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YOUR GUIDE TO NAVIGATING YOUR FINANCIAL FUTURE

The second-quarter estimated tax deadline for 2024 is June 17 and you could trigger a penalty if you don’t send a payment.
Filers may owe estimated taxes with earnings from self-employment, gig economy work, small businesses, investments and more.
You can avoid late-payment penalties by sending 90% of 2024 taxes or 100% of your 2023 levies if your adjusted gross income is less than $150,000.

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The second-quarter estimated tax deadline for 2024 is June 17, and you could owe a penalty if you don’t send a payment, according to the IRS.
You typically owe estimated tax payments for income without withholdings, such as from contract jobs, freelancing or gig economy work, or if you run a small business.

But quarterly estimated tax payments are not just for the self-employed or small business owners, experts say.
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For example, you may need a quarterly payment after a large distribution from a pretax individual retirement account or a significant profit from selling an asset, according to certified financial planner Kelly Renner at Life Strategies Financial Partners in Augusta, Georgia.
You must make quarterly estimated tax payments if you expect to have at least $1,000 in tax liability or more on your 2024 return.
For the 2024 tax year, the estimated tax deadlines are April 15, June 17, Sept. 16 and Jan. 15, 2025. If you skip these deadlines, you could trigger an interest-based penalty calculated using the current interest rate and balance due.

Avoid a penalty by meeting the ‘safe harbor’ rules

It is possible to avoid penalties for missed estimated tax payments by meeting “safe harbor rules” from the IRS, explained Sheneya Wilson, a certified public accountant and founder of Fola Financial in New York.
You meet the safe harbor rules by paying at least 90% of the current year’s tax liability or 100% of last year’s taxes, whichever is smaller.
However, that threshold climbs to 110% if your adjusted gross income from 2023 was $150,000 or higher. You can find adjusted gross income on line 11 of Form 1040 from your 2023 tax return.

While the safe harbor protects from penalties, you could still owe taxes for 2024 if you earn more than 2023 and don’t make higher estimated payments.
If you are expecting “rapid income growth” for 2024, you should work with a tax professional for a “proper tax plan and projection,” Wilson said.

How to make quarterly estimated tax payments

The “most secure, fastest and easiest way” to make estimated tax payments is online, according to the IRS.
You can use your online account, IRS Direct Pay or the U.S. Department of the Treasury’s Electronic Federal Tax Payment System, or EFTPS.
“Every taxpayer should have an account with IRS.gov,” which makes it easy to make payments and reconcile transactions, Wilson explained.
However, if you prefer to mail payments, experts suggest using certified mail with a return receipt for proof of an on-time payment.

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More homeowners are listing their homes for sale.
But properties are taking longer to sell as potential buyers face high prices and interest rates.
Here’s what that means for homebuyers and sellers.

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More homeowners are listing their homes for sale, but properties are taking longer to sell as potential buyers face high prices and interest rates.
New listings from home sellers jumped in May, up 13% from a year ago, according to the latest market report by Zillow.

“You have an increase in sellers coming back on the market,” said Orphe Divounguy, a senior economist at Zillow.
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But with buyers not returning to the market, many new listings are just adding to inventory. The number of homes on the market rose 22% compared with last year, Zillow found.
“Homes are staying on the market for a bit longer because the sales are not keeping up with the flow of homes coming on the market,” Divounguy said.

‘The market is slowing down’

Almost two-thirds, or 61.9%, of homes listed on the market in May had been for sale for at least 30 days without going under contract, according to a new analysis by Redfin. About 40.1% of homes that were for sale in May had been listed for at least two months without going under contract, Redfin found.

“The market is slowing down. Homes are taking longer to sell and that allows inventory to accumulate on the market,” said Daryl Fairweather, chief economist at Redfin.

Yet despite the recent jump in supply, “we’re still starved for inventory in the for-sale market,” said Divounguy. The housing inventory in the U.S. is still 34% below pre-pandemic levels, according to Zillow.
“We’re short nationwide of about 4.3 million homes,” he said. “We’re still in a housing unit deficit.”

Homebuyers are waiting on lower mortgage rates

As mortgage rates have remained high and housing affordability has strained household finances, buyers have been unable to enter the market, Divounguy explained.
“Buyers are facing these incredibly high mortgage rates, at least relative to what they were during the pandemic,” said Fairweather, who believes homebuyers might lack the motivation and financial ability to purchase a home.
The 30-year fixed rate mortgage in the U.S. slid to 6.95% on June 13, lower from 6.99% a week prior, according to Freddie Mac data via the Federal Reserve. 

While mortgage rates could “change pretty quickly” or “on a dime,” said Fairweather, buyers are unlikely to see big movement in the near term. The Fed held rates steady at its June meeting and now anticipates just one rate cut this year. Its next meeting is July 30-31.
“There’s no right answer for homebuyers who are deciding whether to wait or not,” Fairweather said. “It’s just up to chance when mortgage rates drop. Nobody really knows when that will happen, so it’s hard to plan your life around that.”

What to do if you’re a buyer or a seller

Some markets in the U.S. are seeing a significant increase in unsold inventory. About 60.5% of listings in Dallas, Texas, stayed on the market for at least 30 days, up from 53% a year earlier, according to Redfin.
In Fort Lauderdale, Florida, the share of unsold listings that have stayed on the market for at least 30 days is 75.5%, up from 68.2% a year prior, Redfin found.
A similar increase is happening in two other areas in Florida. The share of unsold homes in Tampa that have been on the market for 30 days is 68.7%, up from 61.9% a year ago; in Jacksonville, 69.2%, up from 62.9% in the same period, per Redfin data.
“When you give buyers more options, that means they have more bargaining power,” Divounguy said.
If you notice homes for sale linger on the market for longer in your area, “there’s probably an opportunity to get [a property] for under its listed price,” Fairweather said.
If you make it into the home inspection process and you learn about issues that were neither noticeable during the initial walkthrough nor disclosed, it may be worth asking the home seller to do repairs, she said. 
But don’t overdo it: “You don’t want to be nit-picky and ask for every single repair,” such as chipped paint, Fairweather said. 

Other markets are still in favor of home sellers as inventory remains tight, Divounguy said. Not only do many homeowners have record home equity, they also have low mortgage payments.
If a home seller needs to move this year due to upcoming life changes and their area is experiencing high levels of unsold listings, they may need to be prepared to cut their asking price to draw interest.
“Price cuts sell homes,” he said. More

Deflation occurs when prices are falling for consumer goods and services. It’s the opposite of inflation.
Prices have deflated over the past year in some categories, according to the consumer price index.
The dynamic has largely occurred for physical goods such as furniture, cars and electronics. Prices for travel and for some groceries have fallen, too.

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Consumers saw prices for some goods and services deflate in May, amid a backdrop of broadly easing inflationary pressures.
Whereas inflation is a measure of how quickly consumer prices are rising, deflation is the opposite: It gauges how quickly they’re declining.

There are currently some “micro pockets” of deflation in the U.S. economy, said Joe Seydl, a senior markets economist at J.P. Morgan Private Bank.

In these pockets, there was an “extreme disconnect” between supply and demand during the Covid-19 pandemic that sent prices soaring, Seydl said. Prices are now normalizing as those dynamics unwind, he said.
However, Americans shouldn’t expect deflation across the broad U.S. economy, economists said.
“Consumers would love to have the prices they had back in 2019,” Seydl said. “But we very likely won’t see that, unless we have a major recession.”

Why prices are deflating for goods

Consumers have largely seen prices deflate for physical goods, such as cars, furniture and appliances, economists said.

For example, households have seen prices for furniture and bedding fall by 3.7% since May 2023, according to the consumer price index. Those for laundry equipment, dishes and flatware, and outdoor equipment and supplies are down 8.8%, 8.1% and 5%, respectively.

Prices have also fallen for new cars by 1.4% in the past year, while those for used cars and trucks decreased 9.3%. Vehicle prices were among the first to surge when the economy reopened broadly early in 2021, amid a shortage of semiconductor chips essential for manufacturing.
Demand for physical goods soared in the early days of the Covid pandemic as consumers were confined to their homes and couldn’t spend on things such as concerts, travel or dining out.
“A lot of that funding found itself in new cars and home renovations,” said Michael Pugliese, a senior economist at Wells Fargo Economics.
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The health crisis also snarled global supply chains, meaning goods weren’t hitting the shelves as quickly as consumers wanted them.
Such supply-and-demand dynamics drove up prices.
Now, however, they’ve fallen back to earth. The initial pandemic-era craze of consumers fixing up their homes and upgrading their home offices has diminished, cooling prices. Supply-chain issues have also largely unwound, economists said.
Overall physical goods prices, excluding food and energy commodities, have deflated in all but one month since May 2023, for example, according to Bureau of Labor Statistics data. Goods prices are down 1.7% over the past year.

The U.S. dollar’s strength relative to other global currencies has also helped rein in prices for goods, economists said. This makes it less expensive for U.S. companies to import items from overseas, since the dollar can buy more.
The Nominal Broad U.S. Dollar Index is higher than at any pre-pandemic point dating to at least 2006, according to Federal Reserve data. The index gauges the dollar’s appreciation relative to currencies of the nation’s main trading partners such as the euro, the Canadian dollar and the Japanese yen.

Deflation for groceries, travel and electronics

Prices have also declined in the past year for some non-goods items.
For example, grocery prices have fallen for items such as ham, rice, fresh fish and seafood, milk, potatoes, coffee, margarine and cheese. Notably, consumers have seen apple prices fall 13.2% in the past year amid burgeoning supply.
Each grocery item has unique supply-and-demand dynamics that can influence pricing, economists said. Egg prices, for example, spiked in 2022 due largely to a historic and deadly outbreak of bird flu and have since fallen.

Travelers have also seen deflation for airline fares, down 5.9%, hotel rates, down 1.7%, and car rental rates, down 8.8%, since May 2023. For example, airlines have increased the volume of available seats for travelers by flying larger planes on domestic routes, which has helped push down prices, Hayley Berg, lead economist at travel site Hopper, wrote recently.
Additionally, evidence suggests “consumers are becoming a bit more price sensitive,” said Olivia Cross, a North America economist at Capital Economics.
That behavior is a gut check for retailers, who may find they need to offer more competitive prices to attract customers, she said.

Elsewhere, some deflationary dynamics may be happening only on paper.
For example, in the CPI data, the Bureau of Labor Statistics controls for quality improvements over time. Electronics such as televisions, cellphones and computers continually get better, meaning consumers generally get more for the same amount of money.
That shows up as a price decline in the CPI data. More

President Joe Biden’s top economic advisor on Thursday unveiled plans to address the battle over trillions of dollars in expiring tax breaks enacted by former President Donald Trump.
After 2025, several provisions from the Tax Cuts and Jobs Act, or TCJA, of 2017 will expire without action from Congress, which could increase taxes for more than 60% of filers.
White House National Economic Advisor Lael Brainard unveiled Biden’s “key principles” for the multitrillion-dollar tax debate.

Director of the National Economic Council Lael Brainard speaks at the White House in Washington, D.C., on Jan. 11, 2024.
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President Joe Biden’s top economic advisor on Thursday unveiled plans to address trillions of dollars in expiring tax breaks enacted by former President Donald Trump.
After 2025, several provisions from the Tax Cuts and Jobs Act, or TCJA, of 2017 will expire without action from Congress, which could increase taxes for more than 60% of filers, according to the Tax Foundation.

Some expiring individual provisions include lower federal income tax brackets, a higher standard deduction, a more generous child tax credit and doubled estate and gift tax exemption, among others.
“President Biden plans to extend tax cuts for hardworking Americans by making sure the wealthiest and big corporations pay their fair share,” White House National Economic Advisor Lael Brainard told reporters Wednesday evening during a press call.
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Biden will follow “key principles” to support middle-class and working families as the 2025 tax cliff approaches, Brainard said.
Expiring TCJA provisions could affect all Americans, but Brainard reaffirmed Biden’s pledge to extend tax breaks only for those making less than $400,000. Aiming to raise revenue for his “commitment to seniors and fiscal responsibility,” Biden would allow TCJA provisions to expire for those making more than $400,000, Brainard said.

By comparison, former President Donald Trump has said he plans to extend all expiring TCJA provisions.

Fully extending TCJA provisions could add an estimated $4.6 trillion to the deficit over the next decade, according to the Congressional Budget Office.
Trump hasn’t released specific plans on how to fund expiring TCJA provisions but has voiced support for tariffs, which are taxes levied on imported goods from another country.In a statement, Trump campaign National Press Secretary Karoline Leavitt said Trump was proud to have passed the TCJA and if reelected would “advocate for more tax cuts for all Americans.”

While the TCJA permanently reduced the top federal corporate tax rate from 35% to 21%, Biden aims to raise corporate taxes and implement a global minimum tax, according to Brainard.
The plan also called for sustained IRS funding, which has been targeted by Republicans since Congress approved nearly $80 billion in funding via the Inflation Reduction Act.

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Roughly 1 in 5 (19%) of homeowners found the cost of home improvement projects to be the most surprising element in the first six months of homeownership, according to a new report by home services site Angi.
Annual “hidden costs” of homeownership average around $18,000 nationwide, according to a separate report by Bankrate.com.
Here are ways buyers can prepare and potentially reduce unexpected costs.

Senior couple repairing kitchen cabinet at home
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Alex Marrero and his wife bought their first home this spring in Coral Springs, Florida — and the couple has already spent nearly $17,000 on home maintenance, repairs and installations. 
While they knew they needed to do improvements from “the minute they bought the house,” Marrero said, some were more expensive than anticipated.

For example, he estimated four hurricane impact-resistant windows and a garage door would cost between $4,000 to $5,000. But after multiple quotes from contractors, he ended up paying $9,800.
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Since their mid-April home purchase, the couple also hired contractors to refinish their scratched-up wood floors for a total $2,200; installed a pool safety fence for $1,673; removed popcorn finishing from the garage ceiling for $800; had someone prime and paint ceiling texture for $650; and replaced cracked roof tiles for $1,670.
“We’re still kind of anticipating more expenses,” said Marrero, 33. “I know the pool pump is on its last leg. So, we’re bracing.”

‘Understanding that process is enlightening’

Marrero’s experience isn’t unique.

Experts say the “hidden costs” of owning a home, especially repairs and maintenance, can come as a shock for homeowners.
Roughly 1 in 5 (19%) of homeowners found the cost of home improvement projects to be the most surprising element in the first six months of homeownership, according to a new report by Angi, an online marketplace that connects homeowners with professional contractors for home maintenance or renovations. In late May, the site polled a total of 1,000 Americans who bought a home in the past five years. 
“Living in an apartment, they’re likely not hiring home improvement contractors, so I think there’s kind of the realization of just, how much does it cost to hire a plumber,” said Angie Hicks, co-founder of Angi.
“Understanding that process is enlightening for them,” she said.

Annual “hidden costs” of homeownership average around $18,000 nationwide, according to a separate report by Bankrate.com. Its report estimated home maintenance at 2% a year of the value of a home.
Based on that calculation, Bankrate estimated, annual maintenance costs in some of the states with the highest home prices — like California, Hawaii and Massachusetts — can go over $26,000 annually.
Meanwhile, in Kentucky, which Bankrate pointed to as the least expensive state, annual maintenance might be around $5,000.
First-time homeowners are less likely to be aware of those costs than those who have previously owned a home, Angi found, and more likely to say they spent more than expected on home maintenance, improvements and emergencies.
“Once you’ve been a homeowner for a while, you realize everything that can go wrong,” Jeff Ostrowski, an analyst at Bankrate.com, recently told CNBC. 
Here are things you should consider when shopping for a home and as a new homeowner, to help limit maintenance surprises:

1. Have a home inspector lined up

In April, around 19% of buyers waived the home inspection, down from 22% one month prior and 21% a year earlier, according to the National Association of Realtors.
Sometimes home inspections are skipped because they have to be done in a quick time frame and “you start to make choices that may not be ideal” out of the fear you’ll lose the home, Hicks said.

But hiring a home inspector is essential, said Dan Bawden, a residential construction expert and president of Legal Eagle Contractors Co. in Bellaire, Texas.
“That’s probably the most important thing you can do,” he said.
Typically, home inspectors need one week’s notice on average, he said, so keep that in mind as you start looking at homes.
Ask real estate agents for referrals on licensed home inspectors in your area who will conduct a thorough service, Bawden said.
“Instead of spending $450, you might spend $600 for somebody that’s better, but that’s money well spent,” he said. “You want them to find as many things as possible.”

2. Look for ‘deal breakers’ in the home inspection

JGI/Tom Grill | Tetra images | Getty Images

The home inspection is “an important element” in the homebuying process because you can discover elements in a house that could be a “deal breaker,” said Hicks.
Be present for the inspection, if you can.
“If you’re there with them, they will tell you what things are urgent or severe,” Bawden said.
For instance, if the house has many cracks along the doorway or windows, or feel a downward slope as you walk across a floor, it may have foundational issues, he said.
“You do not want to buy a house with foundation problems. They will get worse over time and they are expensive to fix,” Bawden said.
Other notable deal breakers include termite damage and water damage, he said.
An inspection can also help you understand the age of important elements, like the roof. Take advantage of the inspection process to ask questions about these elements, and then assess if you have the budget to cover those costs, or if it’s something worth asking the seller about, Hicks explained.
Having a complete list of problem areas noted in an inspection can help you prioritize repairs and potentially negotiate the purchase price of the home, said Bawden.

3. Keep your ‘critical eye’ as a homeowner

Once you become a homeowner, it will be important to keep up with routine maintenance in your house. “Don’t skip out on having that air conditioner or furnace tuned up,” said Hicks. “It’s like changing the oil on your car.”
To avoid surprises, try to regularly inspect your home and look for spots or corners that may need to be fixed. While homeowners are “the most critical” of a house when they’re buying, they often don’t keep the “critical eye” after moving in, said Hicks.

Have mechanical system checkups at least once a year, said Bowden, as well as plumbing and electrical system checkups.
“You need to be vigilant,” he said.
Correction: This story has been updated to correct a figure and a quote from Angie Hicks.

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As Congress wrestles with a looming decision over trillions in expiring tax breaks, some Democratic lawmakers and experts are calling for higher taxes on corporations and wealthy Americans.
Lawmakers and experts debated several Democratic proposals.
More than 60% of taxpayers will face higher taxes if all the individual provisions from the Tax Cuts and Jobs Act expire after 2025.

Senator Chuck Grassley, a Republican from Iowa and ranking member of the Senate Budget Committee, during a hearing in Washington, DC, on Tuesday, March 12, 2024. 
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As Congress wrestles with a looming decision over trillions in expiring tax breaks, lawmakers and experts in a Senate Budget Committee hearing debated several Democratic proposals for higher taxes on corporations and wealthy Americans.
Proponents said the plans aim to address income inequality and the federal budget deficit.

Some of the debate included scrutiny of the corporate tax rate, stock buybacks, capital gains tax rates and levies on profits for private equity and hedge fund managers, known as carried interest. They also discussed taxes on unrealized gains, or profits on unsold assets, among other proposals.
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Higher taxes on corporations and the wealthy would “create a more equitable tax system which generates substantially more revenue and promotes growth,” Joseph Stiglitz, professor of economics at Columbia University, said in prepared testimony.
However, many of these proposals, such as reforms to carried interest, have failed to gain broad support even among Democrats, said Sen. Chuck Grassley, R-Iowa.
While carried interest reform was originally included in the Inflation Reduction Act, those changes were removed before the bill passed in the Senate.

Sen. Mitt Romney, R-Utah, said most of the proposed tax increases discussed during the hearing would have “unintended consequences” for the economy.

The debate over expiring tax breaks

President Joe Biden has also called for higher taxes on the wealthy and corporations, saying these taxes would help pay for an extension of expiring tax breaks for filers who make less than $400,000.
The Tax Cuts and Jobs Act of 2017, or TCJA, which was enacted by former President Donald Trump, included lower federal income brackets, raised the standard deduction and doubled an estate and gift tax exemption, among other provisions.

Without action from Congress, more than 60% of filers will pay higher taxes after 2025 once TCJA provisions expire, according to the Tax Foundation.
However, a full extension of expiring provisions will be costly and could add an estimated $4.6 trillion to the deficit over the next decade, the Congressional Budget Office reported in May.
While Trump hasn’t disclosed many tax policy proposals during his presidential campaign, he has expressed interest in fully extending expiring TCJA provisions.
Of course, the future of the legislation ultimately hinges on which party controls Congress and the White House. More

The Federal Reserve held rates steady at the end of its two-day meeting Wednesday, once again pushing back the start of rate cuts and any relief from sky-high borrowing costs.
Higher prices and interest rates have put many households under pressure.

Chris Wattie | Reuters

The Federal Reserve announced Wednesday that it will leave interest rates unchanged. Fresh inflation data issued earlier in the day showed that consumer prices are gradually moderating though remain above the central bank’s target.
The Fed’s benchmark fed funds rate has now stood within the range of 5.25% to 5.50% since last July.

The central bank projected it would cut interest rates once in 2024, down from an estimate of three in March.
For consumers already strained by the high cost of living, there is an added toll from persistently high borrowing costs.
“It’s not enough that the rate of inflation has come down,” said Greg McBride, chief financial analyst at Bankrate.com. “Prices haven’t, and that is what is really stressing household balances.”
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Inflation has been a persistent problem since the Covid-19 pandemic when price increases soared to their highest levels since the early 1980s. The Fed responded with a series of interest rate hikes that took its benchmark rate to the highest level in decades.

The federal funds rate, which is set by the U.S. central bank, is the rate at which banks borrow and lend to one another overnight. Although that’s not the rate consumers pay, the Fed’s moves still affect the borrowing and savings rates they see every day.
The spike in interest rates caused most consumer borrowing costs to skyrocket, and now, more Americans are falling behind on their payments.
From credit cards and mortgage rates to auto loans and student debt, here’s a look at where those monthly interest expenses stand.

Credit cards

Since most credit cards have a variable rate, there’s a direct connection to the Fed’s benchmark. In the wake of the rate hike cycle, the average credit card rate rose from 16.34% in March 2022 to nearly 21% today — nearing an all-time high.
“Consumers need to understand that the cavalry isn’t coming anytime soon, so the best thing you can do is take things into your own hands when it comes to lowering credit card interest rates,” said Matt Schulz, chief credit analyst at LendingTree.
Try calling your card issuer to ask for a lower rate, consolidating and paying off high-interest credit cards with a lower-interest personal loan or switching to an interest-free balance transfer credit card, Schulz advised.

Mortgage rates

Although 15- and 30-year mortgage rates are fixed and tied to Treasury yields and the economy, anyone shopping for a new home has lost considerable purchasing power, partly because of inflation and the Fed’s policy moves.
The average rate for a 30-year, fixed-rate mortgage is just above 7%, up from 4.4% when the Fed started raising rates in March 2022 and 3.27% at the end of 2021, according to Bankrate.
“Going forward, mortgage rates will likely continue to fluctuate and it’s impossible to say for certain where they’ll end up,” noted Jacob Channel, senior economist at LendingTree. “That said, there’s a good chance that we’re going to need to get used to rates above 7% again, at least until we start getting better economic news.”

Auto loans

Even though auto loans are fixed, payments are getting bigger because car prices have been rising along with the interest rates on new loans, resulting in less affordable monthly payments. 
The average rate on a five-year new car loan is now more than 7%, up from 4% in March 2022, and that’s not likely to change, according to Ivan Drury, Edmunds’ director of insights.
“Until we hit summer selldown months in the latter half of the third quarter, we should expect rates to remain relatively static during the foreseeable future,” Drury said.
However, competition between lenders and more incentives in the market lately have started to take some of the edge off the cost of buying a car, he added.

Student loans

Federal student loan rates are also fixed, so most borrowers aren’t immediately affected by the Fed’s moves. But undergraduate students who took out direct federal student loans for the 2023-24 academic year are paying 5.50%, up from 4.99% in 2022-23 — and the interest rate on federal direct undergraduate loans for the 2024-2025 academic year will be 6.53%, the highest rate in at least a decade.
Private student loans tend to have a variable rate tied to the prime, Treasury bill or another rate index, which means those borrowers are already paying more in interest. How much more, however, varies with the benchmark.

Savings rates

While the central bank has no direct influence on deposit rates, the yields tend to be correlated to changes in the target federal funds rate.
As a result, top-yielding online savings account rates have made significant moves and are now paying more than 5% — above the rate of inflation, which is a rare win for anyone building up a cash cushion, according to Bankrate’s McBride.
“Savers are sitting back and enjoying the best environment they’ve seen in more than 15 years,” McBride said.
Currently, top-yielding one-year certificates of deposit pay over 5.3%, as good as a high-yield savings account.
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