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Moving can fire up a rollercoaster of emotions. The early rush of excitement may give way to stress over the looming to-do list of all that needs to happen before the big move.

Like any life transition, moving requires a lot of preparation. Thankfully, there’s no shortage of ways to help streamline the process.

Below are some tips that could make moving more efficient, including a guide to common costs to prepare for.

How to Streamline a Move

Here are a few helpful suggestions whether you’re easing into a new townhouse, apartment, condo, or home.

Get Rid of Unwanted Items

Moving is a chance to let go of items that have gone unused for months or years.

In addition to being able to get rid of unwanted “stuff,” decluttering can help you cut back on moving expenses. With fewer things to move from point A to point B, there’s less need for packing materials or an extra large moving truck. It may even help make the move speedier and more cost-effective, since there’s less stuff to carry (or pay someone else to carry). What’s more, reducing how much you have can also help ensure your new place won’t feel overstuffed.

Prepare Early

As you declutter, it can be useful to identify boxes and packing materials needed during the move, such as packing tape, markers, labels, scissors, newspaper, and bubble wrap. Why spend money on new cardboard boxes when there are likely unused boxes already lying around your home or at friends’ places? A visit to local recycling drop-off points may be in order, as it’s possible they’ll have free cardboard boxes available there, too.

Consider starting off your packing a few weeks ahead of time, with non-essential items like out-of-season clothes or kitchenware that’s rarely used. And consider taking photos of all valuable items as you go. This way, if anything breaks or movers damage something during the move, it will be easier to file a claim and receive reimbursement for it.

Tie Up Loose Ends

Moving to a new area? Consider making a list of everyone you’ll want to contact once you’re settled in your new place.This may include:

•   Friends and family members

•   U.S. Post Office

•   Employers

•   Credit card companies and other financial institutions

•   Service providers (e.g., water bill or internet)

If you’re hoping to keep utilities or services with a specific provider, it may help to call ahead of time to verify if those services are offered in the area you’re moving to and if the service can be transferred to your new address on or after move-in day.

Keep in mind if you’re starting a new service with a new company, you may need to notify them weeks in advance so they have enough time to schedule a technician’s visit or mail out the necessary equipment.

If you’re leaving the region, you’ll also want to make a note to cancel recurring memberships at local-only businesses, such as gyms and fitness centers.

Organize Moving Documents

From leases to service contracts to quotes from moving companies, there’s a lot of paperwork to manage with a move. It can help to keep all important documents organized in a single folder (and be sure to print out a copy of any documents sent to you electronically). Some paperwork to include in the moving folder could be:

•   Old leasing agreements

•   A new signed lease (if renting again)

•   Invoices from professional movers

•   Receipts associated with the move

The paperwork may even come in handy after you move. Members of the U.S. Armed Services may be able to deduct moving expenses, for example. And some companies will reimburse employees who are moving to accept a new job for common moving expenses. Talk to your human resources department to find out if you qualify and which receipts or invoices will be required for documentation.

Prepare a Tip for the Movers

For those who plan to hire professional movers, setting aside cash in an envelope could help when it comes time to tip. Often, people tip their movers if they’re happy with the job they completed. Taking out cash the day before a move can simplify tipping, as it’s one less thing to think about during moving day.

Recommended: The Ultimate Moving Checklist

Common Moving Expenses

When budgeting for a move, it can be useful to plan for expenses that can add up quickly.

Understanding Professional Moving Costs

If you’re moving yourself, plan on paying an average of $50 per day to rent the truck, and budget more for mileage, gas, tolls, and other expenses.

If you’re hiring professionals for the job, you can expect to pay quite a bit more. An in-town move that uses a team of two movers could cost an average of $80 to $100 per hour, according to Consumer Affairs. Moving to another state? Be prepared to spend upwards of $5,000 or more, depending on how far you’re going and the amount of stuff you’re hauling.

You may also want to consider whether to budget for packing services, which typically runs anywhere from $300 to $500, and moving insurance, which protects you in case your items are lost or damaged during the move.

If you’re looking to save a little money — and your schedule is flexible — you may want to look into moving during the middle of the week or middle of the month, when demand tends to be lower.

Estimating Transportation Costs

In addition to budgeting for the cost of moving your things, it’s good to calculate the expense of transporting yourself to your new home. Be sure to factor in expenses such as flights, lodging, food, rental car, and gas.

Other Supplies and Expenses

You might already be loading up on bubble wrap, packing tape, boxes, and labels. But there may be other moving-day essentials to consider.

1.    Cleaning supplies: Many landlords expect outgoing tenants to leave a property just as they found it: clean and empty. Be sure you have a mop, broom, cleaners, and sponges on hand.

2.    Repairs and renovations: Whether you’re patching holes in your old place or making upgrades in your new home, consider budgeting for any renovations or repairs.

3.    Furniture and other home items: You may find that when you move into your new space, you need to buy some new furniture. You may want to set aside a little extra for these purchases.

4.    New license and vehicle registration: If you’re moving across the country, you may need to calculate the cost of getting a new driver’s license and registration in a different state. Fees for getting a new license and vehicle registration vary by state.

Recommended: Things to Budget for After Buying a Home

The Takeaway

Whether you’re relocating across town or across the country, moving can be exciting. But it can also be stressful and expensive. To help streamline the process, you can remove and donate any unwanted items, assemble your supplies and the movers’ tip ahead of time, organize all the moving documents in one place, and alert family, friends, employers, and creditors of your new address.

It also helps to prepare your budget. A DIY move is often the most affordable option — on average, it costs around $50 per day to rent a truck, which does not include mileage, gas, tolls, and other expenses. A professional mover costs substantially more. An in-town move that uses a two-person team may cost around $80 to $100 per hour, but that price could climb into the thousands for an interstate move.

Think twice before turning to high-interest credit cards. Consider a SoFi personal loan instead. SoFi offers competitive fixed rates and same-day funding. See your rate in minutes.

About the author

Ashley Kilroy

Ashley Kilroy is a seasoned personal finance writer with 15 years of experience simplifying complex concepts for individuals seeking financial security. Her expertise has shined through in well-known publications like Rolling Stone, Forbes, SmartAsset, and Money Talks News. Read full bio.

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Money pools provide a platform for friends, relatives, or colleagues to combine their savings. The purpose of this arrangement is to leverage each member’s financial resources to save money, reach short-term money goals, or create financial security.

While money pools gained popularity centuries ago in developing countries, such as India and Southern Africa, they have continued to provide a banking solution for migrant communities in the U.S. Here’s a look at how money pools work and how they benefit folks that don’t have access to traditional banking products like savings accounts.

Read on to learn:

•   What is a money pool?

•   How do money pools work?

•   What are the pros and cons of money pools?

What Is a Money Pool?

So, what are money pools exactly?

A money pool is when a group of individuals (friends, family members, neighbors, or coworkers) combine their savings into one pot. The group decides on a monthly contribution amount they will each put into the pool.

Then, every month, one person from the group will receive the total sum of the money pool to do as they wish. The group can either draw names to decide who gets the money or make an arrangement based on a mutual understanding. Funds are distributed monthly until the entire pool is depleted. In this way, it’s somewhat akin to peer-to-peer lending.

However, money pools don’t just happen; they must have a responsible party that organizes the group. The money pool organizer tackles tasks such as collecting the money, tracking contributions, and planning distributions. The organizer keeps order, so each member understands and adheres to the group’s guidelines.

Money pools mainly exist in developing countries, with minimal access to credit or banking solutions like savings accounts. However, many U.S. immigrant communities nationwide use money pools as a solution for helping people within the community pay bills or save for financial goals. It can also serve as an example of pay-it-forward finance and helping those close to you.

Recommended: Short-Term Financial Goals to Set for Yourself

How Do Money Pools Work?

A money pool works like this: Let’s say a group of three friends decide to create a money pool. They decide that they will contribute $400 per month creating a $1,200 money pool. Each month, one friend from the group will receive $1,200. No matter who receives the funds for the month, every person in the group continues to contribute so the money pool amount always has $1,200 in it.

A money pool provides an immediate source of funds for someone needing to pay for unexpected expenses. In other words, the money pool can act as an interest-free loan to pay off medical expenses you can’t afford, car repairs, or tuition costs. A money pool can also provide a forced savings method for the last person who receives the funds.

The organizer usually determines who should receive the funds first. They may consider financial needs to assess the arrangement of the distribution of funds.

Reasons Why People Use Money Pools

For centuries, people have been using money pools around the world as an alternative to traditional savings solutions. However, folks are more likely to use money pools if they have:

•   Limited or no access to traditional banking institutions.

•   A bad credit score that making it challenging to qualify for financing.

•   Minimal financial resources; the money pool can be a way to save money with a low income.

•   The need to borrow or save money.

Examples of Money Pools

Money pools exist around the world and often go by various names. In U.S., Americans usually refer to this type of arrangement as a money pool or rotating savings and credit association (ROSCA).

Different communities call money pools by different names. Some examples of other names for money pools are:

•   Tandas in south and central Mexican communities

•   Cundinas between northern Mexico and Washington state

•   Susus in the Caribbean

•   Pandeiros in Brazil

•   Hui in Asia

•   Arisan in Indonesia

•   Ayuuto in Somalia

Recommended: Creative Ways to Save Money

How to Determine if You Should Join a Money Pool

If a money pool piques your interest, consider a few key points before moving forward with this financial decision.

•   Affordability of recurring payments. Make sure you can afford and have the money discipline to contribute the recurring payment amounts. A money pool isn’t like a traditional savings account where you can pull money out whenever you want. Think carefully to be sure that contributing won’t put you in a financial bind.

•   Trustworthiness of key members. You may feel uncomfortable contributing to a money pool with a group of members you don’t know well. Instead, consider creating a money pool with people you know and trust.

•   Organization of the money pool. Someone must be the organizer if you establish your own money pool. Money pool apps are available to help you organize your group and streamline contributions and distributions.

If you’re still on the fence, you may want to explore Community Development Financial Institutions or CDFIs as an alternative solution. What is a CDFI? These financial institutions cater to underserved communities. In addition, CDFIs offer banking products such as checking accounts to those who may have been turned away by traditional banking institutions. So, if you have a low credit score or are struggling to find a suitable savings vehicle, CDFIs could be worth considering.

Pros of Money Pools

Money pools can be advantageous to consumers for the following reasons:

•   Provide access to cash. A money pool offers an alternative solution for accessing funds if individuals don’t have access to lending institutions.

•   Members instill accountability. The social pressure of accountability encourages the group members to adhere to the money pool commitment.

•   Interest-free loans. Money pools provide an interest-free way to pay for unexpected expenses like medical bills or car repairs.

Recommended: What Is a Lifeline Checking Account?

Cons of Money Pools

While money pools have benefits, they can also have some drawbacks, including:

•   Funds in the account are not interest-bearing. Members can grow their money in other interest-bearing accounts, like a high-yield saving account.

•   Members who don’t make payments put the group at financial risk. Members of the money pool could suffer a financial loss if someone doesn’t contribute when they are supposed to. This is especially true for the last member to receive the lump sum.

•   Risk of social disapproval. You must make an agreed-upon payment or you could be kicked out of the money pool and face social consequences such as being shunned from your community.

Recommended: Different Types of Savings Accounts

The Takeaway

Money pools allow a group of people to combine their savings while helping each other financially. Each member contributes to a fund of money, which is then disbursed to members sequentially, allowing every person involved to receive a lump sum of cash. While this type of savings vehicle is used in the U.S., it’s more prevalent in developing countries since financial resources are often limited.

3 Money Tips

1. Typically, checking accounts don’t earn interest. However, some accounts do, and online banks are more likely than brick-and-mortar banks to offer you the best rates.
2. If you’re faced with debt and wondering which kind to pay off first, it can be smart to prioritize high-interest debt first. For many people, this means their credit card debt; rates have recently been climbing into the double-digit range, so try to eliminate that ASAP.
3. When you feel the urge to buy something that isn’t in your budget, try the 30-day rule. Make a note of the item in your calendar for 30 days into the future. When the date rolls around, there’s a good chance the “gotta have it” feeling will have subsided.

FAQ

Is there a reason for developed countries to use money pools?

Yes, for communities with limited access to traditional banking and credit, money pools can offer a platform to help individuals achieve their financial goals.

Are money pools safe?

While there is a risk of members failing to contribute to a money pool, the peer pressure of the group usually ensures they will go to great lengths to make timely payments. So even though it’s possible, loss typically occurs only rarely.

Do money pools still exist?

Yes, money pools exist. You may find them in developing countries as well as the U.S.

About the author

Ashley Kilroy

Ashley Kilroy is a seasoned personal finance writer with 15 years of experience simplifying complex concepts for individuals seeking financial security. Her expertise has shined through in well-known publications like Rolling Stone, Forbes, SmartAsset, and Money Talks News. Read full bio.

Financial Tips & Strategies: The tips provided on this website are of a general nature and do not take into account your specific objectives, financial situation, and needs. You should always consider their appropriateness given your own circumstances.

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