Markus Andrews

The Social Security Fairness Act was signed into law on Jan. 5, following years of lobbying efforts from groups representing firefighters, police, teachers and other affected workers with pensions.
Yet one cohort, Social Security experts, is mostly unanimously against the changes the law brings.
Now, Social Security’s insolvency issues are worse while a solution is just as elusive, they say.

Richard Stephen | Istock | Getty Images

When President Joe Biden signed the Social Security Fairness Act on Jan. 5, it was a victory for those who tirelessly lobbied for years for new changes that will provide more generous benefits to public workers with pensions.
Yet for the policy community, the enacted change backed by overwhelming bipartisan support in both the House and Senate is a huge disappointment.

“Literally, you cannot find a Social Security expert who thought Social Security Fairness Act was a good idea,” said Andrew Biggs, senior fellow at the American Enterprise Institute.
The new law eliminates two provisions that adjusted Social Security benefits for individuals who also receive pension income from work performed in the public sector where payroll taxes to Social Security were not paid.
The now defunct Windfall Elimination Provision, or WEP, reduced Social Security benefits for approximately 2 million individuals who also have pension or disability benefits from work where they did not contribute to Social Security. The WEP was enacted in 1983.
The Government Pension Offset, or GPO, reduced Social Security benefits for nearly 750,000 spouses, widows and widowers who receive their own pensions from work in the public sector. The GPO was created in 1977.
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The provisions were intended to help ensure all Social Security beneficiaries get a comparable payout from the program. Because Social Security is progressive and intended to be an anti-poverty program, low-income workers receive a higher income replacement rate when they collect benefits. The WEP and GPO were intended to adjust public workers’ benefits so they were not treated as low-income workers.
Once the bill was signed, organizations that lobbied for the change praised the new law for finally providing affected workers the full Social Security benefits they had earned. For the National Committee to Preserve Social Security and Medicare, the new law caps off a decades-long fight to either modify or repeal the rules.
The WEP and GPO were “a way of cutting benefits for a class of people who are providing a public service for our communities,” said Maria Freese, senior legislative representative at the National Committee to Preserve Social Security and Medicare.
“They got singled out, and their Social Security earns them less in benefits than a person who decided not to go into public service,” Freese said.
As the new law is phased in, Social Security beneficiaries may see monthly benefit increases ranging from an average of $360 to $1,190, the Congressional Budget Office has estimated. Affected beneficiaries will also get lump-sum payments for the extra benefits they would have received throughout 2024.
The law makes the program “more fair” now that people will no longer be penalized for income earned outside of the system, said John Hatton, staff vice president for policy and programs at the National Active and Retired Federal Employees Association, or NARFE.
Notably, income from capital gains or inheritances already did not influence the size of Social Security benefits. The same should be true for income earned outside of the program, Hatton said.

Yet many policy experts maintain the changes never should have been enacted.
“What we saw was a huge special interest push for a very poorly developed and poorly targeted policy which is creating windfalls for a number of recipients,” said Maya MacGuineas, president of the bipartisan Committee for a Responsible Federal Budget.
Notably, that change will cost almost $200 billion over 10 years, according to the CBO, at a time when Social Security’s trust funds are already running low. The program’s combined trust funds are expected to last until 2035, at which point 83% of benefits will be payable, Social Security’s trustees projected last year. Eliminating the WEP and GPO will bring move that depletion date six months closer.
Experts both for and against the Social Security Fairness Act agree Congress needs to address the program’s funding shortfall sooner rather than later.

Provisions aimed to prevent benefit windfalls

The WEP and GPO rules, and how their intricacies affect individual beneficiaries, are complex.
“There is an injustice here that the provisions tried to correct, maybe not perfectly,” said Alicia Munnell, senior advisor at the Center for Retirement Research at Boston College.
Despite experts’ tireless efforts to explain the provisions to lawmakers, “we all failed,” Munnell said. Now what’s left is “bad policy,” she said.
Put simply, without the WEP, state and local workers who only work in jobs that pay into Social Security for a short time look like low earners and consequently get the extra benefits aimed at low earners, she said.
The elimination of the GPO also now makes it so a nonworking spousal Social Security benefit goes to a full-time worker with their own pension benefit, noted Charles Blahous, senior research strategist at George Mason University’s Mercatus Center.
“There’s zero justification for doing that,” said Blahous, who called the legislation “unserious” and “disappointing.”
While the WEP and GPO were imperfect, they were needed to prevent the payment of benefit windfalls to a small number of people who didn’t pay Social Security taxes for years, he said.
“It’s a very concerning indicator of Social Security’s future,” Blahous said.

Lawmakers face Social Security solvency dilemma

The Social Security Fairness Act was passed by the Senate with a 76-vote bipartisan majority. Amendments that were introduced in those final legislative hours in December — including efforts to add ways to pay for the change or alter the provisions instead of replacing them — failed. The Senate took up the bill after the House passed it in November with a 327 bipartisan majority.
Now that the WEP and GPO elimination has become law, one way to make the changes more equitable would be bring the 25% of state and local workers who do not currently contribute to Social Security into the program, according to Munnell.
While Congress could revisit the changes it just made with the Social Security Fairness Act, experts say that’s unlikely.
The bigger problem lawmakers now face is when and how to restore the program’s solvency.
“We are still in a place where politically it’s very difficult for members of Congress to come out in support of any substantive, responsible changes to the program that will address its long-term fiscal issues,” said Emerson Sprick, associate director of economic policy at the Bipartisan Policy Center.
Future action will require presidential leadership and a commitment to address the issue, Sprick said.

However, for now, President-elect Donald Trump has promised not to touch Social Security. Trump has also said he wants to eliminate taxes on Social Security benefit income. Trump’s presidential transition team did not immediately respond to a request for comment.
Because that change would be expensive, over $100 billion a year, and does not have the same fairness argument to it, it would be less likely to go through, according to Biggs.
While Trump has promised no benefit cuts, that creates a mathematical problem for Republicans, who are typically a low-tax party, he said.
Ultimately, restoring Social Security’s solvency may require benefit cuts, tax increases or a combination of both.
“We know that we need to be addressing Social Security and Medicare because of the insolvency that they both face within roughly a decade,” MacGuineas said. “Neither party, no leader, seems to have the political will or the integrity to start talking about how to get that done.” More

In his final days in office, President Joe Biden announced that his administration would forgive student debt for more than 150,000 borrowers.
That relief includes nearly 85,000 people who attended schools that “cheated and defrauded their students,” 61,000 borrowers with a total and permanent disability and another 6,100 public service workers, Biden said in a statement.

US President Joe Biden speaks about student loan debt relief at Madison Area Technical College in Madison, Wisconsin, April 8, 2024.
Andrew Caballero-Reynolds | AFP | Getty Images

In his final days in office, President Joe Biden announced that his administration would forgive student debt for more than 150,000 borrowers.
That relief includes will go to 85,000 people who attended schools that “cheated and defrauded their students,” 61,000 borrowers with a total and permanent disability, and another 6,100 public service workers, Biden said in a statement.

“Since Day One of my Administration, I promised to ensure higher education is a ticket to the middle class, not a barrier to opportunity, and I’m proud to say we have forgiven more student loan debt than any other administration in history,” Biden said.
Since Biden took office, he has forgiven debt for more than 5 million federal student loan borrowers, totaling $183.6 billion in relief.

In 2023, the Supreme Court blocked the president’s plan to deliver wide-scale student loan forgiveness for tens of millions of borrowers.
But the Biden administration still managed to wipe away a large share of the country’s outstanding student debt by improving the U.S. Department of Education’s existing debt relief programs.
Monday’s announcement is for $465 million in loan cancellation for public servants, $2.5 billion for borrowers with total and permanent disabilities, and more than $1.25 billion for defrauded students.

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If your federal student loans were forgiven in 2024, you may be wondering if there are any tax implications.
Many borrowers have benefited from education debt cancellation under the Biden administration. While in office so far, President Joe Biden cleared nearly $180 billion in federal student loans for 4.9 million people.
Here’s what to know about that relief come tax time.

Rhetoric & Writing Studies Major, Adamary Garcia studies inside of the Perry-Castaneda Library at the University of Texas at Austin on February 22, 2024 in Austin, Texas.
Brandon Bell  | Getty Images

If your federal student loans were forgiven in 2024, you may be wondering if there are any tax implications.
Many borrowers have benefited from education debt cancellation under the Biden administration. While in office so far, President Joe Biden has cleared nearly $180 billion in federal student loans for 4.9 million people. More than 1 million people had their debt cleared in 2024.

If you’ve had your debt excused last year, here’s what to know at tax time.

No federal taxes on relief through 2025

The American Rescue Plan Act of 2021 made student loan forgiveness tax-free at the federal level through the end of 2025, said higher education expert Mark Kantrowitz. That means you won’t owe anything to Uncle Sam on any federal education debt cleared throughout 2024.
It shouldn’t matter under what program the loans were forgiven, be it Public Service Loan Forgiveness, an income-driven repayment plan or Borrower Defense. The Biden administration has delivered most of its relief through one of those avenues.
(In case you aren’t familiar: PSLF leads to student debt erasure for certain public servants after a decade of qualifying payments. Meanwhile, IDR plans conclude in debt cancellation after a certain period of payments, typically 20 years or 25 years. And Borrower Defense wipes away the debt for students who’ve been defrauded by their schools.)
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Even canceled private student debt shouldn’t trigger a federal tax bill thanks to the terms of the American Rescue Plan, said Carolina Rodriguez, director of the Education Debt Consumer Assistance Program, based in New York. That law is set to expire Dec. 31, 2025.
Meanwhile, student debt excused in bankruptcy should never be subject to federal or state taxes, Kantrowitz added.

You could owe taxes to your state

Despite the current federal policy on forgiven student debt, it’s possible a borrower could still face state taxes.
Currently, a handful of states tax certain kinds of student loan forgiveness, Kantrowitz said. That could be because their state tax code doesn’t conform to the federal one or hasn’t been updated to reflect the American Rescue Plan.

You’ll want to check with your state or a tax professional to learn if your relief triggers any liability.
Many states mirror their student loan forgiveness tax policy on the federal government. As a result, if the American Rescue Plan’s provision expires, more states could levy the forgiven debt again, too.

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An Uber rideshare sign is posted nearby as taxis wait to pick up passengers at Los Angeles International Airport (LAX) on February 8, 2023 in Los Angeles, California.
Mario Tama | Getty Images

The new year has only just started, but macro uncertainty is already hanging over investors, with Federal Reserve officials raising concerns over inflation and its impact on the rate-cutting path.
In these shaky times, investors can enhance their portfolio returns by adding stocks backed by solid financials and long-term growth opportunities. The investment thesis of top Wall Street analysts can inform investors as they pick the right stocks, as pros base their analysis on a strong understanding of the macro environment and company-specific factors.

Here are three stocks favored by the Street’s top pros, according to TipRanks, a platform that ranks analysts based on their performance.

Uber Technologies

We start with ride-sharing and food delivery platform Uber Technologies (UBER). The company delivered better-than-expected revenue and earnings for the third quarter of 2024, though gross bookings fell short of expectations.
Recently, Mizuho analyst James Lee reiterated a buy rating on Uber Technologies stock with a price target of $90. The analyst sees 2025 as a year of investment for UBER. While these investments could impact the company’s earnings before interest, taxes, depreciation and amortization over the near term, they are expected to fuel long-term growth.
Based on his analysis, Lee expects Uber’s growth investments to drive a compound annual growth rate of 16% in core gross bookings from FY23 to FY26, in line with the company’s analyst-day target of mid- to high-teens growth. The analyst is confident that Uber’s EBITDA growth is on track with its analyst-day target of high-30s to 40% CAGR. “Despite leaning into growth investments, economies of scale and increased efficiency should offset margin risks,” said Lee.
Additionally, Lee thinks that worries over the growth of the company’s Mobility business seem overstated. The analyst expects FY25 gross bookings growth (forex neutral) in the high-teens, with the pace of deceleration moderating compared to the second half of 2024.

Further, the analyst projects the gross bookings for Uber’s Delivery business to remain in the mid-teens in FY25. This increase is expected to be supported by the growing adoption of new verticals while maintaining the food delivery market share. The analyst added that Mizuho’s checks revealed that order frequency has reached another all-time high. Checks also indicate solid grocery adoption in the U.S., Canada and Mexico along with robust user penetration.
Lee ranks No. 324 among more than 9,200 analysts tracked by TipRanks. His ratings have been profitable 60% of the time, delivering an average return of 12.9%. See Uber Technologies Stock Charts on TipRanks.

Datadog

We move to Datadog (DDOG), a company that offers cloud monitoring and security products. In November, the company announced better-than-anticipated results for the third quarter of 2024.
On Jan. 6, Monness analyst Brian White reiterated a buy rating on Datadog stock with a price target of $155. The analyst thinks that the company has a more balanced approach toward the generative artificial intelligence trend, “avoiding the absurd claims propagated by many across the software complex.” He noted that DDOG fared well compared to its peers in a challenging software backdrop in 2024, but added that it lagged behind other stocks in Monness’ coverage universe.
That said, White thinks that Datadog, and the broader industry, will start to see incremental activity over the next 12 to 18 months from the long-term boom in generative AI. Highlighting DDOG’s outperformance compared to peers and its transparency with regard to its generative AI progress, the analyst noted that AI-native customers accounted for more than 6% of the company’s annual recurring revenue (ARR) in Q3 2024, up from over 4% in Q2 2024 and 2.5% in Q3 2023.
White also highlighted some of the company’s AI offerings, including LLM Observability and its gen AI assistant, Bits AI. Overall, the analyst is bullish on Datadog and thinks that the stock deserves a premium valuation compared to traditional software vendors due to its cloud-native platform, rapid growth and robust secular tailwinds in the observability space, as well as its new generative AI-led growth opportunities.
White ranks No. 33 among more than 9,200 analysts tracked by TipRanks. His ratings have been profitable 69% of the time, delivering an average return of 20%. See Datadog Ownership Structure on TipRanks.

Nvidia

Semiconductor giant Nvidia (NVDA) is this week’s third stock pick. The company is considered one of the major beneficiaries of the generative AI wave and is experiencing stellar demand for its advanced GPUs (graphics processing units) that are required to build and run AI models.
Following a fireside chat with Nvidia’s CFO Colette Kress, JPMorgan analyst Harlan Sur reaffirmed a buy rating on the stock with a price target of $170. The analyst highlighted the CFO’s assurance that the ramp-up in the production of the company’s Blackwell platform is on track despite supply chain challenges, thanks to solid execution.
Moreover, the company expects spending in the data center space to remain strong in calendar year 2025, supported by the Blackwell ramp-up and broad-based strength in demand. Further, Sur noted that management sees massive revenue growth opportunities, as it grabs a larger chunk of the $1 trillion-worth datacenter infrastructure installed base.
Sur added that Nvidia expects to benefit from the shift to accelerated computing and growing demand for AI solutions. Management thinks that the company has a solid competitive advantage compared to ASIC (application-specific integrated circuit) solutions due to several strengths, including ease of adoption and its comprehensive system solutions.
Agreeing with this viewpoint, Sur said, “We believe that enterprise, vertical markets, and sovereign customers, will continue to prefer Nvidia-based solutions.”
Among the other key takeaways, Sur highlighted the rollout of next-generation gaming products and opportunities to expand beyond high-end gaming into markets like AI PCs. 
Sur ranks No. 35 among more than 9,200 analysts tracked by TipRanks. His ratings have been profitable 67% of the time, delivering an average return of 26.9%. See Nvidia Hedge Funds Activity on TipRanks. More

A flight engineer performs a test flight in a CAE Inc. 7000 Series Boeing Co. 737-800 flight simulator at a CAE facility in Montreal, Quebec, Canada, on Tuesday, Aug. 13, 2019.
Christinne Muschi | Bloomberg | Getty Images

Company: CAE Inc (CAE)

Business: CAE provides simulation training and critical operations support solutions in Canada, the United States, the United Kingdom, Europe, Asia, the Oceania, Africa and the rest of the Americas. It operates through two segments: Civil Aviation, and Defense and Security. The Civil Aviation segment offers training solutions for flight, cabin, maintenance and ground personnel in commercial, business and helicopter aviation. It also provides a range of flight simulation training devices and ab initio pilot training and crew sourcing services, as well as aircraft flight operations solutions. The Defense and Security segment operates as a training and simulation provider that delivers platform-independent solutions to enable and enhance force readiness and security for defense forces, original equipment manufacturers (OEMs), government agencies and public safety organizations.
Stock Market Value: $7.56B ($23.73 per share)

Stock chart icon

CAE shares over the past 12 months

Activist: Browning West LP

Ownership: 4.3%
Average Cost: n/a
Activist Commentary: Browning West is an independent investment partnership based in Los Angeles, California and founded in 2019. The partnership employs a concentrated (five to 10 investments), long-term and fundamental approach to investing. It focuses primarily on investments in North America and Western Europe. The firm does not use activism in all of its portfolio positions, but when it does, it’s almost always focused on leadership at the board and CEO level. Browning West wants to make sure that it has confidence in the people who are making the decisions with its capital and assure that management’s interests are aligned with shareholders.

What’s happening

On Dec. 20, 2024, Browning West sent a letter calling on CAE’s board to collaborate with the firm in the recruitment process for a new CEO.

Behind the scenes

CAE Inc. is a Canadian multinational company specializing in flight training and simulation technologies. The company operates through two segments: Civil Aviation and Defense and Security. Civil Aviation provides comprehensive training solutions for personnel in commercial, business and helicopter aviation, as well as manufacturing flight simulation training devices. Defense and Security provides similar solutions, but to defense forces, government agencies and other related end markets. CAE is the market leader in both manufacturing highly valuable flight simulators and operating training facilities for flight safety. The company also sells its valuable technology to customers who conduct their own independent training of flight personnel.

CAE maintains an enviable position within an attractive and growing industry. It is the largest player in its market and at least double the size of its next largest competitor, aptly named FlightSafety International, a business which is owned by Berkshire Hathaway. Any business with Warren Buffett’s stamp of approval is certainly an indication of a favorable mix of growth and value. It is hard to think of another industry where the growth rate is so certain. Annual global flight miles typically grow in the mid-single digits and there is a tremendous long-term opportunity for growth. As flight volumes continue to grow, that means more aircraft, more pilots, more personnel, and, of course, more simulators and more training.
Still, CAE has underperformed in the past five years, delivering a return of -8.75% versus a nearly 101.78% return for the five years prior. When the company reported its FY24 results in March 2024, it missed analysts’ full-year expectations for revenue by about 5% and EPS by 4%. In addition, the company reported an operating loss of $185 million in Canadian dollars after putting up C$466 million the year prior. A hefty portion of the loss came from a C$568 million non-cash impairment of Defense and Security goodwill and C$90.3 million in unfavorable contract profit adjustments due to accelerated risk recognition on certain legacy contracts. On Nov. 12, 2024, CAE announced that its longtime president and CEO Marc Parent would resign from his post at the company’s next annual meeting in August 2025 as a part of CAE’s ongoing succession plan.
This is where things get very interesting for an activist investor: a market leader in a secularly growing industry where the activist could potentially be in the room to name the next CEO. And this is the type of shareholder activism that Browning West focuses on: leadership changes. Accordingly, Browning West LP sent an open letter to the board of CAE. In a succinct letter, the firm speaks highly of CAE’s strong market position, points out the company’s recent prolonged period of underperformance, but affirmed its conviction in CAE’s ability to grow earnings per share and free cash flow per share well exceeding current market expectations. However, Browning West has requested that the board engage with it regarding the recruitment of CAE’s next CEO, believing that the board must avoid a hasty CEO search process and instead work to recruit a proven CEO with a verifiable track record of value creation. Browning West and its principals have an admirable history of assisting in CEO succession at its portfolio companies. In May 2024, Browning West reconstituted the entire board of Gildan Activewear over the board’s decision to remove that company’s long-time CEO and co-founder Glenn Chamandy. Since the reinstatement of Chamandy as CEO about eight months ago, Gildan’s shares have appreciated nearly 30%. In addition, Browning West co-founder and CIO Usman Nabi, gained extensive experience from his time at H Partners conducting CEO searches. Between H Partners and Browning West, he has served on and/or led nomination and CEO search committees at both Tempur Sealy and Six Flags. H Partners generated a return of 242% over the course of its 13D at Tempur Sealy versus 99% for the Russell 2000 and a return of 399% over the course of its live 13D at Six Flags versus 285.71% for the Russell 2000.
Given that Browning West even had to issue this public letter, we can infer that perhaps CAE’s board has not been overly receptive or made itself profoundly available for inbound communication requests from Browning West to participate in the search process. Browning West does not frequently get confrontational, but when it does, it’s very good at doing so. The firm picks battles that it can win. In early 2024, Browning West requisitioned a special meeting at Gildan Activewear which resulted in the resignation of that company’s entire board and the appointment of their eight-member slate (which included Browning West co-founder Peter Lee). Previously, at H Partners, Usman Nabi was able to reconstitute the board at Tempur Sealy and replace the CEO with nothing more than a withhold vote campaign, an unprecedented move in activism at the time. Browning West has also engaged with companies where the firm was invited on to the board such as Six Flags and Domino’s. We would advise CAE’s board to look at this as an opportunity as opposed to an attack. If the board decides to fight, it could ignore Browning West while commencing and consummating its CEO succession plan without any input from the activist investor before the company’s director nomination window opens next summer. But CAE’s board would be doing that at its own peril. Browning West is a long-term investor that does not opportunistically look for activism but finds a handful of companies it wants to own for the long term, and the firm will do whatever is necessary to ensure that its capital is in the hands of the right stewards. CAE has a choice: It can embrace Browning West and the firm’s experience in CEO succession like other companies successfully have. Alternatively, the company can fight the investor, as other companies have done so unsuccessfully, and potentially face Gildan part deux. 
Ken Squire is the founder and president of 13D Monitor, an institutional research service on shareholder activism, and the founder and portfolio manager of the 13D Activist Fund, a mutual fund that invests in a portfolio of activist 13D investments. More

The 2025 tax filing season will begin on Jan. 27, which marks the first day the IRS will accept and process individual tax returns for 2024. 
Most taxpayers must file federal returns and pay taxes owed by April 15 this year to avoid penalties and interest. 
Taxpayers have several free filing options, including Direct File and IRS Free File, among others.  

Pra-chid | Istock | Getty Images

Expanded free filing options for 2025

For the 2025 season, Direct File, the IRS’ free tax filing program, will be open to eligible taxpayers in 25 states. That’s up from 12 states for the 2024 season.
This year, participating states include Alaska, Arizona, California, Connecticut, Florida, Idaho, Illinois, Kansas, Maine, Maryland, Massachusetts, Nevada, New Hampshire, New Jersey, New Mexico, New York, North Carolina, Oregon, Pennsylvania, South Dakota, Tennessee, Texas, Washington state, Wisconsin and Wyoming.
Meanwhile, IRS Free File, which offers free guided tax prep through software partners, opened on Jan. 10. Eligible taxpayers can electronically file returns prepared via Free File partners starting on Jan. 27.
Many are eligible for free tax preparation via programs like Volunteer Income Tax Assistance and Tax Counseling for the Elderly. Another free option for military members and certain veterans is MilTax. More

There are many undisputed health benefits associated with Dry January. There’s also an economic boost.
One expert estimates the savings for the monthlong endeavor could be between $300 and $1,000, depending on consumption.
For a growing number of adults, that’s a top motivator.

Ryanjlane | E+ | Getty Images

The start of a new year is the most popular time to make a resolution or two. For many, those include giving up alcohol for the first 31 days.
This year, 22% of adults are participating in Dry January, five percentage points higher than in previous years, according to a new report by Morning Consult.

“I don’t even want to call it a trend anymore because it has staying power,” said Lindsey Roeschke, author of the report.
Of those taking a break from beer, wine and mixed drinks, most were driven by the health benefits, the research found. Some adults may be particularly motivated by the U.S. Surgeon General’s recent warning that even small amounts of alcohol can cause cancer, Roeschke said. 
Forgoing alcohol entirely for a month has become a popular way to kick-start better habits. It’s credited for improved sleep, weight loss and overall wellbeing.
But the financial savings are also significant. 

How much money you can save

“Your exact savings during Dry January will hinge on your typical drinking patterns and related expenses,” said Douglas Boneparth, a certified financial planner and president and founder of Bone Fide Wealth, a wealth management firm based in New York.

“For some, skipping that occasional glass of wine might free up $50, while for those who regularly go out, the total could climb to $300 or more,” he said.
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Fred Harrington, the CEO of Coupon Mister, a site with money-saving tips, estimates that going entirely alcohol free for the month could save between $300 and $1,000, depending on consumption.
“The savings associated with cutting out alcohol for Dry January can be substantial,” Harrington said. “Even if you’re an occasional drinker, you’ll see a noticeable difference in your spending by giving up alcohol for a month.”
In fact, saving money was the third most popular reason for cutting out alcohol for the month, according to Morning Consult. Money as a top motivator “ticked up in 2022 when inflation reached its peak,” Roeschke said.

Tracking your baseline spending on alcohol is the best way to figure out how much you’ll save by going dry, advised Boneparth, who is also a member of CNBC’s Financial Advisor Council. The U.S. Department of Health and Human Services’ alcohol spending calculator can also show how much you are spending on alcohol every week, month or year.
A lot also depends on what you drink and where you live, Boneparth said. For example, a six-pack of beer from a grocery store might run $10 to $15, whereas a single cocktail at a bar could cost $12 to $18.
“Big-city bar prices are often higher than those in small towns and social habits — weekly happy hour, weekend outings — also play a huge role,” Boneparth said.

There could be an additional trickle-down effect from fewer rideshares or food orders and even less of a chance of drunk online shopping.
“It’s not just the money spent on the alcohol itself, it’s all of the ancillary things that come along with that,” said Morning Consult’s Roeschke.

How to put that savings to work

“You can put the money you save by doing Dry January to great use by, say, spending it on a health club membership, a new bike for exercise, savings or a holiday,” Harrington said.
Alternatively, that money could be well spent paying down post-holiday debt.
Most experts also recommend putting any extra cash in an emergency savings fund. Even a few hundred dollars can go a long way to providing a financial cushion when unexpected expenses arise. 
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The price growth for top drugs covered by Medicare Part D has exceeded inflation, according to a new AARP report.
The 25 drugs studied have increased by an average of 98%, or nearly doubled, since they entered the market.
The findings highlight the importance of allowing Medicare to negotiate drug prices, according to AARP.

Morsa Images | Digitalvision | Getty Images

List prices for the top 25 prescription drugs covered by Medicare Part D have nearly doubled, on average, since they were first brought to market, according to a new AARP report.
Moreover, that price growth has often exceeded the rate of inflation, according to the interest group, which represents Americans ages 50 and over.

The analysis comes as Medicare now has the ability to negotiate prescription drug costs after the Inflation Reduction Act was signed into law by President Joe Biden in 2022.
Notably, only certain drugs are eligible for those price negotiations.
The Biden administration in August released a list of the first 10 drugs to be included, which may prompt an estimated $6 billion in net savings for Medicare in 2026.
The Centers for Medicare & Medicaid Services is scheduled to announce by Feb. 1 the list of 15 Part D drugs selected for negotiation for 2027.

AARP studied the top 25 Part D drugs as of 2022 that are not currently subject to Medicare price negotiation. However, there is a “pretty strong likelihood” at least some of the drugs on that list may be selected in the second line of negotiation, according to Leigh Purvis, prescription drug policy principal at AARP.

Those 25 drugs have increased by an average of 98%, or nearly doubled, since they entered the market, the research found, with lifetime price increases ranging from 0% to 293%.
Price increases that took place after the drugs began selling on the market were responsible for a “substantial portion” of the current list prices, AARP found.
The top 25 treatments have been on the market for an average of 11 years, with timelines ranging from five to 28 years.
The findings highlight the importance of allowing Medicare to negotiate drug prices, as well as having a mechanism to discourage annual price increases, Purvis said. Under the Inflation Reduction Act, drug companies will also be penalized for price increases that exceed inflation.
Notably, a new $2,000 annual cap on out-of-pocket Part D prescription drug costs goes into effect this year. Beneficiaries will also have the option of spreading out those costs over the course of the year, rather than paying all at once. Insulin has also been capped at $35 per month for Medicare beneficiaries.
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Those caps help people who were previously spending upwards of $10,000 per year on their cost-sharing of Part D prescription drugs, according to Purvis.
“The fact that there’s now a limit is incredibly important for them, but then also really important for everyone,” Purvis said. “Because everyone is just one very expensive prescription away from needing that out-of-pocket cap.”
The new law also expands an extra help program for Part D beneficiaries with low incomes.
“We do hear about people having to choose between splitting their pills to make them last longer, or between groceries and filling a prescription,” said Natalie Kean, director of federal health advocacy at Justice in Aging.
“The pressure of costs and prescription drugs is real, and especially for people with low incomes, who are trying to just meet their day-to-day needs,” Kean said.
As the new changes go into effect, retirees should notice tangible differences when they’re filling their prescriptions, she said. More