Savings Account Archives - Hanover Mortgages

November 27, 2021

The Difference Between Current Balance and Available Balance

Numbers don’t lie, but they may play a trick or two.

And one of the most bothersome can be determining whether the current balance or the available balance on a bank account is the most correct. In actuality, they both are. A current balance is the amount of cash presently sitting in a checking or savings account at any given time. However, the available balance is the current balance minus any pending transactions that haven’t been fully processed yet.

Financial institutions provide both of these balances in an effort to provide account holders with the most detailed picture of their funds, however, it has been known to confuse many uninformed account owners. Understanding the differences between a current balance and an available balance is extremely important as it provides a clear guide for future spending.

What is Current Balance?

The current balance of an account is a reflection of the amount of funds that are moving throughout a checking account or savings account at any given time. This is a compilation of both credits and debits — incoming and outgoing funds — within an account. It includes transactions that have been completely processed on both ends and posted to an account.

Pending transfers or payments that have been authorized but have not been fully processed yet may be listed in your transaction history but are not included in the tally. So any debit card payments, mobile deposits, or automatic bill payments that haven’t been fully processed will not be calculated into the current balance.

For example, let’s say Brian’s checking account balance is $200. On Monday, his employer deposits an $800 payment into his account that clears and posts on the same day, raising Brian’s current balance to $1,000. On Wednesday, Brian uses his debit card to pay $100 for dinner, and the restaurant places a hold on his account for the amount. Because the payment is pending and awaiting processing, Brian’s current balance is still $1,000. However, if on Friday the restaurant charge is fully processed and posted onto his account, his current balance would drop to $900.

What is Available Balance?

An available balance is the current balance of a checking or savings account, minus any pending payments and deposits. At essence, it takes the total amount of all fully processed and posted credits and debits, and subtracts the total amount of any pending payments that have yet to be fully processed, providing a more accurate reflection of the money in your account that remains available to be spent.

For example, Danielle’s checking account balance is $500. She uses her debit card to pay a $100 internet bill, and her landlord cashes her $300 check for her rent — both payments appear on her account as pending. Despite her current balance being $500, her available balance is only $100 due to the pending payments. If she were to make other payments totaling more than $100, she will risk an overdraft fee.

Recommended: Different Types of Savings Accounts You Can Have

What is the Difference Between Current Balance and Available Balance?

If an account goes a week or two without any activity, its available balance and current balance will likely be in sync. However, once purchases and payments are made with a debit card, that is when the available balance is likely to fluctuate.

The key difference between a current balance and an available balance is “promised payments.” A current balance is the total amount of money in an account including money that has been promised to other people or businesses. An available balance, on the other hand, is the specific amount of money available that has not been promised to any person or business. While spending the full amount of a current balance with pending payments could result in overdraft fees, spending the full amount of an available balance will not.

Generally, when a current balance and available balance differ, the available balance is the lower of the two, and it’s nearly always due to a pending payment. In some rare cases, however, an available balance may appear larger than the current balance. This could be due to receiving a refund from a purchase or the reflection of a bank overdraft protection buffer on an account. Either way, in this case, it would be wise to contact your bank for a better understanding of your current account standing.

How Long Does It Take for a Current Balance to Become an Available Balance?

The amount of time it takes for an available balance to sync back up with a current balance depends on the specific amount of processing time needed to complete each pending transaction, and those times can vary depending on the type of transaction and how quickly the establishment processes it. The account holder’s ability to refrain from spending with their debit card and adding more pending payments to the account is also a major factor.

As a general rule of thumb, individual pending payments can take as little as 24 hours, or as long as 3 days to be completely processed and posted to an account. The process requires communication and confirmation between the banks of the account owner and the establishment they purchased from. If a transaction remains pending for up to a week, that is when it would be wise to contact the merchant or your bank for clarity.

Which Balance Should I Rely On?

The current balance and available balance each serve their own purpose and both can be relied upon as an accurate representation of a checking or saving account. However, there are specific instances when it would be better to reference one over the other.

If you’re planning on making a purchase or withdrawal, that is an instance where it would be more beneficial to reference the available balance on your account. It’s the best way to know exactly how much money is available to be spent without disrupting any other pending payments. Checking the available balance will give the most exact account of what is freely available to be spent and will also help you avoid incurring any overdraft fees.

If you’re more interested in your account balance as a whole and how much money you have flowing through your account at any given time, that is when you’ll want to reference your current balance. It accounts for every dollar entering and exiting your account at the very moment you check it. Do keep in mind, however, that the available balance total may change quickly due to any sudden pending transactions, therefore it would be wise to check it daily for the most up-to-date tally.

Recommended: How Often Should You Monitor Your Checking Account?

The Takeaway

Knowing what your account balances mean and how to interpret them is a basic financial skill that can literally save you money. Even the slightest misinterpretation of the two could result in costly overdraft fees and disrupt your financial goals.

SoFi Money® is a cash management account that can help you keep tabs on your cash and help you reach your financial goals. You can save, spend, and earn all in one account with no account fees.

Check out SoFi Money.

Photo credit: iStock/fizkes

SoFi Money®
SoFi Money is a cash management account, which is a brokerage product, offered by SoFi Securities LLC, member FINRA / SIPC . Neither SoFi nor its affiliates is a bank. SoFi Money Debit Card issued by The Bancorp Bank.
SoFi has partnered with Allpoint to provide consumers with ATM access at any of the 55,000+ ATMs within the Allpoint network. Consumers will not be charged a fee when using an in-network ATM, however, third party fees incurred when using out-of-network ATMs are not subject to reimbursement. SoFi’s ATM policies are subject to change at our discretion at any time.
The SoFi Money® Annual Percentage Yield as of 03/15/2020 is 0.20% (0.20% interest rate). Interest rates are variable subject to change at our discretion, at any time. No minimum balance required. SoFi doesn’t charge any ATM fees and will reimburse ATM fees charged by other institutions when a SoFi Money™ Mastercard® Debit Card is used at any ATM displaying the Mastercard®, Plus®, or NYCE® logo. SoFi reserves the right to limit or revoke ATM reimbursements at any time without notice.
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Source: sofi.com

November 26, 2021

CIT Bank Review 2021

When it comes to banking, most of us are just looking for something convenient and free … but it’s that much better when your checking account can actually help you earn money, too. For that, CIT Bank is your answer.

If you’re willing to move to an online banking system — that is, one where your account is entirely online and you don’t have access to a brick-and-mortar banking location — CIT Bank offers both checking and savings accounts with no monthly fees and high interest earnings potential. There is a minimum opening deposit of $100, though it’s pretty reasonable given the bank’s high rates.

Although foregoing the in-person franchise can be a little daunting, CIT Bank makes it that much easier by offering up to $30 in third-party ATM fee reimbursement per month, and you’ll never be assessed an ATM fee on their end. However, if you’re looking for a bank that also offers small business accounts, you’ll want to keep looking (try these business checking accounts); CIT doesn’t have business checking or savings accounts available.

Here’s what we love about each of CIT Bank’s online deposit accounts and what we think could use some work.

CIT Bank Checking Account

CIT Bank has one checking account option which has a lot of perks, including no monthly fees and the ability to connect the account with the high-yield savings account. CIT does still charge overdraft fees but they can be avoided if you sign up for the protection plan.

CIT Bank eChecking Account

Best for Digitally-Savvy Users

Key Features

Interest earning
Connects with high-yield savings
Charges overdraft fees

4 out of 5 Overall

CIT Bank combines the best of both possible worlds when it comes to checking: an account with no monthly fees and the ability to earn interest. Their eChecking account earns up to 0.25% APY on balances with $25,000 or more, and 0.10% APY on balances less than that. (That’s better than the average savings account interest of 0.03% APY, per the FDIC.)

CIT Bank eChecking Account

APY

Up to 0.25%

Monthly fees

ATM access

None, but reimbursement up to $15

Minimum starting balance

$100

The checking account requires a minimum opening deposit of $100, and certain fees can be assessed under specific circumstances. For instance, if you make an outgoing wire transfer and carry an average daily balance of less than $25,000, it will cost $10. CIT Bank’s insufficient funds fee is $30, and no daily limits are advertised.

Still, these fees are relatively easy to avoid, especially given CIT Bank’s free overdraft protection option. They also avoid charging their own ATM fees when you withdraw money, and you can receive up to $30 per month in third-party ATM fee reimbursements.

When you sign up, CIT Bank will send you a complimentary debit card with EMV chip technology, but if you’re looking to use physical checks, keep moving. The mobile app allows you to easily deposit checks made out to you, but doesn’t allow you to write a check from this account.

Finally, we love the way the eChecking account connects with CIT Bank’s new high-yield savings account, Savings Connect Account, to maximize your savings. We suggest you take a look at signing up for both simultaneously.

CIT Bank Savings Accounts

CIT Bank provides customers with three savings account options:

Savings Builder
Money Market
Savings Connect

All carry a minimum opening deposit between $100 to $200, but none assess monthly fees.

CIT Bank Savings Builder

Best for Monthly Savers

Key Features

No monthly fee
Daily compounding interest
Up to .40% APY

3.5 out of 5 Overall

The Savings Builder account allows account holders to earn up to .40% APY depending on their average daily balance and/or monthly deposit behavior; if you keep a balance of at least $25,000 or make at least one monthly deposit of $100 or more, you’ll earn the .40% APY maximum. Interest compounds daily to maximize earning potential, and deposits and transfers can be made through the mobile app.

CIT Bank Savings Builder

APY

Up to 0.4%

Monthly fees

ATM access

None

Minimum starting balance

$100

The Savings Builder account is a decent option for a high-yield savings account, boasting rates over 6X the national average. If you jump through the tiered interest hoops, then you can walk away with 0.40% APY, but if you’re looking to just put your money in and sit, you’ll most likely receive the lower-tiered rate of 0.28% APY (unless your balance is more than $25,000).

Basically, if you need motivation to save money monthly for a goal like a house or college, the reward of earning higher interest with a Savings Builder account might be just the trick. In fact, right now, the Savings Builder account offers the higher-tiered interest as a special introductory rate for your first period regardless of balance or savings. So if you’re thinking this is the right savings account for you, you’re at least guaranteed 0.40% for one cycle.

Overall, however, we think CIT Bank’s other savings accounts are worth taking a look at for slightly higher APYs and a little less fuss.

CIT Bank Money Market Account

Best for No Fuss Saving

Key Features

No monthly service fee
Up 0.45% APY
Scheduled bill pay feature

4 out of 5 Overall

The Money Market account earns 0.45% APY without any fees regardless of account balance or deposits, and its interest, like the Savings Builder account, is also compounded daily.

CIT Bank Money Market Account

APY

0.45%

Monthly fees

ATM access

None

Minimum starting balance

$100

Coming in at 0.45% APY, CIT Bank’s Money Market account is definitely a strong contender among online banks’ savings options. Unlike the Savings Builder account or Savings Connect account, Money Market has no hoops to jump through. You just put your money in and receive the 0.45% APY. Combined with no monthly fees, we love the ease of earning it offers.

Unlike some other money market accounts, CIT Bank’s Money Market account is limited to electronic transfers only. You can arrange a direct deposit, bill pay, and check cashing on its great mobile app, but there’s no corresponding debit card or checks.

Like the Savings Builder account, the Money Market account is also limited to six transactions a statement cycle with a $10 for each additional excessive transaction. But we think for most, these little inconveniences are worth the high annual percentage yield.

CIT Bank’s Savings Connect account has no monthly fees and a solid APY. You have to open a Savings Connect account and an eChecking account and CIT Bank will link them. If you already have an eChecking account, then CIT Bank will link them automatically.

CIT Bank Savings Connect Account

Best for eChecking Users

Key Features

No monthly service fee
Up 0.50% APY
Linked to eChecking account

5 out of 5 Overall

CIT Bank’s new Savings Connect account allows you to connect this savings account with your CIT Bank checking account—again, with no monthly service fee. To qualify, you must open a Savings Connect account and an eChecking account and deposit $100 in each. Once connected, Savings Connect account holders can earn up to 0.50% APY with a qualifying monthly deposit of $200 to their checking account.

CIT Bank Savings Connect Account

APY

Up to 0.50%

Monthly fees

ATM access

None, but reimbursement up to $30

Minimum starting balance

$100

From there, to earn the highest tiered APY, you simply have to set up an automatic deposit of $200 or more into your linked checking account from your Savings Connect account. This monthly deposit locks in 0.50% APY for the cycle. If you don’t meet this requirement, you’ll still bring home 0.42% APY for simply having the linked accounts, which is a more than respectable APY.

Besides a good APY, a linked Savings Connect account gets you access to a debit card and overdraft protection. For the debit card, the same rules apply as before with no CIT Bank ATM fees and other ATM fee reimbursements up to $30 a month.

Some people might find opening two accounts a bit annoying, but the high APY makes it a great option for most who are looking for a fully online banking experience.

Other CIT Bank Products

While we mostly come to CIT Bank for the savings and checking accounts, it doesn’t stop there. Check out the other services available from CIT Bank that might fit your needs below.

Certificates of Deposit (CDs)

CIT Bank offers three different CDs for new customers seeking to hit their savings goals:

Term CDs
No Penalty, 11 Month CDs
Jumbo CDs

CIT Bank’s CDs work pretty much like other standard CDs with varying rates and lengths. The Term CDs offer between 0.30% to 0.50% APYs depending on the CDs term. There’s no maintenance or opening fee, but it does have a $1000 minimum.

The No Penalty 11 Month CDs also have a $1,000 minimum but can be accessed early with no penalty—that flexibility, however, costs you a little APY with rates of 0.30% APY.

With a $100,000 minimum, the Jumbo CDs are definitely channeling a specific type of customer. These term lengths are longer—between 2 to 5 years—and have 0.40% – 0.50% APYs depending on the length.

It is worth just mentioning that previous customers do continue to have access to their RampUp CDs, but they’re not offered to new customers.

So do we believe CIT Bank CDs are worth it? CIT Bank’s CDs are a solid option for CDs; however, there are CDs on the market with better rates and lower minimums, so we’ll probably stick to CIT Bank’s savings and checking accounts.

Pro Tip

Check out our current list of bank promotions for a chance to gain a monetary bonus when signing up for a new bank account.

Home Loans

CIT Bank offers home loans with relationship pricing options:

.10% with 10% of the loan amount in new deposits
.20% with 25% of the loan amount in new deposits.

Plus, you can get $525 cash back deposited into your CIT Bank account after you close on your new home loan with CIT Bank.

CIT Bank Custodial Accounts

If you’re looking to grow wealth for a minor, CIT Bank can help you open a Custodial Account. You can set up most of the savings accounts in the minor’s name for them to gain control of at 18. With some federal tax benefits and no maximum limit, it makes a great place to save for the future.

Small Business Banking

CIT Bank focuses on personal accounts and doesn’t offer small business checking and savings accounts. They do have some small business financing options, specifically focusing on Equipment, Working Capital, or Franchise financing. The terms vary in length and rates, but all can be funded in as fast as 1 day.

CIT Bank Mobile App

Like most online banking options, CIT Bank’s mobile app provides digital solutions to help its members access and manage their funds from the convenience of their smartphones. Its mobile apps are well received, with ratings of 4.2 stars on Google Play and 4.6 stars on the Apple App Store.

The apps allow users to make transfers between their own accounts (and to others using third-party platforms like Zelle and Samsung or Apple Pay), as well as to make mobile check deposits using the onboard smartphone camera.

Pros and Cons of CIT Bank

So what’s the breakdown of CIT Bank overall? Below, we’ve laid out the pros and cons of CIT Bank to help you streamline your decision.

Pros

Free eChecking account earns interest at a rate higher than the average savings account.
No monthly fees on any of its deposit accounts.
Free overdraft protection.
Competitive APYs.
Low minimum deposit requirements.
Refunds ATM fees up to a certain amount.

Cons

Insufficient funds fee of $30 per transaction item.
No physical locations and no ATMs for the actual service.
No small business banking option.

Frequently Asked Questions (FAQs) About CIT Bank

Still have a few questions? Below we’ve tracked down the answer to the most common questions people ask about CIT Bank.

Is CIT Bank FDIC Insured?

Absolutely. All CIT Bank savings and checking accounts are FDIC insured against bank failure and theft. You should feel safe and secure using CIT Bank, knowing it’s backed by the FDIC.

Does CIT Bank Offer Loans?

CIT Bank does offer home loans and small business financing with relationship pricing mortgages and competitive rates.

Who Owns CIT Bank?

CIT Bank is owned by the CIT Group Inc, a North American financial holding company.

Jamie Cattanach and Whitney Hansen are contributors to The Penny Hoarder. Both are experienced writers in personal finance, banking and investing.

Source: thepennyhoarder.com

November 24, 2021

Ando Money Lets You Fight Climate Change â And Get Paid Two Days Early

The United Nations calls climate change “the defining crisis of our time.” In a culture obsessed with instant gratification — and with world leaders caught up in the politics of it all — the rest of us can be left feeling helpless about it.

What exactly can we do to have an impact? Stick expensive solar panels on the roof? Switch to a plant-based diet? Take shorter showers?

Of course, all these endeavors are worthwhile, but there’s a surprisingly simple move you can make to have a big impact on fighting climate change: changing where you bank.

Banking’s dirty secret is that banks are huge contributors to the climate crisis, investing trillions of dollars of their customers’ deposits into fossil fuels.

That’s why we like Ando, an online banking platform that only invests in companies that are directly fighting climate change. On top of that, Ando lets you get paid two days early and never charges a fee for any of its features.

How Switching Where You Bank Can Fight Climate Change

Ando is a state-of-the-art mobile banking platform with all the features you’d expect in today’s digital-first world. Once you set up direct deposits, it won’t charge you any fees for anything, ever. Here are some of our favorite features:

Get paid two days early: When you get paid via direct deposit, you can access those funds up to two days early. Unlike many financial institutions, Ando gives you access to your money when you need it.

No overdraft fees: Unlike virtually all the brick-and-mortar banks, Ando doesn’t charge you for overdraft protection.

Checking account: Ando comes with a Visa Debit Card with no minimum deposit required and easy remote deposits and digital payments.

Referral bonuses: Invite up to five friends to join Ando, and you can boost your savings account interest rate up to 5% APY. Plus, you and each friend can earn up to $15 with Ando friend referrals.

ATMs: You can get cash with your debit card at more than 34,000 ATMs across the country with no fees. There’s a $2.95 fee for out-of-network ATMs.

Customer service: Available seven days a week via email or phone.

Insured: Money in your Ando account is FDIC-insured for up to $250,000.

How the Other Guys Use Your Money

Where do most banks invest your deposits — more than 90 cents of every dollar? Fossil fuel companies and their ultra high polluting projects. They’re using your money to contribute to the climate crisis.

“Most people don’t realize that the money we have on deposit is utilized by the bank to make loans and purchase securities,” says Ando’s founder, JP McNeill. “This is how traditional banks make money.”

The big banks are largely bankrolling the fossil fuel industries, to the tune of nearly $3 trillion in the last five years alone.

Where does Ando invest your deposits? Clean, renewable energy, sustainable transportation, regenerative agriculture and green buildings. Ando invests exclusively in green initiatives and is 100% transparent as to where those investments are made.

How to Get Started

For too long, you’ve had no control over how your bank uses your hard-earned money. Now there’s something you can do about it. Sign up with Ando via their app, which is available for iOS or Android.

Mike Brassfield ([email protected]) is a senior writer at The Penny Hoarder.

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Source: thepennyhoarder.com

November 24, 2021

Accredited Debt Relief Review

You’ll also need to stop using credit cards or drawing on that line of credit. This will help the debt relief program negotiators build your case.
For people who are drowning in credit card debt and dodging phone calls from creditors, it’s easy to feel trapped. Helpless.
Accredited Debt Relief is working with him on a debt-settlement plan and has been negotiating his credit card balances down by 50%.
Source: thepennyhoarder.com
How long this process takes varies, but the average person enrolled in the program is debt-free within two to four years.
If you have at least ,000 in unsecured debt, meaning there’s nothing your lenders can repossess, such as a car, this debt relief company can help. You can get help paying off payday loans, credit card debt, medical bills, personal loans and other unsecured loans — student loans are excluded.

So, What Is Accredited Debt Relief?

An Accredited Debt Relief debt specialist reviews each person’s individual situation — the initial consultation is free — and figures out the best path out of debt, whether that’s a debt settlement or one of their debt-relief programs.
Ready to stop worrying about money?
He bought and started remodeling a duplex in Olympia, Washington. To save money, he tried doing it himself with a home renovation loan, but he still ended up owing tens of thousands of dollars to his Home Depot and Lowe’s credit cards.
By the time he reached out to Accredited Debt Relief in late 2019, he was ,000 in the hole.
Get the Penny Hoarder Daily “That’s how I got into this spot,” he says. “It wasn’t that we were out buying Gucci or designer threads or anything like that. I was just trying to do right by my family.”
Then, the negotiators will work with the creditors to secure a settlement, a lump sum that’s less than the owed amount. That’s how they save people money. Once you approve the deal, you’ll pay the settlement out of your savings account.
The only other requirement for Accredited Debt Relief’s debt consolidation program is a stable source of income. You’ll need to consistently make your monthly payments in order to qualify for their debt relief options.
Accredited Debt Relief generally works with people who owe more than ,000. The idea is to help people out of debt without declaring bankruptcy.
The truth is, many Americans are in the same predicament. But there are ways out, including debt relief.
When Smith retired from the U.S. Army after 21 years, he was ready to try something different, so the married father of three got into real estate investing.

Pros and Cons of Accredited Debt Relief’s Service

Like what you learned in this Accredited Debt Relief review? It takes less than a minute to sign up for a free initial consultation.

Pros:

They work with a wide variety of unsecured debt: medical bills, payday loans, debts owed to credit card companies and much more.
Accredited Debt Relief’s clients get out of debt in 46 months on average.
They offer free consultations on debt relief.
They have an A+ rating from the Better Business Bureau and are accredited by the American Fair Credit Council.
Debt settlement with Accredited Debt Relief may be as low as 50% of what you originally owed.

Cons:

Secured debts and student loans aren’t eligible for Accredited Debt Relief’s program.
You’ll need to owe at least $10,000 in order to qualify for debt relief.
It’s not available in every state.
Not everyone qualifies for a debt settlement.

Frequently Asked Questions

Is this a debt-settlement program?

Take Kerry Smith, for instance. He was a Green Beret who did four combat tours in Iraq and four more in Afghanistan. He fought terrorists and insurgents, dodged grenades and roadside bombs.

What if a creditor won’t work with Accredited Debt Relief?

After he retired from the Army due to combat wounds, Smith, now 42, tried his hand at real estate. But he got overwhelmed with ,000 worth of debt from deals that went south.

How much will a debt-relief program cost me?

Accredited Debt Relief doesn’t directly service the following states: CT, DE, GA, HI, IL, KS, ME, ND, NH, NJ, OR, OH, RI, SC, VT, WA, WV and WY.

How This Green Beret is Saving $700 a Month on His Debts

If you or someone you know is in serious debt, Accredited Debt Relief deserves serious consideration. If you qualify, it can help turn finances around and help you reclaim your life from debt.
There’s a lot to like about Accredited Debt Relief’s service, but why should you go with them instead of one of the other debt relief companies? Check out the pros and cons of this service, compared to other debt relief companies, to see why you should pick their pathway out of serious debt:
Looking for help, he found a debt relief company called Accredited Debt Relief. He was wary of scams and ripoffs, but he decided to give it a try because of its A-plus rating from the Better Business Bureau.
Still, it’s worth it for Smith and his family and is a huge relief. He’s making his monthly debt payments to Accredited Debt Relief instead of his creditors, which leaves him more money to take care of his family.
Your monthly payments won’t go to any creditor that declines to work with you on debt settlement. Many other debt-relief companies ask for payment before an agreement is reached.
Yes, Accredited Debt Relief’s certified debt specialists will work with your creditors to negotiate a lower amount on the debt you owe.
Fees range from 15% to 25% of the debt you owe. Accredited Debt Relief won’t charge you until after you’ve been enrolled in the debt settlement program and your creditors have come to terms.
The company charges for its services. For debt settlement, it typically charges 18% to 25% of the total debt, which is standard in the industry.
This debt-relief program is all about setting people up for future success. That’s why it’ll have you open a savings account in your name that you’ll control. That’s where you’ll send monthly deposits that’ll go toward paying off your debts.
While Accredited Debt Relief can help consolidate your debt into a single monthly payment, their debt relief services don’t require a good credit score or personal loans.
They’ll explain all the options and spell out a strategy for lowering your payments and maximizing savings.
“I started missing payments, and then it was a massive snowball,” he says. “It was just a maelstrom of different things in my life.”

Getting Started With a Free Consultation

In this Accredited Debt Relief review, you’ll find out how this company works and why this retired vet has been floored by how much of a difference it’s making.

Everyone’s debt is unique, and paying it off involves a lot of strategy.
Privacy Policy
“I give them 0 a month, which is 0 less than I was paying before,” he says. “We haven’t been getting any more phone calls from creditors — which is nice.”
Accredited Debt Relief creates custom debt consolidation plans for people who have serious debt and have trouble making payments. The company works with each client to create a personalized repayment plan.
If you meet the basic requirements, you could notice your credit score start to rise after you start making consistent payments through Accredited Debt Relief. <!–

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Accredited Debt Relief’s reviews are overwhelmingly positive, and the numbers don’t lie — this company has a track record of getting people out of serious debt in just a few years.

November 22, 2021

The Best Banks for Freelancers Keep Up with Unique Challenges

Making money as a freelancer can be hard enough — but then you have to figure out how to manage it.

With a slew of bank account options out there, it can be difficult to narrow down all the financial institutions and determine the best place to stash that hard-earned cash, especially if your financial lifestyle is a little less regular than most 9-to-5 workers’.

To help, the Penny Hoarder team has put together this post to compare some of the best bank accounts for freelancers. That way, you can make an informed decision with minimal fine-print reading.

What Is a Freelancer?

Before diving into the top banks for freelancers, it might be helpful to explain just what’s meant by “freelancer.” In short, a freelancer is someone who does work on a per-task or per-project basis and is paid by the task. Freelancers are self-employed and they don’t receive medical benefits or other perks such as vacation or sick time like company employees do.

Freelancers typically work for several companies, called clients, as independent contractors. The term often has a creative connotation — fields like writing, editing, web design, or photography — but there are exceptions.

What Makes a Business Bank Account Ideal for Freelancers?

Since freelancers are self-employed, they have some additional needs and responsibilities that the average full-time employee might not. For example, freelancers need to pay taxes themselves — nothing is withheld from their paychecks automatically.

Additionally, since freelancers are self-employed, they can count a number of purchases as business expenses, and keeping track of these is important for tax purposes.

Here are the major features to consider when choosing bank accounts as a freelancer:

Fees: Nobody wants to pay money just to keep their money, especially when you have a variable income. Ideally that means no monthly fee and unlimited transactions.
Customer Service: Knowing you’ve got a reliable team on your side when you have questions or concerns is vital.
Accessibility: Since freelancers often work out of their own homes and remotely, accounts that are tech optimized, with intuitive online banking options and high ATM or branch availability, are generally best. ATM access is especially important for cash deposits.
Business Account Offerings: Don’t forget to look at business account offerings for each bank, which can be helpful if you decide to incorporate your business or start an LLC.
Mobile-friendliness: A usable mobile app is extremely important, especially for banks that don’t have brick-and-mortar locations.

Help with budgeting and money management will also earn bonus points since everything’s a bit more complicated when you aren’t relying on a regular paycheck. However, these are nice-to-have features, rather than necessities.

Taking into account these features, we have rounded up the best banks — and in once case a well-known online payment system — for freelancers.

The 4 Best Banks for Freelancers

Bank	Top Feature	Prime Perk
Axos Bank	Selection of accounts	Generous support hours	SEE DETAILS
Chase Bank	5,100 branches	Support options	SEE DETAILS
PayPal	Free business account	Invoicing features	SEE DETAILS
Lili	Freelancer friendly	Top notch on mobile	SEE DETAILS

Axos Bank

Best for Online-First Banking

Key Features

Lots of experience in online banking
Generous support hours
Wide selection of accounts

4 out of 5 Overall

Axos was one of the original online-only banks from way back in 2000. As such, it has a unique understanding of what it means to be online-first — ideal for freelancers who consider themselves digital nomads. Axos offers a number of solid personal bank account and business bank account options, as well as fee-free IRAs and other useful services for freelancers.

Axos Bank

Fees

Business checking accounts available with no monthly fee and low or no minimum balance requirements.

Customer service

Business customers can get help weekdays from 6 a.m. to 6 p.m. PST.

Accessibility

There are no branches, and ATM fees are only reimbursable for certain partner institutions.

Business bank account options

Plenty of account options with high interest rates.

Mobile-friendliness

Mobile apps for iPhone and Android.

Axos offers relatively high-yield checking accounts on both the personal and business sides. Their personal savings account offers up to 1.3% APY, and their business interest checking account earns 0.8% APY. That makes it one of the best business checking accounts available for freelancers (or anyone else, for that matter) that want their money to earn interest.

However, if you’re used to in-person banking, Axos might not be for you. Although they offer ATM fee reimbursement at specified locations, you won’t be able to walk into a branch and speak face to face with a teller.

Chase Bank

Best for a Traditional Business Checking Account

Key Features

Physical locations nationwide
Useful support options
Variety of business accounts

4 out of 5 Overall

If you want brick-and-mortar access to your business checking account, Chase might offer the best bank accounts for freelancers among the big national players with the Chase Business Complete Banking. It regularly offers new subscribers large opening bonuses, carries low minimum deposits, and offers a number of ways to waive its already-low maintenance fees. You can open personal checking accounts

Chase Bank

Fees

Monthly fees can be waived in account minimums met.

Customer service

You’ve got all the options: email, phone and walking into a branch.

Accessibility

More than 5,100 branches nationwide and 16,000 ATMs.

Business bank account options

Lots of different options though eligibility depends on where you live.

Mobile-friendliness

Online banking and a mobile app mix real-world and on-the-go banking. Mobile check deposit handy.

As a major financial institution, Chase also offers a host of business bank accounts and tools, including merchant services that make taking credit card payments easy — even if your brand of freelancing has you out in the world and not constantly behind a computer screen.

Chase also offers a discount for those who sign up to use ADP payroll, which could be useful if you go the S-corp route (or have an employee or two). All together, the Chase business checking account is an excellent option.

To learn more, read our Chase Bank review.

PayPal

Best for Accepting Payments

Key Features

Business banking with no monthly fees
Built-in invoicing and payment features
Fast transfers to other accounts

3 out of 5 Overall

Okay, this one isn’t really a bank and you know it as a digital payment system. But PayPal’s business account upgrade has a lot of useful features for freelancers, including built-in invoicing and an easy-to-use app with mobile check processing. Even if you have a standard bank account, it’s worth having a PayPal account as a freelancer, since many clients will want to use it to process payments.

PayPal

Fees

Minor and mostly possible to get around, except in the case of invoicing.

Customer service

Excellent and readily available, both online and via phone.

Accessibility

While there’s no such thing as a PayPal branch, it’s easy to move funds to other bank accounts.

Business bank account options

PayPal offers a free upgrade from personal to business accounts, adding a host of tools.

Mobile-friendliness

Intuitive and user-friendly, both in a web browser and via mobile app.

There’s no monthly fee with a PayPal business account, though you may pay fees for certain types of transfers. (It’s free to transfer funds to your personal bank accounts as long as it’s not a rush, however.) There’s also a cost to the business owner when invoices are paid — PayPal’s fee is 2.9% plus 30 cents per transaction. This is fairly standard for the payment processing industry, though.

Lili

Best All-In-One Solution

Key Features

Built-in expense and tax tracking
Handy referral program
Unlimited transactions with no monthly fee

4 out of 5 Overall

Lili is a tailored checking account that aims to help tackle the unique challenges that come with freelancing. As a freelancer, there are a number of financial tasks that are entirely up to you to handle, like setting aside money for taxes. Lili promises to help with a dedicated business checking account. The app, available for iOS or Android, is laser-focused on specific freelancer needs.

Lili

Fees

None.

Customer service

Standard phone support and a useful online help center.

Accessibility

No physical locations, but access to 32,000 free ATMs across the country.

Business bank account options

Solid — it’s designed for freelancers, after all.

Mobile-Friendliness

This is a mobile-only bank, and the mobile app is quite good.

The Lili business checking account comes with its own Visa debit card. Whenever you spend any money, you’ll get a push notification asking you to swipe left or right to instantly categorize the expense as either “personal” or “business.” At tax time, this will allow you to easily maximize your expenses and reduce your taxable income, lowering your tax bill.

Even better: You can earn cash by referring up to 10 friends to join Lili. Once they sign up and spend $250 on their Lili card in the first 45 days, you’ll each get $100. You can also earn a $50 bonus when you open a Lili Pro account and spend at least $1,000 with your debit card within 60 days.

Frequently Asked Questions (FAQs) About Bank Accounts for Freelancers

Which Bank Account is Best for Freelancers?

While it really depends on your needs, the best bet for most freelancers is combination of Chase or Axos (Chase if you want physical branch access for cash deposits, Axos if not) and PayPal, the payment system fintech that’s built for business. This gives you a feature-rich business checking account and the additional payment options of a PayPal account.

Which Bank is Best for the Self-Employed?

Chase (specifically Chase Business Complete Banking) tends to be the best option overall for self employed bank accounts due to the presence of thousands of physical locations, as well as a solid online experience. This gives the most options to the widest possible group of self-employed individuals.

Do I Need a Separate Bank Account as a Freelancer?

Technically, no. However, it’s a good idea to separate your business and personal accounts using a separate business checking account. You may also want to look at business savings accounts. This makes it easier to track income and expenses. Additionally, depending on how you structure your business, you may be required to maintain a business banking account to show that your business is a separate entity apart from you.

How Do I Open a Bank Account as a Freelancer?

This is the easy part! Simply head to a physical location or the website of your chosen bank and let them know you want to open a business checking account (and possibly a business savings account). The bank will take care of the rest.

Penny Hoarder contributors Dave Schafer and Jamie Cattanach did the reporting and writing for this story.

Source: thepennyhoarder.com

November 20, 2021

SeedFi Lets You Get the Money You Need â Without a Payday Loan

If you’re like most of us, you know what it’s like to live paycheck to paycheck. You do your best to make the most of your money, but inevitably, the unexpected happens. Maybe your car breaks down, or you need an appliance repaired. Maybe you’re just a little short this month.

But you’ve got bills to pay. What are your options? For many people, it’s a payday loan with sky-high interest rates that just lock you into a cycle of debt.

Luckily there’s a better option to get the money you need — without taking a payday loan. A company called SeedFi offers loans with low interest rates and longer repayment terms that’ll keep your payments low and give you the time needed to catch up.

Even better — they can help you get ahead and build an emergency savings fund in the process, so you’re better prepared next time.

How to Get the Money You Need — Without a Payday Loan

If you’ve mulled the idea of a payday loan, it’s probably because you feel like you don’t have a lot of options getting your hands on money fast.

But if you’re looking to get the money you need now — and break the vicious payday loan cycle — SeedFi’s Borrow &Grow Plan¹ is a great option. SeedFi’s APR typically ranges from 14.99% to 29.99%, which is on par with prime loans you might not normally qualify for. Compare that to personal loans, which charge as much as 400% APR.

How This Loan Sets You up For Future Success

Not only will SeedFi get you the money you need as soon as possible — and for less — it will also set you up for success in the future.

Here’s how it works:

SeedFi offers a special type of loan. You’ll borrow the amount you need now, plus a little extra for later. They’ll safely lock away the extra money in a SeedFi savings account, and once you repay your loan, it’s yours to keep. When you repay your loan on time each month, your payments are reported to the major credit bureaus, so you could even build your credit in the process.

Borrowing $3,000 might look something like this: $3,000 goes into your checking account, and $1,500 is locked in a savings account until you repay the full loan. In this example, you’d pay $80 every two weeks over the course of 34 months, at 19.99% APR. Afterward, you’ll have a $1,500 emergency savings already built up.

SeedFi offers a long-term solution, with a healthy amount of money in your emergency savings account. Are you ready to break the cycle of debt and stop living paycheck to paycheck?

Answer a few quick questions here to see if you qualify for a Borrow & Grow Plan.

¹Borrow & Grow Plan loans for first-time borrowers range from $1,200 to $7,000 with $300 to $4,000 accessible immediately and the rest of the loan locked in a savings account until you repay in full. Repayment periods range from 8 months to 44 months, and APRs range from 6.95% to 29.99% Advertised rates and terms will be subject to change without notice. Your actual APR and other loan terms will be shown to you as part of the online application process.

² For a typical Borrow & Grow Plan, in which the consumer accesses $3,000 in cash now and places $1,500 in savings, the Amount Financed would $4,500, the APR would be 19.99%, the Finance Charge would be $1,417, the Total of Payments would be $5,917, the Payment Schedule would be 73 biweekly payments of $80 and one final payment of $77, and the Payment Schedule would span 34 months.

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Source: thepennyhoarder.com

November 19, 2021

New Tech is Coming! Hereâs Whatâs Worth Budgeting For

Apple’s recent announcement of the new iPhone 13 is one of several new tech items that have been announced or introduced recently. The Google Pixel 6 and the Samsung Galaxy S22 are two other phones that you might have your eye on. In addition to new phones, there are plenty of laptops, TVs, wearable items and other tech that are sure to make many Christmas shopping lists. If you or someone you love is a techie, here are some things to think about as you budget for new tech.

Most technology items are depreciating assets

The first thing to remember is that most technology items are depreciating assets. What that means is that it loses value over time. Like buying a new car, most tech items will never be worth more than it is at the time of its initial sale. Just like you might lose a third of your new car’s value as soon as you drive it off the car lot, your new phone might lose a third of its value as soon as you walk out of the Verizon or Apple store.

A new phone

Technological advances in cell phone technology have been nearly exponential since the original iPhone was introduced in June 2007. Every year, phone manufacturers seem to come up with additional features. Larger and more vibrant screens, bigger and more precise cameras and faster processors are just a sampling of the changes that are announced each year.

While there’s no doubt that a new cell phone today is significantly better than the original iPhone from 2007, those innovations come at a price. The new iPhone 13 comes with a suggested retail price of $699 to $1399, depending on the model. And that’s assuming you can actually buy an iPhone for its retail price, given the global chip shortages that are affecting supply chains.

Other new gadgets

Cell phones are not the only new gadgets that many people get interested in. New laptops, tablets, TVs and wearable technology are other things that have the highest value they’ll ever have when they first come out. If you want to be on the bleeding edge and always have the latest technology, you’ll definitely pay a premium.

Budgeting for new tech

So does the fact that most new tech gadgets are depreciating mean that you should never buy them? As with most personal finance decisions, the answer is that it depends on your specific situation. Remember that the whole point of a budget is to not spend money on things that are not important to you, so that you still have money to spend on the things that ARE important to you.

If new gadgets truly bring joy to your life, by all means, get every latest gadget the moment it comes out. Just make sure to include it in your budget so it doesn’t wreck the rest of your financial picture. A sinking fund can be a great way to do this, especially for items that are announced well in advance of the date they’ll be available for purchase. If you want to budget $1000 towards a new phone every year, set up your sinking fund to save $83 each month. Then when you’re ready for your new phone, you’ll have the $1000 that you need.

Alternatives to always buying the latest tech

If you’ve decided to hold off on buying the latest version of a particular gadget, here are a few alternatives. The easiest thing to do is take a look at the previous year’s model. Everyone that wants the one that just came out will be looking to sell their previous year’s version. That will drive down the resale price and you may be able to pick up a relative bargain.

Another alternative is to wait it out for a few months. Companies like Apple, Google and Samsung know there is a large market that wants the latest model of products. They also know that those people are willing to pay whatever it takes to get them as soon a possible. After a few months, it’s common for the price to drop anywhere from 25-50%

The Bottom Line

New technology and gadgets will continue to arrive every year at a remarkable pace. But just because a new version comes out doesn’t mean you have to be the first to buy it. Remember that most technology gadgets (including cell phones) are depreciating assets — they lose value over time. But if having the newest technology is important to you, make sure to plan for it in your budget. A sinking fund or other high-yield savings account is a good place to save up your money.

Learn more about security

Source: mint.intuit.com

November 18, 2021

Acorns Review: An App that Lets You Invest Without Thinking About It

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You’ve probably heard of Acorns. It’s a popular micro-investing app — even among people who don’t know a lot about investing — that helps you save money in a diversified portfolio.

By using one of its most popular features, you invest money without even really thinking about it. We love that convenience.

But investing is actually a serious endeavor. In this Acorns review, we’ll cover the app’s features, investing strategy and cost, along with other important details you should know before you get started.

What Is Acorns?

Acorns is a California-based fintech company that helps simplify and automate investing. Users can contribute money to a passively managed, diversified portfolio through recurring transfers and/or spare change round-ups.

Founded in 2014, Acorns has quickly become one of the most profitable and popular micro-investing apps in North America. The start-up has an estimated 8 million subscribers and was valued at roughly $2.2 billion in May 2021, according to CNBC.

The company has steadily expanded its financial services over time. The Acorns app now offers banking products (including a checking account), educational resources, a debit card, custodial accounts for kids and an automated retirement account service.

Acorns derives about 80% of its revenue from monthly user subscription fees. The other 20% comes from interchange fees and brand partnerships.

Acorns offers two membership options to subscribers. Both accounts charge a flat monthly fee:

Personal

$3 per month. You get access to an investment account, a retirement account and a checking account.

Family

$5 per month. In addition to all the Personal account features, the Family account grants access to custodial investment accounts for children.

Let’s dive into what these services include and other features in the Acorns app.

How Does Acorns Work?

Getting started with Acorns is easy. You open an account by visiting the Acorns website or mobile app, enter some personal information and then link your banking account to the app.

Acorns has a $0 account minimum balance, but requires at least $5 to start investing.

Acorns Services

Acorns markets its saving and investing features with five different names: Invest, Later, Spend, Early and Earn.

Most features are available with the $3 account, but Acorns Early is only available with the $5 Family account.

Acorns Invest (Taxable Brokerage Investment Account)

This is a taxable investment account that puts your money into a collection of exchange-traded funds (ETFs). Acorns creates your portfolio based on a questionnaire designed to gauge your risk tolerance and financial goals. You’ll answer these questions when you create your account.

You can add money to your Acorns investment portfolio via round-ups, recurring transfers from your bank or one-time deposits.

We’ll discuss more about how Acorns invests your money.

Acorns Later (Traditional IRA, Roth IRA, SEP IRA)

This is a tax-advantaged retirement account.

A retirement savings account is an investment portfolio, but it comes with some specific federal tax perks (and a few penalties, especially for early withdrawals).

The Acorns app lets you pick from either a traditional or Roth IRA. They also offer a SEP IRA option for self-employed people.

Saving for retirement is important. If your employer doesn’t offer a 401(k) plan, opening your own individual retirement account is a great way to start growing your nest egg.

The Acorns Later (IRA option) is a separate account from your Acorns Invest (taxable brokerage account). You get access to both with the $3 tier.

Like Acorns Invest, your IRA portfolio is made up of ETFs. You can also set up recurring transfers from your linked account to your Acorns retirement account.

Acorns Spend (Checking Account/Debit Card)

Acorns Spend lets you open a checking account through the app’s partnership with Lincoln Savings Bank.

You’ll also get access to a Visa debit card connected to your Acorns Spend account.

The Acorns checking account doesn’t charge overdraft fees. Instead it pauses your account until you add funds and get your balance out of the red. It also doesn’t charge foregin transaction fees if you use your Acorns debit card abroad. Plus your card can withdraw cash from more than 55,000 fee-free ATMs globally.

You can fund your Acorns checking account four ways:

Direct deposit
Recurring deposit
One-time deposit
Mobile check deposits

Acorns Early (UGMA Custodial Accounts)

Acorns Early lets you set up investment accounts for your children, also known as a UTMA/UGMA account.

You can open multiple UTMA/UGMA accounts with an Acorns Family plan — whether they’re for your child, a grandchild, a niece or even a godson.

To get started, you’ll need the child’s full name, date of birth and Social Security number. Like Acorns’ other offerings, you only need $5 to get started with Acorns Early, and your money funds an automated, diversified portfolio of exchange traded funds.

A UGMA account is a custodial brokerage account for children. You can transfer this investment account to your child when they become a legal adult.

Unlike a 529 plan that can only be used for educational expenses, a UTMA/UGMA is more flexible on how the money can be spent (you can use the funds for anything that benefits the child).

Once the child reaches the age of transfer, usually 18 or 21, they become the account’s owner and can use the money for any reason.

Make sure to research the different types of investment accounts for kids or speak with a financial advisor to find the best account for you.

Acorns Earn (Cash Back Feature)

Formerly known as Found Money, Acorns Earn is the app’s online marketplace with over 200 brands.

When you shop with these merchants, extra money will be added to your Acorns Invest account, usually as a percentage of your order total or a flat dollar amount. For example, you can earn 50 cents on each Uber ride but 3.5% back on Uber Eats orders.

For “Tap and Get” offers, you have to go through the Acorns app and complete a purchase with their partner using your mobile phone.

For “Simply Spend” offers, you’ll receive cash back any time you use your Acorns-linked card to make purchases with partner brands.

Make sure to read the instructions carefully on each offer or you’ll likely miss out on the cash back.

Aa a final note: While there are some good offers on Acorns Earn, many are incentivizing you to buy things you may not really need. Purchasing a fancy product or service just to get a few bucks invested in your Acorns account kind of defeats the purpose of saving for your future.

Acorns also has a few features common to all of its investment accounts.

Round-Ups

Round-up is probably Acorns’ best-known feature. After linking a debit card, your purchases are rounded up to the nearest dollar and the spare change is swept into your Acorns investment account.

For example, if you spend $10.20 on Amazon, you’ll be charged $11 and the 80 cent difference will be invested into your portfolio. This makes round-ups an easy way to invest when you spend money on everyday purchases.

If you have the Acorns Visa debit card, round-ups are automatically deposited into your account. If you don’t, Acorns transfers the money from your linked account to your investment account once it reaches at least $5.

Recurring Investments

You can set up automatic transfers from your linked banking account to your Acorns account on a daily, weekly or monthly basis.

Enabling recurring contributions is a great way to take advantage of dollar-cost averaging and consistently invest money for your future without thinking about it.

You can opt in for recurring transfers in addition to spare change round-ups to grow your account balance even faster.

Acorns also lets you make one-time lump-sum deposits.

Acorns Grow Your Knowledge

This is the hub for Acorns’ educational articles and advice on personal finance and investing.

Articles are broken into different categories, like retirement and borrowing, and they’re written in simple terms digestible in an app-friendly format.

For more educational resources, you can check out the grow.acorns.com site, powered by CNBC, which features articles on market trends and financial literacy topics.

How Acorns Manages Your Money

Acorns is a robo-advisor, meaning it uses computer software and algorithms to select a pre-made portfolio based on your age, income, risk tolerance and time horizon (how long before you may need to access your funds).

After answering a brief questionnaire, Acorns invests your money into a portfolio of exchange traded funds (ETFs), which bundle numerous stocks or bonds into a single fund. (FYI: ETFs are sometimes referred to as index funds.)

Acorns uses iShares and Vanguard ETFs, which come with very low expense ratios. An expense ratio is the operating fee charged by an ETF.

Acorns offers five different portfolios, ranging from conservative to aggressive. The aggressive option consists of stock ETFs while conservative options expose you to more bond ETFs.

You can choose a different portfolio if you disagree with the algorithm, but you can’t pick your own individual stocks or bonds with an Acorns account.

Acorns uses modern portfolio theory, an investment strategy that works by diversifying you across different asset classes to help lower risk and maximize returns.

ETFs span six different asset classes:

Corporate bonds
Government bonds
Domestic large company stocks
International large company stocks
Small company stocks
Medium company stocks

Because ETFs can cost hundreds of dollars per share, Acorns builds your portfolio with fractional shares. That’s how you can get started with as little as $5.

Once you start investing, your portfolio will be periodically rebalanced to maintain its target asset allocation. You also get the benefit of automatic dividend reinvestments.

Acorns Sustainable Investing Portfolio

Acorns gives users the option to save and invest in a sustainable portfolio made up of ETFs graded using environmental, social and governance (ESG) criteria.

Acorns says these socially responsible investing portfolios are designed to provide exposure to more sustainable companies, while still striving to perform as well as a traditional portfolio.

You can opt into Acorns’ sustainable portfolio for no additional monthly cost. However, the ETFs in this ESG portfolio come with slightly higher expense ratios.

Acorns Cost and Fees

Acorns charges a flat monthly management fee for its services. It advertises two different membership tiers: a $3 option and a $5 option.

Prior to Sept. 21, 2021, Acorns offered a third membership option for $1 per month. Acorns Lite gave you access to its automated portfolio and investment services. If you wanted an IRA or checking account, you had to upgrade to the $3 option.

Acorns recently phased out Acorns Lite. Existing customers can (potentially) still keep the $1 option, now called Acorns Assist, by following these steps on the company’s website.

Acorns Account Pricing

Membership	Price per month
Acorns Assist (for existing customers facing economic hardship)	$1
Acorns Personal	$3
Acorns Family	$5

We suggest locking in that $1 Acorns Assist price if you can. Otherwise, spending $36 a year for a brokerage account is pretty expensive, especially if your account balance is low.

Other robo-advisors, such as Wealthfront and Betterment, charge a management fee as a percentage of your portfolio balance instead of a flat monthly fee. That may not sound like a big deal, but imagine this.

Let’s say you funded a new investment account with $100. Betterment charges an annual management fee of 0.25% for its basic account, which would cost you just $0.25 a year. Compare that with investing $100 in the Acorns Personal account, where the annual fee would total $36.

Obviously, Acorns’ management fees take up a smaller proportion of your balance as you invest more money. Still, you’d need about $13,000 in an Acorns Personal account to get down to an annual fee of 0.25%.

However, if you’re more comfortable with Acorns or want to give it a try, at the end of the day, we’re just happy you’re investing. It’s a good first step, just mind those management fees over time.

What Acorns Offers

Here’s a closer look at the nuts and bolts of Acorns accounts.

Acorns Review: Services and Features

Feature	Details
Account minimum	$0 to open, $5 to invest
Account management fees	Personal, $3; Family, $5
Portfolio mix	Stock & bond ETFs
Socially responsible portfolio options	Higher expense ratios
Tax strategy	No tax loss harvesting
Automatic rebalancing	Free for all accounts
Human advisor option	None
Bank account/cash management account	Checking w/ no overdraft
Customer support	Email [email protected]

Pros and Cons of Acorns

Acorns offers several advantages, but it’s not for everyone. It’s important to understand the pros and cons of any investing app before you sign up.

Pros

Easy-to-navigate interface you can access on your computer or mobile device.
Diversified portfolios with risk-appropriate, low-cost investment options.
Round-ups to the nearest dollar and recurring transfers from a linked credit or debit card make investing easy and effortless.
You get the option to bank, invest and save money for retirement in a single app.
There’s no account minimum and you can start investing with $5.

Cons

Acorns’ management fees are relatively high for accounts with low balances.
No tax loss harvesting feature.
No access to human financial advisors.
You can’t tweak individual investments inside your portfolio. (Nope, you can’t buy individual shares of Tesla or Apple with Acorns).

Frequently Asked Questions

Can You Make Money With Acorns?

Yes, that’s the whole idea! You’ll make money as your investments gain value over time. You can also earn bonus investments, known as Found Money, by participating in offers from the company’s business partners. Finally, Acorns also offers referral bonuses to users who get their friends and family to sign up for the app.

Is It Safe to Invest With Acorns?

Yes, Acorns is a safe and secure financial services app. Just like other brokerage accounts, Acorns complies with federal law and is registered with the U.S. Securities and Exchange Commision. Its checking account is also FDIC insured, giving you the same protection as a traditional bank.

What Are the Cons of Acorns?

Probably the biggest drawback of Acorns is that its $3 or $5 per month account options are relatively pricey for people with low account balances. Acorns phased out its $1 Acorns Lite option for new users in September 2021.

Rachel Christian is a senior writer for The Penny Hoarder.

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Source: thepennyhoarder.com

November 18, 2021

7 Things Medicare Doesnât Cover

Healthy Living on a Budget

Medicare Part A and Part B leave some pretty significant gaps in your health-care coverage. Here’s a closer look at what isn’t covered by Medicare.

November 16, 2021

Medicare Part A and Part B, also known as Original Medicare or Traditional Medicare, cover a large portion of your medical expenses after you turn age 65. Part A (hospital insurance) helps pay for inpatient hospital stays, stays in skilled nursing facilities, surgery, hospice care and even some home health care. Part B (medical insurance) helps pay for doctors’ visits, outpatient care, some preventive services, and some medical equipment and supplies. Most folks can start signing up for Medicare three months before the month they turn 65.

It’s important to understand that Medicare Part A and Part B leave some pretty significant gaps in your health-care coverage. Here’s a closer look at what isn’t covered by Medicare, plus information about supplemental insurance policies and strategies that can help cover the additional costs, so you don’t end up with unexpected medical bills in retirement.

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Medicare Doesn’t Cover Prescription Drugs

Medicare doesn’t provide coverage for outpatient prescription drugs, but you can buy a separate Part D prescription drug policy that does, or a Medicare Advantage plan that covers both medical and drug costs. (Some retiree health-care policies cover prescription drugs, too.) You can sign up for Part D or Medicare Advantage coverage when you enroll in Medicare or when you lose other drug coverage. And you can change policies during open enrollment season each fall. Compare costs and coverage for your specific medications under either a Part D or Medicare Advantage plan by using the Medicare Plan Finder.

2 of 8

Medicare Doesn’t Cover Long-Term Care

One of the largest potential expenses in retirement is the cost of long-term care. The median cost of a private room in a nursing home was roughly $105,800 in 2020, according to the Genworth Cost of Care Study; a room in an assisted-living facility cost $51,600, and 44 hours per week of care from a home health aide cost $54,900.

Medicare provides coverage for some skilled nursing services but not for custodial care, such as help with bathing, dressing and other activities of daily living. But you can buy long-term-care insurance or a combination long-term-care and life insurance policy to cover these costs.

3 of 8

Medicare Doesn’t Cover Deductibles and Co-Pays

Medicare Part A covers hospital stays, and Part B covers doctors’ services and outpatient care. But you’re responsible for deductibles and co-payments. In 2022, you’ll have to pay a Part A deductible of $1,556 before coverage kicks in, and you’ll also have to pay a portion of the cost of long hospital stays — $389 per day for days 61-90 in the hospital and $778 per day after that. Be aware: Over your lifetime, Medicare will only help pay for a total of 60 days beyond the 90-day limit, called “lifetime reserve days,” and thereafter you’ll pay the full hospital cost.

Part B typically covers 80% of doctors’ services, lab tests and x-rays, but you’ll have to pay 20% of the costs after a $233 deductible in 2022. A medigap (Medicare supplement) policy or Medicare Advantage plan can fill in the gaps if you don’t have the supplemental coverage from a retiree health insurance policy. Medigap policies are sold by private insurers and come in 10 standardized versions that pick up where Medicare leaves off. If you buy a medigap policy within six months of signing up for Medicare Part B, then insurers can’t reject you or charge more because of preexisting conditions. See Choosing a Medigap Policy at Medicare.gov for more information. Medicare Advantage plans provide both medical and drug coverage through a private insurer, and they may also provide additional coverage, such as vision and dental care. You can switch Medicare Advantage plans every year during open enrollment season.

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Medicare Doesn’t Cover Most Dental Care

Medicare doesn’t provide coverage for routine dental visits, teeth cleanings, fillings, dentures or most tooth extractions. Some Medicare Advantage plans cover basic cleanings and X-rays, but they generally have an annual coverage cap of about $1,500. You could also get coverage from a separate dental insurance policy or a dental discount plan. An alternative is to build up money in a health savings account before you enroll in Medicare; you can use the money tax-free for medical, dental and other out-of-pocket costs at any age (you can’t make new contributions to an HSA after you sign up for Medicare).

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Medicare Doesn’t Cover Routine Vision Care

Medicare generally doesn’t cover routine eye exams or glasses (exceptions include an annual eye exam if you have diabetes or eyeglasses after having certain kinds of cataract surgery). But some Medicare Advantage plans provide vision coverage, or you may be able to buy a separate supplemental policy that provides vision care alone or includes both dental and vision care. If you set aside money in a health savings account before you enroll in Medicare, you can use the money tax-free at any age for glasses, contact lenses, prescription sunglasses and other out-of-pocket costs for vision care.

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Medicare Doesn’t Cover Hearing Aids

Medicare doesn’t cover routine hearing exams or hearing aids, which can cost as much as $3,250 per ear. But some Medicare Advantage plans cover hearing aids and fitting exams, and some discount programs provide lower-cost hearing aids. If you save money in an HSA before you enroll in Medicare, you can also use that tax-free for hearing aids and other out-of-pocket expenses.

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Medicare Doesn’t Cover Medical Care Overseas

Medicare usually doesn’t cover care you receive while traveling outside of the U.S., except for very limited circumstances (such as on a cruise ship within six hours of a U.S. port). But some medigap plans will cover 80% of the cost of emergency care abroad up to a certain limit. Additionally, some Medicare Advantage plans cover emergency care abroad. Or you could buy a travel insurance policy that covers some medical expenses while you’re outside of the U.S. and may even cover emergency medical evacuation, which can otherwise cost tens of thousands of dollars to transport you aboard a medical plane or helicopter.

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How to Look Up What Is and Isn’t Covered by Medicare

To look up Medicare’s coverage rules and other types of care and procedures, go to Medicare.gov/coverage and use the “Is my test, item or service covered?” tool. Also see What Original Medicare Covers. If you believe a claim was unfairly denied, see How to Appeal a Denied Medicare Claim.

Source: kiplinger.com

November 17, 2021

Affordable Child Care Hacks

With many parents living in households where both spouses work outside the home, child care has become a significant portion of many budgets. While nobody wants to leave their children in the care of the absolute lowest paying provider, many people are looking for ways to save money on child care expenses. Here are a few hacks to consider if you’re looking for ways to save money on childcare.

Use Dependent Care FSA

One of the best child care hacks is a dependent care flexible spending account (FSA). A dependent care FSA is similar to a Health Savings Account. Both are accounts that are typically offered as employee benefits. A Dependent Care FSA allows you to take out money from each paycheck and not have to pay taxes on it.

You can then use that money to pay for child care throughout the year. A wide variety of different types of childcare are eligible to be paid for with DCFSA funds, so make sure to check the rules and regulations of your account. By paying for your childcare costs with pre-tax dollars, you’re getting a savings of 20-30% or more as compared to paying with after-tax money.

One other thing that you’ll want to be aware of with a Dependent Care FSA is that many accounts are “use it or lose it” each year. So you’ll want to be conservative with how much money that you put into the account, and make sure that you use all of your funds each calendar year.

Work From Home Or Adjust Your Schedule

Another possible child care hack involves how flexible you can make your schedule. Of course this will depend on your specific employer and job situation, but if you have flexibility with your schedule, it’s possible that you can arrange things to save on childcare. This is especially true if your spouse or partner also has a flexible schedule.

It’s unlikely that you’ll be able to adjust your schedule so that you can both work full-time at home and take care of children full-time, especially if your children are younger. Clearly, that will mean that both your work and home life are likely to suffer. But you may be able to arrange things so that you can trade off with your spouse to reduce the amount of days / hours that you need childcare.

One idea might be to trade off days where you are working from home vs. being in the office. Or, if you have flexibility with your workable hours, you might work early in the morning with your spouse doing child care in the mornings to trade off later in the day. Experiment with different options to see if any of these options work well for your family. Even one day a week where you can save on childcare represents a 20% savings.

Consider a Nanny Share

If you’re more interested in working with a nanny but feel like it’s too expensive a nanny share could be a great option for your family. Sharing a nanny with neighbors or friends can be a good way to take advantage of the benefits of having a nanny including a more flexible schedule and more one-on-one attention for your child while also cutting cost.

Look For Family And Friends

Another option is to look for family and friends that might be able to help out. If grandparents live in the area, they could be an option, either as full-time caregivers or as part of your overall childcare strategy. Again, this is something where being able to be a little flexible can help out. Another option to look into might be doing a bartering arrangement with another family where you exchange childcare for another service.

Is It Worth It?

Finally, take a look at your budget and see if going to a one-income household is at all feasible for your unique situation. Of course, in many situations it will not be, but there are hidden expenses to the two-income life that you might not be thinking about. If you are in a household situation where one partner makes significantly more than the other, it may make sense to have the second partner stay at home.

Of course, you’ll almost completely eliminate your childcare expenses if one partner stays at home, but with someone at home full-time, you may also drastically reduce your food budget. Having someone at home likely means that you’ll be able to shop more carefully and eat out less.

Taxes are another big expense that you can reduce by dropping to one income. With a second income, not only are you paying taxes on your income, but by raising the total household income, you’re likely being bumped up to a higher tax bracket overall. It may not be possible, but if there is interest in having one spouse stay at home, run the numbers and see if it makes sense for you.

The Bottom Line

For families, childcare is one of the largest expenses of your household budget. But if you’re flexible and think outside of the box a bit, you can save some of those costs. If your employer offers it, look at a Dependent Care Flexible Spending Account to pay some of your child care expenses with pre-tax dollars. And if you have a job where you work from home sometimes, see if you can arrange your schedule to help cut down on childcare costs.

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Source: mint.intuit.com