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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.

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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%.”
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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.
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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.

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Challenges to President Joe Biden’s student loan debt relief plan are set to be heard by the U.S. Supreme Court.
Republicans and conservative groups have now brought at least six lawsuits against Biden’s plan.
Arguments against the plan hinge on claims the federal government is overstepping its authority and harming some people financially.

Douglas Rissing | Istock | Getty Images

Plan ‘vastly exceeds’ Heroes Act authority

The six states — Nebraska, Missouri, Arkansas, Iowa, Kansas and South Carolina — argue in their brief that the Biden administration has overstepped its authority by moving to cancel up to $20,000 in student debt for tens of millions of Americans without Congress’ authorization.
The Biden administration insists that it’s acting within the law, pointing out that the Heroes Act of 2003 grants the U.S. secretary of Education the authority to make changes to the federal student loan system during national emergencies (the U.S. has been operating under an emergency declaration since March 2020 because of the Covid pandemic). The law is a product of the 9/11 terrorist attacks, and an earlier version of it provided relief to federal student loan borrowers impacted by the attacks.

However, the states counter that the Heroes Act allows the Education secretary only to modify the federal student loan system to keep certain borrowers from being in a worse-off position with their loans because of a national emergency.

They go on to say, in their brief, that the president’s plan “places an estimated 43 million Americans in a better position by eliminating all loan balances for 20 million and erasing up to $20,000 for over 20 million more. This vastly exceeds the Secretary’s authority under the Act.”
In other words, higher education expert Mark Kantrowitz said, the states are asserting that Biden is using Covid as an excuse to pass his plan.
“For example, if it was an emergency, why wait three years to provide the forgiveness?” he said. “Why present it in a political framework, as fulfilling a campaign promise?”
The states also argue that Biden’s plan would cause financial harm to their states, including a loss of profits for the companies that service federal student loans.

Borrowers deprived of ‘procedural rights’

Boonchai Wedmakawand | Moment | Getty Images

The second legal challenge the Supreme Court will consider was backed by the Job Creators Network Foundation, a conservative advocacy organization.
In its brief, the lawyers argue that two plaintiffs, Myra Brown and Alexander Taylor, were deprived of their “procedural rights” by the Biden administration because it didn’t allow the public to formally weigh in on the shape of its student loan forgiveness plan before it rolled it out. As a result, the lawyers argue, Brown and Taylor are either partially or fully excluded from the relief.
The Heroes Act exempts the need for a notice-and-comment period during national emergencies, but, like the states, the plaintiffs in this challenge also argue that that law doesn’t authorize the president’s sweeping plan.

How White House defends loan forgiveness

In its arguments to the highest court submitted last month, lawyers for the Education Department and U.S. Department of Justice argued that the challenges to the plan were brought by parties that failed to show harm from the policy, which is typically a requirement to establish so-called legal standing.
The attorneys also denied the claim that the Biden administration was overstepping its authority, laying out the White House’s argument that it is acting within the law under the Heroes Act of 2003.

“We remain confident in our legal authority to adopt this program that will ensure the financial harms caused by the pandemic don’t drive borrowers into delinquency and default,” U.S. Secretary of Education Miguel Cardona said in a statement.
The Supreme Court will begin to hear the cases on Feb. 28.

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Smart Tax Planning

Last year, there were close to 8 million reports of suspicious activity related to income tax filing and identity theft.
More than 90% of tax returns were filed online last year and phone, email and text scams always increase during tax season.
There are several important cybersecurity steps filers should take in advance of using tax prep software or working with an accountant, who are also targets of scammers.

Constantine Johnny | Moment | Getty Images

Tax season has begun, and it typically comes with a big uptick in tax-related scams.
There were nearly 7.8 million reports of suspicious activities in 2022, according to a recent report from the Identity Theft Tax Refund Fraud Information Sharing Mission & Analysis Center, a partnership between the IRS, companies and states.

The tax scamming is taking place during an environment of rising fraud across the nation. U.S. consumers lost more than $5.8 billion to fraud in 2021, a 70% increase from the year before, according to the Federal Trade Commission.  
With online filing now the norm — the IRS said 92% of tax returns last year were filed electronically — cybersecurity is more important now than ever.

More from Smart Tax Planning:

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

Popular tax filing platforms such as TurboTax, H&R Block and TaxAct invest in security and have to follow regulatory requirements around it. The big tax prep companies in the U.S. have to go through a compliance and audit process to be able to store data, said Nicholas Donarski, chief technology officer and co-founder of blockchain technology firm ORE System. He added this should lead tax filers to make sure they pick a reputable tax platform, and “not just the cheapest one.”
But just because tax filing platforms implement security measures doesn’t mean its users are off the hook when it comes to personal cybersecurity best practices.
“The biggest issue isn’t so much on the security program of providers as it is we humans as users of those platforms,” said Lisa Paggemier, executive director at the National Cybersecurity Alliance.

Here are steps consumers can take to protect themselves.

Use secure passwords and multi-factor authentication

Despite all the warnings about using secure passwords (tip: don’t use the name of a pet) and using different passwords for every website, few people actually do this.
Cybersecurity experts suggest using a password manager that stores account credentials. Despite recent headlines about some big password managers having their customer data hacked, using such an application is “still the most secure, so long as you secure that as well with multi-factor authentication,” Paggemier said.
Multi-factor authentication requires users to prove their identity in two ways, usually through a password as well as a one-time code sent to their phone or email, or a fingerprint. While TurboTax, TaxAct and H&R Block all offer multi-factor authentication and advise users to layer on this added cyber protection, it’s not required.
“This is an important step to help secure your online account from identity thieves,” said Kathy Pickering, chief tax officer at H&R Block. “Providing your mobile phone to do this is better than providing your email because it’s more secure and may be faster.”

File taxes promptly, before someone impersonates you

It’s understandable to procrastinate when faced with a dreaded task like filing taxes, but Paggemier said being prompt can help ward off potential fraud. The sooner you file, the “less time you give the bad guy to file on your behalf,” she said.
Tax filing fraud is similar to the many unemployment scams during the pandemic when scammers filed in other people’s names to steal benefits. With tax returns, scammers file a false return with fraudulent data and collect the refund. 
TaxAct has built in an extra layer of security into its platform around Social Security numbers, which will notify users in case someone has already entered the same number. It also flags mistakes that legitimate users make when entering their Social Security number.
“It helps to either identify typos in your SSN that could delay your refund or alert you to possible preexisting identity theft,” said Mark Jaeger, vice president of tax development at TaxAct.
TaxAct said its platform will notify customers in case another return was filed using the same Social Security number, even if the initial filing was through a different software provider. 
Another layer of protection is to get an identity protection PIN, which prevents someone else from filing a tax return using your Social Security number or individual taxpayer identification number. 
The IRS sends a new IP PIN to victims of tax-related theft every year. This year, the agency has opened up the process, allowing anyone with a Social Security number or individual taxpayer identification number who can verify their identity to enroll in the program by filling out an application online.

Be alert for scam emails, texts and calls

Scam emails and texts occur year-round but tend to accelerate during tax season. Scammers may pose as IRS agents, tax preparation companies and other parties, the IRS has warned. 
“You see an increase in the number of attacks … they use that emotional response, that fear that we call it in the industry FUD — fear, uncertainty and doubt,” Donarski said.
One twist this year: the arrival of ChatGPT, which could make scam messages harder to detect. Poor spelling or grammar and funky fonts or graphics have been common giveaways in past years, but the use of artificial intelligence like ChatGPT can change that factor.
Cybersecurity experts said the advice is still the same to ward off fraudsters: Don’t click on any links. If there’s any doubt, go to a site you know to be legit to check your tax filing, bank or credit card account, or call the official number listed on the back of a card or the official website.

You have to be your own champion when it comes to your privacy and your security.

Nicholas Donarski
chief technology officer and co-founder of ORE System

Keatron Evans, principal cybersecurity advisor at Infosec, noted a recent increase in scam calls claiming to be from a tax provider, alerting victims that they’ve noticed a problem and should go to a website to download a plug-in. “People are now desensitized … so they feel like if they’re talking to a person, telling them to go click on a URL or something like that it’s probably more legit, when it absolutely is not.”
Phone scammers also frequently impersonate IRS agents, scaring victims by demanding immediate payment using prepaid debit cards, gift cards or wire transfer and threatening to bring in local police. The IRS has issued warnings about this scam and recommends that victims report it to the Treasury Department’s Inspector General using an online form or calling the agency, or reporting it to the IRS by email with “IRS Phone Scam” in the subject line.

Install tax prep software updates

Just as tax prep platforms need to ensure the security of data while in transit and when storing it, users should too by securing their home network and computer. Computers running on old software are more vulnerable to attacks.
“A lot of times, these software are vulnerable to attack and exploitation because bad guys know that at this time of year people are going to have these things installed on their computers. So they target them for vulnerabilities,” Evans said. To minimize this risk, install software updates for tax prep software or plug-ins as soon as they are available. That also goes for other software updates, such as the operating system or browser.
Secure Wi-Fi passwords can also help ensure security of the home network, in addition to making sure antivirus software is installed and up to date. For anyone who needs to use a public network for their taxes or any other sensitive information, cybersecurity experts advise using a virtual private network, or VPN.

Vet your accountant’s cybersecurity practices

Not all electronic tax filings are done through well-known tax platforms, with many filers working with accountants or accounting firms. Increasingly, tax professionals are also targeted by scammers. Cybersecurity experts said you should ask some questions about how the accountant is storing and backing up data, how they are securing it or encrypting the data, and how the office is secured.
“If you’re dropping tax documents into Google Docs or Google Drive or something like that, I would probably question where the storage is,” Donarski said since these files are not encrypted.
Accountants and accounting firms should be asking clients to upload to a secure platform or to use something like an Adobe- or Microsoft-encrypted file-transfer system. And with home offices more common, don’t hesitate to ask tax preparers about how they’re securing their home Wi-Fi network or if they use a VPN.
“You have to be your own champion when it comes to your privacy and your security,” Donarski said. More

Gautam Adani, one of the world’s richest men, withdrew Adani Enterprises’ $2.5 billion share offering.
Shares of Adani Enterprise were routed, falling 28% on Wednesday.

A signage of Adani group is pictured outside the Chatrapati Shivaji Mumbai International Airport in Mumbai on July 28, 2021. (Photo by Indranil MUKHERJEE / AFP) (Photo by INDRANIL MUKHERJEE/AFP via Getty Images)
Indranil Mukherjee | Afp | Getty Images

On Wednesday, Gautam Adani announced he’s scrapping his flagship firm’s $2.5 billion equity sale.
He withdrew Adani Enterprises’ offering after the company’s share price tanked by nearly 30%.

Breaking his silence to the media, Adani said, “Today the market has been unprecedented, and our stock price has fluctuated over the course of the day. Given these extraordinary circumstances, the Company’s board felt that going ahead with the issue will not be morally correct.”
In a Jan. 24 report, short seller Hindenburg Research alleged that “Adani Group has engaged in a brazen stock manipulation and accounting fraud scheme.” The report went on to raise concerns around the debt and valuations of seven Adani companies.
Speculation is growing that the Securities and Exchange Board of India (SEBI) will conduct some type of investigation into Adani’s businesses.
“My understanding is that a cancellation would mean a mandatory SEBI inquiry,” said Pramit Chaudhuri, Eurasia Group’s head of South Asia practice to CNBC.
Chaudhuri, like many, said he was “surprised” to see Adani scrap plans after achieving the $2.5 billion target.

The stunning reversal caps a week in which Adani went on a full mission to ensure his equity sale was successful following immense pressure tied to his falling stock price.
Adani tapped high-net worth individuals inside India and looked to the Middle East as well. International Holding Co., an Abu Dhabi-based conglomerate, contributed $400 million to the deal. It was widely seen as a vote of confidence. Goldman’s trading desk participated in the deal as well, a source familiar with the matter told CNBC. Adani Enterprises’ stock ended higher on Tuesday following news of the fully subscribed $2.5 billion offering.
Investors woke up to an ugly picture on Wednesday when Adani Enterprise’s stock plunged, falling by as much as 28% and prompting Adani to cancel his equity sale.
“We are working with our Book Running Lead Managers (BRLMs) to refund the proceeds received by us in escrow and to also release the amounts blocked in your bank accounts for subscription to this issue,” added Adani.
The move also raises questions about where else Adani will look for financial support.
As CNBC reported, Adani has established relationships with a slate of international banks and private equity investors. The tycoon, once the second richest person in the world, has slipped to the 13th position in the Bloomberg Billionaires Index as of Feb. 1.

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About 1 in 7 people have unclaimed property being held by a state.
The average value of each asset that ends up being claimed is $2,080, although that ranges from a couple of pennies to more than $1 million.
Here’s how to check if a state is holding an asset that belongs to you.

Simpleimages | Moment | Getty Images

How to check if you have unclaimed property

Each year on Feb. 1, the group holds “Unclaimed Property Day,” when it encourages people to check missingmoney.com — a national clearinghouse for unclaimed assets that most states participate in — or an individual state’s unclaimed property website. It’s worth doing a national search as well as conducting individual state searches based on where you have lived, even briefly.

The association, which is an affiliate of the National Association of State Treasurers, also offers links to state programs. States do not charge a fee to search their database nor to claim your property.
So how does property end up with the government? If a company, bank or other entity can’t find you after a certain amount of time — generally three to five years, Murante said — the asset is turned over to the state.

While each state has its own rules that govern the process of claiming the property, you can count on being required to prove that you are the rightful owner by, for example, providing documents confirming your identity. States often try to locate people as well by, for instance, matching the owner’s information to a tax return.
Even if you search and discover you aren’t due anything, that shouldn’t dissuade you from regularly checking to see if that changes, Murante said.
“State treasurers get new unclaimed property turned over to them every single day,” he said.

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Home equity lines of credit, or HELOCs, may be more appealing than a cash-out mortgage refinance or other sources of borrowed money.
Last year, HELOC use ticked up as refinancing lost its luster due to quickly rising mortgage rates.
However, there are aspects of HELOCs that borrowers should consider before tapping their home equity.

HELOC use rose as cash-out refis dropped

Last year, as mortgage rates climbed higher, accessing home equity by taking cash against it during refinancing — a so-called cash-out refi — became less appealing.
Rates on mortgages went from close to 3% at the beginning of 2022 to a peak of above 7% in the fall. Right now, the average on a 30-year fixed-rate mortgage is 6.21%, according to Mortgage News Daily.

As cash-out refis fell, HELOC use began to climb. Last year through September, lenders originated HELOCs totaling $214 billion, up from $159.5 billion during the same period in 2021, according to CoreLogic.

“In a low-rate environment, people were looking at cash-out refis,” Bellas said. “Now … a lot of people have a mortgage with a very low rate, so to do a cash-out refi, they’d be paying [a higher rate] on their full mortgage.”
“We’ve had quite a few people over the past 12 months … elect to go with the HELOC because of that,” Bellas said.

How HELOCs compare with other borrowing options

Generally, HELOCs come with low closing costs compared with mortgages or home equity loans, which operate like other fixed-rate loans, with a set length of time to pay back. And if you have good credit, the rate you can get may be lower than what you’d pay for a personal loan or credit card balance.
Right now, rates on HELOCs are 7.75%, according to Bankrate. That compares with personal loan rates of above 10%, for consumers with high credit scores, and about 20% for credit cards, according to CreditCards.com.

I would not use a HELOC to buy frivolous things or things you can’t afford.

David Demming
President of Demming Financial Services

However, like your mortgage, a HELOC is a lien against your house — meaning that if you don’t repay as promised, the lender would have the right to foreclose on your house.
“I would not use a HELOC to buy frivolous things or things you can’t afford,” said certified financial planner David Demming, president of Demming Financial Services in Aurora, Ohio.
“It should be a short-term bill that you’re going to pay off within a finite period of time,” Demming said.
Here are three key things to consider before signing on the dotted line.

1. Variable interest rates make it tricky to budget

The interest rate on HELOCs is typically variable, meaning it moves up and down based on the so-called prime rate, which banks use as a basis to set rates on a variety of loans. While the Federal Reserve doesn’t control the prime rate, the one it does influence — the overnight lending rate among banks — ends up following suit. 
“Because it’s variable, it can be tough to budget from month to month,” Bellas said.
Right now, the U.S. is in a rising rate environment, although that is expected to shift as time passes. The Fed’s rate-setting committee is meeting this week and is expected to raise that overnight lending rate by a quarter percentage point, which means the prime rate will generally tick higher — and so will HELOC rates.

2. It may be difficult to pay off the principal

HELOCs typically only come with monthly interest payments — meaning none of your minimum payment goes toward the principal.
“If you don’t have a lot of excess funds and are making interest-only payments, it can be difficult to find the cash and discipline to pay down that balance,” Bellas said.
“I’ve seen people with a $50,000 balance and five years later it’s still close to that [amount],” he said.

HELOCs generally have a “draw” period when you can take money out that often lasts 10 years and then a repayment period of, say, 10 or 20 years, when you start paying both interest and principal. And because of that, your payments will jump if you have only been paying interest.
For instance, a $50,000 balance would yield interest-only payments of $312.50 and then jump to $593.51 during a repayment period of 10 years, according to InvestorsBank.com’s HELOC calculator.
If your HELOC has a balance when you sell the home, it must be paid off along with the primary mortgage on the house.

3. Beware of transferring debt to a HELOC

Sometimes, homeowners turn to a HELOC to pay off higher-interest debt, such as credit card balances.
On the face of it, shifting high-rate balances to a HELOC could make sense. However, if you don’t have a plan to pay off the HELOC, you’re just delaying the inevitable, Bellas said.
“The danger is really that you’re recategorizing the debt and kicking it down the road,” Bellas said. “There’s probably a bigger thing that needs to be addressed.”

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BlackRock raised its holding in Silvergate Capital, a crypto-focused bank, according to a Jan. 31 filing with the Securities and Exchange Commission.
Silvergate shares jumped on Tuesday afternoon.
Crypto has enjoyed a solid rebound in January, but shares of Silvergate have had a rocky start to the year.

Cryptocurrencies have been under immense pressure after the collapse of a so-called stablecoin called terraUSD.
Umit Turhan Coskun | Nurphoto via Getty Images

Silvergate Capital jumped on Tuesday afternoon after BlackRock reported a 7% stake in the crypto bank. 
Shares of Silvergate rose 9.96% after a Jan. 31 filing with the Securities and Exchange Commission became public. BlackRock increased its holding in Silvergate to 7.2%, an increase from the 5.9% it previously reported, according to the filing. 

More than 70% of Silvergate Capital shares that are freely available to trade are sold short, according to FactSet data.
While cryptocurrencies and related stocks have enjoyed a strong January rally this year, Silvergate has been struggling in the aftermath of the FTX blowup. Shares of the bank slid sharply November, when the crypto exchange FTX, a Silvergate customer, collapsed in scandal.
Silvergate shares are now down about 20% in 2023. They are off by about 87% over the past year.
Earlier this month, shares of Silvergate tanked more than 40% after the bank reported massive withdrawals in the fourth quarter in light of the FTX collapse. Despite the rise in cryptocurrencies and stocks this month, investor confidence is still shaken.
BlackRock, the largest asset manager in the world, has maintained a positive stance toward crypto and blockchain technology. In addition to being an investor in FTX, late last summer the firm launched a private trust to give clients exposure to spot bitcoin.

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