Investing

Jim Umpleby, CEO of Caterpillar Inc.
Adam Jeffery | CNBC

During these challenging times, making informed decisions with a long-term view is vital for investors.
Here are five stocks chosen by Wall Street’s top analysts, according to TipRanks, a platform that ranks analysts based on their track records.

Advanced Micro Devices

Semiconductor company Advanced Micro Devices’ (AMD) fourth-quarter results surpassed Street expectations even as continued weakness in the PC market dragged down the company’s client segment revenue. Nevertheless, higher sales from the data center and embedded divisions helped offset the weakness in the client and gaming segments.
Although AMD expects its revenue in the first quarter of 2023 to decline by about 10%, CEO Lisa Su remains optimistic about the company’s ability to win market share this year.
Susquehanna analyst Christopher Rolland said the company’s client and gaming results were better than feared. However, he noted that management’s weaker data center outlook for the first half was a “surprise.”
“While sales into North American hyperscalers more than doubled in 2022, management believes cloud is now undergoing a period of digestion in 1H, returning to growth in 2H (we think helped by ramps of Genoa, Bergamo, MI300 and Pensando, all of which are on track),” explained Rolland about the data center segment guidance. (See AMD Blogger Opinions & Sentiment on TipRanks)
Overall, Rolland reiterated a buy rating for AMD with a price target of $88, saying he prefers to look beyond the uncertainty in 2023 “towards a better 2024.” Rolland’s conviction is worth trusting, given that he is ranked at the 13th position among more than 8,300 analysts tracked by TipRanks. Moreover, 72% of his ratings have been profitable, with each generating a 21% average return.

Tesla

Leading electric vehicle maker Tesla’s (TSLA) upbeat fourth-quarter results wiped out investors’ concerns about supply chain disruptions, the distraction related to Elon Musk’s Twitter acquisition, and the recently announced price cuts.
Tesla is focused on reducing costs and enhancing productivity to combat the near-term macroeconomic pressures and rising competition. Taking into account potential supply chain issues and other possible headwinds, the company issued production guidance of 1.8 million EVs in 2023, even though it has the potential to make 2 million units.
Mizuho Securities analyst Vijay Rakesh projects Tesla’s revenue will grow 29% this year and 26% in 2024. The analyst highlighted that his conservative growth estimates reflect “potentially slowing macro demand offset by secular EV transitional trends.”
Rakesh reaffirmed a buy rating and $250 price target, pointing out that Tesla has industry-leading margins and is on the path to deliver more than $10 billion in free cash flow, compared to rivals who are still at negative free cash flow. (See Tesla Hedge Fund Trading Activity on TipRanks)​
Rakesh holds the 113th position among more than 8,000 analysts tracked on TipRanks. Additionally, 60% of his ratings have been successful and have generated a 17.4% average return.

McDonald’s  

After fast-moving EVs, fast-food giant McDonald’s (MCD) is next on our list. McDonald’s topped expectations, as the restaurant chain witnessed better-than-anticipated traffic at its domestic stores in the final quarter of 2022.
McDonalds’ delivered robust comparable sales across the domestic and international markets, thanks to “strategic menu price increases” in the U.S., attractive menu offerings, and marketing campaigns like the Happy Meal offering for adults. (See McDonald’s Dividend Date & History on TipRanks)  
Despite tough macro conditions, McDonald’s intends to expand further to grab additional business. It plans to open about 1,900 restaurants, with over 400 of these locations in the U.S. and the International Operated Markets segments. The remaining restaurants will be opened by developmental licensees and affiliates.  
BTIG analyst Peter Saleh, who reiterated a buy rating and $280 price target, expects McDonald’s to gain from “moderating inflation, carryover pricing, easing lockdowns in China, and foreign exchange finally becoming a modest tailwind.”
Saleh ranks 383 out of more than 8,300 analysts on TipRanks, with a success rate of 65%. Each of his ratings has delivered a 12.3% return on average.

Mondelez International

Mondelez International’s (MDLZ) recent results reflected the advantages of being a manufacturer of resilient product categories like chocolate, cookies and baked snacks. The Oreo-brand owner delivered robust revenue growth, fueled by higher pricing, increased volumes and strategic acquisitions, including Chipita and Clif Bar.
Despite currency headwinds and higher costs, Mondelez is positive about driving “attractive growth” in 2023 and beyond by increasing its exposure to high-growth categories, cost discipline, and continued investments in iconic brands. (See MDLZ Stock Chart on TipRanks) 
J.P.Morgan analyst Kenneth Goldman, who ranks 652 out of over 8,300 analysts tracked by TipRanks, feels that it is “refreshing to see at least one company surprise to the upside” on the volumes front amid growing concerns about this key metric in the staples industry.
Given the likelihood of several food producers reporting weak volumes in the coming days, Goldman said it could “become increasingly important to own stocks of companies with (a) relatively inelastic categories, (b) strong and unique brands with limited private label competition, and (c) a commitment to continually spending behind their brands.”
In line with his bullish stance, Goldman reiterated a buy rating and increased his price target to $74 from $71. It’s worth noting that 61% of his ratings have been successful, generating a 9.3% average return.  

Caterpillar

Construction and mining equipment maker Caterpillar (CAT) ended 2022 with a double-digit increase in revenue in the fourth quarter, driven by steady demand and higher pricing. However, investors seemed concerned about the impact of rising input costs and the strengthening U.S. dollar on the company’s bottom line.
Furthermore, Caterpillar’s warning about weaker China demand in 2023 didn’t go down well with the shareholders. Nonetheless, the company is optimistic about higher overall sales and earnings this year due to healthy demand across its segments.
Jefferies analyst Stephen Volkmann reaffirmed a buy rating following the Q4 print and maintained a price target of $285. Volkmann called the company’s pricing strength as “the standout positive.”
The analyst also noted that the demand for Caterpillar’s products remains strong, as indicated by a $400 million rise in the order backlog in the fourth quarter on a sequential basis. (See Caterpillar’s Insider Trading Activity on TipRanks) 
Volkmann’s recommendations are worth paying attention to, given that he stands at the 51st position out of 8,300 plus analysts tracked by TipRanks. Remarkably, 69% of Volkmann’s ratings have generated profits, with each rating bringing in a 19.9% average return.

WATCH LIVEWATCH IN THE APP More

Rising food costs are pushing consumers to get more creative about where they go for groceries.
Discount dollar stores are becoming a key destination for affordable essentials, including perishable and nonperishable goods, according to a recent report.
Savings experts share their top tips to cut costs no matter where you shop.

A man looks at frozen foods for sale at a Dollar Store in Alhambra, California on August 23, 2022.
Frederic J. Brown | AFP | Getty Images

Among all rising costs, sky-high grocery bills have been especially painful.
Although the consumer price index, an inflation gauge that measures the cost of a broad basket of goods and services, started to ease as of the latest reading, food prices were up yet again, the U.S. Department of Labor reported.

Over the past year, food prices overall have risen more than 10%. Egg prices, alone, soared 60%, butter is up more than 31% and lettuce jumped 25%, according to Labor Department data through December.
As a result, consumers are looking for any — and all — ways to save. For some, that means shopping at their local dollar store.

Dollar stores are pulling in more grocery shoppers

Slowly but surely, discount dollar stores’ share of total grocery spending has been creeping up, according to a recent report from Coresight Research. Already, more than 1 in 5 consumers buy groceries at dollar stores, according to Coresight’s weekly U.S. Consumer Tracker.
A separate study published in the American Journal of Public Health also found that dollar stores were the fastest-growing food retailers, in part because they are expanding at an unmatched pace, especially in rural areas.
More from Personal Finance:64% of Americans are living paycheck to paycheckAlmost half of Americans think we’re already in a recessionWhy inflation soared for 10 items in 2022

To lure shoppers, the country’s category giants — Dollar General and Dollar Tree, which owns Family Dollar — have been adding stores and remodeling with more refrigeration units and expanded grocery offerings, including healthier foods and fresh produce, the Coresight report found.
“If the two retailers continue to improve the quality of their fresh food while maintaining the low prices associated with their brands, there is a high chance it will bolster their value proposition with their existing consumer base and also pull in new customers from higher-priced retailers,” the report said.

‘It’s about making your dollar go a little further’

These days, shoppers are considering alternatives, especially if it means better prices, said Julie Ramhold, consumer analyst with DealNews. “It’s about making your dollar go a little further.”
However, the value is not always there, she added. Despite the name, “you will be hard-pressed to find items that are just a dollar.” It’s important to check the unit price and compare with the offerings at other stores, including Walmart and Trader Joe’s, Ramhold said.

In addition, the grocery assortment will still be smaller than what you would find at a supermarket or a warehouse club. For example, the selection of fruits and vegetables may be limited to more shelf-stable offerings like bagged salad mixes and bananas, Ramhold said.
Further, with less turnover, you are more likely to find items near the expiration date. “It’s important to check ‘best by’ dates,” she cautioned.

To that end, Ramhold advises shoppers to focus on staples, such as rice, pasta and dried beans, which can also be tailored to fit different cuisines and don’t cost very much.
(“The Dollar Store Cookbook,” available on Amazon, has recipes that are mostly limited to such pantry-stable ingredients, including a creamed tuna on toast made with canned tuna and cream of celery soup.)

Top tips for saving on groceries

With food inflation persisting, savings experts share their top tips to spend less on groceries, regardless of where you shop.

Scrutinize sales. Generic brands can be 10% to 30% cheaper than their “premium” counterparts and just as good — but that’s not always the case. Name brands may be offering bigger than usual discounts right now to maintain loyalty, so it’s important to price check.
Plan your meals. When you plan your meals in advance, you’re more likely to just buy the things you need, said Lisa Thompson, a savings expert at Coupons.com. If planning’s not your thing, at least go shopping with a rough idea of what you’ll be cooking in the week ahead to help stay on track and avoid impulse purchases, she added.
Buy in bulk. When it comes to the rest of the items on your list, you can save more by buying in bulk. Joining a wholesale club such as Costco, Sam’s Club or BJ’s will often get you the best price per unit on condiments and nonperishable goods. Then, keep your pantry organized, with food closer to expiration in front so you know to cook or consume them before they go bad, advised consumer savings expert Andrea Woroch.
Use a cash-back app. Ibotta and Checkout 51 are two of the most popular apps for earning cash back at the store, according to Ramhold. The average Ibotta user earns between $10 and $20 a month, but more active users can make as much as $100 to $300 a month, a spokesperson told CNBC.
Pay with the right card. While a generic cash-back card such as the Citi Double Cash Card can earn you 2%, there are specific grocery rewards cards that can earn you up to 6% back at supermarkets nationwide, such as the Blue Cash Preferred Card from American Express. CNBC’s Select has a full roundup of the best cards for food shopping along with the APRs and annual fees.

Subscribe to CNBC on YouTube.

WATCH LIVEWATCH IN THE APP More

The share of borrowers who are 60 or more days behind in their auto loan payments was 26.7% higher in December than it was a year earlier.
Once your payment is 30 days late, lenders report the delinquency to the credit-reporting firms, and your credit score will take a hit.
If you are having trouble paying on time, here are some things you can do to prevent the situation from getting worse.

Fotostorm | E+ | Getty Images

For a rising share of car owners, monthly auto loan payments appear to be evolving into a problem.
While borrowers who are behind on their payments by more than 60 days represent a tiny portion of all outstanding auto loans — 1.84% — their ranks are growing, according to a recent report from Cox Automotive. The share was 26.7% higher in December than the year-earlier month and is largely concentrated among borrowers with low credit scores.

“The danger of struggling to pay an auto loan is not just risking your car getting repossessed, it’s the long-term impact on all of the other areas of your finances,” said certified financial planner Angela Dorsey, founder of Dorsey Wealth Management in Torrance, California.

High prices, interest rates have led to bigger payments

A combination of market factors have pushed up monthly loan payments. And as personal savings have dwindled and persistent inflation has squeezed household budgets, keeping up with payments may become even more challenging.
The average price paid for a new car reached a record $47,362 in December, according to an estimate from J.D. Power and LMC Automotive. 
Monthly payments in the fourth quarter averaged $717, compared with $659 a year earlier, according to Edmunds. The share of buyers who took on monthly payments of $1,000 or more reached 15.7%, compared with 10.5% a year earlier. In the fourth quarter of 2020, just 6% of borrowers had monthly auto payments that large.
More from Personal Finance:How to protect yourself from tax fraud and scamsWhat the Fed’s interest rate hike means for youStates are holding $70 billion in unclaimed assets

Rising interest rates also have affected affordability. The average rate paid on a new car loan was 6.5% at the end of 2022, Edmunds data shows. For used cars, the average was 10%. A year earlier, those rates were 4.1% and 7.4%, respectively. 

Loan delinquencies can harm your credit score

While the auto loan delinquency rate is edging higher, the default rate is not, according to Cox. Entering default — when your lender determines you are not going to pay, usually some time after 90 days of no payments — can translate into your car being repossessed.
Yet even being too late on one payment has a negative effect on your financial life, and it can be long-lasting.
“If you’re 30 days late, it impacts your credit score,” said Brian Moody, executive editor of Kelley Blue Book.

That’s when lenders typically report the late payment to credit-reporting firms Equifax, Experian and TransUnion.
Also, you should be aware that because your payment history is the most influential factor in your credit score — it typically accounts for 35% of it — you could see a drop of 100 points due to being 30 days late with a payment, according to NerdWallet. The longer the loan goes unpaid, the bigger the hit to your score, and that delinquency can remain on your credit report for up to seven years.
As consumers generally know, the lower your score, the more likely you are to pay higher interest rates on new loans or credit you get. Additionally, a poor score or poor credit history may cause you to pay higher premiums on auto or homeowner’s insurance and affect your ability to rent an apartment or even get a job. Employers can’t see your score, but they can check your report.

What to do if you’re struggling with auto loan bills

For car owners who are pretty sure they’re heading toward delinquency, it’s important to try preventing the problem from snowballing.
“If you sense this is coming, be on top of it,” Moody said. “Don’t do nothing. It won’t get better on its own.”
If you’re struggling to keep up because you don’t budget well, that’s at least potentially fixable, experts say. In that case, take a hard look at how you’re spending money.

“Take a look at your overall expenses for the last few months,” said Joe Pendergast, vice president of consumer lending for Navy Federal Credit Union. “You would be amazed how much the average person spends each month without realizing it.”
However, if the payments are simply not manageable, the first thing you should do is bring your lender into the loop.
“If a consumer is struggling to make their car payments, or anticipates challenges ahead, they should reach out to their financial institution as soon as possible,” Pendergast said.

The sooner your bank or credit union is made aware, the easier it is to come up with possible solutions.

Joe Pendergast
Vice president of consumer lending for Navy Federal Credit Union

“The sooner your bank or credit union is made aware, the easier it is to come up with possible solutions,” he said.
While the options vary from lender to lender, you may be able to get a deferment — i.e., a few months without a payment — or a new loan that lowers the payments by stretching out the length. Either way, be aware that this generally would lead to paying more in interest, noted Moody of Kelley Blue Book.
However, a deferment would at least give you time to figure out how to best manage your situation, he said. 

For example, you could sell your car with the intent of buying a lower-priced one — or, perhaps, even going without one if you have other transportation options. Just be aware that depending on how much you owe on the loan, the price you get for your car may not fully cover your balance, which would mean you’d still owe the lender money.
There may be a similar value gap if you opt to trade it in. While trade-in amounts have been relatively high due to used-car values being elevated, that is changing. The latest inflation reading showed a year-over-year drop of 8.8% in used car prices.
And if the amount a dealer is willing to give you is less than what you owe on the loan, you will either need to pay off the remaining balance or roll it into your new loan. This so-called negative equity averaged $5,341 in the last quarter of 2022, Edmunds data shows.
“None of these [options] are ideal,” Moody said. “They are all under the heading ‘better than nothing.'”

WATCH LIVEWATCH IN THE APP More

The January jobs report issued by the Bureau of Labor Statistics showed strong job growth that handily beat expectations.
Other labor market data issued this week — the Employment Cost Index and the Job Openings and Labor Turnover Survey — also showed a hot job market defying recession fears.
Overall, wage and job growth are strong, layoffs are low, and workers are showing confidence in job prospects.
However, the Federal Reserve is raising interest rates and trying to cool the labor market.

Thomas Barwick | Digitalvision | Getty Images

1. Unemployment is at historic lows

The unemployment rate fell to 3.4% in January — the lowest since May 1969. Put another way: The last time the jobless rate was this low, Neil Armstrong hadn’t yet walked on the moon, Bunker said.
In fact, you’d have to go back to October 1953 to find a lower unemployment rate — 3.1%.

The unemployment rate is a single-best labor market indicator for the average American — it offers a holistic look at its strength or weakness and a reliable gauge for potential recession, said Daniel Zhao, lead economist at Glassdoor, a career site.

“The job market is still strong, and workers have opportunities to go out and find a job that’s a better fit for them,” Zhao said.
U.S. employers added 517,000 new jobs in January, handily beating expectations. They added 4.8 million total jobs in 2022, more than twice the roughly 2.3 million average from 2015 to 2019, said Julia Pollak, chief economist at ZipRecruiter.

2. Layoffs are low despite Big Tech

Big technology firms — such as Amazon, Google, Meta and Microsoft — announced mass layoffs in recent weeks. Those job cuts, which affect tens of thousands of employees, prompted fears the carnage would spill over into other areas of the U.S. economy.
However, that doesn’t seem to be happening.
“The thing that strikes me the most about the labor market is there aren’t layoffs,” said Mark Zandi, chief economist at Moody’s Analytics.

The layoff rate has stayed below its pre-pandemic nadir for 22 straight months, according to Job Openings and Labor Turnover Survey data. Workers filed 183,000 new claims for unemployment insurance last week — well below the roughly 245,000 average from 2015 to 2019, according to Labor Department data.
“That is just knock-your-socks-off low,” Zandi said of unemployment claims.
Businesses are reluctant to lay off workers and the labor market is strong enough to rapidly absorb people who do lose their jobs, Zandi said.
Tech jobs also account for a small share of the U.S. workforce: about 4% of total employment in 2020, according to a Deloitte report published in 2021.

3. The ‘great resignation’ chugs along

Workers are still quitting their jobs in historically elevated numbers.
Most workers who quit do so for new jobs; they don’t leave the workforce altogether. Voluntary departures are therefore a proxy for worker confidence — they’re optimistic about their chances of finding a better job elsewhere, economists said.

About 4.1 million people quit in December, according to JOLTS data issued Wednesday.
That figure is a slight cooling from the peak of over 4.5 million in November 2021 — but still well above the pre-pandemic high bar of 3.6 million set in July 2019.
The elevated level of quitting in the pandemic era came to be known as the “great resignation.” In 2022, 50.5 million people quit their jobs — breaking an annual record set in 2021.

4. Hiring has moderated

Hiring remains strong but has been decelerating. The hiring rate and number of new hires have cooled since February 2022; they’re roughly on par with their level in February 2020.
That’s not necessarily a bad sign — the job market was also strong in the runup to the pandemic.
Businesses are adjusting to higher interest rates and the prospects of recession — not necessarily via mass layoffs but instead by hiring less aggressively, Zandi said. Data suggests employers are allowing jobs vacated by quitting workers to go unfilled, he said.

5. Wage growth is high but cooling

Wages are growing at a historically fast pace — especially for those switching jobs. But there’s a cooling trend here, too.
Wages and salaries for private-sector workers grew about 4% in the fourth quarter of 2022, on an annualized basis — above the pre-pandemic pace but down from 6% at the end of 2021, Bunker said. He analyzed Employment Cost Index data issued Tuesday and excluded incentive-paid occupations, which can be volatile.
“The slowdown is definitively here,” Bunker said of wage growth.
Average hourly earnings in January cooled to a 4.4% annual growth rate, according to Friday’s jobs report, falling from 4.6% in December and 5.1% in November.
“It may not be as easy today as it was a year ago to find a higher-paying job,” Zhao said. “But there are still opportunities out there.”

6. The labor market is ‘out of balance’

This cooling in pay growth is by design. The Federal Reserve is aiming to reduce wage growth to what it sees as a more sustainable level — one that doesn’t fuel high inflation.
Fed Chairman Jerome Powell on Wednesday said the labor market was “very, very strong” due to job creation and wages — but also noted that it was “out of balance.” Largely, that’s because labor demand among employers “substantially exceeds” the supply of available workers, Powell said, which has underpinned fast-rising wages.
The Fed is trying to soften the labor market without triggering a recession — a so-called “soft landing.”
Reducing wage growth to 3.5%, as measured by the Employment Cost Index, would be consistent with the Fed’s long-term 2% inflation target, Zandi said.

WATCH LIVEWATCH IN THE APP More

Some new beneficiaries have faced months-long delays in coverage when they signed up for Medicare, depending on their situation.
Generally speaking, those gaps are eliminated, although there may still be late penalties involved in certain instances.
It may now also be possible to sign up outside of set enrollment periods if the reason you didn’t enroll was due to “exceptional circumstances.”

Shapecharge | E+ | Getty Images

As of this year, people new to Medicare won’t face big delays in coverage — an unenviable situation that some beneficiaries used to find themselves in.
Thanks to legislation passed in late 2020, months-long delays in certain Medicare enrollment circumstances are now eliminated. Additionally, individuals who missed signing up when they were supposed to due to “exceptional circumstances” may qualify for a special enrollment period.

“It’s really about having access to pretty essential health services,” said Casey Schwarz, senior counsel for education and federal policy at the Medicare Rights Center.
More from Personal Finance:3 key things to know about home equity lines of creditU.S. credit card debt hits a record $930.6 billionIRS more likely to audit Black Americans, study finds
Delays in coverage meant possibly facing a gap in health insurance — which in turn could have translated into either being unable to get needed care due to financial constraints or paying out of pocket for care, whether planned or an emergency.

Signup rules for Medicare can be tricky

Medicare’s enrollment rules can be confusing. People who are already receiving Social Security benefits before the reach age 65 — which is when you become eligible for Medicare — are automatically enrolled in Part A (hospital coverage) and Part B (outpatient care coverage).
Otherwise, you are required to sign up during your “initial enrollment period” when you hit age 65 unless you meet an exception, such as having qualifying health insurance through a large employer (20 or more workers).

Initial enrollment period gap is eliminated

Your initial enrollment period starts three months before your 65th birthday and ends three months after it (seven months total). The new rule makes it so coverage takes effect the month after you sign up if you do so in the latter part of that enrollment window. In the past, some beneficiaries waited up to three months for coverage to take effect.
If you enroll before the month you turn 65, coverage starts the first of your birthday month (that hasn’t changed).

Penalties may still apply for some late enrollment

If you miss your initial enrollment period and don’t qualify for a special enrollment period, you generally can only sign up during the first three months of the year during a “general enrollment period.”
Going that route also has meant waiting until July 1 for coverage to take effect. Starting this year, it will be effective the month after you sign up.

However, in that situation, there may still be a late-enrollment penalty. For Part B, it’s 10% of the standard premium ($164.90 for 2023) for each 12-month period you should have been enrolled but were not.
Part D also comes with a late-enrollment fee. It’s 1% of the “national base premium” — $32.74 in 2023 — multiplied by the number of months that you went without Part D since your enrollment period (if you didn’t have qualifying coverage in place of it). 
In both cases, late-enrollment penalties are generally life-lasting.

‘Exceptional’ situations may result in special enrollment

Starting this year, individuals may be able to sign up outside of current enrollment periods if they have “exceptional circumstances.” This is already a flexibility available with Part D, as well as Medicare Advantage Plans (which deliver Parts A and B and usually D), Schwarz said.
“It’s really designed to provide relief for people who are impacted by exceptional situations and need access to health insurance,” she said.
Additionally, beneficiaries who qualify for the special enrollment period will not face Part B late enrollment penalties.

There are situations where … people make mistakes. So these rules allow some flexibility.

Casey Schwarz
Senior counsel for education and federal policy at the Medicare Rights Center

Until this rule change, the only way to qualify was if a government official provided bad information or made a mistake that caused you not to enroll.
“There are situations where … people make mistakes,” Schwarz said. “So these rules allow some flexibility.”
Some qualifying circumstances could include an employer providing inaccurate information about Medicare enrollment, or they were in a situation where it was impossible or impractical to enroll, such as being in a natural disaster or incarcerated.

WATCH LIVEWATCH IN THE APP More

The Supreme Court is set to hear arguments over President Joe Biden’s student loan forgiveness plan in late February.
Federal student loan payments won’t resume until the end of August, unless the litigation over the Biden administration’s student loan forgiveness plan is resolved sooner.
Here’s what borrowers need to know about the ongoing payment pause.

Littlebee80 | Istock | Getty Images

It’s been nearly three years since most people with federal student loans have had to make a payment on their education debt.
The U.S. Department of Education has repeatedly cited specific dates for when the bills would resume, only to extend the pandemic-era break yet again.

Most recently, amid legal challenges to the Biden administration’s student loan forgiveness plan, the government told borrowers they’d get even more time. But the timing it gave wasn’t as straightforward as it was with previous extensions.
Here’s what borrowers need to know.

Student debt bills may not resume for months

In August 2022, President Joe Biden promised to cancel up to $20,000 of student loan debt for tens of millions of Americans, but Republicans and conservatives quickly filed a number of lawsuits against his plan, forcing the administration to close its application portal in early November.
As a result of those challenges, the Education Department announced another extension of the repayment pause in late November.
It said federal student loan bills will be due again 60 days after the litigation over its student loan forgiveness plan resolves and it’s able to start wiping out the debt. But the Department added that if the Biden administration is still defending its policy in the courts by the end of June, or if it’s unable to move forward with forgiving student debt by then, the payments will pick up at the end of August.

More from Personal Finance:64% of Americans are living paycheck to paycheckWhat is a ‘rolling recession’ and how does it impact you?Almost half of Americans think we’re already in a recession
The Supreme Court will begin to hear oral arguments over Biden’s plan at the end of February.
When payments could resume depends in part on when the justices reach their decision, said higher education expert Mark Kantrowitz.
“If the court issues a ruling a few weeks after the Feb. 28 hearing, repayment could restart in May or June,” Kantrowitz said. “If they wait until the end of the term, when they go on recess, in June or July, then there would be an August or September restart.”

Another payment pause extension is possible

It’s a time of uncertainty for the federal student loan system.
With Biden’s forgiveness plan up in the air, borrowers may be unsure what they owe. Throughout the pandemic, there have been a lot of changes to the companies that service federal student loans. And then there’s the fact that after three years without payments, millions of Americans have simply become accustomed to life without student debt bills.
“These student loan borrowers had the reasonable expectation and belief that they would not have to make additional payments on their federal student loans,” Education Department Undersecretary James Kvaal said in a November court filing. “This belief may well stop them from making payments even if the Department is prevented from effectuating debt relief.
“Unless the Department is allowed to provide one-time student loan debt relief,” he went on, “we expect this group of borrowers to have higher loan default rates due to the ongoing confusion about what they owe.”
Considering that the U.S. Department of Education has already extended the payment pause roughly eight times, it’s possible borrowers could get more time still, Kantrowitz said.
“There will always be an excuse if they want a reason for another extension,” he said. “The most likely reasons could include a new worrisome Covid-19 mutation or economic distress.”

For now, collection activity still on pause

The U.S. government has extraordinary collection powers on federal debts and it can seize borrowers’ tax refunds, wages and Social Security checks if they fall behind on their student loans.
During the extended payment pause, however, the Education Department also says it won’t resume collection activity.
Borrowers in default on their student loans should also look into the recently announced “Fresh Start” initiative, in which they’ll have the opportunity to return to a current status.

Make the most of extra cash during the ongoing break

With headlines warning of a possible recession and layoffs picking up in some sectors, experts recommend that borrowers try to salt away the money they’d usually put toward their student debt each month.
Certain banks and online savings accounts have been upping their interest rates, and it’s worth looking around for the best deal available. Consumers will just want to make sure any account they put their savings in is insured by the Federal Deposit Insurance Corp., meaning up to $250,000 of the deposit is protected from loss.
And while interest rates on federal student loans are at zero, it’s also a good time to make progress paying down more expensive debt, experts say.
The average interest rate on credit cards is currently more than 20%.

WATCH LIVEWATCH IN THE APP More

Total credit card debt reached a record $930.6 billion in the fourth quarter of 2022, according to the latest credit report from TransUnion.
As balance rise, so have delinquencies, which is “something to watch,” says TransUnion’s Michele Raneri.

For most Americans, inflation and rising interest rates are a one-two punch.
On the heels of another rate hike this week by the Federal Reserve, credit card annual percentage rates are already near 20%, on average, and set to climb even higher. At the same time, more consumers are leaning on credit to afford increasingly expensive necessities, like food and rent.

That helped propel total credit card debt to a record $930.6 billion at the end of 2022, a 18.5% spike from a year earlier, according to the latest quarterly report by TransUnion.
The average balance rose to $5,805 over that same period, TransUnion found.
At nearly 20%, if you made minimum payments toward this average credit card balance, it would take you more than 17 years to pay off the debt and cost you more than $8,213 in interest, Bankrate calculated.

“Whether it’s shopping for a new car or buying eggs in the grocery store, consumers continue to be impacted in ways big and small by both high inflation and the interest rate hikes implemented by the Federal Reserve,” said Michele Raneri, vice president of U.S. research and consulting at TransUnion.
Overall, an additional 202 million new credit accounts were opened in the fourth quarter, led by originations among Generation Z, or adults ages 18 to 25, and the tally of total credit cards hit a record 518.4 million.

More from Personal Finance:64% of Americans are living paycheck to paycheckWhat is a ‘rolling recession’ and how does it impact you?Almost half of Americans think we’re already in a recession
As the number of credit card accounts in the U.S. rises, more new customers are subprime borrowers, generally meaning those with a credit score of 600 or below, according to TransUnion, in part because of the flood of younger borrowers gaining access to credit cards. 
But at the same time, delinquencies rose as lenders expand access to less-experienced credit users, the report found. TransUnion defines a delinquency as a payment that’s 60 days or more overdue.
“The increase in delinquencies is something to watch,” Raneri said. As long as unemployment stays down, households are better able to pay their bills, she noted. “If unemployment goes up, and we see a spike in delinquencies, then that indicates a longer-term problem.”
For now, the unemployment rate is at a 53-year low, after a better-than-expected January jobs report.

How to tackle high-interest credit card debt

“Cardholders do have options, though,” said Matt Schulz, chief credit analyst at LendingTree. Zero percent balance transfer credit card offers are even more plentiful than they were a year ago and remain one of the best weapons Americans have in the battle against credit card debt, he said.
Borrowers may also be able to refinance into a lower-interest personal loan. Those rates have climbed recently, as well, but at 10%, on average, are still well below what you currently have on your credit card, according to Schulz.
Otherwise, go back to the basics, advised Ted Rossman, senior industry analyst at Bankrate.
“Take on a side hustle, sell stuff you don’t need, cut your expenses,” he said. “A dollar saved is a dollar earned, and every dollar of credit card debt that you pay down has an average guaranteed, tax-free return of about 20%.”
Subscribe to CNBC on YouTube.

WATCH LIVEWATCH IN THE APP More

This week marks the 30th anniversary of the Family and Medical Leave Act, which lets qualifying workers take unpaid time off to care for loved ones or recover from their own health issues.
Democrats are introducing legislation to address gaps in the law’s coverage, with the ultimate goal of putting a national paid leave policy in place.

Jose Luis Pelaez Inc | DigitalVision | Getty Images

As Democratic lawmakers honor the anniversary of a national family and medical program for workers, they are calling for a national paid policy that would bring the U.S. in line with other industrialized nations.
This Sunday, Feb. 5, marks the 30th anniversary of the Family and Medical Leave Act, legislation that lets workers who qualify take unpaid time off from their jobs to care for loved ones or recover from their own illnesses or health conditions.

The FMLA was signed into law by former President Bill Clinton in 1993. Since then, it has allowed workers to be with their families when a child was born or when relatives were sick, Clinton said at a White House event Thursday.
“There are still a lot of problems that can’t be solved without some form of paid leave,” Clinton said.
More from Personal Finance:U.S. unemployment system still plagued by delaysDespite layoffs, tech jobs are still hot in 2023Long Covid has an ‘underappreciated’ role in labor shortage
The anniversary comes as Democrats passed a paid leave proposal in the House in 2021. Yet those changes failed to make it into a broader legislative package.
About 56% of workers have access to unpaid leave under the Family and Medical Leave Act, according to research from the Urban Institute.

Workers who are excluded include those who have been at a work site for less than a year, those whose work sites have fewer than 50 employees within a 75-mile radius and those who worked less than 1,250 hours at their employer in the past year.
“People need to understand that as great as this was, there are still a lot of people left out,” Clinton said.

‘We need paid leave’

Juggling personal responsibilities and work can lead to tough trade-offs.
Workers missed out on approximately $28 billion more in wages from March 2020 to February 2022 compared with the previous two years due to a lack of access to paid leave, research from the Urban Institute has found.
About 5 million women lost their jobs during the Covid pandemic, Sen. Kirsten Gillibrand, D-N.Y., noted during a Wednesday news conference. Had a federal paid leave policy been in place, many of those women may have been able to stay employed, she said.
“Imagine if, during the pandemic, we had had a national paid leave program,” Gillibrand said.

We need to make sure we’re covering these front-line workers who are taking care of our children.

Sen. Tammy Duckworth
Democrat of IIlinois

“It would have changed everything,” she added. “We would have been able to have an economy that continued to thrive.”
Sen. Tammy Duckworth, D-Ill., said the gaps in protection under FMLA policy affected her family personally when she was injured while serving in the military in Iraq.
Duckworth’s husband was able to care for her by taking unpaid time off, but it cost him his contract job as a military science professor.
“As soon as his FMLA ran out, which was unpaid, they were like, ‘Thank you, you don’t need to come back,'” Duckworth said.

Sen. Tammy Duckworth, D-Ill., and Ukrainian soldier Oleksandr Chaika demonstrate their prosthetic legs. Chaika lost his leg by amputation due to a tank shell explosion in Ukraine. Duckworth lost her legs when her helicopter was shot down in Iraq.
Tom Williams | Cq-roll Call, Inc. | Getty Images

“This is how cutthroat it is out there,” she added. “We need paid leave.”
Democrats reintroduced bills on Wednesday aiming to make paid leave a federal policy, while also expanding protections to more workers under the FMLA.
The Family and Medical Insurance Leave Act, or FAMILY Act, was reintroduced by lawmakers including Gillibrand and Rep. Rosa DeLauro, D-Conn., with the goal of creating the first paid national family and medical leave program.
The U.S. is the only industrialized nation without a paid family and medical leave policy, the lawmakers noted.
The FAMILY Act proposal calls for 12 weeks’ paid leave. It would include all types of life events and cover all caregivers, including those who are not members of an immediate family unit, Gillibrand said.

“It is a reasonable, pragmatic way to get to paid family leave,” Duckworth, who is a co-sponsor of the bill, told CNBC.com in an interview.
The plan would let both employers and employees pay into an insurance program, which would cost about $2 per week, Duckworth said. Workers would be able to take up to 80% of their salary while taking care of a family member or taking time for a personal illness.
Alongside Rep. Sean Casten, D-Ill., Duckworth also reintroduced another bill, the ESP and School Support Staff Family Leave Act, which would provide education support professionals with unpaid leave under the FMLA.
Covered workers would include school bus drivers, cafeteria workers, nurses and administrative staff who do not meet the hourly work requirements during the school year in order to qualify for FMLA coverage.

The Education Support Professionals Family Leave Act would provide education support workers such as school bus drivers with unpaid leave under FMLA.
Marilyn Nieves | Moment | Getty Images

“People don’t realize that the school nurse who’s checking your children for Covid, she does not get FMLA,” Duckworth said. “We need to make sure we’re covering these front-line workers who are taking care of our children.”
Separately, Sen. Tina Smith, D-Minn., and Rep. Lauren Underwood, D-Ill., proposed the Job Protection Act, which would expand FMLA protections to workers who have changed jobs or are returning to the workforce, work part time or are employed by smaller employers.

State plans may influence support

Duckworth said she hopes her bill passes this year, while also pointing to the need for a federal paid leave program.
“Having gone through the pandemic, people realize how important it is to have paid family leave,” Duckworth said. “We need it to be competitive on a global scale.”
Part of the opposition to enhancing paid leave policies has come from businesses that fear it will lead to higher costs.
About 11 states and Washington, D.C., have enacted their own paid family and medical leave policies.
“As different state plans pop up, it may generate additional support for paid leave at the federal level and for a more uniform solution for all workers,” said Chantel Boyens, principal policy associate at the Urban Institute’s Income and Benefits Policy Center.
A national policy would likely help low-wage workers, who tend to be most affected by gaps in the current federal policies, she noted.
“One of the potential benefits of a national policy is you have something that applies to all workers,” Boyens said.

WATCH LIVEWATCH IN THE APP More