Rake in Cash at Your Yard Sale

Posted on May 31, 2018May 24, 2018 by Lauren Schwahn

Your yard sale hosting strategy can determine whether you rake in cash or waste a day. If you pull it off, others get to enjoy the items collecting dust in your home while you pocket extra money.

For those who’ve never held a sale before — or at least not a successful one — here are a few tips for making it worth your while.

Before the sale

Schedule strategically. First, check your local government website to learn if you need a permit. Then, pick a date. Spring and summer are typically the most popular times for yard and garage sales. Fall can also be fruitful, because shoppers are searching for Christmas gifts, says Chris Heiska, who runs the yard sale website yardsalequeen.com.

Saturday morning through early afternoon sales are crowd-pleasers. Bargain hunters tend to arrive early, so Heiska recommends setting up about half an hour to an hour before your designated start time.

In most cases, it’s best to skip weekdays, evenings and holidays when foot traffic is light. Weather can deter visitors, too. Check the forecast so that you don’t accidentally schedule a sale during a downpour.

Advertise. What good is a yard sale if nobody shows up? Advertising is perhaps the most important way to make it thrive, Heiska says. Your recipe for success: Mix equal parts old-fashioned and modern methods.

Hang flyers on bulletin boards at your community grocery store and coffee shop
List details along with photos of select items on local online marketplaces such as those on Craigslist, Nextdoor and Facebook
Post signs throughout the neighborhood. They should be sturdy and easy to read from a distance.

Make sure your ads include key sale information, such as the date, time and location. Start advertising at least a few days in advance.

Curate your collection. Yard sales with various objects attract more customers than ones with a single category, like books or baby clothes, Heiska says. However, there are exceptions. “If you live in a neighborhood with all young families with small kids, having a kid yard sale with baby stuff could be really popular,” she says.

Best-selling items can vary by region, but small kitchen appliances, household goods, tools and newer sporting equipment usually sell well, Heiska says. “You don’t want to drag out your 1950s exercise bicycle. That will not sell.”

Other tough sells include adult-size clothing, DVDs and anything damaged beyond repair. Your front lawn isn’t the best venue for expensive property like fine jewelry or high-end KitchenAid mixers, either. Not only do yard sale shoppers expect cheap prices, but your items also can get stolen. Heiska recommends selling valuables through online marketplaces and keeping cash on your person instead of in a box.

Set fair prices. You won’t make out like a bandit charging nickels and dimes. At the same time, don’t expect anyone to pay $50 for your ratty old baseball cap and VHS collection. Heiska suggests pricing most objects at about a third or quarter of what they cost new. Or, hit up a few garage sales in your neighborhood in the weeks leading up to your own to get a feel for the going rates.

On sale day

Tidy up. Presentation and cleanliness are key. Place items on tables, rather than the ground, to spare customers’ aching backs. If you don’t have tables, improvise with boxes and boards. And if you’re selling clothes, pick a handful of pieces to neatly fold or hang up.

“Seeing a mountain of clothing on a tarp, that’s kind of a turnoff,” Heiska says. “If you select a few items of clothing that may draw people in, it makes it look like your stuff is worth more and that you took the time to set it up nicely.” She adds that a visually appealing display provides leverage to price the items a bit higher.

Think of your yard sale as “a little department store,” Heiska says. Create a furniture section, an electronics section and so on. Face movies, video games and books the same direction with the titles visible. As items sell, rearrange what’s left to make your tables look fuller. Another word to the wise: Eliminate anything stained, dusty or sticky. The last thing customers want is to leave a garage sale needing a shower.

Make it inviting. Safety should be the top priority. Clear the vicinity of pedestrian tripping hazards like holes and extension cords. Once you’ve drawn in visitors, give them a reason to stick around and browse. Strike up a little conversation and consider playing some background music.

After the sale

Sell or donate your leftovers. Unless you have a killer collection of merchandise — or you’re an incredibly smooth talker — you’ll probably have items left unsold. Before chucking them in the trash, try selling them for a few bucks at local thrift stores or on marketplaces like Letgo and Craigslist.

Don’t want to deal with another sale? You can also donate to a church, Goodwill or another charitable organization. Your donation may qualify for a tax deduction.

Keep these tips in mind whenever you hold a yard sale. You’ll probably pick up a few of your own over time, too.

The article Rake in Cash at Your Yard Sale originally appeared on NerdWallet.

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7 Ways to Save on Concert Tickets

Posted on May 29, 2018May 24, 2018 by Courtney Jespersen

A standing-room only pit ticket to one of Taylor Swift’s June concerts at Soldier Field in Chicago could cost you $895. Some would say that’s a high price to pay to see songs from “Reputation” performed live.

Before you drop a few hundred (or thousand) dollars on concert tickets, here are seven ways to save money on a live show. While every tip won’t apply to every show, you can use this list to find the strategies that will work for you.

1. Sit near the back

You won’t have the best view, but you’ll still hear the music. In general, a seat farther back at a concert costs less than sitting in the first row. Take a look at the price for nosebleed seats before you dish out more for the front section.

2. Buy from a reseller

Check out resale tickets from verified secondary sellers and ticket resale brokers — which can be offered at a better price and with a guarantee, according to Gary Adler, executive director and counsel of the National Association of Ticket Brokers (NATB), a nonprofit trade association and a member of the Council of Better Business Bureau’s National Partner program.

When in doubt, check a broker on VerifiedTicketSource.com to see if it’s an NATB member. Adler says members provide a 200% money-back guarantee if tickets aren’t delivered as specified.

Other resale options include ticket search engines or marketplaces, such as SeatGeek and StubHub, which are platforms for buying and selling tickets. Look for a guarantee at these sites as well.

Avoid potentially untrustworthy purchases, such as from an ad on Craigslist or someone on the street. “I really don’t like when people buy tickets outside of a venue,” Adler says. “I think that’s a really bad move.”

3. Wait until the last minute

While concert ticket prices are unpredictable, in some cases prices could drop as the performance approaches, says Chris Leyden, communications manager at SeatGeek.

Leyden says he once saw discounted same-day tickets on SeatGeek to a Miranda Lambert concert in Newark, New Jersey. “There were floor tickets for less than $10 because the concert was starting in less than two hours, it was a snowy day and people didn’t want to travel,” he says.

If you can attend a performance on a whim — or prices are too high ahead of time — check ticket marketplace websites and apps leading up to the show to see if sellers are unloading tickets for less.

4. Skip town

Ticket prices can vary depending on the location of the concert — even for the same artist and the same tour, Leyden says. Compare prices at concert venues to find lower prices.

“Check out the nearby shows,” Leyden says. “You don’t have to take a massive trip where you fly from Miami to St. Louis. If you live in New York, you can do a quick weekend trip to Philly or a weekend trip to Boston.”

5. Sit solo

When searching resale options, you’ll generally see better deals on single tickets, says Jessica Erskine, a spokesperson for StubHub.

“Often someone might buy tickets in threes or fours and have one friend who can’t make it, and they’re trying to sell that one ticket,” Erskine says. “It’s so hard to find someone who’s willing to go to a show as a single guest that often you can find single-price tickets at lower prices.”

6. Attend shows at the fair

OK, maybe Taylor Swift still isn’t in your budget. If you’re not picky about who you want to see live, check the fair circuit. Some county fairs grant free admission to a concert along with paid entry to the fair, which usually costs less than a concert ticket.

7. Earn cash back

Use cash-back websites like Ebates and BeFrugal, where you can earn money on purchases at select ticketing websites. For example, Ebates is offering up to 5% back at Ticketmaster. And for those trekking to out-of-town venues, luxury cash-back site Jewel, for example, offers money back on select travel. To earn cash back, become a member of the site and visit the portal before you make your purchase.

The article 7 Ways to Save on Concert Tickets originally appeared on NerdWallet.

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Debt-to-Income: What It Is, and Why You Should Understand It

Posted on May 24, 2018May 16, 2018 by Daniel Ramos

In any kind of lending, the organization giving the money wants to be sure that the borrower can actually afford to pay it back. Since a mortgage is typically the largest loan that a home buyer will have, lenders find it important to confirm that a borrower is not taking on too much debt. They use a couple different versions of the debt-to-income ratio to determine how much money a person can reasonably borrow.

What Is the Debt-to-Income Ratio?

People who spend less of their income on housing tend to have more money available for other things, like groceries, utilities, services, and incidental expenses. Homeowners who spend too much on their mortgage payments may not be able to save money in case of an emergency. That might make it harder for them to keep making the payments if something goes wrong . To help prevent this from happening, lenders use industry standards to calculate how much a person should be able to borrow. It is related to their income, debts, and expected mortgage payment. The ratio of debt to applicable income (DTI) ranges from 36 percent to 45 percent or higher, depending on the borrower’s:

credit score
funds available for down payment
employment history
assets in reserve

Certain loan programs may require that applicants meet higher restrictions on credit score or down payment in exchange for a higher DTI. While many homeowners understand that 20 percent down payments are customary, there are other options available to them, DTI depending.

How Does DTI Affect Buying Power?

The DTI matters to home buyers because it could seriously restrict their buying power, and thereby affecting their ability to get a mortgage, depending on the conditions in the market where they intend to look. Buyers with no other debts will encounter the first cap on the front-end ratio, since both ratios would be the same for them. Applicants with some other debts could be capped by either the front-end ratio or the back-end ratio, depending on the price of the homes they want to buy, and the total debts they will have to carry outside of the mortgage. Unless people have an income much higher than the regional average, or plan to buy homes that are comparatively inexpensive, their DTI ratio will limit their buying power in some way.

What Is Front-End vs Back-End DTI Ratios?

There are two versions of the DTI ratio. The first is tied to the monthly mortgage payment. This payment is made up of principal, interest, taxes, and insurance. This ratio, known as the “front-end ratio,” relates only the mortgage payment to borrowers’ gross income. Although lenders may set this ratio as low as 28 percent, some loan programs will allow a front-end ratio as high as 31 percent.

The back-end DTI ratio adds the mortgage payment to all the other debts that the borrowers have to make payments on each month. This might include payments that are not officially debts but are still required every month, like child support. Ideally, lenders want applicants to have a back-end ratio of 36 percent of their gross income. However, conventional and government-backed loan programs will approve qualified applicants with a back-end DTI of 43-45 percent. Some lenders may choose to approve loans for borrowers with a total DTI as high as 50 percent, although this is uncommon.

Can One Change Their DTI Ratio?

Fortunately, buyers have some options if they would like to alter their existing debt-to-income ratios. The first is to increase income, while the second involves decreasing debt load. Lenders will consider income from a variety of possible sources, as long as the borrower can adequately document it and its frequency. Although borrowers are not required to document income from a side business, they may choose to do so to improve their DTI. On the other side, people might opt to pay off some debts before they start shopping for a mortgage. Eliminating a certain percentage of monthly payments may decrease the back-end DTI enough to make a difference in buying power.

The debt-to-income ratio is one of the first things lenders look at to determine if an applicant can manage a mortgage. With an understanding of the DTI ratios and how they affect buyers, people can decide if they have what it takes to get a mortgage.

Daniel Ramos loves writing about personal finance, lifestyle, and interior decorating topics. When he’s not writing, he helps design snazzy home interiors in Denver.

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5 Survival Strategies for Camping on a Budget

Posted on May 22, 2018May 15, 2018 by Courtney Jespersen

Exploring nature and sleeping under the stars can be viewed as an economical vacation. But buying gear and booking campsites or renting an RV can add up.

With some cost-saving strategies, camping can fit a variety of budgets, whether you’re planning a car or RV camping trip or backpacking. Try these tips to enjoy the outdoors free of technology, traffic and a big tab.

1. Search for free campsites

Don’t unplug just yet — before you leave, put your phone to good use by finding a campsite on sites like Campendium.com or FreeCampsites.net.

Many campgrounds charge a nightly fee, but you’ll also find free camping options, says Brian Easterling, co-founder and president of Campendium, a campsite review app and website.

Campendium provides information on over 27,000 campsites (free and paid), including national and state parks and RV parks. Listings include user reviews, fees, photos, cell coverage and other details. Some sites have no nightly rate but may require a paid pass to gain access.

Word to the wise: Free campsites don’t always include the amenities of paid campgrounds, says Kristin Addis, CEO of Be My Travel Muse, a travel blog. If you choose a free site, locate a place close by where you can clean up; Addis says she’s paid for a shower at campgrounds near free sites for less than the campgrounds’ overnight fee.

2. Check the weather

Look up the forecast for your destination, including nightly lows, says Addis, who’s camped on every continent except Antarctica and has learned the value of an insulated sleeping bag.

“The most important thing is staying warm and comfortable in your tent,” Addis says. “So maybe the tent doesn’t need to be super fancy or expensive, but I would maybe spend a bit more on your sleeping bag so you’re not freezing.”

“The sleeping mat is important, too, that it’s insulated and keeps you enough off the ground (so) that you’re not getting bruised by rocks or roots,” she says.

Investing in good gear from the outset — even if it’s expensive — could save you money in the long run, rather than buying something that’s not quite right and having to replace it later.

3. Travel with less

Travel light, says Tom Lionvale, a backpacking instructor and adjunct faculty member at College of the Sequoias in California. You don’t want too much to carry; 20 pounds not including food and water is a good guideline for backpacking, he says. Even if you’re not backpacking, camping with less means purchasing less gear.

For equipment deals, check out online sales. REI.com features REI Garage, where you’ll find discounted clothing and gear. Backcountry.com showcases markdowns at its discount division Steep and Cheap.

And don’t forget about seasonal sales. For example, REI has an Anniversary Sale each May. You’ll also traditionally find lower prices on outdoor gear in October, the tail end of peak camping season. Another cost-saving option: Consider renting gear from an outdoor equipment store, particularly if you’re new to the experience.

“Borrow your equipment or rent your equipment because maybe you won’t like it after the first trip and then you’re stuck with all of that,” Lionvale says.

4. Find a place to rest

Whether you’re camping by car or RV, plan the route you’ll take and the stops you’ll make to and from your destination.

If you’re traveling by RV, Easterling recommends looking for dump stations for waste disposal ahead of time. If you’ll need to get some sleep along the journey, search online for free overnight RV parking, such as at rest areas and truck stops. Be sure to check local rules, since policies on if and how long you can park can vary.

“If you’re going on a road trip from San Francisco and you want to get to the Grand Canyon, and you want to do it cheaply, utilize rest areas and utilize free campsites for just your quick overnighters as you’re trying to make those miles with your family,” Easterling says.

5. Make your own rules

There are many ways to camp, so plan a trip that fits your budget. Skip the things you don’t need — like the latest camera if your smartphone will do.

“Anything goes,” Lionvale says. “I’ve seen men and women with World War I army surplus doing a good job and having a good time, and I’ve seen men and women with ultralight equipment having a miserable time.”

This article was written by NerdWallet and was originally published by The Associated Press.

The article 5 Survival Strategies for Camping on a Budget originally appeared on NerdWallet.

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Ask Brianna: 5 Money Mistakes 20-Somethings Make

Posted on May 17, 2018May 15, 2018 by Brianna McGurran

“Ask Brianna” is a column from NerdWallet for 20-somethings or anyone else starting out. I’m here to help you manage your money, find a job and pay off student loans — all the real-world stuff no one taught us how to do in college. Send your questions about postgrad life to askbrianna@nerdwallet.com.

You’re not supposed to know everything. Those of us who survived our 20s tend to forget that when we’re anxiously peddling advice to young adults. Growing up is mostly about learning, and, yes, sometimes making mistakes along the way.

It’s good to be aware of some of the more egregious errors, though — especially in an area like finance, where a few solid habits and strategies will pay off again and again. These are the five most common mistakes 20-somethings make; post them on your fridge and do your best to sidestep them.

1. Ignoring your financial flow

At your first job, and whenever you get a new one, it will take a few paychecks to notice how much money actually hits your bank account after taxes and deductions like health insurance. And your earnings can easily evaporate if you don’t pay attention.

“It’s not what you make; it’s what you get to keep that counts,” says John Gajkowski, co-founder of Money Managers Financial Group in Oak Brook, Illinois.

Use a budgeting app or choose one way to make all your purchases — a debit card or a credit card that you pay off each month — so you can easily track spending. Say you notice you’re really going to town on Lyft and Uber. Designate one weekend a month when you can hail a cab to your heart’s content, and use public transportation or other means the rest of the time.

2. Letting friends set the agenda

You’ll need serious willpower to avoid trying to keep up with friends who make more money than you, and who want to go out for drinks or dinner at places you can’t afford. When you make plans, get in the habit of being the one to suggest where you’ll meet, and be honest; a brief “I’m on a budget, so let’s check out that free Friday night event at the museum” will suffice.

3. Not realizing time is on your side — to save

Yes, you will probably make more money in the future. That doesn’t mean you should wait until then to save in your company’s 401(k). Do it now and you’ll build a habit; wait too long and saving will feel like cutting back.

“It’s a lot easier to start right at the beginning, because it only hurts for the first couple of weeks, and then you’re used to it,” Gajkowski says.

You’ll be richer if you start now. Save $200 a month starting at age 23, and at a 6% rate of return you could have about $425,000 at 65; start at 33 and you’d have about half that.

4. Jumping on quick student loan fixes

In the first quarter of this year, 2.6 million federal student loan borrowers paused their monthly payments through forbearance, according to government data.

In forbearance, payments are halted, but interest accrues. You’re in the hole a little deeper every day. That’s why it should be a last-ditch option for borrowers who’ve hit rough times.

Instead, ask your student loan servicer if you qualify for deferment first, since subsidized federal loans won’t accrue interest in the meantime. If not, in most cases, opt for an income-driven repayment plan, says Kevin Fudge, director of consumer advocacy at the nonprofit research and counseling organization American Student Assistance. Your bill will be in proportion to your income, and if you need a lower payment indefinitely, your balance will be forgiven after 20 or 25 years.

5. Digging deeper into debt for grad school

Going to graduate school is more and more common: In 2015, 12% of adults age 25 and older had a graduate degree, compared with 8% in 1995, according to the Urban Institute. But grad school is not always a sure way to have more financial flexibility in the future, especially if you need to take out more loans to go.

Exhaust other ways to pay first, like attending part time and taking advantage of tuition assistance from work. Adding to existing student loan debt isn’t something you should do lightly; use a student loan calculator to see what you’ll pay after you’re settled in your shiny new job after graduation. It may shock you.

This article was written by NerdWallet and was originally published by The Associated Press.

The article Ask Brianna: 5 Money Mistakes 20-Somethings Make originally appeared on NerdWallet.

Should You Fix Up or Break Up With Your Car?

Posted on May 15, 2018May 2, 2018 by Philip Reed

You’re looking at a $1,200 repair estimate for your ailing car when an ad catches your eye: a brand new set of wheels for a mere $450 a month.

At first, dumping your old car might seem like a no-brainer — and you can’t help picturing how good you would look in that new car. But automotive experts say you’ll almost always come out ahead — at least financially — by fixing old faithful. There are, however, other important considerations when deciding whether it’s time to say farewell.

The costs of buying new

“Even though the repair cost might hurt, you really have to think about buying a new car as a tremendously more expensive proposition,” says Jim Manelis, head of direct lending for Chase Auto Finance.

At the very least, for a reliable used car, expect to spend a minimum of $2,000, plus tax and registration fees, says Mark Holthoff, editor at Klipnik.com, a community website for used car enthusiasts. Depending on the severity of your car’s problems, “You can buy a lot of repairs for that kind of money,” Holthoff says.

Of course, there does come a point when it isn’t worth pouring money into a beater.

But where’s the breaking point?

“Start with the scale of the repair,” Manelis says. “Is it a $1,200 fix or is it a $5,000 fix?” Then, look up the current value of your car using an online pricing guide like Kelley Blue Book.

When repair costs start to exceed the vehicle’s value or one year’s worth of monthly payments on a replacement, it’s time to break up with your car, according to automotive site Edmunds and Consumer Reports, the product review site. As an example, say you’ve already spent $1,500 on repairs and now need a new engine for $3,500, and instead you could get a new or more reliable used car for $400 a month ($4,800 a year).

Beyond repair costs, Consumer Reports says to factor into your decision the savings from a new car with better fuel efficiency and the new car’s loss in value over time. Manelis also suggests thinking about your current car after repairs. Once it’s fixed up, what will it be worth and how long will it continue to run reliably?

To help answer the question of fixing a car or buying a new one, do a cost-per-mile comparison with the “Fix-it or Trade-it” calculator created by the Automatic Transmission Rebuilders Association.

However, Ron Montoya, senior consumer advice editor at Edmunds, says there’s another equally important consideration: peace of mind. “If breakdowns become frequent and you feel unsafe on the road, that’s the time to replace it.”

Deciding what to do

To make the best decision for your situation, consider the pros and cons of both options.

FIXING YOUR CAR

Faster than shopping for and buying a new vehicle.
No change in insurance costs.
The car’s history is known.
You won’t waste time and money advertising and selling your car.
But your repaired car might soon need more repairs.

BUYING A NEWER CAR

Purchase can include warranties and sometimes maintenance.
Recent cars have advanced safety features.
Younger cars are more reliable.
You’ll stop wasting time schlepping to the repair garage.
But a new car loan is a long-term financial commitment.

If you decide to fix up

“It’s imperative to have a mechanic that you trust” before you move forward with any repairs, Holthoff says. For example, the service department at a dealership might be more interested in frightening you with repair bills to get you to buy a new car.

Once the car is purring again, Holthoff says to continue driving it long enough to make up for the cost of the repairs. Later, if you decide to sell, you can do so with confidence once the car proves itself reliable again, and you’ve reaped the benefit of the repairs.

If you decide to break up

Even if you decide to part ways with your car, you’ll have to get it running again or sell it as-is for less money. If you can, make the repairs, then repay yourself after you sell the car.

“Honesty is the best policy,” Manelis says about selling a car with issues. Get an estimate for repairs and show that to a prospective buyer, then tell them you’re willing to reduce the price of the car by the amount to fix it.

This article was written by NerdWallet and was originally published by The Associated Press.

The article Should You Fix Up or Break Up With Your Car? originally appeared on NerdWallet.

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New Grads: Here Are the Top 5 Places to Invest

Posted on May 10, 2018May 1, 2018 by Arielle O'Shea

Your first adult job sprouts a new round of firsts: first couch that isn’t a futon, first bed that isn’t a futon, first kitchen table that isn’t a futon. And then, of course, there’s your first adult paycheck.

Ideally, that paycheck will sprout your first investment account. Because while investing may not be top of mind right out of college, it should be: Even small amounts add up big over time.

The trouble — aside from actually finding money in your budget to save and invest — is figuring out where to put it. Here are five options, in very particular order.

1. A 401(k) with matching dollars

Contributions to a traditional 401(k) come out of your paycheck pretax, which means you don’t pay taxes on that money … now. You’ll be taxed instead when you take distributions from the account in retirement.

Tax perks like this are common in retirement plans, but there are two unique factors that land the 401(k) in the top spot: a high annual contribution limit of $18,500, and employer matching dollars.

You’re unlikely to hit that limit when you’re just starting out, so let’s focus on the matching dollars here, which are just what they sound like: Many — though not all — companies that offer a 401(k) plan also offer to match participant contributions. That means when you contribute to your 401(k), your employer may contribute as well, up to a cap.

The details of matching programs vary — your company might throw in 50 cents for every dollar you do, or a full dollar on every dollar, or some other arrangement — but the facts don’t: This is free money. Contribute at least enough to your 401(k) to earn your full match.

2. An emergency fund

This is cheating: An emergency fund isn’t technically an investment. But let’s call it an investment in yourself — it’s pretty key to financial stability, which makes it worth a mention here.

You might or might not have heard this rule: Keep three to six months’ worth of expenses stashed in a savings account. That’s great, if you can swing it. But many new grads can’t, and if they can, it will be at the expense of other financial goals. So, new rule: $500 or $1,000 will float you through most emergencies. You can add more once you’re steadily investing elsewhere.

3. A Roth IRA

Roughly a third of workers — and 41% of millennials — aren’t offered a retirement plan like a 401(k).

If you’re in that group, your next best option is probably a Roth IRA.

You can contribute up to $5,500 per year, and contributions are made after-tax, so distributions in retirement are tax-free. That kind of arrangement is ideal for someone just out of college, because you’re locking in your current tax rate. Not only is that rate likely to be low — thank you, entry-level salary — but income taxes in general are low right now.

Tip: There is a Roth version of the 401(k) that is less mainstream than the standard 401(k), but gaining popularity — it’s also worth a look if your employer offers it.

4. A traditional IRA

One downside of the Roth IRA: To make the full annual contribution, your modified adjusted gross income as a single tax filer must be less than $120,000.

Needless to say, the salary of most new workers falls well below that boundary. If yours doesn’t? Drinks on you! And also, you should consider a traditional IRA instead.

The traditional IRA follows the standard 401(k) format — tax deduction now, taxes on distributions later — and shares a contribution limit with the Roth IRA. There is one important caveat: If you have a 401(k), you may not be able to deduct your traditional IRA contributions. You can read more about traditional IRAs and the deduction limits here.

5. A taxable brokerage account

This is an investment account without the tax perks — or the distribution rules — of a retirement account. Essentially, it’s a savings account you can use to trade stocks or buy mutual funds. It’s where you can continue investing once you’ve maxed out retirement accounts, or if you’d like to — gasp! — invest for nonretirement goals like a house, a wedding or avocado toast.

You can open this account at an online brokerage, if you want to get your hands dirty picking and choosing investments, or at a robo-advisor, which is what it sounds like: a computer-based investment advisor. (Here’s more about robo-advisors and what they do.) It’s your father’s gray-haired financial advisor, reimagined for millennials and anyone else who wants investment advice on the cheap.

This article was written by NerdWallet and was originally published by Forbes.

The article New Grads: Here Are the Top 5 Places to Invest originally appeared on NerdWallet.

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Money Advice for New Grads — and Some Old-School Wisdom

Posted on May 8, 2018May 2, 2018 by Liz Weston

Many basic principles about saving and investing don’t change. But plenty of other things do, including the economy, tax law and employment trends. So we asked leading personal finance experts to share with us the best money advice they ever received, as well as what they would tell today’s new graduates.

Here are their responses, edited for length and clarity:

Michelle Singletary

Michelle Singletary (photo courtesy of Michelle Singletary)

Washington Post personal finance columnist and author of “The 21 Day Financial Fast: Your Path to Financial Peace and Freedom”

The best advice I’ve ever gotten came from my grandmother, Big Mama. She told me to save money from every paycheck. Every. Single. Paycheck.

So, from the time I was 14 and earning money tutoring, I’ve saved something from every check I’ve gotten. Saving is so automatic for me I don’t even know how not to save.

What I’d tell new grads now is: The first day on your full-time job after graduation, sign up for the retirement workplace plan if there is one. If your job doesn’t have a retirement plan, open an investment account and get a low-cost growth index fund.

I know. Retirement is so far away. You figure you have time and those student loan payments won’t pay themselves. I get it. But what you have, we older folks would kill to have back. You’ve got time on your side and that’s better than any great stock tip.

David Bach

Author of several New York Times best-sellers including “The Automatic Millionaire”

The best advice I’ve ever gotten was “You’re never too young to invest.”

At age 7 my grandmother Rose Bach taught me how to invest by buying stock in McDonald’s, my favorite restaurant in the world at the time. Grandma Rose said, “You can work here and make minimum wage (hard way to become rich), you can eat here and spend money (that’s what you’re doing now) or you can own the place and make money from all your friends and everyone else who eats here. Investors get rich.” She taught me how to look up McDonald’s stock symbol in The Wall Street Journal and then walked me down to a brokerage firm and helped me buy one share. I’ve been investing ever since. It’s made me financially free for life.

What I’d tell new grads now is: Start young, find your “Latte Factor,” invest it — you can become rich.

The Latte Factor is a metaphor for how we spend small amounts of money on little things. That daily coffee that 5 million Americans (maybe you) will go have today at Starbucks that costs $5 a day could make you rich. Make the coffee at home for 25 cents or have the free coffee at work. Then invest the $5. Put that money into an index fund (say any S&P 500 fund).

If you like Starbucks coffee, fine. Drink it and invest in the stock.

Kathy Kristof

Kathy Kristof (photo courtesy of Kathy Kristof)

Editor of SideHusl.com and author of “Investing 101”

The best advice I’ve ever gotten was, “Spend less than you earn.” It’s ridiculously simple, but it helps you at every stage of life. When you’re just getting started, it helps you build savings and get out of debt. Later, it helps you accumulate the down payment for a house; afford to take time off, when you have kids — or when you want to travel or take a sabbatical. Later, savings will allow you to retire when you want — or tell a bad boss to get lost; you quit.

What I’d tell new grads now is: Get a job — even if it’s not your dream job. It doesn’t have to be a great job. It just has to be one where you have a boss, who will be willing to give you a recommendation when you want to go on to something more serious.

Realize too that almost any job will teach you a few key lessons about work that will help you everywhere. Namely, half of the game is showing up on time, with a good attitude and appropriately dressed. If you listen, pitch in, apologize (and fix the problem) when you make mistakes, and show respect to your colleagues, they will be in your corner when you need them.

Kristin Wong

Kristin Wong (photo via Kristin Wong)

Author of “Get Money: Live the Life You Want, Not Just the Life You Can Afford”

The best advice I’ve ever gotten was from my mom, who is a master saver. When I was a kid, she told me, “Every dollar counts.” She came to the U.S. with nothing and somehow managed to save $10,000 in just a few years working a minimum wage job at a grocery store.

I do think there’s such a thing as being too frugal, but the greater lesson here is to focus on whatever you can do to improve your financial situation. Small moves can lead to great change.

What I’d tell new grads now is: Value your work and always negotiate job offers. When I got my first job out of college, I didn’t feel like I was in a position to negotiate because I had zero experience and I felt like I was lucky just to get a job. While that was true, I still had valuable skills that I learned in part-time jobs and other college activities. Anyway, in most cases, it doesn’t hurt to ask. And not only that, it sends a message to your employer that you are a confident employee who brings value to the job.

Lynnette Khalfani-Cox

CEO of AskTheMoneyCoach.com and author of “Perfect Credit: 7 Steps to a Great Credit Rating (2nd edition)”

The best money advice I ever got was from my sister, Debby: “Always bring your A-game and then ask for what you’re worth.”

That was her way of telling me to strive for excellence, be the best, and then not blink an eye when making salary and pay requests. It’s advice that’s served me so well over my career, both when I was a full-time financial journalist and had to negotiate pay raises, as well as the past 15 years as an entrepreneur when I’ve had to set my business rates and fees with clients. I feel like young women, especially, need to hear that advice and take seriously the message about the importance of negotiating from a position of strength. Your starting salary right out of college can have a big impact on future job/career offers.

What I’d tell new grads now is: Don’t wreck your credit! Poor credit can hurt your job prospects since many employers now do credit-based employment screening to determine who to hire and promote. Sadly, there are way too many opportunities for young adults to damage their credit rating: by paying bills late, overspending on credit cards, applying for too many bank or department store cards, and so on.

Jason Vitug

Founder of phroogal.com and author of “You Only Live Once: The Roadmap to Financial Wellness and a Purposeful Life”

The best money advice I ever got was to value my time more than money. Time is more valuable as it’s finite and once spent cannot be earned back. Money, however, is infinite and can be created and earned in many ways.

For a very long time, I believed the only way to earn more was to work more hours to show my managers that I deserved the extra $0.50 per hour or the 3% annual merit increase. But the more skilled you are, the more valuable you become, meaning employers will pay a premium for you. So use all your employer benefits such as tuition reimbursements, cross-departmental projects, and workplace seminars and classes. The investment of your time to becoming a master in your profession will reward you with promotions and higher salaries much quicker.

What I’d tell new grads now is: Resist the temptation to spend all that you make, and be mindful about lifestyle inflation. That’s when your spending increases at the same rate as your income. Lifestyle choices creep upward and are sticky. If left unchecked, that may lead to living paycheck-to-paycheck without an extra penny to save for future expenses or retirement.

Erin Lowry

Author of “Broke Millennial: Stop Scraping By and Get Your Financial Life Together”

The best money advice I ever got was that debt reduces your options. It’s not the most helpful advice for recent college grads who already have student loans, but avoid incurring any more! Don’t let lifestyle inflation put you in credit card debt, because what it ends up doing is just limiting your opportunities. Being debt free, especially free of consumer debt, positions you to be able to quit a steady job and join a startup or build your own business or [insert any dream here].

What I’d tell new grads now is: Ignore the “5-year plan.” I’m a classic Type A overplanner, but the job I do today is nothing I would’ve envisioned myself even being capable of doing when I graduated in 2011. So don’t stress about the silly interview questions like, “Where do you see yourself in five years?” and instead be open to the wide variety of possibilities, and don’t be afraid to take risks early on.

The article Money Advice for New Grads — and Some Old-School Wisdom originally appeared on NerdWallet.

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Ask Brianna: You Know You’re a Financial Adult When …

Posted on May 3, 2018April 27, 2018 by Brianna McGurran

Ask 10 people for their definition of “adulthood” and you’ll get 10 different answers. Maybe it’s getting that first full-time job, buying a house or doing taxes without help — concrete moments that signal maturity and independence.

But financial adulthood, or managing money responsibly, isn’t tied to an age or a milestone like starting your first “real job.” I knew I was a financial adult when I paid for a plane ticket with money I had saved in a “Fun Stuff” account. I’ve never been more excited to Venmo someone (my sister, who booked our tickets) directly from my bank rather than rely on my credit card.

You’re a financial adult when you save regularly, spend mindfully, face reality and know when to ask for help. If you’re graduating from college this spring, build these habits now.

Save proactively

Saving even a little bit every month is the single most adult financial move you can make.

Money is a way to get what you want: security and freedom. When you save a portion of the income left over after covering your fixed expenses, you’re preparing proactively for the future.

If the idea of sending this money to an “emergency fund” makes you completely tune out, just think of it as cash that’s there when you need it. You’ll be covered if you lose a job, but you’ll also have options if you decide to make a lifestyle change, like moving to a new place.

Spend thoughtfully

Getting a full-time job with a $50,000 salary after being a college student who ate pizza four times a week can be a shock. But hit the pause button before you make a big purchase, says Therese Nicklas, a certified financial planner in Rockland, Massachusetts. Make sure it will truly bring you joy, and that spending isn’t a way to get your mind off something else or compete with friends.

Take a look at your take-home salary and follow the 50/30/20 rule. That’s half your pay for necessities like shelter, 20% for saving and debt payoff, and 30% for your wants. The adult part? Giving up your wants if your necessities or debts demand it.

“You can have all the things you want, just not all at the same time,” says Kailie Abascal, a certified financial planner in Vancouver, Washington.

Never flinch from reality

Financial adults don’t cower at the sight of their bank account balance, even if it’s smaller than they’d like. Frankly assessing your personal financial picture will make it easier to manage.

If you have student loans, figure out what you’ll have to pay toward them after graduation. Use a student loan calculator to see your monthly payment, and budget around that. Create an online account with your student loan servicer and look up your interest rates. Know that if you put your payments on hold — to go to grad school, or if you’re unemployed — interest will accrue and your balance will grow, unless you have subsidized federal loans.

If you save for retirement in an employer-sponsored account, find out the vesting schedule, or the amount of time you must work there before any money your employer contributes becomes yours, Abascal says. You’ll have a clearer understanding of how much you’ve really saved if you end up leaving after a year or two.

Know when to ask for help

No one expects you to figure everything out right now. Your income, expenses and goals will change many times in your life.

But you should feel empowered to get advice, from the right sources, when you need it. Even your parents may not be the best resource if, for instance, you earn more than they do and they haven’t had experience handling the salary you’re getting, Nicklas says.

Have the courage to talk to human resources at work if you don’t understand your 401(k) investment options. Consider asking a certified financial planner for a free 30-minute consultation so you can set personalized saving and spending goals. There are few things more adult than admitting what you don’t know without judging yourself for it.

This article was written by NerdWallet and was originally published by The Associated Press.

The article Ask Brianna: You Know You’re a Financial Adult When … originally appeared on NerdWallet.

Prep for In-Flight Interviews and Land a Job

Posted on May 1, 2018April 24, 2018 by Kimberly Palmer

After a long morning of job interviews in Anderson, South Carolina, in 2007, Kevin Sherman prepared to board his airplane back to Michigan, where he was about to graduate from Michigan State with a mechanical engineering degree. He chatted with his fellow job interview candidates in the boarding area about other job opportunities.

As he got settled on the plane, his seatmate said he had overheard his conversation. “He said, ‘I’m an engineering manager,’” recalls Sherman, and the two struck up a conversation. “He interviewed me for two and a half hours,” Sherman says. Within weeks, Sherman, now 33, had accepted a formal job offer with the company, where he ended up working for four years — even meeting his wife there — before moving on for another opportunity.

As Sherman’s experience shows, the conversations you have on planes can change your life. Whether you’re traveling for business or pleasure, you can increase your chances of turning a casual conversation into a job interview by learning from people who have done just that. We spoke to three people who turned a plane ride into a networking session. Here are their tips.

Be on your best behavior, even when tested

When Sherman first sat down on the plane, he kept his backpack on his lap while he got settled. His seatmate — and future boss — made a comment that some might have taken to be rude: “He said, ‘I hope that’s not going to be on your lap the whole time,’” Sherman recalls.

Instead of responding snippily, Sherman calmly told him not to worry, he would soon be putting it away. A few minutes later, the conversation that turned into a job interview began. “If I would have said, ‘Don’t be a jerk,’ that wouldn’t have turned out well,” Sherman says.

Dress professionally and keep a resume handy

If you have a high chance of mingling with people who work in your industry — perhaps because the city you are visiting is hosting a conference — then dressing professionally on your plane ride can pay off. Since Sherman was coming from a job interview, he was wearing a suit, and he had extra resumes with him. That made it easy for him to make a good impression and hand his seatmate his resume, which included his contact information.

Practice your opener

For Carolyn Clancy, an executive vice president at Fidelity, the life-changing plane ride took place on her way home from a direct marketing association conference in 1999. She turned to the person next to her and asked, “Are you going home or are you on vacation?” — a line she frequently uses on airplanes as a conversation starter. “Every conversation is an opportunity to network,” she notes.

Clancy quickly discovered that her seatmate had been at a Fidelity sales conference, and they started talking about the future of marketing and the Internet, which was just starting to take off. After two hours of chatting, they exchanged business cards. The next morning, Clancy received a phone call from a Fidelity recruiter. Within two weeks, she had a new job at Fidelity, where she has been ever since.

Be curious

Even if you’re not job-hunting at the moment, Clancy says, plane conversations can be a chance to learn more about a new industry or company.

“Have a genuine curiosity and ask questions,” she says. “You could learn about where to take your next vacation, a great hotel, or how to do your job better.”

Resist the pull of your phone

If you’re staring at your phone or wearing headphones, it’s harder to start conversations that can lead to professional networking, Sherman says. After his morning of job interviews, he was ready to zone out to music, but he resisted the urge.

“Once he started talking and I realized the potential, I was excited, even though initially I didn’t want to have a conversation,” he says.

Try to book a seat near the front of the plane

Ryan Bonnici — chief marketing officer at the user review company G2 Crowd and a former flight attendant — says sitting near the front of the plane, even within coach, increases the chances that you will be seated next to frequent flyers, who tend to be business travelers. “They typically fly closer to the front of the plane,” he says.

Booking your flight early will help you nab one of these front seats. And if you can spring for a business- or first-class seat, then you have an even bigger chance of rubbing elbows with a business executive who might be able to boost your career, Bonnici says. You can also look for conversation opportunities while you’re in the waiting area or in airport lounges.

Don’t limit interactions to your seatmate

While you’re waiting for the lavatory, Bonnici says, you can introduce yourself to the person standing near you. As at your seat, though, steer clear of people sending signals that they don’t feel like chatting. He says lack of eye contact or super-short responses to your questions are all signs that you should turn your conversation elsewhere.

Bonnici made a connection on a plane almost 10 years ago that changed his career while he was welcoming passengers as a flight attendant aboard a flight from Australia to the United States. He started talking with someone who worked in marketing at Microsoft, and that connection led Bonnici to shift careers and pursue marketing, a field in which he still works today.

Don’t say goodbye without trading information

Whether it’s by sharing email addresses or business cards, be sure you have a way to follow up with the person before leaving the plane. Then, send a short thank-you note within a day of your chat, and take any necessary next steps such as submitting your resume for an official job opening. Otherwise, that conversation at 30,000 feet could soon be forgotten.

The article Prep for In-Flight Interviews and Land a Job originally appeared on NerdWallet.

Image by Olena Kachmar via 123RF