Clark Howard

I’ve always loved traveling during the fall. Traditionally, the weather is still great, the crowds are much smaller, and you get a massive discount on hotels and airfare.

Not this year.

Because of high fuel prices and shifting travel demand, what we in the travel industry call the “shoulder season” (fall and spring) virtually doesn’t exist right now. Domestic and international flight prices for this fall and spring are running as expensive as summer airfare was a year ago.

So, how do you put together an affordable trip when the traditional deal windows have vanished? You’re going to need to embrace an old-school travel secret.

The Return of the Deep-Winter Bargain

I’ve gotten spoiled over the years because there used to be so many great deals during mild-weather months, allowing me to avoid really cold destinations in the dead of winter. But we are back to an old pattern: If you want to go somewhere at the low prices you’re used to, it’s going to have to be a winter trip.

If you want the calendar to be your friend, look at traveling to Europe or North Asia during:

November

December (excluding peak holiday weeks)

January

February

I remember traveling to South Korea in late January one year. To say it was cold doesn’t really explain it — I think I’m still thawing out from how frozen I was on that trip! But going when other people are smart enough to stay home and avoid freezing allows you to overcome high airfare and score cheap hotel rates.

Me? I’ll go freeze, because I don’t want to give up traveling, and I refuse to overpay.

How To Handle High Travel Costs Right Now

If you are planning a trip soon, you have two real choices:

Spring for warm clothes and embrace the cold: Head to Europe or North Asia during the dead of winter. Pack your heaviest thermal coats and layer up like you’re heading to the South Pole. You will save a bundle on airfare and lodging.

Wait it out: If you can’t stand the cold, pause your major travel plans for a bit and go when fuel prices stabilize and shoulder-season deals return.

Final Thoughts

High fuel prices and unpredictable travel shifts won’t last forever — this ugly market picture will eventually sort itself out, and shoulder-season deals will make a comeback. In the meantime, you don’t have to give up exploring the world just to stay on budget.

If you’re willing to be flexible with your calendar, grab a heavy coat, and embrace deep-winter travel, you can still land fantastic bargains on flights and hotels. And if cold weather isn’t your thing? Simply hold off on major trips until rates cool down. Either way, letting the calendar work for you puts you back in control of your travel budget. It’s your money — don’t waste it overpaying for flights!
The post Why the Travel ‘Shoulder Season’ Is Dead This Year appeared first on Clark Howard.

Many investors assume that if they sell an investment for a profit, they are guaranteed to owe taxes on the gain. Not always.

There is actually a 0% federal tax bracket for long-term capital gains. It can be especially valuable for retirees, early retirees living off cash reserves, or anyone experiencing a temporary dip in taxable income.

For 2026, the 0% long-term capital gains rate applies to taxable income up to:

$49,450 for single filers

$98,900 for married couples filing jointly

$66,200 for heads of household

The 20% rate generally applies to the portion of taxable income above $545,500 for single filers and $613,700 for married couples filing jointly.

The key operative term is taxable income.

You do not need zero income — or even particularly low gross household income — to qualify for the 0% bracket. With proper planning, you can deliberately sell appreciated investments without paying a single dollar in federal capital gains taxes.

How the 0% Capital Gains Bracket Works

Capital gains are taxed differently than ordinary income, such as wages, pensions, and traditional IRA withdrawals.

Short-Term Gains: Investments held for one year or less are taxed at ordinary income tax rates.

Long-Term Gains: Investments held for more than one year qualify for preferential rates of 0%, 15%, or 20%.

To determine your rate, the IRS uses a “stacking” rule: your ordinary taxable income forms the base of the stack, and your long-term capital gains sit on top.

Baseline Example: Married Couple Stacking Income

Here is how ordinary income and capital gains stack against the married joint threshold in 2026:

Because their combined total of $90,000 is under the $98,900 threshold, the entire $30,000 investment gain falls in the 0% bracket.

You Can Have More Income Than You Think

The capital gains thresholds apply to taxable income, not your total Adjusted Gross Income (AGI) or gross cash flow. Before measuring yourself against the threshold, you subtract your standard deduction or itemized deductions.

2026 Standard Deductions

Real-World Purchasing Power Schedule

Because the 0% capital-gains threshold is based on taxable income, you can have more gross income than the threshold and still qualify for the 0% rate.

By adding the basic standard deduction to the threshold, you can get a rough idea of how much combined ordinary income and long-term capital gains a household could have before reaching the 0% capital-gains threshold:

These are simplified illustrations that assume the taxpayer takes the standard deduction and has no other adjustments or deductions. The figures for taxpayers age 65 and older do not include the separate enhanced senior deduction available in 2026.

For 2026, eligible taxpayers age 65 and older may also qualify for an additional $6,000 deduction per person — up to $12,000 for a married couple when both spouses qualify. However, that deduction phases out at higher modified adjusted gross income levels. Because capital gains can increase your income, you shouldn’t simply add the full senior deduction to the figures above when estimating how much you can realize at a 0% capital-gains rate.

For example, a married couple under age 65 with $131,100 in combined ordinary income and long-term capital gains and a $32,200 standard deduction would have $98,900 in taxable income, putting them at the top of the 0% long-term capital-gains bracket.

The Core Strategy: “Tax-Gain Harvesting”

If you find yourself with room in the 0% bracket, you do not have to leave that tax-free capacity on the table. You can use a strategy known as tax-gain harvesting.

In tax-gain harvesting, you deliberately sell appreciated assets in a taxable brokerage account to lock in the 0% rate, and then immediately buy them back.

The wash-sale rules apply to losses, not gains, so there is no 30-day waiting period for repurchasing an investment after realizing a gain.

Why Do This?

You reset your cost basis: If you bought an ETF for $10,000 that is now worth $25,000, selling it realizes a $15,000 gain. If your federal rate is 0%, you owe $0.

You repurchase immediately: You buy back the same ETF at the current $25,000 market value. Your new cost basis is $25,000.

Future tax savings: When you eventually liquidate the fund in a higher-income year, you will only pay taxes on growth above $25,000, rather than growth above your original $10,000 purchase price.

Does This Apply to IRAs and 401(k)s?

No, the 0% capital gains rate exists exclusively for taxable brokerage accounts.

The IRS does not look at what happens inside a retirement wrapper; it only looks at the wrapper itself:

The IRA Conflict: Crowding Out the 0% Bracket

Because withdrawals from Traditional IRAs and 401(k)s count as ordinary taxable income, they sit at the bottom of your income stack:

If you take a large Traditional IRA withdrawal, that money fills up your lower brackets first.

The ordinary income pushes your long-term capital gains further up the stack.

If your IRA withdrawals alone reach the $49,450 (single) or $98,900 (married) mark, any capital gains in your taxable account are automatically pushed into the 15% bracket.

The Roth Conversion Dilemma: In a low-income year, you must often choose between harvesting capital gains at 0% in your brokerage account OR converting Traditional IRA money to a Roth IRA at low ordinary rates (10% or 12%). Doing both at once can cause the Roth conversion to push your capital gains out of the 0% bracket.

What Happens if You Cross the Line? The “Straddle” Rule

Investors often fear that earning $1 over the threshold pushes their entire gain into the 15% bracket. This is a misconception. Capital gains brackets are progressive.

Only the portion of the gain that spills over the line is taxed at 15%.

Spreadsheet Example: Single Filer Straddle Calculation

Below is the exact math breakdown for a single filer with $44,450 in ordinary taxable income who realizes a $15,000 capital gain in 2026:

Critical Caveats to Watch Out For

While a 0% federal rate sounds entirely free, realizing capital gains inflates your Adjusted Gross Income (AGI). This can trigger costly ripple effects across other areas of your tax return:

Social Security Taxation: Capital gains increase your “provisional income.” This can cause up to 85% of your Social Security benefits to become subject to ordinary income tax.

Medicare IRMAA Surcharges: The Income-Related Monthly Adjustment Amount (IRMAA) adds steep surcharges to Medicare Part B and Part D premiums if your Modified AGI crosses specific tier thresholds. Medicare uses a two-year lookback period — meaning gains harvested in 2026 dictate your Medicare premiums in 2028.

ACA Health Insurance Subsidies: For early retirees under 65 who rely on Affordable Care Act (ACA) marketplace plans, higher income can reduce or eliminate Premium Tax Credits.

State Income Taxes: The 0% rate is strictly a federal bracket. Many states (including California, New York, and Massachusetts) do not recognize preferential capital gains rates and tax your profits as ordinary state income.

Key Takeaways: Simplicity in Theory, Precision in Execution

The concept behind the 0% capital gains bracket is straightforward: if your taxable income is low enough, you can lock in investment profits without owing a dollar in federal taxes.

However, in practice, the implementation has many moving parts:

Everything interconnects: Because ordinary income, capital gains, Social Security benefits, and deductions all stack on top of one another, pulling one lever inevitably shifts another.

Hidden cliffs: An unintentional move can bump your Medicare premiums via IRMAA two years later, trigger surprise state tax bills, or push Social Security benefits into higher taxable tiers.

Competing strategies: Deciding whether to use your low-bracket headroom for tax-gain harvesting versus Roth conversions requires weighing today’s savings against future tax liabilities.

Final Thoughts

The 0% capital gains tax bracket can be a valuable opportunity to lock in investment gains without owing federal capital gains tax. But taking advantage of it requires looking at your entire tax picture — not just the amount you’re planning to sell.

If you’re nearing retirement or already navigating your distribution years, you don’t have to figure it all out through trial and error. A qualified tax advisor or fee-only financial planner can help you coordinate investment sales, retirement-account withdrawals and other sources of income from year to year, while considering potential effects on Social Security, Medicare and other taxes.

The goal isn’t simply to pay less tax today. It’s to make thoughtful decisions about when and how to realize income so you can keep more of your money working for you over the long term.

The post You May Be Able To Sell Investments and Pay 0% Capital Gains Tax appeared first on Clark Howard.

Known for its bulk groceries, low-cost gasoline, and member-focused deals, retail giant Costco is expanding into a brand-new space: Medicare plans. Through a partnership with SCAN Health Plan, the warehouse club is rolling out co-branded Medicare Advantage products.

While shoppers might trust Costco to deliver top value on household goods, money expert Clark Howard warns that mixing the wholesale brand with Medicare Advantage may not be wise for seniors.

Here is why Clark is deeply skeptical of the warehouse club’s newest venture — and why he urges shoppers to proceed with extreme caution.

Costco Is Getting Into the Medicare Advantage Game

Costco’s venture into health insurance represents a major shift. While the warehouse chain already offers pharmacy services, vision care, and hearing aids, selling full-fledged Medicare Advantage insurance policies takes things to an entirely different level.

“Costco is getting into the Medicare Advantage game. I don’t like that Costco is doing it.”

For Clark, the issue isn’t about Costco’s retail value; it’s about the fundamental structure of Medicare Advantage plans.

Why Clark Calls Them “Disadvantage” Plans

Although private insurance carriers push Medicare Advantage plans for their low monthly premiums and extra perks (like gym memberships or vision allowances), Clark has long argued that these plans carry hidden costs that surface when members need care the most.

“I don’t like the idea of Advantage plans. People love ‘disadvantaged’ plans till something goes wrong with their health. And when the chips are down, they need care. And then the ‘disadvantage’ plan is all about denial.”

Unlike traditional Medicare paired with a Medigap policy — which allows patients to see virtually any doctor or specialist nationwide — Medicare Advantage relies on restricted provider networks, prior authorizations, and private insurers managing claims. When major health challenges arise, insurers often impose stringent limits or deny critical treatments to manage costs.

A Limited Rollout — For Now

By putting its trusted name on these insurance offerings, Costco may lead long-time members to assume that a store-branded Medicare plan carries the same low risk as buying a bulk paper towel deal. Clark worries that this brand trust could lull shoppers into a false sense of security.

Fortunately for consumers, the initiative is starting on a very small scale. Reports indicate that Costco and SCAN Health Plan are launching Medicare Advantage in just two states.

“So Costco getting involved in ‘disadvantage’ plans is an experiment. I’m not going to say any soft-pedal this at all, but fortunately, I think it’s only in two states. I wish it was in zero states.”

Final Thoughts

If you are approaching age 65 or looking at Medicare coverage options during open enrollment, don’t let retail brand loyalty dictate your healthcare choices.

Before signing up for an Advantage plan, carefully evaluate original Medicare paired with a Medicare Supplement (Medigap) plan and Part D drug plan to protect yourself from denial-of-care issues down the road.

If you want to talk through your options, try SHIPhelp.org or Chapter. Both are free to use and offer unbiased advice.
The post Why Clark Howard Is Sounding the Alarm on Costco’s New Medicare Experiment appeared first on Clark Howard.

If you’ve looked at travel prices lately, you’ve probably noticed severe sticker shock. From airline tickets to cruises, anything heavily dependent on fuel has seen prices go crazy.

Cruise lines, in particular, are caught in a major economic bind right now. Unlike airlines, cruise companies sell their cabins way in advance — often a year or two before sailing. On top of that, most cruise lines don’t hedge their fuel costs. When you think about how much fuel it takes to run a giant ship on a 3-, 5-, 7-, or 14-day itinerary, it’s a humongous expense.

Because they locked in your cabin fare months ago when economic conditions were completely different, cruise lines are looking for other ways to make up the difference. Here is what you need to know before your next voyage.

Expect Higher Onboard Prices and Service Fees

Since cruise lines can’t retroactively change the base cabin price you paid a year ago, they are raising the prices of everything else on the ship.

Once you’re onboard, you need to be extra vigilant. Things you may routinely buy on a cruise are going to cost significantly more than you are used to:

Drink packages: Daily beverage packages and individual bar prices are creeping higher.

Daily service fees and gratuities: Many cruise lines are quietly raising their mandatory daily gratuities or service charges. Depending on the contract, they can often apply these higher daily fees even to passengers who booked long ago.

Excursions and add-ons: Expect higher prices for specialty dining, Wi-Fi packages, and shore excursions.

It’s a tough time to own a cruise line, but as a passenger, you shouldn’t let these extra charges catch you off guard or ruin your vacation budget.

How To Protect Your Wallet

Audit your onboard spend before you sail: Lock in drink packages, Wi-Fi, and shore excursions online before your cruise date if the cruise line lets you prepay at older rates.

Review gratuity policies: Check your booking confirmation to see if you can prepay your daily service fees at the current rate before any announced increases kick in.

Set a strict onboard budget: Treat onboard extras as optional. Skip the pricey specialty dining and stick to the included venues, or skip the unlimited drink package.

Final Thoughts

At the end of the day, fuel price run-ups and supply issues are temporary, and this market will eventually stabilize. But right now, the cruise lines are aggressively looking for ways to protect their bottom line — and that means you have to actively protect yours.

Don’t let unexpected onboard expenses turn a great deal into a budget-buster. By locking in your packages early, keeping a close eye on service fee changes, and being deliberate about where you spend your money once you step on the ship, you can still enjoy a fantastic cruise without overpaying. It’s your money!
The post Why Your Next Cruise Is Going to Cost More Than You Think appeared first on Clark Howard.

A listener recently wrote into the podcast with a question that hits at the core of my travel philosophy. He said:

“You talk a lot about reshopping travel deals, but how do you do it safely? Do you book the new deal before canceling the old one, or cancel first and then rebook? What happens if you cancel and the new deal falls through? And how do airlines handle this compared to cars and hotels?”

These are the right questions. Reshopping your travel reservations is one of the easiest ways to pocket extra cash on a trip you were going to take anyway, but if you do it in the wrong order, you risk getting stranded or left with nothing.

Here is my golden rule of travel reshopping, along with exactly how I handle rental cars, hotels, and airline tickets.

The Golden Rule: Lock It In First, Cancel Second

The golden rule of reshopping travel is simple: Always confirm your new, cheaper reservation before you cancel your original one.

Never, ever cancel what you have sitting in hand on the hope that a lower price will go through. Travel prices and availability fluctuate by the second. If you cancel your original booking first and then the lower rate suddenly disappears or fails to confirm, you could end up with a higher price — or no reservation at all.

I’ll give you a real-world example from a trip I just took to California. While I was sitting on the plane, I took advantage of the flight’s free Wi-Fi and thought, “You know what? I rebooked my rental car last week, but let me check if it’s gotten any cheaper again.”

Sure enough, the price had dropped. I booked the new rental car right there at 30,000 feet, waited for the confirmation screen, and then went back and canceled my original booking. That quick check saved me $45.

How To Reshop Rental Cars

Rental cars are the easiest and safest travel category to reshop.

Most traditional rental car reservations don’t require upfront payment and have no cancellation fees.

Reserve your car as early as you can without prepaying. In the days and weeks leading up to your trip — even right up until the day you fly — check rates again using a comparison site or a free tracking tool like AutoSlash.

If you spot a lower rate, complete the new booking first. Once you have the new confirmation number in hand, cancel the old one.

How To Reshop Hotels

Hotels are another great opportunity for savings, provided you book the right kind of rate.

Never book non-refundable hotel rooms. I always choose rates that offer flexible cancellation without penalty — usually allowing you to cancel up to two or three days before arrival.

During the week of the trip, reshop my hotel bookings. Because of cancellation policies, you usually can’t do this at the very last second like a rental car, but if you find a lower rate a few days out, book the cheaper room first. Once that new confirmation hits your inbox, cancel the original reservation.

The Catch: Reshopping Airline Tickets

Reshopping flights is a whole different ballgame and carries much more risk.

Airlines will generally not allow you to double-book yourself on the exact same flight under the same name. Their automated systems will often flag and cancel duplicate itineraries. Moreover, when you cancel a flight, you rarely get cash back — you get an airline credit.

For example, on that same recent trip, I was originally booked on Delta. Right before the trip, I found a last-minute deal on American Airlines. I booked the American flight first, and once it was locked in, I canceled my Delta ticket.

Because of the cancellation, I received a $352 Delta credit with 10 months left to use it (since airline credits are typically valid for one year from the original date of purchase).

Should You Reshop Flights?

If you fly frequently: Reshopping can make a lot of sense. I fly constantly, so that $352 credit is as good as cash in my pocket — I know without a doubt I’ll use it before it expires.

If you fly once or twice a year: Be very careful. Unless you are positive you will take another trip with that specific airline within 12 months of your original booking date, that flight credit could expire unused. In that case, “saving” money by switching flights actually costs you cash out of pocket.

Summary Checklist for Reshopping

Book flexible options upfront: Choose pay-at-counter rental cars and refundable hotel rates.

Shop again close to your travel date: Check prices a week out, a few days out, and right before you depart.

Secure the new rate first: Complete the new reservation and wait for the confirmation.

Cancel the original booking: Immediately cancel the old reservation to avoid double charges or no-show fees.

Mind the flight credits: Only reshop flights if you are certain you’ll use the resulting airline credit before it expires.

The post The Safe Way to Reshop Your Travel Deals and Save Hundreds appeared first on Clark Howard.

Recently, an ABC affiliate in the San Francisco Bay Area reported a heartbreaking story about a woman who had her entire life savings drained — money she had invested with Charles Schwab — in just minutes.

This scenario is happening repeatedly with banks, credit unions, and investment brokerages. Criminals are using advanced technology to convince you there’s an urgent problem with your account when there isn’t one.

Here is how this devastating scam works and, most importantly, the exact rule you must follow to protect your money.

How the Account Takeover Scam Works

The core strategy involves a thief contacting you and claiming to be an employee at your bank, credit union, or brokerage firm. They will alert you to a supposed “data leak” or suspicious activity on your account. Ironically, they are predicting the future — because they are the ones trying to steal your money.

Here is why so many people fall victim to this scheme:

Sophisticated caller ID spoofing: The incoming call or text message will display the actual name and phone number of your financial institution (like Charles Schwab, Vanguard, Capital One, or your local credit union).

Prior breached data: Thanks to past major data leaks at credit bureaus and major companies, criminals often already know a lot about you, including your name, address, and where you hold accounts.

Manufactured urgency: They practice creating intense panic. They will tell you your money is at risk right now and that you must act immediately to secure it.

The two-factor authentication trap: The scammer will tell you they are sending a verification code to your phone and ask you to read it back to them. That text is actually a real two-factor authentication (2FA) code generated by the scammer trying to log into your account. Once you give them that code, they gain total control and sweep your accounts clean before you even realize what happened.

The Dangerous Legal Gray Area

This specific tactic is so dangerous because of how financial protections work.

Under federal law, you have strong protections against unauthorized hacks or thefts from banks and credit unions. While the law is a bit fuzzier for investment brokerages, most firms maintain company policies to cover you if a hacker breaks in without your knowledge.

However, when a scammer tricks you into providing a 2FA code or approving a transfer, financial institutions view you as a participant in the transaction. Because you voluntarily handed over the key, banks often claim standard fraud protections don’t apply — leaving victims with no legal recourse to recover their lost life savings.

How To Protect Yourself

If you receive a phone call, text, email, or social media message out of the blue from someone claiming to be in the fraud or security department of your financial institution, follow this rule and these steps without exception:

Do not engage: Simply say, “Thank you so much for the alert,” and hang up immediately.

Never trust caller ID: It does not matter if your phone says the call is coming from your bank. Criminals spoof numbers every single day.

Log in independently: Go directly to your financial institution’s official website or mobile app. Log in securely and locate the official customer service or fraud department phone number listed on your account or the back of your debit/credit card.

Verify the alert: Call that official number yourself. Virtually 100% of the time, you’ll learn your account is safe and that the caller was a scammer trying to take over your account.

What To Do If You’re Targeted

If you get one of these calls, know that the criminal did not pick you at random. They have done their homework and already have background information on you. This may be their first attempt.

Take these defensive security steps immediately:

Change your credentials: Update the username and password for the targeted account.

Audit your other accounts: Think through every financial login you use. If you have used the same password across multiple websites, change those immediately to unique, strong passwords.

Final Thoughts

The bottom line is that you can never let your guard down when it comes to unsolicited contacts about your money. The technology criminals use today makes them look and sound completely legitimate, but by refusing to engage and taking control of the conversation yourself, you can keep your hard-earned life savings secure. Always hang up, log in independently, and verify — it’s the single best defense you have to make sure you never become a victim of account takeover fraud.
The post Warning: A Devastating Bank Impersonation Scam Is Draining Life Savings in Minutes appeared first on Clark Howard.

Do you have a rewards credit card with Capital One or Discover?

You’ve probably had questions amid Capital One’s acquisition of Discover, such as:

What does this mean if I’m a Discover customer?

What will the transition process look like for me?

Will I lose some of my favorite Discover perks?

Will there be changes to my Capital One credit card?

Money expert Clark Howard has fielded several questions about the future of these brands since the acquisition announcement.

But now that Capital One wholly owns and fully controls Discover, people are receiving notices that their Discover accounts are migrating to the Capital One platform and that select Capital One cards are moving to the Discover network.

And that’s creating more questions.

In a recent episode of The Clark Howard Podcast, a reader raised one of the more common questions: How will all of these changes impact my credit card mix?

Let’s look at how Clark says this can affect your credit card mix, an important ingredient in a good credit score.

Ask Clark: How Does Capital One’s Acquisition of Discover Impact My Credit Card Mix?

Pete in Nevada asks:

“Hi Clark, I have two credit cards: one Visa and one Discover. My Visa started out with a credit union, but over two mergers, Bank of America now owns it. My Discover used to be independent, but was acquired by Capital One. I think I want to get a third card. My credit score is 828, and I want to know if Capital One should be considered, or would that now be considered a second Capital One card?”

Clark responds:

“OK, so I’ve always said you want at least two cards from two different issuers. You already have that. If the best offer out there is another Capital One, it is OK to do it because you’re with Bank of America and Capital One. So if one of them has a bad day and gets rid of you, you still have credit with someone else. I mean, you could go to a third issuer. You could even go to another credit union that actually issues their own credit cards, but that’s more and more rare.”

Breaking Down What This Means for Your Wallet and Credit Score

It’s no surprise that Clark pointed Pete toward his “Noah’s Ark” rule, which is featured prominently in his 7 rules for using credit cards.

The basic premise is this: You need at least two credit cards from two separate issuers to ensure that you don’t get your credit line slashed or canceled altogether by one institution’s decision-making.

This Capital One-Discover acquisition has created some confusion when it comes to adhering to this rule for a couple of key reasons:

Discover credit cards are now issued by Capital One.

Some Capital One credit cards now carry a Discover logo.

The simplest way to think about this is: All Discover and Capital One credit cards are now issued ONLY by Capital One.

There are no longer credit cards issued by Discover Bank. Instead, Capital One will be servicing Discover-branded credit cards while also using the Discover Network for card processing on select Capital One-branded credit cards.

If you had a Capital One card and a Discover card, you now have two credit cards that are issued by Capital One. So you went from two issuers to a single issuer, which could create a need to consider a third credit card to get you back to two separate issuers.

If you had just a Discover card, you effectively now just have a Capital One credit card. Any new Capital One cards that you add in addition to having the Discover card would mean that you now have multiple Capital One credit cards.

How Does This Impact My Credit Score?

If you’ve been a long-time Discover cardholder, you may be worried about how this migration to Capital One will impact your credit score.

After all, things like the age of credit cards and the number of open credit accounts can have a direct impact on your score.

The good news is that you’ll get to keep your payment history from your relationship with Discover even though Capital One will be your credit issuer reporting to the bureaus moving forward.

Capital One says the following in its FAQ for Discover customers migrating to their platform:

“This change won’t be reported as a new account, and your account open date will appear as the same date currently reported on your credit file. The credit bureaus will continue to receive updates based on your ongoing account performance.”

Capital One also says the name on the credit file may change to “Discover by Capital One” or simply “Capital One.” It warns that can trigger credit-monitoring alerts even though it is not a new account.

I encourage you to check out that FAQ page if you have more concerns about this migration. It answers many of the most common questions Discover customers have about the changes to their service.

Do you have a Discover card or bank account? Where are you at in the Capital One migration process? We’d love to hear from you in the Clark.com community.
The post How Does the Capital One-Discover Merger Impact My Credit Mix? Clark Howard Explains appeared first on Clark Howard.

If you are looking for a deal on running or walking shoes, the time to buy is right now.

I wear Hokas, and recently their prices crept up into a territory that is simply unacceptable for me — well into the triple digits. But because shoes are so personal and these happen to be the most comfortable shoes I’ve ever owned, I kept my eyes open for a bargain. Sure enough, I was able to buy a brand-new pair of the exact Hokas I wear for just $82.

And no, I didn’t just get lucky.

The market for running and walking shoes is completely over-sourced right now. There are way too many providers, and many of them are struggling. Brands that were red-hot suddenly aren’t, and as a result, prices are dropping across the board.

4 Tips to Save Money on Your Next Pair of Running or Walking Shoes

That overstock is your opportunity to save. Here is how you can cash in on the current shoe glut:

Watch clearance sites like Woot: I’ve noticed a massive uptick in shoe sales on Woot.com, Amazon’s clearance site. Shoe deals there used to pop up maybe six to eight times a year. Recently, I’ve seen them run shoe deals twice in just 10 days. That tells me retailers are sitting on a massive surplus they are desperate to clear out.

Take advantage of seasonal off-peaks: As days get shorter and the weather turns colder across much of the country, fewer people naturally head out to buy new running or walking shoes. Combining this seasonal dip in demand with an already overcrowded brand market means retailers are forced to slash prices to move inventory.

Buy previous generations: One of my favorite rules of thumb is to buy one generation back. When a shoe company releases a new model, the previous version suddenly drops in price, even though it’s still a fantastic shoe.

Check unexpected retailers: Don’t limit your search to traditional sporting goods stores. A while back, a friend of mine showed up in a brand-new pair of Hokas. When I asked where he got them, he mentioned Nordstrom Rack — the discount arm of Nordstrom. It’s a store I almost never visit, but after breakfast that day, I went straight to a local Nordstrom Rack and found a pair on deep discount.

Final Thoughts

You shouldn’t have to pay full, triple-digit retail prices for high-quality athletic shoes — especially right now. Between market oversupply, seasonal slumps, and heavy retailer discounts, the ball is entirely in your court as a shopper.

Take a few minutes to check clearance sites like Woot, browse off-price retailers like Nordstrom Rack, and consider buying last year’s model. By being just a little patient and shopping strategically, you can easily keep your feet comfortable and keep plenty of extra cash in your wallet.

You can find the latest deals on running and walking shoes at ClarkDeals.com.
The post How To Get Top-Brand Running Shoes for Cheap Right Now appeared first on Clark Howard.

If you’re over age 70½ and regularly give money to charity, there’s a powerful tax strategy you should know about.

It’s called a Qualified Charitable Distribution, or QCD.

The idea is simple: Instead of withdrawing money from your traditional IRA, depositing it into your checking account, and then writing a check to charity, you instruct your IRA custodian to send the funds directly to the organization.

The charity receives the exact same donation, but you avoid paying income tax on the distribution.

What Is a Qualified Charitable Distribution?

A QCD allows someone age 70½ or older to transfer money directly from an IRA to a qualifying 501(c)(3) charitable organization. When executed correctly, the amount transferred is excluded from your taxable income.

A key advantage is timing: You can begin making QCDs as soon as you turn 70½, even though required minimum distributions (RMDs) do not kick in until age 73 (or age 75 for those born in 1960 or later).

For most retirees, QCDs involve money from a traditional IRA. The core rule is that the money must transfer directly from the account to the organization. You cannot withdraw the money into your personal bank account first and later claim it as a QCD.

Why Is a QCD Better Than Writing a Regular Check?

Consider a retiree who donates $10,000 to charity each year. There are two ways to fund that gift from retirement savings:

Option 1: Withdraw Cash First

You withdraw $10,000 from your traditional IRA and put it in your bank account. That $10,000 counts as taxable income. You then write a $10,000 check to the charity.

To get a federal tax deduction for the charitable donation, you must itemize your deductions instead of taking the standard deduction. You claim those itemized deductions on Schedule A, a tax form filed with your federal income tax return.

But most taxpayers now take the standard deduction. If you do, you pay income tax on the $10,000 IRA withdrawal without getting a federal tax deduction for your $10,000 charitable gift.

Option 2: Make a QCD

You instruct your IRA custodian to send $10,000 directly to the charity.

The charity still receives the full $10,000. But because the money qualifies as a QCD, the $10,000 doesn’t count as taxable income to you.

You get the tax benefit of keeping that $10,000 out of your taxable income, whether you take the standard deduction or itemize your deductions.

How QCDs Work With Required Minimum Distributions (RMDs)

QCDs become even more valuable once mandatory retirement distributions begin.

A QCD can satisfy all or part of your required minimum distribution for the year. Let’s look at an example:

Suppose your RMD for the year is $30,000, and you plan to give $10,000 to charity. If you send $10,000 directly from your IRA as a QCD, that transfer counts toward your annual RMD. You only need to withdraw the remaining $20,000 in taxable cash to satisfy the IRS requirement. Instead of reporting $30,000 of taxable IRA income, you report only $20,000.

The “First Dollars Out” Rule

There is a vital timing rule to keep in mind: The IRS treats the first distributions taken from an IRA during a calendar year as counting toward your RMD.

If your annual RMD is $30,000 and you withdraw that full amount in cash early in the year, you cannot retroactively offset it with a QCD in November. To use a QCD to satisfy your RMD, the charitable transfer must occur before or as part of meeting your required distribution amount.

Lowering Adjusted Gross Income (AGI) Has Ripple Effects

A charitable deduction on Schedule A lowers taxable income, but it does not lower your Adjusted Gross Income (AGI).

A QCD, on the other hand, prevents the distribution from entering your gross income in the first place. Keeping your AGI and Modified AGI (MAGI) down can create significant second-order savings:

Medicare IRMAA surcharges: Higher AGI can push you over steep income thresholds, triggering higher monthly premiums for Medicare Part B and Part D.

Taxes on Social Security: Lower overall income can reduce the taxable portion of your Social Security benefits (up to 85% of benefits can become taxable at higher income levels).

Net Investment Income Tax (NIIT): Helps keep total income below the thresholds for the 3.8% surtax on investment earnings.

What About the Charitable Deduction for Non-Itemizers?

Starting in the 2026 tax year, federal tax rules under the One Big Beautiful Bill Act allow taxpayers who take the standard deduction to claim an above-the-line deduction of up to $1,000 for single filers or $2,000 for married couples filing jointly for qualified cash donations made directly to public charities.

While this provides welcome tax relief for donors making modest gifts from a checking account, a QCD remains vastly superior for IRA owners age 70½ and older:

It doesn’t satisfy RMDs: Writing a personal check to claim the non-itemizer cash deduction does not count toward your mandatory IRA distributions. A QCD satisfies your RMD dollar-for-dollar.

Substantially higher limits: The non-itemizer deduction is capped at $1,000 or $2,000. By contrast, the QCD cap is $108,000 per person for 2025 and $111,000 for 2026.

Stronger AGI protection: The non-itemizer deduction is subtracted after gross income is calculated, whereas a QCD never enters your gross income at all — giving you greater protection against Medicare premium spikes and Social Security tax thresholds.

If you don’t have a traditional IRA or haven’t yet reached age 70½, the non-itemizer deduction is a great tool. But if you’re eligible for a QCD, the IRA route delivers far more leverage.

Important Rules and Restrictions

While the process is straightforward, the IRS enforces strict parameters:

Direct Transfer Rule (with one practical exception): The funds must go directly from the IRA to the charity. However, many custodians will issue a check made payable directly to the charitable organization and mail it to your home address, allowing you to hand-deliver or mail the gift personally. As long as the check is made payable to the 501(c)(3) and not to you, this complies with IRS guidelines.

Ineligible Organizations: You can’t send QCDs to Donor-Advised Funds (DAFs), private non-operating foundations, or supporting organizations. The recipient must be an eligible 501(c)(3) public charity.

Exact Age Requirement: You must be at least 70½ on the exact day the distribution occurs — not merely turning 70½ later in the tax year.

No “Double Dipping”: Because the distribution is already excluded from your taxable income, you cannot also claim the transfer as an itemized charitable deduction on your tax return.

Annual Inflation-Adjusted Limits: The statutory QCD limit is $108,000 for 2025 and $111,000 for 2026 per individual. For married couples where both spouses have separate traditional IRAs and meet the age threshold, each spouse can utilize their full individual allowance.

How To Execute and Report a QCD

Contact your IRA custodian: Most major brokerage firms (Vanguard, Fidelity, Charles Schwab, etc.) offer a dedicated online form or paperwork for requesting a Qualified Charitable Distribution.

Obtain written acknowledgment: You must secure a written receipt from the charity acknowledging the gift and confirming that you received no goods or services in exchange.

Report it accurately on Form 1040: In January, your IRA custodian will issue a Form 1099-R. The 1099-R generally reports the transfer as a standard distribution without flagging that it went to charity. When preparing your tax return:

Enter the total distribution on Line 4a (e.g., $30,000).

Enter only the taxable remainder on Line 4b (e.g., $20,000).

Write or select “QCD” next to Line 4b.

If you work with a CPA or tax preparer, alert them in writing that you completed a QCD so they don’t inadvertently enter the entire distribution as taxable income.

Final Thoughts

If you are over 70½, have money in a traditional IRA, and regularly give to charity, don’t default to your checkbook.

A QCD lets you support the causes you care about while satisfying RMD obligations and sheltering your retirement income from unnecessary taxes. You aren’t giving away any more money — you are simply changing which account it comes from.

(Source: IRS Publication 590-B, Distributions from Individual Retirement Arrangements)
The post One of the Best Tax Breaks for Retirees Who Give to Charity appeared first on Clark Howard.

For a long time, financial progress was easy to measure. Your income went up, you bought a house, you paid down debt and your net worth grew until you retired. If those numbers were moving in the right direction, you were doing well.

A new survey suggests many Americans no longer keep score that way.

What People Now Count As Progress

SoFi and YouGov asked more than 4,000 U.S. adults what financial progress looks like. The most common answer, from 59% of respondents, was the ability to enjoy life. Owning a home, which sat near the top of the list for previous generations, was named by only 27%.

Nearly three in four people, 72%, said they would accept slower progress toward long-term goals if it meant they could spend money on travel, family activities and shared experiences now.

They haven’t given up on the future. In the same survey, 62% said a comfortable retirement is still a personal goal, but only 46% believe they will actually get there. When asked about their proudest financial achievements, younger respondents often pointed to things like ending the month with money left over or keeping an emergency fund stocked.

The numbers make more sense in context. Housing is expensive, interest rates have stayed high and the safety nets people expect to rely on feel less certain than they used to. Some people respond by focusing on what they can control and enjoy today. Others respond by saving harder, treating the same uncertainty as a reason to build their own cushion.

Money Has Two Jobs

There are two very different ways to think about money.

The first is to think of every dollar as a future dollar.

Money you invest in your 20s, 30s or 40s has years to compound. Spending that money today means giving up what it could become. Skip a $5,000 vacation at 35 and invest the money instead, and you’re giving that money decades to grow. Building savings, investments and home equity can also provide a financial cushion against job loss, medical bills and the possibility of a long retirement.

But money also has a time value that doesn’t show up on a spreadsheet. Some opportunities expire.

You can take another vacation 10 years from now, but you can’t take your 10-year-old to Disney when they’re 20 and recreate the same experience. Or, you might finally have enough money at 65 to take the hiking trip you’ve always dreamed about, but you may not have the health or energy you had at 55. Even something as simple as paying for a big family vacation can become harder to recreate once children move away, parents get older and everyone’s schedules change.

That doesn’t mean spending today is more important than saving for tomorrow. It means money has two jobs: helping you build financial security for the future and helping you make use of the life you have today.

Either philosophy can be taken too far.

“Enjoy life now” can gradually become an excuse for not saving enough. You don’t necessarily wake up one morning and decide to neglect retirement; it can happen $500 at a time as today’s wants continually take priority. The SoFi survey found that 27% of Americans have used Buy Now, Pay Later plans to cover expenses, an example of how spending for today can turn into borrowing from tomorrow.

But save-first thinking has its own risk. You can become so focused on maximizing your retirement account or net worth that you repeatedly postpone experiences you can afford, only to reach retirement with plenty of money and fewer opportunities to use it the way you once imagined.

It doesn’t have to be one or the other. It’s finding the point where you’re saving enough for your future without unnecessarily postponing the life that money is supposed to help you enjoy.

Final Thoughts

Money expert Clark Howard has long emphasized the value of spending money on experiences — especially time with family and travel — rather than automatically chasing a bigger house, newer car or higher net worth.

But there’s an important catch: Enjoying life today shouldn’t come at the expense of being able to afford your life tomorrow.

You don’t get those early saving years back. Money invested in your 30s can have decades to compound, while money you spend today is gone. At the same time, there are experiences you can’t simply reschedule for retirement. Your kids will grow up. Your parents will get older. Your health and priorities may change.

The goal, then, isn’t to choose between living for today and saving for tomorrow. It’s to make room for both.

Build an emergency fund, take advantage of your employer’s full retirement match and avoid financing your lifestyle with high-interest debt. Once those priorities are covered, give yourself permission to spend some of your money on the people, places and experiences that make your life richer now.

Because financial success isn’t just about how much you have when you retire. It’s also about what your money allows you to do along the way.

About the survey: The SoFi study was conducted online by YouGov from July 6 to 14, 2026, among 4,090 U.S. adults ages 18 to 65. The sample used nationally representative quotas for gender, age, education, race and region.
The post Americans Are Redefining What It Means To Be Financially Successful appeared first on Clark Howard.