In the US, no one really talks about their money. It’s taboo—impolite, embarrassing, rude. No one wants to sit at the dinner table comparing salaries and tax brackets.
But when the time comes to buy a house, money talk is a necessary evil. Such conversations are critical to getting on the same page financially as your partner. In fact, financial disparities between partners is a leading cause of divorce when not handled properly.
Fortunately, we have some tips about having this delicate conversation on money with your partner, and coming out of it with a better idea of what you two can afford in the housing market.
Planning Before the Conversation.
Before anything, it is important to plan your conversation ahead of time. Write down questions and responses you would like to have ready when you have the talk with your partner. If you don’t already know what their yearly earnings are, it is time to find out.
Additionally, it may be helpful to brainstorm some financial management strategies to cut down on existing costs. Do you really need that magazine subscription or the deluxe package of cable channels? If you are coming into this conversation from a position of power (i.e. you earn more than your partner) take time to carefully word your conversation to avoid gridlock and tension. Some good opening lines include:
“We might benefit from meeting a financial coach together.”
“We should spend the night going over our budget together. Would you help me get a sense of our spending for each month?”
Where do you think we should start our housing search in terms of pricing? What is financial stable for you?
Where to Start.
The first step of the money talk is perhaps the most difficult step. It is important that you and your partner talk about relationship goals. You don’t necessarily have to ask the clichéd question, “Where do you see yourself in 5 years?” but you should have a good forecast of where you will be in a year or two.
Further, where do you see this relationship going? Sometimes, a house is more than a purchase, but the next step in a relationship. If marriage or kids are on the horizon, that will certainly effect the size and location of your real estate search.
Next up, it is important to assess your current financial situation. Where are you both in terms of income and expenses, assets, debts, and credit ratings? Will your financial profile be strong enough to earn a favorable mortgage interest rate? Or will you have to plan to take on a little more debt? Alongside this conversation, it would be a good idea to think about ways to reduce any debts you have faster. This is where you and your partner should be getting into the nitty-gritty of financial transparency. Talk about retirement savings and compare credit scores; factor in family planning costs if that’s where your relationship is heading.
Once you have sussed out where you are presently in terms of money, it is time to look toward the future and discuss potential changes to how, where, and why you spend money. Budgeting together is the best way to start this conversation, identifying where each other can stand to shave off a few dimes.
Communication is key, especially if the money being put toward a home will come more from one partner than the other. That extra financial burden should be recognized and discussed. It is also time to compromise. Commonly, partners will have to find ways to balance the splurging problems of one partner with the intense frugality of the other.
Where to End Up.
Your conversation on financial planning should really culminate in a place of mutual understanding. You and your partner have a future ahead of you that requires, by necessity, time and money. Even if your financial situation changes in the next month or year, getting on the same financial page as your partner will give you a road map to fiscal solvency, and the ability to plan for your future years together.
With that knowledge in mind, you can come into the real estate market from a position of power, brokering deals that will suit you and your partner and provide a strong head start to a future together.
Inside: Looking for information on what a typical Christmas bonus in the US is? This guide will help you calculate how much you can expect and what to do with it.
Are you waiting eagerly for that year-end surprise called the Christmas bonus? Like Clark in National Lampoon’s Christmas Vacation?
Or maybe you’re an employer wondering about giving out festive bonuses?
This guide is a jingle bell away with everything you need to know about Christmas bonuses in the United States.
You’ll discover how these additional pays work, what the typical bonus amounts are, tax implications, the benefits of giving a bonus, and wisely spending your bonus. In other words, it decodes everything from the employer’s perspective, right to how it impacts an employee’s pocket and spending decisions.
So, buckle up – you’re about to become a little richer in knowledge. Stay tuned!
What is a typical Christmas bonus?
A Christmas bonus, often referred to as a “13-month-salary,” is a special gift you might receive from your employer at the end of the year.
It depends largely on your company’s resources and financial standing, meaning not everyone will get one.
However, if you’re lucky, you might expect a bonus ranging from 2% to 5% of that, discretionary to your employer.
Thus, the average Christmas bonus would be you could be looking at an additional payout of around $1144-2860, assuming an average income of $57,200.
Does everybody get a Christmas bonus?
Not all employees in the US typically receive a Christmas bonus.
The giving of bonuses varies between companies and roles within those companies.
Personally, I have only had one company that gave out Christmas bonuses. Most companies tend to give their annual year-end bonuses, which may be based on factors like performance or tenure, during the first quarter of the new year.
While a Christmas bonus would be nice as it often serves as an appreciation gesture for hard work throughout the year.
Understanding the concept of Christmas Bonus
A Christmas Bonus is essentially a little financial gift from your employer during the holiday season. Think of it as an extra dollop of icing on your annual salary cake.
It’s typically a percentage of your salary and serves to show appreciation for your hard work throughout the year.
For instance:
Let’s say you earn $80000 a year and your boss awards a Christmas bonus of 5% would then receive an extra $4000 just in time for the festivities.
Your company elects to give all employees a flat $1000 Christmas bonus regardless of seniority.
Note that a Christmas bonus isn’t legally required and varies greatly between businesses.
History of Christmas Bonuses
Woolworth’s birthed this tradition back in 1899, offering a cash bonus of $5 for each year of service with a limit of $25.
In Woolworth’s early years, they established a pattern of rewarding their employees with a generous Christmas bonus.
This practice was seen as an annual tradition and was appreciated by their staff, instilling a sense of loyalty within the workforce.
Over time, Christmas bonuses have evolved not just in amount but in form as well. Besides cash, you could also receive gifts or even lavish holiday parties.
Despite the more modern trend of diminishing Christmas bonuses, this part of Woolworth’s history highlights the positive potential of such incentives.
Factors influencing the amount of Christmas Bonus
Considering factors on the Christmas bonus is crucial because it ensures fair distribution, tailored to individual employees’ performance, length of service, or their specific needs.
We all know that bonuses adequately demonstrate appreciation and recognize the hard work of their employees, increasing their job satisfaction and driving productivity.
So, let’s look into whether or not a Christmas bonus is viable for you or your company.
1. Company policy on Christmas Bonus
A company’s policy about Christmas bonuses is typically laid out in the employee handbook and company policies.
Policies may stipulate that Christmas bonuses are issued under certain circumstances, like when the employee has met specified targets or when the company has performed exceptionally well during the year.
Also, the board of directors may elect to give out one-time Christmas bonuses.
However, if these bonuses are not incorporated into the employee’s employment contract, they are typically subject to the employer’s discretion. Employers must take extra caution to ensure that these bonuses are presented as discretionary and not part of a contractual agreement.
Remember, these factors may vary from one company to another. Always refer to your employer’s specific policies and handbooks for accurate information.
2. Amount of Salary
Your annual gross income might influence the amount of your Christmas bonus, as some employers factor in their employees’ base pay when determining bonus amounts.
However, not all organizations adopt this practice, with some opting for a fixed, equal distribution amongst all staff members regardless of their earnings.
Therefore, depending on your contractual agreement and your employer’s policies, your salary could influence your bonus, but this isn’t a universal rule.
3. Type of Bonus
The types of bonuses vary greatly as companies have the discretion to decide the nature of the bonus, with the decision often driven by the organization’s performance, the individual’s job role, and the overall economic conditions.
They can be incentive-based, linked to performance targets, holiday-exclusive like Christmas bonuses, or tagged to specific business milestones, leading to significant variability.
Here are different types of bonuses you should know about:
Discretionary bonuses: These are given at your employer’s will. They might consider factors like company performance or your personal performance reviews. However, there’s no guarantee you’ll receive one.
Non-discretionary bonuses: These are part of your employment contract. As long as you meet certain criteria, you’ll receive this bonus on top of your salary during the Christmas season.
Non-holiday bonuses: Given outside of the holiday season, these can be extra pay or an item like a company car.
Remember, your bonus type dictates how much you could get for Christmas. Be sure to check your contract!
4. Company Culture
Company culture significantly affects bonuses as it underpins how employees perceive their value and recognition within the organization.
If the culture fosters transparency, fairness, and goal-oriented behaviors, bonuses can effectively serve as an incentive and boost morale. Statistics show that employee loyalty increases when they feel appreciated, which can often be demonstrated through financial bonuses.
Moreover, a culture encouraging open communication assures employees of fair dealing when it comes to awarding bonuses.
Hence, bonuses, when tied to clear goals, become more than just monetary rewards, ensuring employees understand their role in the company’s success.
5. Recipients of the Bonus
In the US, Christmas bonuses are usually gifted to all employees, irrespective of their role or position.
Some of the roles that may receive a Christmas bonus include:
Full-time employees: Usually part of the main workforce, these individuals are often at the receiving end of holiday bonuses.
Part-time employees: Even though they may work fewer hours, many companies consider them for bonuses.
Temporary workers: Though their roles are for a limited time, they are generally excluded as part of the company’s bonus scheme.
Contracted employees: If their contract includes a clause for a holiday bonus, they are quite likely to receive a Christmas bonus. If it does not, they will not receive one.
Remember, the goal is inclusivity, a policy aimed at making every employee feel rewarded and appreciated during the festive season.
6. Holiday Season
Christmas bonuses are commonly offered by employers during the holiday season in the United States. This bonus is seen as a way to show appreciation and respect to employees, which can help to mitigate feelings of burnout.
Companies may elect to give bonuses at other times of the year to motivate their employees and boost their job performance. These bonuses can incentivize individuals to achieve specific company goals, with the promise of additional monetary compensation driving their hard work.
Aside from motivation, off-season bonuses also serve as a token of appreciation, illustrating a company’s recognition and value of their employees’ efforts.
It’s worth noting that a bonus doesn’t necessarily have to be monetary. Examples can also include extra vacation days or other perks.
7. Amount Given to Employees
A Christmas bonus is an extra payment given to employees during the holiday season as a gesture of gratitude for their commitment and hard work.
Factors influencing the Christmas bonus amount include:
Length of service: Employees who’ve been with the company longer might receive a higher bonus. For instance, an employee with a decade of service might receive $1,000 at a rate of $100 per annum.
Based on Salary: Many companies may opt to give a flat percentage related to the salary of their employees.
Flat Amount: Others may give the same amount to all employees across the company.
8. Company’s Financial Resources & Performance
A stronger performing company is more likely to give more bonuses as it typically correlates with higher profits, enabling them to be more generous with employee rewards.
On a company level, if overall performance benchmarks are hit, Christmas bonuses may increase across the board.
In fact, the incentive of bonuses can create a highly driven workforce that pushes towards achieving and even exceeding business goals. Furthermore, companies that distribute bonuses, particularly holiday bonuses, can significantly boost employee morale, fostering both loyalty and a positive company culture.
How to Calculate Your Potential Christmas Bonus
Calculating your Christmas bonus can often seem nebulous, leaving many uncertain about the amount they should expect.
The elusive nature of the Christmas bonus can largely be attributed to the fact that unlike salary, it isn’t typically fixed and may vary based on several factors such as an employee’s performance, the length of their service, or the financial health of the organization.
Despite this, there are a few pointers that can shed light on how to calculate this anticipated festive season reward.
Step 1: Check if you are Eligible for a Christmas bonus
Figuring out your potential Christmas bonus firstly entails a careful examination of the terms of your employment contract, alongside other supporting documentation such as your employee handbook or job offer letters.
These documents accurately establish the contractual relationship between you and your employer and often contain crucial clues about bonus calculations.
For instance, if your contract states that you are entitled to an equivalent of one week’s salary as a Christmas bonus, then you can confidently expect that amount.
Keep in mind the discretion of the employer in case of confusion. Some bonuses might not be contractual but discretionary. Consult your HR department for clarification if needed.
Step 2: Calculate your percentage of the total bonus amount
To calculate your bonus based on your salary, you need to know the exact percentage your employer uses, which usually ranges from 2-5% of your annual earnings.
Multiply your annual salary by the bonus percentage to determine your possible holiday bonus.
For instance, if you earn a yearly salary of $100,000 and your employer gives a 2% bonus, you’ll receive a $2,000 bonus.
Step 3: Is my Christmas Bonus Taxable?
So, if you’re anticipating a hefty holiday bonus, remember, it might be subject to taxes.
Bonuses are often considered supplemental income.
As such, the Internal Revenue Service (IRS) requires a 22% federal income tax on this income, which can reduce your bonus significantly.
State laws also have a part to play. Your holiday bonus is taxed according to your state tax rate, which is another cut from your bonus.
For example, your bonus amount is $5000 after federal taxes of $1100 and state 4% taxes of $200 are deducted, your take-home bonus is $3700.
How to Spend Your Holiday Bonus
The anticipation of receiving that extra lump sum has many employees daydreaming about that eye-catching new car, an extravagantly relaxing vacation, or perhaps the latest tech gadget.
Although it’s tempting to indulge in the pleasure of immediate gratification, there are more finance-savvy alternatives to consider for the effective utilization of your annual bonus.
1. Invest your Christmas Bonus
Getting that skip in your heartbeat when you receive your Christmas bonus is a feeling like no other.
However, the real magic happens when you decide to invest this bonus, making it grow over time instead of spending it all at once.
Here are the top four ways to invest your Christmas bonus:
Wealth Creation: When you invest your bonus, you’re setting yourself up for future wealth. Learn how to invest 10k.
Earn Additional Income: Use your bonus as a kick-start to a side hustle. Many Americans already secure supplemental income this way. In fact, many people are interested in how to make money online for beginners.
Professional Growth: Investing your bonus into professional development is another smart move. Enrolling in online courses that build your technical skills or lead to certifications can enhance your earning potential. Learn to invest 100 to make 1000 a day.
Financial Security: Finally, investing your bonus helps to secure your financial future. Whether it’s putting money into retirement funds or investing in a high-yield savings account, every bit helps set you up for stability and freedom. This sets you up to become financially independent.
Your Christmas bonus could be the first step towards a future of financial growth and security.
2. Consider your financial needs for the coming year
Before you rush to spend your holiday bonus, consider your financial needs for the coming year.
Start by:
Assessing your monthly expenses. How much do you need for essentials like housing, utilities, and food? Compare with the ideal household budget percentages.
Evaluating your emergency fund. Remember, experts recommend at least $1000 in an emergency fund. Plus having three to six months’ worth of expenses stored away in a rainy day fund.
Big expenses coming your way: Do you have any costly expenses like home repairs or car replacement in your future?
You may want to set aside money for those future needs, so you will be financially stable when they happen.
3. Pay Off Bills
Don’t run to the stores before analyzing your debt.
If you have high-interest loans or credit card debt, prioritize paying these down. Our expert tip at Money Bliss is to tackle the highest interest debt first.
Use your bonus to pay off debts: Since a bonus is usually an unexpected sum of money not factored into your annual budget or salary, you can make significant headway in paying off your debts, particularly those with high-interest rates.
Save on interest charges by reducing debt: The bonus can help reduce your debt balance, leading to less interest accruing over time. This move could save you hundreds, even thousands, over the long term.
Consider debt management apps: Apps like UndebtIt help you find a debt free date. Platforms like Tally† can simplify your debt payoff journey with automated payments using a lower-interest line of credit.
Reconsider splurging your holiday bonus: Rather than spending it all on that coveted item or trip, you might want to consider other financially beneficial options.
4. Buy Christmas Gifts
Utilizing your holiday bonus wisely to purchase Christmas gifts can be a smart and rewarding way to use your end-of-year windfall.
Instead of splurging on high-cost items, consider thinking through your holiday gift list and budgeting accordingly.
Bear in mind that enjoying the holiday season doesn’t have to break the bank; as Christmas on a budget is possible.
Don’t forget to spoil yourself with a gift every now and then. You’ve worked hard for this bonus and deserve a treat too.
5. Splurge on Fun Things
It’s absolutely okay to treat yourself with a holiday bonus – after all, you’ve earned it! Using it wisely can add a dash of fun and pure enjoyment to your life.
Now, what do I want for Christmas?
Here are a few fun ways to splurge your holiday bonus:
Dream vacation: The bonus could be your ticket to the vacation you’ve been fantasizing about. Plan carefully to make the most out of it.
Invest in hobby: Whether it’s photography, painting, or gardening, investing in a hobby can prove to be quite rewarding.
Spoil yourself: Get that TV you’ve been eyeing or make a down payment for that new car you fancy.
Remember, pleasure is a great aspect of well-being. So, it’s great to treat yourself once in a while. Just balance it with other financial responsibilities.
6. Invest in Long-Term Goals
Ditch the instant gratification of spending your holiday bonus all at once. Instead, consider investing it towards long-term goals for an even greater payoff.
Here are some easy steps to set you on the right path:
Identify your long-term financial goals. Be it a dream home, kids’ education, or retirement, a clear goal will help you stay motivated.
Assess your current financial situation to gauge how much of the bonus you can invest.
Choose the right investment vehicle. Stocks, bonds, or real estate can be profitable, depending on your risk appetite and time horizon.
Remember, spending wisely today makes for a secure tomorrow.
7. Give Back to the Community
Giving back to your community during the holiday season is a fantastic way to share your fortunes. Not only does it bring joy to those in need, it fosters appreciation, empathy, and understanding.
Here are some thoughtful ways to use your holiday bonus:
Donate to a Local Charity: Identify a local charity that resonates with your values. Every donation counts and your contribution could make a substantial impact.
Sponsor a Family’s Holiday: Many organizations connect sponsors with families in need. Your bonus could help provide them with essential groceries, clothes, toys, and a memorable holiday experience.
Contribute to a Fundraiser: Participate in your community or workplace fundraisers. Your financial support could contribute towards a noble cause, be it medical aid, education, or relief work.
Volunteer Your Time and Skills: Although not a direct use of your bonus, volunteering can be another way to give back. Maybe your bonus might allow you some additional free time to offer.
Remember, volunteering often reflects individual happiness and improves overall well-being.
Do You Expect the Average Christmas Bonus?
Remember, Christmas bonuses can be diversified: from additional checks or sums of money to extra vacation days or tangible gifts.
Everyone always wants a Christmas bonus! So now, you can determine if yours is above or below the average Christmas Bonus!
Based on research, less than a quarter of employers offer a performance-based holiday bonus, so if you’re fortunate enough to receive one, consider investing it to reap greater returns in the future.
The best decision depends on your unique financial situation, so use the above tips to make a smart choice with your bonus money.
Know someone else that needs this, too? Then, please share!!
The Debt Ceiling Bill signed into law in June 2023 finally brought an end to the federal student loan payment pause, with payments resuming on October 1, 2023 (and interest accrual resuming a month earlier). The result is that millions of federal student loan borrowers — at least, those not taking advantage of the student loan “on-ramp” — will need to begin making minimum payments again as of October 1. However, some borrowers may opt to make more than the student loan minimum payment so that they can expedite the repayment process on their loan.
What Is the Minimum Payment on Student Loans?
The minimum payment on student loans is the lowest amount of money a borrower can pay each month. The actual student loan minimum payment amount owed each month might be determined by factors including the loan type, interest rate, and the repayment plan. Generally, the minimum monthly payment includes the principal (the original amount borrowed), interest, and fees.
For federal student loans, the minimum monthly payment depends on the repayment plan a borrower is on, as follows:
Standard Repayment Plan: On this plan, your payments are a fixed minimum amount of at least $50 a month, and your loans are paid off within 10 years.
Saving on a Valuable Education (SAVE) Plan: With SAVE, a new income-driven repayment (IDR) plan introduced by President Biden in late June 2023, borrowers with undergraduate federal student loans will get the lowest monthly payments of any IDR plan. For those who are single and make $32,800 a year or less and for families of four who make $67,000 or less annually, the minimum monthly payment is $0 (meaning they owe no loan payment). Those who earn more than those amounts will save at least $1,000 a year on the SAVE plan compared to current IDR plans.
Pay As You Earn (PAYE) Plan: Under the PAYE plan, borrowers’ payments are 10% of their discretionary income and are also based on their family size. With PAYE, their payment could be as low as $0 per month, and they won’t owe more monthly than they would have on the Standard Repayment Plan.
Income-Based Repayment Plan: Borrowers on this plan need to have a high debt-to-income ratio in order to be eligible. Their monthly payments will be 10% to 15% of their discretionary income, and could be as low as $0. Borrowers won’t owe more monthly than they would have paid on the Standard Plan.
Income-Contingent Repayment Plan: Borrowers with Direct loans who are eligible for this plan will have monthly payments that are the lesser of 20 percent of their discretionary income or the amount they would pay on a fixed repayment plan over 12 years, adjusted for their income. Their payments may be as low as $0 a month.
Graduated Repayment Plan: With this plan, a borrower’s monthly payments are lower at first and then increase, usually every two years. The monthly amounts they will pay will be enough to repay their loans within 10 years.
Extended Repayment Plan: For those on the Extended plan, their payments may be fixed or graduated, and the amount they pay each month will be enough to ensure their loans are paid off in 25 years. Their payments will be lower on this plan than they would be on the Standard or Graduated plans.
You can use the Federal Student Aid’s Loan Simulator to help calculate how much you’ll owe and find the best repayment plan option for your situation.
Can I Pay More Than The Minimum on Student Loans?
It’s possible to make more than the minimum payment on student loans without being charged for any prepayment penalty fees. Both federal student loans and private student loans are required to allow borrowers to make extra payments and pay off their loan early without charging any additional fees.
Making extra payments can help decrease the interest paid and help reduce the overall cost of the loan. Typically, you can contact your lender to specify that the extra payment be applied to your highest interest loan and be applied to the principal value of the loan.
Making payments directly to the principal value of the loan can help speed up repayment. And, because most student loan interest is charged per day, making additional payments on the principal value of the loan can help reduce the amount you pay in interest over the life of the loan. 💡 Quick Tip: Refinancing student loans is a way to lower your monthly payments by either getting a lower interest rate and/or extending the loan term. Please note: If you refinance a federal loan, you will no longer have access to federal protections and benefits.
Why Would You Pay off Your Student Debt Sooner?
As with any debt, a primary motive for paying off student debt early is to more quickly remove debt that’s racking up interest. Prioritizing debt repayment could help lower your debt to income ratio and could help you reduce the amount of money you owe in interest over the life of the loan. Here are a few reasons you may want to pay off your student loans sooner rather than later.
Interest. Interest. Interest.
Interest continues to accrue for the life of most student loans. (Note: The timetable of when interest starts to accrue on your student loans depends on the type of student loans you’ve been awarded. Contact your lender for all the details.) The sooner you pay off your loans, the sooner you stop interest from accruing.
Student loan interest does qualify for a tax deduction. But only $2,500 of the interest can be deducted each year — less if your modified adjusted gross income is greater than $70,000 a year.
Your Debt-to-Income Ratio May Be Lowered
When borrowing a mortgage or a car loan, the lender will usually consider the applicant’s debt-to-income ratio. And the lower it is, the better it looks from a financial perspective. Do you need a new car? Want to buy a house? Start a family? The sooner you get your student loan debt paid off, the more money you will likely have to put toward those dreams being realized.
Your Credit Score Could Strengthen
Your FICO® credit score is a powerful component of your total financial picture; tend it like a garden, and it could grow. There’s something to be said for the fact that if you’re managing an open debt responsibly by making on-time payments, that may have a positive impact on your credit score. And a higher FICO® score can help you get a better interest rate on a loan you might need for a home or car.
It’s Easier to Save Money When You’re Not Paying Down Debt
The conventional wisdom is the less debt you have, the more money you likely have to save. Think of successfully managing and paying off debt as a necessary exercise routine, like working your core. As your financial “core” gets stronger, you’re likely to become better able to balance your finances and save more money.
When you’ve repaid your student loans, the money you were spending each month on loan payments can instead be used to help you reach financial goals like starting an emergency fund, saving for a down payment on a house, or more. 💡 Quick Tip: When refinancing a student loan, you may shorten or extend the loan term. Shortening your loan term may result in higher monthly payments but significantly less total interest paid. A longer loan term typically results in lower monthly payments but more total interest paid.
How to Accelerate Your Student Loan Payments
You may be able to pay off your student loan debt more quickly by setting reasonable goals, including payments larger than the student loan repayment minimum required. As mentioned, both federal and private student loans generally allow for penalty-free prepayment but be sure to contact your loan provider before doing so to ensure your prepayments are being applied in the way that you want them to be. Here is a checklist that may help you eliminate your student loan debt sooner.
Calculating Your Costs
Make a list or spreadsheet of all your student loans. You can use a student loan calculator to help determine how much you ultimately owe (including interest) and when, ideally, you’d like to complete your student loan payments.
Making a Budget
Track your spending and make a realistic budget of your monthly and annual expenses. And leave some wiggle room for unexpected expenditures. Be honest with yourself. If you feel you’re spending too much on unnecessary expenses, maybe it’s time to skip your next urge to splurge.
Setting Manageable Goals
Now that you know how much money you have coming in and where it’s going, it might be time to make some uncomfortable, but fair, spending decisions with the intention of eliminating your student loans by your goal date. That means you may want to sacrifice some unnecessary expenses. Cutting back on non-necessities isn’t fun, but it may make it easier for you to save.
Paying Beyond the Minimum Required
As we mentioned, you can accelerate your loan payoff by paying more than the minimum student loan payment required by your loan provider. It’s okay to start small — even an extra $25 a month can start to add up. Paying more each month can also save you money on interest. You can ask your loan provider to put that extra cash toward the principal.
Avoiding Late Fees
An easy way to help ensure you pay at the same time every month is to set up an auto-draft from your checking or savings account. Some lenders may even offer a rate discount to student loan borrowers who enroll in automatic payments.
Maximizing “Surprise” Money
Are you doing so well at work that you got a raise or bonus? Rather than splurging on something new, lighten the burden of your current reality by putting that money toward your student loan debt.
Finding Extra Work
Every little bit of extra income can help. A part-time job could get you closer to your goal more quickly. If fitting in an extra 15 or 20 scheduled hours a week isn’t feasible, try finding a side hustle where you can make your own hours. You can work as a dog walker, become a rideshare driver, or even recharge electric scooters — all through an app.
Recommended: What is the Average Student Loan Debt After College?
Refinancing Your Student Loans
Refinancing your student loans might offer yet another step closer to your goal. Student loan refinancing is when you borrow a new loan (which is used to pay off your original loans) at a new interest rate and/or a new loan term.
One potential benefit of refinancing is the possibility of securing a lower interest rate. You could also potentially shorten your loan repayment term. But opting to shorten your loan term generally means paying more each month.
If you have a combination of private and federal loans, it’s possible to roll them into a single refinanced loan, which means having one monthly payment instead of multiple payments to multiple lenders. This is what is known as loan consolidation.
However, it’s very important to understand that by refinancing your federal loans, you lose federal student loan protections such as deferment and forbearance, and access to income-driven repayment programs. Take this into very careful consideration before moving forward with student loan refinancing with a private lender.
The Takeaway
Making more than the minimum student loan payments each month can help borrowers speed up their loan repayment and spend less in interest over the life of their loan. Lenders generally do not charge any fees for prepayment. To make the most of your extra payments, contact your lender to be sure they are being made to the principal value of the loan.
Refinancing could be another option for some borrowers to consider if they are interested in securing a lower interest rate on their loan — and provided that they don’t need access to federal programs or protections.
Looking to lower your monthly student loan payment? Refinancing may be one way to do it — by extending your loan term, getting a lower interest rate than what you currently have, or both. (Please note that refinancing federal loans makes them ineligible for federal forgiveness and protections. Also, lengthening your loan term may mean paying more in interest over the life of the loan.) SoFi student loan refinancing offers flexible terms that fit your budget.
With SoFi, refinancing is fast, easy, and all online. We offer competitive fixed and variable rates.
FAQ
What happens if I only pay the minimum on my student loans?
Making the minimum monthly payments on your student loan will generally result in your loan being paid off according to the original terms of the loan.
Is it worth paying off student loans early?
Paying off student loans ahead of schedule can make borrowing less expensive, because the borrower will likely spend less in interest over the life of the loan. Repaying student loans early could also have benefits like improving an individual’s debt-to-income ratio. Without the burden of student loans, borrowers might also be able to focus on other financial goals.
What is the average minimum student loan payment?
A borrower’s average monthly minimum federal student loan payment depends on factors including the total amount they owe, their interest rate, and the type of payment plan they’re enrolled in. For instance, on the Standard Repayment Plan, your payments are a fixed minimum amount of at least $50 a month.
Third-Party Brand Mentions: No brands, products, or companies mentioned are affiliated with SoFi, nor do they endorse or sponsor this article. Third-party trademarks referenced herein are property of their respective owners.
Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.
SoFi Loan Products SoFi loans are originated by SoFi Bank, N.A., NMLS #696891 (Member FDIC). For additional product-specific legal and licensing information, see SoFi.com/legal. Equal Housing Lender.
SoFi Private Student Loans Please borrow responsibly. SoFi Private Student Loans are not a substitute for federal loans, grants, and work-study programs. You should exhaust all your federal student aid options before you consider any private loans, including ours. Read our FAQs.
SoFi Private Student Loans are subject to program terms and restrictions, and applicants must meet SoFi’s eligibility and underwriting requirements. See SoFi.com/eligibility-criteria for more information. To view payment examples, click here. SoFi reserves the right to modify eligibility criteria at any time. This information is subject to change.
SoFi Student Loan Refinance NOTICE: The debt ceiling legislation passed on June 2, 2023, codifies into law that federal student loan borrowers will be reentering repayment. The US Department of Education or your student loan servicer, or lender if you have FFEL loans, will notify you directly when your payments will resume For more information, please go to https://docs.house.gov/billsthisweek/20230529/BILLS-118hrPIH-fiscalresponsibility.pdf https://studentaid.gov/announcements-events/covid-19
If you are a federal student loan borrower you should take time now to prepare for your payments to restart, including the opportunity to refinance your student loan debt at a lower APR or to extend your term to achieve a lower monthly payment. Please note that once you refinance federal student loans you will no longer be eligible for current or future flexible payment options available to federal loan borrowers, including but not limited to income based repayment plans or extended repayment plans.
Disclaimer: Many factors affect your credit scores and the interest rates you may receive. SoFi is not a Credit Repair Organization as defined under federal or state law, including the Credit Repair Organizations Act. SoFi does not provide “credit repair” services or advice or assistance regarding “rebuilding” or “improving” your credit record, credit history, or credit rating. For details, see the FTC’s website .
External Websites: The information and analysis provided through hyperlinks to third-party websites, while believed to be accurate, cannot be guaranteed by SoFi. Links are provided for informational purposes and should not be viewed as an endorsement.
The seemingly unstoppable rally in homebuilding stocks may face a few potential roadblocks ahead.
In recent months, the group has been notching record after record, posting their best first half in almost a decade. Homebuilders even rose during the pandemic, stumbling just briefly in 2022, before regaining traction. The cohort is also outperforming the broader market — up more than 50% year-to-date versus the S&P 500’s 18% gain.
Still, analysts warn to watch for factors that could threaten the sector’s growth.
“Builders are in the business of building shelter capacity,” said Carl Reichardt, a homebuilders analyst a BTIG. “Shelter capacity right now is very low. So the headwind to the group is if shelter capacity that isn’t bought by the homebuilders increases.”
So far, new homes being built by companies like D.R. Horton Inc. and Lennar Corp. have been snatched up by buyers. The activity has helped drive up each firm’s shares by more than 40% year-to-date.
However, their fortunes could diminish somewhat if dynamics in the existing home market shift, according to Reichardt, who added that a drop in rental prices could entice potential homebuyers into short-term leases instead of splurging on new houses.
A dip in interest rates could also disrupt housing market dynamics, he noted. The Federal Reserve’s aggressive monetary policy tightening campaign has dissuaded homeowners from moving, leading prospective buyers to seek new homes. That’s sent existing-home sales lower in nearly every month since the start of last year.
Rates Mystery
Eventually, the central bank will start to cut rates. While the timeline of that easing remains unclear, a decline in borrowing costs could reinvigorate existing homeowners to place their homes back on the market, introducing more inventory.
“Ironically, if rates went significantly lower from here, it could juice demand a little bit, but you also might have a lot of competition coming in from the resale side of things,” Oppenheimer & Co. analyst Tyler Batory said.
Some builders, including D.R. Horton and KB Home, target first-time homebuyers who would feel the effects of any financial burden. While the U.S. labor market has remained resilient, a wave of layoffs could dent the number of homebuyers, according to Batory. Additionally, the resumption of student loan payments might leave consumers with less cash on hand for big purchases like a house, he said.
According to a report from Redfin last month, first-time homebuyers need to earn 13% more than a year ago to afford the average US starter home. Another report from the real estate brokerage showed that the average U.S. homebuyer’s monthly mortgage payment is up almost 20% from a year ago as rates remain elevated.
Investors are being vigilant by seeking protection against declines in the group. Based on open interest, SPDR S&P Homebuilders ETF and iShares U.S. Home Construction ETF had the first- and third-largest put-to-call ratios, respectively, among exchange-traded funds with active options trading on Friday, according to data compiled by Bloomberg.
Of course, there’s always risks, said Batory, but all things considered, “It’s going to be fine. I think you have a multi-year earnings growth story.”
The cost of living in Minnesota sits within range of the national average, but just below. This affordable state is not only beautiful but an ideal spot for outdoor enthusiasts. From hiking and biking to every kind of water-based activity possible, you’re able to keep busy without setting a foot inside.
Add to that some great cities and small towns, friendly people and delicious food, and you’ve got a state that’s really the complete package.
The question, then, is can you afford to live in Minnesota? To figure that out, it’s best to break down all the elements that make up your total cost of living to see if everything fits into your budget. That means looking at:
Minnesota housing prices
Housing throughout Minnesota varies enough to give you plenty of options when needing to find your most affordable city. With numbers all below the national average, though, it’s not too much of a struggle to locate the perfect place to live in Minnesota.
Mankato
The great thing about Mankato is it feels like a small town, but has all the amenities of something a little bigger. The neighborhoods are cozy, but the city’s parks, rivers and hiking trails provide ample activities year-round. This means hitting your favorite lake to waterski in the summer and then, returning to ice fish in the winter. Home prices are also incredibly affordable at 25.2 percent below the national average.
Both apartment rent and home sale prices are on the more reasonable side in Mankato. The average rent in the city is $1,078, and the median sale price for a home in Mankato is $337,000. Home prices are rising though, up 38.8 percent over last year.
Minneapolis
Though the cost of living in Minneapolis is the highest in Minnesota, home prices here are still below the national average by 6.8 percent. This means there are so many great neighborhoods here to consider as your next home.
Situated right across the river from St. Paul, Minneapolis has amazing food, a great craft beer scene and a strong job market. The city shares many of its professional opportunities with its neighbor and combined, the two cities are home to a large number of Fortune 500 companies.
Rent prices here are also taking a downturn, with one-beds dropping 4 percent and two-beds down by 8 percent. Rent remains reasonable, although more expensive than any other Minnesota city on our list. Your average one-bedroom apartment costs $1,265 per month, and a two-bed apartment goes for an average of $1,595 per month.
Just as in St. Paul, home prices in Minneapolis are rising, but only barely. The median sale price in Minneapolis is $359,900, up 5.9 percent over last year.
St. Cloud
Considered a family-friendly community, St. Cloud offers up a stable economy, small-town comforts and popular events for every age, all year-round. Housing ranges from quaint bungalows to modern lofts with a few historic buildings tossed in there for good measure. What’s even better is that home prices are 17.9 percent below the national average.
This means low rent overall, even though certain units are seeing some serious growth when it comes to price. Although one-bedroom apartments are only up a single percent over last year, two-bedroom prices have increased by 17 percent. However, even with this growth, the average two-bedroom apartment rents for only $927 per month. One-bedroom apartments average out at $704 per month.
Home prices are almost the same, dropping in price only by 0.65 percent over last year. The median home price in St. Cloud is a reasonable $231,000.
St. Paul
As Minnesota’s capital city, St. Paul provides year-round outdoor fun alongside excellent job opportunities and affordable living. With water sports in the summer and skiing and snowboarding in the winter, you’ll always have a reason to get outside. To get a good dose of city life, stroll down Grand Avenue to wander into all the shops and restaurants along this historic strip. All of this is just the tip of the iceberg as to what makes St. Paul special, but even better, home prices are 8.2 percent below the national average.
When it comes to renting an apartment in this perfect town, rent prices are actually going down. Slipping at about the same rate, one-bedrooms saw a 14 percent drop over last year, and two-bedrooms went down by 13 percent. This keeps rent prices at a decent rate. The average one-bedroom apartment rents for $1,270 per month, and a two-bedroom is averaging out at $1,587 per month.
Home prices are going up, but just barely. Prices rose only 4.6 percent over last year. The median home price in St. Paul is $295,900.
Minnesota food prices
The cost of living in Minnesota is relatively reasonable, but food prices are actually on the higher end of the scale. Not every city is above the national average, but a few are.
St. Paul is 5 percent below the national average
Minneapolis is 2 percent below the national average
Mankato is 8.6 percent above the national average
St. Cloud is 13.9 percent above the national average
This aligns with shopping trends throughout the state, where the average Minnesotan’s monthly grocery bill is between $233 and $267. Now, what’s on that shopping list definitely impacts price. This can include ingredients to make your own Juicy Lucy or Tater Tot Hotdish. It could also mean splurging on a nice Walleye fillet. Regardless of what’s on your list, it’s good to know that ground beef is the most expensive in St. Cloud, but you’ll get the best deal on potatoes (for tots) in Minneapolis.
Minnesota utility prices
Winters in Minnesota are rough, which means your heater will work hard to keep your home warm and comfortable. The season is below-freezing temperatures and lots of snow. Heavy snowfall happens over a long season, from November to April, and the average number of annual blizzards is two.
Although winter is extreme, summer isn’t too bad. It’s hot and humid, but temperatures linger in the mid-80s. Your AC will run all summer long, but not to as big of an extreme as that winter heater.
As a result of this weather, utility prices can get high, however, overall, you’ll pay about the same as what’s average across the country.
Mankato is 3.7 percent below the national average
St. Cloud is 3.3 percent below the national average
St. Paul is 2.3 percent below the national average
Minneapolis is 1.1 percent below the national average
These close averages keep monthly energy bills in a very tight range. On average, expect to pay between $165 and $174 per month.
Minnesota transportation prices
Even with severely cold winters, certain cities in Minnesota are highly walkable. Minneapolis has a walk score of 75, and St. Paul’s is 61. Mankato and St. Cloud aren’t as walkable, but every city has a decent bike score, meaning Minnesota as a whole is pretty bike friendly.
This ability to get around by bike and on foot may positively impact transportation prices, making this particular expense in your cost of living in Minnesota below average. Of course, this isn’t the case everywhere.
Mankato is 7.7 percent below the national average
St. Cloud is 1.1 percent below the national average
St. Paul is 1.5 percent above the national average
Minneapolis is 4.8 percent above the national average
Public transportation, and owning your own vehicle, are most likely the two major contributors to your overall transportation expenses. Cars can cost a lot when you factor in maintenance, gas and paying for parking. Public transportation is a way to save a little money, even if you only use the service to commute back and forth to work during the week.
The METRO
Because the two cities are so close together, public transportation for Minneapolis and St. Paul combine through the METRO. The light rail, consisting of a blue line and green line, encompasses both cities. The blue line stays within Minneapolis, but the green line goes across the water.
The METRO also runs plenty of buses, a few rapid transit lines and a commuter rail. Fares vary based on time of day, so you’ll pay more during rush hour, which is from 6-9 a.m. and 3-6:30 p.m. Monday-Friday. Each fare is good for 2.5 hours. For local bus services, the non-rush hour fare is $2, and it’s $2.50 during rush hour. Six-hour passes are also available with a weekday rate of $4.50 and a weekend rate of $4.
The METRO bus also pops up in St. Cloud. Here there are 17 different routes that cross the city with a single-ride fare of $1.25. You can buy a variety of passes, as well from anywhere between $4.25 for a day pass to $47 for a monthly pass.
Mankato Transit
Operating its own transit system, the bus service in Mankato consists of eight routes that cover the entire city. This includes stops at Minnesota State University, Mankato. A single-ride fare is $1.50, but frequent rider passes are available in one-, 15- and 30-day passes. The monthly pass is $40 and is the best deal.
Minnesota healthcare prices
Healthcare prices in Minnesota can get high. Most cities are above the national average, and since this piece of your cost of living can include multiple doctors, there’s no way to know where the big bills will come in. Could it be a doctor’s visit, a trip to urgent care, the dentist or an eye doctor? What about those medications? Hopefully, your medical needs will stay affordable, but where you live could make the difference.
Minneapolis is 1.6 percent below the national average
St. Paul is 2.2 percent above the national average
Mankato is 2.9 percent above the national average
St. Cloud is 25.2 percent above the national average
As the most expensive when it comes to an average doctor’s visit, costs in St. Cloud reach $200.13. This is almost $50 more per visit than the least expensive city, Minneapolis. In fact, St. Cloud hits the top for an eye doctor visit and a dentist trip, although the price differentials aren’t as large.
Minnesota goods and services prices
Most cities in Minnesota hit above the national average when it comes to goods and services. These are all the items you put on the monthly budget that you could do without in a pinch. They include social activities, like grabbing a burger with friends, and maintenance tasks, like getting your hair cut.
The more items you have in this category, the higher your cost of living in Minnesota goes. Can you do without any if you had to?
Mankato is 4.8 percent below the national average
St. Paul is 5.3 percent above the national average
Minneapolis is 5.9 percent above the national average
St. Cloud is 6.5 percent about the national average
To decide if some budget cuts are necessary, based on these averages, it’s best to look at how much individual goods or services cost in each city. These are a few popular ones.
Although St. Cloud has the highest average when it comes to goods and services, it’s rarely the highest priced individually. Instead, that honor shifts based on what specifically you’re looking for. Minneapolis is the most expensive place to take a yoga class, and St. Paul has the highest haircut prices. When it comes to a burger, you’re going to pay the most in Mankato. Every city has its own pluses and minuses when it comes to pricing out all your bonus activities.
Taxes in Minnesota
Minnesota has a graduated income tax that hits four specific rates based on your income. You’ll either get taxed at 5.35 percent, 7.05 percent, 7.85 percent or 9.85 percent.
Sales tax in the state is a little less complex. Minnesota has a statewide rate of 6.875 percent. Localities are able to add an additional 2 percent to that total. At the maximum, for every $1,000 you spend shopping, $88.75 goes toward taxes.
Most cities don’t max out their sale tax.
St. Cloud is 7.625 percent
St. Paul and Mankato is 7.875 percent
Minneapolis is 8.025 percent
These rates align pretty closely with the average throughout Minnesota. Across the entire state, the combined average sales tax is 7.49 percent.
How much do I need to earn to live in Minnesota?
When analyzing the cost of living in Minnesota, being able to afford rent is at the top of your list. It will most likely be your biggest expense, and one that’s ongoing, at least until you decide to buy a property and pay a mortgage.
To calculate how much you’d need to earn to afford rent, you can refer to the experts. They suggest that 30 percent of your household income goes to this cost. With the average rent in Minnesota being $1,304, you’d need to make at least $52,160 for all the numbers to align.
The good news is the average household income in Minnesota is $74,593, so you’re well on your way to affording an average apartment, or even one with a few extras. To be sure, though, you can plug your specific information into our rent calculator.
Living in Minnesota
With all those lakes and the Mall of Americas, there’s really nothing that isn’t contained within Minnesota. As a great place for business, you can work hard, shop hard and hit nature hard all without going too far from home. What’s even better is that all this is pretty affordable.
The cost of living in Minnesota makes it accessible to most, but in order to figure out if it will work for you, make sure to take a close look at your own budget and must-haves. You may even find your ideal Minnesota city in the process.
Related articles:
The Cost of Living Index comes from coli.org.
The rent information included in this summary is based on a calculation of multifamily rental property inventory on Rent. as of August 2022.
Rent prices are for illustrative purposes only. This information does not constitute a pricing guarantee or financial advice related to the rental market.
If you live in a typical American household, 66% of which own a pet, you know the many benefits of being a pet parent. Pets provide companionship, reduce stress and even improve your health. Pet owners, especially those with dogs, are more likely to get outside and take a stroll through the park. So what could be the down side?
Although the benefits outweigh the costs, pets are expensive. It’s important to take a close look at the financial side of pet ownership before you add a new member to the family. Even if you’ve considered the adoption fee and supplies, the ongoing costs of food, grooming, and routine vet bills add up.
If you’re financially savvy, you may have looked into ways to save on pet food or perform at-home pet pedicures, but veterinary visits can add up. Scheduling routine physicals and keeping up to date on vaccines is the best preventative measure against future health conditions that may be costly to treat. Emergency medical care can leave even the most prepared pet owner in a mountain of debt. Or in the worst cases, economic euthanasia—a heartbreaking decision for any family.
Most people agree that the unconditional love of a pet is worth any amount of money. Still, preparing for the true cost of pet ownership can help you plan your budget. Pets become a part of the family, and making sure you can afford one can help you avoid tough decisions down the road. Fortunately, if you plan ahead, you can maintain the health of your pet and your finances.
Cost of Owning a Dog
Based on the average life span of 12 years, the lifetime cost of owning a dog can range from $20,000 to over $55,000. Studies show about half of all pet owners underestimate the cost of raising a pet. Before purchasing a dog, it’s important to understand both the initial cost of bringing a dog into your home and the ongoing annual expenses of raising a dog.
Note: Expenses and costs are possible ranges
One-Time Expenses
Aside from emergency care, most major expenses occur in the first year. New pet owners can expect to shell out nearly $400 for the bare necessities alone. Depending on the specific breed and size of dog, these costs could range well over $2,000. Below is a look at some initial costs you can expect to incur.
Adoption fee/cost: $0 to $700—can be higher depending on breed
Food and water bowls: $10 to $100
Spaying or neutering: $200 to $800
Initial medical exam and vaccines: $70 to $300
Collar, tags, and leash: $25 to $60
Bed and crate: $35 to $250
Carrying crate: $60 to $150
Microchipping: $20
Total one-time expenses: $420 to $2,180
In some cases, puppies can be more expensive than healthy adult dogs, since they need more shots and veterinary procedures. They may also require obedience training due to their boundless energy and tendency to chew on household items.
Annual Expenses
How much do dogs cost per year? According to the ASPCA, the average pet owner spends nearly $1,400 annually on their furry pal. However, other sources put this number much higher.
Below is a look at some of the expenses you can expect to incur every year you have a dog. If you have multiple dogs, these costs will be a lot more.
Food: $200 to $700
Vaccines and routine care: $200 to $500
Heartworm and flea prevention: $175 to $200
Vitamins: $58
License: $15
Treats and chew toys: $100 to $300
Grooming supplies: $25 to $75
Total average cost of owning a dog per year: $773 to $1,848
In addition to the basics, such as food and veterinary care, other routine and unexpected expenses will arise. You’ll also need to consider pet-related costs that come along with life events, such as travel and moving. For instance, many apartments charge a pet deposit. You also may need to pay additional cleaning fees.
Professional grooming: $200 to $400
Training: $100 to $400 per hour
Boarding and travel fees: $25/day
Accessories: $0 to $500
Pet health insurance: $225 to $516 annually
While raising your dog is a significant investment, most pet owners feel it’s money well spent. After all, you get paid back with unconditional love and affection.
Cost of Owning a Cat
Cats may be less expensive to own than dogs, but even these lower-maintenance creatures can put a dent in your bank account. For one reason, cats tend to live longer than dogs—they have a life span of about 15 years. Additionally, 44% of cat owners have more than one cat, compared to just 35% of dog owners. The average lifetime cost of owning a cat can range from $12,000 to $26,000.
The biggest factor affecting the life span and total expenses of a cat is whether it lives indoors or outdoors. An outdoor cat has a much shorter life span—only five years on average—and is at greater risk of injury from other animals, traffic, and diseases. If you plan to let your cat outdoors, lower your financial risk by vaccinating against diseases and purchasing pet insurance to cover potential injuries.
You also want to ensure it’s not illegal to let your cat roam outside in your area. If your beloved cat ends up at animal control, you’ll have to pay a fee to get it back.
One-Time Expenses
As with dogs, the initial expenses of cat ownership are the highest. You can expect to pay up to $1,000 when buying a cat.
Adoption fee/cost: $0 to $300—can be higher depending on breed
Food and water bowls: $5 to $30
Spaying or neutering: $145 to $200
Initial medical exam: $130 to $175
Collar or leash: $10 to $20
Litter box: $10 to $50
Cat bed: $20 to $100
Carrying crate: $35 to $70
Microchipping: $20
Total one-time expenses: $355 to $965
Annual Expenses
Of course, cats aren’t always predictable. You may have a certain cat food in mind—one that fits your budget—but that doesn’t mean your cat will like it. Cats can also be particular about the type of litter they use. Still, the following ranges give you an idea of what to expect in the years ahead.
Food: $200 to $500
Medical care and vaccines: $200 to $550
Flea and tick prevention: $140 to $200
Treats: $35 to $100
Litter: $150 to $200
Toys and scratching post: $20 to $100
License: $15
Grooming supplies: $28
Total annual cost to own a cat: $788 to $1,693
Cats have a penchant for knocking things off tables, and they don’t differentiate between empty toilet paper rolls and expensive vases. Additionally, they have sharp claws, and if you don’t give them someplace to scratch, they may turn your furniture into a shredding post. This is all to say you may want to set aside money for miscellaneous expenses.
Here are some other extras you may want to consider:
Pet health insurance: $175 to $350 per year
Accessories: $0 to $300
Pet sitting or boarding: $25/day
Ways to Save Money on Your Furry Pet
Pet costs can quickly get out of hand if you’re not careful. Fortunately, you can do several things to save money on care for your pets.
Spay or Neuter
Unless you’re a breeder, having your pet spayed or neutered should be one of your top priorities. Not only can this step help you save money in the long run, but it can also prevent unwanted litters of puppies or kittens.
Set a Budget
Setting a budget for your pet expenses can help you avoid spending too much on unnecessary purchases. Start by tracking how much you spend per month on pet care expenses. Use this information to set your budget for these costs.
Buy in Bulk
You can save a significant amount of money throughout the year by purchasing your pet food and treats in bulk. With proper storage, many types of pet food have a shelf life of up to 18 months.
Preventive Care
The best way to keep your pet’s medical expenses down is to invest in preventive care. Scheduling regular checkups, including dental care, and ensuring your pet is up to date on all necessary shots, including heartworm and vaccines against fleas and ticks, can avoid costly medical charges later.
Groom at Home
Instead of paying anywhere from $200 to $400 for professional grooming services, you can groom your pet at home. Once you purchase the original supplies, which can cost around $50, you can groom your pet at home for significantly less money.
Cash-Back Rewards and Loyalty Programs
Consider purchasing your pet supplies using a cash-back rewards credit card. This step can help you save money by earning cash back on your everyday purchases.
Should You Buy Pet Insurance to Cover Pet Costs?
One step that can make the cost of pet ownership more affordable is pet insurance. The right insurance plan can help cover some of your pet’s medical expenses. This, in turn, can reduce your out-of-pocket expenses.
Pet insurance can also give you peace of mind knowing that if your pet requires unexpected medical care, some costs may be covered. It’s important to realize not all pet insurance policies are alike. Be sure to carefully read the benefits and exclusions for each policy to ensure you select the one that’s right for your situation.
Prepare for the Unexpected
Emergency Vet Expenses
When you bring home your new fur baby, the last thing you want to think about is a tragedy or major illness hitting them, but it’s important to be prepared. Even if you establish healthy habits such as regular exercise, you should plan ahead for unexpected veterinary bills.
Once you become a pet parent, you may find that you’ll do anything for your canine or feline companion, even risking your credit to save their lives. While many pet owners feel that their pet’s well-being is worth the necessary sacrifices, setting aside money for a rainy day can help deflect some of the costs of an emergency procedure or unexpected illness.
Pet Insurance
Putting money aside for unexpected pet expenses is a good idea, but it’s difficult to save enough to cover a major medical bill—especially if you’re paying off existing debt at the same time. A diagnostic procedure alone can cost up to $2,000. And common medical conditions, such as orthopedic surgery or removing a foreign body can cost $7,000. If your pet has a chronic condition requiring regular follow-up visits or medications, your pet could rack up tens of thousands of dollars in medical expenses.
Rather than set yourself up to be forced to decide between your financial health and your pet’s health, plan for the worst by taking out pet insurance. With ongoing expenses adding up, it’s tempting to cut corners by skipping pet insurance, but the peace of mind it will give you is invaluable.
Tips for Budgeting for a Pet
Advance planning, such as signing up for health insurance or contributing to a savings account with your pet in mind, can help keep you out of financial water. But there are other ways to make pet ownership affordable and keep costs down.
Consider whether you’re willing to cut back in other areas
Being a responsible pet owner requires sacrifices of your time and sometimes, your finances. You may need to reconsider your morning latte once you’re splurging on treats for your new best friend.
It takes a village
Pet sitting or boarding can cost you $15 to $60 a day, but asking for help from friends and neighbors can save you money, even if you offer to pay for their time.
Search out low-cost clinics for routine pet care
Animal welfare organizations often offer low-cost vaccinations, spaying, and neutering, saving you money both now and in the long run by helping prevent costly medical conditions. Check with your local humane society or local pet rescue groups to get more information.
Avoid Pet Debt
Prevention can be the most effective tool for avoiding surprise pet costs. Regular exams help detect problems earlier making them less expensive and more likely to have a positive outcome. For example, spaying/neutering your pets reduces their risk of certain cancers.
If you can’t afford an expensive but necessary medical procedure, you may be able to get financial assistance from veterinary medical colleges or non-profit organizations. The American Veterinary Medical Association has a list of organizations that offer aid to pet owners with financial needs. This list is by no means comprehensive, so if you don’t find an option there, keep looking.
Credit Cards for Pet Owners
While you don’t want to rely on credit cards alone to cover the cost of owning a pet, choosing the right card can help you earn cash back and rewards points on pet-related purchases you’re already making. Some even offer 0% financing, which is useful for transferring a hefty vet bill from an existing card to a new one. Depending on whether you plan to use the card for pet purchases alone or everyday spending will help you determine which card is best for you.
If you’re considering bringing a furry friend home, make sure your credit is in good standing first. A credit card that rewards pet purchases can make it more affordable to own a pet. You’ll want to check your credit scores to know where your credit stands before you apply, so you can reduce the risk of a rejected application and come up with a plan to work your way toward better credit if necessary.
Kris and I joined some friends last weekend for a 40th birthday celebration at Bluehour, a swanky Portland restaurant. While the other couples spent $150 to $250 for their meals, we escaped paying only $52, including tip. We hadn’t planned to do this, but our unintentional parsimony taught us a few ways to save the … [Read more…]
Our discussion about how to eat for cheap generated a lot of great tips. Daiko shared a detailed explanation of how he once got by spending just $15/week on food. This is a great real-life example of how it’s possible to eat well without breaking the bank. I’m posting it here so that more people will see it.
Although I don’t do this now, I once lived on $15 a week for food in the early 1990s. This was helped by the fact that my workplace fed me five meals a week, but I was still carrying the weight of sixteen additional meals (for slightly less than a dollar per meal). This was not easy or comfortable to do — I did it by necessity — but I believe it could still be done for $20/week in most parts of the U.S. Also, while I was satisfied at the time, the fare was probably a bit more spartan than most would willingly eat.
Here is some of what I did:
Never allow leftovers to go bad. I would cook one or two major meals per week. Sometimes this was a full-sized lasagna, sometimes fish that was on sale, sometimes a big pot of homemade spaghetti sauce or soup with lots of fresh vegetables added. It always included a big salad. This big meal would feed me dinners (and some lunches) for five or six days, and I could not afford to throw any of it away. I would eat leftovers almost every day. Every ounce of it was eaten over the course of the week. (J.D.’s note: Here’s an article on how to store your food so that it lasts longer.)
Supplement with inexpensive foods. Many will say this is unhealthy. It would have been if it had been all that I ate, but I definitely ate a lot of Ramen and macaroni and cheese. These were bought when on sale: Ramen 7-for-$1 (a deal I’ve seen as recently as last week) and Mac & Cheese 3-for-$1. I also could get canned tuna 3-for-$1 easily, and once or twice a year as a loss leader for 5-for-$1. Poor man’s tuna casserole was a staple and would feed me for two or three meals: one package of mac & cheese with one can tuna mixed in.
Shop in the produce aisle. This sounds counter-intuitive, because everyone “knows” that produce is expensive. But I would shop for the inexpensive produce (which tended to be seasonal). Potatoes, carrots, celery, lettuce, tomatoes (sometimes), oranges (sometimes), cabbage, etc. These all make great food and provide snacks that generally don’t spike your blood sugar like factory-made snacks do. Also, this may be obvious, but I would eat fruit in season. For example, apples were plentiful in the fall: I could get a bag for about $1 and would get one or two bags for the week. I would have apples with everything (and for snacks). Again, I could not afford to throw out a single apple, so I ate them all. And at that time of year, making an apple pie was in the budget too! (J.D.’s note: there’s an actual fitness regiment based around apples: The 3-Apple-a-Day Plan.)
Never eat out. I couldn’t have bought more than four or five meals for my $15 weekly food budget, and that’s assuming the cheap breakfast place that had meals for $2.95 a plate. I needed to get at least 16 meals out of that $15, so there was no room for the luxury of eating out.
Have substantial cereals for breakfast. Oatmeal and Grapenuts were keys to my success. They both filled me up and kept me filled up for much of the day. A single container of oatmeal — not the flavored packages, which are expensive and insubstantial, but the big boxes of loose Old Fashioned Oatmeal — would last slightly longer than a week, even if I ate it every day. At the time this cost about $1.99 per container. You can get it today easily for $2.99 per container.
Avoid junk food. Not one candy bar, bag of chips, pre-made peanut butter cracker, store-bought cookie, “breakfast bar”, or pack of gum could be afforded. This didn’t mean I didn’t have snacks: a bag of popcorn cost about $1, and if I had the money available I would get one. Also, I had flour, sugar, water, eggs (usually), oil, and oatmeal, so sometimes I would make oatmeal cookies (with raisins if I was splurging). Sometimes saltines were on sale and I would usually have peanut butter on the shelf, so I could make peanut butter crackers if I wanted.
Avoid pre-cooked foods. Frozen dinners, deli-made quiche, store-roasted chicken — all of these cost too much per serving. If I wanted quiche, I had to make it from scratch. The ingredients were in my budget and on my shelves. If I wanted chicken, I waited until it was on sale for $0.39/lb and roasted it myself. I then ate it for 6-8 meals before chucking the bones into a pot to make chicken soup and having that for another 6-8 meals.
Buy a basic paperback cookbook. Because I had to make most things from scratch, I bought a paperback copy of what is often called “The Plaid Cookbook”: the Better Homes & Gardens New Cookbook. I think it cost $6 at that time, and was not part of my food budget, but it paid itself back many times over. (J.D.’s note: it only costs $8 now.) If I wanted to make lasagna, it told me how. Did I manage to buy a roast beef on sale? The cookbook told me how to avoid ruining it in the oven. Pumpkin pie? apple pie? quiche? roast chicken? all was explained, and often within my budget because I could make it from standard, inexpensive ingredients.
Don’t buy beverages. There’s a reason Coca-Cola and Pepsi Co. have been good investments and consistent earners across the years: they are selling you water. During this tough time I did not buy soda, or water, or coffee, or tea, or any beverage other than milk (which was reserved for my breakfasts, and only on weeks when I was having boxed cereal). I think I bought hot cocoa mix during the winter, and that lasted several weeks. If I needed a sugar drink I used a tablespoon or two of lemon juice — which I had on hand as a cooking supply — and a tablespoon or two of sugar in a tall glass of iced water: instant soft drink for possibly $0.10.
Special Bonus Tip. I didn’t do this at the time, but I now know that using dried milk saves at least $1 per gallon. There are two tricks to using dried milk. First, invest in a glass container. I don’t know why, but dried milk tastes terrible when stored in plastic. Second, chill it. If you follow these two suggestions, you’ll be able to serve the milk to guests and they will never know. In fact, they will likely think you buy it from a dairy. (And yes, this is something that my family does now. We have been drinking almost exclusively dried milk for the last 7 years.) Dried milk also saves time and gas money: out of milk? No need to run to the convenience store, just mix it up. In this case we save almost $2.00 a gallon because milk is so much more expensive at the convenience store, and since the family drinks about a gallon a day, we save as much as $7-10 per week just by drinking dried milk.
There may have been other tricks that I’ve forgotten, but with only $15 to spend per week I had to think long and hard about buying anything that cost more than $1. Was it going to sustain me?
It was much harder when I started this radical budget, because I started from nothing. But over time, it got easier, in part because some items lasted longer than a week. For example, pantry items like a bag of sugar, a bag of flour, a bottle of oil, and a bag of brown sugar would generally last longer than a week. In the first weeks I had to buy a lot of these things and they used up a lot of my $15, but immediately they became the “money in the bank” that allowed me to buy other staples that might not last that long.
So, yes it is possible to eat without spending a fortune. Again, my food budget was radical by necessity, but the principles would still work today. I think $15/wk might not be enough now, but I think $20/wk would work, and I know that $30/wk would be fairly easy for a single person. For reference: $15/wk per person = $65/month for one and $260/month for a family of four. $30/wk per person = $130/month for one and $520/month for a family of four (which is about what my family spends on food now, and we don’t eat anywhere near the way I did back in the ’90s).
J.D.’s note: Even if you’re unwilling to take all of the steps Daiko did to save money, implementing just a few of them can help you cut your food budget. Also, another cheap beginner’s cookbook with simple recipes is Mark Bittman’s How to Cook Everything.
Inside: Want to know what is a rack of money? You are in the right place. Learn the slang to rack, stacks, and bands. Plus tips to have your rolling in the money.
Have you ever wondered how much money is in a “rack” or what a “band” or “stack” of cash actually is?
If so, you’re not alone.
These terms are often used in movies and TV shows to describe large sums of money, but they can be confusing if you’re not familiar with them.
In this post, we’ll demystify some of the most common slang terms for money so that you can sound like a pro next time someone asks you how much a “rack” is worth.
Also, we will give you tips to make sure you are making 1000 a day.
What is a Rack of Money?
Simply put, a rack typically refers to $1,000.
Picture this: you’ve got ten $100 bills neatly stacked and bound together. That’s a rack.
Now, if a friend tells you, “I need three racks for a down payment on a car,” they’re saying they need $3,000. Easy to grasp, isn’t it?
Just remember, song lyrics might’ve switched things up a bit, but in real-world slang, a rack is a cool grand.
So next time you hear “rack,” you know it’s all about that thousand-dollar action.
How Much Is a Rack of Money?
“A rack” is a popular slang term for $1,000, usually in the form of ten $100 bills bundled together.
Don’t be overwhelmed, it’s just street language for stacks of hundred-dollar bills.
So, whether you’re saving for a dream vacation or splurging on a new gadget, just remember to play it cool and count those racks!
This post may contain affiliate links, which helps us to continue providing relevant content and we receive a small commission at no cost to you. As an Amazon Associate, I earn from qualifying purchases. Please read the full disclosure here.
What is a band of money?
Ever heard of the term “band” and wondered what it means in the context of money?
Well, a band is simply slang for $1000 in cash, usually bundled together with a rubber band. Here’s a breakdown:
It originates from the band used to hold a stack of cash together.
The term is also widely used in pop culture, specifically in rap songs to signify wealth.
If the band contains more than $1,000, it’s prefixed with the amount. For instance, a “10G band” means $10,000.
So if you stumble upon a phrase like “He’s flaunting a lot of bands”, it just means he’s flashing quite a stash of cash, probably in the club or jamming along to a hit rap song.
how much is a stack?
Ever heard someone saying they’ve got a ‘stack’? Let me break it down for you.
In the world of ‘money slang’, a ‘stack’ literally refers to a bundle of cash. Specifically, it’s a colloquial term for $1,000.
Here’s a quick bullet-point breakdown for clarity:
A ‘stack’ is slang for $1,000, typically in cash.
The term has its roots in the practice of actually stacking cash, but today, it’s used mostly in an abstract sense.
To give you an example: if you made a quick $5000 from a side gig, you’d casually say, “I made five stacks on my gig last week.” Now there you have it, you’re one step closer to mastering ‘money slang’!
Now, time to make 5000 dollars fast yourself.
Picture a real stack of money in hand
Now, let’s go on a visual imagination and bring those money affirmations to real life.
Let’s start…
You desire a real-life “rack” of money. Or maybe even 10 racks in your life.
Your eyes are drawn to a thick bunch of crisp $100 bills, bound together by a clean, white currency strap.
Meeting your gaze, shining under the light, are the majestic portraits of Benjamin Franklin galore, symbolizing the high-value of the stack.
Held firmly in hand, the image invokes feelings of prosperity, power, and accomplishment.
Each detailed texture and precise print on the bills reiterate authenticity, and the sequential serial numbers on the top bill tell a story of fresh prints.
This tidy, impeccably stacked rack, with ten $100 bills, effortlessly communicates, “Hello, I’m $1000!”
The first step to achieving financial independence is believing you can.
Make sure you put your stack of money as one of your vision board pictures.
How much does a rack cost versus a band?
Hey there, let’s talk about racks and bands. You probably heard these razzle-dazzle slang terms in music or pop culture, right?
Well, when it comes to costs, they’re actually identical.
A rack equates to $1,000. In equivalent terms, a band is also $1,000, often bundled up in crisp bills.
Let’s take a peek at a comparison chart to make things clearer:
Term
Cost Equivalent
Stack of Money
$1,000
Rack
$1,000
Band
$1,000
See how they match up? Next time you hear these terms, you’ll know exactly what’s up!
Learn how much cash should I have on hand.
How to Make a Rack Quickly
While this post focuses on various slang terms for money, Money Bliss is known for providing solid ideas to make money based on my expertise and experience in finance and the economy.
Most people enjoy learning how to make money online as a beginner.
Here are a few methods you could employ:
Sell Unwanted Items: If you have unused goods at home, consider selling them on online platforms like eBay or Facebook Marketplace. This could be anything from clothes and accessories to furniture and electronics. Check out Flea Market Flipper.
Freelance Work: Websites such as Upwork or Fiverr provide a marketplace for freelancers with varied skills. If you have proficiency in fields such as writing, graphic design, programming, or marketing, you could find plenty of work here.
Trading Stocks: Making money in the market is something people have done for many years! When buying stocks, the basic objective is to buy when the price is low and sell when the price is high. The value of stocks is typically influenced by a variety of factors including financial performance, economic indicators, and market sentiment. Check out this investing course.
Trading Options: Trading options can be risky but potentially profitable if done correctly, as investors can leverage a small amount of money to control a larger amount of stock. Potential investors should elaborate on their comprehension of the trading world before venturing into it which includes understanding the different types of investment products, their individual risks, and potential rewards. Learn how fast you can make money with stocks.
Are you passionate about words and reading?
If so, proofreading could be a perfect fit for you, just like it’s been for countless of readers! Learn how you can create a freelance business as a proofreader.
Check out this free workshop!
Bookkeeping is the most stable, reliable & simple business to own. This is how to make a realistic income -either part-time or full-time.
Find out TODAY if this is THE business you’ve been looking for.
Selling printables is a profitable venture that entrepreneurs can tap into. These digital products, including anything from calendars to artwork, offer a low-overhead business model since they require minimal materials and can be created once and sold repeatedly. It’s an efficient way to harness one’s design skills to provide value to customers while generating a promising income stream. Learn more about selling printables.
Gig Economy: Apps platforms like Uber, Lyft or DoorDash offer an opportunity to make money fast based on the time you are willing to invest.
Tutoring and Teaching: If you’re well-versed in a subject, offer tutoring services or consider teaching an online course. Websites like Chegg Tutors make it easy to start.
Be a Virtual Assistant: As a virtual assistant with no experience, you can anticipate managing various administrative tasks from a remote location, such as data entry, scheduling appointments, and even aiding with digital marketing efforts. This career path offers flexibility, the possibility to work from home, and the chance to work with entrepreneurs from different sectors. Use this virtual assistant checklist to get started.
Rent out Your Space: If you have an extra room or a property, consider listing it on Airbnb or a similar property rental site. This can become a significant source of income with small investments in the upkeep of the property.
Remember, it’s vital to choose an option that aligns with your skills and interests to ensure it’s not only a source of quick cash but also a sustainable and enjoyable endeavor.
You need to consider the legality and ethicality of the ways you choose to make money fast.
This is the perfect side hustle if you don’t have much time, experience, or money.
Many earn over $10,000 in a year selling printables on Etsy. Learn how to get started by watching this free workshop.
If you’ve ever wanted to make a full-time income while working from home, you’re in the right place!
This intensive training combines thousands of hours of research, years of experience in growing a virtual assistant business, and the power of a coach who has helped thousands of students launch and grow their own business from scratch.
Time to Bring in Your Stacks of Money
Now that you know the lingo for money, you can impress your friends with your knowledge. Plus, you can use this new information for future reference.
In summary, the terms band, stack, and rack are used to represent these same amounts of money, particularly in slang context.
Usually, they signify $1,000 in cash, and the presence of more numbers indicates a multiple interest in this monetary sum.
Now, how many racks do you have? What are you doing to make money?
These are important aspects if you want to become financially independent.
Remember, keeping your money organized isn’t just tidy, it’s smart!
Next, up learn how much is 10 figures!
Know someone else that needs this, too? Then, please share!!
Everyone wants a home that reflects their taste. But redecorating can be expensive. However, with a personal loan you can get the funds you need easily. You can also look at some budget-friendly ideas to transform your home.
Budget-friendly tips for creating a homely space
When it comes to creating a warm and comfortable home, you don’t have to spend extravagantly. With some clever budget-friendly tips, you can transform your living space into a cosy haven, without compromising on style or comfort. Let’s see how.
Look for deals for your decor: Explore thrift stores, flea markets and online marketplaces for unique and inexpensive pieces that can add charm to your space. Don’t be afraid to give pre-loved items a new lease on life with a fresh coat of paint or some creative upcycling.
Get creative with your designs: Sometimes, all it takes is a touch of creativity to transform your home. Instead of splurging on expensive artwork, consider framing your favourite photographs or creating your artwork using inexpensive materials like canvas and acrylic paints. Incorporate personal touches that reflect your style and make your space feel truly unique.
Don’t go overboard on furniture: Opt for affordable alternatives when it comes to large furniture pieces. Look for second-hand furniture or consider refurbishing existing pieces with new upholstery or paint. You’ll be surprised at how a simple change in budget decorating ideas can bring new life into your furniture without emptying your wallet.
Keep comfort in mind: Focus on the small details that can make a big impact on the overall ambience of your home. Use cushions, throws and rugs to add warmth and comfort to your living spaces. Play with different textures and patterns to create visual interest and depth.
Play with light: Lighting can significantly influence the atmosphere of a room. Opt for warm-toned bulbs to create a cosy and inviting ambience. Even on a budget, you can create a warm and inviting atmosphere. Embrace the spirit of the festival by incorporating DIY crafts, natural elements, and soft lighting. Repurpose existing items and infuse your home with the enchanting aroma of incense or scented candles.
Creating a cosy home doesn’t have to be expensive. But if you find yourself falling short of funds to spruce up your home, don’t worry! Avail an Axis Bank Personal Loan to do up your home as per your tastes. Get a loan from as low as Rs 50,000 to as high as Rs 40 lakh as per your budget.
Some benefits of taking a personal loan for home improvement include:
Easy access to funds for any urgent or planned need without collateral
Meet your requirements without dipping into your savings
Easy approval based on your income and credit score
Quick disbursal of funds with minimal documentation
Personal Loan Interest rates starting from 10.49%
Option to repay in easy instalments as per your budget
Still unsure about eligibility? Check the personal loan eligibility criteria at Axis Bank’s intuitive website. You can also use our personal loan emi calculator.
Also Read: [Is it possible to get a second Personal Loan?]
Some crafty projects can add a personal touch
If you’re looking to add a personal touch to your home without spending too much, here are some budget-friendly DIY ideas that will help you add that personal touch to your home.
Repurpose and upcycle: Embrace the concept of budget decor by repurposing and upcycling items you already have. For instance, transform old jam jars into stylish candle holders or storage containers by painting them in your favourite colours or wrapping them with twine.
Create custom artwork: Add a personal touch to your walls by creating your own artwork. You don’t need to be an experienced painter to make beautiful pieces. Experiment with abstract painting techniques using budget-friendly acrylic paints on canvases or repurpose old wooden frames by filling them with fabric or scrapbook paper collages.
New from old: Transform plain cushions, curtains or tablecloths into eye-catching statement pieces with a few simple techniques. Add fabric trims, pompoms or tassels to enhance their visual appeal. Use fabric paint to create unique patterns or designs on plain fabric.
Personalised wall art: Showcase your favourite quotes, lyrics or meaningful words by creating personalised wall art. Print out the text in a stylish font and frame it with a thrift or repurposed frame. Alternatively, use stencils or vinyl decals to paint the words directly onto canvas or wooden plaques.
Conclusion
With a little creativity and effort, you can transform your space without overspending. Budget decorating ideas can be the way to go.
Disclaimer: This article is for information purpose only. The views expressed in this article are personal and do not necessarily constitute the views of Axis Bank Ltd. and its employees. Axis Bank Ltd. and/or the author shall not be responsible for any direct / indirect loss or liability incurred by the reader for taking any financial decisions based on the contents and information. Please consult your financial advisor before making any financial decision