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Americans plan to spend $14.6 billion on their significant others for Valentine’s Day, according to the National Retail Federation.
While consumers may not feel great about the broader economy, “they still feel very willing to spend on what’s important to them,” said Katherine Cullen, vice president of industry and consumer insights at the National Retail Federation.

Sanja Radin | E+ | Getty Images

It seems that love is in the air, and so is the spending as more people are apparently getting into the Valentine’s Day spirit this year.
Americans shopping for their significant others are expected to spend $14.6 billion this year, according to the latest annual survey by the National Retail Federation and Prosper Insights & Analytics. That is up from $14.2 billion in 2024.

The survey polled 8,020 adult consumers about their Valentine’s Day shopping plans in early January.
Despite strong spending trends, inflation could play a role in whether consumers choose to splurge or scale back, experts say. To that point, this record Valentine’s Day spending comes at a time when inflation is still relatively high in the U.S. The consumer price index, an inflation gauge, jumped 3% for the 12 months ending in January, according to the Bureau of Labor Statistics. 
The January reading is up from 2.9% in December, the fourth consecutive month of increases in the annual inflation rate when it was at 2.4% in September.
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While consumers may not feel great about the broader economy, “they still feel very willing to spend on what’s important to them,” said Katherine Cullen, vice president of industry and consumer insights at the National Retail Federation.

“These moments of celebration throughout the year have really seemingly grown in the consumer psyche,” or “becoming moments of joy,” she said.
“We’ve also seen people more likely than before the pandemic to say that they’re really living in the moment because the future is a little more uncertain,” Cullen added.
It can be a nice experience to splurge on the holiday. But if you find yourself with a tighter budget this year, there are financially savvy ways you can express your love, experts say. 

How Americans are spending for Valentine’s Day

The National Retail Federation found that candy was the most popular Valentine’s gift. More than half, or 56%, of surveyed respondents plan to give candy, followed by flowers and greeting cards equally at 40%, an evening out at 35% and jewelry at 22%. 

According to the NRF report, shoppers plan to spend approximately $6.5 billion on jewelry, with further spending allocated toward “an evening out” at $5.4 billion and flowers at $2.9 billion.
As you browse online or hit the stores for Valentine’s Day shopping, it can be tempting to put the purchases on your credit card. Before you do, keep in mind that Americans’ total credit card balance is $1.211 trillion as of the fourth quarter of 2024, according to the latest consumer debt data from the Federal Reserve Bank of New York. That is up from $1.166 trillion in the third quarter of 2024 and is the highest balance since the New York Fed began tracking in 1999.
If you can’t afford to make these purchases, here are ways to celebrate the holiday without going over budget, according to experts:

1. ‘Shift your Valentine’s Day’

If you can’t make dinner or evening plans on Valentine’s Day this year, consider celebrating the holiday on a different date, experts say. 
“Shift your Valentine’s Day,” said Carolyn McClanahan, a physician and certified financial planner and the founder of Life Planning Partners in Jacksonville, Florida.
If you’re willing to go out the night before or the night after or more, the move “can potentially be a way to save,” said Ted Rossman, a senior industry analyst at Bankrate.

2. Make a special meal at home

Try to make some adaptations if you’re unable to shift the date or be flexible with timing, Rossman said. 
For instance, red roses go “sky high around Valentine’s Day,” he said. “Maybe you could get a different type of flower.”
If you’re having a hard time booking reservations or costs are too high, try cooking a special meal at home, or something that you wouldn’t normally prepare, experts say.
“Buy yourself a really good bottle of wine and cook something special,” said McClanahan, who is also a member of CNBC’s Financial Advisor Council.

3. A meaningful gift

If you plan to give your significant other an extravagant gift such as a piece of jewelry, keep this in mind: “The more expensive the jewelry doesn’t mean the more love you’re giving,” McClanahan said.
Instead of jumping immediately to high ticket-price items, consider what your gift-giving history with each other has been, McClanahan said.
“Get something special that may not be as expensive, something a person would really want,” she said. More

Many taxpayers could receive Form 1099-K for the first time this season, according to the National Taxpayer Advocate.
If you had more than $5,000 in business transactions from apps like PayPal or Venmo or online marketplaces like eBay, you could receive Form 1099-K for 2024.
However, business income should be reported on your tax return even if you don’t receive the form.

Artistgndphotography | E+ | Getty Images

As millions of Americans gather paperwork to file their returns, many could see a tax form for business payments “for the first time ever,” according to the National Taxpayer Advocate.
For 2024, if you had more than $5,000 in business transactions from apps like PayPal or Venmo, along with online marketplaces like eBay, you could receive Form 1099-K, which reports that income to the IRS.

The 2024 reporting threshold is down from the 2023 limit of more than 200 payments worth above $20,000. For 2025, the threshold drops to more than $2,500 no matter the number of transactions, and a limit above $600 applies to calendar year 2026 and beyond, according to IRS guidance released in November.
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Congress enacted the $600 reporting threshold via the American Rescue Plan of 2021, but the IRS has delayed the threshold change amid bipartisan scrutiny from lawmakers and complaints from the tax community.
The IRS in 2023 unveiled phased-in limits to “avoid problems for taxpayers, tax professionals and others,” former IRS Commissioner Danny Werfel said in a statement at the time.

How to report Form 1099-K on your return

While the 1099-K reporting threshold is lower for 2024, “there are no changes in what counts as income,” said April Walker, lead manager for tax practice and ethics with the American Institute of CPAs. “This is just a reporting mechanism.”

This season, you could receive Form 1099-K after selling items, such as vehicles, furniture, clothing or concert tickets via payment apps. You could also see the form for services paid via such platforms. However, “personal payments” between family and friends shouldn’t be reported via Form 1099-K, according to the IRS.

If you made a profit selling an item — meaning the sales price is more than what you originally paid — you need to report that gain on Form 8949 and Schedule D.
You can’t deduct items sold at a loss, but you should “zero out” the gross income at the top of Schedule 1 so you don’t owe taxes on the reported income, according to the IRS. The same strategy applies if you receive Form 1099-K for personal payments.
But if you’re subtracting these payments on Schedule 1, you should keep records, such as receipts, to prove the income isn’t taxable, Walker said. More

As an agency authorized by Congress, the Education Department cannot be eliminated without congressional approval.
But in the meantime, the Trump administration, Elon Musk and his DOGE team can slowly cripple it.
While some of the department’s programs may be transferred to other agencies, that transition could cause major disruptions to the nation’s $1.6 trillion student loan program, experts say.

The Trump administration has already begun carrying out its plans to close parts or all of the Department of Education, which is responsible for underwriting student loans, disbursing college aid and ensuring equal access to education.
President Donald Trump campaigned on a pledge to “find and remove the radicals who have infiltrated the federal Department of Education,” and suggested that Linda McMahon, his nominee for Education secretary, would help gut the department.

McMahon’s Senate confirmation hearing began Thursday morning.
“I want Linda to put herself out of a job,” Trump said at a White House press conference Feb. 4.

Linda McMahon, former administrator of the US Small Business Administration and US education secretary nominee for US President Donald Trump, during a Senate Health, Education, Labor, and Pensions Committee confirmation hearing in Washington, DC, US, on Thursday, Feb. 13, 2025.
Al Drago | Bloomberg | Getty Images

Former President Jimmy Carter established the U.S. Department of Education in 1979. Since then, the department has faced other existential threats. Former President Ronald Reagan called for its end, and Trump, during his first term, attempted to merge it with the Labor Department.
Efforts by the Trump administration to dismantle the Education Department will face criticism.
To that point, 61% of likely voters say they would oppose the Trump administration’s use of an executive order to abolish the Education Department, according to a poll conducted by Data for Progress on behalf of the Student Borrower Protection Center and  Groundwork Collaborative. Meanwhile, just 34% of respondents approve of such a move. The survey of 1,294 people was conducted Jan. 31 to Feb. 2.

Deep cuts already underway

As an agency authorized by Congress, the Education Department cannot be eliminated without congressional approval.
But in the meantime, the Trump administration, Elon Musk and his advisory group known as the Department of Government Efficiency can slowly cripple it.
Already, the Institute of Education Sciences, the research arm of the Education Department, was scaled down significantly by Musk’s DOGE team.
In a statement Monday, the American Educational Research Association and the Council of Professional Associations on Federal Statistics said 169 contracts were canceled, including some related to the collection and reporting of education statistics.
“Sensible public policy for education depends on strong research and basic collection and availability of data on institutional performance and student outcomes,” said Sameer Gadkaree, president and CEO of The Institute for College Access & Success.  “Without it, Americans will be in the dark on shifts in debt, student success, and how public dollars should be invested to increase effectiveness.”
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Some experts say further dismantling the Education Department could have serious economic consequences.
“Most of the Department’s budget funds federal student aid for higher education, subsidies for elementary and secondary schools with large shares of students from low-income families, and special education programs for children with special needs,” said Brett House, economics professor at Columbia Business School.
“While some of the Department’s funding programs may be transferred to other agencies, there is no guarantee that they would be continued at the same scale or impact,” House said.

Student loans could be administered by Treasury

Even if the Education Department no longer existed, another government agency would likely administer the task of distributing student financial aid funds, experts say.
Some experts have speculated that the Treasury Department would be the next most logical agency to administer student debt. However, it’s uncertain whether Treasury would be as focused on students as the Education Department, said former U.S. Under Secretary of Education James Kvaal.
“People take out student loans at a very young age, and Congress created all these benefits that are available on student loans that aren’t available on other types of credit,” Kvaal said. “There’s a question if the Treasury would have the same ethic of prioritizing students.”
Instead, “Would they [the Treasury] prioritize loan collection?” Kvaal asked.
“One of the intents [of the administration’s actions] is to redistribute funding from the federal department of education to states and localities,” said Tomas Philipson, a professor of public policy studies at the University of Chicago and former acting chair of the White House Council of Economic Advisers. 
“If such a redistribution takes place, this will likely improve, as opposed to hurt, learning as state and locals are better suited to address their heterogeneous needs,” Philipson said. “The one-size-fits-all nature of federal regulations and spending programs can often be improved upon.” 
Still, no other agency is equipped to service a $1.6 trillion student loan program, according to Karen McCarthy, vice president of public policy and federal relations at the National Association of Student Financial Aid Administrators.
“It wouldn’t be an easy process to make that transfer,” McCarthy said. “Our biggest concern is that if something like that were to happen, it wouldn’t go smoothly.”
The process could potentially unsettle millions of current college students, as well as the more than 42 million borrowers with federal student loan debt, she said.
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Iron Mountain shares have struggled this week after Elon Musk mentioned the company’s processing and storage of retirement records in a Pennsylvania mine.
But the company said other parts of its business can actually benefit from the push for a more efficient government.
Wall Street analysts dismissed the declines in the stock following Musk’s comments.

A man exits the Iron Mountain Inc. data storage facility in Boyers, Pennsylvania, U.S., on Tuesday, Feb. 13, 2018. The underground data center, located in a former limestone mine, stores 200 acres of physical data for many clients including the federal government.
Stephanie Strasburg | Bloomberg | Getty Images

Elon Musk stood beside a seated President Donald Trump in the Oval Office on Tuesday and ranted about examples of government inefficiency his DOGE department was seeking to root out of the federal government.
“There’s a limestone mine where we store all the retirement paperwork…This mine looks like something out of the ’50s, because it was started in 1955, so it looks like it’s, like, a time warp,” said Musk, who went on to explain that the mine’s elevator speed determines the pace at which the government can process the retirements of federal employees.

“Doesn’t that sound crazy?,” he asked.
That mine is run by a little-known company named Iron Mountain, whose shares were hit this week in the wake of Musk’s comments.
But Iron Mountain CEO Bill Meaney on Thursday said that he sees the new government efficiency initiative led by Musk as a “growth opportunity,” given the company’s other work in digital transformation with federal agencies.
“We see this as a continued opportunity for the company,” Meaney told analysts during Iron Mountain’s Thursday morning earnings call. Earlier, he said this digitizing arm of the company aligns with the “drive to be more efficient” within the federal government and noted “recent interest” in Iron Mountain’s federal business dealings.
Meaney said Iron Mountain rakes in $130 million in revenue from its data center and digitization transformation businesses. That figure dwarfs the $10 million earned from the government storing physical documentation in sites like the namesake Iron Mountain mine. In all, Meaney said that $10 million accounts for less than half of one percentage point of Iron Mountain’s total physical volume.

‘Working in a mine shaft’

The Pennsylvania mine, which was the focus on Musk’s statements about the company, is where the federal government houses and processes retirement paperwork more than 200 feet underground. Located less than an hour outside of Pittsburgh, the mine is billed by the company as offering “unbeatable” levels of security and protection from disasters.

The interior of the Corbis Film Preservation Facility, located in an Iron Mountain underground storage facility in Pennsylvania. The 10,000-square-foot Corbis facility houses over 13 million photographic negatives, engravings and prints. 
James Leynse | Corbis Historical | Getty Images

DOGE — the acronym for the Department of Government Efficiency — has been central to conversations and criticisms around President Trump’s return to the White House as Musk’s team scours federal agencies for fat to cut. Musk’s comments about the government’s contracts with Iron Mountain bring attention to a quirky setup for document storage used by the federal government, which has been under Republican scrutiny for a perceived lack of efficiency.
Additionally, these comments — and the company’s subsequent explanation of its work — can offer a roadmap for what firms that work with federal agencies can expect amid the Trump administration’s focus on slashing spending.
Musk’s critical analysis of Iron Mountain’s work with the federal government appeared to hurt the stock as concerns mounted that the contracts could be on the chopping block. Shares have dropped more than 10% so far this week, pulling the stock down more than 9% on the year. (A large chunk of those declines came in Thursday’s session as investors reacted to the company’s slight miss on revenue expectations from analysts.)

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Iron Mountain, 5-day chart

DOGE posted photos of the mine on X, the social media platform owned by Musk. Text accompanying the photos noted that more than 700 employees work in the mine, and Musk said that at most 10,000 retirement applications can be processed each month through this system.
“Instead of working in a mine shaft and carrying manila envelopes to boxes in a mine shaft, you could do practically anything else, and you would add to the goods and services of the United States in a more useful way,” Musk said.

FILE PHOTO: Elon Musk speaks as his son X ? A-12 and U.S. President Donald Trump listen in the Oval Office of the White House in Washington, D.C., U.S., February 11, 2025. 
Kevin Lamarque | Reuters

In describing Iron Mountain’s work with government entities, Meaney told analysts the company partners with more than 200 federal government agencies as either a direct provider or subcontractor of services. Additionally, he also pointed to an agreement with a state government for a hard drive destruction program that can be used within its agencies.

‘A big overreaction’

Wall Street, for its part, sees the stock’s decline following Musk’s comments and the DOGE post as unreasonable.
“We view it as a big overreaction,” Wells Fargo analyst Eric Luebchow wrote to clients on Wednesday.
Luebchow said the company’s revenue is not driven by any single customer, meaning that it likely wouldn’t take a hit even if the federal government ended its deal with the mine. If the government does pull out, Luebchow said it would likely have to pay Iron Mountain termination fees that can amount to around one or two years of annual rent.
The analyst also backed up Meaney’s claim that a focus on efficiency may actually be a boon for other parts of Iron Mountain’s business.
Barclays’ Brendan Lynch agreed, adding that the government has a legal requirement to keep records that Iron Mountain stores somewhere.
“We see this as a non-issue,” Lynch told clients on Wednesday, before recommending they “buy the weakness.” More

A new law, the Social Security Fairness Act, provides benefit increases for more than 3.2 million individuals including certain teachers, police officers, firefighters and other public servants.
Yet the Social Security Administration has said it may take more than a year to process all of the benefit changes.
“Congress either provides funding to cover the implementation costs, or SSA is going to struggle to work these cases,” one expert says.

Cavan Images | Cavan | Getty Images

More than 3.2 million individuals scored a legislative victory due to a new law that will increase the Social Security benefits for which they are eligible.
However, many of those individuals now face a lengthy wait for the extra benefit money coming to them.

The Social Security Fairness Act was signed into law on Jan. 5 by then President Joe Biden. The law eliminates certain provisions — the Windfall Elimination Provision and the Government Pension Offset — that previously reduced Social Security benefits for people who receive pensions from non-covered employment.
The changes will result in higher monthly payments ranging from $360 to $1,190, depending on their circumstances, the Congressional Budget Office has estimated. In addition, the law also provides lump-sum payments for those benefit increases dating back to benefits payable for January 2024 and after.
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The Social Security Administration is already helping some affected beneficiaries, the agency stated on its website. However, it cannot commit to a timeline as to when it will have processed the benefit increases for everyone affected.
“Under SSA’s current budget, SSA expects that it could take more than one year to adjust benefits and pay all retroactive benefits,” the Social Security Administration’s website states.

SSA will struggle without more money, expert says

On Feb. 5, a bipartisan group of Senators sent a letter to Acting Social Security Commissioner Michelle King urging for swift implementation of the benefit changes affecting certain teachers, police officers, firefighters and other public servants.
“We call for the immediate implementation of this legislation to provide prompt relief to the millions of Americans impacted by WEP and GPO,” the Senators wrote.
However, some experts say the agency needs more financial resources to make that happen.
“Congress either provides funding to cover the implementation costs, or SSA is going to struggle to work these cases,” said David A. Weaver, a former Social Security Administration executive who currently teaches statistics at the University of South Carolina.
The Social Security Fairness Act was voted into law with broad bipartisan support in both the House and Senate. Yet retirement policy experts have strongly criticized the new policy. One sticking point is the cost — estimated by the CBO to tally $200 billion over 10 years — with no offsets to help pay that increase.
That outlay will move Social Security’s trust fund depletion date six months closer, according to estimates.

The Social Security Administration is funded through a continuing resolution set to expire in the middle of March.
“When Congress addresses that … it’d be useful for Congress to increase SSA’s budget to account for the implementation costs,” Weaver said.
At a minimum, the agency will need around $200 million to implement the Social Security Fairness Act’s changes, he said.
The last time there was a similar change was with the Senior Citizens Freedom to Work Act of 2000, in which Social Security beneficiaries who had reached full retirement age no longer saw benefit reductions due to earned income.
That law affected about 1 million beneficiaries and cost about $65 million to implement in today’s dollars, according to Weaver. The new Social Security Fairness Act will affect about three times as many beneficiaries, he said.
The Social Security Administration’s staffing is currently at a 50-year low, said Dan Adcock, director of government relations and policy at the National Committee to Preserve Social Security and Medicare.
Prior to President Donald Trump taking office, it had been suggested that additional funding would help the Social Security Administration to fulfill the demands of the WEP and GPO repeal.
If instead the appropriations from Congress to the agency are reduced, the implementation of the new law may take even longer than one year, Adcock said.

Why new law may be complex to implement

As the Social Security Administration works to implement the law’s new benefit changes, the agency will face some pain points that may contribute to delays, according to Weaver.
When the Social Security Fairness Act was first introduced in 2023, the bill called for the changes to go into effect starting with benefits payable for January 2024.
As lawmakers rushed the legislation through in late December, that effective date was not changed. Calculating those back payments will create more work for the Social Security Administration, according to Weaver.
The effective date also presents other potential complications. For example, in any given year, 4% of Social Security beneficiaries die. Consequently, the Social Security Administration will be tasked with identifying more than 100,000 beneficiaries who are affected by the law who may have died in 2024 and distributing money to their survivors, Weaver said.
Moreover, individuals who were affected by the Government Pension Offset, which reduced Social Security benefits for spouses and widows of people who received non-covered pensions, may have previously been told they were not eligible for benefits, Weaver explained. As a result, in some cases they may have never applied for benefits. For those who did apply, their personal addresses or bank account information on file with the agency may be outdated, he added.
For those individuals affected by the GPO, the Social Security Administration will likely have to do a lot of work to find basic information on how to pay them, Weaver said.
For survivors and spouses who are newly eligible for benefits, the agency will also have to confirm those relationships.
The Social Security Administration may be able to automate 95% of the Windfall Elimination Provision cases, Weaver said. Yet some unusual cases may crop up, for example if a beneficiary was also affected by the earnings test. That will require manual input from Social Security employees, and therefore more time to process, Weaver said. More

Cocoa prices hit record highs in 2024 amid a global supply shortage.
Officials at companies like Barry Callebaut, Hershey, Lindt & Sprüngli Group and Mondelez have alluded to the challenge higher cocoa prices put on their chocolate business.
Expect to pay about 10% to 20% more for chocolate this Valentine’s Day than last year, one agricultural economist said.

Nurphoto | Nurphoto | Getty Images

Sorry, lovebirds, but that chocolate you’re buying for your sweetie this Valentine’s Day probably comes with a bigger price tag.
Candy is the most popular Valentine’s Day gift, beating out other tokens of affection like flowers, cards and jewelry, according to the National Retail Federation. Additionally, chocolate accounts for more than half of all confectionery sales, according to the National Confectioners Association, a trade group.

But chocolate makers have been raising prices to offset record costs for cocoa, company officials and agricultural economists said.
Consumers will likely pay about 10% to 20% more for chocolate this Valentine’s Day than they did last year, said David Branch, a commodities analyst at the Wells Fargo Agri-Food Institute.
“It’s a significant increase,” Branch said.
For example, the price of a king-size two-pack of Reese’s hearts increased by 13% from February 2024 to February 2025, to $2.59 from $2.29, according to Retail Brew. Meanwhile, the price of a 10.8-ounce bag of milk chocolate Hershey’s Kisses rose to $5.49 today from $4.89 in January 2024, a 12% increase, according to Retail Brew.
The current retail price for U.S. chocolate ranges from $3.08 to $5.72 per pound, according to Selina Wamucii, which conducts agriculture market research.

Cocoa prices ‘skyrocketed’

Cocoa is a key ingredient in chocolate: in fact it must be present to be legally described as chocolate.
West Africa — predominantly Côte d’Ivoire and Ghana — account for about 80% of world cocoa production, according to a recent JPMorgan research note.
Disease pressures, climate change and bad weather “ravaged” crops in West Africa, fueling a global cocoa shortage that has persisted since early 2024, JPMorgan said.
Cocoa prices “skyrocketed” as its availability hit historic lows, according to JPMorgan.

Global cocoa prices hit a record high on Dec. 18, when they neared $13,000 per metric ton, said Branch of the Wells Fargo Agri-Food Institute.
That’s significantly above where price levels were at the start of 2024. The average cocoa price in December — $10,846 per metric ton — was up more than 140% from the roughly $4,500 average in January 2024, Branch said.
“It’s really driven by three years of horrific weather” in West Africa, Branch said. Rainfall has been above the historic average followed by longer-than-usual dry seasons, which stress cocoa production, he added.
The cocoa supply deficit — the difference between what buyers want and what’s available — rose to 478,000 metric tons last year, the highest deficit in 60 years, Branch said.

Chocolate inflation is ‘unprecedented’

The rising cocoa prices have pressured profits for chocolate makers, leading them to raise prices for customers, experts said.
Hershey, for example, recently alluded to high cocoa prices when forecasting lower-than-expected company profits for 2025.
“Offsetting the high cocoa costs forced the Group to adjust its pricing, which will be further required in 2025,” the Lindt & Sprüngli Group, a Swiss chocolatier, said in a January release about 2024 sales results.
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The average wholesale price for chocolate and confectionery products swelled by more than 30% in January 2025 from January 2024 — a roughly fivefold increase in the inflation rate from 12 months before, according to the producer price index.
“We see the chocolate market set for inflation largely unprecedented in recent history,” Celine Pannuti, head of European staples and beverages at JPMorgan, said in the research note.
Chocolate prices in 2025 paid by consumers will likely accelerate by a double-digit percentage in the low teens, Pannuti said.
Officials at other major chocolatiers including Mondelez and Barry Callebaut alluded to a probable need for additional price hikes this year.

“The recent [cocoa] bean price spike means that further pricing will be taken in the chocolate market,” Peter Vanneste, chief financial officer of Barry Callebaut, said in a January call with analysts.
However, higher prices have also pressured consumer demand, Vanneste said.
As of mid-January, Q4 2024 data on cocoa grindings showed a year-on-year decline, “an indicator that cocoa demand is plummeting,” according to the International Cocoa Organization.
Consumers purchased $21.4 billion of chocolate during the year ended Aug. 11, 2024, up 1.5% from the prior year, according to the most recent data available from the National Confectioners Association. But sales volume declined by 3% over that period, even as the retail dollar value of those sales rose, the data shows.
The data signals consumers are paying more and buying less, Branch said.
“The market is kind of in turmoil, and will pretty much stay that way for this [cocoa] season,” he said.

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Collectively, Americans owe a record $1.21 trillion on their credit cards, according to a new report from the Federal Reserve Bank of New York.
Consumer spending has remained remarkably resilient, even in the face of high interest rates.

Asiavision | E+ | Getty Images

Collectively, Americans now owe a record $1.21 trillion on their credit cards, according to a new quarterly report on household debt from the Federal Reserve Bank of New York.
Credit card balances jumped by $45 billion in the fourth quarter of 2024, driven in part by holiday spending, and are now 7.3% higher than a year ago.

At the same time, credit card delinquency rates “remained elevated,” the New York Fed researchers found — with 7.18% of balances transitioning to delinquency over the last year. That uptick could indicate “borrowers are having some difficulty repaying,” the researchers said on a press call Wednesday.

“No one should be surprised that credit card debt hit another record high,” said Matt Schulz, chief credit analyst at LendingTree and the author of “Ask Questions, Save Money, Make More.”
“Stubborn inflation has shrunk a lot of Americans’ financial margin for error from slim to about none, forcing people to lean more heavily on credit card debt,” Schulz said.
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Credit card debt has remained stable over the last two decades. However, in the years since the pandemic, households largely spent down their excess savings, which sparked a rebound in credit card balances. Consumer spending continues to remain strong, despite high borrowing costs.

“There’s very little reason to believe that we won’t continue to see new credit card debt records being set going forward,” Schulz said.

Credit card rates top 20%

Meanwhile, credit cards have become one of the most expensive ways to borrow money.
Lower-income households that had to stretch to cover price increases, have been hit especially hard after the Federal Reserve’s string of interest rate hikes lifted the average credit card rate to more than 20% — near an all-time high.
Even as the Fed lowered its benchmark at the end of last year, the average credit card rate barely budged.
“For people who are carrying a balance … a higher interest rate is going to make those balances rise more quickly, it’s also going to make the payments higher on a monthly basis,” the New York Fed researchers said.

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Staffers from Elon Musk’s secretive government slashing effort, DOGE, have pushed the highest Department of Education officials out of their own offices, rearranged the furniture and set up white-noise machines to muffle their voices, employees at the agency said.
Instead of collaborating with Trump officials, the DOGE employees appear to be competing with one another to make the biggest budget cuts, employees said.
What’s more, the DOGE teams’ budget-cutting demands appear to be arbitrary, and not rooted in any political or policy goals, employees said.

Elon Musk speaks next to President Donald Trump, not pictured, in the Oval Office of the White House in Washington, D.C., Feb. 11, 2025.
Kevin Lamarque | Reuters

Staffers from Elon Musk’s secretive government slashing effort, DOGE, have pushed the highest-ranking officials at the Department of Education — even those recently appointed by President Donald Trump — out of their own offices, rearranged the furniture and set up white noise machines to muffle their voices, employees at the agency said.
Deprived of her office, acting Education Secretary Denise Carter was spotted last week sitting outside the main leadership suite, one staffer said. Meanwhile, acting Under Secretary James Bergeron held off moving into his office, sources told CNBC, because DOGE staffers were occupying it.

“They took over the top real estate; they made themselves at home,” an official told CNBC. “It was that attitude of, ‘We can do whatever we want.'”

A view of the U.S. Department of Education building in Washington, D.C., U.S., Feb. 1, 2025. 
Annabelle Gordon | Reuters

Sources for this story were granted anonymity because they feared retribution if they were named.
Having taken over the VIP offices on the seventh floor of the agency’s headquarters in Washington, D.C., representatives of the task force known as the Department of Government Efficiency then went looking for office equipment around the building to “move into their compound,” an Education Department staffer told CNBC.
Asked about the working arrangements and office space, deputy assistant secretary for communications Madi Biedermann told CNBC, “The DOGE employees are federal employees. They have been sworn in, have the necessary background checks and clearances, and are focused on making the Department more cost-efficient, effective, and accountable to the taxpayers.”
Trump has repeatedly stated his intention to dismantle the Department of Education. As an agency authorized by Congress, the department cannot be eliminated without congressional approval.

But in the meantime, Musk and his DOGE team can slowly starve it.

A White House spokesperson did not respond to questions from CNBC about the workflow at the Education Department.
Trump’s nominee to lead the Department of Education, Linda McMahon, will have her confirmation hearing Thursday.
Education Department officials described tension between the DOGE team and department leadership — including Republicans who arrived at the department to help implement a conservative education agenda.
Asked about the workplace dynamics, Biedermann said the DOGE staffers “are working in collaboration with Department staff. There is nothing inappropriate or nefarious going on.”
According to employees, however, the DOGE teams appear to be competing with one another to get a very big headline on budget cuts.
On Monday, that headline was indeed very big: “$881 million” worth of contracts with the Education Department had been canceled, according to the DOGE social media account.
This competitive element of the DOGE cost-cutting effort is likely due in part to the rules that govern the DOGE staffers’ employment.
Most DOGE workers are designated as “special government employees,” a category that insulates them from some federal disclosure requirements. But in exchange, the status limits the total number of days they can work per year to 130.
The way the DOGE teams appear to be operating, they have about four months to make all the cuts they can. After that, the agencies will be left to deal with the fallout.

DOGE’s shifting demands

Day to day, the DOGE team members have been “secretive,” a current staffer said. “They didn’t make conversation.”
Some employees said they feel they need to physically stay out of the way of DOGE staffers, and one official described the overall vibe from the team as “intimidating.”
Constantly shifting demands from DOGE employees about how much funding they need to cut have left employees confused and afraid, two employees told CNBC.
What’s more, they said, the demands of DOGE teams appear to be arbitrary, and not rooted in any political or policy goals.

In many cases, the DOGE teams don’t tell department staffers which contracts they need to cancel, employees said.
Instead, staffers are given a figure, typically in person rather than in writing, and told to cut that much money from programs, sources report. Other times they were given a percentage of funding and told to cut that much.
One employee recalled a demand by DOGE employees to slash around 80% of the funding for websites and services that support federal student loan applications.
Around 17 million families apply for college aid each year using the Free Application for Federal Student Aid, or FAFSA, according to higher education expert Mark Kantrowitz. More