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Americans paid $163.89 billion in credit card fees and interest in 2022, according to a WalletHub analysis.
Between 2018 and 2020, such charges were roughly $120 billion per year, according to the Consumer Financial Protection Bureau. 
“As bad as things have been for cardholders for the last year or so, it’s probably going to get a little worse for a while before it gets better,” said Matt Schulz, chief credit analyst at LendingTree.

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Advocates target late payment penalties as ‘junk fees’

The Biden administration has focused on cracking down on “junk fees” with the Federal Trade Commission and the CFPB in all areas of consumers’ lives, including certain credit card penalties.

Some credit card companies charge as much as $41 for a missed payment. The goal is to reduce late payment fees to $8, ban late-fee amounts that go over 25% of the cardholder’s required payment and end the automatic annual inflation adjustment, the CFPB said in a statement.

These charges are significant for lower-income households that may pay these fees constantly, amounting to almost a few hundred dollars over the course of a year, said Schulz.
Proposed changes are meant to fill gaps in the Credit Card Accountability Responsibility and Disclosure Act of 2009, or CARD Act. The law imposed guardrails on credit card companies such as price controls on penalty fees and specific conditions in which they can be charged. However, there is no restriction on how much APR a company can charge nor language on late fees.

How to minimize credit card fees, interest

Cardholders paid on average $76.27 in fees and interest per credit card account in the fourth quarter of 2022, WalletHub found. Considering this, it’s worth looking at ways to lower these additional charges.
“Life is so expensive in 2023 and it’s not going to get any cheaper any time soon,” he said.

1. Ask your card issuer for a break

Cardholders “can ask their card issuers for help,” Schulz said. Those who do “are more successful than most people realize,” he said.
For instance, more than 3 in every 4 cardholders who asked for a lower interest rate on one of their credit cards in the past year got one, according to LendingTree. Almost 90% of people who called their issuer about a late fee were able to get it waived, a 2022 WalletHub survey found.
If you ask your card issuer to lower your interest rate, they may run a credit check to see if anything has changed with your financial situation since you opened the card. However, the savings you may get with the lower rate may be worth taking the “little hit on your credit score,” said Schulz.

2. Use autopay, but remember it ‘isn’t perfect’

Consider setting up automated payments for your credit card statements so that you don’t miss a payment or accidentally pay late.
However, don’t lose sight of your monthly statements because “autopay isn’t perfect,” said Schulz.

Autopay makes a lot of things easier but it doesn’t absolve people of the responsibility for still keeping an eye on things.

Matt Schulz
chief credit analyst at LendingTree

You could still end up paying late if you don’t monitor the due date, and you may not be paying enough to cover the minimum if your balance is higher than expected. To avoid paying more in interest and fees, try to make sure you cover the entire statement balance.
“Autopay makes a lot of things easier,but it doesn’t absolve people of the responsibility for still keeping an eye on things,” added Schulz.
You can also ask to change your due date to make it more convenient, said Sara Rathner, credit cards expert and writer at NerdWallet. You’re aware of how much money you have available in your checking account this way before an automated payment goes through.

3. Avoid surprises

Take advantage of opportunities to mitigate surprise charges and get the information you need about your card, said Winnie Sun, co-founder and managing director of Sun Group Wealth Partners in Irvine, California.
Make sure you’re aware of your charges, whether that means routinely checking your statements or setting up push notifications every time your credit card is charged, said Sun, a CNBC Financial Advisor Council member. That can help you spot fraud and be aware of fees and interest you’ve accrued.
Finally, if you haven’t reviewed the terms and conditions with your credit card company in a long time, contact your issuer’s customer support and ask for a list of fees and how much each costs.
“You can always contact your card issuer and ask basic information about the card you have,” said Schulz.Don’t miss these CNBC PRO stories: More

A 3.2% cost-of-living adjustment will go into effect in January for millions of Social Security beneficiaries.
Here’s how to gauge how much extra you may see in your monthly checks.

Wand_prapan | Istock | Getty Images

How to calculate your Social Security COLA for 2024

There are two ways you can calculate how much your 2024 monthly Social Security check may be, according to Joe Elsasser, a certified financial planner and founder and president of Covisum, a provider of Social Security claiming software.
The best way is to take the amount of your current Social Security check and add back your monthly Medicare Part B premium, if it is deducted from your check. In 2023, the standard monthly Part B premium is $164.90. However, higher-income beneficiaries pay more, including single individuals with more than $97,000 in income and married couples with more than $194,000.
Then, apply the COLA to the entire benefit, including what you are having withheld for taxes. Next, subtract the new Medicare Part B premium for 2024, as well as taxes at the rate you have withheld. Next year, the standard monthly Part B premium will be $174.70. Higher-income individuals with more than $103,000 in income and married couples with more than $206,000 will pay more.
That should give you the size of your benefit for next year, according to Elsasser.
Alternatively, you can do a rough calculation by taking the monthly benefit you’re getting today and multiplying by 1.032.
“It would be a rough calculation, but it’s a reasonable guess,” Elsasser said.

How your 2024 benefit compares to others

The maximum benefit for a retired worker who claims at full retirement age will go up to $3,822 per month in 2024, up from $3,627 per month in 2023.
The average benefit for all retired workers will be $1,907 in 2024, up from $1,848 in 2023, according to the Social Security Administration.

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Struggling borrowers may not have to resume their student loan payments for another year.
Here’s what to know about the Biden administration’s relief measure.

A woman planning a budget.
Rockaa | E+ | Getty Images

Do I have to do anything to apply for the relief?

Borrowers do not need to enroll in the on-ramp period, the U.S. Department of Education says.
If your loans were eligible for the pandemic-era payment pause, which mainly include those in the Direct program, then they’ll also qualify for this grace period of sorts.
Loans that don’t qualify include private student loans and commercially held Federal Family Education Loans.

Will interest continue to accrue on my debt?

Yes. Interest began accruing on federal student loans Sept. 1.
Unlike during the pandemic-era pause on federal student loans, when interest rates were set to zero, your debt will continue to grow at its pre-Covid rate over the next year. Forgoing payments or making only partial payments during the on-ramp period means you’ll likely have a larger bill in a year.
For that reason, Scott Buchanan, executive director of the Student Loan Servicing Alliance, a trade group for federal student loan servicers, said he hoped borrowers weren’t thinking this is just another payment pause.
“There is a fundamental difference here, which is that interest is accruing now,” Buchanan said.

Are there any consequences to not making payments?

Besides the accrual of interest, experts say there are unlikely to be consequences of not making payments during the on-ramp period. However, like with all things student loans, it’s good be careful. One borrower already told CNBC her account was put into a past-due status when she didn’t make her October payment.
Still, the Department of Education says it will not report your missed payments during this period to the credit bureaus.
Borrowers should also be shielded from collection activity, including the garnishments of their wages or retirement benefits, said higher education expert Mark Kantrowitz.

Should I make payments or not?

If you can afford to make your student loan payments, most experts recommend that you do so to avoid ending up with a larger bill when the on-ramp period ends.
Still, experts say some borrowers with small debt balances who believe they will qualify for President Joe Biden’s Plan B for student loan forgiveness are taking their chances and holding off on making their payments.
“They’re trying to buy themselves time,” said Braxton Brewington, press secretary for the Debt Collective.
Biden’s plan is currently working its way through the regulatory process. It is unclear if the administration’s second attempt at providing people relief will end any differently than its first, with a failure at the Supreme Court.

What if my servicer gets it wrong?

The restart of student loan payments is proving rocky for many. Borrowers describe incredibly long wait times trying to contact their servicers and receiving incorrect bills.
One customer service representative at a servicer told a borrower they hadn’t even heard of the on-ramp period, Brewington said.
If you feel you’re facing a consequence for a missed payment that you shouldn’t be, Kantrowitz recommends reaching out to the Federal Student Aid Ombudsman.
Borrowers can also see if they qualify for existing forbearance options.Don’t miss these CNBC PRO stories: More

Nearly 40 million Americans stood to benefit from President Joe Biden’s original student loan forgiveness plan, which the Supreme Court blocked over the summer.
The Biden administration is now trying to cancel education debt another way.
The plan seems to be prioritizing those who have been in repayment for decades and are struggling financially.

President Joe Biden is joined by Education Secretary Miguel Cardona as he announces new actions to protect borrowers after the Supreme Court struck down his student loan forgiveness plan, in the Roosevelt Room at the White House in Washington, D.C., on June 30, 2023.
Chip Somodevilla | Getty

Nearly 40 million Americans stood to benefit from President Joe Biden’s original student loan forgiveness plan, which the Supreme Court ultimately blocked over the summer.
Though the Biden administration is now trying to cancel education debt another way, experts have warned that borrowers should temper their expectations. Given the legal challenges of passing sweeping debt forgiveness, they say the president’s Plan B for relief is likely to be narrower in its reach.

“A much smaller number of borrowers will be eligible,” said higher education expert Mark Kantrowitz.
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Indeed, Kantrowitz estimates that less than 10% of federal student loan borrowers will qualify this round. Under the president’s first plan, rolled out in August 2022, more than 90% of borrowers would have seen their balances cleared or reduced. The plan only excluded those who earned above $125,000 as individuals or married couples making more than $250,000.
The U.S. Department of Education did not immediately respond to CNBC’s request for comment.
Consumer advocates have criticized the Biden administration for scaling back its plans and are pressuring him to take on his legal opponents and still try to go big with debt cancellation. On the campaign trail, Biden promised to cancel at least $10,000 of student debt per person.

“Anything less than what Biden promised will be felt as a letdown, even a betrayal,” said Astra Taylor, co-founder of the Debt Collective, a union for debtors, in a previous interview with CNBC.

For now, the administration seems focused on delivering relief to five specific groups of borrowers, according to a recent paper issued by the U.S. Department of Education.

1. Borrowers with balances greater than what they originally borrowed

The Education Department says it will focus on borrowers who have seen their balances only grow due to the accrual of unpaid interest.
CNBC has written about people who have seen their debt double or even triple because they have needed to put their debts into forbearance or have been billed amounts that don’t even fully cover their interest.

2. Those who have been paying for decades

The Education Department is looking at providing relief to borrowers who “entered repayment many years ago.”
While it is unclear how many people fit into this category, about 2.7 million borrowers age 62 and older currently owe around $115 billion in student debt, Kantrowitz said.

3. People who attended programs of questionable value

Borrowers who attended programs that did not “provide a minimum level of financial value” will be another group considered for relief.
Under Biden, the Education Department has already made students of for-profit colleges, which have come under scrutiny for misleading borrowers about their programs, a priority. It has forgiven about $22 billion in student debt for such people.

4. Borrowers eligible for relief but who haven’t applied

5. Debtors in financial hardship

Lastly, as the Education Department revises its forgiveness plan in a way that it hopes will be met with less of a legal backlash, it’ll look to address borrowers who are experiencing financial hardships that the current loan system might not account for.
Even before the Covid-19 pandemic, when the U.S. economy was enjoying one of its healthiest periods in history, problems plagued the federal student loan system.
Only about half of borrowers were in repayment in 2019, according to an estimate by Kantrowitz. About 25% of borrowers — or more than 10 million people — were in delinquency or default, and the rest had applied for temporary relief for struggling borrowers, including deferments or forbearances.
These grim figures led to comparisons to the 2008 mortgage crisis.Don’t miss these CNBC PRO stories: More

The IRS on Tuesday unveiled more details about Direct File, the agency’s free electronic tax filing pilot program.
Starting in 2024, Arizona, California, Massachusetts and New York will integrate state tax filings into the pilot program.
Taxpayers from Alaska, Florida, New Hampshire, Nevada, South Dakota, Tennessee, Texas, Washington and Wyoming may also be eligible.
The pilot program will initially focus on “relatively simple returns” and not all filers from these states will qualify.

IRS Commissioner Danny Werfel speaks at a Senate Finance Committee hearing in Washington, D.C., on April 19, 2023.
Al Drago | Bloomberg | Getty Images

The IRS on Tuesday unveiled more details about its direct filing pilot program launching for the 2024 tax season.
Known as Direct File, the pilot will allow certain taxpayers to electronically file federal tax returns for free directly through the IRS, the agency told reporters on a press call.

Starting in 2024, Arizona, California, Massachusetts and New York will integrate state tax filings into the pilot program. Taxpayers from Alaska, Florida, New Hampshire, Nevada, South Dakota, Tennessee, Texas, Washington and Wyoming may also be eligible.
An IRS official estimates “at least several hundred thousand taxpayers across the country” will have the option to participate in the 2024 pilot program.
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“In this limited pilot for 2024, we will be working closely with the states that have agreed to participate in an important test run of the state integration,” IRS Commissioner Danny Werfel said. “This will help us gather important information about the future direction of the Direct File program.”
After filing federal returns through Direct File, the software will direct taxpayers to state-sponsored tools to complete separate state filings. For 2024, this integration will only include participating states.

Who is eligible for IRS Direct File in 2024

“To ensure a good experience for taxpayers, the pilot will launch in phases,” Laurel Blatchford, chief implementation officer for the Inflation Reduction Act at the U.S. Department of the Treasury said.
For 2024, the pilot will focus on individual filers with “relatively simple returns,” but not all taxpayers will qualify. The IRS expects the program to include Form W-2 earnings, Social Security income, unemployment income and interest of $1,500 or less. More

Increasingly, it’s the choice of college major and type of degree that most affects your earnings potential.
Here are the areas of study that pay the most, according to a new analysis by the U.S. Census Bureau.

Between the sky-high overall cost and hefty student loan tab, more students and their families are reconsidering the value of a college education.
But ultimately, it’s the choice of major and type of degree that most affects your return on investment.

Students who pursue a degree specifically in computer science, electrical engineering, mechanical engineering or economics — mostly STEM disciplines — earn the most overall, according to a new analysis of bachelor’s degrees and median earnings by the U.S. Census Bureau.

Workers in those fields have an annual income of $100,000 or more, the report found. 
Alternatively, those with degrees in education, elementary education, fine arts, family and consumer sciences and social work had annual earnings of less than $60,000.

Gender wage gaps persist in top-earning fields

Yet, wage gaps persist across the board.
In all cases, men earn more than women, the Census Bureau found. For example, women with computer science degrees earned $91,990, while men earned $115,500. Among economics degree holders, women earned $84,750 while men earned $107,300. 

“This career inequity begins immediately when women enter the workforce and continues at every juncture,” said Stefanie O’Connell Rodriguez, host of the “Money Confidential” podcast.

Consider the return on your academic investment

Ultimately, getting a college degree typically pays, studies show.
Bachelor’s degree holders generally earn 75% more than those with just a high school diploma, according to The College Payoff, a report from the Georgetown University Center on Education and the Workforce.
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However, it’s important to consider your area of study before taking out student loans to pay for college, said Robert Franek, editor in chief of The Princeton Review.
“Just as a rule of thumb, students shouldn’t take on more debt than they expect to earn their first year after graduation,” he said.
At the very least, that “forces the conversation of what is going to be the real return on my academic investment.”Don’t miss these CNBC PRO stories:

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The third-quarter average monthly payment on a new vehicle was a record $736, up from $733 in the second quarter, according to Edmunds.
The annual percentage rate on car loans also jumped in the third quarter, according to Edmunds.
“What really is driving these prices is less inventory than before,” said Jessica Caldwell, Edmunds’ head of insights.

Adam Gault | OJO Images | Getty Images

Prices keep creeping higher for shoppers in the market for a new or used vehicle.
Car prices and interest rates are higher, pushing up costs for drivers. Yet, pent-up demand has kept cars moving off lots, experts say, meaning dealers don’t have much reason to offer discounts.

“What really is driving these prices is less inventory than before,” said Jessica Caldwell, Edmunds’ head of insights. “Consumers are not getting necessarily the massive discounts they once were.”
The annual percentage rate on car loans jumped in the third quarter, according to Edmunds. The APR on loans for new vehicles rose to 7.4% and for used vehicles, to 11.2%, both levels last seen during the Great Recession.
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Rising rates contributed to higher costs. The third-quarter average monthly payment on a new vehicle was a record $736, up from $733 in the second quarter, according to Edmunds. For used cars, the average monthly payment slightly lowered to $567 from $569.
The auto market is still experiencing pent-up demand from drivers who had delayed buying new vehicles in 2020 but are now shopping around despite high costs.

“We’re getting to a point where people just can’t delay [purchases] any longer. They’re getting back into the market,” said Caldwell.

Fewer discounts, cars available

It’s still too soon to tell whether the ongoing United Auto Workers strike is affecting car prices, said Caldwell. Moreover, the strike might only affect a relatively small number of vehicles when compared to the auto market as a whole.
Car shoppers are instead seeing the effects of a low-inventory, high-demand market, leaving little to no room for discounts, experts say.
Historically, new model year vehicles would come into a dealer’s lot by the end of the summer to replace older inventory. At that point, dealers had motivation to offer discounts on leftover older models.

However, this year, “there are no leftovers,” said Tom McParland, regarding vehicles that serve the average consumer. McParland is a contributing writer for automotive website Jalopnik and operator of vehicle-buying service Automatch Consulting.
“There’s really no such thing as a leftover 2023 Sienna Hybrid because these cars are selling six to nine months before they even arrive at the dealership,” he added.
Car shoppers hardly saw similar end-of-summer sales last year either because of a chip shortage that reduced production levels, added Caldwell. The shortage of semiconductors during the Covid-19 pandemic led to a significant drop in produced vehicles, costing the auto industry billions in revenue.
For cars targeted to the average consumer, such as sedans, crossovers and hybrids, deals are hard to come by because of high demand and slow production, said McParland. On the other hand, there are leftover deals for luxury electric vehicles because those cars have been sitting around, he added. 

It’s ‘a great time to look into the EV market’

However, there are some exceptions. Shoppers may see more inventory for different vehicles. EV availability was well above the industry average at the start of October as product availability and EV production rapidly increased, according to auto industry service provider Kelley Blue Book.
This leaves room for deals in a high-inventory market, said McParland.
“It is absolutely a great time to look into the EV market, both for new and pre-owned,” he said.
Additionally, recurring price cuts from Tesla this year might also soften prices in the EV market as a whole, added Caldwell.
The average price paid for an EV was $50,683 in September, down from $52,212 in August and down from more than $65,000 one year ago, according to Kelley Blue Book.
Pre-owned electric vehicles are more likely to go for a price under $25,000, which would qualify the car shopper for an additional federal tax credit of $4,000.
However, drivers shopping for a pre-owned vehicle should keep in mind that while EVs don’t have as many parts as gas-powered cars, it remains difficult to predict how long their rechargeable batteries will last.
EVs from five years ago or 2018 “weren’t as good,” said Caldwell, especially when looking at ranges and charging efficiency.

Shopping tips for a low-inventory car market

Overall, prices for cars at large are unlikely to drop significantly in the future. The technology that is being built into vehicles will further drive prices up “as we go towards electrification and autonomous technology,” added Caldwell.
“Those technologies are pricey.”
If you are currently in the market for a new or used car, do your research before heading to the dealership to make the best decision. Here are three tips:

Get preapproval for an auto loan. Dealerships don’t always offer the most competitive financing. Shop for financing at your personal bank and other local financial institutions and credit unions online to see what type of loans and interest rates you can get, said Caldwell.
Shop for both new and used car. Expand your research to increase the probability of finding good deals that work for your budget. If you weren’t a used car shopper before, looking into certified pre-owned vehicles can help bring you peace of mind, said Caldwell.
Research trade-in values. If you’re trading in a vehicle, get quotes from different sources and dealers and try various appraisal features. “Definitely shop around and make sure you’re not leaving that money on the table,” she said.

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Young individuals are “buckling down” when it comes to spending, a Bank of America executive said, following a new Gen Z-focused survey by the firm.
While that is a savvy move, Gen Zers would also be wise to take several steps to prepare for their futures, experts say.

Martin-dm | E+ | Getty Images

Gen Zers are cutting back on spending.
More than half, 53%, say a high cost of living is a barrier to their financial success, according to a new survey from Bank America.

Nearly 3 in 4 young adults surveyed, 73%, have changed their spending habits amid record-high inflation.
“Many of them are buckling down,” said AJ Barkley, head of neighborhood and community lending at Bank of America, calling the results “good news.”
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Among the changes they are making include cooking at home more frequently, with 43%; spending less on clothes, 40%; and limiting grocery shopping to essentials, 33%.
Most plan to keep up those changes in the next year, according to the firm’s August survey of almost 1,200 young adults ages 18 to 26.

Gen Z faces unique financial challenges

Yet, more than a third of young Gen Zers have also faced setbacks in the past year, the survey found, which may have led them to stop saving or take on more debt.
Gen Z faces unique financial challenges compared to older generations. College graduates earn 10% less compared to their parents, recent research found.

High inflation — and affordability concerns among Gen Zers — extend beyond U.S. borders. A Deloitte survey released earlier this year that included about 14,500 members of Gen Z in 44 countries found living paycheck to paycheck was a concern cited by about half of that generation, with 51%; followed by needing to take on a side job, 46%; and cost of living, 35%.

‘This is really the time to build a solid foundation’

But there is good news, according to Bank of America’s research. Most respondents feel confident they can manage their day-to-day expenses, budget and credit. Yet, they show less confidence when it comes to saving for retirement or investing in the stock market, the results found.
“This is really the time to build a solid foundation that is going to allow you to be successful throughout the many next decades of your financial life,” said Douglas Boneparth, a certified financial planner and president of Bone Fide Wealth in New York. Boneparth is also a member of the CNBC Financial Advisor Council.
Experts say these three tips can help members of Gen Z learn to manage their money wisely.

1. Make saving a habit

Ute Grabowsky | Photothek | Getty Images

More than half of Gen Z, 56%, do not have enough emergency savings to cover three months’ worth of expenses, Bank of America’s survey found.
It’s a good idea to sock away any extra cash you can, said Boneparth, and to think about what’s important to you to stay motivated.
“Get in the habit of being a consistent saver,” Boneparth said.
Having that cash cushion set aside can help you continue to pursue your goals, even as life throws surprises your way. “It’s never a straight line,” Boneparth said.

2. Start investing for retirement now

While retirement may seem like a far-off goal, especially in the early years of your career, it’s actually when you have your biggest advantage to accumulate wealth, according to Barkley.
Any money you invest now will have more time to accumulate gains that compound over time.
“They should be thinking about retirement now,” Barkley said.

To get started, an employer-provided 401(k) may help with those initial contributions and may even include an extra boost from a company match, if offered.
Young investors may also open an individual retirement account on their own. Experts often recommend making post-tax contributions to a Roth IRA early on, as you may be prohibited from contributing to those accounts later in your career when your income is higher.

3. Resist the urge to give into FOMO

Gen Z women are more apt to feel pressured to spend to keep up with their social circles, Bank of America found.
Social media is a big driver of those feelings, with 41% of women Gen Zers saying their feeds make them wish they had more money for nonessential spending, versus just 24% of men.
All Gen Zers would be wise to avoid that FOMO, according to Ted Jenkin, a CFP and CEO of oXYGen Financial in Atlanta. Jenkin is also a member of the CNBC FA Council.
“Your friends are not posting their net worth on Instagram and TikTok, so be wary that people may not be doing as well as they appear on social media,” Jenkin said.
It also doesn’t hurt to avoid credit card debt and to check your credit score regularly, Jenkin said. More