Borrowing is just one way to leverage the equity in your home for cash. Another option is a home equity investment. Though this alternative carries its own set of risks, it may also offer advantages for homeowners who need cash fast and don't want to owe monthly payments. Hometap is just one company that will invest in your home's equity.

Find out if Hometap is right for you here in this complete Hometap review.

Pros & Cons

Who Is Hometap For?

House-Rich, Cash-Poor Homeowners

If you need cash, you can lean on your home's value and the equity you already have in it. Hometap doesn't approve all applications for investments, but if you have enough equity and your home's value is expected to go up, you probably have a pretty good chance.

Hometap requires you to have at least 25% equity to qualify.

People Who Want Cash Now

With Hometap, you can receive an investment of up to 30% of your home's value or $600,000 upfront in as little as three weeks after applying.

This isn't “debt-free cash” exactly, but you won't owe interest or monthly payments and can pay Hometap out of your earnings if/when you sell.

People Who Don't Want Monthly Repayments

A traditional home equity loan requires you to make monthly payments toward what you owe and charges an interest rate on top of that.

But since it's an investment, you won't make monthly payments or pay interest to Hometap, making this an attractive option for people who are planning to sell their homes in the future but can't afford to add another payment to their budget right now.

Who Is Hometap Not Ideal For?

New Homeowners

If you've just purchased your house, you probably won't be able to qualify for a home equity investment with Hometap unless you've built equity in your home quickly and have at least 25%.

People Who Aren't Sure About Selling

If you're not 100% certain you want to sell your home in the somewhat near future, Hometap probably isn't for you. Because to come up with the money, you might just end up taking out a loan anyway. In this case, consider borrowing options such as a home equity loan.

People in 43 U.S. States

As of April 2023, Hometap is only operating in seven states. These are:

• Massachusetts
• Michigan
• Minnesota
• Nevada
• Ohio
• South Carolina
• Utah

If you don't see your state on this list, Hometap won't be available to you yet.

How Does Hometap Work?

Hometap is not a lender but a home equity-sharing company or investor operating under the LLC Hometap Equity Partners. You tap into your equity for an immediate cash payout in exchange for a portion of that equity later on. The effective period is ten years.

If you qualify for an investment, you will enter into a home equity sharing agreement. Hometap will pay you a lump sum upfront and you will pay an agreed-upon percentage, calculated using your home value, within or at the end of the ten-year effective period.

This is important: Hometap is entitled to a percentage of your home's equity whether you sell your house or not.

To qualify for an investment, Hometap requires that you have at least 25% equity in your home. They will make an investment of up to 30% of your home's value (or a maximum of $600,000). Hometap invests in single-family houses and works with FICO scores above 500.

When you boil it down, there are three main steps to the process of getting a home equity investment from Hometap.

1. Apply – See if you qualify by taking the Fit Quiz and getting an investment estimate.
2. Finalize – Get your house appraised, sign the legal papers, and accept a final investment.
3. Settle – Repay Hometap when you sell your home or settle the investment early before the ten-year effective period ends.

Here's a deeper dive.

Apply for an Investment

Inquiry

To apply for an investment, you'll submit an Investment Inquiry through the site that asks basic questions about your house and your goals for the investment. This is called the Fit Quiz and it's just a preliminary application. We'll cover this in more detail next in the “Who Qualifies To Use Hometap?” section.

Investment Estimate

If Hometap decides your house might be worth investing in, they'll send an Investment Estimate. This might differ from the final offer but should give you a ballpark idea of where you might land.

This is also when you'll be connected with a Hometap Investment Manager, a dedicated specialist who will walk you through applying and answer your questions.

Application

Next, you'll submit your complete application. At this stage, you'll provide the requested documents from your home purchase and loan to Hometap and upload them to your account.

Investment Offer

Finally, Hometap will give you finalized Investment Details with your final investment offer. This is when you find out how much cash Hometap is actually willing to invest in your home.

Hometap's investment is calculated as a percentage of your home's value when you apply, and the amount you owe at the end of the effective period is calculated using the same percentage. So if you're following along, that means you could wind up paying Hometap more or even less than they paid you. This is a risk you — and Hometap — take. At this stage, Hometap will also send for a third-party appraisal.

Hometap will make a maximum investment of 30% or $600,000 (minimum of $15,000) but the amount they will pay for home equity depends on the value of your home and the market. You won't know what you're going to pay to Hometap until you're ready to settle the investment.

The entire process, from applying for an investment to receiving your cash disbursement, can take as little as three weeks if everything goes smoothly. You won't make a monthly payment or pay interest when you get a Hometap investment.

Hometap will set up a third-party appraisal once when considering your application and again when you decide to sell. There won't be any follow-up inspections to see what you've done with the house and Hometap won't ask you to do anything other than stay on top of your payments and maintain your home.

You'll let Hometap know if you're ready to sell or want to buy out the investment.

Renovation Adjustments

If you plan to make significant updates or improvements to your home and you expect these to affect its value, you should request a Renovation Adjustment from Hometap.

Renovation Adjustments can be made for certain updates that cost more than $25,000 in total. This allows homeowners to have their home value adjusted down to account for renovations and exclude these from their home's final value.

Hometap does not necessarily get a share of appreciation that takes place as a direct result of renovations. If you provide the necessary documentation to prove what you did and what it cost, you can get the percentage adjusted. But Renovation Adjustments are not guaranteed.

To request a Renovation Adjustment, you'll need receipts and pictures from any renovations you do and you'll need to provide these to Hometap within 90 days of completion.

Can You Borrow More After the Initial Investment?

If you need more money after finalizing your application and receiving your funds, you might be able to make that happen with an Investment Increase. But just because Hometap made an equity investment the first time around doesn't mean they will invest more.

They assess eligibility for Investment Increases on a case-by-case basis. Talk to your Investment Manager if you want to think about handing over more of your equity for cash.

Settling the Investment

You have ten years after accepting your final offer from Hometap to settle the investment.

If you sell your house within this timeframe, you can just give Hometap what you owe from the proceeds of the sale so you have no out-of-pocket costs. But if you want out of the agreement sooner and you don't want to sell, you'll have the buy out the investment. Hometap doesn't care how, just that you pay the amount equal to the home equity agreed upon.

Hometap makes money only when your home's value increases, so they're banking on this happening by the time you're ready to sell or settle. If your home decreases in value, you will still just owe Hometap the agreed-upon percentage, even if this is less than the cash you received upfront. But if your home's sale price is higher than what you paid or even what you expect, Hometap's share will be higher and they'll profit.

Here's a sample of what this could look like for a home estimated to be worth $275,000.

This example scenario was generated using Hometap's Home Equity Investment Calculator. You can use this to see how much home equity you might be able to access.

If you settle without selling your home, you'll pay a percentage based on your home's market value at the time of settlement. So if you decide to settle the investment three years after applying, Hometap will find out what your home's value is at that point with a third-party home appraisal.

Do You Need To Tell Hometap How You Use the Money?

No. Hometap won't helicopter over you to make sure you're growing their investment. There will be no random check-ins or appraisals.

As far as your obligations before settling the investment, you're just expected to stay on top of your mortgage payments and continue making all other insurance and tax payments you've been making as a homeowner.

You do not need to get Hometap's input on changes you want to make to your home or do anything to try to increase its value if you don't want to.

Who Qualifies To Use Hometap?

It's not in Hometap's best interest to just invest in any old home, so they're particular about which houses and homeowners they invest in. Here's more information on eligibility and the qualification process.

Fit Quiz

Before doing anything, you have to take a quiz to find out if you pre-qualify. This is called the Fit Quiz.

First, Hometap will ask if you own a home and where. This will immediately rule you out if you're in one of the 43 states Hometap hasn't yet expanded to. But if your state doesn't qualify and you're really interested, you can sign up to receive a notification if Hometap makes it to your neck of the woods.

The next question asks you about how you would use the Hometap investment. You're under no obligation to go through with any of the uses you indicate here — this is just preliminary.

Next, you'll indicate your ideal Hometap Investment amount by choosing a range between $15,000 and $600,000 and how long you plan to live in this home. The question is “Is this your forever home?” and the options are:

• Yes, I don't plan to move
• No, I plan to sell in 6-10 years
• No, I plan to sell in 1-5 years
• I don't know

Then the quiz asks you if you're considering other options like home equity loans, HELOCs, reverse mortgages, refinances, personal loans, etc.

Finally, you'll provide some contact information, including your name, email address, and phone number. You need to do this to get to the next step, which is obtaining your results.

If you're approved, you'll be connected with a dedicated Investment Manager who will work with you to finalize your application.

Both homes and rental properties can qualify for investments.

Participating States

Hometap is still expanding its market. At the time of writing this, it only invests in seven U.S. states. These are:

• Massachusetts
• Michigan
• Minnesota
• Nevada
• Ohio
• South Carolina
• Utah

Credit Score Requirements

Hometap will consider your application if you have a credit score of at least 500, assuming everything else in your application looks good. But most clients have scores of 600 or more.

While traditional home equity loans will assess your interest rate using your credit and borrowing history, Hometap doesn't even do a hard credit check.

>>> Find out more: Best Credit Score Sites: How To Effectively Monitor Your Credit Score

Benefits of Hometap

No Monthly Payments or Interest

Unlike a home equity loan or home equity line of credit, you won't make monthly payments or pay an interest rate. You just pay Hometap at the end of the effective period — or 10 years after taking the investment — or settle early.

Easy Application Process

Seeing if you qualify for a Hometap Investment is fast and easy. Hometap only wants to see that your credit score is at least 500 and doesn't use your credit otherwise. They also won't pay attention to your debt-to-income ratio as this isn't a lending situation. Hometap is most interested in your home and its value, less in you.

And then won't leave you hanging when you apply — you'll know if you might qualify almost immediately. Plus, everything from the Fit Quiz to signing your final offer can be done online.

Dedicated Specialist

You'll be paired with a Hometap Investment Manager if approved who will be able to answer any questions you have about the process and guide you through setup. This is especially convenient if you want to make changes to an active investment such as increasing the amount or adjusting for renovations.

No Home Inspections

Hometap doesn't have any say in how you use their investment and doesn't play a role in the home sale process if you decide to move. All they require if you sell is that you try to get a fair market value for your home because that's what will be used to calculate the payout percentage.

Drawbacks to Hometap

No Set Repayment

Because the investment is based on a percentage of your home's future value, there's no telling exactly what you'll owe Hometap at the end of the investment period (whether you settle after selling or settle early).

You could end up paying Hometap a lot more than they paid you if the value of your home goes up, and this would come out of your profit. If you're counting on a big gain from the sale, it may be slashed after you pay Hometap.

But perhaps the scariest outcome is if you don't sell and your home's value increases substantially. At this point, you're not paying Hometap from what would otherwise be a profit, you're paying from your savings, a loan, a second mortgage, or whatever else.

>>> Find out more: How Much Does It Cost To Sell a Home?

No Flexibility

If you change your mind about selling your house after applying for Hometap, you don't have any options other than settling the investment. This is by whatever means necessary, even if that's a forced sale, taking out a second mortgage, or applying for a hefty personal loan.

Going the home equity investment route because you're cash poor only makes sense if you have a plan in place to change that.

Riskier Than a Traditional Home Equity Loan

With a Hometap investment, the expectation is generally that you're going to sell your home. If you don't, you still have to come up with the money to pay what you owe, even if this is more than the amount you received as a cash investment. For a lot of people, it will be, since Hometap only invests in homes it expects to appreciate.

TL;DR: If you chose Hometap to avoid taking out a loan, there's a chance you still have to.

Hometap's Pricing & Fees

Hometap doesn't charge interest and makes most of its money when you're home value increases and you pay them a portion of what you make on the sale.

That said, Hometap does charge a few fees. The biggest one is a fee equal to 3% of your investment for funding and arranging the transaction. This, along with the fees for appraisal, is deducted from your investment.

How To Contact Hometap

Before working with Hometap, you can live chat with a representative through the site. The chat will start with a bot, but you can request to be connected with an Investment Manager even if you haven't started working with Hometap yet.

You can also email or schedule a call with a representative from Hometap through the Contact Us page of the site. For questions about pre-qualifying or applying, email hello@hometap.com. For questions about active investments, email homeowners@hometap.com.

As a client, you can reach out to your Investment Manager at any time, whether you have a question about your investment, you want to increase your investment amount, you want to know more about settling early, or something else.

Hometap vs. Competitors

There aren't many companies doing exactly what Hometap is doing, but there are a handful of other home equity-sharing companies. Some of these are Point, Unison, and Unlock. We'll compare some similarities and differences between these options here.

Point

Like Hometap, Point lets you access the equity you have in your home with a home equity investment. They also have low credit requirements and don't require monthly payments, but Point differs from Hometap in that its terms are 30 years and homeowners can qualify with equity of 20% or more (versus 25%). Another difference is that you can rent out your home.

Point also offers SEED Down Payment Investments for those with good credit and operates in 25 states plus D.C. compared to Hometap's seven. Point will only invest up to $500,000 and charges a processing fee of 3%.

Learn more.

Unison

Unison is similar to Hometap in some ways but differs in the specifics. With this company, you will have up to 30 years to settle the investment and can use the money however you want. But the maximum investment is $500,000 or up to 17.5% of the value of your home and the minimum is $30,000. Unison will reduce the appraised value of your home by 5.0% as a Risk Adjustment and may make a Deferred Maintenance Adjustment if you neglect to carry out necessary upkeep and this affects your home's value.

Unison investments are not intended for rental properties. Unison is available in 29 states and D.C., making it the largest option available.

Learn more.

Unlock

Unlock is another Hometap competitor but with the lowest maximum investment at $300,000 (with a minimum of $30,000). For this company, the effective period is also ten years for most people. But the most important difference is that rather than completely buying out an investment all at once by selling or settling as you would with Hometap, you can do a partial buyout with Unlock to pay a little at a time. You can do this multiple times.

Unlock charges a 3.9% origination fee and may require you to repay some of your debt with the money they pay you. Overall, they're a little more restrictive but that partial buyout option is unique. Unlock operates in 15 states and does allow for rental property investments.

Learn more.

Is Hometap the Same as a Reverse Mortgage?

Hometap investments are not the same as reverse mortgages, though there are some similarities between the two. With a reverse mortgage, you borrow against your home's equity. The amount of the loan increases the longer you borrow, but you won't owe anything from month to month. You must use this home as your primary residence to qualify.

The biggest difference is that you're borrowing with a reverse mortgage and receiving regular payments. You won't owe money until you no longer occupy the home (and most borrowers repay the loan when they sell), and you will pay interest.

This option is exclusively for seniors over the age of 62, and you mostly see it being used by elderly customers who are planning to live out the rest of their lives in their homes.

Bottom Line

Hometap lets you access the equity in your home for an almost instant payout, but it's not without disadvantages. Be aware of the risks that come with investing in your home's future value and make sure you have a backup plan for buying out the investment if you choose this. Home equity loans are safer for those not sure about selling or without enough equity.

If you're comfortable with the risks, Hometap can be a good option for cash-strapped homeowners who would rather give up some home equity than make a monthly payment. Hopefully, this Hometap review helps you decide if you're a good candidate or if you should keep exploring other options for leveraging your home equity for cash.

Read More:

• 3 Benefits of Buying a Home When Interest Rates Are High
• Should You Pay Off Your Mortgage or Invest?

The post Hometap Review: 10-Year Home Equity Investments for Cash-Poor Homeowners appeared first on Investor Junkie.

There are a number of different money-making apps to choose from, from ones that pay you for shopping online to ones that help you save without even thinking about it. Some let you earn extra money while playing games, while others offer a great platform for finding freelance and contract work on the side. Point is, there's something for everybody.

Here are 19 of our favorite money-making apps for whatever kind of gig you're looking for.

Micro-Investing Apps

Micro-savings apps don’t guarantee that you’ll earn cash, but they do help you find some money to invest so you can try to turn it into more money. Acorns and Stash are two great options for saving and investing spare change.

Acorns

Visit Acorns

How to get paid: With Acorns, you can earn money by investing in stocks, bonds, or both. You’re not guaranteed to make money and probably won’t see growth right away. But if you leave your portfolio alone, it might grow and you’ll have the opportunity to sell and cash out.

Acorns was one of the first apps to help people invest their spare change with round-ups, or by rounding up transactions to the nearest dollar and investing the extra. For example, if you spent $14.84 on breakfast, the app would round the transaction up to $15 and drop the extra $0.16 right into your investing account. Now, the Acorns app lets you do a lot more, but if you’re just looking for an easy way to invest in the background with money you already have (and probably won’t miss), an Acorns Invest account is a good way to do it.

With Acorns, you invest in a portfolio of ETFs curated by experts and the platform automatically rebalances and reinvests dividends for you. Because there’s only a $5 minimum and Acorns is hands-off, this app is ideal for beginners. You can also earn money with Acorns Earn with bonus offers from over 15,000 different brands.

Read our full review.

>>> Find out more: The 6 Best Apps Like Acorns

Stash

Visit Stash Invest

How you get paid: You may earn money with Stash if your investment portfolio increases in value. You can withdraw your earnings at any time.

Like Acorns, Stash is a micro-investing app that finds investable cash for you by monitoring your transactions and automatically invests it. Stash offers stocks, ETFs, and even crypto and lets you either choose individual investments for yourself or use a Smart Portfolio to get the benefits of automated investing with hands-off diversification. You can also do a combination of both if you want to tweak an existing portfolio.

Stash and Acorns offer many of the same basic advantages and disadvantages but you may choose Stash over Acorns if you want a little more control over how you’re investing, want access to crypto, or you prefer an investment app that’s more hands-on. The Stash Stock-Back Card is a unique alternative to the average cash rewards credit card in that 1) it’s a rewards-earning debit card and 2) the reward is stock. You either earn stock in the company you’re shopping with, if it’s a partner, or in a company/ETF of your choice.

Read our full review.

Side Hustle Apps

Upwork, Fiverr, Doordash, Instacart, Task Rabbit, and Rover are money-making apps for those willing to put in more time and work for larger, more consistent payouts. These apps and websites show remote freelance and contract work as well as in-person jobs in your area.

Besides being another way to make some money, side hustle apps can also be great stepping stones if you're looking to transition into a different type of job or turn a hobby into something more. Who knows, maybe you should quit your day job.

Upwork

How you get paid: You may earn money on Upwork on an hourly basis, per project, or per milestone (project checkpoints). If per project or milestone, you’ll turn in your work by the due date and receive payment usually within two business days. Hourly projects use a weekly billing cycle. You can see whether a job pays a fixed or hourly rate in the description.

Upwork is a marketplace where freelancers can connect with people hiring for contract or part-time work. If you have a money-making skill and you want to start using it, Upwork could be the right app for you. This platform covers a wide range of fields and specialties from creative work like graphic design and writing to technical work like coding and data analysis. There are so many one-off and ongoing jobs to choose from. 

The biggest drawback to Upwork is the fees. You’ll start out paying 20% on everything and only reduce this to 10% or 5% after earning $500 or more for any given client. You’re also pretty reliant on client reviews to score higher-paying work, so you have to keep at it and build your portfolio if you want to turn this into something more profitable.

Learn more.

>>>Find out more: 9 Ways to Make Extra Money From Home

Fiverr

How you get paid: All Fiverr work is paid on a per-project basis, so you will receive payment after completing an order. You can transfer funds to a PayPal account, bank account, or Fiverr Revenue Card.

Fiverr is another freelance marketplace that covers a wide variety of services from design and site creation to voiceovers and translations. Fiverr differs from Upwork in that all work is fixed-price and project-based rather than a combination of this and hourly. So if you just want to grab some work here and there without committing to tracking hours, choose this platform.

Like Upwork, Fiverr places heavy emphasis on your client success. Your star rating is at the top of your freelancer card and you’ll be assigned one of four levels based on how many gigs you’ve completed and how much you’ve earned. You start at New Seller when you have less than seven gigs active and can work your way up to a Top Rated Seller if you’ve completed at least 100 orders. You might not necessarily make a quick buck with an app like this, but getting started could be a worthwhile investment.

Learn more.

DoorDash

How you get paid: You’ll earn a small base pay from DoorDash that’s based on the delivery duration, demand, and distance. You may also earn tips from customers, but these are never guaranteed. Payments are disbursed weekly.

If you have a decent car and you don’t mind driving – or a scooter and you don’t mind scooting –, you might be able to do the hungry people of the world a service and deliver them food in exchange for money via DoorDash. Ah, the gig economy. To qualify to become a DoorDash delivery driver, you need to be at least 18 years old, have a car or a bike/scooter that gets around, and verify your identity with your driver’s license and SSN. 

You can deliver on your own schedule, but you may have trouble finding jobs if you’re not checking the app at the right times. This varies a ton by area, so it might take a little while to get into the swing of things. The better your customer rating, the better your chances of qualifying for promotions. Do your best to go above and beyond by communicating with customers about issues and being friendly, and you’ll stay on DoorDash’s good side. 

Learn more.

Instacart

How you get paid: Instacart pays shoppers weekly whether they provide in-store shopping services or full-service shopping. Full-service shoppers earn per-order pay as well as tips and in-store shoppers earn hourly wages and choose shifts.

For those who know their local grocery stores like the back of their hands, becoming a shopper and delivery driver for Instacart makes sense. Instacart operates in all 50 U.S. states in every kind of place from small and mid-sized towns to metropolitan areas. You’ll choose orders based on your time, which stores you want to visit, and what you feel like doing.

When you apply, you’ll put in your location and wait to see if it’s been accepted. If Instacart needs more shoppers in your area, you’ll likely be approved. Full-service shopping is the way to go for a side hustle because you can choose the jobs you want and turn down the ones you don’t, plus you may earn tips. In-store shopping is paid hourly and requires you to take shifts. While still flexible and without minimums, this is a bit more of a commitment. 

Learn more.

TaskRabbit

TaskRabbit shows tasks people need help with and gives you a platform for marketing your handiness. This side hustle is extremely flexible and diverse, with over 50 different task categories to choose from. These include cleaning, car washing, delivery, errands, help moving, general assembly, minor home repairs, and so much more. Some tasks, like waiting in line for someone, don’t even require experience or qualifications.

You get to set your own hourly rates and you don’t have to worry about TaskRabbit taking a chunk of your earnings, which is really unusual for an app like this. To sign up, you’ll choose a category, pick your area, set your schedule, and verify your identity. That’s it.

Learn more.

Rover

Pros

• Flexible. Like many side hustle platforms, Rover lets you decide when you want to work and when you don’t, so you can easily fit gigs into your lifestyle.
• Set your own rates. Rover lets you choose your own hourly rate or fixed rate for every type of service you provide.
• Always hiring. Unlike other side hustle platforms for in-person services, Rover is always accepting new sitters.

How you get paid: Whether you earn money hourly or flat rate depends on the type of gigs you do. Jobs like house sitting and day care are charged hourly while drop-in visits and dog walks are charged per gig. You choose your rates for all services. Rover processes payments through Stripe and your funds will appear in your Rover Balance within two days of a completed job.

Love dogs and/or cats and also making money? Rover might be the perfect side hustle app for you. This niche platform is exclusively for providing people with pet care services including dog walking, boarding, house sitting and drop-ins, and day care. And not only do you get to pick your schedule, but you can also set pet preferences (e.g. no big dogs, cats, puppies, etc.). Rover is like Upwork or Fiverr. You create a profile, tell people about yourself, and set your rates.

Because you’re talking about people’s pets here, keep in mind that reviews really matter. If you do something to upset one of your clients, they can let everyone else know and this can bring your overall success score down, hurting your chances of landing future gigs.

Learn more.

Resale Apps

When you've got stuff to get rid of, it can be tempting to just toss it in the trash or pawn it off on a friend or family member. But you can often make extra money using apps meant for secondhand selling. If you have a lot of unwanted items lying around, install one of these.

OfferUp is a money-making app for selling just about anything, Decluttr is specifically for tech you're ready to get rid of, and Poshmark is mainly secondhand fashion-focused.

OfferUp

Pros

• No listing fees. There are no fees to list items or create an OfferUp account. You can optionally upgrade to the Promote Plus plan, but this really isn’t necessary.
• Hands off. After listing an item, you’ll just sit back and wait for the offers to come in. You don’t need to do anything else unless you decide to offer shipping. 
• More than selling. OfferUp has expanded to be much more than a peer-to-peer marketplace. There’s also a job listing platform within the app for open positions.

How you get paid: If selling locally, you’ll be paid directly by the purchaser using your payment method of choice, like cash, PayPal, Venmo, etc. If you ship, you’ll be paid via direct deposit.

Social media might do the trick when you’ve got something you want to get rid of and you want to make a buck, but apps like OfferUp are safer and more reliable overall. OfferUp is a peer-to-peer marketplace that lets you sell your unwanted items to people in your area for whatever price you set. You can also opt to ship items across the country and OfferUp will create the labels for you. Depending on what you’re selling, you can earn a lot more.

Unlike other selling marketplaces like Facebook Marketplace, OfferUp actually verifies people’s identities to help filter out bots and scammers. This makes it less frustrating to use and can help speed up the selling things that have got to go.

Learn more.

Decluttr

Pros

• Free. The Decluttr app is completely free to download and use, and instant valuation is offered free for everyone. You also won’t pay shipping fees to send your items in.
• Fast payment. Many users report receiving their payment. And since there are no auctions, you won’t have to wait for bidding wars to end.
• Instant valuation. You’ll get a free instant valuation for anything you’re interested in selling, so you’ll know right away if going through Decluttr is worth your time.

How you get paid: Decluttr pays users by direct deposit or PayPal. Most payments are processed on the same business day as your item successfully goes through a Quality Assessment, and you’ll get the funds between one and three business days after that.

If you’re one of those people who hangs onto your old smartphones and tech for dear life, Decluttr is the app for you. Decluttr is a platform for selling your old technology and electronics. You can sell phones, CDs and DVDs, gaming consoles, and more, even your unwanted books. But instead of being a marketplace like OfferUp, Decluttr is basically a mass purchaser of secondhand tech. It buys from you directly, refurbishes your item, and resells it through the platform. You can even get paid for damaged or faulty items.

There are a lot of benefits to using this platform including a Tech Price Promise that guarantees you’ll be locked into the first price offered for up to 28 days and instant valuation so you don’t have to wait around. You can shop or sell through Decluttr, or do both.

Learn more.

Poshmark

Pros

• Hands off. You don’t need to do anything after listing and describing an item until it’s time to ship it off to the buyer.
• More than clothes. Though geared toward clothing resale, you can use Poshmark to sell almost anything including electronics, home items, pet care items, and more.
• No shipping fees. Poshmark will send you a shipping label when you sell an item and complete a listing, paid for by the purchaser. 

How you get paid: After selling and shipping an item, the buyer will mark it received through the app. After that, you should receive payment minus service fees within three business days.

Poshmark is a social peer-to-peer marketplace for selling your clothes. The Poshmark app is completely free and it doesn’t cost anything to sign up for an account. This platform is mostly for designer, vintage, and popular styles but people use it for all sorts of brands and items. As long as you’re being honest about what you sell, you’re good.

To become a seller on Poshmark, you’ll just set up a free profile and start taking pictures of your items. You can use Poshmark as a one-and-done gig to get rid of that big pile of clothes you don’t need, or you can continually add listings to your shop and turn this into a side hustle, passive income situation. But if you go the second route, promotion is key. The more followers you have, the more reach.

Learn more.

Savings and Cash Back Apps

Cash back apps that help you save money are pretty much the definition of “work smarter, not harder.” These apps offer cash back rewards, savings, coupons, and more when you’re shopping online so you can pay yourself back with every purchase.

If you want to earn cash rewards by shopping, try Capital One Shopping, Rakuten, or Ibotta.

Capital One Shopping

Pros

• Free. There are absolutely no hidden fees to download or use the app, making this one of the only truly free money-making apps out there.
• Save money. This app compares offers to help you find the lowest prices for any particular item.
• Shopping Rewards. You may earn Shopping Rewards as a percentage of qualifying purchases or as a fixed rate.
• Available to everyone. You don't need a Capital One credit card or bank account to sign up for an account and use this app.

How you get paid: Most of the “pay” for this app is in the form of savings or money back. Capital One Shopping may give you Shopping Rewards for qualifying purchases made through the platform, which can be redeemed for gift cards. You’ll also “make money” by spending less and saving more.

If you love to shop, you’ll love Capital One Shopping. This is an app and browser extension that searches available discounts and promotions when you’re shopping and might also reward you. For example, if you’ve got your eye on a Shark vacuum and you use the app, you could save 20% on eligible products and get 3.5% back in Shopping Rewards. 

With this app, you can search for any brand or product and automatically apply available coupons/promo codes to your purchases. Capital One Shopping will do all of the comparison shopping for you to recommend the best retailer for whatever you're looking for. Shopping Rewards, if you get them, can be redeemed for gift cards. Next time you're online shopping, make sure you're doing it the right way.

Learn more.

Rakuten

Pros

• Free. Rakuten doesn’t cost a penny to use. It earns a commission when members use deals and links.
• Save money. Browse coupons from your favorite stores to save on the final price or take advantage of offers like free shipping; buy one, get one deals; etc.
• Cash back. Earn cash back when you shop at participating merchants and activate available offers.
• In store and online. Works when shopping online or in store.

How you get paid: Rakuten pays cash back on a quarterly basis and you can choose to receive your payment in the form of a PayPal transfer or paper check.

Rakuten is a free app and browser extension that finds savings for online purchases. It’s a lot like Capital One Shopping, except Rakuten offers more rewards while Capital One Shopping offers more coupons. You can also use Rakuten when shopping in person by using the app to link available offers, but Capital One Shopping is more automated.

There are over 3,500 participating stores in the Rakuten app, and this covers nearly every category of merchants and services. You’ll earn cash back on almost any coupon but you may need to use a code or go to a different site to activate a coupon. Overall, Rakuten is a great choice for earning cash back and everyday saving.

Learn more.

Ibotta

Pros

• Cash back. Shop from a variety of exclusive offers only available to Ibotta users at big brands.
• Online or in-store. You can earn cash back whether you’re using your phone to shop online or making purchases in person as long as you’re signed into the app.

How you get paid: You can withdraw your cash back earnings by transferring them to a linked PayPal account. Transfers are almost instant and you can initiate them at any time.

One of the most well-known cash back apps in the game, Ibotta is popular with people who can’t say no to a good deal. It’s an app and browser extension that includes exclusive offers from more than 1,500 brands to help you save and cash back to help you earn.

Like Capital One Shopping and Rakuten, Ibotta lets you browse by brand to find deals you might be interested in. An offer might be for a discount, cash back, or both. If you find one you like, just activate it when shopping online and complete the purchase. If shopping in person, activate the offer and scan the receipt when you’re done. 

Learn more.

Gaming and Survey Apps

You don't have to be a world-famous streamer to make money playing games.

Swagbucks, Survey Junkie, and MyPoints are the best money-making apps for people who want to earn money with games and other boredom-crushing activities.

Swagbucks

Pros

• Low cashouts. If you’re strapped for cash, you can withdraw as little as $1 from your Swagbucks account at a time or purchase a gift card. And there’s no waiting period.
• Multiple ways to earn. There are a lot of ways to make money with Swagbucks, including surveys, videos, and more.
• Free. You won’t pay any fees to sign up for and use Swagbucks.

How you get paid: You can cash out your Swagbucks as a PayPal transfer or use them to purchase gift cards at qualifying merchants. While gift cards have minimum cashout requirements, you can transfer to PayPal with just $1.

Swagbucks is an app that’ll pay you for doing almost nothing. If you’re killing time on your phone, you may be able to make money by watching videos, shopping online, downloading certain apps, taking surveys, and more. It’s up to you how you earn and how much time you spend doing it. Sometimes, you can even do activities in the background.

While you won't get rich with Swagbucks, you may be able to make a few bucks. You can qualify as long as you’re at least 13 years old and start using the app immediately.

Learn more.

Survey Junkie

Pros

• Easy. Surveys usually take around 15 minutes to complete and require very little effort.
• Free. You won’t have to pay to set up an account and Survey Junkie won’t take a portion of your earnings.
• Flexible. You take the surveys you want to take when you want to take them.

How you get paid: You can cash out your points for e-Giftcards or transfer them to your PayPal account as cash. You need to have at least $5 in rewards to cash out or 1,000 points.

Survey Junkie is, as you’ve probably already guessed, a survey app that pays you to answer questions. You’ll take surveys as part of market research carried out by DISCQO, a platform that compiles information about customer experiences for businesses.

If you like sharing your opinion about companies and products, this could be a fun and rewarding way to pass time. Taking surveys isn’t really going to be a source of passive income, if that’s what you’re looking for, but if you take a handful a day you might be able to cushion your budget a bit each week. You need to be 18 or older and verify your identity to join.

Learn more.

MyPoints

Pros

• Multiple ways to earn. With MyPoints, you can earn points by taking surveys, playing games, shopping, and more.
• Invitations. MyPoints will invite you to new surveys you might qualify for so you don’t have to waste your time trying to take ones you’re not eligible for.
• Daily deals. Check in daily to see special deals that can earn you more points.
• Free. MyPoints doesn’t cost anything to use.

How you get paid: You can redeem points in $5 increments for gift cards at 70 retailers, cash them out to your PayPal or Venmo account, or even transfer them to your United MileagePlus account to use them as travel rewards.

MyPoints is a free service where you can earn rewards by watching videos, playing games, scanning receipts, completing surveys, and even reading the spam emails you typically avoid. And often, you get a cash reward just for signing up with MyPoints. There are many ways to earn and sometimes offers come with additional benefits like free products to test.

If you’d rather make money buying things, MyPoints also partners with retailers so you can earn points on purchases when shopping through the portal. Overall, it’s a great app to have on your phone whether you want to earn money, save, or both.

Learn more.

Fitness Apps

Sweatcoin and Evidation are the best money-making apps for people who already exercise and want to earn extra cash while doing it, but this can also be a good idea for meeting your fitness goals.

Sweatcoin

Pros

• Free. The standard version of Sweatcoin costs nothing to use and the app is free.
• Data privacy. Sweatcoin won’t sell any of your data and all of your personal information will be kept completely private.

How you get paid: 1,000 steps are equal to 0.95 Sweatcoins, which are added to your Sweat Wallet. You can use these to redeem hundreds of different retail offers or donate to charities. To cash out, you will need to trade or sell your coins.

Do you use a fitness tracker? Download and sign up for Sweatcoin to turn your steps into rewards. You can earn Sweatcoins, a digital token, with every step and redeem them for purchases or charitable donations. Although you won't get a ton of rewards, Sweatcoin allows you to earn in the background by sharing information from activities you’re already doing. It’s a gamified fitness app to maximize your exercise while earning coins.

The more targets you reach and steps you take, the more Sweatcoins you’ll earn. You can convert Sweatcoins into SWEAT, a digital currency, if you want to invest in crypto.

Learn more.

Evidation

Pros

• Multiple ways to earn. Earn points for more than just exercising with surveys, research, and more.
• Multiple ways to redeem. Redeem your points for cash or charitable donations.
• Data privacy. Evidation gives you complete control over who can see your data and exactly what they can see.

How you get paid: You’ll earn $10 for every 10,000 points added to your account. If you’re feeling charitable, you can instead donate your earnings. Otherwise, you can redeem for a gift card or cash out as a PayPal transfer or pre-paid Visa card.

Evidation is a fitness and wellness app that rewards you for a variety of healthy activities. You can get points for exercising, walking, sleeping, weighing yourself, logging your eating, and more by linking your tracking apps with this one to import your everyday activity. Evidation incentivizes you to meet your goals with nudges, updates, and rewards.

While other fitness apps are focused on how much you exercise, Evidation offers other ways to earn that aren’t just about your movement. There are also surveys you can take and research studies you can participate in for extra points, if you qualify.

Learn more.

How To Choose the Right Money-Making App for You

So which of these apps should you start with? Here’s how to narrow them down.

Time Commitment

You’re not going to choose a time-consuming app for making money if you’re already exhausted all the time from your current job. If you only have a few minutes to spare at a time, try a passive income or selling app. But if you do have some extra time to spend, try a side hustle app or fitness app.

As a rule, you’ll earn more cash the more time and effort you put into these apps.

Fees

While most of these money-making apps are free to use, some have in-app purchases or paid plans. If you’re living paycheck to paycheck, an app that requires you to pay a subscription fee might not be the right choice for you right now. Just keep in mind that the truly fee-free apps also tend to offer the lowest payouts.

Redemption Options

Many apps for making money have limited redemption options because they’re partnered with particular payment platforms (say that five times fast). For example, several of these only let you use PayPal to transfer money. And while some apps let you cash out as soon as you have any earnings, others only pay out monthly or quarterly.

Check into not only how often you get paid but also how. And if a separate payment transfer app is required, decide if this is worth it.

App Usability

Finally, a money-making app is only useful if it’s actually usable. Read a handful of customer reviews in the Google Play store or IOS App Store to give yourself a better idea of what to expect in terms of functionality, reliability, and the overall user experience.

People are generally pretty honest when they’re unhappy with a product, so you should be able to get the information you need without doing much research.

Bottom Line

Money-making apps might not bump you into the next tax bracket, but they can help you earn a little extra cash on the side that you can turn into savings, invest, or use as spending money. The best part is there are so many different kinds of these apps out there that you’re sure to find at least one that works for you.

Whether you’ve got an hour to spare or a minute, give your bank account a boost with these 19 money-making apps.

Read More:

• Best Money Management Apps
• Net Worth Trackers: 7 Best Apps & Tracking Services

The post Best Money-Making Apps 2023 appeared first on Investor Junkie.

Automated tax-loss harvesting with the help of a robo-advisor is one of the easiest ways to take advantage of this money-smart, completely legal investing strategy.

Here, we'll talk about some of the best robo-advisors that offer tax-loss harvesting and give you tips for picking the right automated investment account.

Best Robo-Advisors With Tax-Loss Harvesting at a Glance

• Wealthfront – Best for Goals-Based Investing
• Betterment – Best for Beginners
• Empower – Best for Net Worth Tracking
• Schwab Intelligent Portfolios – Best Fee-Free
• Axos Invest – Best for Self-Directed Trading

Wealthfront — Best for Goals-Based Investing

Pros:

Cons:

Best For: Beginner and intermediate investors who will take advantage of goal-planning tools and progress-tracking features

Not Ideal For: Investors who want to hold fractional shares in an automated account

Fees: 0.25% advisory fee

Wealthfront does a lot of things right as a robo-advisor and stands out from the rest of the pack for its rigorous approach to figuring out and aligning with your financial goals. It's also one of the best for investors who want to customize their asset allocation or even create a portfolio from scratch. But you don't have to do this, as the curated portfolios are terrific. Choose the Classic Portfolio, Socially Responsible portfolio, or Direct Indexing portfolio.

If you're looking for a robo-advisor that will help you meet your goals while offering advanced benefits like tax-loss harvesting, Wealthfront could be a good fit. This is an excellent choice whether you're investing for the first time or have a few years behind you.

Read our full review.

Betterment — Best for Beginners

Pros:

Cons:

Best For: Beginners and investors who want to have less hands-on involvement

Not Ideal For: DIY investors who want to choose and manage their investments themselves

Fees: 0.25% annual management fee for most portfolios (or $4 a month), 1% for crypto portfolios (plus trading expenses)

Betterment is a solid robo-advisor all around, but we think beginners and investors who prefer to just sit back and leave their portfolios alone should appreciate it most. This robo-advisor makes it easy to get set up, customize your investing, and then relax. And with 12 different portfolios to pick from including stand-out options like social impact and climate impact portfolios, four different types of crypto portfolios, and many more traditional ones, you can feel like your investments are aligned with your priorities.

Don't choose Betterment if you want full control over your investments, but do choose this robo-advisor if you want to let automation do the heavy-lifting.

Read our full review.

Empower — Best for Net Worth Tracking

Personal Capital is now Empower

Pros:

Cons:

Best For: Investors with multiple retirement investment accounts who want complete wealth management support including human advisory services

Not Ideal For: Brand-new investors who have not started saving for retirement

Fees: 0.49% to 0.89% annual management fee

If you've started focusing on growing your net worth and you want a platform with financial planning features, Empower could be the robo-advisor for you. This robo-advisor emphasizes retirement investing and strategizing. And the Empower platform is more comprehensive than the average robo-advisor with tools for planning, budgeting, advising, and more. Plus, you can get human advising, which is less common for automated accounts.

Although beginner-friendly, Empower may not be the best option for those who have not started saving for retirement because many of its built-in tools — including a Retirement Planner, Fee Analyzer, Savings Planner, etc. — link with these accounts. To take advantage of Empower, you want to sync as many accounts as possible.

Read our article: “I've Used Empower for 9 Years: What I Love & What Could Improve“

>>> Find out more: Net Worth Trackers: 7 Best Apps & Tracking Services

Schwab Intelligent Portfolios — Best Fee-Free

Pros:

Cons:

Best For: Investors who want human advising and those looking to save on their investing

Not Ideal For: Investors looking for a highly-customizable robo-advisor, investors with less money to invest

Fees: No annual management fees, $300 setup fee and $30 a month after that for unlimited access to a certified financial planner (optional)

Schwab Intelligent Portfolios doesn't charge management fees, making it one of few robo-advisors that can be actually free. You can also pay for human advisory services from a CFP.

But there are some downsides to this inexpensive platform. First, a taxable investment account needs to have a balance of at least $50,000 to qualify for automated tax-loss harvesting with Schwab Intelligent Portfolios. This is higher than most robo-advisors. Also, there are only three different investment strategies available with Schwab — Global, U.S.-focused, and Income Focused — making this option more limited than others in terms of diversification too.

Read our full review.

Axos Invest — Best for Self-Directed Trading

Pros:

Cons:

Best For: Investors who want to take the reigns while customizing their portfolios to choose the assets they want

Not Ideal For: New investors who would prefer to have their portfolio built for them

Fees: 0.24% advisory fee

Axos Bank offers great Managed Portfolios for investors who want tax-loss harvesting at an even lower price point than some of its cheapest competitors, Betterment and Wealthfront. With a management fee of 0.24% and more than 30 different asset classes, plus the ability to choose those asset classes for yourself and their allocations, this option is well worth it.

In the background, Axos monitors your portfolio and sells your investments at losses while replacing them with similar investments to reduce your tax bill. And this platform comes with additional benefits like the option to exclude ETFs to avoid triggering the wash sale rule. There are no additional fees for tax-loss harvesting — this is included in your management fee.

Read our full review.

How To Choose a Robo-Advisor for Tax-Loss Harvesting

There are a lot of things to consider when choosing a robo-advisor. To help you get started, here are some of the most important features to pay attention to.

Fees

No robo-advisor is truly free. Though many of them have far fewer fees than the average financial advisor and brokerage account, they all charge various fees including annual fees and sometimes monthly fees. Look into account management fees while comparing your options.

>>> Find out more: The Actual Cost of Robo Advisors Fees — What Are the Annual Fees?

Investment Options

The point of a robo-advisor is that you don't have to manually pick your investments and rebalance your portfolio, but this works best when paired with a variety of investment options. Choose a platform that offers a combination of assets for better diversification.

If you're okay with just investing in ETFs, stocks, and bonds, most robo-advisors will work. But if you're interested in other assets like REITs and crypto, you have fewer choices.

Portfolio Types

Your precise asset allocation is going to be determined by your risk tolerance and how you answer setup questions when creating your account, but one of the biggest differences between robo-advisors is in their portfolios. No two platforms are exactly the same.

Think about your ideal investment portfolio when choosing a robo-advisor. Does it include a well-diversified mix of traditional investments? Stocks in socially responsible or sustainable companies? Shares of cutting-edge assets like digital currency or tokens? See which preset portfolios are available before signing up to invest.

Management

Most robo-advisors allow you to be completely hands-off with your investing and will do all of the rebalancing and reinvesting for you. Some investors like this while others want more control.

If you want to maintain some level of involvement, choose a robo-advisor that allows for self-direction. If you want to be involved as little as possible, choose one with great customization and automated features.

Minimums

All robo-advisors have different minimum deposit and balance requirements to keep an account. Choose one based on how much cash you have to invest. You'll see minimums of $0 for some while others require you to invest $10,000 or more to get started.

Returns

It's always smart to look into a robo-advisor's historic returns before signing up. Although you can't tell for sure how your portfolio may perform by looking at performance data, this is a good way to easily compare platforms. 

Advising

Some robo-advisors come with professional advisory services built into the cost or the option to purchase these. If this is important to you, go for a robo-advisor with more wealth management features.

Generally, companies either offer a robo-advisor alone (or mostly alone, like Betterment) or comprehensive investing services that can include a robo-advisor (like Schwab).

>>> Find out more: Understanding Financial Advisor Fees

What Is Tax-Loss Harvesting?

Tax-loss harvesting is a tax-efficient investing strategy that involves selling off assets at a loss with the purpose of reducing your current tax burden. By selling some investments at a loss rather than hanging on to them, you can offset your taxable gains from other investments and decrease your overall tax liability.

Investors may eventually buy back the same assets, replace them with similar options, or move on to other opportunities.

With tax-loss harvesting, you may be able to reduce your taxable income and lower your bill. Sometimes, this means a smaller capital gain to pay taxes on or even a net loss, depending on the rest of your portfolio's performance.

You can carry forward losses to an upcoming tax year if you exceed the maximum allowable net loss in any given year. In 2023, this is $3,000.

Note: Tax-loss harvesting defers taxes. You'll still need to pay taxes on any investments that lead to capital gains in the future.

Example

Say you have $20,000 invested in one ETF (we'll call it ETF A) and $15,000 invested in another (ETF B). ETF A has depreciated in value and is now worth $18,000 while ETF B has appreciated in value and is now worth $20,000.

ETF A: $20,000 —> $18,000 (-$2,000)
ETF B: $15,000 —> $20,000 (+$5,000)

If you were to only sell ETF B, you'd pay taxes on a realized capital gain of $5,000. But if you were to sell both ETFs, the $2,000 capital loss could help offset the $5,000 gain and you'd only pay taxes on a $3,000 capital gain. 

Long- and Short-Term Gains

You can offset long-term capital gains with long-term capital losses and short-term capital gains with short-term capital losses. Short-term gains result from sales of assets you held for less than a year and long-term gains result from sales of assets you held for at least a year.

Short-term capital gains are taxed at the same rate as your ordinary income and long-term gains are taxed at between 0% and 20%.

>>> Find out more: What Are the Capital Gains Tax Brackets?

Which Investments Qualify?

Tax-loss harvesting only works with taxable accounts. This means tax-advantaged investment accounts such as 401(k)s and IRAs aren't eligible. This makes sense if you think about it because these accounts already carry tax benefits — investments into a 401(k) reduce your taxable income and funds in an IRA grow tax-deferred.

Taxable accounts that can be eligible for tax-loss harvesting include brokerage accounts and robo-advisor investment accounts. You can apply tax-loss harvesting strategies to:

• ETFs
• Stocks
• Mutual funds
• Crypto

Limitations of Tax-Loss Harvesting

There will be times when tax-loss harvesting just doesn't work or make a lot of sense. And there's also a limit on how much you can save using this strategy.

For example, tax-loss harvesting doesn't make sense if you're going to spend more money executing the trades than you can possibly save. If you can't cut your tax bill by enough to easily make up for trading fees, don't do it.

It also isn't a good strategy for investors who have reason to believe they'll earn a higher income next year. If you get bumped into a higher tax bracket after using tax-loss harvesting, you could actually end up paying more taxes on your capital gains in the future. Yikes.

Also, you can only claim up to $3,000 per year in capital losses as a single individual or $1,500 per person if you're married.

Alternatives

There are other ways to reduce your capital gains tax burden besides harvesting losses. You can also decrease your tax liability by investing more for retirement, holding onto investments to defer taxes, and choosing dividend stocks to collect earnings without having to sell.

>>> Find out more: How to Offset Capital Gains Tax on Your Investments

Wash Sale Rule

You might be wondering: Can you buy an investment back after you've sold it at a loss to offset capital gains? The answer is yes. But you have to be aware of the wash sale rule.

The wash sale rule is a rule created by the IRS to prevent investors from being shady about cutting their tax bills by “gaming the system.” Basically, you're not supposed to sell an investment to reduce the capital gains taxes you owe and then turn around and buy almost the exact same investment right away. This is referred to as a wash sale and it's frowned upon.

A wash sale occurs when you sell an investment for a loss and purchase the same or a “substantially identical” investment within 30 days of the sale, before or after.

If you trigger the wash sale rule, you can't use the loss that triggered it to offset your gains.

So how do you avoid breaking this rule (and forfeiting the tax benefits)? Just wait long enough to replace investments. As long as you're outside of that 30-day window, you're fine. The best robo-advisors use safeguards to avoid wash sales.

Tax-loss harvesting itself is permitted by the IRS, but there is definitely a right way and a wrong way to do it. Do it right and you can save some money; no harm, no foul. Do it wrong and you won't get the tax savings.

Financial Advisors vs. Robo-Advisors vs. Neither: What's the Best Option?

You don't need a robo-advisor to use tax-loss harvesting investment strategies. There are ways to do this on your own and many traditional financial advisors assist with this.

But it's a lot easier and cheaper to have an algorithm to do it for you, and many robo-advisors have the capacity to do this more regularly than a human would.

A traditional financial advisor would likely tell you to wait until the end of the year or close to it to start tax-loss harvesting. This is because this is a good opportunity to rebalance your portfolio and you'll have a clear picture of your wins and losses for the tax year.

But robo-advisors generally apply tax-loss harvesting techniques daily or at least on a much more regular basis. It's easier and faster for an algorithm to find opportunities to harvest losses than for a person, and these platforms use automatic rebalancing to continually adjust your portfolio.

>>> Find out more: Robo Advisor vs. Financial Advisor

Bottom Line

Tax-loss harvesting can be a fantastic way to reduce your tax bill, but it can be a bit tricky and time-consuming to pull off on your own. Recruiting a robo-advisor to do this work for you is a worthwhile decision for most investors, especially since these platforms offer many other benefits too like lower fees, great diversification, and low-maintenance investing.

Check out one of these robo-advisors to start saving on your taxable investment accounts with regular tax-loss harvesting.

InvestorJunkie receives cash compensation from Wealthfront Advisers LLC (“Wealthfront Advisers”) for each new client that applies for a Wealthfront Automated Investing Account through our links. This creates an incentive that results in a material conflict of interest. InvestorJunkie is not a Wealthfront Advisers client, and this is a paid endorsement. More information is available via our links to Wealthfront Advisers.

Read More:

• 5 Ways Robo-Advisors Reduce the Cost of Investing
• The Best Robo-Advisors for LGBTQ+ Investors

The post 5 Best Robo-Advisors With Tax-Loss Harvesting appeared first on Investor Junkie.

reAlpha offers fractional ownership in investment properties, specifically short-term rentals, and uses AI-based tech to pass on savings and valuable analysis info to investors. It's a unique real estate investment platform that's friendly to beginners and fun and rewarding to be a part of.

Find out more about the benefits and drawbacks and if reAlpha is right for you.

Pros & Cons

Pros

• Lower minimum investment. You need $2,500 to start investing with reAlpha, which is lower than many other platforms.
• Beginner-friendly. reAlpha does not require accreditation or experience to get started, making it ideal for everyday investors new to real estate.
• Social. Prospective investors can openly discuss offerings in a forum to help give each other perspective. 

Cons

• Limited portfolio. As a relatively new company, reAlpha is a much smaller fish and doesn't offer many short-term rental properties to choose from.
• Confusing. There's a lack of clarity regarding details of investing with this platform, such as liquidity, projected revenue, exit options, etc.
• Quarterly dividends. Other platforms offer more frequent payouts than reAlpha.

Who Is reAlpha For?

Alternative Investors

If you're interested in alternative investments that aren't closely tied to the stock market, real estate can be a good asset class to get involved in. Like other alternative assets, real estate can offer advantages over more inflation-prone and volatile traditional investment classes. Compared to stocks, bonds, and mutual funds, real estate can give more stable returns.

reAlpha takes advantage of a growing vacation rental market. While this is definitely not the only way to invest in real estate, short-term rentals may offer higher yields.

>>> Find out more: The Best Real Estate Investing Sites for Non-Accredited Investors

Who Is reAlpha Not Ideal For?

REIT Investors

REITs or real estate investment trusts are investment vehicles made up of income-generating properties. When you invest in a REIT, you're essentially investing in an entire portfolio of properties along with other shareholders. It's kind of like holding stock in a company in that if the value of the properties in the trust goes up, so does the value of your share. 

If you prefer this to direct fractional ownership in particular properties, you'll want to look into adding REITs to your portfolio.

>>> Find out more: How to Invest in REITs: Should You Add Them to Your Portfolio?

Active Real Estate Investors

If you want to play a role in choosing properties and deciding what should be done with them, reAlpha isn’t for you. This platform takes management off your hands and makes all the decisions about renovations, upgrades, improvements, and sales.

What Is reAlpha?

reAlpha is an Ohio-based real estate investing platform founded in April 2021 with the goal of making real estate a more accessible asset class to the average investor. The company is doing this by lowering barriers to entry, such as investment minimums and management requirements, and using technology to efficiently vet and select properties.

From October 2021 to January 2022, reAlpha offered up to $75 million in common stock under Regulation A and was able to raise over $5 million, then over $9 million after being requalified as an active securities issuer by the Securities and Exchange Commission.

reAlpha has also entered into a joint venture with Singapore asset management firm SAIML Pte. Limited with the intent to invest up to $200 million in short-term rentals in California, Arizona, Florida, and Tennessee, but none of these have been purchased yet.

How Does reAlpha Work?

When you invest with reAlpha, all you really have to do is fund your account. reAlpha's platform takes care of the rest.

To choose properties with growth potential, reAlpha's AI algorithm, reAlphaBRAIN, scans thousands of properties available on the wholesale real estate market and assigns each of these properties a score using more than 28 different metrics. Here are a few examples of data points reAlphaBRAIN looks at:

• Purchase price relative to comparable properties in the area
• Miles to the nearest airport
• Number of attractions within a five-mile radius
• Etc.

As of March 2023, reAlpha has analyzed and scored nearly 500,000 properties using its machine-learning algorithm.

Only a select few short-term rental properties make it to the next step, which is analysis by a team of experts. This team carefully studies the advantages and disadvantages of any potential investment and decides which real estate deals are worth making. From there, reAlpha adds these offerings to its platform and compiles the necessary info about purchase price and so on.

reAlpha maintains up to 51% equity in each investment, but how much exactly depends on how many investors purchase shares. Each available property shows the total number of shares available, the target number of shares to be held by individual investors, and the number of shares funded so far. Whatever shares are left after the public has purchased what it's going to, reAlpha keeps.

You can see the potential range of reAlpha's Equity in the Offering Details for each property.

Once you sign up to invest with reAlpha, you’ll have access to all available offerings and can choose the ones you’re interested in adding to your portfolio by meeting the investment minimum for these.

reAlpha Features

reAlpha Marketplace

When you visit the reAlpha marketplace, you'll be able to see all investments currently available. Here's a sample of what one of these may look like.

Each listing is made up of the following sections:

• Investment Highlights — Lists stand-out features about a property that might give it advantages over other investments. 
• About the Property — Gives high-level property details about features that actual renters might be interested in.
• Market — Map of the area with notable destinations nearby.
• Market Data — Provides the average daily rate, occupancy rate, yearly revenue, and annual average appreciation for the area provided by a third party.
• Hosted by — Whichever property management company is responsible for overseeing and managing the property, along with their reviews and response rate.
• Amenities — Features included with the property (like what you'd read if you were searching for an AirBnB for yourself).
• Guest Reviews — Real reviews from guests.
• reAlpha BRAIN Score — A score out of 100 assigned by reAlphaBRAIN.
• Offering Details — Overview of the financials that shows the total cost of the project, the purchase price, the reAlpha Fee, and the range of reAlpha's equity.

For each property, you can view documents if you want to know more about the legal side of things or read the offering memorandum or offering statement.

reAlphaBRAIN

As mentioned, reAlphaBRAIN is the algorithm behind the whole platform. It does most of the pre-vetting to scout potential investments and give them overall scores. reAlphaBRAIN then passes off viable investment opportunities to the analysis team. 

This system maximizes the amount of time the team is able to spend putting together opportunities. Hopefully, this will translate to more offerings in the not-so-distant future.

reAlphaBRAIN puts together a score for each investment property. In the platform's own words:

In other words, this grade attempts to define how promising an investment is based on information currently available.

Quarterly payouts

Each quarter, you'll receive revenue from your investments calculated based on the total percentage of your share in the property. You can calculate your ownership percentage by dividing the total offering price by the price per share. This gives you the total number of shares for the property. Then, divide this by your number of shares to figure out your interest.

Benefits

Low Minimum

reAlpha requires an investment of just $2,500 to purchase partial ownership of a property. Compared to other real estate investing platforms, this is fairly low.

Vacation Booking

reAlpha has its own booking platform in the works that will give investors exclusive access to rental properties. We don’t know much about this yet, but this could be an intriguing addition to the platform and it’ll be unlike anything we’ve seen from competitors. 

Drawbacks

Risk

Real estate carries risks that other investments don't. These are not specific to this platform but still worth noting. reAlpha could also do better at laying these out and being more transparent about revenue expectations, cash flow projections, and exit options for investors.

>>> Find out more: What Are the Risks of Investing in Real Estate?

Hold Period

reAlpha expects investors to hold their investments for a minimum of five to 10 years. This is the same period expected by many competing platforms, but it still might be longer than an everyday investor wants to commit to.

reAlpha's Pricing & Fees

reAlpha charges a handful of fees to cover property scouting, purchasing, management, and sales. These are:

• Transaction fee: 2.5%
• Maintenance fee: 25% of revenue
• Disposition fee: 1%

How To Contact reAlpha

You can email reAlpha at support@realpha.com to get tech help or at invest@realpha.com to contact a representative from the investment team. The company is also pretty responsive in the forum below offerings.

Best Alternatives

reAlpha is not without competitors. Arrived Homes, Lofty.ai, and Fundrise are just a few other big names in the real estate space using a fractional ownership model.

Arrived Homes

Arrived Homes is another platform that allows users to invest in rental homes through fractional ownership of short-term vacation rentals. But unlike reAlpha, Arrived Homes only requires an investment of $100 to purchase shares. Both pay quarterly dividends and charge comparable fees, but Arrived Homes is older and therefore has a much greater selection at this time.

If you don’t have $2,500 to invest or want more options, consider Arrived Homes.

Read our full review.

Lofty.ai

Unlike both reAlpha and Arrived Homes, Lofty.ai purchases long-term rental properties. Lofty's minimum investment is just $50, even lower than Arrived Homes’. This platform also pays daily rent, so this might be a better option than reAlpha for investors who need more regular passive income.

Lofty.ai is probably better for more experienced investors because it offers trading features and is more hands-on overall.

Read our full review.

Fundrise

Fundrise has been investing in commercial real estate since 2010, so it’s much larger than the others here. But it’s also pretty different since you’re talking about a completely different market from short-term rentals, and these are REITs, not individual properties.

Fundrise requires $10 to get started. It offers a huge number of investments and strategies to choose from, with consistent and solid returns on its portfolio. It’s one of our most-recommended real estate investing platforms if you’re interested in REITs.

Read our full review.

Bottom Line

reAlpha is different from other platforms not only because it focuses on the short-term rental market but also because it leans heavily on AI to analyze and score properties. Hopefully, this will allow the company to scale and get to a place where there are more offerings available. Because right now, one of its biggest shortcomings is lack of opportunities. That said, one of its greatest strengths is accessibility and growth potential.

We're not sure where reAlpha is going from here, but it's clear there are many possibilities on the table for this growing company. We’ll certainly be keeping an eye on this promising platform.

Read More:

• Best Real Estate Crowdfunding Sites for 2023
• 9 Best Alternative Investment Platforms For 2023

The post reAlpha Review: Real Estate Investing for Short-Term Rentals appeared first on Investor Junkie.

We’ll go into the details of what happened over on Capitol Hill, but here’s the gist: Biden blocked efforts to repeal a retirement investing rule that allows fiduciaries to use ESG factors to choose investments. This means retirement fund managers can continue to include ESG considerations in the mix when sizing up investment opportunities.

Here’s what happened, how it happened, and why it matters for investors across the country.

What Is ESG?

ESG stands for Environmental, Social, and Governance. ESG investing is a type of investing that focuses on companies and corporations making efforts to address environmental, social, and governance issues and causes. This can include policies and standards, initiatives and projects, disclosures and research, and more.

ESG factors can be anything within these areas. Here are some examples.

Environmental factors include energy consumption, waste, and greenhouse gas emissions. 

Social factors include employee compensation, community involvement, and safety and quality standards.

Governance factors include corporate leadership, C-suite pay structures, and business ethics.

Choosing ESG investments involves the use of quantifiable metrics and often strict criteria. These metrics evaluate a company's performance from the perspective of sustainability. You can research companies yourself to learn about their behavior, use ESG scoring platforms to compare investments, or both. 

But just because a company has a high ESG rating doesn’t necessarily mean it’s more sustainable than another. Different platforms score businesses differently, and it's easy for companies to make claims about their standards that don't show the full picture. ESG investing comes with due diligence.

Retirement fund managers are legally obligated to consider the economical risks and rewards of each opportunity. The whole debate we’re about to get into is about whether or not ESG considerations are relevant.

If you’re curious about ethical investing, click the link below.

>>> Find out more: Demystifying Ethical Investing (ESG vs. SRI vs. Impact Investing)

What Led to the Veto

There’s quite a bit of history leading up to this veto, and it’s important to understand where it all started and how we ended up here.

The Rule

It all started with the Prudence and Loyalty in Selecting Plan Investments and Exercising Shareholder Rights Rule. Let’s call it the Prudence and Loyalty rule. 

Basically, this rule, created by the Department of Defense in 2022, puts language in place to permit fiduciaries to use ESG factors to help choose investments.

So?

In years past, fiduciaries were already using ESG-related information to make decisions about which investments would promise the best returns and lowest risk to their plan holders. But under the Trump administration, this became much more difficult. 

In 2020, the U.S. Department of Labor placed barriers on ESG investing by issuing a rule requiring pension and 401(k) fund managers to put pecuniary factors (those strictly related to money) ahead of nonpecuniary factors. ESG considerations were not to be included unless they were materially economic in nature.

And if fiduciaries were to make a choice between otherwise economically-equivalent investments that ultimately came down to a difference of nonpecuniary considerations (such as ESG), they would have to jump through extra hoops by extensively documenting these decisions.

The Biden administration issued the Prudence and Loyalty rule to reverse this plan. The final version of the new rule was released in November 2022, and it restored the ability of fiduciaries to make ESG considerations as needed to choose the best investments for their plan holders.

The Bill

On February 7, 2023, the Republican-led House Education and the Workforce committee proposed a bill (H. J. Res. 30) that would overturn the Prudence and Loyalty rule. This anti-ESG bill passed the House and then the Senate by a narrow margin.

But then it reached the president’s desk.

The Veto

President Biden stopped the bill in its tracks. Without his approval, the rule could not be reversed. The House attempted to override his veto but only achieved a 219-200 majority when they needed a two-thirds majority to trump it. 

He stated: 

This Controversy Is Not New

What’s this controversy Biden’s talking about? 

Republicans and Democrats have been debating the merits of ESG investing for years now. It’s a deeply partisan hot topic with at least two clear sides.

On one side, you have those who believe that allowing fiduciaries to use ESG factors is a political landmine. They feel that ESG investing pushes a liberal agenda and could allow fiduciaries to put political causes and social values over returns and performance. This side is in favor of overturning the Prudence and Loyalty rule.

On the other side, you have people who believe that allowing fiduciaries to use ESG factors is safer than not. They feel that, long-term, ESG investing is more likely to yield better returns for investors because it can account for outside risk factors, e.g. climate change and global warming, that could affect the market. This side is in favor of the Prudence and Loyalty rule.

You can see why it’s been so difficult for the government to put policies in place on the subject. 

With his veto, Biden is siding with the pro-ESG camp.

Reading Between the Lines

In the letter accompanying his veto, President Biden stated the following: 

The president is showing support for ESG investing, but his reasoning isn’t about values. He believes that not considering ESG factors would be risky to investors because these factors are likely to impact businesses.

Basically, ESG is about “outside factors” that matter to the economy. Climate change, environmental threats, social events and movements, and governance developments have a broader effect on the world. This, then, should be reflected in investment portfolios. If it weren’t, these portfolios would be influenced by changes but not protected against or prepared for them. 

Imagine a person knows it might rain and they decide to go on a walk. They can either pack an umbrella or take their chances, but they risk getting soaked. Pro-ESG investors take an umbrella.

Bottom Line

This veto is good news for supporters of ESG, but right now it’s impossible to say what it could mean for investing as a whole. 

We’re not sure what to expect from the Biden administration moving forward. But for now, this veto is important to be aware of. The debate will continue as lawmakers from both sides continue to address the topic.

Read More:

• ESG Investing Is About To Get Easier. Here’s Why.
• What's the Difference Between Ethical and Sustainable Investing? 

The post What Investors Should Know About Biden’s Veto appeared first on Investor Junkie.

The point of budgeting software is to help you make spending decisions and plan for the future. That's exactly what YNAB does.

Pros & Cons

What Is YNAB?

You Need a Budget (YNAB) is a budgeting app that allows you to plan your spending for the upcoming month, and then assign transactions to the various categories. This gives you a snapshot of exactly how much you have left to spend in each category as the month goes on.

It connects to your bank account and automatically pulls in your transactions from your linked accounts. You can easily categorize each transaction so your budget is always up to date.

You can also share access with a partner. So it's great for couples who want to stay on the same page.

The app offers not just the mechanics of monitoring income and expenses, but also provides instructional support to help you deal with the root causes of financial distress. It's an example of an app that does one thing and does it extremely well.

YNAB Features

How YNAB is Different: The Four Rules

YNAB is different than other budgeting software because it isn't about what has happened in the past. You don't just pull a report at the end of the month to see how you did. You actively plan and track throughout the month so you stay in control of your expenses.

How they are different really comes out in their four rules for budgeting:

Give Every Dollar a Job

Giving every dollar a job means putting each and every dollar into a budgeting category. So every time a dollar comes into your account, you'll assign it to a category. This is called “zero based budgeting”.

Then every dollar that is spent will also be assigned to a category.

This helps you stay on top of your spending and you'll always know exactly where you are and what you still have to spend.

Embrace Your True Expenses

Budgeting is more than just tracking your regular monthly expenses. One of YNAB's great features is how they use sinking funds. A sinking fund is a pile of money that you can add to and spend from as you go along. It's perfect for expenses that aren't exactly the same every month — like gift giving for example. You can figure out how much you spend each year for gifts and then budget 1/12th of that each month. As the year goes along you are funding your Gift budget but also spending as needed.

For example, here I've allocated $200 a month to gifts and you see how that works over three months.

In January, I allocated $200 to gifts and spent $56.15. Leaving me $143.85 left (in green), which rolled over into Feburary.

In February, I allocated another $200 to gifts and spent $270.08. Leaving me with $73.77 left, which rolled over into March.

In March, another $200 went to gifts but I didn't buy any. So $273.77 rolled over to April.

In April, I would allocate another $200 giving me a total of $473.77 to spend if I wanted to. As the year progresses, I'll be building up for a big lump sum to spend for Christmas, then we will start over again next year.

But this works with all kinds of expenses. Any categories you don't spend on an even month to month basis, like car repairs or medical expenses. Some months are more expensive than others so but if you can budget a flat amount each month you'll be able to absorb those bigger months without it impacting your whole budget.

Roll with the Punches

Rolling with the punches is YNAB's way of saying be flexible. YNAB makes it really easy to reallocate money as needed.

Let's say you budgeted $500 a month for groceries but you've spent it all and it's only the 20th. You know you'll need $100 to go grocery shopping at least one more time to make it through the month. With YNAB you can easily see if there is a category that has any left over funds that you can move into groceries.

Simply click on the green section and you'll get a drop down box where you can choose the amount you'd like to move an the category you'd like to move it to. Here I'm moving $100 from my Restaurant budget to groceries.

Of course, there are real life consequences to going over budget. If I needed that money for going to restaurants then I'll just be putting myself in a sticky spot later. But the longer you budget for the better you'll get at predicting your spending and the smoother your budget will get.

Note that you can see in this screenshot that I budgeted $250 for restaurants but actually had $322.21 to spend. This is because I was under budget last month and the excess rolled over. In this case I could move $100 into groceries without impacting my budget too much since I had extra in there. A benefit of being under budget that you don't get with other budgeting software. With YNAB you can really see how your everyday choices impact your finances.

Age your money

I personally think this rule is hardest to understand but it is the most impactful once you see it in action.

The idea is to stop living paycheck to paycheck by living on last month's income. When income hits your bank account you can allocate it to next month's budget. This means you start each month with a fully funded budget.

This stops the paycheck to paycheck cycle, no longer do you have to wait for your next paycheck to pay a bill or do that car repair.

If you've never had any flex in your budget it's difficult to imagine. But YNAB will help get you there though it's system. As you budget you'll be thinking ahead and using sinking funds to smooth out your budget. As you go along you will slowly get farther and farther ahead until you are a full month ahead in your budgeting.

YNAB Community

Budgeting with YNAB is probably unlike any type of budgeting you've done before. Therefore, getting started with this app isn't exactly easy. From a technical standpoint it's very easy to sign up and link your financial accounts — but it's likely a big mental shift from how you've budgeted in the past. So you might need some help.

I mean, I'm a budgeting nerd and I needed help.

Luckily, there is plenty of help. YNAB has an extensive help section on their website as well as a podcast and YouTube channel. There are also community driven groups on Facebook and Reddit.

YNAB has an extensive and active community. If you have questions there is no doubt someone who can help.

YNAB's Budgeting Features

Real-time Syncing

When you link your spending accounts, your budget will always be up to date across all devices, so you can access your budget anywhere, anytime.

If your co-workers invite you to lunch you can check the YNAB app and see where you stand.

For example, you've budgeted $200 for restaurants and see you've already spent $199 you may decide to skip. If you've spent $150, you may decide to go.

But it's also flexible. Let's say you've spent $199 of your restaurant budget… but you have $40 left over in gas and you have a full tank that will last you the rest of the month. You may decide to move some of that money out of gas and into restaurant so you join your friends.

Goal tracking

As you set up your budget you can set goals for different categories, such as saving for a vacation or paying off debt, and track your progress towards those goals.

When you set up a new budget category you have the option to set a goal. You have four goal options.

You can save up for a spending goal, like saving for a vacation. You can work to build up your savings account to a specific amount. You can just get a goal to save a certain amount each month. Or you can set a debt payoff amount.

This goal will be in your budget and available to you to allocate your income to when it hits your account.
Here I chose ” Savings Balance” and I can indicate how much I'd like to have saved and by what date. The system will automatically set the monthly amount needed to reach that goal and it will appear as a line in my budget.

Expense Tracking

Deciding how you want to spend your money is half of budgeting. The other half is making sure your money is actually spent according to the plan. YNAB helps you track your expenses and categorize them to see where your money is going.

It's quite easy to do and take me about 10 mins a week to categorize all my expenses. Most come through already categorized and I just have to approve them.

Here's what that looks like:

You can see the top one is bold, that one needs approval. It wasn't automatically categorized so I'll just click on that yellow highlight and choose which category it belongs in.

There is also a place to write notes, which is super handy. If I don't know what something is I can leave a note for my husband. Or if you want to keep track of different payments you can make notes to yourself for future reference.

You can also split transactions. So say you spent $40 on Amazon and $10 was groceries and $30 was household items. You can split that right on the transaction screen.

Reports

I will say that I don't use the reporting section of YNAB, and therefore my accounts are not set up to be very friendly for reporting.

Here's my spending reports for the first three months of 2023.

Obviously, I have the numbers blurred. However, even with the numbers it's not especially helpful or interesting.

How you set up YNAB will affect these reports, I'm sure if I wanted to see more in the reports I could do a better job of setting it up so I get the information I want.

For example, I only break my transactions up into “Bills”, “Spending”, “Savings” and “Other”. Under the bills section I have a subcategory for each bill, such as AT&T and Netflix. My spending subcategories are things like Groceries and Gas.

If you wanted more detailed reports you could break it up further by creating smaller categories such as “Transportation” or “Food” and you'd have more detailed reports.

If reporting is important for you, think about that as you are setting up your budgeting categories.

YNAB Subscription Pricing

YNAB is not free and it's actually on the expensive side when it comes to budgeting apps.

YNAB is $14.99 per month if you pay monthly. Or $99 per year if you pay annually.

They do offer a 34-day free trial to help you decide if you like the service. They won't collect your credit card information during the free trial because, in their words, “It's lame when companies do that.”

Is YNAB Worth It?

I absolutely think YNAB is worth it, after all, I use it myself. The average user saves $6,000 in the first year of using YNAB. So I'm not the only one getting a lot of value out of this budgeting app.

How to Set up Your YNAB Account

YNAB is easy to set up, but hard to use at first. Once you are set up and going along you'll see how easy it is. But because it's unlike any budgeting you've done before there is a bit of a learning curve.

Sign up

They offer a 34 day free trial and do not require you to enter a credit card to try it out. So it's totally risk free. If you decide that YNAB is not for you there is nothing for you to do. No need to cancel.

To get started, go to the YNAB website and click “Start Your Free Trial” in the top right of the screen. A pop up will appear for you to enter your email and create a password.

Once you do that, you'll have agree to their terms of service.

Next, you'll jump right into building your budget.

It starts with some basic default budget categories and subcategories. Start filling out some of the things you spend money on. You don't have to think of every single thing right now. Just add a few basic items to get the hang of adding categories. You have plenty of time to make adjustments later.

This is fully customizable so feel free to make it your own. However you want to set it up is great.

Here's a tip: If it's the middle of the month only budget what you will spend in this calendar month going forward. When you start a fresh month you can start thinking about the whole month. I started in the middle of the month and I was very confused for the first few weeks.

Once you've added a few spending categories you can link your bank accounts.

You can add your accounts by click on “Add Account” in the top left.

Add any accounts you use for spending, which will include checking accounts, credit cards, etc. However, I would avoid adding savings accounts.

I added a savings account when I first started and when I moved money into savings it wasn't behaving how I expected. YNAB treats all accounts as spending accounts, so it was still saying I had the money to spend, even after I had moved it to savings.

Once I removed my savings account things made a lot more sense. I could move money into savings and it would show that that money had been removed from my budget, which is what I intended.

You can also set up “Asset Accounts” which work differently than spending accounts. Here is where you can track your balances of your savings and investment accounts.

You can also add “Debt Accounts” where you can track your debt balances. I haven't added either of these types of accounts. YNAB is a budgeting app at it's heart and I've chosen to use it as such and track my savings and debt balances in other places.

If you aren't sure how you'd like to use YNAB I'd leave these off for now and add them later if you choose to. Keep it simple while you are learning how to use YNAB.

After you've linked your accounts your current balances will be ready to assign to your budget. In this example, I added a checking account that has $2,000 ready for me to assign.

Keep in mind, you can only assign what is actually in your account and you'll be working on a calendar month basis. So assign spending categories based on how you will be spending your money for the rest of this calendar month.

Here I've assigned all $2,000 based on my planned spending for the rest of this month.

Then you are ready to start categorizing transactions as they come in and working your plan.

Tips for Success with YNAB

Commit to Three Months

This is true for any new budgeting system. It takes a while to work out the kinks. So if you are new to YNAB, or to budgeting in general, it's going to take a few tries before you feel like you know what you are doing.

Don't let a bumpy first month make you feel like you can't budget. It just takes time to learn this new skill. I've never met anyone who gets right immediately.

I've been budgeting my whole adult life and it wasn't until my fourth month that I felt like I was confident in my YNAB skills.

Ask for Help

Again with the theme that there is a steep learning curve here. Don't be afraid to ask for help. You'll have questions, everyone does. That's ok. Join a YNAB community group on Facebook or Reddit. Or contact YNAB customer support and ask away.

YNAB has a committed user base. You are bound to get your questions answered. And you might pick up some budgeting hacks you hadn't considered before.

Keep it Simple

When you are first starting, I recommend using broader categories and then breaking them later if you find you need to. That way you can start to get the hang of YNAB without worrying about whether buying laundry detergent counts and groceries or not.

If you find you are overspending a lot in a category then you can break that down further to try to identify the issue.

For example, if you have a general “Food” category that you keep exceeding, then break it down into groceries and restaurants. You might find out you are eating out more than you realized. Or you might realize you buy a lot of groceries that you just end up throwing away because you are too tired to cook.

Budget in Some Slack

I have a category called “Buffer”. I've seen other users call it “Stuff I forgot to budget for”. You'll never have a perfect month of budgeting where there are no surprises, no overages, no mistakes.

As you figure out your spending habits you'll start to get an idea of how much slack you need in your budget. Just plan for that unexpected expense and then it won't be so stressful.

YNAB Alternatives

You Need a Budget certainly isn't for everyone. If you want more reporting, forecasting, or investment and net worth tracking then you may be looking for a different service.

Here are some other budgeting apps.

Simplifi

It has a lot of similarities with YNAB in that it allows you to set up your monthly budget and link your bank accounts so you can easily categorize your transactions.

It also has deeper reporting features than YNAB. It also offers more options for tracking your investments and net worth.

It costs $5.99 if you pay monthly or $35.88 annually.

Check out our full Simplifi review.

Pocketsmith

Users also report loving how it shows all your bills in a calendar view so you can always see what exactly is coming up. It's a very forward thinking budgeting tool.

Pocketsmith has a free plan if you want to check it out and see how you like it – however you can't link your bank accounts on the free plan.

There are two levels of paid plans, Premium and Super.

Premium costs $9.95 per month if you pay monthly or $90 per year if you pay annually. You'll get 10 year forecasting with this plan.

Super costs $19.95 if you pay per month or $169.92 if pay annually. You'll get 30 years of forecasting with this plan.

Check out our full Pocketsmith review.

Summary

Hopefully this YNAB review helped you decide if this is the budgeting app for you. If you are ready to truly take control of your money then YNAB is definitely worth a try.

It's biggest strength how the budget categories roll over from month to month. This allows it to handle expenses that don't happen every single month really well. You can't forget to plan for them and when they do pop up you don't have to scramble. It's biggest strength how the budget categories roll over from month to month. This allows it to handle expenses that don't happen every single month really well. You can't forget to plan for them and when they do pop up you don't have to scramble.

The post YNAB Review 2023 appeared first on Investor Junkie.

Now that tax season is upon us, it’s time to figure out how you’re going to fill out your tax return accurately — and with a minimum of fuss.

Using tax preparation software can help you navigate your tax return without spending hours trying to make sense of various forms and their accompanying instructions. Even if it costs you money, using H&R Block tax software (and other programs) can be worth it. Here’s a look at what H&R Block has to offer.

What Is H&R Block?

H&R Block is well-known for its in-person tax preparation services. You can go in and sit with a human and have someone help you with your taxes. It costs money to make an appointment, but for some consumers, it’s comforting to sit down with someone.

If you want to do your taxes on your own, with some guidance from software, H&R Block offers that option as well. H&R Block’s online tax software options provide you with a way to file your taxes from the comfort of your own home. Plus, if you decide you want to talk to someone, you can make that happen, since the company offers extensive customer support.

Who Is H&R Block Good For?

H&R Block online is a solid offering, competing well with TurboTax. For those with a little more confidence, something with fewer features, such as TaxSlayer or TaxAct, might be a good choice.

Additionally, if you have relatively straightforward taxes, Cash App Taxes offers a free product that includes some business aspects.

If you think you’ll need someone available to answer questions, H&R Block is a good choice. It’s a full-service option for those who think they’ll need some hand-holding. Plus, it’s ideal for those who worry that they may have to visit with someone in person at some point.

H&R Block Features

H&R Block Plans and Pricing

H&R Block supports DIY filing with online plans or downloads, filing with professional support, and full preparation services. Prices vary depending on your service tier and add-ons.

But it’s important to understand that pricing changes frequently for tax prep software, including H&R Block. However, H&R Block offers upfront price transparency so you know what you’ll pay when filing.

Online Services

Here are some basic features you can expect when you use H&R Block online:

• PDF uploading for past returns (including from TurboTax)
• W-2 photo capture from your phone
• Real-time refund tracking
• Extensive resource center including checklists, calculators, and more
• Access to paid live tax support (can add at any time when filing) 
• Access to audit support (for a fee)

Different products come with different levels of complexity, so what you choose depends on your tax situation. The four online filing plans are Free Online, Deluxe, Premium, and Self-Employed.

Free Online

Federal return: $0

State return: $0

Those with uncomplicated tax situations who meet certain requirements can file a tax return free using the H&R Block Free Online plan. This plan is for W-2, retirement, or unemployment income and lets you take both the Earned Income Credit and the Child Tax Credit. And unlike other platforms, H&R Block also lets you take deductions for tuition and student loans in the free plan. You can file your state return at no cost with this plan.

If you can qualify for it, go with this option.

Deluxe

Federal return: starting at $35

State return: $37 per state filed

If you plan to itemize your deductions, you’ll need to start with at least the H&R Block Deluxe plan. This version can support real estate taxes, mortgage interest, HSA advantages, and much more. This plan and all those above it come with DeductionPro, a dedicated program for totaling up and deducting your charitable donations. It automatically enters this information into your return. Also included with Deluxe and better is live tech support via phone and chat.

The Deluxe plan is ideal for those who own a home or have children and itemizing.

Premium Online

Federal return: starting at $55

State return: $37 per state filed

In addition to the features that come with the Deluxe version, the Premium H&R Block online tax plan comes with support and forms for investors. This includes Schedule E for rental property income and Schedule D for investment income and capital gains/losses. You can also report crypto transactions with this plan if you bought or sold any digital currency last year.

For investors, the Premium Online plan is the way to go.

>>>>Find out more: Paying Taxes on Investments 2023 Guide

Self-Employed

Federal return: starting at $85

State return: $37 per state filed

Finally, if you own a business or make any of your income from freelance or contract work, the H&R Block Self-Employed plan could be a good fit for you. You can import earnings from rideshares like Uber and easily report your business income. With this plan, you’ll be able to calculate self-employed deductions you might qualify for like the home office deduction, vehicle depreciation and expenses, and more. You can also use this plan to track business expenses. If you’re self-employed or just have tricky taxes, choose this plan.

Software Downloads

For those who prefer downloading the programs they need to do their taxes and filing themselves, here’s the information you need about software downloads from H&R Block. With all software options, you can file up to five federal returns. Note for all options that State e-file is not available in NH and e-File fees do not apply to NY state returns.

Basic

Federal return: $19.95

State return: $39.95 each per program, $19.95 each for state State e-file

This software is best for W-2 earners with very simple filing statuses. 

Deluxe + State

Federal return: $44.95

State return: $0 for first program return ($39.95 each after), $19.95 each for state State e-file

The Deluxe + State software includes one state return in the price. This option is ideal for itemizing and reporting investment income.

Premium

Federal return: $64.95

State return: $0 for first program return ($39.95 each after), $19.95 each for state State e-file

For reporting rental property and/or self-employed income, choose this download.

Premium & Business

Federal return: $79.95

State return: $0 for first program return ($39.95 each after), $19.95 each for state State e-file

If you own a business and need expense reporting features and support, the Premium & Business software is ideal.

How To Choose a Product

If you want to file yourself, choose the online plan or software download that will be able to support the type of income you earn, deductions you plan to take if itemizing, and the forms you need to file. For H&R Block, we recommend filing online since the platform is so simple to navigate.

Full preparation services are also an option with H&R Block, and they’re much more flexible than the average provider. You can either make an appointment to work with a tax pro at an H&R Block office or stay completely hands-off and drop off your documents at an office or upload them online. Pricing starts at $85 for all of these prep choices.

Guarantees

H&R Block backs its online plans with four different guarantees:

• Maximum Refund Guarantee – ensures you are made whole if an error in software or online tax preparation services made an impact with the option to amend at no charge
• Audit Support Guarantee – ensures free basic assistance with understanding audits
• Accuracy Guarantee – ensures 100% accuracy and reimbursement up to $10,000 for resulting penalties and interest charged as a result of online or software errors
• No Surprise Guarantee – ensures transparency about pricing and features

Tax Refund Options

H&R Block tax software offers some interesting options for receiving your refund. As expected, you can choose to receive direct deposit by providing your bank information. You can also opt for a paper check. But H&R Block also offers other interesting choices.

• Direct deposit
• Paper check
• Spruce – This is a mobile banking platform created by H&R Block that lets you receive your refund up to five days early
• Refund transfer – Have your filing fees deducted from your refund automatically

How to Sign Up

To get started, H&R Block asks a few questions to get to know your tax situation then recommends a product for you. Once you figure out which product to use, you can set up your account and start filing.

There’s a disclosure form you can choose to sign. You don’t have to in order to proceed, but it makes it harder for H&R Block to personalize your taxes if you don’t allow the disclosure.

Once you get through those steps, you can start working on your tax return. It’s fairly straightforward and you can start your taxes without providing credit card information.

Synchronization

One of the nice things about H&R Block is that you can start your return by uploading a PDF of your previous year’s Form 1040 to auto-import this into your return. This will speed up the process by reducing the time spent filling out basic info.

Mobile Accessibility

MyBlock is H&R Block’s mobile app. It lets you get expert help, upload and organize your tax documents, check your refund status, and more. You can even snap pictures of your tax forms like your W-2 for even easier importing. If you want, you can go back and forth between filing from the online platform and filing from your phone or choose one and stick with it to the end.

From our experience, H&R Block’s mobile app is one of the best out there.

Customer Service

H&R Block offers extensive customer support. You can get access to unlimited live chat support free (if you pay for at least the Deluxe online plan) or call and talk to a person with any plan or product. H&R Block also has an extensive online help center that answers basic questions and resources built into the filing platform to support you as you go.

Additionally, if you pay extra for professional help, you can share your screen to show an expert what you’re working on and ask specific questions about your taxes. 

Finally, if all else fails, you can visit an H&R Block office near you to get help.

H&R Block Pros & Cons

Pros

• Robust free filing. H&R Block's free file tier covers more forms and deductions than many of its top competitors including TurboTax.
• Pricing transparency. Even if you start filing one way and switch to another or add on more support, you’ll know exactly what you’re going to pay before paying it.
• Easy to navigate: H&R Block offers intuitive navigation that walks you through the process. Also, the ability to snap your information or upload previous returns can help reduce the time you spend dealing with your return.
• Professional support. You can pay for expert help or have a pro file completely for you.
• Audit support and assistance: Get help understanding your next steps if you’re audited by the IRS at no cost. You can also pay for Worry Free Audit Support.

Cons

• Higher prices. If you don’t qualify for free filing, H&R Block can get pricey, especially if you need more than just a few itemized deductions.
• Add-ons can increase the price. While audit support is a nice touch, you’ll pay for it. Plus, other add-ons can increase the price dramatically.

Not the best for multi-state filers. With H&R Block, each state return increases the price you pay. This is typical but still costly.

The post H&R Block Review 2023 appeared first on Investor Junkie.

You’ve probably seen the people dressed in Lady Liberty costumes, standing on sidewalks and pointing you toward Liberty Tax. The company has office locations across the country and is perhaps best known for its in-person tax prep services.

However, like many brick-and-mortar providers, Liberty Tax recognizes that many people really just want to be able to prepare and file their taxes online — without the hassle of going into an office. So for those who don’t like the idea of visiting an office to hand their taxes off to a pro, there are online plans and remote filing options too.

Here’s what you need to know about filing your taxes using Liberty Tax.

What Is Liberty Tax?

Liberty Tax opened its first offices in the United States in 1998 and since then has become a fixture at tax time. There are more than 3,000 branches in the U.S. and Canada.

While you might receive good, cost-efficient service by making an in-person appointment, the reality is that the DIY tax software offered by Liberty Tax might not be the best option. The interface is clunkier than many other online tax prep packages.

Most of the navigation is self-guided, so it’s not very intuitive for beginners. Seasoned filers shouldn’t have a problem, although they may prefer more appealing software.

However, if you've started your tax return online and grow frustrated with the experience, you can transfer your filing process to a Liberty Tax brick-and-mortar office for no extra fee.

Who Is Liberty Tax Good For?

For the most part, Liberty Tax's online software is best for those who are fairly confident filers and who don’t need a lot of hand-holding. The service can be good for experienced filers who know what they are doing and just want a little help going through their taxes in an orderly fashion — and don’t mind that they aren’t getting a great bargain.

At the same time, since there aren't a lot of options for filing, if you need some support but don’t want a professional to complete your returns for you, Liberty Tax isn’t right for you.

In many cases, other tax filing software is likely to be a better choice. For complicated taxes, TurboTax and H&R Block have better support and options as well as better customer service. Plus, with those companies, you can purchase audit defense products that aren’t available with Liberty Tax. For those who have simple taxes and want free options, just about every offering out there is a better choice — including Cash App Taxes, which is completely free at any level.

Unless you want to be able to go into an office if you get stuck, or for the double-check, there’s not much that Liberty Tax has to offer beyond what you can get for a better deal elsewhere.

Liberty Tax Online Features

Liberty Tax Plans and Pricing

Liberty offers the following tiers of service for online plans: Basic, Deluxe, and Premium. All of these are covered by a Maximum Refund Guarantee and Accuracy Guarantee. If you prepare your taxes with Liberty Tax and then file with another provider, Liberty Tax will refund you for preparation fees if you receive a bigger refund from the competitor. And if Liberty Tax’s services cause you to make an error, you’ll be reimbursed for any associated penalty and initial interest charges you may be responsible for.

It’s important to note that there is no free online offering with Liberty Tax. So you’ll have to look elsewhere if you have a very simple situation and want to file your taxes for free.

Online Services

Basic 

Federal return: $45.95

State return: $36.95

If you’re claiming the standard deduction and you have a W2, the Basic Liberty Tax online plan might be right for you. This plan allows you to report taxable employment income of less than $100,000 or unemployment income and supports Schedules A and B. It’s, you guessed it, basic.

This plan is ideal for students, individual filers, and married couples without kids.

Deluxe

Federal return: $65.95

State return: $36.95

If your tax situation is more complex or you’re an investor, you may need a step above Basic. The Deluxe online plan with Liberty Tax is designed for moderately-complicated returns that need to include things like itemized deductions and investment income. This plan also gives you access to more forms including Form 1040 Schedule C for business profit or losses. And if you own a home, the Deluxe version is the way to go so you can deduct mortgage interest.

This plan is ideal for families, investors, and homeowners.

Premium

Federal return: $85.95

State return: $36.95

The Premium online plan is recommended for people with freelance, contract, or other types of self-employment income as well as those who earn income from rental properties. With this plan, you can prepare Schedule K-1 forms and claim deductions for a variety of business expenses. This plan also allows for taxable incomes over $100,000 while the other two do not.

The Premium online plan is ideal for self-employed filers and side hustlers, rental property owners, and high-income earners.

Professional Preparation

If you don’t want to file your taxes yourself, you can enlist the help of a Liberty Tax expert by either visiting a Liberty Tax office location near you or uploading your tax documents to allow a professional to file for you remotely. From there, all you do is answer questions as needed. 

Liberty Tax states its offices and tax software will provide the most accurate return and the largest possible refund you are entitled to receive. This service is backed by an Accuracy Guarantee that ensures if there is an error in the preparation of your return that results in penalties or interest, then you will be reimbursed for the associated penalty and any initial interest.

Liberty Tax also offers Audit Assistance to people who have their taxes prepared by a pro in a local office. If you receive an IRS audit, an expert will come with you to the audit to help explain the details of your return. This service, including any potential charges, may vary depending on your situation and location – and is not readily advertised by the company – but may cost more than online filing plans.

How To Choose a Product

If you’re planning to go with Liberty Tax this tax season, decide first whether you want to file for yourself or pay someone to do it for you. Unlike other platforms such as TurboTax, you won’t have an in-between option that combines DIY filing with professional help for more support at a better value. 

Pick an online plan based on your tax situation. If your taxes are simple and you’ll be using Form 1040, Basic will cut it and save you money. If you invest and/or own a home, choose Deluxe. And if you have freelance and/or rental property income, choose Premium.

Refund Options

There aren’t any really stand-out tax refund options with Liberty Tax online tax prep software. You’ll have access to the standards:

• Direct deposit
• Paper check
• Netspend® Liberty Tax® Prepaid Mastercard®
• Refund Transfer via check, direct deposits, or Netspend® Liberty Tax® Prepaid Mastercard®

You can also get an advance loan on your tax refund, but we don’t recommend these due to their very high APRs and fees.

How To Sign Up

The initial form for signing up with Liberty Tax is a little longer than with other services. You provide your name, email address and phone number, as well as a password and security questions, all in one form.

Like other tax packages, you have to use a verification code to finish the setup. Liberty Tax emails your code, and once you enter it, you can select the option that allows you to start a new return. You can import from a competitor by choosing who prepared your taxes or upload files from your computer.

Once that’s done, you can move forward and start verifying information and filling in the rest of the forms.

Synchronization

It’s a nice touch that you can import your 1040 from the previous year. Additionally, there’s a great feature that seamlessly hands your tax return off to a local Liberty Tax office if you decide that you need in-person help.

Mobile Accessibility

The Liberty Tax mobile app is extremely simple compared to the competition. You can use it to upload your tax documents, get help from experts, and check your return status, but there’s not much you can do from your phone beyond that. 

This app doesn’t have as many calculators, resources, and discovery questions to uncover tax advantages as other providers, but it has functionality going for it. It’ll get the job done if you’re set on using your phone rather than the online platform.

Customer Service

There are a number of helpful articles explaining tax concepts, and you can access FAQs from the online tax prep interface. For the most part, these are helpful, although they aren’t offered as part of the flow when you’re filling out the form.

For customer service or tech support, you can send an email or chat with a representative through the webiste. You can also go into a local office to get support. There is also a phone line for general questions, and the number for that is 800-790-3863.

Pros & Cons

Pros

• Optional in-person filing. Those who appreciate hands-on help can make an appointment with a Liberty Tax pro to get their return filed.
• Guarantees. Accuracy Guarantee applies whether you’re filing yourself or having a professional do it for you.

Cons

• Higher prices. Liberty Tax online tax filing plans cost more, in some cases significantly, than many other providers. 
• No free version. Many DIY tax software platforms offer a free version for those with the simplest returns.
• No software downloads. Only online plans and full preparation services are available with Liberty Tax.
• Lack of transparency. Liberty Tax does not clearly advertise pricing for its full preparation services, virtual or in-person.
• Lack of features. Compared to more feature-rich providers like H&R Block and TurboTax, Liberty Tax gives users little in the way of tools and resources.

The post Liberty Tax Online Review 2023 appeared first on Investor Junkie.

When someone owes you money, you want to know when they’re going to pay you back. Maybe you give them a little more time if you like them a lot, but you still want to know.

When the government owes you money, especially when the government owes you money because you’ve overpaid your taxes, that money can’t come fast enough.

After you've filed your 2022 tax return, you'll want to know exactly when you should expect the cash you're entitled to. Well, unfortunately, you can't know exactly, but you can predict fairly well using the IRS refund schedule for 2023. Here, we'll share details about when refunds will be sent as well as what factors can impact their delivery. Let's get into it.

What Is the IRS Refund Schedule (2023)?

The IRS refund schedule predicts when you might receive your tax refund depending on how you file and when.

The tax deadline in 2023 falls on April 18 instead of the typical April 15. This means all taxpayers have until April 18 to submit their tax returns, but the tax season officially began on January 23. The IRS accepts tax refunds from the starting date of the tax season and issues refunds throughout the year. The schedule for this is varied.

Here's a simple breakdown of the IRS tax refund schedule for 2023.

• E-filed tax returns | direct deposit: Expect to receive your refund within three weeks of filing (usually 21 days)
• E-filed tax returns | paper check: Expect to receive your refund within three to four weeks of filing
• Paper filed tax returns | direct deposit: Expect to receive your refund within three weeks of filing
• Paper filed tax returns | paper check: Expect to receive your refund within six to eight weeks of filing

When you e-file, which is always our preferred method, you should receive your tax refund within 21 days of submitting your return. This factors in about two weeks for processing and payment after your return has been received and approved.

Typically, the IRS needs between 24 and 48 hours to accept your return if you file electronically, another 48 hours to approve it, and up to 19 days to send your refund using your preferred payment method (usually less).

But if you instead choose to paper file, the IRS may take up to six weeks to process your tax return and send your payment.

Point is, how long it takes to receive your tax refund payments after submitting your return completely depends on how you file and how you opt to receive your refund.

Note that there may be some exceptions to this schedule if the IRS needs to take more time to review your return, if there are any issues processing your return, and/or if you qualify for certain tax credits.

For example, tax returns that include the Earned Income Tax Credit (EITC) and Child Tax Credit (CTC) take longer to process, so the IRS doesn't start issuing refunds for those any sooner than mid-February. Most people who filed in late January and chose direct deposit for their refund should have received it by February 28th.

How To Contact the IRS

So what should you do if you know you filed correctly and your refund still isn't here?

Hold off on contacting the IRS about your tax refund until it has been at least four weeks since you filed your complete federal tax return. This is how long the IRS asks that you allow for processing and typical delays. If you do decide to reach out, call 1-800-829-4477 and be prepared to provide the Social Security number for the return you're calling about as well as your filing status and the total amount of your refund.

What Are the Fastest (and Slowest) Ways To Get Your Refund?

Year after year, e-filing your return and choosing direct deposit for payout ends up being the quickest way to get your IRS tax refund. And this holds true in 2023.

The slowest way to get your money is to file your tax return on paper, even slower if you choose to have a paper check mailed to you instead of a direct deposit scheduled. Whereas direct deposits hit taxpayer bank accounts almost immediately after processing, choosing to receive your refund as a paper check can take longer due to delays with mail delivery.

If you haven't filed yet and you want to get your tax refund as quickly as possible, filing electronically and choosing direct deposit is the fastest, easiest, and safest way to go.

How To Track Your IRS Tax Refund Online

There are a couple of different ways to track your IRS refund online. The first is to go directly through the IRS website and the second is to use the IRS2Go mobile app. These are both official tracking options offered by the IRS that are available to all tax filers. They will show your return status in one of three stages:

1. Return Received
2. Refund Approved
3. Refund Sent

If you filed electronically, you can start tracking your tax refund in as little as 24 hours after submitting your return. If you paper filed, wait four weeks to check the status.

We always recommend checking back often to make sure your tax return has been received. If there are any issues processing your return, you should be able to see that it's stuck and can contact the IRS to figure out why. It could be something as simple as mistyping on of the numbers of your SSN.

Many tax software programs such as TurboTax, H&R Block, and TaxAct also include their own refund tracking features. These work in much the same way as the programs provided by the IRS.

>>> Find out more: Best Tax Software for Investors 2023

How Much Will You Get Back?

If you're entitled to a tax refund at all (which not everyone is — some people end up owing money due to mid-year changes in your income, deductions, etc.), you'll see exactly how much you'll get back after filing. You can also estimate your refund before starting your return.

In 2023, many tax filers should expect smaller refunds than they received in 2022 and 2021. This is for a few reasons, including the fact that taxpayers will not receive stimulus payments this year as they might have in 2022 and that some tax credits such as the Child Tax Credit, which was temporarily increased during the pandemic, have returned to typical, inflation-adjusted levels.

>>> Find out more: 9 Ways to Reduce Your Taxable Income in 2023

What If You File A Tax Extension In 2023?

We get it. Tax season is a lot whether you've gone through it a hundred times or you're experiencing it for the first time.

When you feel like you just won't be able to get your return in by the tax deadline, you have the option to apply for an extension. In 2023, this extends the due date from April 18 to October 16. You need to request an extension using Form 4868 before the tax filing deadline to qualify. To file Form 4868, you need to provide an estimate of your tax liability.

Extensions give you more time to get your tax documents together but do not give you more time to pay what you owe. If you owe state or federal taxes, you will still be responsible for paying these by the tax filing deadline even if your return is not filed.

What If You Don’t File (or Pay) Your Taxes on Time?

The IRS accepts late returns even without an official extension, but with a big (potential) caveat. If you file late and owe taxes, you'll pay interest and fees until you file and pay. If you file late and are owed a refund, there is no penalty. As of 2023, the IRS charges an interest rate of 7% for underpayments.

But if you're getting a refund and you don't file your taxes on time, you won't get paid on time. The tax refund schedule assumes that you've gotten your return in on time and filers who got their tax returns in by the deadline will be prioritized over those who didn't. If you file after the due date, you can expect your return to take up to six weeks to process.

If you miss the deadline, you can still file your electronic tax refund free using IRS Free File until October 15.

What If You Need More Time To Pay?

This is another situation entirely. If you owe taxes and can't pay by the deadline, you can apply for a payment plan. The IRS accepts applications for payment plans from most filers. If your tax liability is less than $50,000 and you've filed all tax returns required of you, you may qualify for a long-term installment agreement with monthly payments. If your liability is less than $100,000, you may qualify for a short-term installment agreement of less than 180 days.

How To Get Your Tax Refund Faster

If you're really counting on your tax refund for any reason, you may be able to expedite it. This option is typically reserved for those experiencing financial hardship who need the money for things like basic living expenses and necessities. You just can't use this to pay off other federal debts like student loans or child support.

Eligibility for expedited refunds is determined on a case-by-case basis. You'll have to contact the IRS directly to find out if you qualify. You can reach out about this either before or after filing.

The Bottom Line

The good old Internal Revenue Service issues tax refunds as fast as it possibly can, but getting antsy when you find out you qualify for a return is understandable. Filing electronically and choosing direct deposit for your refund is the way to go for speedier refunds this filing season.

Use this IRS refund schedule for 2023 to find out when you might be able to expect your refund. And of course, use the IRS's refund tracking tools and tax software programs to check the status of your individual income tax return for more accurate estimates.

Read More:

• Can You Do Your Own Taxes?
• Taxes and Investing: What First-Time Investors Need to Know About Filing Taxes

The post IRS Refund Schedule 2023 appeared first on Investor Junkie.

With tax time upon us, you’re probably trying to figure out the best way to file your taxes. There are plenty of online options, and one of those is eSmart Tax®.

Before you decide to move forward with any tax software, however, it’s important to read reviews and figure out what is likely to work for you and your situation. If you’re considering eSmart Tax, here’s what you need to know.

What Is eSmart Tax?

eSmart Tax is owned by Liberty Tax. Even though Liberty has its own online filing software, it may be better known for its in-person services and offers this online-only platform as well. eSmart provides DIY e-filing options for filers who don’t need professional tax support.

With eSmart, navigation is self-guided so you can go at your own pace, but it’s pretty clunky. If you’re used to using other tax prep software, many of which use a question-and-answer format to walk you through your returns, you may find eSmart’s platform to be difficult to use. But we’ll go over how it all works later on.

Who Is eSmart Tax Good For?

eSmart Tax will work best for filers who are reasonably confident about their abilities and know what they need to do. If you don’t mind simplicity and only need a tiny bit of guidance as you fill out your tax forms, this can work well.

However, other providers offer better user experiences as well as more options for filing. eSmart Tax’s pricing is on par with mid-range tax software products, but it’s less convenient to use and lacking in features and support. Compared to both pricier and cheaper providers, it is far more limited.

TurboTax and H&R Block, for example, have more plans to choose from and plenty of options for adding extra help. You’ll pay a higher price, but you might end up with more peace of mind and more robust filing choices. Plus, with H&R Block, you can go into an office if you want in-person help. 

For the most part, eSmart Tax doesn’t offer anything out of the ordinary and we wouldn’t recommend it above other platforms. Confident filers can get better functionality at budget prices with TaxSlayer or TaxAct and filers who want more handholding can get it with TurboTax and H&R Block. There’s nothing to positively set eSmart Tax apart.

eSmart Tax Features

Sign up for eSmart Tax

eSmart Tax Plans and Pricing

There are three different pricing tiers with eSmart Tax: Basic, Deluxe, and Premium. There is no free option advertised for simple filers on their pricing page. No matter which online plan you choose, there are some features that come with all products:

• Free tech support including live chat
• Import previous returns
• State tax return prep for additional fee
• W-2 download
• Accuracy Guarantee, Satisfaction Guarantee, and Maximum Refund Guarantee

Note that for all filing plans, eSmart Tax limits you to one state return per federal return. So you can’t file multiple state returns.

Online Services

Basic

Federal return: $45.95

State return: $36.95

The eSmart Tax Basic online plan is for simple returns using Form 1040 or Form 8853. It supports Schedules A and B, W-2 and unemployment income, and both the standard deduction and Earned Income Credit.

This plan is only going to be a good fit for filers without dependents who earn a taxable income of less than $100,000. If you don’t qualify for this product, you’ll need to upgrade to at least Deluxe.

Deluxe

Federal return: $65.95

State return: $36.95

If you need to itemize deductions, this is the version you can use. This online plan allows you to take tax breaks for homeownership, child care, and education among other common deductions. eSmart Tax Deluxe supports Schedule C and both investment and retirement income.

This is probably the right eSmart Tax plan for most investors and families.

Premium

Federal return: $85.95

State return: $36.95

The Premium online plan with eSmart Tax is ideal for self-employed filers. It lets you access K-1 forms for LLC and S-Corp filing as well as Schedules E and F. With this plan, you can take self-employed tax deductions and manage the depreciation of assets. You can also enter rental property income and report capital gains and losses with Schedule D using this plan.

This is the package you need if your taxes are complex due to your income, deductions, and/or investments.

Tax Refund Options

There’s nothing special about the refund options offered by eSmart Tax. In fact, you have just the options the federal government provides in the form:

• Direct deposit
• Paper check
• U.S. savings bonds
• Apply to next year’s taxes

How to Sign Up

You can begin filing with eSmart Tax by selecting “Sign Up” at the top of the home page or clicking “Start Now” next to any package description. From there, you’ll create an account with your email and choose a username and password. 

Once that’s done, an email is sent containing your code to access the site. After you confirm your code, you can start importing your tax documents and filing your returns. 

You can find support options on the side as you file.

Sign up for eSmart Tax

Synchronization

Being able to import last year’s return is a plus, as is the fact that you can upload your W-2. You can also have your refund sent directly to your bank account. If you e-file and then select Direct Deposit, that’s the fastest way to receive your refund.

You can choose to save your tax return so you can log in later and finish.

Mobile Accessibility

There's no tax filing app from eSmart Tax, so if you want to do your taxes from your phone or tablet, you need to navigate to the site using your device’s browser. You can log into your account from any browser, but it may be harder to see and use when you’re on the phone. 

You’re better off using a tablet or computer to file with this provider or choosing a different platform altogether.

Customer Service

You can access customer service fairly easily using eSmart Tax, but you'll only be able to ask basic questions about the software rather than get tax-specific advice. eSmart offers email and chat support as well as support via Twitter and Facebook. There is also a “common questions” function in the software you can use to find answers to your questions as you fill out the return. Most of these questions are tech-related.

There aren’t the same tools as you would see with a more comprehensive platform such as TurboTax or H&R Block. These provide information boxes and helpful hints along the way to guide you through the process.

eSmart Tax Pros & Cons

Pros

• Guarantees. eSmart Tax guarantees accuracy and your maximum refund as well as satisfaction. While this is not uncommon, it is still appreciated.

Cons

• No free option. Most tax software providers offer a filing plan at no cost for simple tax situations.
• No mobile app. For filers who like the convenience of uploading forms and filling out their returns from their phone, this is a significant disadvantage.
• Limited features and functionality. eSmart Tax does not include as many helpful tools and resources as many other providers and also doesn’t offer added support for more complicated tax situations such as self-employed taxes.
• Limited support. While online chat may be available for tech questions, there are no options for live assistance from tax professionals.
• Clunky platform. The interface for this provider is not as easy to use as competitor platforms.
• No software downloads or professional preparation. eSmart Tax does not allow you to purchase software instead of e-filing and does not provide preparation services.

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