider searching for individual loan officer reviews online.
Many if not all of their employees have reviews that can be easily found, and with such a large company, it may be a better indicator than overall ratings.
Why Choose Guaranteed Rate for Your Mortgage Needs?
They claim to offer the World’s First Digital Mortgage
And offer a lot of tools to close your loan quickly and easily thanks to tech investments
They’ve won a lot of best lender awards
Have high levels of customer satisfaction that beat most others in the industry
They claim to be a technology leader in the mortgage space with the “World’s First Digital Mortgage,” so if speed and convenience is your thing, they might be a good choice.
The same-day underwriting and 48-hour appraisal turnaround time can certainly make a traditionally slow and painful home loan process a lot faster.
They’ve also been able to cut the closing appointment down to around 10 minutes thanks to electronic signing.
And being able to do most, if not everything, from a computer or smartphone should ease the burden of obtaining a mortgage.
There are plenty of loan options to suit most borrowers’ needs, and their customer satisfaction numbers are some of the best in the industry.
They were recently named in the Best Mortgage Lenders of 2018 list by U.S. News and World Report and received the 2018 FinTech Breakthrough Award for the Best Online Mortgage Lender.
They could be a good choice for a home purchase seeing that they’re partnered up with Realogy and likely trusted by lots of real estate agents nationwide to close your loan on time without any hiccups.
The company also offers insurance, including homeowners insurance, auto insurance, and life insurance via one of their subsidiaries. So they might be a one-stop shop for all your homeownership needs.
Guaranteed Rate is also committed to being transparent and promise low rates and fees, which after all, is kind of in their company name.
Of course, they might not offer the lowest mortgage rates around, so shopping is always recommended.
Guaranteed Rate Pros
Appear to have competitive mortgage rates
Offer a fully-digital mortgage experience (contact-free)
Can apply online, in-branch, via smartphone, etc.
Lots of different loan programs to choose from
Excellent reviews from past customers
‘A’ BBB rating, accredited business
They have a free smartphone app
Offer entire mortgage experience in Spanish
Guaranteed Rate Cons
They charge a $1,290 lender fee
May require higher minimum credit scores than other lenders
Don’t appear to offer second mortgages or home equity lines of credit (HELOCs)
Will likely transfer your mortgage to a third-party loan servicing company
To mark the 10-year anniversary of Detroit’s historic July 18, 2013, municipal bankruptcy filing, the Free Press is examining what has changed, what hasn’t, and why. Find more coverage atfreep.com.
Alease “Cookie” Moore loves her Cornerstone Village neighborhood.
It’s the simple things. Walking the streets, saying hi to neighbors sitting on their porches, planting crops at the community garden — beets, corn, sweet potatoes, herbs. She loves supporting the East Warren Farmers Market and local businesses like the Detroit Pepper Company, a Warren Avenue carryout spot that opened in 2019. She attends neighborhood meetings and advocates for her community as secretary of the Cornerstone Village Community Organization.
the city promised to crack down on blight by suing landlords.
10-year, $1.7 billion reinvestment plan.
Did it work? Are we better off?
retirees. Under state law, the city’s budget reserve is required to hold at least 5% of its projected recurring expenditures each fiscal year to cover a potential financial disaster or reduction in revenues. Detroit’s reserve was 11% of its expenditures in its latest adopted budget.
“Right after the bankruptcy, revenues certainly stabilized, and we’re starting to show some modest growth,” said Detroit Budget Director Steve Watson. “It was in the years just prior to the pandemic, income taxes really started to take off and show much more robust growth … where the bankruptcy assumed somewhere around a 2% growth rate per year in revenues, we’ve instead vastly exceeded that.”
At the end of the 2022 fiscal year, city income tax revenue was about $400 million — up from less than $250 million in 2014. The bankruptcy plan of adjustment — the court-approved document that charted a path forward as the city exited bankruptcy in 2014 — assumed that income tax revenue would be about $300 million in 10 years, Watson said. Increased revenues generated a surplus, which is now funding various initiatives, while allowing money to be set aside for rainy day and retiree protection funds. Watson said the developments have put the city in a stronger financial position in the long term.
Citizens Research Council. At the end of the 2022 fiscal year, Detroit reported more than $544 million in cash on hand, or more than 200 days’ worth of expenditures.
criminal record expungement that could boost employment opportunity in the city.
“Programs that are expunging (criminal) records on job applications, combined with skills training and increased apprenticeships, will go a long way to reduce crime by giving men in their late teens and early 20s hope and meaning,” Metzger said.
Home values
It wasn’t exaggeration or urban myth.
Buyers were picking up houses for the price of a cheap couch in areas of Detroit following the Great Recession.
Those bargain basement prices helped deflate the median owner-occupied home value to just under $43,000 in 2013. That’s according to U.S. census estimates in 2021 dollars from the annual American Community Survey.
But the rebound has been considerable, experts say, with help from an overall real estate market recovery paired with Detroit’s post-bankruptcy reinvestment in basic city services stirring more demand.
The most recent estimate shows that median owner-occupied home values rose to $69,300 in 2021, a nearly 62% increase since 2013. (The data is based on survey respondents’ estimates of how much the home is worth.)
according to the mayor’s office.
New mortgage loans in Detroit still remain low compared with other cities, according to research by Detroit Future City, with only 3,211 home purchase loans made in 2022. And Black applicants were denied home loans in the city at twice the rate as white applicants, the group found in 2020.
Williams Clark said it’s important to make sure the city continues to have a “diversity of price points,” where a wide range of people can buy into the American Dream of homeownership.
“So that people who are existing residents and other residents can benefit from that wealth creation, but there is also still opportunity for people to have access to those homeownership dreams and goals,” she said.
Poverty
Detroit has seen major gains in its households moving out of poverty.
So much that it has surpassed the improvement in most large industrial cities in the Midwest and Northeast since 2012, researchers say. One expert went as far as to call the progress “remarkable.”
“This is real success,” said Luke Shaefer, director of Poverty Solutions, an initiative at the University of Michigan that partners researchers, policymakers and community members toward alleviating poverty. “That’s transformational.”
In 2013, 40.7% of Detroiters were considered living below the poverty line, according to the U.S. Census estimates from the annual American Community Survey. But that number dropped to 30% as of 2021.
announced the city’s unemployment rate had dropped to its lowest level since the Bureau of Labor Statistics started tracking monthly jobless levels in the city in 1990.
Detroit’s unemployment rate in April was 4.2%, according to BLS figures. That rate has risen slightly since then, to 6.4% in May, but is still much lower compared with an average rate of 18.8% in 2013.
Study finds Detroit’s unemployment rate was 16% in March when including a group called “labor force rebounders:” residents who are retired, disabled, students, have family or personal obligations or otherwise choose not to work, but report actively searching for a job in the past month. This group of residents in other surveys may not be considered unemployed because they chose not to work and weren’t laid off recently.
DMACS’ surveys show that the jobless rate has improved from the beginning of the COVID-19 pandemic — when unemployment spiked to 43% — and from September 2021, when DMACS said the jobless rate in the city was 25%. The jobless rate is still higher, though, than its estimated pre-pandemic unemployment rate of 8%.
Lydia Wileden, author of the University of Michigan DMACS report, said the differences between BLS and DMACS data “suggests something about the employment situation is potentially being missed.”
High school graduation rates
While Michigan’s four-year graduation rate has hovered around 80%, Detroit’s has continually lagged behind.
Just before Detroit filed for bankruptcy in 2013, 64.6% of Detroit Public Schools seniors graduated, according to state data, compared with 77% of Michigan seniors. The school district’s four-year graduation rates for students has since ticked up to a high of 78.3% in the 2015-16 school year, and dropped again to 64.5% in 2020-21, at the height of the coronavirus pandemic, as students struggled to show up to school in-person.
signed a $617 million state bailout of the district. The deal restructured the district into two entities: One retired district to exist for debt retirement, and a new community school district with a locally elected board and revenue to operate.
District Superintendent Nikolai Vitti, who took the helm in 2017, has touted academic progress since then, including improved attendance. However, the pandemic set students back considerably, and Detroit continues to rank last among major city school districts in reading and math scores.
‘What about the neighborhoods?’
It’s difficult for many Detroiters to rejoice in the progress that has been made, with much left to be desired.
Karen Knox, an east-sider and executive director of the Eden Gardens Community Association, has noticed that police have been quicker to respond in emergencies, and there are far more working streetlights since the bankruptcy.
But she said she isn’t seeing enough businesses opening, or houses being built in lots where blighted properties were demolished. Illegal dumping, flooding and blight persist. She has seen long wait times for buses, and crime remains a top concern.
“Where did the money go?” asked Knox, 62. “Downtown is booming, but what about the neighborhoods? … No one is talking to neighborhoods and asking them what they want — look how we’re living.”
It’s a familiar sentiment. Detroiters were making the same complaints 10 years ago. But the tone is different. There doesn’t appear to be the same level of anger and desperation. And with poverty and unemployment way down, home values up and a city budget with some breathing room, the outlook appears far less bleak.
“Where are you from?” It’s a common question when you meet someone new while traveling. And it’s an easy question for most people. But for me, it’s complicated if I want to give more details than “the United States.”
After all, my husband and I gave up our Austin, Texas, apartment in June 2017, sold or donated most of our belongings and then set out as digital nomads on July 2, 2017. So, excluding some extended time living with family early in the coronavirus pandemic, we’ve traveled full time while working remotely for the last six years.
In 2020, I wrote about my first three years as a digital nomad. But in this story, I’ll look back at the past six years. In doing so, I’ll discuss how I became a digital nomad, some of my travel statistics and how travel has changed for me during the past six years.
How I became a digital nomad
On a bus from Aguas Calientes to Machu Picchu in Peru in 2013, I first heard of a gap year or sabbatical year. I hadn’t gotten into points and miles yet, but my husband and I loved the idea of taking a year off to travel after I finished graduate school. Well, fast forward four years to 2017, when it was time to leave on our “gap year.” By this time, we were already working as writers in the award travel space.
So, we hit the road as digital nomads instead of taking a gap year. And we quickly fell in love with the freedom and flexibility of the lifestyle. I appreciate experiencing different cultures, landscapes, experiences and cuisines daily. And I’ve found that frequently visiting new destinations inspires me.
I also enjoy using the topics I write about — points, miles, credit cards and elite status — on a daily basis. We make award redemptions most weeks (and often multiple times a week), and we’re constantly traveling. So, I know many of the airline, hotel and credit card programs I write about from personal experience. And I’m personally invested when these programs change or devalue their rewards.
Points and miles certainly fuel some of our travel. But we also book paid flights and nights when it makes sense. After all, we only have a finite amount of points and miles, and we’ve found that paid partner-operated premium-cabin flights are often the best way to earn airline elite status.
Related: 6 ways award travel and elite status pair well with my digital nomad life
1,121,959 miles on 575 flights
Over the last six years, I’ve taken 575 flights on 62 airlines to 180 airports in 58 countries. I’ve taken so many flights in the last six years that my flight map is difficult to read.
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I flew 1,121,959 direct flight miles in the last six years, with an average flight distance of 1,951 miles (about the distance from Atlanta to Los Angeles). My longest flight was 9,532 miles, from New York to Singapore. And my shortest flight was just 11 miles from Tahiti to Moorea in French Polynesia.
But my most memorable flight was on Sri Lanka’s Cinnamon Air from Polgolla Reservoir Aerodrome (KDZ) to Koggala Airport (KCT) on a Cessna 208 amphibious caravan.
I frequently fly American Airlines and often use Hartsfield-Jackson Atlanta International Airport (ATL) when visiting family. So, it’s not surprising that my three most frequent routes by flight segments are between American Airlines’ hubs and Atlanta. Here’s a look at my top 10 most frequent flight segments over the last six years:
New York’s LaGuardia Airport (LGA) to/from ATL: 15 flights
Dallas Fort Worth International Airport (DFW) to/from ATL: 11 flights
Charlotte Douglas International Airport (CLT) to/from ATL: 10 flights
Kuala Lumpur International Airport (KUL) to/from Kualanamu International Airport (KNO): 10 flights while I earned Malaysia Airlines Enrich Gold status in 2019
Los Angeles International Airport (LAX) to/from ATL: Nine flights
Las Vegas’ Harry Reid International Airport (LAS) to/from LAX: Eight flights
DFW to/from LGA: Six flights
London’s Heathrow Airport (LHR) to/from LAX: Six flights
Hong Kong International Airport (HKG) to/from Da Nang International Airport (DAD): Six flights booked during Cathay Pacific’s New Year’s deal in 2019
DFW to/from LAS: Five flights
And my loyalty to American Airlines AAdvantage and its Oneworld partners shows when you look at the airlines I flew most by flight segments:
American Airlines: 224 flights, including reviews of American’s A321T business class, 787-9 business class, 777-200 business class with B/E Aerospace Super Diamond seats, 787-8 Main Cabin Extra, 757-200 Main Cabin Extra and 757-200 business class
United Airlines: 31 flights, including reviews of United’s 787-8 economy class and 757-200 economy class
Southwest Airlines: 29 flights, including a review of Southwest’s 737-800 from Oakland, California, to Newark
Malaysia Airlines: 26 flights
Qatar Airways: 23 flights, including reviews of Qatar Qsuite on a 777-300ER and Qatar Qsuite on an A350-1000
Delta Air Lines: 22 flights, including when I was one of the first American tourists to fly to Italy on a COVID-19-tested flight
British Airways: 20 flights, including a review of British Airways’ A380 economy class
Cathay Pacific: 17 flights
Japan Airlines: 14 flights, including a review of Japan Airlines’ 777-300ER premium economy
Qantas: 12 flights
However, if you look at the airlines on which I flew the most mileage, the ranking is a bit different due to some mileage runs:
American Airlines: 404,296 miles
Cathay Pacific: 104,481 miles
Qatar Airways: 89,630 miles
British Airways: 53,357 miles
Delta Air Lines: 49,603 miles
United Airlines: 42,237 miles
Singapore Airlines: 36,176 miles, including a review of Singapore Airlines’ A350-900ULR premium economy
Japan Airlines: 33,756 miles
Air Canada: 30,792 miles
All Nippon Airways: 28,938 miles
I track all my flights in OpenFlights. So, although it’s relatively easy for me to gather statistics on my flights, I don’t have a simple way to determine the amount I paid in points and cash for my 575 flights during the last six years.
Related: The best credit cards for booking flights
1,103 nights in hotels
I’ve spent over half of the last six years living out of hotel rooms. In particular, I’ve spent 894 nights at 75 major hotel brands within the last six years. And I’ve spent 209 nights at other brands and independent hotels.
Here’s the breakdown of my stays by loyalty program and brand over the last six years, including notes about my favorite programs.
390 nights at 15 IHG brands
Holiday Inn Express: 120 nights
Holiday Inn: 66 nights
InterContinental Hotels & Resorts: 51 nights, including five nights at the InterContinental Hayman Island Resort in Australia, four nights at the InterContinental Phuket Resort in Thailand, four nights at the InterContinental Phu Quoc Long Beach Resort in Vietnam, three nights at the InterContinental Danang Sun Peninsula Resort in Vietnam, three nights at the InterContinental New York Times Square in New York and two nights at the InterContinental Fiji Golf Resort & Spa in Fiji
Candlewood Suites: 28 nights
Hotel Indigo: 26 nights, including five nights at the Hotel Indigo Austin Downtown-University in Texas and four nights at the Hotel Indigo Birmingham Five Points South – UAB in Alabama
Staybridge Suites: 22 nights
Crowne Plaza Hotels & Resorts: 19 nights, including three nights at the Crowne Plaza Beijing Wangfujing in China and three nights at the Crowne Plaza Times Square in New York
Holiday Inn Resort: 19 nights, including 10 nights at the Holiday Inn Resort Kandooma Maldives in the Maldives
Voco: 11 nights, including six nights at Voco Gold Coast in Australia
Regent: Nine nights
Kimpton Hotels & Restaurants: Eight nights
Six Senses: Six nights, including four nights at Six Senses Laamu in the Maldives and two nights at Six Senses Yao Noi in Thailand
Atwell Suites: Two nights at Atwell Suites Miami Brickell in Florida
Avid: Two nights at Avid hotel Oklahoma City — Quail Springs in Oklahoma
Even: One night
Over the last six years, I’ve stayed 161 paid nights at IHG properties for an average of $152 per night. The least I paid was $48 per night at the Holiday Inn Express Berlin — Alexanderplatz in Germany. And the most I paid was $1,564 per night during a review of the InterContinental Maldives Maamunagau Resort in the Maldives.
Meanwhile, we redeemed IHG points for 209 nights over the last six years, including 36 fourth-night-free rewards. On average, we redeemed 15,591 IHG points per night. We also redeemed 20 anniversary nights over the last six years, including at the InterContinental Bora Bora Resort & Thalasso Spa in French Polynesia and the Kimpton De Witt Amsterdam in the Netherlands.
You might wonder how we earned so many IHG points and anniversary nights. We maximize IHG promotions to earn points on stays. And we often buy points during IHG points sales with a 100% bonus when we can do so for 0.5 cents per point. As for the anniversary night certificates, we both have multiple IHG credit cards, so we’ve each earned two anniversary nights for most of the last six years.
We frequently stay at IHG One Rewards hotels and resorts due to the high value we often get when redeeming IHG points. But, with the launch of the new IHG One Rewards program last year, we are also getting good value from the annual lounge membership you can select through IHG’s Milestone Rewards program after staying 40 nights in a year.
Related: 9 budget strategies for getting the most out of your points and miles
209 nights at other brands and independent hotels
These days, we usually stay at major hotel brands to earn and use elite status perks and benefit from the consistency provided by these brands. But we often stayed at independent hotels when we first hit the road as digital nomads in 2017. And even now, we sometimes find ourselves in a destination without major hotel brands or where staying at a property outside our brand loyalties makes the most sense.
For example, we couldn’t pass up staying in a twin cell at YHA Fremantle Prison in Australia and a robot hotel in Japan. Likewise, staying within Addo Elephant and Kruger national parks in South Africa let us maximize our time seeing wildlife in these parks.
We often book these stays through online travel agencies since we don’t have to worry about missing out on elite status benefits and earnings while staying at properties outside our primary brands. For example, we’ll sometimes book through credit card portals to use credits, like the $50 hotel credit each account anniversary year on the Chase Sapphire Preferred Card. And we’ll occasionally book through American Express Fine Hotels + Resorts to snag extra perks and use the prepaid hotel credit we get each calendar year as a perk of The Platinum Card® from American Express. We’ll also sometimes use Rocketmiles to earn American Airlines miles and Loyalty Points on our stays.
On average, I paid $83 per night on these stays. But, my least expensive night was $18 per night for a private room with a shared bathroom at Stella Di Notte in Belgrade, Serbia. And my most expensive night was $235 per night at the RLJ Kendeja Resort & Villas in Liberia during PeaceJam.
203 nights at 21 Marriott brands
Over the last six years, I’ve stayed 140 paid nights at Marriott properties for an average of $121 per night. The least I paid was $44 per night at the Four Points by Sheraton Bogota in Colombia. And the most I paid was $350 per night during a review of the Waikoloa Beach Marriott Resort & Spa in Hawaii.
Meanwhile, we redeemed Marriott points for 49 nights over the last six years, including six fifth-night-free benefits. On average, we redeemed 16,167 points per night on Marriott award stays. We also redeemed 14 free night awards we earned through Marriott credit cards and promotions over the last six years.
Related: Here’s why you need both a personal and business Marriott Bonvoy credit card
115 nights at 6 Choice brands
Ascend Hotel Collection: 54 nights, including 28 nights at Emotions All Inclusive Puerto Plata in the Dominican Republic, nine nights at Gowanus Inn & Yard in New York (no longer bookable through Choice Hotels) and three nights at Bluegreen Vacations Fountains in Florida
Comfort: 37 nights, including 19 nights in Japan
Quality Inn: 13 nights
Cambria Hotels: Four nights
Rodeway Inn: Four nights
Clarion: Three nights
Over the last six years, I’ve stayed 34 paid nights at Choice Privileges properties for an average of $93 per night. The least I paid was $54 per night at the Comfort Hotel Airport CDG in France. And the most I paid was $239 per night at Cambria Hotel New York — Times Square in New York.
Meanwhile, we redeemed Choice points for 81 nights over the last six years. On average, we redeemed 9,531 Choice points per night. I’ve found I can get excellent value when redeeming Choice points for unique redemptions and for stays in Japan, Europe and destinations that typically feature high paid hotel rates. So, as with IHG, we often buy Choice points during sales or through Daily Getaways promotions.
87 nights at 11 Hyatt brands and partners
I didn’t stay much with World of Hyatt until the program offered reduced qualification requirements and double elite night credits in early 2021. I earned Globalist status in 2021 for far fewer nights than is usually required, but I’ve prioritized maintaining it due to the on-site perks it provides.
I’ve stayed 53 paid nights at Hyatt properties for an average of $139 per night over the last six years. The least I paid was $24 per night at the Excalibur Hotel & Casino in Las Vegas. And the most I paid was $353 per night at Hyatt House New York/Chelsea in New York.
Meanwhile, I redeemed Hyatt points for 27 free nights over the last six years. I’ve found some excellent Category 1 Hyatt hotels that provide wonderful value on award stays. So, it isn’t surprising that I’ve redeemed 5,563 points per night on average and just 3,500 points per night for nine nights. Additionally, I redeemed seven free night certificates that I earned through Hyatt credit cards, Hyatt Milestone Rewards and the Hyatt Brand Explorer promotion over the last six years.
40 nights at 10 Wyndham brands
Days Inn: 10 nights
Ramada: Nine nights
Ramada Encore: Five nights
Microtel: Five nights
Club Wyndham: Three nights
Super 8: Three nights
Viva Wyndham: Two nights at Viva Wyndham Azteca — All-Inclusive Resort in Mexico
Baymont: One night
Howard Johnson: One night
Travelodge: One night
Over the last six years, I’ve stayed 29 paid nights at Wyndham properties for an average of $103 per night. The least I paid was $48 per night at the Days Inn Guam-Tamuning in Guam. And the most I paid was $200 per night during a review of the Viva Wyndham Azteca — All-Inclusive Resort in Mexico.
Meanwhile, we redeemed Wyndham points for 11 nights over the last six years. On average, we redeemed 9,068 points per night on Wyndham award stays. And we love getting a 10% redemption discount when we redeem Wyndham points as a benefit of our Wyndham Rewards credit card, as this brings an award night that would typically cost 7,500 points down to just 6,750 points.
32 nights at 6 Hilton brands
Over the last six years, I’ve stayed 18 paid nights at Hilton properties for an average of $130 per night. The least I’ve paid was $58 per night at the Hilton Jaipur in India. And the most I paid was $168 per night at the Hilton Niseko Village in Japan.
Meanwhile, we redeemed Hilton points for eight nights over the last six years, including one fifth-night-free benefit. On average, we redeemed 46,250 points per night on Hilton award stays. We also redeemed six Hilton free night certificates that we earned through Hilton credit cards over the last six years for excellent value at the Conrad New York Midtown, the Conrad Maldives Rangali Island and the Hilton Maldives Amingiri Resort & Spa.
The average amount we redeemed per night with Hilton Honors is significantly higher than with other hotel loyalty programs. This, combined with my struggle to get more than TPG’s valuation (0.6 cents per point) when redeeming Hilton points, is why I don’t frequently stay at Hilton brands despite having Hilton Diamond status through a Hilton credit card.
19 nights at 4 Accor brands
Ibis: 12 nights
Mercure: Four nights
Grand Mercure: Two nights
Ibis Budget: One night
Over the last six years, I’ve stayed 19 nights at Accor properties for an average of $56 per night. The least I paid was $36 per night at the Ibis Muenchen City Nord in Germany. And the most I paid was $84 per night at the Ibis Madrid Alcobendas in Spain.
8 nights at 2 Best Western brands
Best Western: Six nights
Best Western Plus: Two nights
Over the last six years, I’ve stayed eight nights at Best Western properties for an average of $78 per night. The least I paid was $57 per night at the Best Western Amsterdam Airport Hotel in the Netherlands. And the most I paid was $147 per night at the Best Western Plus Mountain View Auburn Inn in Washington.
452 nights camping
When I became a digital nomad in 2017, I didn’t think there was any chance I’d camp 452 nights in the next six years. And even three years ago, I’d only spent three nights tent camping for a concert at The Gorge in Washington state and three nights in a rental RV doing a relocation from Las Vegas to Denver.
But, as it became apparent the coronavirus pandemic would affect international travel for more than just a few months, my husband and I tried out a six-night RV relocation rental in July 2020. Then in August 2020, we decided to buy the same RV model we’d relocated.
When we bought our Class C RV, we expected we’d sell it as soon as international travel to most destinations became relatively simple again. But, we discovered we enjoy working remotely from our RV while in the U.S. We’ve now spent 440 nights camping in our RV since buying it — 97 nights in 2020, 234 nights in 2021, 80 nights in 2022 and 29 nights so far in 2023.
Nineteen nights in our RV have been free at locations (like select Walmarts, select Cracker Barrels and businesses that participate in Harvest Hosts) that allow RVers to stay overnight upon asking permission. We’ve also spent 37 nights sleeping in the driveways of friends and family while visiting them.
But we usually find paid RV campsites with power and water. We’ve paid for campsites on 393 nights as follows:
171 nights at city and county campgrounds ($32 per night on average)
133 nights at U.S. Army Corps of Engineers campgrounds ($27 per night on average)
66 nights at state park campgrounds ($34 per night on average)
37 nights at private campgrounds ($52 per night on average)
Four nights at national park campgrounds ($48 per night on average)
On average, we’ve paid $33 per night for our RV campsites. The highest we paid was $104 per night at Orlando / Kissimmee KOA Holiday in Florida. And the least we paid was $17 per night at Shady Grove Campground in Cumming, Georgia, during a half-off promotion.
Related: The cheapest place to stay at Disney World is a tent — so I tried it
443 nights with family and friends
One aspect my husband and I appreciate about being digital nomads is seeing our family more than when we lived in one place. Here’s a breakdown of our nights with friends and family over the last six years:
July 2 to the end of 2017: 32 nights
2018: 90 nights
2019: 83 nights
2020: 167 nights
2021: 29 nights
2022: 27 nights
So far in 2023: 15 nights
We spent significant time with each of our parents in March through August of 2020 as much of the world locked down. However, the nights since August 2020 are lower than pre-pandemic since we now stay in our RV (either in the driveway or a nearby campground) while visiting most friends and family members.
Related: 43 real-world family travel tips that actually work
104 nights in transit
Over the past six years, I’ve spent 101 nights in flight or sleeping in airports. I typically avoid overnight flights, but sometimes overnight flights are unavoidable (and they’re enjoyable if I book a lie-flat seat or luck into a row to myself in economy).
If I have an overnight layover at an airport, I’ll book a hotel if the layover is long enough and I can find a modestly priced hotel on-site or with a free shuttle. But sometimes the layover is too short, or it just doesn’t make sense to get a hotel. In these cases, I’ll usually sleep in a lounge — ideally one with a sleeping area or at least lounge chairs — or in a Minute Suites (or a similar type of space) that participates in Priority Pass.
I’ve also spent three nights on trains, including two on the Amtrak Empire Builder from Portland, Oregon, to Chicago and one on a Trans-Mongolian train from Ulaanbaatar, Mongolia, to Hohhot, China. I thoroughly enjoyed both experiences, so it’s surprising that I haven’t taken any other overnight trains in the last six years. However, low-cost flights on many routes served by overnight trains often make flying a more convenient and less expensive alternative.
Related: 11 of the most scenic train rides on Earth
90 nights in vacation rentals
Vacation rentals are the accommodation of choice for many digital nomads, especially those who stay in each location for at least a month and appreciate having their own kitchen. And I spent 39 nights in vacation rentals in 2017 after becoming nomadic July 2.
However, one particularly bad Airbnb experience in 2018 and an increasing interest in hotel elite status caused me to switch most of my nights to hotels instead of vacation rentals. I stayed in vacation rentals for 17 nights in 2018 and 20 nights in 2019. I only stayed in one vacation rental each in 2020 (for three nights), 2021 (for two nights) and 2022 (for two nights). And so far, I’ve only stayed in one vacation rental (for seven nights) in 2023.
On average, I paid $53 per night for vacation rentals across my six years as a digital nomad. My least expensive vacation rental was $17 per night for a private studio apartment in Da Nang, Vietnam, that I booked through Airbnb. And my most expensive vacation rental was $129 per night for a waterfront apartment in Auckland, New Zealand, through Hotels.com.
I’ll still stay in vacation rentals when they’re my best option. But I generally prefer to stay at hotels for consistency and to earn and use my elite status perks.
Related: When a vacation rental makes more sense than a hotel
259 cities in 52 countries and territories
Finally, let’s talk about destinations. Over the last six years, I’ve visited 259 cities in 52 countries and territories. Here’s a look at the number of nights I stayed in each:
1,253 nights: United States of America (including 318 nights in hotels or vacation rentals)
88 nights: Germany
69 nights: Japan
56 nights: Australia
54 nights: South Africa (including 32 nights in or near South African national parks)
36 nights: Dominican Republic
27 nights: Maldives, Thailand
24 nights: Spain
22 nights: Hong Kong, Malaysia
21 nights: New Zealand, Serbia, Vietnam
20 nights: Canada, Colombia, Italy
19 nights: India
18 nights: Netherlands, United Arab Emirates
16 nights: Singapore
14 nights: Bahamas, French Polynesia, Indonesia
13 nights: Fiji, South Korea
11 nights: Brazil, Mongolia
10 nights: China
Nine nights: Bulgaria, England, France, Pakistan
Eight nights: Bosnia and Herzegovina, Latvia, Liberia, Mexico, Sri Lanka
Seven nights: Greece, Guam
Six nights: Turkey
Five nights: Belgium, Marshall Islands
Four nights: Sweden
Three nights: Argentina, Chile
Two nights: Panama
One night: Ethiopia, Finland, Ireland, Northern Mariana Islands, Taiwan
As you can see, I would have spent the most time in the U.S. even if the coronavirus pandemic hadn’t kept me in the country for much of 2020 and 2021. And interestingly, even my most visited country outside the U.S. (Germany) accounted for just 88 nights across the last six years.
I also visited 14 other countries and territories before becoming a digital nomad. So, although I’m not striving to visit every country in the world, I’ve visited 66 different countries and territories so far. My husband and I are trying to visit a few new-to-us countries each year while also returning to some of our favorite destinations like Germany, Japan, South Africa, Australia and Hong Kong.
Related: The 18 best places to travel in 2023
Bottom line
I feel incredibly thankful for the last six years I’ve spent as a digital nomad. I’ve grown significantly as a person and content creator while traveling full-time.
And I’ve had some amazing experiences, including swimming with manta rays in French Polynesia and the Maldives, watching a sea turtle dig a nest and lay her eggs on a Florida beach, staying at some awesome resorts (Six Senses Laamu, Six Senses Yao Noi and Alila Fort Bishangarh immediately come to mind), and overnighting in second-class hard bunks on a Trans-Mongolian train.
But it’s not these epic experiences that keep me on the road. After all, I could enjoy many of these experiences on vacation. Instead, the daily things like being surrounded by languages I don’t know, enjoying delicious local foods and exploring new cities and neighborhoods on foot keep me attached to the digital nomad lifestyle.
As you’ve probably noticed, many people are traveling this summer. If that includes you, there are ways to save a bunch of money (and maybe a little sanity) while traveling this summer.
How can you navigate this high-demand travel environment while controlling costs and minimizing headaches?
Here are our top tips for travel this summer and how to overcome problems you might run into along the way.
Fly without breaking the bank
You’re not wrong if you think flights are more expensive.
Fares for summer travel have risen, sometimes dramatically, compared to both 2022 and 2019, according to data provided by the Airlines Reporting Corporation, a travel intelligence firm and ticket processor. The company says average fares were 9%-37% higher for the top 10 summer destinations, which include Yellowstone National Park and Hawaii. Flights are exorbitant to Europe this summer, too.
Fortunately, there are several strategies to reduce the cost of your flights.
Let the prices and availability decide your destination
If you want deals, this summer may be the one to let special offers inspire your next trip. Keep an eye on our flight deals, and book something that sounds interesting — either because of a good price or solid points and miles availability. The flexibility to go wherever the price is reasonable can lead to big savings.
Consider alternative airports
With prices on the rise, now is the time to be flexible and check all nearby airports.
For example, Houston and Chicago have two airports. The New York City area has three. It may even make sense to get to one city by flying to another before taking a short train ride for the rest of the journey, like flying into Philadelphia and catching a train up to New York. Strategies like this can help you get to your destination on a flight with better pricing or award availability.
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Expand your search for awards when your first attempt strikes out if you want to avoid the highest prices this summer.
Use positioning flights
Positioning flights are not realistic for every situation or trip, but they can often offer better award availability or pricing than those from your home airport.
Can you get to your destination for a lot less by starting in Seattle or Chicago, for example? Would adding another flight to a different airport ultimately save you money or miles?
Just make sure you leave enough time between flights to avoid any unnecessary travel headaches.
Book a backup plan
If you can’t get the flight you really want, book an alternative trip with that same airline. Then, get on the standby list for the flight you really want.
Plan your itinerary so you’re at the airport in time to get on that other flight. You can also monitor other flights and take advantage of same-day change policies.
Use up your points and miles
Summertime is a great time to use up points and miles you were hoarding. One of our big pieces of advice at TPG is to earn and burn those airline and credit card points and miles. You’ll maximize the redemption value if you can use them when cash prices are high, especially if you can find a mileage deal.
Fly on a holiday
Have you noticed that flights the day before Thanksgiving are extremely expensive, but flights on Thanksgiving morning are often cheaper? That’s because everyone wants to get to their final destination before the holiday.
This phenomenon plays out during some summer holidays, too, so look to fly the morning of the holiday to see if that lowers the price. Flying on July 4 is cheaper, generally, than flying on July 3 or July 6.
Get a hotel at the right price — and place
The good thing about hotels is that there are usually a lot of options. The bad thing about hotels is that there are usually a lot of options.
Having multiple properties to choose from can sometimes make the process of picking one feel overwhelming. However, if you have a stash of points, you can use those to narrow the field.
Here are our tips for locking in the right hotel for your trip.
Instead of burning cash, consider using your points
Just like with flights, points redemptions can make a lot of sense when hotel rates are high. Do you have Chase or American Express points you can transfer to a hotel program? Or are you sitting on a bunch of Marriott Bonvoy points? Several of us at TPG like to transfer our bank points, like Chase Ultimate Rewards points, to World of Hyatt for otherwise-expensive hotels (like the Park Hyatt Paris Vendome).
Book early and use a flexible cancellation policy
Booking a refundable hotel that seems right while you finalize everything else may be the way to go, even if you’re not 100% certain you’ll stay at that hotel. Avoid “pay now” rates in favor of a room that you can change or cancel without fees. Many award bookings allow you to cancel up to a couple of days before check-in, but always double-check the terms.
Use your elite status
Some hotel programs set aside rooms for elite members or will bump non-elite guests in favor of those with status if all the rooms are booked. Taking this a step further, travelers with top-tier Globalist status in the World of Hyatt program have a concierge who can help reserve properties. Take advantage of these perks if space is limited.
Additionally, your elite status may be the key to money-saving perks such as waived resort or parking fees, free breakfast and complimentary lounge access.
Discover similar locations
If you don’t need to be in a specific location, this may be the time to change things up a bit.
For example, if you’re seeking time on the beach, consider the panhandle of Florida or even the coast of Alabama instead of Miami and other popular parts of South Florida. Think of places that seem similar but may have better pricing if you’re running into sky-high rates.
Book directly
Instead of booking a room through a portal or online travel agency, reserve one directly with the hotel. By booking directly, you’ll likely have access to more flexible terms, as hotel cancellation policies are typically more forgiving. Additionally, if something goes wrong, you’ll have an easier time changing your itinerary since you’ll be dealing with the hotel directly instead of a third party.
Consider alternative accommodations
If you can’t find hotels that work for you, consider vacation rental platforms like Vrbo and Airbnb, as well as hotel-branded vacation rentals like Homes & Villas by Marriott Bonvoy, Mandarin Oriental Exclusive Homes and Accor-affiliated Onefinestay.
You can also go camping, glamping, stay in a “tiny home,” or rent a recreational vehicle for a few nights. There are even ways to use points to book vacation home rentals.
Score an affordable rental car
While not quite the same level of “car rental apocalypse” we saw in 2021, there are still some shortages of rental cars. There are already summertime sellouts happening in select leisure destinations. Hertz, as an example, is limiting one-way car rentals in Europe this summer due to supply constraints.
Even when vehicles are not sold out, demand (and prices) are still quite high, in part because car rental companies haven’t been able to completely replenish their fleets.
Planning ahead and leveraging your elite status can be the difference between getting a rental car and not getting one at all, according to Jonathan Weinberg, founder of AutoSlash.
Book first, plan later
Prices rise, and availability shrinks as you get closer to your travel dates. Take advantage of flexible car rental rules that usually provide a “pay later” option and book now, even if your plans aren’t finalized. Since car rental prices are up compared to pre-pandemic numbers, according to Weinberg, car rental prices may make or break some summer travel plans.
Use coupons or discount codes to save
If you’re a member of AAA or AARP, have a Costco membership, are a veteran or work for a large company with a car rental discount code, pull all of these levers. You might be eligible for discount codes you didn’t even know about.
Don’t despair if none of those reduced rates applies to you. AutoSlash can track prices and look for eligible coupon codes, too.
Leverage elite status
Having elite status with a car rental company can be the difference between getting a car and not — even if you have a reservation. That’s because cars are sometimes set aside exclusively for elite members.
Additionally, car rental program members can often skip the line at the counter and go straight to the lot, which can be what it takes to get one of the last vehicles. Luckily, you may already have a credit card that offers car rental elite status, which you could use to status match with other car rental loyalty programs.
Look beyond traditional companies and locations
Most people search for rentals at the airport with the standard companies. If you’re not finding good results, consider off-airport locations or try alternatives like Kyte, Turo and Silvercar.
Consider a longer rental
If you have trouble finding an available or affordable rental car, try adjusting the rental period. Here’s an example of how adding one day to trigger a monthlong rental cut the price by about $3,000:
Just know you should plan to keep the car for the full rental period, as returning the car early has an inherent risk of the car rental company charging a fee or adjusting pricing back to the daily rate. However, this avenue can unveil better prices and expanded inventory.
Visit national parks for less and without the crowds
The busiest national park in 2021 (Great Smoky Mountains National Park) saw 14.1 million visitors, according to statistics from the National Park Service. At the opposite end of the spectrum, Aniakchak National Monument and Preserve in Alaska saw just 145 visitors in 2021.
While the major parks are undoubtedly busy, there are still parklands that are less frequented than others, though you’ll still want to plan ahead.
Here’s everything to keep in mind for a national park adventure this summer.
Book in advance
Many parks require advance reservations for campsites and lodging inside the park’s boundaries.
How far in advance you can book varies, but these limited reservations fill up quickly at the more popular parks. Find out when reservations open for the date you want, and plan to book as soon as possible.
Stay outside the park
You might be dreaming of a night in a rustic cabin inside a national park, but getting that reservation could be challenging or costly, especially if you’re unable to pay for it with points.
However, just beyond the park, there’s probably a hotel where you can pay with points. For example, the SpringHill Suites just outside of Zion National Park is a great property if you have Marriott points to spend.
Make reservations
Some parks limit how many people can visit on any given day. Others place limits on how many people can go on a particular hiking trail. Some locations even require you to enter a lottery to get a chance to visit.
Apply for these permits and lotteries as early as possible for a better chance of securing access.
Avoid ‘free days’
It may sound counterintuitive, but “free days” at national parks may not be the best time to visit, as they tend to be particularly busy.
Instead of visiting on a weekend, holiday or day with free admission, aim for an early morning in the middle of the week for more elbow room on hiking trails and at can’t-miss natural wonders.
Visit alternative parks
Given the sheer number of national parks, national monuments, state parks and protected areas in the U.S., there’s likely a parkland near you that isn’t regularly packed with people. In fact, there may even be a park that offers similar geography to the one you’re considering but with a slightly more remote location and, consequently, thinner crowds.
For example, the second-largest canyon in the U.S., Palo Duro Canyon in the Texas Panhandle, sees 4 million fewer visitors per year than the Grand Canyon.
Plan for maximum enjoyment with minimum stress
You may have all types of activities in mind for this summer: theme parks, a road trip to visit grandparents or even an isolated beach getaway.
To cut down on travel headaches and bank account woes for the many trips you hope to take, consider these helpful tips.
Visit amusement parks on weekdays
While summer is a peak travel season since kids are out of school, many parents are still working Monday through Friday, meaning weekdays are generally less crowded. As a result, visiting a theme park in the middle of the week and arriving early in the morning typically leads to shorter lines for rides and shorter waits at in-park dining venues. It may even help you score cheaper tickets and lodging.
Ditch major theme parks
Growing up in Ohio, I had easy access to Kings Island and Cedar Point — two great theme parks that didn’t require flying to Florida or California.
Do as my parents did when I was a kid and look for regional parks that provide a lot of fun without the hefty price tag. Getting tickets will probably be easier, plus you may not need to add flights or hotels to the list of expenses.
Book Disney reservations early
You still need actual reservations (not just tickets) for Disneyland and Disney World.
To avoid any unexpected surprises, lock in your reservation as soon as possible to guarantee access to your preferred park, as they can sell out.
Reserve airport parking in advance
If flights and airports are packed, you can expect full parking lots, too.
Reserving airport parking ahead of time can be the difference between having a spot and not — or paying extra for the premium or far-away lot. If you aren’t having any luck finding a space at the airport, try snagging one at an off-airport parking location that offers shuttle service to the terminals.
Take a road trip
When you fly, you may have to buy four tickets for your family. When you drive, you don’t have to put gas in four cars.
The price of gas has come down lately, and a road trip may be calling your name this summer. An added bonus: Driving your own car means you won’t need a rental car at your final destination.
Look for coupons and codes
You don’t usually see Marriott or Delta Air Lines on Groupon, but activities are definitely more prolific.
Watch for coupons, group deals or sales for activities you’re planning to do during your trip. From roller coasters to roller derbies, the internet offers all kinds of deals, midweek sales and discount codes for activities that can lead to big savings. AAA, AARP and other advocacy memberships can help here, too.
Buy gift cards on sale
This tip can apply to many areas of life, but it’s especially true for theme parks and other activities.
Your local supermarket, big-box store or office supply store may sell gift cards at a discount. E-commerce sites also sell discounted gift cards.
When buying gift cards, use shopping portals whenever possible and pay with a card that will earn maximum points. Once you have your gift cards in hand (or your email inbox), use them to purchase Disney tickets, a hot air balloon ride or whatever activity you’re hoping to enjoy while on vacation.
Consider a cruise
While we’ve written about sold-out theme parks and hard-to-come-by flight deals, you should know that cruises are not quite as expensive as many other types of summer vacation. You’ll often save money when you account for the costs of flights and hotel rooms for multiple nights. With a cruise, you could simultaneously unlock serious savings and avoid crowds.
Hunt for deals
Cruise deals are not as plentiful as they were at the peak of the coronavirus pandemic. However, you can still find amazing deals on cruises. If you are flexible, sometimes cruise companies offer substantial deals on last-minute cruises if they have excess inventory (unsold cabins).
It’s not uncommon to see deals on cruises pop up, like this one back in March, but you need to act fast when you see them. Virgin Voyages has been offering some incredible deals this year, including a cruise for just 40,000 Virgin Atlantic points.
Look for bundles and packages
You may find that you can also save by bundling items. Search for deals on drink packages or onboard spending credits, or consider “kids sail free” options — even if the first number you see (the price for an adult) doesn’t look like a bargain right away.
Bottom line
Summer is here, and just like last year, prices and demand are through the roof.
It is possible, however, to avoid hordes of tourists if you’re looking for some peace and quiet. You may even be able to visit a popular destination without spending a fortune, having a 16-hour layover or coughing up all of your airline miles to get there.
Regardless of where you plan to go, flexibility is the best thing you can bring to your travel plans. You should book now (if you haven’t already) so you can make the most of your summer without breaking the bank.