Markus Andrews

With President Donald Trump back in the White House and Republicans in control of Congress, a number of student loan programs face uncertainty.
Trump is a vocal critic of education debt forgiveness policies.
Meanwhile, House Budget Committee Republicans are exploring options for limiting eligibility for the Public Service Loan Forgiveness program and axing a popular tax break for borrowers.

US President Donald Trump holds up outgoing President Joe Biden’s letter as he signs executive orders in the Oval Office of the WHite House in Washington, DC, on Jan. 20, 2025.
Jim Watson | AFP | Getty Images

With President Donald Trump back in the White House and Republicans in control of Congress, experts worry that a number of student loan programs may now be in jeopardy.
At-risk programs include the U.S. Department of Education’s new repayment option for borrowers — called the Saving on a Valuable Education, or SAVE, plan — and the Biden administration’s more lenient bankruptcy policy.

Meanwhile, House Budget Committee Republicans are floating proposals that would reduce or eliminate more student loan programs, including the Biden administration-era rules that made it easier for borrowers to get debt relief when they’re defrauded by their schools, Politico reported last week.
Consumer advocates are worried for borrowers based on Trump’s comments about student loan relief on the campaign trail. At one rally, he called the Biden administration’s debt forgiveness efforts “vile” and “not even legal.”
The White House did not immediately respond to a request for comment.
More than 40 million Americans carry federal student loans, and the outstanding debt exceeds $1.6 trillion, according to higher education expert Mark Kantrowitz.
Here are the programs experts think are most at risk under the Trump administration.

SAVE plan

When SAVE launched in 2023, the Biden administration called its new repayment plan for federal student loan borrowers “the most affordable student loan plan ever.” SAVE cut many borrowers’ monthly bills in half and shortened the timeline to loan forgiveness for those with smaller balances.
It quickly proved popular. To that point, around 8 million borrowers signed up for the new income-driven repayment, or IDR, plan, the White House had said.
But the plan also quickly ran into legal troubles.
Republican attorneys general in Kansas and Missouri, who led the legal challenges against SAVE, argued that President Joe Biden was essentially trying to find a roundabout way to forgive student debt after the Supreme Court blocked its sweeping debt cancellation plan in June 2023. Due to those legal actions, the plan has been on hold since last year.
More from Personal Finance:Here’s the inflation breakdown for December 2024 — in one chartWorried about Social Security’s future? What to consider before claiming benefitsHere’s who qualifies for Biden’s $4.2 billion in student loan forgiveness
The plan is unlikely to survive a second Trump term, Kantrowitz said.
“There are several methods the Trump administration could use to kill the SAVE repayment plan,” he said. “They could abandon the defense of the repayment plan in the pending lawsuits.”
“They could issue new regulations to revoke the repayment plan,” or Congress could pass a law to do away with the plan, Kantrowitz added.
Currently, SAVE enrollees are excused from making payments while the plan is tied up in the courts. That reprieve may soon end, too, experts said.

Bankruptcy protections

For decades, student loan borrowers found it next to impossible to walk away from their federal student debt in bankruptcy. The Biden administration changed that.
In the fall of 2022, the Department of Education and the Department of Justice jointly released updated bankruptcy guidelines to make the bankruptcy process for student loan borrowers less arduous. The Biden administration’s updated policy treated student loans like other types of debt in bankruptcy court, experts said.
Trump is likely to rescind that guidance, Kantrowitz said.
“There may be more of a scorched earth approach to opposing all attempts to discharge federal student loans in bankruptcy,” he said.

However, Malissa Giles, a consumer bankruptcy attorney in Virginia, said she was hopeful that the guidance will remain in place.
Still, her concern is that many jurisdictions will have new assistant U.S. attorneys, “and we may see a shift in the approach based on changing politics and pressures of more Republican-aligned U.S. attorneys.”
For now, Giles said she was being more conservative in what student loan bankruptcy cases she took on.

Other student loan aid at risk

Among the recent ideas floated by House Budget Committee Republicans is the partial repeal of the Biden administration’s Borrower Defense regulations, which made it easier for borrowers to get their debt excused when their school engaged in misconduct.
The GOP members are also reviewing reforms to Public Service Loan Forgiveness, including the possibility of “limiting eligibility for the program,” according to the document obtained by Politico.
They’re also considering eliminating the student loan interest deduction. That tax break allows qualifying borrowers to deduct up to $2,500 a year in interest paid on eligible private or federal education debt. Before the Covid pandemic, nearly 13 million taxpayers took advantage of the deduction, according to Kantrowitz.

Don’t miss these insights from CNBC PRO More

Roughly 70% of taxpayers qualify for IRS Free File, but only a fraction of eligible filers use the software.
For the 2025 season, you can use IRS Free File if your adjusted gross income, or AGI, was $84,000 or less in 2024.
“It’s not just for simple returns,” said Tim Hugo, executive director of the Free File Alliance.

Rockaa | E+ | Getty Images

How to qualify for IRS Free File

For the 2025 season, you can use IRS Free File if your adjusted gross income, or AGI, was $84,000 or less in 2024.
You calculate AGI by subtracting certain tax breaks from your total, or gross income. The figure will be line 11 on the front page of your 2024 tax return.  
While there are guided Free File options for anyone who made $84,000 or less for 2024, each partner has different eligibility, depending on your age, income, state residency and military status.

Some partners also offer free state tax returns, Hugo said. You can browse all eight partners here.   
The program also offers Free Fillable Forms, which is the electronic version of a paper-filed return, for taxpayers at all income levels.  

Free File ‘not just for simple returns’

Roughly 70% of taxpayers qualify for IRS Free File, but only a fraction of eligible filers use the software, according to Tim Hugo, executive director of the Free File Alliance.
“It’s not just for simple returns,” he said. 
There are eight software partners for 2024 filings and each must accept the most commonly used tax forms and schedules, Hugo explained.
Some of these include Schedule A for itemized deductions, Schedules B and D for investment earnings and Schedule C for self-employed filers, among others.  

The program opened on Jan. 10 and taxpayers can e-file returns prepared through Free File partners starting on Jan. 27, according to the IRS.  

Free File remains a ‘valuable resource’

During the 2024 season, Free File processed 2.9 million returns through May 11, a 7.3% jump compared to the same period in 2023, according to the IRS.
“This program continues to be a valuable resource for eligible individuals looking to file their taxes for free through this unique program,” Werfel said. 
Although the agency launched Direct File, its own free tax filing service, the IRS in May announced an extension of the Free File program through 2029.
“It’s kind of like a hidden gem in the forest,” said Hugo. “We just need more people to know about it.” More

Detroit is the city with the lowest “barrier to homeownership,” according to a new RealtyHop report.
Would-be buyers in Detroit can come up with a 20% down payment in just 2.53 years, according to the findings.
In pricier metros such as New York City, homebuyers might need to save for at least a decade. 

Cofotoisme | E+ | Getty Images

How long it takes you to save for a 20% down payment on a home depends in part on where you live. 
In a pricey area such as New York City, it could take the typical buyer roughly 10.85 years to save $173,000, which is 20% of the median list price of $865,000 for a home, according to a report by RealtyHop, a real estate investment agency.

RealtyHop measured the “barrier to homeownership” for the top 100 U.S. cities by population. The analysis is based on median list price using more than 1.5 million residential listings, as well as median household income data from the U.S. Census Bureau. It assumes a household saves 20% of its annual gross income and intends to make a 20% down payment.
More from Personal Finance:Here’s the inflation breakdown for December 2024 — in one chartWorried about Social Security’s future? What to consider before claiming benefitsHere’s who qualifies for Biden’s $4.2 billion in student loan forgiveness
In each of the five cities with the lowest barrier to homeownership, the savings timeline is less than four years.
Detroit has the lowest barrier to homeownership, the report found. 
In Detroit, potential homebuyers who earn about $39,575 — the median household income in the area — need just 2.53 years to come up with a 20% down payment on a home purchase, the report found. That amounts to $20,000 for a home priced at $100,000.

Cleveland, Ohio, is the runner-up: A potential buyer in the area needs 3.55 years to save $27,800, or 20% of a home that costs $139,000, the median listing price in the area.
Rounding out the top five are Baltimore; Buffalo, New York; and Pittsburgh.

Even in cheap cities, there can be savings roadblocks

Big expenses can derail your down payment savings timeline, even in a city where homes are less expensive.
A separate report by Zoocasa, a Canada-based real estate website and brokerage, found that homebuyers with children on average take longer to come up with a 20% down payment versus buyers without children because of expenses such as child care costs.
Potential homebuyers with children in Detroit, for example, need roughly 20.3 years to save for a 20% down payment from scratch, according to Zoocasa. Meanwhile, homebuyers without children in the area need about 4.2 years to come up with a 20% down payment if they’re starting off without prior savings, the report found.
Rising home prices can represent another challenge, said Jacob Channel, an economist at LendingTree.
“The more expensive real estate is where you want to live, the more you’ll probably want to save for a down payment,” Channel said.
The median list price for homes in Los Angeles, for example, is about $1.13 million, RealtyHop found. LA tops the list of five cities with the biggest barriers to homeownership, followed by Irvine, California; Miami; New York City; and Anaheim, California.
Even the cheapest real estate price on the “high barrier” list — No. 3, Miami — is $699,000, nearly three times pricier than the most expensive city on the “low barrier” list, Pittsburgh.
If a typical household in LA aimed for a 20% down payment, they would need to save $1,339 a month for roughly 14.10 years, the report found.

Why you might not need to put 20% down

In many cases, a 20% down payment is not required for you to buy a home.
In the third quarter of 2024, the average down payment was 14.5% and the median amount was $30,300, according to Realtor.com data. That’s down from 14.9% and $32,700 in the second quarter of 2024, the site found.
Some mortgages require much smaller down payments. For instance, the Department of Veterans Affairs offers VA loan programs; those who qualify can put down as little as 0%. Mortgages from the U.S. Department of Agriculture, referred to as USDA loans, aim to help buyers purchase homes in rural areas and also offer 0% down payment options. 
Federal Housing Administration loans, or FHA loans, can require as little as 3.5% down for qualifying borrowers, which include first-time buyers, low- and moderate-income buyers, and buyers from minority groups. 

The benefit of a smaller down payment is that you can become a homeowner faster, and with less saved up, experts say. 
But if you decide to buy a home with less cash upfront, you’ll likely end up with higher monthly mortgage payments. 
“If you put less money toward a down payment, you’re going to end up with a larger loan,” Channel said.
Additionally, private mortgage insurance is usually added on to the monthly cost when the buyer puts less than 20% down on the home, he said.
PMI can cost anywhere from 0.5% to 1.5% of the loan amount per year, depending on factors such as your credit score and your total down payment, according to The Mortgage Reports. For example, on a loan for $300,000, mortgage insurance premiums could cost from $1,500 to $4,500 a year, or $125 to $375 a month, the site found.
“That’s another kind of payment that might be bundled in with your mortgage that further increases your housing costs,” Channel said. 

How to come up with your own savings timeline

Where you want to live long-term and what your financial circumstances are can help you figure out your own down payment savings timeline, according to Melissa Cohn, regional vice president at William Raveis Mortgage.
First, you need to have a good household budget — understand how much money you make, the amount you typically spend and what you’re able to save in a given month, said Cohn. 
“Can you cut back on how much you spend? Can you increase your savings? … Can you save your bonuses every year?” she said. 

Then, find out what a house in your desired location typically costs. “It would be important for a buyer to go out and get an understanding of what price point would work for them,” Cohn said. 
You also have to save for closing costs, which can vary substantially from place to place, Cohn said.
Average closing costs can range from roughly 2% to 6% of the loan amount, according to NerdWallet. So a $300,000 mortgage could require from $6,000 to $18,000 in closing costs on top of the down payment, it said.
To figure out what closing costs typically amount to in your desired area, ask a mortgage broker or a real estate agent, she said. 
Overall, you want to set realistic goals for yourself and take the time you need to get there. 
“Go as slow or as quickly as you need to,” LendingTree’s Channel said. “Ensure that you’re making good choices.” More

Jakub Porzycki | Nurphoto | Getty Images

The year 2024 was quite an eventful one for the U.S. stock market, with the S&P 500 Index gaining more than 20% for the second consecutive year.
Several factors, including elevated inflation and interest rates, geopolitical tensions, the U.S. presidential elections, and the generative artificial intelligence (AI) boom influenced investor sentiment.

Amid this backdrop, many analysts gave market-beating recommendations. Using TipRanks’ Experts Center Tool, we identified the top 10 U.S. analysts with a high success rate.
TipRanks helps identify top analysts by ranking them based on success rate, average return, and number of recommendations. The rankings reflect analysts’ ability to outperform their peers with their expertise and stock selection.
Now, let’s take a look at the top 10 U.S. analysts, whose ratings issued over a one-year timeframe spanning October 2023 to September 2024, were the most successful.
#1. Gerard Cassidy – RBC Capital
RBC Capital analyst Gerard Cassidy tops the list with an impressive success rate of 88% (based on 91 good ratings out of a total of 103 recommendations) and an average return of 11.5%. Interestingly, his most profitable rating has been on Fifth Third Bancorp (FITB), a financial services company that offers banking, insurance, and wealth management solutions. His buy recommendation on FITB stock during Oct. 19, 2023 to Jan. 19, 2024, generated a return of 38.6%.

#2. Chris Kotowski – Oppenheimer
Earning the second position is Oppenheimer’s Chris Kotowski. The analyst’s ratings yielded an average return of 14%, with a success rate of 88% based on 84 good ratings out of a total of 95 recommendations. His most remarkable rating during the assessment period has been on Carlyle Group (CG), an investment firm that operates through private equity, credit, and investment solutions segments. Kotowski’s buy recommendation on CG stock during the period spanning Aug. 6, 2024 to Nov. 6, 2024, generated a return of 38.8%.
#3. Ebrahim Poonawala – Bank of America Securities
Ebrahim Poonawala from Bank of America secures the third spot based on an overall success rate of 82% and an average return of 10.2%. His best recommendation has been on Western Alliance Bancorporation (WAL), a bank holding company that offers banking solutions through its primary subsidiary, Western Alliance Bank. The analyst’s buy rating on WAL stock generated a return of 55.1% during Oct. 20, 2023 to Jan. 20, 2024.  
#4. Mark Palmer – Benchmark Co.
Benchmark analyst Mark Palmer ranks fourth on the list, with a success rate of 75% and an average return of 23.3%. Palmer’s top recommendation is Bitdeer Technologies Group (BTDR), a technology company engaged in blockchain and high-performance computing. The analyst generated an impressive profit of 212.4% through his Buy rating on BTDR stock from Sept. 25, 2024 to Dec. 25, 2024.
#5. Mark Mahaney – Evercore ISI
Evercore’s Mark Mahaney occupies the fifth place on the list. The analyst has an 80% overall success rate and a 14% average return per rating. The analyst’s best recommendation during the assessment period has been on social media platform Meta Platforms (META). Mahaney’s buy recommendation on META stock delivered a 27.5% return between July 29, 2024 and Oct. 29, 2024.
#6. Brent Thielman – D.A.Davidson
Brent Thielman from D.A. Davidson ranks sixth on the list. He achieved a success rate of 79% and an average return of 13.3%. Notably, Thielman’s most profitable rating during the observed one-year period was a buy on Bowman Consulting Group (BWMN), a consulting company that offers a range of real estate, energy, infrastructure, and environmental management solutions. His bullish rating on BWMN stock yielded a return of 24.4% from Nov. 8, 2023 to Feb. 8, 2024.
#7. Christopher Allen – Citi
Citi analyst Christopher Allen holds the seventh position. In the one-year period through September 2024, Allen generated an average return of 13.8% with an 85% success rate. His best recommendation was on Apollo Global Management (APO), an investment management company focused on alternative investments. Allen generated an impressive return of 64.8% from the buy rating on APO stock from Sept. 11, 2024 to Dec. 11, 2024.
#8. Daniel Fannon – Jefferies
Jefferies analyst Daniel Fannon is eighth on the list. Fannon witnessed an 85% success rate and an average return of 11.1%. Fannon’s best rating was on alternative asset management company Blackstone Group (BX). His buy rating on the stock between Aug. 13, 2024 and Nov. 13, 2024, generated a 36.8% return.
#9. Mike Mayo – Wells Fargo
Mike Mayo from Wells Fargo is placed at the ninth position in the list. He has an 80% success rate and an average return of 8.2%. Mayo’s most profitable recommendation was on Fifth Third Bancorp (FITB). His recommendation on FITB stock generated a return of 38.6% during the period spanning Oct. 19, 2023 to Jan. 19, 2024.
#10. Michael Grondahl – Northland Securities
Finally, Northland Securities analyst Michael Grondahl takes the tenth position with a 70% overall success rate and an average return of 23.4%. His most profitable rating was a buy on Stryve Foods (SNAX), an air-dried meat snack company. Grondahl generated a massive return of 305.10% on his buy rating on SNAX stock during May 15, 2024 to Aug. 15, 2024.
Ending thoughts
Despite macro challenges and geopolitical tensions, these top analysts delivered attractive returns on their stock picks. By following top analysts’ ratings, investors can potentially enhance their portfolio returns and gain from the expertise of the Wall Street pros. More

About 51% of Americans say flight cost will determine their destination choices this year, according to Skyscanner.
International airfare costs about 4% less in 2025 from last year, according to Kayak data. Domestic flights are 3% pricier.
Travel to the Asia-Pacific region is shaping up to be a bargain, experts said.

Osaka, Japan.
Jiale Tan | Moment | Getty Images

The new year has many travelers thinking ahead to 2025 vacation plans — and how much those trips may cost.
About half — 51% — of Americans say flight cost will determine their destination choices this year, according to Skyscanner. And 50% said hotel costs are a factor.

The average person has paid more for travel of late: Airline fares were up 8% in December, on an annual basis, and hotel costs had increased 2%, according to the consumer price index.
But travelers can still find deals, experts said.
They may find the best bargains by going abroad in 2025 — especially by visiting the Asia-Pacific region, experts said.

Airfare for international trips is down 4% this year compared with 2024, according to a recent Kayak analysis. About two-thirds of all flight searches for travel in 2025 are for international flights, it found.
Conversely, airfare for U.S. flights in 2025 is up 3% from last year, Kayak said.

Kayak’s analysis examined its internal search data between May 1 and Oct. 31, 2024, for travel in 2025.
Domestic fares in January are about 12% higher relative to the same month last year, according to Hopper, a travel site. They’re expected to stay above 2023 and 2024 levels until at least halfway through the year.
“Overall, it’s going to be a more expensive year than last year” for domestic travel, said Hayley Berg, lead economist at Hopper.
Largely, that’s because flying domestically in 2024 was cheap, as airlines “flooded the market” with seat inventory, Berg said.
More from Personal Finance:Why Americans traveling to Europe may find bargains in 2025Demand for international trips drives ‘travel momentum’Here are 4 big ways to save on your next trip
“Prices this year are very similar to prices in 2023,” she said. “And 2024 really threw us for a loop in how low they got.”
Meanwhile, long-haul fares to Europe, South America, Oceania and Asia are flat or lower to start the year, Berg said.
Of course, a trip abroad is likely to be more costly on a dollar basis than one closer to home: The average round-trip U.S. flight cost about $300 in January, versus $685 to South America, $750 to Europe and about $1,100 to Asia, according to Hopper.
Average hotel rates abroad and in the U.S. are similar to 2024, according to Kayak.
Rental cars are 8% and 4% more expensive for international and domestic rates, respectively, it said.

Why Asia is ‘the best bargain’

Sapporo, Japan.
Sergio Formoso | Moment | Getty Images

Price largely depends on when people book and plan to travel.
For example, travel to Asia is the cheapest it’s been in three years, Kayak found. Average airfare to the continent is down 7% year over year, it said.
“Asia continues year over year to look like the best bargain,” Berg said.
Even some places that are red-hot with interest from travelers — including Sapporo and Osaka, Japan — are shaping up to be cheaper.
Search interest in Sapporo, for example, is up 31% year over year, but average airfare is down 19%, to $1,230, according to Kayak. Fares to Osaka, Japan’s “gastronomic capital,” are down 14% to $1,233, it said.
Tokyo is the most-searched international destination of 2025, it said.
Hotel room rates advertised in Asia-Pacific are expected to be 11% lower in the first half of 2025 relative to the same period of 2024, according to Lighthouse, a hospitality market research firm.

A ‘new market equilibrium’ for airfare

Daniel Garrido | Moment | Getty Images

Airfare to Asia-Pacific destinations is pulling back from high levels following the Covid-19 pandemic, Berg said.
Asian nations were generally slower to reopen their borders and drop Covid restrictions relative to other countries. Now, airlines are adding flight routes, boosting supply and lowering seat prices, Berg said.
“We have to see what the new market equilibrium will be,” Berg said.
Jet fuel prices — a major input cost for airlines — were down 11% in January from last year, Hopper said.
Like Asia, travel to the Caribbean is also the cheapest in three years, with airfare down 17% compared with 2024, according to Kayak.

Hotel deals more likely for off-season travel

Globally, hotel prices will vary widely, and established locales such as Paris, London, and parts of Asia such as Tokyo and Bangkok, Thailand, are “expected to reflect strong demand,” Melanie Fish, vice president of global public relations for Expedia Group, wrote in an e-mail.
“Meanwhile, emerging destinations or less-crowded spots may offer lower rates,” she said.
Hotel deals are “more likely” in off-peak seasons than peak periods such as spring break, summer or the holidays, particularly in areas with consistently high demand, Fish said.
Another factor helping travelers’ wallets abroad: the strength of the U.S. dollar versus many international currencies, she said.
Argentina, Japan, Mexico, Brazil and Hungary are among the top destinations where the dollar can stretch furthest, “making activities, dining and accommodations more budget-friendly,” Fish said.

Tips for saving money on travel in 2025

Colton Stiffler | Moment | Getty Images

There are some ways consumers can reliably save money on travel expenses.
1. Flexibility is ‘key’
“Flexibility is really the key to saving on travel,” Berg said.
This applies to many aspects of travel, including destination, the time of year you visit that locale and the days of the week you travel, experts said.
For example, it’s generally cheaper to fly midweek. Hotel stays have a similar dynamic. The bottom line: Weekends are probably pricier.
“Adjusting your [hotel] stay to midweek instead of weekends or traveling during the off-season can lead to substantial savings,” Sally French, a travel expert at NerdWallet, wrote in an e-mail.
Seasonality has a “huge effect” on flight costs, Fish said.

A bucket-list trip to Europe in August will be expensive and crowded, but traveling in September or October can save you 30%, Berg said. Visit a city instead of taking a beach trip during spring break, or wait until fall to head to Europe, Fish recommended.
Experts also recommend travel “dupes,” a less-trodden but similar alternative to a popular destination.
Also be open to alternative airports, French said.
“Many cities are served by multiple airports,” she said. “Rather than fly into, say San Francisco International Airport, consider flying into Oakland International Airport, which is a similar distance to most parts of the city for a trip to San Francisco.”
2. Book at the right time
Domestic flights are often cheaper when bought about one to three months ahead, French said. International travelers should book two to eight months in advance.
Last-minute airfare deals are rare, so book in advance for maximum availability and generally lower prices, she said.
The logic isn’t always the same for hotels: Travelers can sometimes find last-minute deals on room rates in certain markets, Fish said.
3. Book directly with your hotel
Many hotels offer price-match guarantees or loyalty member discounts that aren’t available on third-party booking sites, French said.
“Third-party booking sites can be great to browse and compare hotels against each other on that site, but once you’ve narrowed down the hotel you want to book, check its price elsewhere (including the direct hotel website, or even bank travel portals),” she wrote in an e-mail.
4. Set flight alerts
Use tools such as Google Flights or Hopper to monitor prices and snag deals when fares drop, French said. More

Among the changes in store once President-elect Donald Trump takes office could be the closure of the Federal Deposit Insurance Corporation or the Consumer Financial Protection Bureau.
There is value in downsizing these agencies, some experts say, although abolishing either could increase consumers’ exposure to risk.

Sweeping changes may be in store once President-elect Donald Trump takes office. Among them could be the closure of numerous federal agencies and regulators.
Trump will be sworn in for a second nonconsecutive term in the White House on Jan. 20. Already, he has suggested major cuts to federal spending.

To that end, Trump named Elon Musk and Vivek Ramaswamy co-chairs of a new outside advisory board dubbed the Department of Government Efficiency, or DOGE. 
As part of its agenda, advisors to the government-efficiency group reportedly inquired about the possibility of shrinking or dismantling the Federal Deposit Insurance Corporation, or FDIC, according to a December report in The Wall Street Journal. In a Nov. 27 post on X, Musk also suggested the White House should “delete” the Consumer Financial Protection Bureau, another independent agency. “There are too many duplicative regulatory agencies,” he wrote in the post.
Trump’s transition team did not respond to a request for comment.

The future of the FDIC

Most bank account holders take for granted the fact that their deposits are insured.
Since its creation during the Great Depression, the FDIC has secured up to $250,000 per depositor, per bank, in each account ownership category. And over nearly a century, no depositor has lost FDIC-insured funds due to a bank failure. 

“That’s one of its legacies,” said William Isaac, who was named chairman of the FDIC by former President Ronald Reagan and headed the agency during the banking crisis of the 1980s.

In place of the independent agency, the Trump administration could task the Treasury Department with overseeing deposit insurance, according to reports.
“There may be great value in downsizing or eliminating overlapping agencies while still keeping key underlying functions they serve,” said Tomas Philipson, a professor of public policy studies at the University of Chicago and former acting chair of the White House Council of Economic Advisers. “For example, one proposal is to have Treasury insure bank-deposits rather than an additional agency such as FDIC.”
“It’s important to separate what government activities are being performed from who or how many agencies are in charge,” Philipson said. “Holding constant the activities being regulated, the fewer agencies the better.”
More from Personal Finance:30 million people may qualify for IRS free Direct File programBiden forgives student loans for 150,000 more borrowersHow much you can save by not drinking during ‘dry January’
“I think it’s a terrible idea,” Isaac said of abolishing the agency. “The FDIC has brought about stability like we’ve never seen before.”
Others also argue that eliminating the FDIC would undermine the consumer lending system and leave some savers vulnerable.
“Getting rid of the FDIC would be a disaster for the U.S. economy and its preeminent status as a financial center,” said Brett House, economics professor at Columbia Business School. “Deposits are an abundant, cheap source of capital for American financial institutions.”
“Large banks may do fine without FDIC protections on their clients. But an end to federal insurance on them would be a serious drag on regional financial institutions that provide a major source of consumer lending and small-business financing,” House said.
Ultimately, because Congress controls the appropriation of federal funds, any proposal to eliminate the FDIC or any other agency would require congressional action.

The future of the CFPB

The Consumer Financial Protection Bureau has a much shorter track record than the FDIC. The watchdog group was created by Congress on the heels of the 2008 financial crisis to enforce consumer protection laws. 
Since then, the CFPB has issued roughly 35 regulatory reports, including a 2024 effort to insulate Americans from credit card late fees.
“The CFPB is a recent creation and U.S. markets clearly functioned well for decades without it,” said Columbia’s House. “But recent increases in market concentration and power for a handful of firms in several major economic sectors makes the CFPB a critical force in balancing business and consumer interests.”

Unlike the FDIC, the CFPB draws its funding from the Federal Reserve system. Because it does not rely on an annual appropriation from Congress, it is somewhat insulated from political pressure.
However, the Consumer Bankers Association says the agency has increasingly “advanced ideologically-driven policies,” particularly over the last four years.
“The incoming administration and Congress have a unique and important opportunity to institute meaningful reforms to the CFPB, in both the immediate and long-term, that can help transform the agency into the credible and durable regulator Americans deserve,” CBA President and CEO Lindsey Johnson said in an email.
The CBA also released a white paper Tuesday outlining recommended changes to the CFPB, which include repealing or rescinding recent rules and guidance.
Consumers, however, are largely in favor of the CFPB’s actions, according to advocates. The agency protects “hard-working people from predatory practices and discrimination in financial services,” Richard Dubois, executive director of the National Consumer Law Center, said in a statement.
If the CFPB is dismantled, that could mean consumers would see some of those protections overturned — and it’s unclear what government entity, if any, might pick up the agency’s efforts for new or emerging issues. The CFPB has been investigating digital payment apps and buy now, pay later services, for example.
But there may still be room for streamlining, Isaac said.
“Surely we are wasting a lot of money. Anything we can cut out that’s not necessary — that’s fat — needs to be cut,” he said.
Subscribe to CNBC on YouTube. More

KBR headquarters in Houston, TX.
Courtesy: KBR

Company: KBR Inc (KBR)

Business: KBR provides scientific, technology and engineering solutions to governments and companies around the world. The company operates through two segments: Government Solutions and Sustainable Technology Solutions. Its Government Solutions (GS) business segment provides full life-cycle support solutions to defense, intelligence, space, aviation and other programs and missions for military and other government agencies in the United States, the United Kingdom and Australia. Its Sustainable Technology Solutions (STS) business segment is anchored by process technology that spans ammonia/syngas/fertilizers, chemical/petrochemicals, clean refining and circular process/circular economy solutions.
Stock Market Value: $7.91B ($59.36 per share)

Stock chart icon

KBR shares over the past 12 months

Activist: Irenic Capital Management

Ownership: >1%
Average Cost: n/a
Activist Commentary: Irenic Capital was founded in October 2021 by Adam Katz, a former portfolio manager at Elliott Investment Management, and Andy Dodge, a former investment partner at Indaba Capital Management. Irenic invests in public companies and works collaboratively with firm leadership. The firm’s activism has thus far focused on strategic activism, recommending spinoffs and sales of businesses.

What’s happening

On Dec. 19, 2024, Irenic announced that it plans to push KBR to separate its Sustainable Technology Solutions segment from its Government Solutions segment.

Behind the scenes

KBR is a Houston-based science, technology and engineering solutions company that provides services to governments and companies globally. The company is divided into two segments: Government Solutions (GS) and Sustainable Technology Solutions (STS). The GS segment operates as a government contractor providing solutions to defense, intelligence, space, aviation and other missions for militaries and government agencies. The STS segment serves both government and private sector clients with its extensive portfolio of energy and sustainability-focused technology in four primary verticals: ammonia/syngas, chemical/petrochemicals, clean refining and circular process/circular economy solutions. While both units have established a strong foothold in their respective end markets, they are fundamentally different. Government Solutions is a low-margin mature business, while Sustainable Technology Solutions is a high-margin growing business. The GS segment has experienced revenue contraction since FY21 and has adjusted earnings before interest, taxes, depreciation and amortization margins of about 10%. Conversely, STS has grown revenue by an average of 16.7% annually since FY21 and has margins of approximately 20%.

In recent weeks, government contractors, including KBR, have experienced sector-wide de-rating in response to perceived risks associated with the incoming Trump administration. Investors have been speculating that the new Department of Government Efficiency (DOGE), with its mandate to slash federal spending, already pledging to trim $2 trillion from the federal budget, could result in a material decline in government contractors’ profitability. As a result, between Election Day and the report that Irenic had built a position in the company, shares of KBR fell more than 18%. However, KBR may have been unduly punished by DOGE speculation. In reality, KBR appears to be more insulated from these threats than the market currently perceives. First, while the company’s GS business does account for 75% of KBR’s revenue, it contributed less than half of its operating income in FY23. In addition, 25% of the GS business is international, primarily in the UK, sheltered from the potential effects of DOGE. Looking at the remaining 75% of that segment in the U.S. market, close analysis reveals that only relatively small portions of KBR’s services are expected to face any related estimated cost pressures. While much is currently uncertain, the threats to the GS segment seem, at this moment, overblown. Moreover, the STS segment may be a beneficiary of the incoming administration’s plans. Under the Biden administration, there was a moratorium on export permits for LNG plants and several projects were put on hold. The Trump administration plans to reverse this, which could be a tailwind for KBR as the company is well-positioned to win new and existing projects.
Perhaps enticed by KBR’s discounted valuation following the recent exogenous share price shock, Irenic has now entered the picture. Irenic has accumulated a position of more than 1% in the company and is urging management to separate its STS segment. These are fundamentally different businesses with distinct support needs, management requirements and end markets. Companies that don’t belong together should be separated for several reasons: (i) each can attract the appropriate shareholder base and be awarded the proper multiple; (ii) each can dedicate management focus and compensation to be more aligned with specific business needs; and (iii) separation can result in a reduction of corporate overhead costs, producing leaner and more efficient entities. KBR currently trades around 11.5 times enterprise value to the last 12 months’ adjusted EBITDA. Looking at peer companies, those of GS typically trade in this range, but those most like STS fetch an average multiple of 14-15 times EBITDA. Separating the two should re-rate the STS business creating value for shareholders before any cost savings from the separation. By separating the two businesses, there would be no need for a lot of the corporate costs the company presently incurs, which could result in a $50 million savings that goes right to the bottom line. Finally, ahead of any value creation, the company could buy back shares to create additional shareholder value. While each value creation lever on its own might not be incredibly compelling, the combination could result in a 50% increase in shareholder value.
Irenic is not the only shareholder who thinks a separation makes sense; many other shareholders share this view. To put it differently: Keeping the two companies together makes no sense. A few years ago, it would’ve been fair to argue that a spin-off of STS wasn’t feasible because of the unit’s size and youth. In 2021, the segment delivered an operating loss of $30 million and in the years after, management successfully made this argument saying the segment needed to be bigger to spin off. But STS now generates close to $400 million of EBITDA, and it is time for management to walk the walk. Irenic likes to work behind the scenes with management and use the power of persuasion to win the day. We expect the firm will be doing that here right up to either the announcement by KBR of a strategic review or the company’s nomination deadline on Feb. 14, 2025, whichever comes first. If no satisfactory announcement is made by Feb. 14, we would expect Irenic to do something that it has never had to do before – launch a proxy fight. However, given the shareholder support for a separation and the fact that there is an empty board seat (General Lester L. Lyles recently announced he will retire from the board effective after the 2025 annual meeting) we do not expect it will come to that. If Irenic is given a seat on the board, it will likely be for an independent director with relevant industry experience as opposed to an Irenic principal.
If KBR does pursue a strategic review, we would be remiss if we did not mention a similar and relevant situation. Elliott Investment Management has recently advocated for the separation of Honeywell into two companies, and Honeywell subsequently announced a strategic review of its businesses. Honeywell could be a potential strategic acquirer of parts or the entirety of KBR. Irenic’s co-founder, Adam Katz, was a former employee of Elliott Investment Management, and I am sure he still knows people over there.
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

Direct File, the IRS’ free tax filing program, has expanded to limited taxpayers in 25 states for 2024 returns.
But the program’s future remains uncertain amid pushback from Republicans who will soon control the White House and Congress.
More than 130 Democrats this week urged Trump’s picks for Treasury secretary and IRS commissioner to preserve Direct File.

Hirurg | E+ | Getty Images

With the start of tax season approaching, Democratic and Republican lawmakers are split on the future of Direct File, the IRS’ free tax filing program.
Direct File, which recently expanded to limited taxpayers in 25 states, processed roughly 140,000 returns in 2024 during the pilot that launched mid-season. The pilot covered simple returns in 12 states.

The program has been controversial among Republicans, who have pushed to end the free filing service. The critique has raised questions about Direct File’s future, particularly under GOP control of the White House, Senate and the House of Representatives. 
More from Personal Finance:Here’s how the child tax credit could change in 2025Year-end bonuses rise — but fewer workers are getting them, report findsNow is an ideal time to do a financial reset, advisor says. Here’s why
During his Senate confirmation hearing on Thursday, Scott Bessent, President-elect Donald Trump’s pick for Treasury secretary, was asked about the future of Direct File.
If confirmed, “I will commit that for this tax season that Direct File will be operative,” said Bessent, without commenting on future years.

Bessent’s comments come one day after more than 130 Democrats, led by Sens. Elizabeth Warren, D-Mass., and Chris Coons, D-Del., voiced support for Direct File.

“Direct File is making the process of interacting with the government more efficient, a goal we all can agree on,” the Democratic lawmakers wrote in a letter to Bessent and Billy Long, Trump’s pick for IRS commissioner.
The pilot program saved consumers an estimated $5.6 million in federal tax preparation fees and could save billions in the future, the Democratic lawmakers wrote. “We disagree with our colleagues who are calling on the President to pull the plug.”

Rep. Adrian Smith, R-Ne., along with 27 House Republicans in December wrote a letter to Trump, urging the president-elect to end Direct File via a day-one executive order.
“The program’s creation and ongoing expansion pose a threat to taxpayers’ freedom from government overreach, and its rollout and structural flaws have already come at a steep price,” the Republican lawmakers wrote. 
While the program launched mid-season in 12 states last year for only simple returns, Republicans have continually pointed to the roughly 140,000 returns filed compared to total eligible filers.
The cost for Direct File through the pilot was $24.6 million, the IRS reported in May 2024. Direct File operational costs were an extra $2.4 million, according to the agency.
Over the past year, Republican lawmakers from both chambers have introduced legislation to halt the IRS’ free filing program. In January 2024, attorneys general from 13 states described Direct File as “unnecessary and unconstitutional” in a letter to the Treasury Department. More