The average American is expected to move a total of 11.4 times in their lifetime: that's a lot of U-Haul trips to be paying for. Here are a few essential things you'll need to know before (and after) you pack those boxes.
Sell the Junk
Or just junk it. Anyone who has read (or talked to somebody who's read) Marie Kondo's The Life-Changing Magic of Tidying Up: The Japanese Art of Decluttering and Organizing, knows that there's nothing healthy about hoarding. And most moving companies base their fees on cargo weight. So, all those souvenirs, books you haven't quite gotten to yet and swag from that job three jobs ago? If they're worth anything, someone else will buy 'em.
Plus: if you can't sell it, most charities will come on by and pick it up as a donation. They'll will even give you a value on your donations, allowing you to write it off your income taxes! Learn more about that here.
For an idea of how much your things are worth, here's a great donation valuation guide from Goodwill.
Never Pay For Boxes
Companies will try to sell you boxes: U-Haul sells them anywhere from $0.99 to $2.45 or in bundles that can go up to over $300. Forget about it. If you live in a city, or even any kind of small town, most businesses—particularly liquor stores and print shops— will be abundant with boxes they are desperate to get rid of. Just don't wait until the last week.
If you're feeling timid, check out freecycle to find out what people are dying to give away.
Another big secret: some boxes at the post office are free.
Move at the Right Time
According to an analysis from Unpakt, a comparative pricing company for moving services, the cost of actually moving from one-bedroom apartment can cost anywhere from $840 to $4,460, depending on what time of the year and the month you plan it. Try to get as much moving as possible done before the end of the month. And if you have any choice on what time of year, pick a time of that's not between the middle of May and the middle of September. It may be cold out, but your pocket will thank you.
The world is bigger than U-Haul and now. Don't stop yourself from getting an estimate from the big boys, but there are so many new app-based moving companies out there; check out bellhops, ghostuck and zootly, just name a few of the bigger ones. Zootly will put you in touch with the closest and most reliable movers in your immediate vicinity while bellhops employs college students to move your things on the cheap. And don't forget, you can always take your lower estimate to U-Haul and they just might match your price!
Finally, make sure you let the IRS know you've moved—even if you've set up a forwarding address. A lot of mail stops getting forwarded after 60 days: especially mail like tax returns. Another tip: if your move can be tied, in any way, to your job you might be able to write the whole thing off.
When you take out a loan for a car, charge something to your credit card, or get a personal line of credit, there is going to be an interest rate that applies to your loan.
A lot of different factors go into what you will be charged, including your own personal credit score. But even those with flawless credit still see a minimum charge that they can't get around. That all goes back to the Federal Funds Rate.
One thing consumers rarely realize is that all of our banks are lending money to each other every night. Banks are legally required to maintain a certain percentage of their deposits in non-interest-bearing accounts at the Federal Reserve to ensure they have enough money to cover any withdrawals that may unexpectedly come up. However, deposits can fluctuate and it's very common for some banks to exceed the requirement on certain days while some fall short. In cases like this, banks actually lend each other money to ensure they meet the minimum balance. It's a bit hard to imagine these multibillion-dollar financial institutions needing to borrow money to tide them over for a bit, but it happens every single night at the Federal Reserve. It's also a nice deal for those with balances above the reserve balance requirement to earn a bit of money with cash that would normally just be sitting there.
The Federal Reserve
The exact interest rate the banks will charge each other is a matter of negotiation between them, but the Federal Open Market Committee (FOMC) (the arm of the Federal Reserve that sets monetary policy) meets eight times a year to set a target rate. They evaluate a multitude of economic indicators including unemployment, inflation, and consumer confidence to decide the best rate to keep the country in business. The weighted average of all interest rates across these interbank loans is the effective federal funds rate.
This rate has a huge impact on the economy overall as well as your personal finances. The federal funds rate is essentially the cheapest money available to a bank and that feeds into all of the other loans they make. Banks will add a slight upcharge to the rate set by the Fed to determine what is the lowest interest that they will announce for their most creditworthy customers, also known as the prime rate. If you have a variable interest rate loan (very common with credit cards and some student loans), it's likely that the interest rate you pay is a set percentage on top of that prime rate that your lender is paying. That's why in times of low interest rates (it was set at 0% during the Great Recession), a lot of borrowers should go for fixed interest rate loans that won't increase. However, if the federal funds rate was relatively high (it went up to 20% in the early 1980's), a variable interest rate loan may be a better decision as you would be charged less interest should the rate drop without the need to refinance.
The federal funds rate also has a major impact on your investment portfolio. The stock market reacts very strongly to any changes in interest rates from the Federal Reserve, as a lower rate makes it cheaper for companies to borrow and reinvest while a higher rate may restrict capital and slow short-term growth. If you have a significant portion of your investments in equities, a small change in the federal funds rate can have a large impact on your net worth.
Whether you're leaving a job involuntarily, departing for something new, or just want to prepare for the unknown, it is smart to understand all your options regarding your 401k.
Frugal gifting often gets a bad reputation. However, this shopping method does not make you cheap — it makes you practical. Frugal gifts often avoid waste and overspending and can be just as meaningful (if not more so) as any other present.
With the National Retail Federation predicting each consumer this holiday season to spend upwards of $1,000 on holiday gifts amidst an economic recession —this year might be the perfect time to reconsider your spending budget. We've formulated the ultimate list of frugal gift-giving ideas to get you started.