Markus Andrews

Series I bonds are now paying 5.27% annual interest through April 2024, up from the 4.3% yearly rate offered since May.
While the new rate is down significantly from the record 9.62% in May 2022, investors can now lock in a fixed rate of 1.3%, which may appeal to long-term investors.
However, short-term investors should compare I bonds to options like certificates of deposit, high-yield savings accounts, Treasury bills and money market funds, experts say.

Eric Audras | PhotoAlto Agency RF Collections | Getty Images

Series I bonds are now paying 5.27% annual interest through April 2024, up from the 4.3% yearly rate offered since May — and experts have tips for short- and long-term investors.
While the new rate is down significantly from the record 9.62% offered in May 2022, investors can now lock in a fixed rate of 1.3%, up from 0.9%, for I bonds purchased from May 1 through Oct. 31.

The new fixed rate is the highest since 2007.
If you’re a long-term investor, “it’s definitely a good time to build up some I bonds,” said Ken Tumin, founder and editor of DepositAccounts.com, which tracks I bonds, among other assets.
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There are two parts to I bond yields — a variable and fixed rate portion — which the U.S. Department of the Treasury adjusts every May and November.
While the variable rate changes every six months based on inflation, the Treasury may also adjust the fixed rate or keep it the same. The fixed rate stays the same after purchase and the variable rate resets every six months starting on your original purchase date. (There’s a historic breakdown of both rates here.)

“The 1.3 percent fixed rate is what you should be focused on,” said certified financial planner Jeremy Keil at Keil Financial Partners in New Berlin, Wisconsin. “It’s the best fixed rate in 15-plus years.”
Experts say the new 1.3% fixed rate makes I bonds an attractive option for long-term investors looking for an inflation-protected place for cash.

The 1.30% fixed rate is what you should be focused on. It’s the best fixed rate in 15-plus years.

Jeremy Keil
Financial advisor at Keil Financial Partners

“After five years, you can redeem [I bonds] without worrying about a penalty,” Tumin said. “At that point, it can become a very good emergency fund.”
You can buy I bonds online through TreasuryDirect. There’s a $10,000 per calendar year limit for individuals, but also a few ways to bypass it. You can, also purchase an extra $5,000 in paper I bonds with your federal tax refund.

Better options for short-term cash

While I bonds may appeal to long-term investors, experts say there are better options for short-term cash.
One of the downsides of I bonds is you can’t access the money for at least one year. You’ll also trigger a three-month interest penalty by redeeming I bonds within five years, which cuts into your overall return.

If you need the money in a year, “you’re probably better off with a top online certificate of deposit,” said Tumin. The top 1% average for one-year CDs is nearly 5.75%, as of Nov. 1, according to DepositAccounts.
Of course, you can’t directly compare I bonds to a one-year CD because I bond rates change every six months, he said. 
More flexible options may include high-yield online savings accounts, Treasury bills, or money market funds. However, those rates may eventually decline if the Federal Reserve starts cutting interest rates. More

Applicants for Social Security disability benefits face long wait times amid a record backlog of applications.
Experts and lawmakers say more can be done to expedite the process.

Richard Stephen | Istock | Getty Images

If you’ve applied for Social Security disability benefits and are still waiting for an answer, you’re not alone.
“For the first time in history, more than 1 million people are waiting on the Social Security Administration to process their initial disability claim,” said Rep. Drew Ferguson, R-Ga., chair of the House Ways and Means Social Security subcommittee, at a hearing last week.

It currently takes 220 days for claims to be decided, on average, which is more than 100 days longer than it did in 2019, Ferguson said. That is also more than 150 days longer than the Social Security Administration’s standard for minimum level of performance, he said.
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“The real-world consequences for these individuals who are unable to work and wait for their disability decision is devastating,” Ferguson said.

‘He died from the conditions that he applied with’

Experts who testified at the hearing said they have seen the effect of the growing wait times firsthand.
One Social Security disability applicant finally had a hearing scheduled for this month but did not live until the scheduled date, according to David Camp, interim CEO at the National Organization of Social Security Claimants’ Representatives.

That came after his claim for Social Security disability benefits had been denied initially and again at reconsideration, a process where initial decisions may be appealed.
“He died from the conditions that he applied with, that went untreated,” Camp said.
While the patient sought help with 825 days left to live, Social Security wasted more than 500 days with its delays.
“He could not live long enough to outlast Social Security’s capacity to delay,” Camp said.

Moreover, 90% of the reconsideration findings were identical to the initial conclusions, he noted.
From 2010 to 2022, claims for Social Security disability benefits declined by 37%, while claims for Supplemental Security Income, or SSI, fell by 49%, according to Camp. Yet wait times have increased.
“The problem is Social Security’s policies,” Camp said.
Linda Kerr-Davis, acting assistant deputy commissioner of operations at the Social Security Administration, testified at the hearing and acknowledged that the average seven-month wait time for a decision is a problem.
“This is simply not acceptable to you or to us,” Kerr-Davis said.

The steps we have taken are just beginning to show positive results.

Linda Kerr-Davis
acting assistant deputy commissioner of operations at the Social Security Administration

The agency has been taking steps to address the issue within the constraints of its budget, she said, by redirecting experienced personnel, hiring new full-time professionals and working on improvements to processes and policies.
“The steps we have taken are just beginning to show positive results,” Kerr-Davis said.
Experts and lawmakers who testified at the hearing raised more suggestions. These included:

1. Eliminate the reconsideration process

The Social Security disability application may involve an initial application followed by another step called reconsideration, if that first attempt to receive benefits is rejected.
If an applicant does not agree with the decision made during reconsideration, they may then meet with an administrative law judge.
Meeting with a judge is often a more thorough process and typically results in more approvals for benefits, experts said. On the other hand, reconsideration often reaffirms the findings of an initial decision and often adds extra time to process a disability case.
Consequently, experts questioned whether the reconsideration step was a necessary part of the process. Eliminating it altogether may reduce the application process time for individuals who urgently need financial support.

The Social Security Administration has tested eliminating the reconsideration stage, though it has not shared the results, according to Camp.
“If there is a data-driven reason for reconsideration, show us,” Camp said.
Jennifer Burdick, co-chair of the Consortium for Citizens with Disabilities Social Security Task Force, also questioned the need for the practice, which is “largely seen as a rubber stamp,” she said.
Eliminating that phase of the process could free disability determination services staff to work on initial disability claims and reduce backlog, she said.

2. Increase funding for Social Security Administration

Congressional Republicans have proposed a 30% federal budget cut, which would be “completely devastating” to the Social Security Administration, said Kerr-Davis.
Office hours for the agency’s field offices would be shortened, while disability benefit applicants would see wait times increase by at least two months, she added.

Aleksandr Zubkov | Moment | Getty Images

Even level funding from fiscal year 2023 into 2024 would be detrimental to the agency, Kerr-Davis said, as it would not be enough money to build the disability determination services workforce or maintain it.
“There just needs to be more bodies to work these claims,” Burdick said. “This won’t happen unless Congress provides SSA with meaningful sustained funding consistent with the President’s 2024 budget request.”

3. Ensure Social Security uses current resources wisely

While the Social Security Administration is unable to keep up with its current disability claims, it is spending hundreds of millions of dollars on outreach efforts to increase claims, Ferguson noted.
“It feels like those dollars should be going to address the issue that is at hand,” Ferguson said.
In the past 12 years, the agency has invested more than $300 million to obtain up-to-date occupational data that can be used to determine whether a claimant can work in today’s economy.
Yet the Social Security Administration continues to rely on occupational data that is more than 30 years out of date, he noted.
“The SSA is making it harder for claimants and making more work for itself,” Ferguson said. More

Compensation for union workers in the U.S. is up 11.5% since the first quarter of 2020, compared with 14.6% for nonunion workers.
The rise in pay growth for unionized employees this year stems in part from significant labor action.
Still, many unionized workers haven’t negotiated a new contract since the Covid-19 pandemic began.

United Auto Workers members and supporters rally at the Stellantis North America headquarters in Auburn Hills, Michigan, on Sept. 20, 2023.
Bill Pugliano | Getty Images News | Getty Images

While predictions across the board about employee pay are forecasting slower wage growth next year, there’s a notable exception: union workers, especially those in service and manufacturing roles.
They have a long way to go. Compensation for union workers is up just 11% since the first quarter of 2020, compared with 14.6% for nonunion workers, according to Bureau of Labor Statistics data from the second quarter of 2023.

However, wages for union workers grew 4.6% alone in the second quarter of 2023, narrowing the gap with employees who do not belong to unions. The rise in pay growth for unionized employees this year stems, in part, from significant labor action, including a string of labor deals resulting in higher pay.
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The latest data does not reflect recent deals between the United Auto Workers and Ford Motor Company, General Motors and Stellantis, where some employees could receive 25% wage increases. At Ford and Stellantis, employees could see their top wage boosted to more than $40 an hour, and starting wages could jump 68%, to $28 an hour, the UAW said.
While those pay jumps seem significant, collective bargaining agreements are often locked in for several years due to contracting periods and restrictions for how workers can negotiate. Many unionized workers, for example, haven’t negotiated a new contract since the Covid-19 pandemic began.
“Unionized workers couldn’t see the same scale of wage increases over the past few years that non-unionized workers did,” said Aaron Terrazas, Glassdoor’s chief economist. “To some degree, they’re now catching up.”

In other words, it is a particularly prudent time for unionized workers to organize as they enter new contracting periods, experts day.
Cumulative wage growth is still faster for nonunionized workers than for unionized workers, but the gap is narrowing, said Julia Pollak, chief economist at ZipRecruiter.
Through Oct. 9 this year, approximately 453,000 workers have participated across a total of 312 strikes, significantly higher than the 180 strikes involving 43,700 workers during the same period two years ago.
The data is compiled by Johnnie Kallas, a Ph.D. candidate at Cornell University’s School of Industrial and Labor Relations, and the project director of the ILR Labor Action Tracker.

Union jobs can be less vulnerable, though underpaid

In general, union worker wages are less vulnerable to booms and busts in the labor market compared to nonunionized workers, Terrazas said.
“The end result is that the strikes seem like they’re kind of picking up while wages are kind of winding down,” Indeed economist Cory Stahle explained.
On the opposite end, LaCinda Glover, a senior principal consultant at Mercer, said she did not expect to see large upward swings in compensation in tech and health care, both of which are fighting layoff or financial pressures from increased spending during the pandemic.
“They have invested so much in compensation over the last few years that it’s really not sustainable,” she said.Don’t miss these CNBC PRO stories: More

Dupes, short for “duplicate,” are cheaper alternatives to premium or luxury products and they are increasingly popular among Gen Z and millennial shoppers.
“The online culture of dupe shopping, accelerated by TikTok especially in the last few years, has flipped the script,” said Ellyn Briggs, brands analyst at Morning Consult.
TikTok videos with the #dupe hashtag have racked up nearly six billion views to date, and 70% of intentional dupe shoppers have a TikTok account.

Aire Images | Moment | Getty Images

So-called girl math is not the only trend spurred by users on the short-form video app TikTok. “Dupes,” short for “duplicate,” are cheaper alternatives to premium or luxury consumer products, and they are increasingly popular among Gen Z and millennial shoppers and app users.
While nearly one-third of adults, 31%, have intentionally purchased a dupe of a premium product at some point, Gen Z and millennials have higher participation rates: roughly 49% and 44%, respectively, according to Morning Consult. The business intelligence company polled 2,216 U.S. adults in early October.

“The online culture of dupe shopping, accelerated by TikTok especially in the last few years, has flipped the script,” said Ellyn Briggs, brands analyst at Morning Consult.
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Instead of being an indicator of lower status or considered “shameful,” dupe shopping is now “something that’s actually a prideful thing for consumers,” she added.
While shoppers may miss out on the experience luxury products provide, dupes are less expensive versions that help consumers save money and test an item before splurging on the real thing.
“Yes, a dupe can give you this sense of ‘gaming the system,'” said New York-based writer Marisa Meltzer, “but it’s not going to be the same feeling you get with an expensive product.”

Meltzer has been covering the fashion industry as a freelance writer for more than a decade and recently published her book titled “Glossy: Ambition, Beauty, and the Inside Story of Emily Weiss’s Glossier.”

A way to ‘partake in that product experience’

Unlike a counterfeit product, which tends to carry an unauthorized trademark or logo of a patented brand, dupes simply mimic certain features of more expensive products.
They also help consumers determine whether the replica is as good as the real version, said Briggs.
When shoppers were polled on the reasons they buy dupes instead of brand-name products, “money was the top answer,” said Briggs — especially for a group whose income level is relatively low.

To wit, 49% of respondents reported a household income below $50,000. Additionally, 67% of polled consumers said saving money is a major deciding factor, the report from Morning Consult found.
“It’s a way for [consumers] to partake in that product experience without having to spend a high amount of money,” Briggs said.
TikTok videos with the #dupe hashtag have racked up nearly six billion views to date, and 70% of intentional dupe shoppers have a TikTok account, the report found.

However, while discourse about dupes is strongly associated with TikTok and the shopping tendency remains prevalent for now among younger retailers, shopping for dupes could become a mainstream tendency across generations as the information becomes more accessible, Meltzer said.
In the end, it’s a personal decision for consumers, who should make an assessment of what is best or financially feasible for them, Briggs said.
“It depends how much you want it and why you want it,” added Meltzer. “I think everyone needs to find their splurge where it makes the most sense for them.”Don’t miss these CNBC PRO stories: More

The number of Americans who say they are stretched too thin has shown no signs of improvement amid high prices and higher interest rates.
Federal Reserve Chair Jerome Powell recently said “inflation is still too high,” indicating that interest rates will stay higher for longer.
One bright spot: Some online savings account rates are now paying more than 5%, which is the most savers have been able to earn in nearly two decades.

‘Inflation is still too high’

The Federal Reserve is expected to announce it will leave rates unchanged at the end of its two-day meeting this week, even though Fed Chair Jerome Powell recently said “inflation is still too high.”
Recent data is painting a mixed picture of where the economy stands. Inflation has shown some signs of cooling, but the core personal consumption expenditures price index, which the Fed uses as a key measure, increased 0.3% in September.
The consumer price index, another closely followed inflation gauge, also rose at a slightly faster-than-expected pace over the month, boosted by higher prices for food, gas and shelter. As a result, real average hourly earnings fell.

The consensus among economists and central bankers is that interest rates will now stay higher for longer.

Households must make ‘tough choices’

“Many households are seeing their finances stretched thinly by the combination of high prices for goods and services as well as high interest rates,” said Brett House, economics professor at Columbia Business School.
“Many are having to make tough choices to defer discretionary spending in order to stay on top of their loan payments and the costs of necessities,” he added. The resumption of student loan payments only adds to this stress.

Some 74% of Americans say they are stressed about finances, according to a separate CNBC Your Money Financial Confidence Survey conducted in August. Inflation, rising interest rates and a lack of savings contribute to those feelings.
That CNBC survey found that 61% of Americans are living paycheck to paycheck, up from 58% in March.
Many households have tapped their cash reserves over the past few months, LendingClub and other reports show.
Nearly half, or 49%, of adults have less savings or no savings compared to a year ago, according to a Bankrate survey.
On the upside, those with remaining balances, which are concentrated among high-income households, are seeing “better interest payments than they’ve received at any time in the recent past,” House said.
High-yield savings accounts, certificates of deposit and money market accounts are now paying more than 5%, according to Bankrate, which is the most savers have been able to earn in nearly two decades.
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Jewel Inostroza was very excited when she bought her home in Newnan, Georgia, in 2008.
“It seemed like it was a very nice, cozy, close-knit community,” said the 54-year-old. “Then it started turning into a horror story.”

Inostroza is the only one listed on the deed, but she and her husband Enrique, 48, share financial responsibility of the home.
They became aware after they moved in that they had bought into a “common-interest community.” Typically, that means real estate where owners pay a portion of expenses connected to shared amenities and common areas. These communities are usually overseen by homeowners associations.
Homeowners associations, also known as HOAs, are self-governing organizations that implement rules for homeowners and renters within common-interest communities. A board of directors, made up of volunteer homeowners in the community, run the HOA. The board may choose to hire a management company, many of which are for-profit, to help run day-to-day operations.
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It’s becoming increasingly common for new homeowners to find themselves in an HOA-governed property. Roughly 84% of newly built, single-family homes sold in 2022 belonged to homeowners associations, according to the U.S. Census Bureau.

“In most southern states and western states, it’s nearly impossible for a homebuyer to locate a single-family home that’s not part of some sort of HOA,” said Deborah Goonan, administrator of the blog Independent American Communities. “Certain local governments require almost all new construction to have an HOA.”

How a $200 annual HOA fee became a $12,000 burden

The Inostrozas’ annual HOA dues are $200. On paper, their HOA membership doesn’t seem like much of a financial burden — but that has not been their reality.
The couple was surprised to find after they moved in that their property had an outstanding balance from before they bought it: unpaid dues, along with other penalties and charges.
The HOA was “fining us for that balance and late fees and any other type of fines that they would put onto the home for lawn care or anything,” said Jewel Inostroza. “All of that was attached to this home when we moved in.”

Jewel Inostroza and Enrique Inostroza stand in the doorway of their home in Newnan, Georgia.
Mark Licea | CNBC

The couple was unwilling to pay those fines and said the HOA and its management company at the time, Homeowners Management LLC, were not responsive to their attempts to get the balance voided. Documentation reviewed by CNBC from as early as 2012 shows that the balance continued to grow. The Inostrozas said communication with the HOA prior to 2011 was by phone.
By August 2015, the HOA put a lien on the Inostrozas’ home. In the court documents, the HOA said the Inostrozas owed more than $1,600.
A lien is when a party has a legal claim against an asset, such as a home, which can serve as collateral to satisfy unpaid debt. This can open the door to an HOA or other complainant escalating to the next level of debt collection, such as foreclosing on the home or, in the Inostrozas’ case, garnishing wages.
In mid-2015, Jewel Inostroza said the HOA began garnishing wages directly from her paycheck to satisfy the unpaid fees.
“The first time I learned of that was when I got my first paycheck that they garnished,” she said. “I didn’t get any prior notice.
“There was nothing sent,” Jewel Inostroza added. “I got a notice two weeks after.”
Despite the garnishment, invoices from the HOA reviewed by CNBC do not show any reduction in the total balance owed. By December 2016, documents show the Inostrozas owed the HOA more than $4,300.
The Inostrozas hired a lawyer, who they say came to an agreement in 2016 with the HOA’s attorneys to stop the garnishment. Under that agreement, the Inostrozas would pay approximately $3,100 in installments. They finished paying that amount off by this past January, according to documentation reviewed by CNBC.
“But it seemed like [the deal] never got to the management [company] or homeowners association,” Enrique Inostroza said. “They were just adding fines and adding interest.”
The Inostrozas estimate they’ve paid about $12,000 in fines and garnished wages to the HOA in addition to thousands in legal fees to their lawyer. As of Aug. 18, 2023, the most recent invoice the Inostrozas received, the HOA says they owe nearly $8,000.
CNBC reached out multiple times to Homeowners Management LLC for comment and received automated responses directing us to contact the current management company, which changed hands as of August 2023.
A representative of the current management company, Sentry Management, told CNBC because it “just became the management company for this community in the last couple of months, [Sentry has] little ability to comment on historical facts,” regarding the Inostrozas’ case.
“Once a homeowner has been referred to an attorney for delinquency, which happened well before Sentrywas involved, the homeowner needs to resolve the matter with the association’s attorney,” Bradley Pomp, president of Sentry Management, explained to CNBC in an email. “We do not have any authority to get involved or bring settlement.”
The attorneys that represent the HOA did not respond to CNBC’s repeated requests for comment.
The former director of the HOA board, who oversaw the association from 2020 until her resignation in October 2023, declined to comment.

The case for HOAs

A big part of many HOA sales pitches is that the presence of the organization helps increase property values.
“The board is responsible for protecting property values,” said Tom Skiba, CEO of the Community Associations Institute, a membership organization of homeowner and condominium associations. “For most people in the U.S., [their homes are] the single biggest investment they’re ever going to make.”
There’s mixed data about the effects HOAs have on property values.
On average, HOA homes cost at least 4% — or $13,500 — more on average than non-HOA homes, according to a 2019 study in the Journal of Economics. But those property values can vary significantly by location. A 2019 analysis from Critical Housing Analysis of three different U.S. cities found that the home values in HOA areas were less than those in neighborhoods without them.
HOAs can also be necessary to manage shared amenities or land, which can be a value-add for homeowners. In single-family home communities, that could be shared swimming pools or even golf courses. They may also offer homeowners services to help maintain their properties.
“There are associations out there that handle all the landscaping,” Skiba said. “Even though you may own your lot, the association cuts the grass and they do all the landscaping. You find that very commonly in over 55 communities where folks just don’t want to be bothered with that kind of task anymore. So is that a cost savings? Sure.”

‘They act as hyperlocal governments’

The Inostrozas’ experience with their HOA highlights some patterns of power dynamics seen across the country.
More than half, 57%, of homeowners with an HOA dislike the arrangement, and more than 3 in 10 say they feel their HOA has too much power, according to a 2023 survey conducted by Rocket Mortgage. The lender surveyed 1,001 Americans with an HOA.
“They act as hyperlocal governments and, in many ways, supersede all the other laws that exist,” said Steve Horvath, co-founder of advocacy group HOA United.

HOAs are rooted in “the desire for municipalities to offload their responsibilities for taking care of things that you would normally associate with paying your taxes,” Horvath said, such as maintaining sidewalks, roads and sewers.
Homeowners who have disputes with their HOA say they have trouble getting help from official government channels.
“The only rights that homeowners have is to take them to civil court,” said Raelene Schifano, co-founder of HOA United. “And it’s not a successful project.”
Lawmakers in several states, including Maryland, North Carolina and Florida, have introduced legislation to address some of the issues homeowners have been raising about HOAs, but they have been met with backlash from the professional management industry.
As of right now, change has to happen at the grassroots level, with homeowners fighting through the court system as well as through voting for a board they feel represents them.
Watch the video to learn more about how homeowners associations are shaping American neighborhoods. More