Markus Andrews

The U.S. had 550 “million-dollar” cities, or areas where the typical home is worth more than $1 million, in February, according to a new analysis by Zillow.
The boost in high-value areas is a reflection of tight supply and high demand, according to Skylar Olsen, chief economist at Zillow.
Naples, Florida, boasts the most expensive home for sale in the U.S., which hit the market in February for $295 million.

Jon Lovette | Stone | Getty Images

There is a record number of areas in the U.S. where the “typical” home is worth $1 million or more.
In February, the country had 550 “million-dollar” cities, or areas where the “typical” home value is $1 million or more, according to a new analysis by Zillow. That is a gain of 59 cities from 2023, and edges out the previous record of 522 such cities when home values peaked in 2022.

The boost in million-dollar cities is a result of the mortgage lock-in effect, which deterred homeowners with extremely low rates from listing their properties for sale, said Skylar Olsen, chief economist at Zillow. The dynamic is keeping supply limited in some markets and elevating sale prices for those few available properties.

Some places have lost ‘million-dollar city’ status

California has the most million-dollar cities, with 210. That is 12 more than a year ago and more than the next five runner-up states — New York, New Jersey, Florida, Massachusetts and Colorado — combined, Zillow found.

Even though there are more million-dollar cities this year, the record amount is connected to how the lock-in effect is affecting an area’s supply, according to Olsen.
“The seller is as sensitive to the interest rate [as buyers],” she said.
Meanwhile, some areas lost the “million-dollar” status. In places where many homeowners already had interest rates between 6% and 7%, the lock-in effect is not as strong.
Such places are seeing an increase in supply with more sellers willing to put homes on the market, Olsen said.
“In those places where we’ve lost million-dollar cities … they’re not as locked in, and they have a lot more of that new construction that helps that picture, too,” she said.

Florida lost three million-dollar cities — Siesta Key, Santa Rosa Beach and Sanibel — while Texas lost Sunset Valley and Volente, two areas near Austin.
But it is hard to say if that is a trend, Channel said. Florida and Texas are both states that are still homes to high-cost, luxury markets, with 32 and 14 million-dollar cities, respectively, in February, per Zillow data.
Naples, Florida, also boasts the most expensive home for sale in the U.S., which hit the market in February for $295 million.

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Bank customers who have trust accounts may see their FDIC insurance coverage limits lowered due to new changes that went into effect April 1.
Here’s what you need to know to make sure your deposits are fully insured.

JGI/Jamie Grill

If you have more than $250,000 in deposits at a bank, you may want to check that all of your money is insured by the federal government.
The Federal Insurance Deposit Corporation, or FDIC, implemented new requirements for deposit insurance for trust accounts starting April 1.

While the FDIC’s move is intended to make insurance coverage rules for trust accounts simpler, it may push some depositors over FDIC limits, according to Ken Tumin, founder of DepositAccounts and senior industry analyst at LendingTree.

As part of its National Financial Literacy Month efforts, CNBC will be featuring stories throughout the month dedicated to helping people manage, grow and protect their money so they can truly live ambitiously.

The FDIC is an independent government agency that was created by Congress following the Great Depression to help restore confidence in U.S. banks.
FDIC insurance generally covers $250,000 per depositor, per bank, in each account ownership category.
If you have $250,000 or less deposited in a bank, the new changes will not affect you.

How FDIC coverage of trust accounts has changed

Under the new rules, trust deposits are now limited to $1.25 million in FDIC coverage per trust owner per insured depository institution.

Each beneficiary of the trust may have a $250,000 insurance limit for up to five beneficiaries. However, if there are more than five beneficiaries, the FDIC coverage limit for the trust account remains $1.25 million.
“For those who do go above $1.25 million under the old system, they definitely should be aware that changed,” Tumin said.

That may cause coverage reductions for certain investments that were established before these changes. For example, investors with certificates of deposit that are over the coverage limit may be locked into their investment if they do not want to pay a penalty for an early withdrawal.
“If you’re in that kind of shoes, you have to work with the bank, because you might not be able to close the account or change the account until it matures,” Tumin said.
The FDIC is also now combining two kinds of trusts — revocable and irrevocable — into one category.
Consequently, investors with $250,000 in a revocable trust and $250,000 in an irrevocable trust at the same bank may have their FDIC coverage reduced from $500,000 to $250,000, according to Tumin.
“That has the potential of causing loss of coverage, too,” Tumin said.

The agency is also revising requirements for informal revocable trusts, also known as payable on death accounts. Previously, those accounts had to be titled with a phrase such as “payable on death,” to access trust coverage limits. Now, the FDIC will no longer have that requirement and instead just require bank records to identify beneficiaries to be considered informal trusts.
“The bank no longer has to have POD in the account title or in their records as long as the beneficiaries are listed somewhere in the bank records,” Tumin said.
To amplify FDIC coverage beyond $250,000, depositors have several other options in addition to trust accounts.
That includes opening accounts at multiple FDIC-insured banks; opening a joint account for two people, which would bring the total coverage to $500,000; or opening accounts with different ownership categories, such as a single account and joint account.

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The IRS has released an “important update” for Direct File, the agency’s free tax filing program.
Direct File users can now automatically import key return verification details from the IRS, which has been the top mistake before filing, a Treasury official said.
The pilot is available for certain taxpayers in 12 states and will remain open for rejected returns until April 20.

D3sign | Moment | Getty Images

With one week until the April 15 federal tax deadline, the IRS has released an “important update” for Direct File, the agency’s free tax filing program.
Since March 12, the pilot program has been fully open for certain filers in 12 states, and Direct File now allows users to import key details needed to verify returns before filing.

When e-filing your taxes, you validate your return before filing by inputting the previous year’s adjusted gross income or the prior year’s temporary pin. Tax software typically adds this info for returning customers, but first-time users must add it manually.
This key step has been the main issue preventing Direct File returns from being successfully filed, according to a Treasury official.
But as of Monday, Direct File users can now import these verification details from the IRS, which could minimize the common error. Taxpayers can only access details from their own IRS account, which has identity verification, a Treasury official said.
More from Personal Finance:IRS free tax filing program launches in 12 pilot states19 million people may qualify for free tax prep through the IRSHow to pick the best free tax filing option this season”This important update will allow Direct File users to take advantage of information the IRS already has to simplify the filing process even further,” said Bridget Roberts, who leads Direct File at the IRS. 
Direct File will remain open for rejected returns until April 20, a Treasury official said.

Who qualifies for the Direct File pilot

Another common reason for abandoned Direct File returns has been tax situations not covered by the pilot, such as Forms 1099, according to a Treasury official.
“Direct File eligibility is limited to those with simple tax returns this filing season,” Deputy Secretary of the Treasury Wally Adeyemo said during a press call in March. “But a large percentage of Americans qualify.”
The IRS Direct File pilot states include Arizona, California, Florida, Massachusetts, Nevada, New Hampshire, New York, South Dakota, Tennessee, Texas, Washington and Wyoming.

The pilot will only accept Form W-2 wages, Social Security retirement income, unemployment earnings and interest of $1,500 or less. This excludes filers with contract income reported via Form 1099-NEC, gig economy workers or self-employed filers.
To qualify, you must claim the standard deduction, which is $13,850 for single filers and $27,700 for married couples filing jointly for 2023.
Direct File only accepts a few credits: the earned income tax credit, child tax credit and credit for other dependents. The software also accepts deductions for student loan interest and educator expenses.
In March, the Treasury Department estimated that one-third of federal income tax returns could use Direct File this season and 19 million taxpayers may currently be eligible.
The agency hopes to see 100,000 filings this season, a senior administrative official said in March. That works out to roughly 0.5% of those eligible filers. Roughly 60,000 taxpayers have used Direct File so far and the agency expects volume to increase ahead of the deadline, according to a Treasury official.

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President Joe Biden’s new plan to “cancel runaway interest” on student loans may reach as many as 25 million borrowers.
It is the provision that might prove to be the most wide-reaching of the president’s revised relief program, which he hopes will stand up to any legal challenges this time.

U.S. President Joe Biden speaks as he announces a new plan for federal student loan relief during a visit to Madison Area Technical College Truax Campus, in Madison, Wisconsin, U.S, April 8, 2024. 
Kevin Lamarque | Reuters

Interest provision may erase up to $20,000 per borrower

Consumer advocates have long criticized the fact that interest rates on federal student loans may exceed 8%, which can make it tough for borrowers who fall behind or are on certain payment plans to reduce their balances.
More than 25 million federal student borrowers owe more than they originally borrowed, according to the Biden administration.

It estimates that, if its new plan is enacted as proposed, borrowers will get up to $20,000 of unpaid interest on their federal student debt forgiven, regardless of their income.

Certain low- and middle-income borrowers may benefit even more.
Single people who earn $120,000 or less, and married borrowers making $240,000 or under, could have the entire amount of interest that has accrued on their debt since they entered repayment canceled under Biden’s plan.
Borrowers would need to be enrolled in an income-driven repayment plan to qualify but shouldn’t have to apply for the relief.
“Student debt interest capitalization has been keeping families from accessing their version of the American Dream,” said Jaylon Herbin, director of federal campaigns at the Center for Responsible Lending. “Erasing that debt will lessen the burden of student loan debt on millions of borrowers and allow them to pay off their loans in a timely manner.”

Who may benefit from new forgiveness plan

In addition to the cancellation of interest, Biden’s new plan is also expected to forgive the debt of certain groups of borrowers, including those who:

Are already eligible for debt cancellation under an existing government program but haven’t yet applied
Have been in repayment for 20 years or longer on their undergraduate loans, or over 25 years on their graduate loans
Attended schools of questionable value
Are experiencing financial hardship

It’s not entirely clear yet how financial hardship will be defined, but it could include those burdened by medical debt or high child care expenses, the Biden administration said.

Biden originally attempted to cancel people’s student debt through executive action, but he’s now turned to the rulemaking process. The next step in that procedure is for the Biden administration to issue a proposed rule on its plan, which will be followed by a public comment period.
The president hopes to begin forgiving student debt before the November election. More

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President Joe Biden announced a new student loan forgiveness plan Monday, which could benefit as many as 30 million people, according to estimates.
Biden’s Plan B targets five specific groups of borrowers.
Here’s who could qualify for the new relief effort.

1. Borrowers with ‘runaway interest’

More than 25 million borrowers owe more than they originally borrowed in federal student loans because of accrued interest charges, according to the Biden administration.
As part of this plan, those borrowers could get up to $20,000 of unpaid interest on their debt forgiven, regardless of income. Certain low- and middle-income borrowers, if they’re enrolled in an income-driven repayment plan, could have the entire interest balance that has accrued on their federal loan debt since they entered repayment canceled.
Anyone enrolled in the Saving on a Valuable Education Plan, or SAVE, or any other income-driven repayment plan would be eligible without having to apply.

As part of its National Financial Literacy Month efforts, CNBC will be featuring stories throughout the month dedicated to helping people manage, grow and protect their money so they can truly live ambitiously.

2. Borrowers eligible for forgiveness programs, who haven’t applied

Consumer advocates and borrowers have complained that the government’s debt forgiveness programs can be hard to know about and to access.

Biden’s new plan is also expected to cancel debt for borrowers who are otherwise eligible for relief through Public Service Loan Forgiveness or SAVE or other income-driven repayment plans, but have not successfully applied.
The Department of Education will review the accounts of borrowers to identify who could be eligible for this type of relief, which would go into effect automatically, the administration said.

3. Borrowers who entered repayment over 20 years ago

Another 2.5 million borrowers would benefit from the forgiveness of student loans that have been held for two decades or longer.
Borrowers with undergraduate debt would qualify for forgiveness if they first entered repayment on or before July 1, 2005, and borrowers with any graduate school debt would qualify if they first entered repayment on or before July 1, 2000, the administration said. Both direct loans and consolidated loans are eligible for relief. 

4. Borrowers who enrolled in ‘low-value’ colleges

Graduates with loans from “low-value” institutions or programs would also be eligible for loan forgiveness.
Under this part of the plan, borrowers who attended institutions or programs that closed or “failed to provide sufficient value” — meaning that graduates were left no better off than someone with a high school diploma — could apply for relief.
“Low-value” institutions are generally colleges that lost their eligibility to participate in the Federal Student Aid program or were denied recertification because they cheated or took advantage of students, according to the Biden administration.
Along these same guidelines, the Education Department has already canceled the student loans of more than 1 million students who attended certain for-profit schools, including Corinthian Colleges and ITT Technical Institute.

5.  Borrowers experiencing ‘hardship’

While harder to quantify, “millions of borrowers could be eligible for relief if they are experiencing hardship in their daily lives that prevent them from fully paying back their loans now or in the future,” the administration said. This piece of the plan would cancel student debt for borrowers who are at high risk of defaulting on their student loans or families burdened with other expenses like medical debt or child care.
With higher debt burdens, Black and Latino borrowers will benefit disproportionately from this relief, the White House also said.
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[This stream is set to start at 2:15 p.m. ET.]
President Joe Biden will announce on Monday the details of his new student loan forgiveness plan, which could affect tens of millions of Americans.

Immediately after the Supreme Court rejected Biden’s first attempt at wide-scale education debt cancellation, the president said he would seek to forgive the loans another way.
Despite its smaller scope than Biden’s first education debt relief plan, this new aid package could still lead to at least partial forgiveness for 25 million Americans, the Biden administration said.
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The plan, if enacted as proposed, would cancel up to $20,000 in unpaid interest for millions of borrowers.
In addition, the program is expected to forgive the debt of certain groups of borrowers, including those who:

Are already eligible for debt cancellation under an existing government program but have not yet applied
Have been in repayment for 20 years or longer on their undergraduate loans, or more than 25 years on their graduate loans
Attended schools of questionable value
Are experiencing financial hardship

The U.S. Department of Education could begin forgiving the debt as soon as this fall.

Student loan forgiveness and the presidential election

Biden wants to make good on his 2020 campaign promise to forgive student debt ahead of the November election.
Almost half of voters in a recent survey, or 48%, said canceling student loan debt is an important issue to them in the 2024 presidential and congressional elections. SocialSphere, a research and consulting firm, polled 3,812 registered voters, including 2,601 Gen Z and millennial respondents, in mid-March.
Forgiving student debt could especially help Biden with young voters, a demographic he has been struggling with. About 70% of Gen Z respondents said student debt cancellation was important to them in the election, that same survey found. More than half, or 53%, of respondents in that generation said they or someone in their household has student debt.

The issue is a chance for Biden to differentiate himself from his likely Republican opponent Donald Trump, who has a record of opposing debt relief for students.
While in office, the former president called for the elimination of the popular Public Service Loan Forgiveness program, signed into law by President George W. Bush in 2007. Trump also sided with the Supreme Court in its ruling to strike down Biden’s plan.
“Today, the Supreme Court also ruled that President Biden cannot wipe out hundreds of billions, perhaps trillions of dollars, in student loan debt, which would have been very unfair to the millions and millions of people who paid their debt through hard work and diligence; very unfair,” Trump said at a campaign event in June 2023.  More

YOUR GUIDE TO NAVIGATING YOUR FINANCIAL FUTURE

Problems with the new FAFSA have delayed financial aid award letters, making it harder for students to make informed decisions about next year ahead of enrollment deadlines.
In the meantime, applying for more private scholarships may help ease the burden of the cost of college.
This could also be an opportunity for college hopefuls to weigh their options before factoring in aid, according to Nancy Goodman, founder of College Money Matters.

Problems with the new Free Application for Federal Student Aid have left many students in a bind.
In an early April update, the U.S. Department of Education said the delivery of some FAFSA applications would be further delayed due to ongoing issues with applicants’ tax data.  

“We are working hard to address these challenges and ensure schools have the information needed to package and make aid offers as quickly as possible,” Rich Cordray, chief operating officer for the Education Department’s Office of Federal Student Aid, said in a statement. 
However, these latest setbacks may mean it will take colleges even longer to get financial aid award letters to students, shortening the time those college hopefuls have to make informed enrollment decisions about next year.

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Here’s a look at more stories on how to manage, grow and protect your money for the years ahead.

“Continually taking two steps forward and one giant step back is not a sustainable pathway toward getting financial aid offers out to students and families,” said Justin Draeger, president of the National Association of Student Financial Aid Administrators. 
In ordinary years, financial aid award letters are sent around the same time as admission letters, meaning students have several weeks to compare offers ahead of National College Decision Day on May 1, the deadline to decide on a college for most admitted students.
Higher education already costs more than most families can afford, and college costs are still rising. Tuition and fees, plus room and board, for a four-year private college averaged $56,190 in the 2023-2024 school year; at four-year, in-state public colleges, it was $24,030 per year, according to College Board.

Arrows pointing outwards

For most students and their families, the college they choose hinges on the amount of financial aid offered and the breakdown between grants, scholarships, work-study opportunities and student loans.
“For many of our students, it’s less about comparing offers and more about, ‘Can I go at all?'” said Charles Welch, president and CEO of the American Association of State Colleges and Universities.
To that end, the AASCU is encouraging colleges and universities to extend their decision deadlines to give students and families more time to assess their financial aid picture.
Some schools have already postponed those enrollment deadlines to May 15 or later.
“Our number one concern is making sure we give students every opportunity they can to make determinations about financial eligibility,” Welch said.

FAFSA delays don’t have to mean rushed decisions

This could also be an opportunity to weigh your options before factoring in aid, according to Nancy Goodman, founder of College Money Matters, a nonprofit focused on helping high school students and their families make informed decisions about paying for college.
“It’s not unexpected that people would feel the FAFSA delays are forcing them into a rushed decision about something that has a major financial impact on their lives,” she said. “But this waiting time can be an opportunity, because it gives students and their families the chance to step back and consider their options from a more clear, objective and unhurried point of view.”
Consider also your choice of major and future earnings potential, Goodman advised. Often, a good rule of thumb is not to borrow more than you expect to earn as a starting salary, other experts also say.
“This time is best used to objectively evaluate each school on the basis of how well they serve the student’s future — as opposed to how much aid they may offer in student loans,” Goodman said.
To determine which schools may be the more affordable options, the U.S. Department of Education’s college scorecard and each school’s net price calculator can help.

Tap private scholarships

In the meantime, students should also be exploring other sources of merit-based aid.
“I recommend being laser focused on applying for scholarships,” said James Lewis, co-founder of the National Society of High School Scholars.
In fact, there are more than 1.7 million private scholarships and fellowships available, often funded by foundations, corporations and other independent organizations, with a total value of more than $7.4 billion, Lewis explained.

Many don’t require a completed FAFSA, Lewis added, and there are free resources that can match you to available scholarships based on your skills and interests.
“There are students who have paid for their entire college education through scholarships, it’s just dependent on the amount of effort and time put in,” Lewis said.
Check with the college or ask your high school counselor about opportunities. You can also search websites like Scholarships.com and College Board.
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President Joe Biden will announce on Monday the details of his revised student loan forgiveness plan.
Although Biden’s Plan B will be narrower than his original effort, tens of millions of borrowers stand to benefit.

President Joe Biden on Feb. 21, 2024, visiting a library in Culver City, California.
Irfan Khan | Los Angeles Times | Getty Images

President Joe Biden will announce on Monday a new, sweeping student loan forgiveness plan, which could benefit tens of millions of Americans.
Biden will share the details of the aid package at an event in Madison, Wisconsin.

The news comes less than a year after the Supreme Court rejected his first attempt to cancel up to $20,000 in student debt per borrower. The conservative justices ruled that that effort was unconstitutional in June.
Although Biden’s Plan B for student loan forgiveness will be narrower than his initial effort, tens of millions of borrowers may still see their balances erased or lowered if the program survives legal challenges this time.
“These historic steps reflect President Biden’s determination that we cannot allow student debt to leave students worse off than before they went to college,” U.S. Undersecretary of Education James Kvaal said in a statement.
Kvaal added that Biden had directed the department “to complete these programs as quickly as possible, and we are going to do just that.”

Who may benefit from new forgiveness plan

Biden’s revised plan targets specific borrowers, including those who:

Are already eligible for debt cancellation under an existing government program but haven’t applied
Have been in repayment for 20 years or longer on their undergraduate loans, or over 25 years on their graduate loans
Attended schools of questionable value
Are experiencing financial hardship

It’s not entirely clear yet how financial hardship will be defined, but it could include those burdened by medical debt or high child care expenses, the Biden administration said.

The president is also expected to discuss a plan to “cancel runaway interest” for millions of borrowers.
Consumer advocates have long criticized the fact that interest rates on federal student loans may exceed 8%, which can make it tough for borrowers who fall behind or are on certain payment plans to reduce their balances. Some end up owing more than they originally borrowed, even after years of repayment.
The Biden administration estimates that, if its new plan is enacted as proposed, borrowers will get up to $20,000 of unpaid interest on their federal student debt forgiven, regardless of their income. Certain low- and middle-income borrowers could have the entire amount of interest that has accrued on their debt since they entered repayment canceled.

A narrower aid package Biden hopes will survive

The Biden administration believes its updated plan will survive legal challenges this time for several reasons.
In addition to the fact that this effort is a more targeted aid program, the Education Dept. is also using a different law — the Higher Education Act — as its legal justification. Biden’s initial forgiveness effort was based on the Heroes Act of 2003.
The HEA was signed into law by President Lyndon B. Johnson in 1965, and allows the education secretary some authority to waive or release borrowers’ education debt.
The Heroes Act was passed in the aftermath of the 9/11 terrorist attacks, and grants the president broad power to revise student loan programs during national emergencies. The Biden administration tried to use this law in its first forgiveness effort because at the time, the country was under a national emergency status from the Covid-19 pandemic.
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However, the conservative justices didn’t buy that argument.
“‘Can the Secretary use his powers to abolish $430 billion in student loans, completely canceling loan balances for 20 million borrowers, as a pandemic winds down to its end?'” Chief Justice John Roberts wrote in the majority opinion for Biden v. Nebraska. “We can’t believe the answer would be yes.”
Lastly, the Biden administration has now turned to the rulemaking process to deliver its relief. The president previously attempted to cancel the debt through executive action.

Student debt cancellation an important issue for voters

Biden likely wants to start forgiving student debt before voters cast their ballots in November.
Almost half of voters in a recent survey, or 48%, say canceling student loan debt is an important issue to them in the 2024 presidential and congressional elections. SocialSphere, a research and consulting firm, polled 3,812 registered voters, including 2,601 Gen Z and millennial respondents, in mid-March.

Forgiving student debt could especially help Biden with young voters, a demographic he’s been struggling with. Around 70% of Gen Z respondents said student debt cancellation was important to them in the election, that same survey found. More than half (53%) of respondents in that generation said they or someone in their household has student debts.
Biden’s plan is estimated to reach more than 30 million borrowers, when combined with his other ongoing debt forgiveness efforts, his administration said.
Mainly by improving current loan relief programs, the Biden administration has now cleared the education debts of 4 million people, totaling $146 billion in aid.
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