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A shopper passes in front of a North Face store at the Easton Town Center mall in Columbus, Ohio, on Jan. 7, 2021.
Luke Sharrett | Bloomberg | Getty Images

Company: VF Corporation (VFC)

Business: VF Corp. is a consolidator of consumer footwear and apparel brands. It engages in the design, procurement, marketing and distribution of branded lifestyle apparel, footwear and related products, and it operates through three segments: outdoor, active and work. The company’s brands include The North Face, Timberland, Smartwool, Icebreaker, Altra, Vans, Supreme, Kipling, Napapijri, Eastpak, JanSport, Dickies and Timberland Pro brand names.
Stock Market Value: $6.03B ($15.50 per share)

Activist: Engaged Capital

Percentage Ownership:  n/a
Average Cost: n/a
Activist Commentary: Engaged Capital was founded by Glenn W. Welling, a former principal and managing director at Relational Investors. Engaged is an experienced and successful small-cap investor and makes investments with a two- to five-year investment horizon. Its style is holding management and boards accountable behind closed doors. Engaged has had great success as an activist, but almost all that success has come at small-cap companies. The firm has generated consistent returns in its small-cap activism. However, of the 31 activist campaigns in their history, this is only the sixth one above a $2 billion market cap. In the previous five, the firm received board representation each time, but has struggled to see financial success.

What’s happening

On Oct. 17, Engaged announced that it took a stake in VF Corp. and called on the company to undertake a plan that includes reducing costs, restoring brand autonomy, enhancing the capital structure and refreshing the board. Shortly thereafter, on Oct. 24, Bloomberg reported that Legion Partners Asset Management has also taken a stake in VF Corp. and is calling for the company to divest some of its brands.

Behind the scenes

While VF Corp. is a consolidator of consumer footwear and apparel brands, it essentially is comprised of three brands that make up 79% of their revenue – Vans, The North Face and Timberland. Historically, the company was operationally focused and had relatively consistent operating margins. On Jan. 1, 2017, Steve Rendle became CEO and shortly thereafter, he commenced a significant reorganization of the business which included centralizing several key functions previously managed at the brand level and relying on acquisitions for growth. Most notably, in November 2020, he purchased Supreme for over $2 billion expecting (and receiving) $500 million of revenue in 2022 from the streetwear brand. This strategy expanded the corporate cost structure, reduced autonomy of brands and ultimately deprived core brands of capital to offset investments in a corporate center that he had built. Under his tenure, earnings before interest, taxes, depreciation and amortization (EBITDA) margins dropped over 300 basis points, total corporate expense increased 34% from $631 million to $844 million and the stock price has declined 31.27% versus an increase of 77.11% for the S&P 500. By the time Engaged got involved, the company was trading at 10-year lows, down more than 80% from where shares traded prior to the Covid pandemic. VF Corp. was in desperate need of a new CEO, and they got one. Rendle left the company in December 2022. On July 17, 2023, Bracken Darrell, the former CEO of Logitech, became the new CEO at VF Corp.

Darrell spent the prior decade creating value as CEO of Logitech. During his time there, Darrell spearheaded a turnaround that included a major cost restructuring, reinvestment in design and innovation to help the company return to growth, as well as a significant improvement in profitability that led to a share price appreciation of over 900% during his decade-long tenure. So, it sounds like the board has found the right person for the job. Engaged thinks that this turnaround should start with unwinding duplicative costs, pointing out that there are over $300 million in cost savings that are actionable in the short term. However, just taking the company from 12% to 15% EBITDA margins will not reverse the sharp decline in the stock price. After this, Engaged suggests a restoration of brand autonomy, with a portion of the cost savings being reinvested to support growth and a product-driven turnaround at Vans. This is much easier said than done. The Vans brand has been in decline, dropping to $3.6 billion of revenue in 2023 from $4 billion in 2020. Engaged also urges VF Corp. to evaluate non-core divestitures to fix the balance sheet.
At the very least, Engaged would like to see a commitment to no further acquisitions and a reduction of the dividend. The firm would like management to use the additional cash from these activities to pay down debt and support the turnaround at Vans and continued investment in The North Face to maintain its competitive edge. That is a lot to do with an uncertain amount of cash flow, but nearly three-fourths of the VF Corp.’s revenues are generated through wholesale and owned ecommerce channels, so it is easier to grow sales with less incremental capital. Engaged thinks that The North Face, plus the value of a stabilized Vans, could be worth over $30 per share, without applying any value to the remaining portfolio which includes Timberland, Supreme, Dickies and other small brands. After adding up all the pieces, Engaged sees a path to a $46 share price within three years.
As this is a moving target with important decisions to be made every day, I would expect Engaged would want a board seat to help oversee this turnaround and hold management accountable if the firm is unsuccessful. Moreover, a majority of the current board members served through former CEO Rendle’s whole tenure and allowed the strategic mistakes to go on unchecked. So, fresh blood on the board would certainly be warranted. Engaged is likely working with management behind the scenes to discuss board representation. If no agreement is reached, the director nomination window opens on Jan. 14, 2024, at which time I would expect them to nominate directors.
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

Customers at several big banks on Friday wrestled with direct deposit delays stemming from an industry-wide processing issue.
The Federal Reserve reported a problem with the Electronic Payments Network, a private sector operator for Automated Clearing House, or ACH, a network that processes transactions.

A man walks by the Bank of America headquarters in New York on July 18, 2023.
Eduardo Munoz | View Press | Getty Images

Customers at several big banks on Friday wrestled with direct deposit delays stemming from an industry-wide processing issue.
There was a surge of “outages” reported by banking customers Friday morning, including Bank of America, Chase, Truist, U.S. Bank and Wells Fargo, according to Downdetector. But the site does not specify the nature of the complaints.

All Federal Reserve Financial Services are operating normally, according to a Federal Reserve statement released Friday.
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The Fed reported a processing issue with the Electronic Payments Network, a private sector operator for Automated Clearing House, or ACH, a network that processes transactions.
“There was a processing error with an ACH file last night; it was a manual error associated with the file,” said Gregory MacSweeney, vice president and head of communications at The Clearing House, the banking association and payments company that owns the EPN processing system.
Banks are now working to correct the errors in those payments, he said.

“We’re aware of an industry-wide technical issue impacting some deposits for Nov. 3,” Lee Henderson, vice president of public affairs and communications at U.S. Bank, told CNBC in a statement. “Customer accounts remain secure, and balances will be updated when deposits are received.”

“We do not have an estimate on timing at this point,” Henderson added. “Customers do not need to take any action.”
“The originators of these deposits are working to resend the payment files, and we will post them as soon as we can,” said a Chase spokesperson in a written statement. Bank of America, Truist and Wells Fargo did not provide commentary by publication time.
Customers affected by the deposit delays can call their lenders and explain their late payments were due to an industry-wide issue, said Matt Schulz, chief credit analyst at LendingTree.
“When money that we expect to be there on a Friday morning isn’t there and your autopay is set up to pay a credit card or a buy now pay later loan, it can cause some real issues,” he said.Don’t miss these stories from CNBC PRO: More

U.S. job growth fell to 150,000 last month and unemployment rose to 3.9%, according to the U.S. Bureau of Labor Statistics’ October jobs report.
Workers have lost some bargaining power and leverage from the historic levels seen in 2021 and 2022.
Despite a broad cooldown, the labor market has been resilient in the face of headwinds and there doesn’t seem cause for panic yet, economists said.

Jobseekers wait in line at a Nov. 2, 2023 career fair in Los Angeles.
Frederic J. Brown | Afp | Getty Images

The unemployment rate rose to 3.9% in October, from 3.8% in September, the BLS said. Average hours worked declined slightly to 34.3 a week, the “very bottom end of the range” typical for good economic times, Pollak said.
“There’s almost no exception in this report: Every indicator suggests a slowing, slackening labor market,” she said.

Yet, there’s cause for optimism. The job market has proven resilient in the face of economic headwinds and remains healthy in historical terms, economists said.
“The days of explosive growth are gone, as the labor market shifts into healthier and more sustainable territory,” said Noah Yosif, lead labor economist at UKG, a payroll and shift management company. “All indicators point to a continued lull in the immediate future. It’s a slowdown, not a collapse.”

Workers have lost some leverage

Why the data isn’t so gloomy

The overall jobs figure for October would have been higher — closer to 200,000 — absent strikes among autoworkers, actors and other union workers, economists said.
That would have been a “pretty spectacular number,” said Aaron Terrazas, chief economist at Glassdoor, a career site.
“On the surface it was a weak number, but this was clearly clouded by all of the strikes that were happening mid-month,” Terrazas said.

Indeed, there were nearly 50,000 workers on strike during the reference period the BLS uses to compile the jobs report, which was the largest number of workers on strike dating to 2004, Terrazas said.
Those strikes are now largely resolved.
The unemployment rate also remains below 4%, a key barometer.
“It tends to do great things in the labor market” when below 4%, Pollak said. “It tends to cause people to come off the sidelines, cause racial and gender wage gaps to narrow and force employers to improve working conditions and expand their talent pools.”

However, the unemployment rate was 3.5% just a few months ago, in July, and it’s rare to see that big an increase outside of recessions, Andrew Hunter, deputy chief U.S. economist at Capital Economics, said Friday in a research note.
That recent rise isn’t yet “panic-worthy,” but further increases “may begin to trip some recessionary alarm bells,” said Nick Bunker, head of economic research at job site Indeed.
The rise in the unemployment rate may also just be a sign that the extremely hot labor market is loosening a bit, Bunker added.

The labor market cratered in the early days of the Covid-19 pandemic amid mass job loss, a scale unseen since the Great Depression. However, it began heat up in 2021 and 2022 as the U.S. economy reopened and business’ demand for workers spiked to a historic level.
Now, the Federal Reserve has raised interest rates to cool the economy and tame inflation. That increase in borrowing costs for households and businesses is beginning to bite, Pollak said.
“While much in today’s payroll report appeared to confirm a continued slowing in the labor markets, it’s remarkable to witness how dynamic and resilient employment has been in the wake of the pandemic and inflationary shocks,” said Rick Rieder, head of the global allocation investment unit at asset manager BlackRock. More

Older workers in physically demanding jobs face unique retirement challenges.
Policy safeguards may help improve their financial security, report finds.

Turner worker working on drill bit in a workshop
Rainstar | E+ | Getty Images

The Social Security retirement age is currently moving to age 67, and some lawmakers have called for pushing it even higher.
But that may be a problem for a certain cohort: older workers in physically demanding jobs, according to a recent task force report from the National Academy of Social Insurance.

“It would be deeply irresponsible to further raise the retirement age before we’ve even gotten a handle on the damage that has been done to this group, and to other groups of workers, by the increase in the retirement age that’s already happening,” Rebecca Vallas, senior fellow at The Century Foundation and a task force member, said during a presentation this week on the report’s findings.
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Social Security reforms passed in 1983 included gradual increases to the full retirement age, the point at which retirees may receive 100% of the benefits they earned. Today, people born in 1960 or later have a full retirement age of 67, which has been gradually phased in from age 65.

Workers in physically demanding jobs often claim early

When it comes to claiming Social Security retirement benefits, the advice is generally to delay as long as possible to get bigger benefits.
But workers who have physically demanding jobs may be unable to wait.

“There’s a lot of jobs that older workers are performing that you really can’t be expected to do well past the the early age of 62,” said Joel Eskovitz, director of Social Security and savings at the AARP Public Policy Institute and a task force member who worked on the report.
When those workers claim benefits early, they may find those reduced monthly checks fall short of the income they need. Moreover, those workers often do not have substantial retirement savings to fall back on due to low wages and a lack of access to retirement plans or pensions through their employers.

More than 10 million older workers face physical demands in their work, estimates the National Academy of Social Insurance’s task force report. That includes those who work in warehouses, restaurants or as home health aides, for example.
“The task force universally agreed that this would only further harm this already economically vulnerable group of workers,” Vallas said of raising the retirement age.
Instead, the group suggested a host of policy changes that may help. That includes four Social Security benefit changes that may help this vulnerable population as they age, according to the task force.

1. Create a bridge benefit

A bridge Social Security benefit could help workers who cannot work until their full retirement age, but who are unable to claim Social Security disability benefits.
The bridge benefit would start from age 62, when claimants are first eligible for retirement benefits, and last until age 67, or full retirement age. Claimants would receive half the difference between what they would receive at full retirement age versus age 62.
For example, if someone is eligible for $1,000 per month in Social Security benefits at full retirement age, and a $700 reduced benefit at age 62, they may instead receive $850 at 62 with the bridge benefit, according to Eskovitz. The bridge benefit would be recalculated each year until full retirement age, when the worker would start receiving their full benefits.
To qualify, workers would need to have performed physically challenging work. Those who served in the most physically demanding positions would qualify at 62, while those qualifications would gradually become easier as ages increase.

2. Raise the minimum benefit

Tetra Images | Getty Images

Long-term low-wage workers who have not earned adequate retirement benefits may qualify for what is known as a special minimum benefit.
However, those benefits have risen slower than regular benefits because they are adjusted differently. Raising the minimum benefit would help, according to the task force.
Lawmakers have also been eyeing the change. One Congressional proposal, the Social Security 2100 Act, would bring lift an estimated 5 million people out of poverty by bringing up the minimum benefit, Rep. John Larson, D-Conn., said during a recent AARP event.

3. Create partial early retirement benefits

Some older workers may continue to work but reduce their hours as they age.
Allowing those workers to claim partial early retirement benefits may help make up for any lost income while also limiting the penalties for claiming before full retirement age. Research has found partial early retirement benefits, combined with the ability to turn the checks on and off, may improve retirement security for millions of Americans, according to the report.

4. Change the earnings test

People who claim Social Security retirement benefits before their full retirement age and who continue to work may be subject to an earnings test.
In 2024, that will apply to earnings above $22,320 per year, up from $21,240 per year in 2023. For every $2 above that limit, $1 in benefits will be withheld. (Higher limits apply for the year someone reaches their full retirement age.)

Importantly, the benefits that are withheld while a beneficiary is working are later added to monthly checks once they reach their full retirement age.
The earnings test may be a disincentive to work and is often misunderstood, according to the report.
By revising the earnings test, that may help bring the U.S. in line with other countries that have smaller annual retirement income reductions for working, according to the report.

Other policy reforms may help

The National Academy of Social Insurance report also highlighted other policy changes that may help workers in physically challenging jobs, including Social Security disability benefit reform, enhancements to services from the Social Security Administration, as well as improvements to other programs and administration.
Notably, that includes the idea of eliminating the reconsideration stage of the appeals process for Social Security disability benefits.
“This was something that actually got a lot of attention at a Ways and Means hearing last week, and actually a lot of bipartisan attention, which was pretty wonderful to hear,” Vallas said.
Other changes suggested in the report include providing employment and training programs for older workers, as well as strengthening unemployment insurance coverage available to them. More

This month, more than 200,000 high school seniors will receive proactive college acceptance offers as part of a new direct admissions program.
The goal is to expand college access, particularly to first-generation and low-income applicants at a time when fewer are choosing to pursue a four-year degree.

More schools offer guaranteed admission

In the wake of the Supreme Court’s affirmative action ruling, colleges are looking for new strategies to recruit students from diverse backgrounds, according to Jenny Rickard, CEO of the Common App.
“It’s about removing barriers,” she said. “It’s about equity and access.”
Each year, more than 1 million students — one-third third of whom are first-generation — use the common application to apply to school, research financial aid and scholarships, and connect to college counseling resources, according to the nonprofit organization.

Individual schools and school systems have also rolled out similar initiatives to broaden their reach. Last spring, the State University of New York sent automatic acceptance letters to 125,000 graduating high school students.

College enrollment is falling

Photo: Bryan Y.W. Shin | Wikicommons

Nationwide, enrollment has noticeably lagged since the start of the pandemic, when a significant number of students decided against a four-year degree in favor of joining the workforce or completing a certificate program without the hefty price tag of the more advanced degree.
This fall, undergraduate enrollment grew for the first time since 2020, according to the National Student Clearinghouse Research Center’s latest report.
But gains were not shared across the board. Community colleges notched the biggest increases year over year, the report found, accounting for almost 60% of the increase in undergraduates.
“Students are electing to pursue shorter-term programs,” said Doug Shapiro, executive director of the National Student Clearinghouse Research Center. “More 18- to 20-year-olds, especially at four-year institutions, are opting out.”

Tuition keeps rising

Not only are fewer students interested in pursuing a four-year degree after high school, but the population of college-age students is also shrinking, a trend referred to as the “enrollment cliff.”
In fact, undergraduate enrollment in the U.S. topped out at roughly 18 million students over a decade ago, according to the National Center for Education Statistics.
These days, only about 62% of high school seniors in the U.S. immediately go on to college, down from 68% in 2010. Low-income students who feel priced out of a postsecondary education are often those who opt out.

Arrows pointing outwards

Recent data from the Common App found that that more than half, or 55%, of students who use the Common App’s online application are from the highest-income families.
Steadily, college is becoming a path for only those with the means to pay for it, other reports also show.
And costs are still rising. Tuition and fees at four-year private colleges rose 4% to $41,540 in the 2023-24 school year from $39,940 in 2022-23. At four-year, in-state public colleges, the cost increased 2.5% to $11,260 from $10,990 the prior school year, according to the College Board.

Financial aid is key

“Just because a school offers acceptance doesn’t mean the finances will line up,” cautioned Robert Franek, The Princeton Review’s editor-in-chief and author of “The Best 389 Colleges.”
“It’s important to ask critical questions,” he said. Students should consider how much aid is being awarded, as well as the academic fit, campus culture and career services offerings.
Further, even if acceptance is not guaranteed, there are many schools that accept the majority of those who apply, Franek said.
In fact, of The Princeton Review’s list of 389 best colleges, 254 schools admit at least half of all applicants. More than one-quarter admit at least 80% of those who apply. (On the flip side, only 8% of schools on the list of best colleges admit less than 10% of applicants.)
“We always think of the most competitive schools but there is a school, and likely many schools, out there to consider,” Franek said. More

In a U.S. Department of Education memo, senior officials detail the errors made by its servicers as tens of millions of borrowers resumed their payments in October.
The companies sent more than 21,000 people “very high” and “potentially incorrect” bills, according to the memo. One borrower was told she owed $108,895.19 for the month.

Secretary of Education Dr. Miguel Cardona answers questions during the daily briefing at the White House Aug. 5, 2021.
Win McNamee | Getty Images

As student loan bills restarted in October for tens of millions of Americans, the companies that service those loans made errors that potentially violate federal and state consumer protection laws.
In a memo quietly published Wednesday night on the U.S. Department of Education’s website, senior officials in the department’s office of Federal Student Aid detail how some of its servicers botched the return to repayment, and possibly put the government at “substantial reputational risk.”

“The restart of repayment has caused pure chaos for nearly 3 million borrowers,” said higher education expert Mark Kantrowitz, who reviewed the memo at CNBC’s request.
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Education Department staff said in the memo that they had identified 78,000 borrowers who received incorrect monthly bills under the Biden Administration’s new Saving on a Valuable Education, or SAVE, plan. That plan, which was touted as the “most affordable repayment plan ever,” was meant to ease the transition back to payments for borrowers. Federal student loan payments had been on pause for over three years until they resumed last month.
Yet one woman who signed up for the SAVE plan got a bill for $355, the memo notes, when she was only supposed to owe $58. Her bill before the pandemic was $130 per month.
More than 21,000 people were billed “very high” and “potentially incorrect” amounts, according to the memo. One borrower was told they owed $108,895.19 for the month. (That was their total balance, but their servicer had erroneously reduced their loan term to two months from 120 months.)

The Education Department pays the companies that service its federal student loans — including Mohela, Nelnet and EdFinancial — more than $1 billion a year to do so.
The memo also details the problems that resulted from Mohela’s failure to send timely billing statements to 2.5 million borrowers this fall, including some 830,000 people becoming delinquent. The department announced last month that it will withhold $7.2 million in payments to Mohela in October for those errors.
Student loan servicers have diminished their call center capacity by reducing their hours and hiring less experienced representatives, Education Department officials wrote. It described many people waiting an hour or more on the phone to reach someone, and half of borrowers failing to get through to anyone at their servicer.

Scott Buchanan, executive director of the Student Loan Servicing Alliance, a trade group for federal student loan servicers, said the government and insufficient funding was largely to blame for the mess.
“We have long warned these potential issues would arise with the government choosing to not pay for more staff and resources,” Buchanan said. More

The Federal Reserve left interest rates unchanged at the end of its two-day policy meeting.
For consumers, it won’t get any less expensive to carry credit card debt, buy a house, purchase a car or tap into home equity.
Here’s a breakdown of how the Fed’s decision affects your money.

The Federal Reserve left its target federal funds rate unchanged for the second consecutive time Wednesday.
Even so, consumers likely will get no relief from current sky-high borrowing costs.

Altogether, Fed officials have raised rates 11 times in a year and a half, pushing the key interest rate to a target range of 5.25% to 5.5%, the highest level in more than 22 years. 

“Relief for households isn’t likely to come soon, at least not directly in the form of a cut in the fed funds rate,” said Brett House, economics professor at Columbia Business School.
The consensus among economists and central bankers is that interest rates will stay higher for longer, or until inflation moves closer to the central bank’s 2% target rate.

What the federal funds rate means for you

The federal funds rate, which is set by the central bank, is the interest rate at which banks borrow and lend to one another overnight. Although that’s not the rate consumers pay, the Fed’s moves still affect the borrowing and savings rates they see every day.
To a certain extent, many households have been shielded from the brunt of the Fed’s rate hikes so far, House said. “They locked in fixed-rate mortgages and auto financing before the hiking cycle began, in some cases at record-low rates during the pandemic.”

However, higher rates have a significant impact on anyone tapping a new loan for big-ticket items such as a home or a car, he added, and especially for credit card holders who carry a balance.
Here’s a breakdown of how it works.

Credit card rates are at all-time highs

Since most credit cards have a variable rate, there’s a direct connection to the Fed’s benchmark. As the federal funds rate rose, the prime rate did as well, and credit card rates followed suit.
Credit card annual percentage rates are now more than 20%, on average — an all-time high. Further, with most people feeling strained by higher prices, more cardholders carry debt from month to month.

“Rising debt is a problem,” said Sung Won Sohn, professor of finance and economics at Loyola Marymount University and chief economist at SS Economics.
“Consumers are using a lot of credit card debt and paying very high interest rates,” Sohn added. “That doesn’t bode well for the long-term economic outlook.”
For those borrowers, “interest rates staying higher for a longer period underscores the urgency to pay down and pay off costly credit card debt,” said Greg McBride, chief financial analyst at Bankrate.com.

Home loans: Deals slow to ‘standstill’

Although 15-year and 30-year mortgage rates are fixed and tied to Treasury yields and the economy, anyone shopping for a new home has lost considerable purchasing power, partly because of inflation and the Fed’s policy moves.
The average rate for a 30-year, fixed-rate mortgage is up to 8%, the highest in 23 years, according to Bankrate.
“Purchase activity has slowed to a virtual standstill, affordability remains a significant hurdle for many and the only way to address it is lower rates and greater inventory,” said Sam Khater, Freddie Mac’s chief economist.

Prospective buyers attend an open house at a home for sale in Larchmont, New York, on Jan. 22, 2023.
Tiffany Hagler-Geard | Bloomberg | Getty Images

Other home loans are more closely tied to the Fed’s actions. Adjustable-rate mortgages and home equity lines of credit, or HELOCs, are pegged to the prime rate. Most ARMs adjust once a year after an initial fixed-rate period. But a HELOC rate adjusts right away. Now, the average rate for a HELOC is near 9%, the highest in over 20 years, according to Bankrate.
Still, Americans are sitting on more than $31.6 trillion worth of home equity, according to Jacob Channel, senior economist at LendingTree. “Owing to that, many homeowners could benefit from tapping into the equity they’ve built with a home equity loan or line of credit.”

Auto loan payments get bigger

Student loans: New borrowers take a hit

Federal student loan rates are also fixed, so most borrowers aren’t immediately affected by the Fed’s moves. But undergraduate students who take out new direct federal student loans are now paying 5.50% — up from 4.99% in the 2022-23 academic year and 3.73% in 2021-22.
The government sets the annual rates on those loans once a year, based on the 10-year Treasury.
If the 10-year yield stays near 5%, federal student loan interest rates could increase again when they reset in the spring, costing student borrowers even more in interest.

Savings account holders are earning more

“Borrowers are being squeezed, but the flipside is that savers are benefiting,” McBride said.
While the Fed has no direct influence on deposit rates, the yields tend to be correlated to changes in the target federal funds rate. The savings account rates at some of the largest retail banks, which were near rock bottom during most of the Covid pandemic, are currently up to 0.46%, on average, according to the Federal Deposit Insurance Corp.
“Average rates have risen significantly in the last year, but they are still very low compared to online rates,” added Ken Tumin, founder and editor of DepositAccounts.com.
Some top-yielding online savings account rates are now paying more than 5%, according to Bankrate, which is the most savers have been able to earn in nearly two decades.
“Savings are now earning more than inflation, and we haven’t been able to say that in a long time,” McBride said.
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Year-end Planning

The IRS has increased the 401(k) plan contribution limits for 2024, allowing employees to defer up to $23,000 into workplace plans, up from $22,500 in 2023.
The agency also boosted contributions for individual retirement accounts to $7,000 for 2024, up from $6,500.

Andresr | E+ | Getty Images

The IRS has announced new 2024 investor contribution limits for 401(k) plans, individual retirement accounts and other retirement accounts.
The employee contribution limit for 401(k) plans is increasing to $23,000 in 2024, up from $22,500 in 2023, and catch-up contributions for savers age 50 and older will remain unchanged at $7,500. The new amounts also apply to 403(b) plans, most 457 plans and Thrift Savings Plans.

More from Year-End Planning

Here’s a look at more coverage on what to do finance-wise as the end of the year approaches:

The agency also boosted contribution limits for IRAs, allowing investors to save $7,000 in 2024, up from $6,500 in 2023. Catch-up contributions will remain unchanged at $1,000.
In 2024, more Americans may qualify for Roth IRA contributions, with the adjusted gross income phaseout range rising to between $146,000 and $161,000 for single individuals and heads of households, up from between $138,000 and $153,000 in 2023.

The Roth IRA contribution phaseout for married couples filing together will rise to between $230,000 and $240,000 in 2024, up from between $218,000 and $228,000.
The IRS also increased income ranges to qualify for the retirement savings contributions credit and the ability to deduct pretax IRA deposits with a workplace plan.Don’t miss these stories from CNBC PRO: More