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    Biden wants to make student loan forgiveness tax-free permanently

    The American Rescue Plan Act of 2021 made student loan forgiveness tax-free until Dec. 31, 2025.
    President Joe Biden wants to make that provision permanent.
    Student loan forgiveness first became tax-free at the federal level in March 2021 due to a provision included in the $1.9 trillion federal Covid-19 stimulus package that Biden signed into law.

    U.S. President Joe Biden speaks at the Pieper-Hillside Boys & Girls Club in Milwaukee, Wisconsin, on March 13, 2024.
    Sara Stathas | Bloomberg | Getty Images

    How student loan forgiveness used to be taxed

    Before that Covid-era change, any student loan debt canceled by the government was considered taxable and levied at the borrower’s normal income tax rate.
    The federal tax bill could be hefty.
    According to a rough estimate by higher education expert Mark Kantrowitz, under previous tax rules, a borrower with a remaining balance of $10,000 after 20 or 25 years of payments could have to write the IRS a check for $1,200, assuming they’re single and have an income less than $35,000. Yet, depending on a borrowers’ circumstances, their federal tax bill could be as high as $15,400, Kantrowitz said.
    Borrowers can also owe state taxes on the forgiven debt.

    ‘Replacing education debt with tax debt’

    Many student loan borrowers who get forgiveness aren’t able to afford a tax bill, Kantrowitz said.
    “These borrowers have had low income for decades and are unlikely to have any assets,” he said. “The tax liability might be as much as half of their annual income, or more, on top of their current tax liability.”
    If borrowers sign up for a payment plan with the IRS, they’re merely “replacing education debt with tax debt,” Kantrowitz said.
    The millions of borrowers enrolled in income-driven repayment plans would be most affected by ending taxation of forgivable education debt. These plans, which cap a borrowers’ monthly bill at a share of their discretionary income, lead to debt erasure after 10 to 25 years of payments. There are currently four different plans, each with different rules.
    Other student debt forgiveness plans, including a popular one for public servants and another that cancels the debt for those with serious disabilities, are already nontaxable.

    The tax rules around forgivable student debt could become especially important in the coming months as the Biden administration rolls out its revised student loan forgiveness plan, which has become known as Biden’s “Plan B.”
    The Supreme Court struck down the administration’s first attempt to forgive student debt in June.
    Regardless of the federal policy, it’s possible a borrower could still face state taxes on their forgiven education loans.

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    The best time to sell your home — in 2023, listings in this period sold for $7,700 more, research finds

    While spring is known to be the season that kicks off the housing market, events from recent years have changed the trends, experts say.
    While housing supply is already beginning to recover, a seller may want to wait for June.
    In 2023, homes listed in the first two weeks of June sold for 2.3% more, a $7,700 boost on a typical U.S. home, according to a new Zillow analysis.

    Sturti | E+ | Getty Images

    Spring, the season when home buying and selling activity kicks off, is around the corner. 
    Available housing supply is already rebounding: The number of new listings jumped 14.8% from a year ago, the largest annual gain since May 2021, according to new data from Redfin, a real estate site.

    Buyers are typically looking to land a new home before their children’s new school year while a seller’s house benefits from the fresh flowers and renewed greenery post-winter. 
    “It’s sort of an ideal time for both buyers and for sellers, and that’s why we just see a lot more activity that time of year,” said Amanda Pendleton, a home trends expert at Zillow Group.
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    However, sellers might benefit from waiting until June to put up their property for sale.
    In 2023, homes listed in the first two weeks of June sold for 2.3% more, a $7,700 boost on a typical U.S. home, according to a new Zillow analysis.

    “We’ve learned that real estate cycles don’t always happen [at this] time of year,” said Melissa Cohn, regional vice president at William Raveis Mortgage.

    Spring market was ‘flipped on its head’

    The typical spring home shopping season has been “flipped on its head” due to an unusual market over the past four years, Pendleton said.
    Trends started shifting when the country locked down in March 2020 at the start of the Covid-19 pandemic: “There was no market that year,” Cohn said.
    Throughout 2021, buyers were purchasing homes no matter the month or season, given ultra-low mortgage rates and flexible remote-work policies that led many consumers to relocate. Then when March 2022 came around, the market stalled as mortgage rates began to rapidly increase, Pendleton explained.
    While buyers were still holding back last year, there was a slight return to seasonal behaviors, she said.
    While some experts may see a continued trend toward normalization, “the good old-fashioned spring selling season” hasn’t been seen in several years, Cohn said.
    “I think people have become sort of more year-round in terms of their attitude towards real estate,” she added.

    Rate cuts could ‘ignite a summer selling season’

    In fact, while there may be more buyers and sellers in the coming weeks, a second surge is anticipated in the summer — an “extended home shopping season,” Pendleton said.
    With the Federal Reserve expected to begin cutting rates as soon as the summer, there could be a renewed surge in buyer demand, experts say.
    “People are hoping the first rate cut will be at the beginning of June. That hopefully will ignite a summer selling season,” Cohn said. “The direction of mortgage rates over the course of the next two years is probably a downward one.”

    However, when mortgage rates begin to come down, buyer demand will rise, Pendleton said.
    “We could see a bit of a bump in terms of home prices with that added competition,” she added.
    Meanwhile, home prices are still elevated.
    The median U.S. home sale price is $412,778, up 6.6% from a year ago, according to Redfin data, which is not seasonally adjusted. The recent boost in supply isn’t enough to meet the pent-up demand in the market, according to Redfin.
    Yet if you can afford to buy a property now, it may be smart to do so and refinance later. That allows you get in and out of the real estate market, Cohn said, “before the mad rush happens and rates really start to come down.” More

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    How to avoid the ‘survivor’s penalty’ before a spouse passes

    Women and Wealth Events
    Your Money

    After a spouse dies, the survivor may face higher future taxes when switching to single filer for federal taxes.
    But you can minimize the possible tax hit with advanced planning, such as Roth individual retirement account conversions, account ownership and beneficiaries.

    Jessie Casson | Digitalvision | Getty Images

    It’s hard to lose a spouse, and a costly surprise makes it even more difficult, especially for older women — higher taxes. But financial experts say there are several ways to prepare.
    In 2022, there was a 5.4-year life expectancy gap between U.S. sexes, according to data from the Centers for Disease Control and Prevention. Life expectancy at birth was 74.8 years for males and 80.2 years for females. 

    The gap often leads to a “survivor’s penalty” for older married women, which can trigger higher future taxes, certified financial planner Edward Jastrem, chief planning officer at Heritage Financial Services in Westwood, Massachusetts, previously told CNBC.

    More from Women and Wealth:

    Here’s a look at more coverage in CNBC’s Women & Wealth special report, where we explore ways women can increase income, save and make the most of opportunities.

    ‘The biggest shock’ for widows

    The year a spouse dies, the survivor can file taxes jointly with their deceased spouse, known as “married filing jointly,” unless they remarry before the end of the tax year.
    After that, many older survivors file taxes alone with the “single” filing status, which may include higher marginal tax rates, due to a smaller standard deduction and tax brackets, depending on their situation.

    For 2024, the standard deduction for married couples is $29,200, whereas single filers can only claim $14,600. (Rates use “taxable income,” which is calculated by subtracting the greater of the standard or itemized deductions from your adjusted gross income.)
    Higher taxes can be “the biggest shock” for widows — and it may be even worse once individual tax provisions sunset from former President Donald Trump’s signature legislation, George Gagliardi, a CFP and founder of Coromandel Wealth Management in Lexington, Massachusetts, previously told CNBC.

    Before 2018, the individual brackets were 10%, 15%, 25%, 28%, 33%, 35% and 39.6%. But through 2025, five of these brackets are lower, at 10%, 12%, 22%, 24%, 32%, 35% and 37%.

    Typically, the surviving spouse inherits the deceased spouse’s individual retirement accounts, and so-called required minimum distributions are about the same. But the surviving spouse now faces higher tax brackets, Gagliardi said.
    “The larger the IRAs, the bigger the tax problem,” he said.

    When to use partial Roth conversions

    Some surviving spouses may face higher future taxes, but it’s important to run tax projections before making changes to the financial plan, experts say.
    Spouses may consider partial Roth IRA conversions, which transfers part of pretax or nondeductible IRA funds to a Roth IRA for future tax-free growth, Jastrem said.

    This is often best done over a number of years to minimize the overall taxes paid for the Roth conversions.

    George Gagliardi
    Founder of Coromandel Wealth Management

    The couple will owe upfront taxes on the converted amount but may save money with more favorable tax rates. “This is often best done over a number of years to minimize the overall taxes paid for the Roth conversions,” Gagliardi said.

    Check investment accounts

    It’s always important to keep account ownership and beneficiaries updated, and failing to plan could be costly for the surviving spouse, Jastrem said.
    Typically, investors incur capital gains based on the difference between an asset’s sales price and “basis,” or original cost. But when a spouse inherits assets, they receive what’s known as a “step-up in basis,” meaning the asset’s value on the date of death becomes the new basis.

    A missed step-up opportunity could mean higher capital gains taxes for the survivor.

    Edward Jastrem
    Chief planning officer at Heritage Financial Services

    That’s why it’s important to know which spouse owns each asset, especially investments that may be “highly appreciated,” Jastrem said. “A missed step-up opportunity could mean higher capital gains taxes for the survivor.”

    Reduce taxes on IRA distributions

    If the surviving spouse expects to have enough savings and income for the remainder of their life, the couple may also consider beneficiaries other than the spouse, such as children or grandchildren, for tax-deferred IRAs, Gagliardi said.
    “If planned correctly, it can reduce the overall taxes paid on the IRA distributions,” he said. But nonspouse beneficiaries need to know the withdrawal rules for inherited IRAs.
    Before the Secure Act of 2019, heirs could “stretch” IRA withdrawals over their lifetime, which reduced year-to-year tax liability. But certain heirs now have a shortened timeline due to changes in required minimum distribution rules. More

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    What is shrinkflation? Here’s why consumers may be getting less for their money

    Everyone from President Joe Biden to Cookie Monster is taking a stand against shrinkflation.
    One legislative proposal aims to curb the practice of downsizing consumer products.
    In the meantime, there are steps consumers can take to spot the phenomenon and reduce their grocery bills.

    Pixelseffect | E+ | Getty Images

    Some grocery store products are providing less for your money. And everyone from President Joe Biden to Cookie Monster has noticed.
    Blame shrinkflation. The term — which is increasingly used in conversation — refers to products becoming smaller in size, weight or quantity as their prices stay the same or even increase.

    Biden took companies to task for shrinking sports drinks and ice cream cartons and providing fewer chips in snack bags, in a pre-Super Bowl video posted on social media.
    At the State of the Union, he again took a stand against shrinkflation, complaining that Snickers bars have become smaller.
    Mars, the company that makes Snickers, denies the allegation. “The size of Snickers singles and share bars in the U.S. hasn’t been reduced,” a spokesperson for the company said in a statement.

    In a more lighthearted exchange, when Cookie Monster posted “Me hate shrinkflation!” on X earlier this month, the White House responded, “C is for consumers getting ripped off.”
    “President Biden is calling on companies to put a stop to shrinkflation,” the White House said.

    The president has called for a bill to be passed that would give the Federal Trade Commission the authority to put regulations into effect to curb shrinkflation. The proposal would also make it possible for the FTC and state attorneys general to engage in civil actions against companies that engage in the practice.

    Where consumers may see shrinkflation

    For now, it’s up to consumers to spot the changes companies may make to their products.
    Certain products tend to be more susceptible to charges of shrinkflation, according to Bureau of Labor Statistics data cited in a recent Senate report.
    Household paper products had the largest measured price increase change due to shrinkflation from January 2019 to October 2023, with a 10.3% increase.
    Other categories that saw notable changes in that time frame include snacks, which increased by 9.8%; household-cleaning products, up 7.3%; coffee, 7.2%; candy and chewing gum and ice cream and related products, 7%.
    Noticing the changes requires having a keen eye and diligently paying attention, according to Mara Weinraub, senior lifestyle editor of groceries at food website The Kitchn.
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    It can be easier to track those changes if you typically buy your groceries online or if you belong to a grocery store’s loyalty program. Some families even track their grocery store shopping by hand, Weinraub said.
    If you’re watching for changes, you’re more likely to spot when a bag of popcorn shrinks from 5 ounces to 4.5 ounces, she said.
    Shrinkflation isn’t necessarily new. But there are reasons why consumers are paying more attention to it now, Weinraub said. Social media makes it easier to share experiences with downsized products. Meanwhile, companies are generally posting profits while engaging in this practice, she said.
    “There’s a layer of deception that they feel like, ‘Oh, this is something that companies are trying to do under the radar without us noticing,'” Weinraub said.

    Why critics say shrinkflation is the wrong focus

    While shrinkflation is now under the political spotlight, not all experts agree the emphasis is correctly placed.
    Inflation peaked at 40-year highs in 2022. While the rate of inflation has come down, it is still higher than the Federal Reserve’s target.
    The Bureau of Labor Statistics tracks changes in the sizes of consumer products in order to accurately capture the changes in prices for goods and services in the consumer price index.
    While consumers may notice shrinkflation at the grocery store, it has a very small impact on the overall inflation picture they face, the Bureau of Labor Statistics said in 2023 article.

    Shrinkflation is rarer than politicians are depicting and not as influential on consumers’ lives, argues economist Veronique de Rugy, senior research fellow at the Mercatus Center at George Mason University.
    “Ultimately, consumers’ lives are harder because of inflation,” de Rugy said.
    Notably, the categories most affected, such as snack products, are areas where consumers may refrain from purchases or substitute other goods, she said.
    Most economists are not paying close attention to shrinkflation, contending its effects are eventually absorbed in inflation data.
    But “I understand how with the average person it would frustrate and annoy them,” said David Doyle, head of economics at Macquarie.

    How to be a smarter shopper at the grocery store

    Customers shop at a Costco store on August 31, 2023 in Novato, California.
    Justin Sullivan | Getty Images News | Getty Images

    While consumers cannot control the changes companies make to grocery store products, they can take steps to be more mindful of how much they are spending.
    Switching to a different brand may be one way to save, according to The Kitchn’s Weinraub, particularly by opting for store brands. Many stores are expanding their private label lines, which are generally cheaper than brand names, she said.
    Taking the time to do some comparison shopping can also help, Weinraub said.
    One staff writer at The Kitchn experimented by shopping in person at the grocery store for one month and then buying exclusively online for another month. She was shocked when she compared her receipts, discovering she spent over twice as much in person, Weinraub said.
    Avoiding those in-person impulse purchases may help you save more than you think, she said.
    Other shoppers have switched retailers and found that change “literally saved them hundreds of dollars,” Weinraub said.
    “These strategies become increasingly important, as the prices continue to either maintain or creep up, or you seem to be getting less for the same amount of money,” she said.
    “You do need to get more creative to stretch your dollar further.” More

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    Top Wall Street analysts prefer these three stocks for the long haul

    In this photo illustration, the CrowdStrike Holdings, Inc. logo is displayed on a smartphone screen. 
    Rafael Henrique | SOPA Images | Lightrocket | Getty Images

    Investors’ worries about the prospect of higher-for-longer interest rates have made a comeback, pulling the major averages lower this past week.
    Even as markets seem turbulent for now, it’s key for investors to keep a long-term focus and to find stocks that can offer attractive returns for years to come.

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

    CrowdStrike

    This week’s first stock pick is cybersecurity provider CrowdStrike (CRWD). The company recently impressed investors with strong quarterly results and upbeat guidance. It also announced that it would acquire Flow Security, which provides cloud data runtime security solutions.  
    Mizuho analyst Gregg Moskowitz highlighted that CrowdStrike is experiencing solid traction for its Falcon Cloud Security, Identity and next-gen LogScale SIEM (security information and event management) offerings, with management disclosing that these products collectively contributed more than $850 million to annual recurring revenue.
    The analyst also noted that the company closed several large transactions in the fourth quarter, including more than 250 deals with a value of greater than $1 million. Additionally, deal volume surged 30% year over year across all customer cohorts.
    Explaining his bullish stance, Moskowitz said, “CRWD’s cloud platform remains very differentiated, its GTM [go-to-market] is unrivaled,” and the company is witnessing more success beyond the traditional endpoint security markets.

    The analyst views CrowdStrike as a generative artificial intelligence beneficiary. Moskowitz reiterated a buy rating on CRWD stock and raised the price target to $390 from $360.
    Moskowitz ranks No. 132 among more than 8,700 analysts tracked by TipRanks. His ratings have been profitable 62% of the time, with each delivering an average return of 16.5%. (See CrowdStrike Ownership Structure on TipRanks) 

    Nike

    We move to athletic footwear and apparel maker Nike (NKE). Earlier this month, Guggenheim analyst Robert Drbul reiterated a buy rating on Nike stock with a price target of $130, adding it as a “best idea.” The analyst thinks that the pullback in the stock — which is down more than 8% in 2024 — offers an attractive entry point with a favorable risk/reward profile.
    “We believe Nike is laying the groundwork for impactful launches of new product (led by basketball, but also running) to deliver an acceleration in top line growth in 2H24 and into 2025,” said Drbul.
    The analyst noted the company has been increasing its focus on the highly competitive running category after losing ground over the past few years. He anticipates that the category’s growth will be supported by an array of new launches, including the Pegasus 41.
    Drbul also expects the Nike brand to be highly visible at the upcoming 2024 Summer Olympics. Further, he thinks that the Jordan brand continues to be strong and that it presents a large opportunity for the company in the international, women’s and kids’ segments. He highlighted that the Jordan brand is on the path to emerge as the second-largest brand in North America.
    Additionally, the analyst sees the possibility of gross margin expansion, with higher prices, favorable ocean freight rates and supply chain improvements more than offsetting the impact of increased product costs.
    Drbul holds the 565th position among more than 8,700 analysts tracked by TipRanks. His ratings have been profitable 59% of the time, with each delivering an average return of 7.9%. (See Nike Stock Buybacks on TipRanks) 

    BJ’s Wholesale Club

    Warehouse chain BJ’s Wholesale Club (BJ) recently reported mixed results for the fourth quarter. The company’s earnings surpassed analysts’ consensus estimate, but revenue, which grew 8.7% year over year, fell short of expectations.
    Nonetheless, Baird analyst Peter Benedict was impressed with the company’s performance. He reiterated a buy rating on BJ stock and increased the price target to $90 from $80. The analyst noted that the company delivered encouraging top-line key performance indicators, including traffic and units, even as disinflation continued to weigh on the average basket size.
    The analyst thinks that BJ’s is making good progress in transforming its general merchandise business through various efforts, including enhancing its assortment and product presentation and ramping up its marketing efforts. Interestingly, general merchandise comps are expected to outpace grocery comps in FY24.
    Benedict also highlighted BJ’s solid real estate pipeline and its plan to open 12 clubs this year. Further, he noticed the retailer’s healthy membership trends, with membership fee income increasing 6.5% in the quarter and the tenured renewal rate remaining strong at 90%.  
    “With a healthy balance sheet and still-reasonable valuation, we continue to highlight BJ as an attractive long-duration mid-cap staple GARP [growth at a reasonable price] idea,” the analyst said.    
    Benedict ranks No. 74 among more than 8,700 analysts tracked by TipRanks. His ratings have been profitable 69% of the time, with each delivering an average return of 15.2%. (See BJ’s Wholesale Technical Analysis on TipRanks)  More

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    What investors need to know about crypto taxes amid the latest bitcoin rally

    Smart Tax Planning

    Some tax professionals are bracing for more crypto scrutiny as the IRS beefs up digital asset service, reporting, compliance and enforcement programs.
    Experts cover how to answer the “digital assets” question on your return, calculate crypto taxes and handle reporting.
    When you trade digital currency or sell it at a profit, it may be subject to capital gains or regular income taxes, depending on the “holding period” or how long you owned the asset.

    Chesnot | Getty Images

    Loading chart…

    Whether you’re a longtime crypto investor or recently purchased digital assets, here are some key things to know from crypto tax experts. 

    How to answer Form 1040 ‘digital assets’ question

    Cryptocurrency has become a priority area for the IRS, and the agency shared guidance in January about reporting digital currency this tax season.
    Since tax year 2019, the IRS has collected crypto data on tax returns with different versions of a yes-or-no question. For 2023, there’s a “digital assets” question on the front page of Form 1040, along with returns for estates and trusts, partnerships, corporations and S corporations.

    More from Smart Tax Planning:

    Here’s a look at more tax-planning news.

    However, many crypto investors don’t realize the term “digital assets,” which includes cryptocurrency, stablecoins, nonfungible tokens and more, applies to them, said enrolled agent Matt Metras, owner of MDM Financial Services. 

    For 2023, you must answer “yes” if you sold crypto; traded one coin for another; or received digital currency as a payment, reward or award, according to Form 1040 instructions. You could answer “no” if you bought crypto with U.S. dollars and still hold the asset.

    Yes-or-no questions are quite powerful.

    Andrew Gordon
    President of Gordon Law Group

    “Yes-or-no questions are quite powerful,” said Andrew Gordon, tax attorney, certified public accountant and president of Gordon Law Group.
    If you have crypto profits or income and select “no” for the digital assets question, the IRS could argue there’s “willfulness” in intentionally violating the law, Gordon said.
    However, the 2023 digital assets question does not apply to bitcoin futures ETFs or spot bitcoin ETFs, he said.

    How to calculate crypto taxes

    When you trade digital currency or sell it at a profit, it may be subject to capital gains or regular income taxes, depending on the “holding period” or how long you owned the asset. 
    “They’re treated the same as stocks or other property,” and the gain is the difference between your “basis” or purchase price and the value when you sell or exchange the asset, Gordon said. 
    If you hold crypto for more than one year, you’ll qualify for long-term capital gains of 0%, 15% or 20%, depending on your taxable income. By contrast, short-term capital gains or regular income taxes apply to assets owned for one year or less.

    Both brackets use “taxable income,” which you calculate by subtracting the greater of the standard or itemized deductions from your adjusted gross income.
    For higher earners, selling crypto after one year could “cut your rate in half,” which is why tracking your purchase date is so important, Gordon said.

    How crypto tax reporting works

    Many investors rely on tax forms to file returns every year. But it’s harder for crypto investors without reliable reporting, experts say. 
    For 2023, you may receive Form 1099-MISC for rewards or income, Form 1099-B for transactions or no forms at all, depending on the exchange.
    Plus, if you receive crypto tax forms, there can be basis reporting errors if you’ve moved currency from one exchange to another.
    The U.S. Department of the Treasury and IRS released proposed regulations, including a standardized Form 1099-DA for digital asset reporting, for transactions on or after Jan. 1, 2025.
    In the meantime, crypto investors should report activity based on personal record-keeping, which can be challenging with a high volume of activity, Metras said.
    “Once you have more than five transactions, trying to do it yourself in an Excel spreadsheet becomes overwhelming,” he said. More

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    Here’s why Social Security cost-of-living adjustments may be smaller in 2025 and beyond

    As inflation comes down, retirees will likely see lower Social Security cost-of-living adjustments.
    To prepare for smaller increases to their monthly checks, there are steps retirees can take to protect their income now.

    Peopleimages | Istock | Getty Images

    High inflation has prompted higher Social Security cost-of-living adjustments.
    But as the rate of price growth subsides, the annual increases for Social Security may fall in 2025 and beyond, predicts Mary Johnson, a Social Security and Medicare policy analyst at The Senior Citizens League, a nonpartisan senior group.

    In 2024, more than 66 million Americans are getting a 3.2% increase to their monthly Social Security checks. For retirees, the average increase is about $59 per month, according to The Senior Citizens League.
    That adjustment is far lower than the 8.7% COLA beneficiaries saw in 2023 or the 5.9% boost in 2022, both of which were the highest in more than 40 years.
    More from Personal Finance:Why gas is so expensive in CaliforniaCredit card users face ‘consequences’ from falling behindAfter Biden praises progress on inflation, economists weigh in
    The benefit boost beneficiaries saw in 2024 is still above the 2.6% average over the past 20 years, according to The Senior Citizens League.
    But that may be poised to change as the rate of inflation comes down.

    Early estimates for the 2025 Social Security COLA

    New government data points to a 2.4% Social Security COLA for 2025, The Senior Citizens League estimates, based on new government inflation data released this week.
    That estimate is subject to change. The Social Security Administration typically announces the COLA for the following year in October.
    The annual adjustment is calculated using third-quarter data from a subset of the consumer price index, the Consumer Price Index for Urban Wage Earners and Clerical Workers, or CPI-W. As of February, the CPI-W increased 3.1% over the past 12 months.
    “This is way early,” Johnson said. “It will change multiple times since the COLA is on the average inflation in the third quarter of the year against the previous year.”
    “A lot can happen between now and then,” she said.
    In the meantime, experts say there are steps retirees can take to help compensate for the prospect of lower benefit increases.

    Make the most of your cash

    While inflation is coming down, interest rates savers can earn on their cash are still the highest they’ve been in years.
    For retirees who have extra money in their monthly budget, it can be helpful to set those sums aside to help prepare for unexpected expenses that may crop up later, Johnson said.
    Online savings accounts are offering higher returns on cash. Certificates of deposit also provide a way to guarantee a certain return over a short- or long-term period even as interest rates come down.

    With inflation still elevated, it also helps to limit fixed expenses, as well as try to find ways to cut and save, said Lisa Featherngill, a certified financial planner and director of wealth planning at Comerica Wealth Management in Winston-Salem, North Carolina.
    “We highly suggest that people in retirement do an annual cash flow projection,” Featherngill said.
    That can help identify any difference between expected income and expenses.
    To make up the difference, retirees may use investment income, if they have it, or find other ways of cutting spending or generating returns on their cash, she said.

    Consider other sources of fixed income

    For the average American, Social Security replaces about 40% of the income they received while working, said Kelly LaVigne, vice president of consumer insights at Allianz Life, which specializes in annuities and life insurance.
    “You’ve got to get that other 60% from somewhere,” LaVigne said.
    It helps to invest your savings to grow for the future when you need to withdraw from that money, he said.
    Annuities, which provide fixed income in retirement in exchange for a lump-sum investment, can be one way to supplement a retiree’s income, LaVigne said.

    Consult with a financial advisor

    Before purchasing an annuity or other retirement income strategy, it helps to consult with a professional.
    “Having a really good financial advisor is the first step,” Featherngill said.
    Many financial advisors are licensed to sell annuities. Ideally, they will not be dedicated to one company’s products and can shop around to find the best deal for you, she said.

    Importantly, they can also look at your overall financial situation to evaluate whether an annuity is the right decision for you, or whether other strategies may better help you in retirement.
    “The most important thing when you’re choosing a financial advisor is to choose someone who you’re comfortable with,” LaVigne said.
    To accomplish that, it helps to talk to several professionals before selecting one.
    “You have to interview them for the job,” LaVigne said, and find someone whose style works for you.
    Retirees who have lower incomes may be able to find more information from their local senior centers and other community resources, Johnson suggested.

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    This overlooked corner of women’s health could be a $350 billion market opportunity

    Peathegee Inc | Tetra Images | Getty Images

    After years of being ignored, menopause has entered the public conversation.
    Celebrities from Drew Barrymore to Naomi Watts have opened up about symptoms and promoted products. Yet despite the increased chatter, there is a long way to go when it comes to treating symptoms — and a lot of opportunities for companies to step in to fill the gap.

    In fact, menopause is among the female health conditions with the highest unmet need and has “enormous potential for innovative treatments,” according to a recent McKinsey report.
    The management consultant estimates the global market potential to treat symptoms ranges from $120 billion to as much as $350 billion globally.
    Menopause occurs when women have gone 12 consecutive months without a menstrual period. While that happens, on average, at around age 51, women can have symptoms for years beforehand in what’s known as perimenopause. Symptoms can also continue in the postmenopausal phase.
    Those symptoms include hot flashes, anxiety, weight gain, vaginal dryness, mood changes, sleep problems and changes in skin conditions. More than 450 million women worldwide are affected by menopause and perimenopause symptoms, according to McKinsey.
    There is also a big unmet demand for menopause products and services, said Anna Pione, a partner at McKinsey who leads the firm’s research on the future of wellness.

    Menopause is “underserved, underfunded, underpaid attention to,” she said. “That would apply to women’s health in general, and then specifically and acutely to menopause in particular.”

    ‘Exciting’ developments

    Hormone therapy was the typical menopause treatment for decades. However, it got a bad rap in 2002 after a Women’s Health Initiative study found estrogen plus progestin therapy increased a woman’s risk of breast cancer and heart disease.
    “A lot of women bailed off hormone therapy for their own fear, or because their doctors were afraid, or some combination thereof,” said Dr. Stephanie Faubion, director of the Mayo Clinic Center for Women’s Health and medical director of the nonprofit Menopause Society.
    From 2002 to 2009, hormone therapy claims were reduced by more than 70%, a 2012 study showed.
    “It left a lot of women without any management at all,” Faubion said.
    However, research now shows that the benefits may outweigh the risks for women under age 60, or less than 10 years out of their menopause diagnosis.
    “Our knowledge has changed,” said Dr. Karen Adams, a Stanford University professor and director of the school’s menopause and healthy aging program. “It is really very exciting, but women are left shaking the trees trying to find someone who can help them.”

    Investing in the theme

    There are not many publicly-listed companies in the space. The largest U.S. name is Pfizer, which has a number of products in its portfolio. They include Duavee and Premarin, hormone therapy treatments for hot flashes and the prevention of osteoporosis.

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    Pfizer year to date

    Then, there is tiny Biote, which has a market cap just north of $400 million. The company, which went public in May 2022 through a SPAC deal, makes customized bioidentical hormone pellets to address hormone imbalances.
    Hormone treatment in general is an area of focus that is “really bubbling up to the surface,” said Jefferies analyst Kaumil Gajrawala, who has a buy rating on Biote.
    Menopause is the largest part of its market, he said. Biote uses blood tests to customize its hormone pellets, which are inserted into the body subcutaneously.
    “It gives you that consistent amount of delivery, and … there’s no concern about compliance and if you’ll remember a day or forget a day,” he said. “What it means in the end is that you feel better.”

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    Biote year to date

    Meanwhile, Dare Bioscience, which has an even smaller market cap of about $47 million, has a hormone therapy in the pipeline. The clinical-stage biopharmaceutical company, which focuses on women’s health, has an intravaginal ring hormone therapy that is set to progress to a single Phase 3 study.
    There is also a race to find non-hormone treatments.
    Last May, the Food and Drug Administration approved Tokyo-based Astellas Pharma’s Veozah, also known as fezolinetant, to treat hot flashes.
    Bayer also has a drug in its pipeline called elinzanetant. The German company said in January that therapy reduced the frequency and severity of hot flashes and improved sleep in two late-stage trials. The results of a third phase 3 study is expected in coming months, Bayer said. It will then submit for approval.
    In addition, late-clinical-stage biopharmaceutical company Vistagen Therapeutics, with a market cap of about $100 million, has a trial underway for a hormone-free nasal spray to treat hot flashes.
    In the non-drug category, fertility benefits manager Progyny recently announced it was expanding into menopause coverage by partnering with private companies Gennev and Midi Health.
    “The fact that they are focusing on menopause as one of the next legs of the stool is an indicator of the potential opportunity there,” said Sasha Kelemen, the head of women’s health investment banking at Leerink Partners.

    Private innovation

    Still, much of the innovation in menopause is happening in the private space.
    “Menopause is inevitable, like death and taxes, and all women will go through this,” Kelemen said. “We just don’t have a lot of public women’s health companies yet, and hopefully that will change.”
    In 2022, Kelemen orchestrated a deal for Unified Women’s Healthcare to buy Gennev, the Progyny partner that’s a digital menopause care delivery platform. Kelemen would not disclose the financial terms.
    Midi Health, the other Progyny partner that’s a virtual care clinic specializing in perimenopause and menopause, is another company attracting investor dollars. In September, Alphabet’s venture capital arm, Google Ventures, led a $25 million Series A funding round for the company, bringing its total funding to $40 million.
    Still, women’s health has long been underfunded, and menopause is getting just a small slice of that pie.
    “The dollars don’t match the conversation that’s happening,” Kelemen said. “While it’s growing, it’s still growing too slowly and definitely not in any way proportionate to the potential impact and the need of the actual population” that needs to be served.
    That said, Kelemen is optimistic funding will continue to increase. She’s also bullish on consolidation in the space and the potential for new innovations.
    “Because it is a hormonal change for a 10-, 15-, 20-year period, the needs of women will change,” she said. “There’s opportunity for multiple platforms to succeed.” More