Welcome back to Money Made Easy, where we focus on simple ways to manage your finances and save money. In the latest installment of the series, CNBC Select Contributor and Financial Advisor Kristin O'Keeffe Merrick walks us through her best tips for rethinking how you manage your money in 2023.
Check out the full interview featured on TODAY in the video below and read on for some of Merrick's best strategies.
4 simple strategies to get 'free money'
Free money isn't just finding a $10 bill on the sidewalk or getting a birthday card from Grandma. Below are four easy money moves you can make to bank what is essentially "free money," according to Merrick.
1. Meet your employer's 401(k) match
Employer-sponsored 401(k)s often offer a company match for employees who contribute a certain amount to the retirement plan. For example, your company may promise to match up to 6% of your salary if you also contribute 6% into your 401(k) — basically doubling what you're able to put away for retirement.
"If you don't contribute to your 401(k), then your company does not match and then you miss out on that compensation," Merrick says.
And don't forget that your contributions to a 401(k) are tax-free, meaning they reduce how much you owe in taxes.
2. Maximize your credit card rewards
Credit card rewards programs let you earn cash-rewards (or other perks) on money you were going to spend anyway. For example, with a cash rewards credit card like the Wells Fargo Active Cash® Card, you can earn unlimited 2% cash rewards on purchases with no annual fee.
Wells Fargo Active Cash® Card
Rewards
Unlimited 2% cash rewards on purchases
Welcome bonus
Earn a $200 cash rewards bonus after spending $500 in purchases in the first 3 months
Annual fee
$0
Intro APR
0% intro APR for 15 months from account opening on purchases and qualifying balance transfers; balance transfers made within 120 days qualify for the intro rate
Regular APR
20.24%, 25.24%, or 29.99% Variable APR on purchases and balance transfers
Balance transfer fee
3% intro for 120 days from account opening then BT fee of up to 5%, min: $5
Foreign transaction fee
3%
Credit needed
Excellent/Good
See rates and fees, terms apply.
Rewards credit cards allow cardholders to earn everything from cash rewards to points and miles when they spend on the card. Those points and miles can then be redeemed to offset expenses on things like travel, while cash rewards can lower your credit card bill.
Plus, many of these cards offer a welcome bonus after opening a new account and meeting a minimum spending requirement. For example, the Active Cash Card comes with a welcome bonus of a $200 cash rewards after you spend $500 in purchases within three months.
Merrick adds one caveat with credit cards, and that is to understand what a card could provide for you and whether or not it actually suits your spending habits. You wouldn't want to get a gas rewards credit card if you barely drive, for example.
And the key to really maximizing your card's rewards is to make sure you pay off your balance in full and on time each month, otherwise the interest and late fees you would accrue eat away at anything you'd earn. "You should not be using credit cards for points if you carry large balances," Merrick warns.
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3. Open a new checking account with a welcome bonus
"There's a lot of incentives these days for opening new accounts — there's actually cash incentives," Merrick says. "If you're ready for a new checking account, a good time to switch to another bank is when doing so would give you some free money."
The accounts below are currently offering new customer bonuses:
Up to $400 bonus offer: PNC Virtual Wallet. Open and use a select new Virtual Wallet.
$300 bonus offer: Chase Total Checking®. Open a Chase Total Checking® account and make direct deposits totaling $500 or more within 90 days of coupon enrollment (offer ends 7/24/24).
Chase Total Checking®
Annual Percentage Yield (APY)
None
Minimum balance
$1,500 daily balance to avoid monthly maintenance fee
Monthly fee
$12, with options to waive
Free ATM network
More than 15,000 Chase ATMs
ATM fee reimbursement
None
Overdraft fee
$34
Mobile check deposit
Yes
Terms apply.
$100 bonus offer: Chase College Checking℠ account. Open a Chase College Checking account with qualifying transactions (offer ends 7/24/24).
Chase College Checking℠
Annual Percentage Yield (APY)
None
Minimum balance
$5,000 to waive monthly service fee
Monthly fee
$12 monthly service fee; no monthly service fee for up to 5 years if you're a student between the ages of 17 to 24 at account opening with proof of student status
Free ATM network
More than 15,000 Chase ATMs
ATM fee reimbursement
None
Overdraft fee
With Chase Overdraft Assist℠, Chase doesn't charge an Overdraft Fee if you're overdrawn by $50 or less at the end of the business day OR if you're overdrawn by more than $50 and you bring your account balance to overdrawn by $50 or less at the end of the next business day (you have until 11 PM ET, 8 PM PT, to make a deposit or transfer). Chase Overdraft Assist does not require enrollment and comes with eligible Chase checking accounts
Mobile check deposit
Yes
Terms apply.
4. Transfer your cash to a high-yield savings account
In this rising-rate environment, now is the time to open a high-yield savings account and earn more interest than you would in a traditional savings account. You're essentially collecting "free" money by parking your cash in a savings account — especially one with an above-average APY.
"I want you to think about, if you're sitting on cash, where it's sitting and if it's earning you money and then maybe being strategic about where that money's going to go," Merrick says.
Some of the top high-yield savings accounts, like the ones below, are currently offering 4% APY and higher. If you have idle cash sitting in a traditional savings or checking account, it's worth moving your money to take advantage of the highest interest rates we've seen in decades.
LendingClub High-Yield Savings
Annual Percentage Yield (APY)
5.00%
Minimum balance
No minimum balance requirement after $100.00 to open the account
Monthly fee
None
Maximum transactions
None
Excessive transactions fee
None
Overdraft fees
N/A
Offer checking account?
Yes
Offer ATM card?
Yes
Terms apply.
UFB Secure Savings
Annual Percentage Yield (APY)
Up to 5.25% APY on any savings balance; add a UFB Freedom Checking and meet checking account qualifications to get an additional up to 0.20% APY on savings
Minimum balance
$0, no minimum deposit or balance needed for savings
Fees
No monthly maintenance or service fees
Overdraft fee
Overdraft fees may be charged, according to the terms; overdraft protection available
ATM access
Free ATM card with unlimited withdrawals
Maximum transactions
6 per month; terms apply
Terms apply.
Read our UFB Secure Savings review.
Bask Interest Savings Account
Annual Percentage Yield (APY)
5.10% APY1
Minimum balance
None
Monthly fee
None
Maximum transactions
Up to 6 withdrawals or transfers per statement cycle
Excessive transactions fee
None
Overdraft fee
None
Offer checking account?
No
Offer ATM card?
No
Terms apply.
1Annual Percentage Yields (APY) and Interest Rates shown are offered on accounts accepted by Bask Bank and effective per the dates shown above, unless otherwise noted. Annual Percentage Yield is variable and subject to change at any time. No minimum balance requirement and no monthly service charge. Must fund within 15 business days of account opening.
Bottom line
Simple money moves like meeting your company's 401(k) match, earning rewards on your daily spending with a rewards credit card, opening a checking account with a welcome bonus and transferring your savings to a high-yield account can make your money work harder for you and give you "free" money for the things you were already doing.
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