Mortgage-Free Sounds Great — Is It? Plus More July Money Questions
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Every week, we answer money questions from around the web in the NerdWallet app. Here are three of the trending questions from July.
Should I pay off my loan early?
But putting savings into a loan also has a downside. You no longer have those savings for other needs, such as an emergency fund.
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What is the interest rate? If you have a low interest rate, it may make sense to carry the loan for longer. You can get more money with savings in a high-yield savings account or invest in the market than you save in mortgage interest by paying it off early.
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How much money do you have in savings? If you have enough savings that your loan payments won’t drain your bank accounts, then it’s easier to decide to put the money towards a mortgage. Make sure you have money left over to cover unexpected expenses.
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What is yours financial goals? If one of your goals is to lower your monthly expenses, then paying off a loan can make sense. If your goal is to accumulate a large nest egg, then you can keep your savings to use.
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How do you feel about your debt? Some people find any type of debt stressful. Some are not bothered by a regular loan payment. Figure out where you fall on that spectrum.
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How can I tell if AI is being used to scam me?
Scammers use AI in two main ways to trick you.
First, they use AI to comb through public data to create personalized emails. They include identifying details – such as your home address – that are more likely to fall victim to an impersonation attempt.
Second, they use AI to create audio, video and written messages that look like legitimate communications from financial institutions and government agencies.
When you’re trying to figure out if a message is generated by AI and intended to scam you, the bad news is that it can be difficult or nearly impossible to tell.
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Just hang on. Any unexpected phone call, email or text message should be treated with suspicion. When in doubt, don’t answer. Instead, call a verified number so you know who is on the other end.
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Familiarize yourself with AI-generated audio and video. Take a look at examples of AI scams posted online to understand what they look and sound like.
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Freeze your credit. Contact the three major credit bureaus to freeze your credit and prevent anyone from opening new accounts in your name. If you need a new line of credit, you can temporarily unfreeze it.
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Sign up for alerts. Choose text alerts and/or mobile notifications for any activity in your financial accounts. This gives you an early heads-up about any unexpected activity.
Can I still enjoy the summer without spending too much?
Summer can get expensive quickly. Between barbecues, pool days and weekend getaways, longer days can translate into higher credit card bills.
View your subscriptions, streaming services and other recurring charges. Saving a few dollars each month may not seem like much, but it adds up. Review larger bills, too — like insurance or cable costs — to see if you can negotiate a better rate or find a cheaper option.
Making some cuts now can free up money for summer fun.
Another helpful tip: Check out local events and free activities before splurging on flights.
Camping, day hikes, outdoor concerts and local parks all make great options for weekend fun, and they’re often free. Follow your city or Chamber of Commerce on social media so you don’t miss out.
If you have teenagers, consider encouraging them to gain work experience and earn extra money at the same time. A summer job is good practice in the “real world,” and it also gives them a chance to finance some of their own purchases.
Finally, try paying for summer fun with cash instead of racking up credit card debt. Before you know it, it will be time for Halloween pumpkins and apple cider. You don’t want to carry around a scary credit card bill at a scary time.
