10 Ways to Save Money on School Uniforms for Kids

According to the National Center for Education Statistics, 1 in 5 public schools required students to wear uniforms as of the 2017-18 school year. These can be anything from identical outfits marked with the school’s name or logo to a basic color scheme, such as plain white shirts and tan pants.

According to 2011 research from the University of Nevada, Reno College of Education, a school uniform policy can have many benefits for students. It can make it easier to get ready for school, boost self-esteem, reduce bullying, and improve classroom discipline. But it has one big downside for parents: the cost. According to CostHelper, a school wardrobe of four or five uniforms can cost anywhere from $100 to $2,000.

One reason uniforms often cost more than regular clothes is that parents have less choice about where to buy them. If you can only get your kids’ school wardrobes from the official school store, you must pay whatever that store charges. However, you can get around this problem with the right shopping strategies. The first tip to try: shopping secondhand.

Ways to Save With Secondhand School Uniforms

Clothes are one thing it nearly always pays to buy secondhand if you can. With school uniforms, that’s doubly true.

Since young children grow so fast, their outgrown uniforms can still have lots of life left in them. Naturally, these previously worn uniforms don’t look brand-new, but neither do most school clothes after a few weeks of wear. Secondhand school uniforms cost much less than new ones, and in some cases, they’re free.

1. Try Uniform Swaps

If you have two children attending the same school, the younger kid can wear the older one’s hand-me-downs. But if you have only one child or your kids go to different schools, you can end up with clothes in good condition and no one to hand them down to.

A uniform swap is a way to expand your hand-me-down family. By pooling resources with other parents, you can pass on your child’s outgrown uniforms to younger students at your school and receive uniforms from older students in turn.

Some schools hold official uniform exchanges. For example, at St. Catharine School in Ohio, you can trade in gently used school uniforms for larger sizes or pick up other people’s trade-ins at significantly reduced prices. Other schools, like St. Stephen’s Academy in Oregon, give parents points for their trade-ins, which they can use for purchases or donate.

If your child’s school doesn’t have an official uniform exchange, hold a clothing swap party of your own. Invite other parents over, lay out all your outgrown uniform items, and see who can use them.

If you don’t have the space to meet and exchange clothes in person, start a social media group where parents can post photos and descriptions of their kids’ outgrown clothes. When you find someone who has the size your child needs or needs the size you have to give, you can contact each other to arrange a pickup.

2. Shop at Thrift Stores

If you live in or near a large city with a large student population, there’s a good chance you can find outgrown school uniforms at local thrift stores. Check the stores closest to your child’s school to maximize your chances of finding them.

Even in smaller cities and towns, thrift stores are an excellent place to look for basic pieces that are often part of a school uniform. Dress shirts, solid-color polo shirts, and chino pants are likely to show up on their racks. You can’t count on finding the pieces you need in your child’s size, but if you do, they’ll be significantly cheaper than new clothes.

To find thrift stores in your area, do an Internet search on “thrift stores” or “thrift shops” with your town’s name or zip code. Also, check the websites of the largest store chains — such as Goodwill, Salvation Army, and Value Village — to find their nearest locations.

3. Find Sellers Online

If you can’t find suitable secondhand clothes for your child’s uniform at local stores, try looking online. Start consulting your local Craigslist and Facebook Marketplace groups in early July, and look for new listings every other day or so. That gives you roughly two months to find all the pieces you need to build a complete school wardrobe for your child. Just be sure to contact sellers quickly when you find something you need so someone doesn’t beat you to it.

Another reliable source for secondhand uniforms online is eBay. You can create saved searches for each specific garment your child needs, such as “navy shorts size 8,” and receive daily emails of all new listings for your saved search. You can pick up pieces one at a time or — if you’re lucky — find a lot of uniform clothing all in the same size.


Ways to Save on New School Uniforms

The biggest downside of secondhand shopping is that you can’t be sure of finding what you need. If the start of the school year is approaching and you still don’t have a complete school wardrobe for your child, don’t panic. There are ways to buy new uniform-appropriate clothes and still keep costs down.

4. Buy the Minimum

For starters, don’t buy more of any component than you really need. Your child may need a clean shirt for school every day, but kids can usually get away with wearing the same skirt, pants, or sweater several days in a row. Jackets and ties can go even longer between cleanings.

How many pieces your child needs depends on how often you intend to do laundry. Mothers discussing their kids’ school wardrobes on Mumsnet generally say they include:

  • Five to 10 shirts
  • Two to five sweaters
  • Two to five skirts or pairs of pants or shorts

On top of that, you can add one or two school blazers and one or two dresses or jumpers if your uniform includes these pieces. And your child also needs at least one pair of school shoes and enough socks and underwear to last the week.

If you shop smart, you can put together this minimalist kids’ wardrobe for less than the $240 average parents reported spending on back-to-school clothes in a 2019 National Retail Federation survey. CostHelper says it’s possible to find pants and skirts for as little as $5 each, tops for as little as $3, and shoes starting at $15. That’s less than $100 for the whole wardrobe.

5. Visit Cheaper Stores

If your school’s uniform consists of basics like solid-color tops and pants, there’s no need to buy them at the official school store. Many major retail chains sell uniform-appropriate clothes for kids at quite reasonable prices. In fact, several retailers offer lines of kids’ clothes designed explicitly for this purpose, such as:

6. Shop Online

If stores in your area don’t carry the school uniform pieces you need at prices you like, try shopping online. Some online retailers specialize in school uniforms, and others have sections devoted to them. Good places to shop online include:

  • Amazon. The e-tail giant has an entire section called The School Uniform Shop. It provides links to uniform-appropriate garments from many popular brands, including Nautica, Izod, and Dockers. Alternatively, you can search for “school uniforms” to find apparel for girls and boys. Check out these Amazon savings tips for more ways to save.
  • French Toast. Online retailer French Toast deals in school uniforms for all ages, which you can search by school or gender. The site also offers two- and three-packs of identical shirts or pants for a discounted price per piece.
  • Lands’ End. The school uniform shop at Lands’ End offers sturdy clothing in all sizes, from toddler to adult. Clothes are covered by the brand’s unconditional lifetime guarantee. There’s even a selection of adaptive garments for kids with disabilities. This apparel combines easy-to-use magnetic closures with decorative buttons for a uniform look.
  • Lee Uniforms. For teens and young adults, the Lee Uniforms store on Amazon offers school- and work-friendly pieces. The selection is limited, but the prices are excellent.
  • SchoolUniforms.com. As its name implies, SchoolUniforms.com specializes in uniform basics, from blazers to plaid pleated skirts. Garments come in a range of sizes to fit children ages 3 and up, including plus sizes.

When shopping for uniforms online, you can save still more by using a mobile coupon app like Rakuten or Ibotta. If you prefer to shop from a computer, install a money-saving browser extension like Capital One Shopping to help you find great prices and available coupon codes.

Capital One Shopping compensates us when you get the browser extension using the links provided.

7. Wait for Sales

If your school has an official uniform store, call that store and see when it plans to offer discounts or promotions. In many cases, uniforms go on sale in October, after most parents have already bought their kids’ clothes for the year. You can save money on school uniforms by buying just enough pieces to get through September and waiting until October to stock up.

If the school uniform is a generic outfit available from many stores, keep an eye out for sales at all the stores in your area. Consider signing up for emails from your favorite local stores to let you know when uniform clothing goes on sale. Sometimes, these emails also provide coupons, which can boost your savings still more.

Timing your purchases can help at department stores too. Clothes often go on sale at the end of the season — for example, summer clothes in September or winter coats in March. If you plan ahead, you can save by buying school uniforms for next year during these end-of-season sales.

If you’re unsure when and where school uniforms are most likely to go on sale in your area, create a Google Alert for the term “school uniform sale” with your location or zip code. Whenever a new sale pops up, you’ll receive an email about it. You can also use the term “school uniform clearance” to learn about end-of-season clearance sales.

8. Check Out Clearance

Even when a department store isn’t having a sale, there’s usually a clearance rack you can check for marked-down clothing. Since school uniforms tend to be plain clothes without a lot of eye appeal, there are often at least a few pieces that don’t sell and end up on the clearance rack.

For example, the frugal-living bloggers at Life Your Way and Joyfully Thriving both report finding uniform pieces for less than $5 on the clearance racks at stores like Gap and Macy’s.

9. Buy Bigger Sizes

If your child is still growing, there’s a good chance the uniforms you buy now won’t fit by the end of the year. However, you can make them last as long as possible by sizing up.

Choosing clothes with an extra inch to spare in the legs and sleeves gives your kid room to grow into them. Some uniform pants and skirts come with adjustable waistbands, so they’ll accommodate your child’s growth in width as well as height.

And if you find a great price on a particular piece your child needs, you can buy next year’s sizes now. Assuming they plan to attend the same school for the foreseeable future, you know they’ll need the same uniform next year, so buying multiple sizes at once lets you get them all at the best possible price.

10. Buy to Last

If your child has stopped growing but still has a few more years of school to go, you can save money by choosing quality clothing that will last. These well-made pieces may cost more upfront than cheaper brands, but they pay off in the long run. A $50 blazer that wears out after one year costs $50 per year, but a $100 blazer that lasts for four years costs only $25 per year.

For example, clothes from Lands’ End come with a lifetime guarantee. If they don’t last your child until graduation (or they outgrow them), you can return them for a full refund. Clothing from Dickies, available at Walmart, is also guaranteed for its “expected life,” though they don’t define the term. Clothes from Target’s Cat & Jack line come with a one-year guarantee.

Another way to make school uniforms last as long as possible is to choose the darkest colors allowed. On light-colored clothes, minor spots or stains show up more vividly, making them unfit for school wear. Darker-colored clothing, such as maroon, navy, or forest green, hides these minor flaws.


Final Word

Saving on school uniforms doesn’t end when you’ve made your purchases for the year. If your kid’s uniforms become unwearable due to rips, stains, or lost buttons, you’ll have to replace them in a hurry — possibly at full price. To avoid this problem, handle school uniforms with care to make them last as long as possible.

Always follow the washing instructions and line dry or dry flat when possible to avoid wear and tear from the dryer. Treat stains promptly, repair rips, and replace buttons.

If your sewing skills are up to it, you can even get another year or two of life out of garments by letting down the cuffs or adjusting the waistband to fit your child’s larger size. Following all these steps reduces waste, so you can also pat yourself on the back for being green.

One final tip: Label all your kids’ school clothing with their names. When all the students in a school wear the same outfit, it’s easy for them to grab someone else’s sweater or jacket by mistake. Sewing in a name tag or writing on the care tag with a permanent marker increases the chances misplaced clothes will find their way home again.

Source: moneycrashers.com

17 Biggest Home Buying Mistakes & How to Avoid Them

Whether you’re a first-time homebuyer looking for a starter home or a seasoned homeowner ready to upgrade or downsize your property, the buying process is similar. From searching for the perfect place to call home to putting in an initial offer, it’s an exhilarating and life-changing adventure for new and experienced buyers alike.

And with such a major decision on the line, it’s important to make sure you don’t come to regret your decision in the future or miss out on your dream home by making a common — but avoidable — mistake.

17 Home Buying Mistakes to Avoid

Simple missteps like overestimating your DIY skills or making a lowball offer can put a damper on the excitement you feel during or following the home buying process. And they can cost you money, stress you out, and give you buyer’s remorse.

But, if you know what the most common mistakes are and you prepare in advance, you can bypass them — and the negative side effects they come with.

These are the most common home buying mistakes you should seek to avoid.

1. Not Reviewing Your Budget

Before you buy a home, you need to know what you can afford. This means taking a deep dive into your budget and reviewing your current costs and expenses, as well as estimating any new costs and expenses you’ll take on from owning a home.

For example, additional or increased costs may include:

  • Your monthly payment for rent or a mortgage
  • Property taxes
  • Homeowners insurance
  • Repairs and maintenance
  • Landscaping
  • Homeowners Association (HOA) or condo fees
  • Furniture
  • Utilities

You should also budget for a home emergency fund to cover potential problems like broken appliances or unexpected repair and maintenance costs.

If the estimated costs are too high, it might mean you have to rethink your budget by lowering your price range or reducing your homeowner expenses.

Knowing what you can afford beforehand ensures that you only look at houses within your budget and aren’t tempted to overspend.

2. Overlooking the Community

A house is one thing, but the community it’s in is another. Many homebuyers become excited about a particular property and fail to pay attention to the neighborhood or area it’s in. However, where a home is located can have a significant impact on your quality of life and overall happiness.

For example, pay attention to location-based factors such as:

  • The property’s proximity to an airport, dump, or train tracks
  • Whether it’s a family-oriented neighborhood
  • How close it is to amenities like public transportation, schools, and parks
  • How far it is from your place of work
  • Where necessities like grocery stores and gas stations are located

It’s also useful to look into future developments in the area, like commercial buildings, apartment complexes, and public spaces. If you’d prefer to live away from busy public areas, purchasing a property close to a future strip mall might not be a great option for you.

Or, if you want to be part of an up-and-coming area, planned developments give you a clear idea of what to expect in your neighborhood in the next few years, like new restaurants or off-leash dog parks.

Take some time to think about what you want to be close to or far from before you start your home search. Consider your interests and lifestyle to determine where your ideal property would be located, then use the information to ensure you wind up in a community that you feel good about.

3. Forgetting About Maintenance Costs

The great part about renting is that you don’t have to worry about the costs of homeownership like appliance repairs, building upkeep, or landscaping. But you do have to cover these expenses when you buy a new home.

As with forgetting to make a budget, forgetting to consider ongoing maintenance costs has the potential to wreak havoc on your finances. And avoiding maintenance and upkeep will only end up costing you more money in the long run because it will lead to larger repairs and more serious problems.

Homeowner maintenance includes a variety of recurring tasks, such as:

  • Mowing, trimming, and weeding
  • Snow removal
  • Applying paint and stain
  • Cleaning gutters
  • Pressure washing decks, patios, and siding
  • Chimney cleaning
  • Exterior window washing
  • Servicing your heating and cooling system

Depending on the home, it may also include tasks like replacing shingles, treating hardwood floors, or hiring an arborist to prune your trees.

When it comes to getting these jobs done, you can either take them on yourself or hire a professional to do them for you. However, both will cost you some combination of time and money.

Most home maintenance tasks require equipment. So if you plan to tackle them yourself, expect to cover the costs of equipment, like buying a lawnmower or a ladder or renting a pressure washer. And, if you hire a contractor to do your home maintenance for you, you’ll of course need to pay them.

Maintenance costs aren’t included in your mortgage loan, so you need to be able to cover them out of pocket. When reviewing properties, consider what kind of maintenance the property will need and whether you can afford it. Not only does it cost money, but it also takes a lot of time.

If a high-maintenance property isn’t a fit for your lifestyle or budget, look for something that requires less work, such as a newer home or lower-maintenance property like a condo.

4. Not Getting a Preapproval

One of the first steps you should take on your journey to homeownership is to get a mortgage preapproval. A preapproval is the amount a bank agrees to lend you based on factors like your savings, credit score, and debt-to-income ratio.

Having a preapproval tells you exactly how much a bank will allow you to borrow, giving you a maximum purchase price for your home.

Without being preapproved, you have no idea how much a mortgage lender is willing to give you or what your interest rate will be. This means you’ll be house shopping with no real budget in mind. You won’t even know if a bank will approve you at all, meaning you could be wasting your time even looking for a home in the first place.

Before you think about booking a showing or talking to a realtor, book an appointment with your bank or a mortgage broker. Find out exactly how much you have to work with so you can view homes within your price range and budget.

5. Only Looking at a Few Properties

Buying a home is a major undertaking, not just financially, but emotionally as well. Only looking at a handful of houses won’t give you a realistic picture of what’s on the market, what home prices are like, or whether something better is out there.

Book multiple showings to get a feel for your options. Even if you think you’ve found your dream home early on, there’s no guarantee you’ll get it. Keep your options open and check out a wide variety of properties to give yourself some perspective.

Who knows, you might find a hidden gem or dodge a bullet simply by taking your time and not limiting your options to a handful of properties.

6. Not Having a Real Estate Agent

When embarking on a home buying journey, you may be tempted to save yourself some money by opting to go without a buyer’s agent. But for most people, that’s a mistake. Unless you’re well-versed in real estate law and property negotiations, you should have a good real estate agent.

After all, their fees are typically covered in your mortgage as part of the closing costs of the home, meaning you don’t have to pay for them out of pocket.

But that’s not the only reason you should have a realtor when buying a property. A buyer’s agent provides many benefits, such as:

  • Networking with other realtors and property owners to find new and upcoming listings
  • Having access to property listing tools such as the MLS
  • Negotiating offers and conditions
  • Helping you to find a broker, lawyer, or other professional you may need
  • Handling important paperwork
  • Ensuring you’re aware of any important disclosures

An experienced buyer’s agent will work for you, helping you to find the perfect property not only for your lifestyle and budget but based on what’s available. They’ll take on the heavy lifting when it comes to paperwork, showings, and communicating with sellers and their agents, giving you a chance to focus on more important things.

7. Not Making a Wants vs. Needs List

Some people jump straight into viewing properties without evaluating their needs versus their wants. But it’s a common mistake that complicates the home buying process and causes decision paralysis. When buying a home, it’s essential to know what you need in your new home compared to what you would like it to have.

For example, if you have a dog, a yard could go on your needs list, while something like a pool or walk-in closet might go on your list of wants. If a lack of closet space would be a deal breaker for you, you might list the walk-in closet as a need for you instead.

You can give this list to your realtor, which will help them to filter through potential properties to show you. This saves both of you from wasting time viewing homes that won’t work for you.

And, it encourages you to get your priorities straight by forcing you to think about what you really need to be happy and fulfilled in your new home. Plus, knowing what you want gives you a better idea of your budget and which bonus features or upgrades you can afford.

If you don’t make a list, you could end up buying a property that isn’t a great match for your lifestyle.

8. Taking on Too Much Work

Fixer-uppers tend to be romanticized in reality TV shows about house flipping and interior design, but they’re a lot of work. Overestimating your DIY skills and taking on a house that’s going to require a significant amount of time and money to renovate or repair can quickly turn your motivation into buyer’s remorse.

On top of a mortgage payment, you’ll have to cover the costs of materials and labor for any upgrades or renovations that need to be done. If you’re handy, you can save money on labor, but you’ll still need tools, supplies, and a serious time commitment.

If you have to hire professional contractors to complete the work for you, expect costs to be relatively high depending on what you need done. If a home project goes over budget — which happens often — you don’t want to be left in a bad financial situation and an unfinished home.

Before moving ahead with a home purchase, consider how much work you’re willing to take on and how much of a renovation budget you can afford.

9. Buying in the Wrong Market

In real estate, there are two basic types of extreme markets: a buyer’s market and a seller’s market. In a buyer’s market, there are a variety of homes available for you to view and consider, meaning sellers are more likely to try to entice you with competitive prices and other incentives.

In a seller’s market, there aren’t many homes up for sale, so buyers have to compete against one another to win bidding wars. This often results in paying over the asking price, which increases monthly mortgage payments and possibly even your down payment.

The best time to buy a home is in a buyer’s market. Sometimes, waiting for a season or two to buy will save you a significant amount of money and keep you from the stress and uncertainty of buying in a seller’s market.

If you’re able to, buy when the market is in your favor and not working against you.

10. Feeling Uncertain

If you feel uncertain about a home, an offer, your real estate agent, or your financial situation, it’s not the right time for you to buy. Purchasing a house is one of the biggest financial commitments you’ll ever make, so you need to feel confident that you’re making the right choice for you, your budget, and your family.

If something feels off, carve out time to figure out what’s causing your uncertainty. It’s normal to feel nervous about taking on a home loan, especially if you’re a first-time homebuyer, but watch out for feelings of apprehension, uneasiness, or even dread.

Your home buying experience should be positive, so if your gut is telling you to reconsider, it might be best to take a step back and reevaluate.

That’s not to say you shouldn’t buy a home at all. It just means you need to change something about your situation, such as getting a new real estate agent, looking at more properties, or lowering your budget. Consider what will make you feel confident about buying a home and don’t move forward until you feel comfortable, positive, and satisfied.

11. Making a Lowball Offer

Making a lowball offer on a property is a rookie mistake that many seasoned and first-time homebuyers make. It offends home sellers, starting negotiations off on the wrong foot and sometimes even ending them altogether.

Sellers often spend a lot of time working with their real estate agents to price their homes based on the market, comparable homes in the neighborhood, and the state of the property. Just like you need to work within a budget for your home purchase, they need to make a certain amount of money from their home sale.

Lowball offers are rarely accepted and don’t provide much benefit to either party.

When making an offer on a home, listen to your real estate agent and offer a fair price. Being respectful and considering the true value of a home in your offers makes them more likely to be accepted.

12. Not Talking to a Broker

While a bank is often the first place you go to find out how much you can get approved for, they’re not your only option. A mortgage broker can provide you with a variety of different mortgage rates and terms from different lenders, allowing you to choose the best offer.

As with your bank, you’ll need to provide financial information like pay stubs, your credit score, and details about your assets and debts. The broker will use this information to shop around and find you the best interest rate and mortgage terms based on your financial situation.

Often, they can find you a better deal than what your bank is offering. However, make sure your broker has your best interests in mind. Don’t take out a mortgage with a disreputable or unestablished lender just to save some money.

A good broker can save you a lot in interest, so they’re worth talking to regardless of whether you choose to go with one of their offers.

13. Having a Small or Nonexistent Down Payment

There are a variety of different loans when it comes to buying a home, each with different down payment requirements:

  • VA home loans, which are for veterans and require as little as 0% down
  • Conventional loans, which are the most common for those with strong credit and no military service
  • FHA loans for borrowers with poor credit and low down payments

If you’re opting for a conventional loan, you’ll likely need to have a hefty down payment, especially if you want to avoid having to pay private mortgage insurance (PMI). Typically, you have to pay for PMI if you don’t have the minimum down payment required by a lender, and it’ll cost you anywhere from $50 to $200 per month.

Most lenders prefer to have at least 20% of the purchase price as a down payment. So, if you were buying a home for $350,000, you’d need to have $70,000 cash to put toward your mortgage.

Not planning for a sufficient down payment can put a huge damper on your home buying experience. It affects how much a lender will give you, your interest rate, and whether you have to pay PMI. Plus, it impacts your cash flow and the funds you have to put toward closing costs, renovations, and repairs.

Make sure you know how much you need in advance and plan ahead to avoid a disappointing and disheartening experience.

14. Going Without a Home Inspection

When you make an offer on a house, you have the option to make it dependent on a home inspection. Some lenders even make it a requirement of your mortgage terms. But if they don’t, or if you’re buying your property without a loan, you may choose to go without a home inspection.

But skipping a home inspection can cost you a lot of money and stress down the road.

Home inspectors are certified professionals who inspect a property’s condition. They review the structure, plumbing, electrical, exterior, and interior elements of the home and provide you with a report detailing any issues they find. For example, a home inspector would catch wiring that is not up to code or water damage in the basement.

These reports help you to avoid major repairs and give you an overview of the property’s condition. This can save you from buying a home that needs a new roof or that has a mold problem. Seeing as home inspections typically cost between $300 and $500, they’re often worth it.

Even if you choose to move ahead with a home purchase after you receive your inspection report, you can use it to renegotiate your offer based on any repairs that need to be made.

For example, if the report noted that the railing on the deck needs to be replaced, you could either request that the seller have it fixed or reduce your offer by how much it would cost a contractor to do.

15. Not Including the Right Conditions in an Offer

Your real estate agent will help you to figure out which conditions to put in your offer, but the most common include:

  • Home inspection
  • Financing
  • The sale of your current home
  • Closing date
  • Fixtures and appliances
  • Who pays which closing costs

You can also request an appraisal or survey, repairs, or specific cleaning tasks.

Conditions protect you so that you don’t commit to purchasing a house before you know you have financing and a home inspection in place. And they keep you from walking in on moving day only to find out the appliances weren’t included in your purchase price.

Base your conditions on the property you’re interested in and make sure they’re fair and within reason. Add too many unreasonable conditions to an offer and you risk getting rejected by a seller.

16. Not Seeing a House Yourself

Although video tours are OK, they don’t give you the full sensory experience of a home. You don’t pick up on any strange smells or noises, and you don’t truly get a feeling for the size or condition of the space or the neighborhood it’s in.

Even having a friend or family member view a home in your stead is a better option than going with video alone — especially if you won’t be able to visit yourself before you make an offer.

Ideally, though, you should visit and view a home yourself before you commit to buying it. If you happen to be buying a home in another state or country, try to plan a trip beforehand to look at houses. If you can’t do that, consider finding temporary housing to stay in after you arrive so you can search for a home in person.

If you don’t, you could end up buying a property you aren’t completely happy with or one that has unexpected issues.

17. Not Checking Your Credit Rating

Buying a house means having a solid grasp of your personal financial situation, including your credit score. Knowing your credit score keeps you from encountering any disappointing surprises when you talk to a bank or broker about getting preapproved for a mortgage.

Monitoring your credit score gives you a chance to improve it before you apply for a mortgage, increasing your chances of being approved and getting offered more competitive rates.

Check your credit score before you get too far into the home buying process to see what your rating is and whether you have any recent dings like late payments that may affect your interest rate or mortgage terms.


Final Word

Buying a house is meant to be an exciting and enjoyable experience. With such a major personal and financial commitment on the horizon, you want to do everything you can to avoid buyer’s remorse after you sign the dotted line.

Prepare yourself by getting your finances in order, having a clear idea of the kind of place you want to call home, and understanding the current market to have a happier, more successful home buying experience.

Source: moneycrashers.com

16 Tips to Save Money on Back-to-School Supplies & Shopping List

Back-to-school time has become its own shopping season, falling just behind back-to-college and Christmas in terms of family expenditures, according to the National Retail Federation. In 2020, the NRF reported record back-to-school spending, with parents spending an average of $789.49 per child, up from the previous record of $696.70.

And that’s just for elementary through high school. If you have college students in your family, the NRF estimates you’ll spend about $1,059.20 on supplies. (But you can access your own list of college back-to-school saving tactics.)

That’s almost as much as an average mortgage payment, and each year, costs continue to outpace inflation. Multiply this amount by two or three (or five) children, and it’s easy to see why many parents start sweating in mid-July, when the barrage of back-to-school fliers and ads start appearing.

But these back-to-school saving tips can take some of the stress out of the season.

How to Save on Back-to-School Supplies

If you’re stressed out about this upcoming drain on your bank account, take a deep breath. There are plenty of ways to avoid spending $1,000 per child at the start of the new school year. If you start early and plan ahead, you can put your kids back in the classroom for a fraction of this amount.

Keep in mind that back-to-school sales start a bit earlier each year. Staples now puts out its back-to-school section in late June, with many products already on sale to entice parents to buy.

You can save by purchasing one or two things at a time throughout the summer. Spreading your purchases out can also prevent a significant hit to your monthly budget.

1. Do a Supply Sweep

You probably already have plenty of last year’s school supplies you can reuse this year. Closets, desk drawers, and basement bins could hold hidden treasures that can save you money.

Start by rounding up all of the office and school supplies you already own. Put them in a central location, such as a plastic bin or the dining room table, so you can make a list of what you have and a shopping list of what you need.

Keep this list in your purse or car to avoid forgetting it when you shop for school supplies. You can also take a picture of your current supplies to refresh your memory when you’re shopping.

Next, go through your kids’ closets and start sorting. Donate or toss clothing kids have outgrown and timeworn clothing. Once you complete this supply sweep, you’ll have a clearer picture of what you need to buy. Ideally, the sweep will prevent you from buying something you already have on hand.

2. Plan a Supply Swap

Coordinate with your friends and neighbors and host a school and office supply swap before you head out shopping.

For instance, you might have reams of loose-leaf paper you bought on sale, but you’ll never use it all. Meanwhile, your friend might have several packs of pencils or a pencil case they’d be willing to trade for some of that paper.

Talk to friends and family members with school-aged children and see if they have extra supplies they’d be interested in trading.

3. Shop at Garage Sales and Thrift Stores

Garage sales can be a treasure trove of deals for back-to-school supplies. You can find backpacks, gently used shoes, clothing, and even school supplies there for a song.

Start hitting up garage sales for everything you need. It takes time, but you can score some incredible bargains by doing so, and it’s an economical way to save money on back-to-school clothes. You can also ask friends and family members to keep an eye out for you when they shop at garage sales.

There are fantastic bargains at thrift stores too. Clothing is very affordable there, and many stores run sales specifically for parents shopping for back-to-school items. But start early. Other shoppers will have picked over the selection by the first day of school.

Your best bet is to start your kids clothes shopping in the middle to end of July when there are plenty of clothes to choose from. Of course, if you let them wear them immediately, the novelty will have worn off by the first day of school. Put these clothes away until school starts so they’ll feel brand-new to your kids.

4. Check Consignment Shops

Consignment shops are excellent places to find gently used clothing because they’ve already vetted everything they offer. So unlike at the thrift store, you don’t have to paw through blouses from 1975 to find designer or name-brand clothing on a shoestring budget.

If your area has several consignment shops, find out if they’re planning a late-summer sale. Many consignment shops organize a seasonal sale, especially during the back-to-school shopping season. Several shops might even host a mega-sale in one location, pooling all their resources together.

You can find consignment shops in your area by Googling “kids consignment stores near me.”

5. Check the Dollar Store

You can get some incredible bargains on school supplies at the dollar store, where you can find basic supplies like notebooks and pencils as well as classroom supplies like facial tissue and sanitizer, all at bargain prices.

Start shopping in the summer months because you never know what products stores will order or how long they’ll stay in stock. Just note that there are some things you should never buy at the dollar store, such as batteries and tape.

6. Shop Through Rakuten

Online cash-back shopping venue Rakuten acts like a shopping gateway. The website allows you to shop online or through the app at over 2,500 major stores and brands like Amazon, eBay, Walmart, Gap, Barnes & Noble, Dell, Kohl’s, DSW, and Macy’s, all while giving you cash back on your purchases.

How much you earn typically varies from 1% to 6% of your total purchase price. However, many retailers offer short-term rebates of 10% or more and exclusive sales for Rakuten shoppers.

Rakuten says its 12 million users have earned over $1 billion in cash back using the mobile coupon app, which they can then use to buy back-to-school supplies.

See our Rakuten review for more information.

7. Install the Capital One Shopping Browser Extension

Capital One Shopping is a useful browser extension to have when you’re shopping online. For example, each time you’re browsing on Amazon, Capital One Shopping searches hundreds of other retailers to see if there’s a better price available.

They also automatically apply any available coupon codes at checkout to help you save money. Wikibuy has a database of thousands of retailers, so this extension can likely help you find a better deal somewhere.

Read our Capital One Shopping review for details.

8. Shop on a Sales Tax Holiday

Many states have sales tax holidays when shoppers can buy merchandise without paying sales tax. On these days, you can pick up clothing, computers, and school supplies tax-free.

Find the date (or dates) of your state’s sales tax holiday and determine what products are eligible online. Most states have a sales tax holiday during the first week of August, although some have tax holidays in July or toward the end of August.

9. Follow Stores on Twitter & Facebook

Many companies send their loyal followers coupon links and advance notice of sales. If you plan to bargain-hunt this year, monitor your favorite stores’ Twitter and Facebook feeds to find deals.

You can follow these popular stores on Twitter, for example:

10. Compare Prices

Most parents have to buy some sort of electronics for their kids for school. You can save on these by keeping an eye on Amazon’s ever-changing prices.

The website CamelCamelCamel tracks the price range history for every product sold on Amazon, including historical highs and lows. You can sign up for price change alerts for specific products and get a notification every time their prices change.

There are also plenty of apps to help you save money by comparing prices across different retailers. One is ShopSavvy, which is available for iOS and Android devices.

To use ShopSavvy, simply scan the bar code of the product you’re interested in, and the app tells you if a lower price is available at another store or website. For the app to work, you also need to download a bar code scanner, which you can get for both iOS and Android devices.

Last, don’t forget to look to your grocery store or neighborhood drugstore for bargains on school supplies. Check local circulars starting in midsummer. You might be surprised to find that some products are actually cheaper when they’re on sale at these stores than at big-box stores.

Additionally, many stores have reward or loyalty programs that enable you to earn points or other loyalty currency when purchasing goods there.

11. Focus on Saving on Big-Ticket Merchandise

When you’re back-to-school shopping, it’s easy to get paranoid about the cost of glue at Target compared to Walmart. We’ve all been there. But while it’s vital to watch prices on small items, you only have so much time and energy.

You’re better off using this limited time and energy to save money on bigger-ticket products, especially electronics like computers and tablets. Saving $300 on your high schooler’s new laptop means more to your budget than saving $5 on your middle schooler’s lunch box or 25 cents on a bottle of glitter glue.

Focus on saving money on your most significant expenses first, and let the glue take care of itself.

12. Make Your Kids Work for Their Supplies

What do you do if you’ve set spending limits for specialty or high-end goods, and your kids still clamor for expensive back-to-school gear? Make them go to work.

Assign them chores or send them out into the neighborhood to earn the money they need. My parents did this to me, and I lived through the experience. It also made me examine in a very real way how badly I wanted to buy some “must-have” gear.

Most of the time, when I had to spend my own money on something — money I had to use my own hours to earn — I discovered I didn’t really want it as badly as I thought I did.

13. Save on Uniforms

School uniforms used to be the hallmark of attending an elite private school. These days, many charter schools require students to wear uniforms, and The New Yorker reports that one-fifth of all public schools now require a uniform.

And these uniforms can be costly, with prices ranging from $150 to $250 or more for a mix-and-match wardrobe. However, there are plenty of ways to save money on school uniforms.

One strategy is to see if your school has a uniform exchange. During the year, some schools ask parents to donate any uniform pieces their children have outgrown. They then offer these to parents on a tight budget, often for free or for a small donation.

Another way to save is to check local thrift stores. For example, if your child’s uniform includes basic navy or khaki pants, you can usually find them in high quantities at a thrift store or consignment shop.

Last, check retailers like Gap and Old Navy. Both companies sell school uniforms and often run sales during the middle to end of summer. You might also find better deals if you shop in the early summer when most parents aren’t yet thinking about buying uniforms for the upcoming school season.

14. Hold Off on New Clothing

Every child wants new clothes when they head back to school. And while retailers do put clothing on sale for back to school, Kristin Cook, managing editor of price-tracking site Ben’s Bargains, told Consumer Reports before school starts isn’t the best time to buy a new wardrobe for your kids. Prices typically go down in September after the big clothes-buying rush is over.

A better strategy is to buy one new outfit for your kids to wear on the first day and then do most of your shopping when prices drop further in September or October.

Another way to save is to scour thrift stores and consignment shops. If you live near a larger city or are willing to travel, you can often find high-quality clothing at dirt-cheap prices there.

15. Save on School Sports and Activities

You have a daughter who wants to play softball and soccer, another daughter who wants to join the school band, and a son who wants to play hockey and baseball. You’re looking at a potential investment of $10,000 or more in fees, instruments, and equipment for this year alone.

But don’t start hyperventilating just yet. There are plenty of ways to save money on extracurricular activities for your kids.

First, think about limiting your children to one after-school activity apiece. By limiting their choices, you allow them to focus on what they’re most interested in. That also forces them to make a choice, and when they take ownership of that choice, they’ll likely feel more dedicated to what they’re doing and really put their heart into it.

UC Berkeley’s Greater Good cites a 2014 paper published by the American Psychological Association and a 1999 study published in the Review of General Psychology among the “mountain of research” proving teens who have the freedom to make their own decisions tend to be more self-driven and have greater self-discipline.

Sticking to one activity will also help you avoid having an overscheduled child and give them more time for academics, family time, and friends.

If you’re looking to save money on sports equipment, one strategy is to buy used. You can find used gear on SidelineSwap, where you can also sell your own equipment once your child has outgrown what they’re currently using. Locally, you can usually find some bargains at Play It Again Sports.

If you’re looking to save money on music lessons or band participation, your best bet is buying or renting a used instrument. You can search on Music Go Round for used instruments listed on the site and instruments listed locally in your area. You can also look on Craigslist and eBay.

16. Just Say No

Going back-to-school shopping with your kids can be a fun bonding experience. It can also add hundreds of dollars to your shopping bill if you cave to their requests for designer jeans and a new backpack.

To save money, tell your kids before you leave the house that you’re sticking to the school list and won’t consider any extras while you’re out. Of course, I have two kids of my own, so I know saying no isn’t always easy.

A better idea might be to go school shopping on your own. Consider buying your kids just what they might need on their very first day, and while they’re in school, you can hit the stores to knock out the rest of the list by yourself. Not only is it less stressful, but you’ll also likely save more money.


Final Word

Few parents want to think about shopping for the coming school year, especially amid high summer. But back-to-school shopping can creep up on you quickly, so it pays to start shopping early.

That way, you can take advantage of every deal and coupon that comes your way. And stocking supplies slowly can help ease the impact on your monthly budget.

Source: moneycrashers.com

9 Ways to Get Affordable Vet Care – Vet Clinics Near You

Pets at the vet
FamVeld / Shutterstock.com

One day, I noticed my puppy was acting strangely. She walked a few steps, stumbled, fell over and slowly got back up, only to fall over again. I realized her tummy was extremely bloated.

I rushed her to the emergency vet clinic. The vet examined her for a few minutes and started to chuckle. Then my puppy let out a bellowing burp, and the vet actually started to laugh.

When he asked me if I had left any dog food out, I remembered the large bowl on the kitchen floor for my other dog. My puppy had 4 cups of food in her half-cup stomach.

It wasn’t serious — although bloat can be a very serious condition — but I wasn’t laughing when I got the bill for $100. Finding an affordable vet clinic is an essential part of owning a pet.

Whether it’s routine care or surgery, your pet’s medical bills can get expensive. Here are some ways to find affordable vet care.

1. Look for low-cost alternatives

Local animal welfare organizations, rescue groups and shelters often offer low-cost vaccinations, spaying and neutering services. They also offer other affordable veterinary care.

Check out Petfinder’s animal welfare group search tool, or the ASPCA’s low-cost spay/neuter program search tool.

2. Try a veterinary school

Veterinary schools are typically cheaper than veterinary clinics and animal hospitals. While procedures are performed by students, they are supervised by a high-quality and experienced vet. This is a great option for affordable pet care.

Check out the American Veterinary Medical Association’s list of accredited veterinary colleges for a location near you.

3. Shop around

Veterinarians’ prices can vary widely. For example, when I was looking for a new vet in New Orleans, I called six different clinics. The base cost of a visit ranged from $35 to $75. So, check around.

4. Ask your vet for help

If your pet needs an expensive medical treatment or you’re struggling to cover the cost of an appointment, discuss the situation with your veterinarian. Some vets offer payment plans or discounts to their steady clients.

5. Find a charity

If your vet can’t help — and you can’t afford an expensive and necessary medical procedure — you may be able to get help from a charity service.

The Humane Society of the United States has a list of organizations that help with the cost of certain types of medical care for animals.

6. Look for cheaper prescriptions

If you’re buying prescription medication directly from your vet, you may be overpaying. Compare prices online at sites like:

The pharmacies of retail chains like Sam’s Club and Walmart also carry some pet meds. You can also use PharmacyChecker to compare prices.

Take your time and be careful when buying pet medications online, and deal only with reputable sites. Finally, ask your vet if he or she will match the best price you find.

7. Keep an eye out for specials

Just like human-centered businesses, vets offer specials. My vet has offered a 20% discount for new patients and $25 off dental cleanings. It’s an amazing way to find affordable vet care.

Be sure to check out veterinary websites and social media accounts for deals.

8. Be proactive to protect your pet’s health

Take precautions to reduce your pet’s chances of requiring expensive medical care. Such steps include:

  • Spaying or neutering, which can help lower the risk of some diseases in dogs and cats.
  • Annual wellness checkups. Also, keep up with the vaccination schedule, and make sure you discuss heartworm prevention with your vet.
  • Pet-proofing your home, such as keeping dangerous foods out of the reach of pets and avoiding bringing toxic plants into the house.

9. Compare treatments

If your pet has a serious medical condition, the most expensive treatment may not be the best course of action. Try searching “affordable vet clinics near me” or ask your vet about treatment options and costs, as well as the likely prognosis for your pet.

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Source: moneytalksnews.com

Moving With Kids: What Did They Love, Hate, And Learn?

Deciding to move is exciting, but the actual moving part can be downright tough. You try to plan for everything while juggling the process of settling into the new place. But, when you’re moving with kids, it’s a different challenge altogether! Not only are you tasked with helping them understand why they’re moving to a new place, they need help adjusting once you’re all there.

When we first decided to move, our youngest wasn’t on board, but our oldest was. It took a lot of discussion, but eventually everyone was excited for this new chapter. It’s been a month and a half since we moved, so I decided to sit down with my two kiddos, Kennedy (age 14) and Kelsey (age 13), to get their perspective on all things moving and the new house. 

moving with kidsmoving with kids
Kennedy and Kelsey sit down to give their own perspective on moving.

“What was your most favorite part of moving?”

Kennedy: “I love my new room!”
Kelsey: “We didn’t have a bathtub in our last house, so being able to take baths and use bath bombs is fun.”
Me: “Finally getting into the home we’ve been building for the past 6 months. In my head I’ve been planning things out, but it was finally time to make this house our home.”

TIP: When moving with kids, a great way to ease the transition is to celebrate any new home features that maybe you didn’t have before. In our case, we surprised the girls with bath gifts to celebrate having a new bathroom! It’s a small gesture, but can really help if they’re struggling to feel at ease. 

moving with kidsmoving with kids
To celebrate having a new bathroom, we surprised the girls with bath bombs and nail polish.

“What was the most stressful part of moving?” 

Kennedy: Figuring out which box I put my stuff in because I wasn’t very specific with my labeling.
Kelsey: Unpacking took FOREVER.
Me: Coordinating between all the deliveries and different companies who came to the house the first couple days. After that, getting unpacked and still enjoying the new neighborhood, it was definitely a balance.”

TIP: Moving with kids can be another level of stress not only for you, but for them. Having a smart, well-communicated moving plan and organized system in place can help minimize moving anxiety. 

(READ MORE: 5 Stress-Free Tips to Settle Into Your New Home Build!)

moving with kidsmoving with kids

“How have you made your new room feel like home?”

Kennedy: I’m redecorating my room the way that I want and what makes me happy.
Kelsey: I’m being more intentional with my room décor and only keeping things that I really like.
Mom: Even though I’m a DIY/ home décor blogger, I’m letting the girls take full control on their rooms. I haven’t decided if I’m even going to share their rooms on social media out of respect for their privacy. They’re getting older and privacy is a big thing right now.

“What do you wish you’d done to make the moving process easier?”

Kennedy: I should have labeled my boxes better.
Kelsey: I shouldn’t have dumped all my boxes out at once; I should have unpacked them one at a time.
Me: We didn’t have the wire racks put in the closets and wanted to do built ins instead. We should have installed the build-in closet system prior to moving. 

moving with kidsmoving with kids
Kelsey learned the hard way that dumping all the boxes at once wasn’t a good idea.

“What do you feel you need in the new environment? What are your concerns?”

Kennedy: Having everything in place and set up before we go back to school.
Kelsey: Making new friends in the neighborhood.
Mom: I want the girls to get adjusted to being in new schools and hopefully making new friends. We live in a great neighborhood, but they’re both in new schools this year and I want them to not feel so isolated like they did last year.

“What were you most thankful for during the moving process?”

Kennedy: The weather wasn’t too hot and we have a lot more room in our new house to move around.
Kelsey: I feel safer now that we live in a gated community.
Mom: The girls were able to go paddle board on the lake and go to the pool while we did the boring unpacking stuff. It’s great that they had that option and we felt safe letting them go do those things on their own. 

One of the perks of the new house is having a little lake behind the house for the girls to paddle board.

Always Remember to Check In and Show Gratitude

I loved sitting down and hearing what the girls had to say about moving and getting settled. Prior to moving, we all talked about packing, labeling, and unpacking — but in true teenager fashion, they didn’t quite listen. Now, they know firsthand why those plans were in place, and it gave us an opportunity to talk about what they’d learned and would do differently in the future. So take note, moving with kids can create some teachable moments!

Still, I give huge kudos to these two because they have been a tremendous help. Between loading the moving truck, unpacking, helping with the dogs, and countless other things, we were able to have a pretty successful move. Now that we’re almost two months into our new home, the move doesn’t seem that bad and now we can focus on making new memories as a family. 

Questions About Building a New Home?

If you’re considering a new home build, check out Homes.com’s “How to Build” guide, a comprehensive look at the process from start to finish. From financing to finishing touches, it’s your one-stop resource for all your home building questions!


Brooke has a lifestyle blog called Cribbs Style and currently lives in Charleston, SC. This wife, mom of two almost tweens, and mom of three fur children enjoys all things DIY and organizing. When she’s not helping others tackle the chaos of life, she’s either working out, at the beach, or just enjoying time with family and friends.

Source: homes.com

9 Ways to Save Money on College Textbooks

College is expensive, and the cost keeps going up.

It’s not just the sticker price of tuition, fees, and room and board. The materials most students need to succeed in class, such as textbooks, also tend to be pricey. The Bureau of Labor Statistics Consumer Price Index found that the price of textbooks went up by 135% between the start of 2011 and the start of 2021.

The high price of textbooks leaves some students with a tough choice to make.

They can try to scrape together the cash to buy the books they need or use student loans or other financial aid sources to cover the cost of textbooks. Some college students just skip buying them, which can negatively impact their class performance.

If the start of a new semester finds you scrambling to afford all the books on your course syllabi, there are ways to save money without skipping out on buying the book entirely.

How to Save Money on Textbooks

How much you can save on textbooks depends in large part on your major and the type of books you need for class. Plenty of courses ask you to buy books that aren’t technically “textbooks.”

You might need a copy of Toni Morrison’s first novel, “The Bluest Eye,” for an American literature class or a copy of Brené Brown’s “Dare to Lead” for a business leadership class.

Your theater class might call for copies of “Tick, Tick… Boom” by Jonathan Larson or Aeschylus’ “Oresteia.” For literary works, you can use the same strategies any reader uses to find cheap books.

If you’re taking a course in a STEM subject, it’s a different story, as you will most likely need to buy the most up-to-date version of the textbook. According to Vox, producing a STEM textbook is often labor-intensive, and that is usually reflected in the price.

Depending on the subject, you might need to get somewhat creative when it comes to reducing your books’ cost. Several strategies can help.

1. Look Beyond the Campus Bookstore

A college bookstore is basically like a convenience store. It’s there, it’s easy to get to if you live on campus, and it has what you need.

The trouble is you might not be getting the best price if you exclusively buy books (both new and used) from your school’s bookstore. It pays to shop around.

There are so many other options available now. You can find a copy of a brand-new textbook or an older edition at an online retailer or bookstore like Amazon. Some schools have a locally owned bookstore situated just outside the bounds of campus, and that store often sells books for much less than the official college store.

Comparison-shop to get the best price possible. Tools like Bookfinder.com or Capital One Shopping search the web for the titles you need and show you which store has them for a better price.

Capital One Shopping compensates us when you get the browser extension using the links provided.

2. Buy Used When You Can

With the exception of rare books, used books are pretty much always going to be cheaper than a new book.

Unless you need to buy the most recent edition of a book and the most recent edition was only published a month ago, you can pretty much always get by with a secondhand copy.

Used textbooks are all over the place. Your school’s bookstore is likely to have a few copies scattered in with the new editions. You can also look online at websites that specialize in selling textbooks or that sell books in general.

The list of sites that sell used textbooks is long, but some popular examples include:

One thing to pay attention to when buying a used book is the condition.

If you’re shopping online for your books, pay attention to the notes included by the seller. Some used books have a lot of highlighting, underlining, or notes scribbled in the margins. If that bothers you or will interfere with your use of the book, try to get a copy that is as clean as possible.

Another thing worth noting is that you often don’t get access to bonus material, such as online content (which requires a one-time use access code) when you buy a secondhand textbook.

For the most part, you should be fine without the additional content. But it’s worth checking with your professor to see if they expect you to use the online material.

3. Swap With Friends

The odds are likely you’ll take the same class as one or more of your friends throughout your college career, whether you have the same major or just need to fulfill similar general education requirements.

If you don’t take the same courses simultaneously, you might be able to swap books with friends, provided the instructor hasn’t changed the syllabus from one semester to the next. Your friends might be kind enough to give you their old books or let you buy the book for way less than it would cost at a used bookstore.

When I was in college, my friend took an American literature survey course the semester before me and was all too happy to sell me the literary anthology required for the course for the bargain price of $10 at the end of it.

4. Rent Instead of Buy

Let’s get real: Once your applied mathematics or chemistry course is over, you’re probably never going to look at the course materials again, let alone find yourself curled up on a Friday evening reading up on probability and distributions or kinetic molecular theory.

You only need the course materials during the class, so it doesn’t make sense to lay out your cash (or worse, incur student loans) and buy the book.

A better option is to rent your books for the semester. Luckily, plenty of stores that sell textbooks to students have also figured this out and will now happily let you rent textbooks. Many of the sites that sell used textbooks — such as Amazon, Chegg, sellbackyourBook.com, and CampusBooks — also offer textbook rentals.

It’s useful to crunch some numbers before you decide to rent a textbook instead of buying it. In some cases, renting textbooks might cost as much as buying a used version of the book.

It’s also worth noting that the rental term might not be the full length of the semester, so you may need to schedule your rental accordingly or risk having to extend it and pay more for the book.

5.  Go Digital

Digital textbooks, or e-books, often have a lower price tag than print copies. If you have a Kindle or another type of e-reader, you can usually get a better deal on the e-book version of a text than a print copy.

In some cases, it’s possible to get e-book versions of texts for free. Almost any text that is in the public domain is available to download for free. You can browse Amazon for free Kindle books or look on Project Gutenberg.

E-books have some advantages over print copies. You can highlight sections of the book or take notes without obscuring the text itself. You can also easily navigate to your notes and highlights rather than flipping through the text.

A potential drawback of e-books is that some textbooks can be unwieldy when converted to a digital format. A book with a lot of images might load slowly or be difficult to flip through. It might also be challenging to manage an e-book version of a textbook that requires you to jump around from page to page a lot.

6. Use the Library

Your campus library or local library might have the books you need for free.

Although some school and public libraries do have popular textbooks on their shelves, students who need to read literature like plays and novels or nonfiction works like biographies are probably going to have the most luck going this route.

For example, my local public library, the Free Library of Philadelphia, has over 100 copies of “Hamlet” by William Shakespeare. It also has several copies of the Norton Anthology of English Literature.

If you do plan to use a library to score textbooks for the semester, you might have to be a bit strategic about it. Place holds on the books you want to borrow to reduce the chance they’ll be unavailable when you go to check them out.

But be mindful of return limits or checkout limits. Most libraries let you renew books you’ve checked out, but only if another person isn’t waiting to use them.

7. Join the Open Textbook Library

Depending on the books your professors assign, you might be able to find them in the Open Textbook Library. The library consists of nearly 900 titles that have been faculty-reviewed and are available to students for free.

Some professors even assign books exclusively from the library. But even if they don’t, you might find the book you need in the library without any effort from your instructor.

If you like a particular professor and regularly take classes with them, it’s worthwhile to let them know about the program. If you’re lucky, they’ll decide to structure their course syllabi around books available in the Open Textbook Library in the future.

8. Share Books

Taking classes with friends can make even the dullest of general education courses a bit more fun. It also gives you a chance to save money on your books, especially if you and a friend decide to split the textbook’s cost.

Back in college, my friend and I took a class together. We shared our textbook, splitting the cost in half. We sat next to each other during the class and kept the book open between our desks.

If you’re going to do the same, make sure the person you’re splitting the book with is someone you’re close enough to that you see them regularly (preferably every day). It helps if you also live pretty close to each other to facilitate book drop-offs. In case of breakups, it’s better to split books with friends rather than romantic partners.

Along with coordinating how to share the book during the class, make a plan for the end of the course. It’s best to share books for courses that aren’t in your major or that you’re not particularly interested in. That way, it’s unlikely you’ll both want to keep the book at the end of the semester as a reference.

Either way, having a plan (and a backup plan) can keep the peace.

We sold the book back to the bookstore and split the amount we got paid evenly. But if one of you wants to keep the book, you can find out how much you’d get if you sold it back to the bookstore and pay the other half.

9. Space Out Your Purchases

Does this sound like you? At the start of every semester, you head to the bookstore or browse online with your syllabi in hand, purchasing every single book on your list right away.

While that’s a great way to knock out your book-buying to-do list, it’s also a great way to spend more than you need to on textbooks.

Despite what your professor says, those syllabi aren’t written in stone. They can change during the class, meaning you might not need a textbook until the last few weeks of class — or never at all. It’s better to buy, rent, or borrow your books as you need them so you don’t end up overbuying.


Final Word

Even if you get as many books from your local library as possible or borrow textbooks from your classmates, you’ll most likely have to buy at least one or two books. Luckily, you can recoup some of your textbooks’ cost by selling them at the end of the term.

Just as you should avoid buying your books from your campus bookstore, it’s also a good idea to avoid trying to sell the books back to the school store at the end of the term. Campus bookstores are notorious for offering a pittance for used textbooks or for flat-out refusing to buy certain copies. You’ll have better luck selling privately or through another reseller.

Source: moneycrashers.com

How Much to Put Into College Savings Accounts – Amounts by Age

The average cost of private college tuition was a staggering $35,087 for the 2020-21 school year, according to U.S. News & World Report. That’s nearly the median annual full-time income of $35,977.

What’s more, those costs only include direct tuition and fees. They say nothing of textbooks, room and board, and the other living expenses college students incur, which can add many more thousands of dollars each year.

All of which begs the question: How do middle-class families pay all these college costs?

It’s a question with many answers and one that every family has to answer for themselves. That said, you can follow several strategies to help your kids cover college costs without bankrupting yourself in the process — and while requiring them to put some of their own skin in the game

College Savings Accounts 101

You have two primary options for tax-sheltered college savings accounts: 529 plans and Coverdell Education Savings Accounts (ESAs).

Both work similarly and have a lot in common with Roth IRAs, in that you pay federal income taxes on contributions, but the money grows tax-free. The IRS does not tax withdrawals when used for legitimate higher education expenses like tuition, fees, or textbooks.

But you don’t want to overinvest in these accounts, as you can incur penalties if you use the money for expenses other than education. When in doubt, invest the money in other tax-sheltered accounts instead, such as IRAs, Roth IRAs, health savings accounts, or employer-sponsored retirement accounts like 401(k)s or SIMPLE IRAs.

You name a beneficiary when you set up the account, but both 529 accounts and ESAs allow you to change that beneficiary. If your older daughter gets a full-ride scholarship, you can switch the account beneficiary to your younger son. If he too surprises you with a full scholarship, you can change the beneficiary to a grandchild, niece, nephew, or even yourself.

As a final thought, keep in mind that financial aid offices do not see the funds in either of these two account types when reviewing applications for student aid.

Education Savings Accounts

Coverdell ESAs were created on the federal level, and the rules are consistent nationwide. The tax benefits work similarly to a Roth IRA, but you use the accounts for college education expenses rather than retirement.

You can contribute up to $2,000 annually per student, although the ability to contribute phases out for higher earners. Single filers’ ability to contribute phases out between incomes of $95,000 and $110,000, while married filers’ ability phases out between $190,000 and $220,000.

Like Roth IRAs, you can create the account with an investment brokerage like TD Ameritrade. You also get to pick and choose any investment options you want to hold within the account.

Contributors can withdraw money tax-free for not only college expenses, but any primary or secondary education expenses. And ESAs allow a broader definition of “education expenses” than 529 plans, including not just tuition, fees, and books but also equipment like computers and services like Internet access.

One downside to ESAs is the age limit: withdrawals can only be used for beneficiaries under 30. If your 31-year-old decides to go back and finish their degree, you’ll incur taxes and a 10% penalty on withdrawals.

529 Plans

Unlike ESAs, 529 college savings plans operate on the state level and vary considerably by state.

Many states offer two types of plans: an investment account and a prepaid tuition plan.

The investment plan operates similarly to an ESA, although the state manages the fund, so they pick the investments, not you. Some states offer a few different investment allocation options. But like ESAs, the money grows in the fund, and you withdraw it tax-free for college expenses.

Some states allow a tax deduction on your state tax return, in addition to allowing the money to grow tax-free — up to an annual cap, at any rate.

Prepaid tuition plans involve prepaying the state in advance for your child’s education. If your child attends an in-state university, you don’t pay another cent for tuition, assuming they graduate in four years. If your child changes their mind at the last minute and insists on going to another state’s school, you typically pay any overage in costs.

Historically, 529 plans could only be used to pay for college expenses. But as of January 1, 2018, you can now withdraw up to $10,000 per year to put toward primary or secondary schools as well. These plans place more restrictions on withdrawals than do ESAs, however, requiring withdrawals to be used only for tuition and fees, room, board, or books.

The contribution limits for 529 plans are far higher, at $15,000 per year in 2021. The plans do not phase out at higher income levels and do not place any age restrictions on beneficiaries.


How Much to Save Based on Your Child’s Age

By now you know your child’s college education costs could be one-tenth of their best friend’s costs — or 10 times as much. You can structure any tuition help you want to provide your child however you like, ranging from none at all to fully funding it.

If you plan to help out, I recommend choosing a target amount you plan to offer in assistance. It keeps your savings goals predictable and transparent, and it helps you set expectations with your child.

I created a table below, based on different monthly contribution amounts and lengths of time. The earlier you start, the less you have to contribute, as compounding steps in and starts doing much of the heavy lifting for you.

I assumed an 8% average annual return — in line with the 7% to 10% historic stock index performance, depending on which index you analyze.

Year $100/Month $200/Month $300/Month $400/Month $500/Month $600/Month
1 $1,252.93 $2,505.86 $3,758.80 $5,011.73 $6,264.66 $7,517.60
2 $2,609.15 $5,218.29 $7,827.44 $10,436.59 $13,045.74 $15,654.88
3 $4,077.16 $8,154.31 $12,231.47 $16,308.63 $20,385.79 $24,462.94
4 $5,666.18 $11,332.36 $16,998.54 $22,664.71 $28,330.89 $33,997.07
5 $7,386.19 $14,772.37 $22,158.56 $29,544.75 $36,930.93 $44,317.12
6 $9,247.98 $18,495.96 $27,743.94 $36,991.91 $46,239.89 $55,487.87
7 $11,263.24 $22,526.48 $33,789.73 $45,052.97 $56,316.21 $67,579.45
8 $13,444.63 $26,889.26 $40,333.88 $53,778.51 $67,223.14 $80,667.77
9 $15,805.83 $31,611.66 $47,417.49 $63,223.32 $79,029.15 $94,834.98
10 $18,361.67 $36,723.34 $55,085.01 $73,446.69 $91,808.36 $110,170.03
11 $21,128.20 $42,256.39 $63,384.59 $84,512.78 $105,640.98 $126,769.18
12 $24,122.77 $48,245.54 $72,368.31 $96,491.09 $120,613.86 $144,736.63
13 $27,364.20 $54,728.39 $82,092.59 $109,456.78 $136,820.98 $164,185.18
14 $30,872.82 $61,745.64 $92,618.46 $123,491.27 $154,364.09 $185,236.91
15 $34,670.66 $69,341.33 $104,011.99 $138,682.66 $173,353.32 $208,023.99
16 $38,781.57 $77,563.15 $116,344.72 $155,126.30 $193,907.87 $232,689.45
17 $43,231.36 $86,462.71 $129,694.07 $172,925.42 $216,156.78 $259,388.14
18 $48,047.94 $96,095.89 $144,143.83 $192,191.77 $240,239.71 $288,287.66

Again, there’s no right or wrong amount to contribute, and your child’s actual costs will vary based on where they matriculate and the amount they earn in scholarships and grants.

Set a target and maintain transparency with your child from the very beginning of the process about what kind of help you can offer — and what conditions you’re attaching to that help.


Alternative Model: Front-Loading Your Contributions

The more you can contribute early, the more you can lean on compounding. If you find yourself in a financial position to contribute more money in your child’s first years of life, you can ease off the contributions later.

For this exercise, I ran the numbers for monthly contributions for only the first six years of the child’s life. After that, you don’t invest another dime, and simply let the funds compound for the next 12 years.

Here’s how the balances look, both at age 6 when you stop contributing when they reach college age and you start withdrawing:

  • $100/Month: $9,247.98 at age 6; $23,925.18 at age 18
  • $200/Month: $18,495.96 at age 6; $47,850.35 at age 18
  • $300/Month: $27,743.94 at age 6; $71,775.53 at age 18
  • $400/Month: $36,991.91 at age 6; $95,700.67 at age 18
  • $500/Month: $46,239.89 at age 6; $119,625.85 at age 18
  • $600/Month: $55,487.87 at age 6; $143,551.03 at age 18
  • $700/Month: $64,735.85 at age 6; $167,476.20 at age 18
  • $800/Month: $73,983.83 at age 6; $191,401.38 at age 18
  • $900/Month: $83,231.81 at age 6; $215,326.55 at age 18
  • $1,000/Month: $92,479.78 at age 6; $239,251.70 at age 18

If you follow this strategy, make sure you have a backup plan for the funds in case your child decides not to go to college.


The “2 in 10” Rule

As a quick rule of thumb, Fidelity offers another shorthand to tell whether or not you’re on track.

The “2 in 10” Rule states that for every $10,000 per year of college help you want to offer, you multiply your child’s age by $2,000. That’s how much you should have saved at each age.

Consider a few examples. If you plan to offer $10,000 in tuition help per year of college, and your daughter is 13, then you multiply 13 by $2,000 to reach $26,000. So, if you have $26,000 saved, you can consider yourself on track.

Alternatively, say you plan to offer $20,000 in tuition help per year of college. For your 13-year-old, you again multiply 13 by $2,000 to reach $26,000, then double that because you plan to offer $20,000 per year (double $10,000). You should have $52,000 saved by age 13, in this case.

The earlier you start planning how much you want to help your children with tuition, the better you can plan for those numbers and stay on track.


Final Word

As you start thinking about how to pay for college, keep in mind most families cobble together the money from many sources. You do not have to foot the bill with savings alone.

According to Sallie Mae’s 2019 study “How America Pays for College,” the average American college student covers their costs through this combination of sources:

  • Grants and Scholarships: 31% of costs
  • Parent Income and Savings: 30%
  • Student Loans: 14%
  • Student Income and Savings: 13%
  • Loans Borrowed and Parents: 10%
  • Help from Other Family Members: 2%

Involve your child in the conversation about college costs several years before they actually start applying to schools. Set expectations with them early, and have them participate in the process of sourcing funds, particularly in applying for scholarships and grants. If you decide to give them financial help with the cost of college, incentivize them to reduce costs wherever they can.

Finally, make it crystal clear that your tuition help comes with strings attached. If they don’t perform by going to class and earning strong grades, they stop getting your help. You didn’t scrimp and save for decades to fund a four-year party.

Again, set expectations for these conditions in advance, and structure your help in a way that incentivizes their best effort.

Source: moneycrashers.com

5 Ways to Put an End to Junk Mail

Woman checking her mailbox
Joshua Resnick / Shutterstock.com

You might think junk mail would be a thing of the past by now. Alas, the volume of unsolicited mail still seems downright 20th century.

The good news is that there are steps you can take to stem its flow to your mailbox.

There is no single action you can take to halt all junk mail forever, but taking the following steps can drastically decrease the amount of unwanted mail that reaches your mailbox.

1. Stop prescreened offers

If you receive but don’t want preapproved offers for credit cards or insurance — also known as prescreened offers — visit OptOutPrescreen.com and opt out of these offers. The website is maintained by major credit-reporting companies.

The Fair Credit Reporting Act allows credit-reporting companies to share your information with lenders and insurers for the purpose of prescreened offers. But this federal law also gives you the right to opt out of prescreened offers, as we detail in “The Secret to Stopping Unwanted Credit Card Mail for Good.”

2. Opt out with your financial institutions

Federal law also allows financial companies like banks to share their customers’ information with certain third parties for specific purposes.

The Federal Deposit Insurance Corp. (FDIC) details this on its Money Smart website. Privacy notices that you should receive from your financial institutions at least annually also detail the institutions’ information-sharing practices as well as opt-out instructions.

Federal privacy laws give you the right to opt out of some but not all sharing of your information by financial companies, meaning you can limit the extent of that sharing.

The FDIC explains:

“These laws balance your right to privacy with financial companies’ need to provide information for normal business purposes. … [Y]ou cannot opt out and completely stop the flow of all your personal financial information.”

If you receive a privacy notice from a financial company, follow the opt-out directions on the notice. Otherwise, the FDIC notes that you can contact an institution and ask for instructions on how to opt out.

3. Fine-tune your direct mail

The Data & Marketing Association (DMA), a trade group formerly known as the Direct Marketing Association, maintains a consumer website called DMAchoice.org to help consumers manage the direct mail they receive.

According to the site, direct mail includes:

  • Credit offers
  • Catalogs
  • Magazine offers
  • Other mail offers

“You can request to start or stop receiving mail from an entire category or opt out from all,” the website says.

Registering with DMAchoice.org is not free, though. It entails a $2 processing fee.

Alternatively, you can register by mail, but you will have fewer options for customizing your direct mail and it’ll take longer. This route also will cost you more, $3, unless you include a printout of the online form.

4. Sign up with CatalogChoice

CatalogChoice is a nonprofit organization dedicated to reducing paper junk mail. It’s not affiliated with the mail marketing industry, according to its website.

To take advantage of CatalogChoice’s services, you have to register with its website, but the nonprofit aims to make the rest of the process easy. As its website explains:

“Gather the unwanted catalogs and other junk mail that clutter your home or office. Search for the sender, and submit the opt—out request. We’ll take it from there, acting on your behalf to complete your opt-outs while protecting your consumer rights.”

You can even go through CatalogChoice to cancel junk mail that’s being sent to previous occupants of your home.

5. Shield student education records

If you or anyone in your household is in school, request that the institution not disclose what’s known as “directory” information about you or the student in your household.

This information includes a student’s name, address and phone number, among other personal information. And federal law — specifically, the Family Educational Rights and Privacy Act (FERPA) — allows schools to disclose it without the student’s consent unless the student requests otherwise.

Note that FERPA applies to all schools that receive funds under certain U.S. Department of Education programs, according to the department. That includes colleges; I filled out a do-not-disclose form under FERPA the last time I took courses at a local university.

So, whatever institution you or anyone in your household attends, ask about its procedure for protecting the student’s directory information under FERPA. It can vary from one school to another.

The Education Department notes:

“[S]chools must tell parents and eligible students about directory information and allow parents and eligible students a reasonable amount of time to request that the school not disclose directory information about them. Schools must notify parents and eligible students annually of their rights under FERPA. The actual means of notification (special letter, inclusion in a PTA bulletin, student handbook, or newspaper article) is left to the discretion of each school.”

Disclosure: The information you read here is always objective. However, we sometimes receive compensation when you click links within our stories.

Source: moneytalksnews.com

Bogleheads 3 Fund Portfolio – Guide to Asset Allocations, Pros & Cons

Because investing is seldom taught in schools or talked about openly in social circles in the United States, most beginner investors are left to their own devices to learn how to pick individual stocks and bonds from articles and videos across the web and by making their own mistakes. But those mistakes can be quite costly.

Today, there are investment-grade funds that take much of the learning curve out of the equation. These index funds, mutual funds, and exchange-traded funds (ETFs) offer diversified groups of stocks chosen by some of Wall Street’s most well-respected experts.

Moreover, there have been several prebuilt portfolios designed to give investors, even beginners, the ability to invest successfully with little research. One of the most popular of these portfolios is known as the Bogleheads Three-Fund Portfolio.

What Is the Bogleheads Three-Fund Portfolio?

The Bogleheads Three-Fund Portfolio is one of the laziest among the so-called “lazy portfolio” category. As its name suggests, the portfolio is made up of only three investment-grade funds, making it one of the simplest portfolios you’ll ever come across in terms of setup and maintenance.

The concept is that by investing in three heavily diversified low-cost index funds — one focused on U.S. stocks, one focused on international stocks, and one focused on U.S. bonds — you’ll be able to build a portfolio that’s protected from volatility and gives you exposure to the returns the overall stock market has to provide.

The investment portfolio was developed by John C. Bogle, who goes by Jack Bogle. He’s the fund manager who became famous as the founder of Vanguard, an investment management company with more than $7 trillion in assets under management.

Bogle is also the founder of the popular investing forum Bogleheads.org, where investors discuss the principles Jack follows when making investment decisions. The forum is also where the three-fund portfolio first appeared.

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Portfolio Asset Allocation

This is one of the few prebuilt portfolios that doesn’t have an asset allocation set in stone. Instead, it’s more of a roadmap to building a portfolio that fits your unique needs. The portfolio consists of three key asset classes:

  • U.S. Stocks. For investors with a longer time horizon, the lion’s share of the portfolio is allocated to an index fund that’s centered around widespread exposure to the U.S. stock market. This could be a fund focused on the S&P 500 index, the Russell 3000 index, or any other index designed to track the performance of the U.S. stock market as a whole.
  • International Stocks. The next portion of your asset allocation will be to international stocks. To gain exposure to these assets, you’ll want to invest in a total international index fund with diversified holdings in both developed and emerging markets outside of the United States.
  • U.S. Bonds. Finally, the portfolio includes an investment in an index fund centered around U.S. bonds. This bond index fund should include a good mix of short-term, intermediate-term, and long-term bonds.

When it comes to how much money you should allocate to each of these assets, the decision is yours, but Jack Bogle suggests using your investing time horizon to guide you. The best way to do this is to use your age, with your current age representing your allocation to bonds and splitting the remainder between domestic and international stocks.

For example, if you’re 25 years old, you might put 25% of your portfolio into U.S. bonds and split the remaining assets evenly between U.S. stocks (37.5%) and international stocks (37.5%).


Isn’t Diversification Important?

Absolutely! Diversification helps you protect your investments from volatility. If this was a portfolio consisting of individual stocks and bonds, three assets wouldn’t be enough to properly diversify.

However, the portfolio is made up of three highly diversified index funds, each with hundreds or even thousands of stocks inside, which means that even with just three investment-grade funds, you’ll maintain a heavily diversified portfolio.

The Investment Thesis Behind the Portfolio

The idea behind the three-fund portfolio is to bring simplicity to the investing process while providing exposure to the wealth-building power of both the U.S. and the international stock market. Moreover, by mixing in a good helping of bonds into the equation, you’ll enjoy less risk.

As author of “The King of Bogleheads” and co-author of “The Bogleheads’ Guide to Investing” and “The Bogleheads’ Guide to the Three-Fund Portfolio,” Taylor Larimore points out that, although the portfolio is simple to set up and maintain, the thesis behind it is actually quite complex.

Larimore explains that when you use total market index funds, you’ll end up with a portfolio that includes more than 10,000 worldwide securities ranging in market caps and sectors. Moreover, due to the nature of the portfolio, it offers very low costs, both in terms of fees and tax efficiency.

Because this portfolio is based on broad-market index investing, there’s no style drift or overlap. This means there’s little risk of your investments drifting away from your intended investing strategy or overlapping other assets in your portfolio. And, with few funds to keep track of, it’s easy to rebalance.

Ultimately, the investment thesis is to take the most simplistic approach to significant diversification and asset exposure by essentially becoming the market.


How to Duplicate the Bogleheads Three-Fund Portfolio

Because it consists of only three broad-market index funds, the Bogleheads Three-Fund Portfolio is easy to replicate in your own brokerage account using low-cost ETFs.

Keep in mind that the assets suggested below are not set in stone. The strategy calls for diversification in U.S. stocks, international stocks, and bonds, but the exact funds you decide to invest in are your choice. For the purpose of this example, the portfolios outlined below are the most diversified options with total stock market index assets.

Moreover, as with any portfolio, the three-fund portfolio can be customized to fit your needs. You’ll find examples of the portfolio below both for investors who like to invest in international assets, which is the traditional way to build this portfolio, and for those who prefer to keep their investments domestic.

The Traditional Three-Fund Portfolio

The traditional Bogleheads Three-Fund Portfolio is relatively straightforward and can be built using the following funds:

  • Vanguard Total Stock Market Index Fund (VTSAX). The VTSAX was designed to provide exposure to the U.S. market as a whole. It’s made up of thousands of domestic stocks ranging in market caps and sectors. Moreover, you’ll gain access to both growth and value stocks through this fund, with an expense ratio of just 0.04%, which is among the lowest in the industry.
  • Vanguard Total International Stock Index Fund (VTIAX). The VTIAX is a diversified investment in stocks outside of the United States. It also invests in both value and growth stocks ranging in market caps and sectors. However, these stocks all represent international companies in both developed and emerging economies. With an expense ratio of 0.11%, the fees for the fund are slightly higher than what you’ll pay on the VTSAX fund, but they are still well below the industry average.
  • Vanguard Total Bond Market Index Fund (VBTLX). Finally, the traditional portfolio includes a bond fund like VBTLX, a diversified portfolio containing U.S. debt instruments including Treasury investments, mortgage-backed securities, and other bonds. Not only are the types of bonds heavily diversified, but maturities are too, ranging from short-term to long-term.

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Domestic-Only Investors — Modified Three-Fund Portfolios

If you would rather focus on domestic-only investment portfolios, the three-fund portfolio can be modified to fit your needs. There are two compelling options when it comes to changing the international asset allocation in the portfolio to something domestic that offers a similar risk-reward profile. These include small-cap and real estate assets.

Option #1: Small-Cap Stocks

To take advantage of the portfolio with the small-cap approach, you’ll still want to invest in VTSAX and VBTLX, as in the traditional portfolio. However, instead of investing in VTIAX for international stocks, you would invest in the Vanguard Small-Cap Index Fund (VSMAX).

This fund is designed to give you widespread exposure to a wide range of small-cap stocks that represent U.S. companies in various sectors. The fund comes with an expense ratio of just 0.05%, which is well below the industry average.

Domestic small-cap stocks have a strong history of performing well compared to their large-cap counterparts because these smaller companies have plenty of room to grow within unsaturated markets, similar to many international stocks. On the other hand, the risk profile is also increased because these companies don’t have proven track records of performance, giving them a similar risk-versus-reward profile to international options.

Option #2: Real Estate Investment Trust (REITs)

If you’d like to take the real estate approach, you could fill the void left by removing international investments with the Vanguard Real Estate ETF (VNQ). This fund invests in real estate investment trusts (REITs) as well as companies that purchase office buildings, hotels, and other real estate. The expense ratio on the fund is 0.12%. While that’s the highest cost of any fund mentioned here, it is still well below the industry average of 0.44%.

REITs have been stellar return producers for some time now, but they also come with increased risk. After all, these trusts only make money when their real estate investments result in rental income. This is yet another area where the risk-versus-reward profile is quite similar to international stocks.


Maintain Balance in Your Portfolio

No matter how simple or complex your investment portfolio is, it’s important to maintain balance. After all, an investment strategy is only worth using if you follow it.

As a lazy portfolio, you don’t have to rebalance your investments weekly or even monthly when investing in the three-fund portfolio, but it is a good idea to go through and adjust your allocation on a quarterly basis.

When doing so, look at the three funds within your portfolio and make sure that the amounts of money allocated to each of them still fit with your strategy.

For example, if you’re 25 years old and you find that stocks have grown tremendously and bonds have lagged — leaving you with 42% U.S. stocks, 40% international stocks, and only 18% bonds — you might sell some U.S. stocks and international stocks and allocate those profits into more bonds. This would help to maintain the protection against volatility the portfolio was designed to provide.


Who Should Use the Bogleheads Three-Fund Portfolio?

There are few investment portfolios that are designed for everyone, but the three-fund portfolio model is just about as close as it gets, largely because the decisions of which funds to choose and how much money to allocate to each are left for you.

In fact, it’s easier to tell you who shouldn’t use this strategy than to give you the long list of people who should. If the following descriptions don’t sound like you, maybe this portfolio isn’t for you. Otherwise, you’ll be in good hands following the strategy outlined by the three-fund approach.

No Need to Beat the Market

This portfolio isn’t designed to beat the market. Instead, it’s designed to provide such widespread exposure that your portfolio mirrors overall market returns.

If you’re a risk-tolerant investor who’s willing to take a few chances in the pursuit of alpha, this isn’t the strategy you’ll want to follow. But if you are happy to accept the long-term market average return in exchange for less volatility and broad diversification, the three-fund portfolio has you covered.

No Desire to Pick or Manage Individual Investments

If you want to be in control of every move made within your investment portfolio, this strategy — or any other strategy that’s based on investing in funds — isn’t a strategy you should consider. Any time you invest in a fund, you’re giving control to the fund managers, not just in terms of which stocks you’ll be investing in, but in terms of voting rights based on share ownership.

Many investors, however, are happy to leave the stock picking to others and have no interest in voting on corporate policies the way individual shareholders can.


Pros and Cons of the Three-Fund Portfolio

As with any other investment portfolio, there are benefits and drawbacks to following the three-fund portfolio. Here are the pros and cons you should consider before investing based on this strategy:

Three-Fund Portfolio Pros

There are several advantages to the three-fund portfolio. The most significant of these include:

1. Heavy Diversification

Although there are only three funds included in the portfolio, all of these funds are heavily diversified, meaning your portfolio will include a wide variety of assets. That’s a huge advantage because the more diversified your portfolio is, the less exposure you have to volatility and significant losses should one or more asset classes perform poorly.

2. Low Cost

The portfolio is centered around investing in low-cost index funds like those offered by Vanguard, a fund manager that’s known for charging lower-than-average expenses on investments. Although investing will always come with cost, by keeping the expenses low, you’ll be able to hold onto more of your returns, which makes a huge difference in long-term portfolios.

3. A Simple Approach

This portfolio is a perfect option for investors of all levels of expertise. After all, the approach to investing used in this strategy is just about as simple as it gets, making it a great option for beginners who don’t quite know their way around the stock market yet or for seasoned investors who simply don’t have the time or inclination to follow more complex strategies.

Three-Fund Portfolio Cons

While there are plenty of reasons to consider investing with the three-fund portfolio, there are some drawbacks you should consider before you start. The most significant of these include:

1. A Lack of Control

The portfolio involves nesting your money in three index funds. This takes the control over what specific assets you hold completely out of your hands, leaving it up to the fund managers to decide what your money will be invested in and to make decisions on your behalf when shareholder votes arise.

2. No Chance of Beating the Market

Many investors are willing to take moderate or higher levels of risk for the potential to beat average market returns. The three-fund portfolio strategy simply won’t scratch that itch. The portfolio is designed to mirror overall market returns, meaning your chances of beating the market are slim to none.

3. One-for-the-Other Diversification

While the portfolio gives you heavy diversification, if you want to invest in all three among international stocks, small-cap stocks, and real estate, you would be straying too far away from the basics of this portfolio to call it a three-fund investment.

Nonetheless, the basic principles can still be used to modify the strategy a bit for your needs. For example, instead of splitting your stock allocation between U.S. and international stocks, you could create a five-fund portfolio in which your stock allocation is split between U.S. and international stocks as well as small-cap investments and real estate.


Final Word

All told, the three-fund portfolio is one of the most popular among beginner and intermediate investors alike, and for good reason. The portfolio provides a balance of risk and reward based on your time horizon while giving you exposure to the market as a whole.

While the portfolio is highly customizable and a great fit for most investors, it’s not a one-size-fits-all approach to investing. Moreover, before following the strategy, it’s best to do research to decide which funds are best suited to meet your investment objectives.

Source: moneycrashers.com