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    Biden forgives $4.28 billion in student debt for 54,900 borrowers

    The Biden administration announced on Friday that it would forgive another $4.28 billion in student loan debt for 54,900 borrowers who work in public service.
    The relief is a result of fixes the U.S. Department of Education made to the once-troubled Public Service Loan Forgiveness Program.

    U.S. President Joe Biden delivers remarks on the economy at the Brookings Institution in Washington, DC, U.S. December 10, 2024. 
    Kevin Lamarque | Reuters

    The Biden administration announced on Friday that it would forgive another $4.28 billion in student loan debt for 54,900 borrowers who work in public service.
    The relief is a result of fixes the U.S. Department of Education made to the once-troubled Public Service Loan Forgiveness Program.

    The debt relief comes in President Joe Biden’s final weeks in office.
    Biden has forgiven more student debt than any other president. He has cleared nearly $180 billion for 4.9 million people with student debt.
    Still, Republican-led legal challenges have stymied all of Biden’s attempts at delivering wide-scale relief.
    This is breaking news. Please refresh for updates. More

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    Student loan servicer transfer led to ‘millions of consumer credit reporting errors’: Lawmakers

    A “faulty” transfer of student loan accounts from Nelnet to Mohela in 2023 led to “millions of consumer credit reporting errors,” lawmakers say in a new letter to government agencies reviewed by CNBC.
    The change in loan servicers caused nearly 2 million duplicate student loan records to appear on borrowers’ credit reports, and hundreds of thousands of borrowers’ credit scores being reported incorrectly for up to a year and a half, according to the letter, which Sen. Elizabeth Warren, D-Mass., Ron Wyden, D-Oregon, and other lawmakers sent on Wednesday evening.

    Chair Elizabeth Warren, D-Mass., conducts the Senate Finance Subcommittee on Fiscal Responsibility and Economic Growth hearing titled Promoting Competition, Growth, and Privacy Protection in the Technology Sector, in Dirksen Building on Tuesday, December 7, 2021.
    Tom Williams | CQ-Roll Call, Inc. | Getty Images

    A “faulty” transfer of student loan accounts from Nelnet to Mohela in 2023 led to “millions of consumer credit reporting errors,” lawmakers say in a new letter to government agencies reviewed by CNBC.
    The change in loan servicers caused nearly 2 million duplicate student loan records to appear on borrowers’ credit reports, while hundreds of thousands of borrowers’ credit scores were reported incorrectly for up to a year and a half, according to the letter. Sen. Elizabeth Warren, D-Mass., Ron Wyden, D-Oregon, and other lawmakers sent the letter on Wednesday evening to Consumer Financial Protection Bureau Director Rohit Chopra and U.S. Department of Education Secretary Miguel Cardona.

    As part of their investigation, the lawmakers sent inquiries to Nelnet, Mohela and three credit reporting companies: Equifax, Experian and Transunion. They asked the companies about what had gone wrong and how many borrowers were impacted.
    In their letter, the lawmakers urged the government agencies to investigate the problems.
    “We respectfully request that the CFPB and ED use their supervisory and enforcement authority to ensure that the appropriate parties are held accountable for these errors,” the lawmakers wrote.
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    Mohela appears to have failed to inform the credit reporting companies of each loan transfer from Nelnet, the lawmakers said they found in their investigation. As a result, many borrowers had their single loan balance reported twice, once by each servicer.

    Duplicate student loan balances on a borrowers’ credit report can reduce their credit scores and make it more difficult for them to obtain mortgages, car loans and other credit, the lawmakers note in the letter.
    Nelnet spokesperson Ben Kiser said the issues “arose out of an ED-directed change in servicing requirements,” which “are entirely outside servicers’ control.”
    Mohela did not immediately respond to a request for comment.

    The credit reporting companies identified “over 100,000 cases” in which the reporting errors led borrowers to have an incorrect credit score, according to the lawmakers’ investigation. Thousands of borrowers had their credit scores drop by more than 20 points, they said.
    They added that borrowers submitted around 7,500 complaints and disputes to Mohela and the credit reporting companies in attempts to fix the errors.
    The credit reporting companies told the lawmakers the duplicate balances “have been resolved now,” the letter said.
    An Equifax spokesperson said they were aware that some student loan servicers “did not report loans in adherence to the consumer reporting guidelines.”
    “We are working with the Department of Education and the servicers to correct misreported accounts and ensure that student loans are being appropriately reflected on consumer credit reports,” the spokesperson said. 
    A spokesperson for the Consumer Data Industry Association responded on TransUnion’s behalf to CNBC’s request for comment.
    “Our CDIA members were aware some consumers faced issues and actively worked with the student loan servicers to address the matter,” the spokesperson said. “The bureaus continue to work with servicers to ensure that student loan and other accommodations are being appropriately reflected on consumer credit reports.”
    Experian did not immediately respond to a request for comment. More

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    Senate expected to hold final vote on bill to change Social Security rules. Here’s what leaders have said

    As the Senate wraps up its final legislative days for the year, it is expected to vote on a bill that would increase Social Security benefits for about 3 million people.
    The Social Security Fairness Act calls for eliminating certain rules that have been in place for decades that reduce Social Security benefits for some people with public sector pensions.

    The US Capitol building in Washington, DC, on November 24, 2024. 
    Daniel Slim | Afp | Getty Images

    The Senate is getting closer to a final vote on a bill that would increase Social Security benefits for an estimated 3 million people.
    The chamber voted Wednesday to let consideration of the bill — the Social Security Fairness Act — proceed. The bipartisan proposal calls for repealing certain rules that reduce Social Security benefits for individuals who receive pension income from work in the public sector.

    Despite a bipartisan 73 majority vote to proceed, the effort to advance the bill was met with some dissent, with Sen. Thom Tillis, R-N.C., citing the costs associated with the change. The Congressional Budget Office has estimated repealing the rules — known as the Windfall Elimination Provision, or WEP, and Government Pension Offset, or GPO — would cost $196 billion over 10 years.
    The WEP reduces Social Security benefits for individuals who receive pension or disability benefits from jobs where they did not pay Social Security payroll taxes. The GPO reduces Social Security benefits for spouses, widows and widowers who also receive their own government pension income.

    Passing the bill would speed up Social Security’s trust fund insolvency dates by six months, according to the Committee for a Responsible Federal Budget. Without the change, Social Security’s trustees have projected the trust fund the program relies on to pay retirement benefits will run out in 2033, when 79% of those benefits will be payable.
    “We are about to pass an unfunded $200 billion spending package for a trust fund that is likely to go insolvent over the next nine to 10 years, and we’re going to pretend like somebody else has to fix it,” Tillis said during a Senate speech ahead of the vote to advance the bill.
    Tillis said lawmakers are not considering the 97% of beneficiaries who would not benefit from the bill, but who would be hurt by future consequences that passing it would have on the program.

    More from Personal Finance:Answers to common questions on the Social Security Fairness Act73% of workers worry Social Security won’t be able to pay benefitsEarly retirement is a surprise for many workers, study finds
    “Ladies and gentlemen, this bill has not even had a hearing in any committee in the House or the Senate,” Tillis said.
    The Social Security Fairness Act was approved by the House in November after two lawmakers – Reps. Abigail Spanberger, D-Va., and Garret Graves, R-La. – filed a discharge petition to force a vote on the bill. The Senate cloture vote to proceed to a final vote also limited the ability for that chamber to debate the proposal.
    The 27 Senate leaders who voted “no” on moving the Social Security Fairness Act to a final vote are all Republicans, with the exception of Sen. Joe Manchin, an independent representing West Virginia.
    The Senators who voted to move the bill forward included a mix of Democrats and Republicans, including Senate Majority Leader Chuck Schumer, D-N.Y., and Vice President-elect and Sen. JD Vance, R-Ohio.

    ‘No excuse for treating our public servants this way’

    Leaders who spoke on the Senate floor in support of the bill ahead of Wednesday’s vote to proceed cited the financial suffering of their constituents.
    As of November, more than 2 million people’s Social Security benefits were affected by the WEP, while more than 650,000 people were impacted by the GPO, said Sen. Susan Collins, R-Maine, who co-led the Senate version of the bill.
    One 72-year-old constituent had to return to work after her husband died, since the GPO reduced her Social Security widow benefits by two-thirds, Collins said.
    “She did not have the financial security any longer to remain retired, and the GPO penalty left her with few choices but to return to work,” Collins said.

    Sen. Bill Cassidy, R-La., recalled meeting with a retired Louisiana schoolteacher impacted by the GPO, who cried in his office because she didn’t understand why her Social Security spousal benefits were reduced.
    “She felt like she was being punished for educating generations of Louisiana children,” Cassidy said. “There’s no excuse for treating our public servants this way.”
    If the Senate passes the bill, it will be a win for Collins and Sen. Sherrod Brown, D-Ohio, who co-led the bill. Collins has pushed for the change for more than two decades, Brown noted in a Wednesday Senate speech. Brown is leaving the Senate after losing a reelection campaign.
    Reps. Spanberger and Graves, who introduced the House bill, are also leaving Congress.
    “If you love this country and fight for the people who make it work, I urge all my colleagues on both sides to join us — restore the Social Security that people who protect us in service have earned over a lifetime of work,” Brown said during a Wednesday Senate speech.

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    CFPB takes aim at ‘bait-and-switch’ credit card rewards — consumers forfeit about $500 million worth each year

    Nearly 1 in 4 cardholders — 23% — did not redeem any rewards at all in 2024, according to a new survey by Bankrate.
    More consumers say rewards can be difficult to redeem or are worth less than they thought, according to the Consumer Financial Protection Bureau.
    Now the CFPB is cracking down on what it calls “bait-and-switch” rewards programs.

    CFPB cracks down on rewards tactics

    About 90% of all credit card spending is on rewards cards. But according to the CFPB, an increasing number of consumers have reported that some rewards are hard to redeem or are not worth as much as they thought. In 2023 alone, complaints involving credit card rewards jumped 70% over pre-pandemic levels. 

    “Large credit card issuers too often play a shell game to lure people into high-cost cards, boosting their own profits while denying consumers the rewards they’ve earned,” CFPB Director Rohit Chopra said in a statement. “When credit card issuers promise cashback bonuses or free round-trip airfares, they should actually deliver them.”

    According to the Consumer Bankers Association, only a small share of credit card users report problems with rewards: Complaints regarding rewards made up just 2% of all credit card complaints reported to the CFPB since January 2020. 
    “The only bait-and-switch that’s happening here is from the CFPB once again misrepresenting its own data,” CBA President and CEO Lindsey Johnson said in a statement.
    “As the CFPB’s own research shows, credit cards are — by far — the best tool for the one-fifth of Americans that lack access to credit to begin building their financial lives,” Johnson said.
    Consumer complaints about credit card rewards are exceedingly rare, the American Bankers Association also noted.
    “Despite widespread evidence that credit card rewards programs are highly popular and deliver tremendous value to tens of millions of U.S. cardholders from all walks of life, Director Chopra has once again chosen not to let facts get in the way of his decision to tarnish a hugely popular consumer product,” Rob Nichols, the ABA’s president and CEO, said in a statement.

    Consumers like reward cards

    Even with credit card interest rates near an all-time high, when deciding on a new credit card, 83% of cardholders said their final decision comes down to perks, according to a separate report by CardRates.com.
    The majority, or 58%, of credit card users polled by CardRates said they preferred cash back over miles or points. But still, not all cardholders used the credit card rewards available to them.
    Travel rewards can be more lucrative but are notoriously harder to redeem, Bankrate also found. Only 11% of rewards cardholders redeemed for a free hotel stay, while just 10% redeemed for a free flight, according to Bankrate.
    “Failing to redeem your rewards is a major missed opportunity,” said Bankrate’s senior industry analyst Ted Rossman. “While the best rewards can be subjective, the worst reward is getting nothing at all.”

    How to make the most of rewards

    In the best-case scenario, credit card rewards are “almost like free money,” said Bill Hardekopf, a credit card expert and CEO of BillSaver.com.
    But that’s only if you pay your credit card off on time and in full every month. With credit card rates over 20%, on average, the benefits of cash back or other perks are quickly eroded if you carry a balance.
    “If you miss a payment or are late on a payment, you get socked with a huge penalty — that interest rate will far outweigh the rewards you are going to get,” Hardekopf said.
    When it comes to which reward card to choose, Hardekopf recommends a cash-back card with a low, or no, annual fee. “The best reward you can get is cash back because cash talks — it’s easy to understand and there’s no problem redeeming.”
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    Despite APRs that can top 30%, some shoppers still like retail credit cards over buy now, pay later plans

    When asked to choose between a store card or a buy now, pay later plan, 58% of surveyed shoppers prefer store cards, according to a new report by LendingTree.
    Interest rates for retail store credit cards are averaging a bit more than 30%.
    If you plan to finance your holiday purchases, keep in mind “ownership costs,” experts say.

    Filadendron | E+ | Getty Images

    High interest rates aren’t deterring many shoppers from store credit cards.
    When asked to choose between a store card or a buy now, pay later plan, 58% of surveyed shoppers prefer store cards, according to a new report by LendingTree. The remaining 42% picked BNPL loans.

    The site polled 2,040 U.S. adults in September.
    That choice “speaks to the fact people may be looking for a little bit longer-term help with their financial situation,” said Matt Schulz, chief credit analyst at LendingTree.
    In December, new cards offered by the top 100 retailers had an average annual percentage rate of 32.66%, up from 27.7% in 2022, according to the Consumer Financial Protection Bureau. Many short-term BNPLs do not charge interest, but longer-term loans do, and on the higher end, those rates can be comparable to a store card.
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    Younger shoppers have been early adopters of BNPL, and that shows in their payment preferences. 

    About 59% of Gen Zers and 51% of millennials prefer BNPL over retail store credit cards, Lending Tree found. To compare, 38% of Gen Xers and 22% of baby boomers prefer BNPL.
    “Buy now, pay later really started off as a millennial, Gen Z phenomenon,” Schulz said. “Younger Americans really drove a lot of the growth.” 
    Whichever payment option you plan to use to finance holiday purchases this year, keep in mind the cost of carrying the debt, experts say.

    How store cards and BNPL work

    Retail store credit cards and BNPL loans operate differently.
    A retail store credit card is a long-term, revolving line of credit that a store offers in conjunction with a bank partner. To entice new users, stores generally offer applicants a discount on their first card purchase, or financing deals. The card may also be tied into the retailer’s loyalty program, sometimes with bonus rewards for cardholders.
    A buy-now, pay later loan — issued through a provider the merchant works with — typically breaks up the total cost of a purchase into installment payments over a set period of time. Some providers offer longer repayment periods, too, and charge interest. Users can have multiple purchases with the same BNPL provider at once, but those may be treated as individual loans with their own repayment terms.
    With either payment method, make sure to pay off the balance on time — you might face penalties like fees and interest if you don’t stay on track.

    A retail credit card can affect your credit history, as the account is reported to the three major credit bureaus: Equifax, Experian and TransUnion.
    BNPL has been somewhat “invisible” to credit bureaus in the past, meaning the loan did not show up on users’ credit reports. But AfterPay, Affirm and Klarna are among the providers reporting some BNPL loans to the credit bureaus.
    Both payment forms can be attractive for shoppers. Retail store credit cards tend to be easier to qualify for compared to other credit cards, especially as banks have been tightening credit card approval requirements in recent months, Schulz said. 
    Over the third quarter of 2024, some banks have tightened their lending standards for credit card loans, lowered their credit limits and increased minimum credit score requirements, according to the Federal Reserve.
    “It’s a reaction from the banks to rising delinquencies, rising debt and overall economic uncertainty,” Schulz said.

    BNPL can also be relatively easy to apply for and qualify.
    “The rise of buy now, pay later is the biggest reason why Americans are opening fewer store cards,” according to Ted Rossman, an industry analyst at Bankrate.

    ‘Consider the total cost of ownership’

    The holiday season is here, a busy time to buy gifts for family and friends. If you find yourself in a situation where a retail store credit card or a BNPL can help stretch your budget, consider the “total cost of ownership,” Rossman said.
    “Both of these payment methods can be advantageous depending on how you use them, but could also be a pretty slippery slope into debt and overspending,” he said.
    BNPL can be tricky because you can have multiple loans running at the same time, and the costs “can add up,” Rossman said. Make sure to keep track of the pay-later loans you have and are able to withstand the automatic deductions.
    If you can’t pay a retail card purchase off at the end of the statement period, any discount, reward or perk that you may get is going to be washed over by the interest you’ll owe on top of the outstanding balance, Schulz said. 
    “Paying 30% interest to save 15 or 20% doesn’t make a whole lot of sense financially,” Schulz said. More

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    The Federal Reserve cuts interest rates by another quarter point. Here’s what that means for you

    The Federal Reserve lowered its benchmark rate by a quarter point, or 25 basis points, at the end of its two-day meeting.
    This marks the third rate cut in a row — all together shaving a full percentage point off the federal funds rate since September.
    Lower borrowing costs will trickle down to some consumer loans.

    The Federal Reserve announced Wednesday that it will lower its benchmark rate by another quarter point, or 25 basis points. This marks the third rate cut in a row — all together shaving a full percentage point off the federal funds rate since September.
    For consumers struggling under the weight of high borrowing costs after a string of 11 rate increases between March 2022 and July 2023, this move comes as good news — although it may still be a while before lower rates noticeably affect household budgets.

    “Interest rates took the elevator going up in 2022 and 2023 but are taking the stairs coming down,” said Greg McBride, chief financial analyst at Bankrate.com.
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    Although many people, overall, are feeling better about their financial situation heading into the new year, nearly 9 in 10 Americans think inflation is still a problem, and 44% think the Fed has done a bad job getting it under control, according to a recent survey by WalletHub.
    “Add in talk of widespread tariffs, and you’ve got a recipe for uneasy borrowers,” said John Kiernan, WalletHub’s managing editor.
    In the meantime, high interest rates have affected all sorts of consumer borrowing costs, from auto loans to credit cards.

    December’s 0.25 percentage point cut will lower the Fed’s overnight borrowing rate to a range of between 4.25% and 4.50%. Although that’s not the rate consumers pay, the Fed’s moves still affect the borrowing and savings rates consumers see every day.

    From credit cards and mortgage rates to auto loans and savings accounts, here’s a look at how the Fed rate reduction could affect your finances in the year ahead.

    Credit cards

    Most credit cards have a variable rate, so there’s a direct connection to the Fed’s benchmark. Because of the central bank’s rate hike cycle, the average credit card rate rose from 16.34% in March 2022 to more than 20% today — near an all-time high.
    Since the central bank started cutting interest rates, the average credit card interest rate has only edged off extremely high levels. 
    “Another rate cut is welcome news at the end of a chaotic year, but it ultimately doesn’t amount to much for those with debt,” said Matt Schulz, LendingTree’s credit analyst. “A quarter-point reduction may knock a dollar or two off your monthly debt payment. It certainly doesn’t change the fact that the best thing cardholders can do in 2025 is to take matters into their own hands when it comes to high interest rates.”
    Rather than wait for small annual percentage rate adjustments in the months ahead, the best move for those with credit card debt is to consolidate with a 0% balance transfer card or a lower-interest personal loan, Schulz said.
    Otherwise, ask your issuer for a lower rate on your current card — “that works way more often than you’d think,” he said.

    Customers shop for groceries at a Costco store on December 11, 2024 in Novato, California. 
    Justin Sullivan | Getty Images

    Auto loans

    Auto loan rates are also still sky-high — the average auto loan rates for used cars are at 13.76%, while new vehicle rates are at 9.01%, according to Cox Automotive.
    Since these loans are fixed and won’t adjust with the Fed’s rate cut, “this is another case where taking matters into your own hands is your best move,” Schulz said.
    In fact, anyone planning to finance a car may be able to save more than $5,000, on average, by shopping around for the best rate, a 2023 LendingTree report found.

    Mortgage rates

    Because 15- and 30-year mortgage rates are fixed and mostly tied to Treasury yields and the economy, they are not falling in step with Fed policy. 
    As of the latest tally, the average rate for a 30-year, fixed-rate mortgage increased to 6.75% from 6.67% for the week ended Dec. 13, according to Mortgage Bankers Association.
    “Mortgage rates have gone up — not down — since the Fed began cutting interest rates in September,” said Bankrate’s McBride.
    “With expectations for fewer rate cuts in 2025, long-term bond yields have renewed their move higher, bringing mortgage rates back near 7%,” he said.

    But since most people have fixed-rate mortgages, their rate won’t change unless they refinance or sell their current home and buy another property. 
    Anyone shopping for a home can still find ways to save.
    For example, a $350,000, 30-year fixed mortgage loan with an average rate of 6.6% would cost $56 less each month compared with November’s high of 6.84%, according to Jacob Channel, senior economic analyst at LendingTree.
    “This may not seem like a lot of money at first glance, but a discount of about $62 a month translates to savings of $672 a year and $20,160 over the 30-year lifetime of the mortgage,” he said.

    Student loans

    Federal student loan rates are also fixed, so most borrowers won’t find much relief from rate cuts.
    However, if you have a private loan, those loans may be fixed or have a variable rate tied to the Treasury bill or other rates. As the Fed cuts interest rates, the rates on those private student loans will come down over a one- or three-month period, depending on the benchmark, according to higher education expert Mark Kantrowitz.
    Still, “a quarter-point interest rate cut would reduce the monthly loan payments by about $1 to $1.25 on a 10-year term, about a 1% reduction in the total loan payments,” Kantrowitz said.
    Eventually, borrowers with existing variable-rate private student loans may be able to refinance into a less expensive fixed-rate loan, he said. But refinancing a federal loan into a private student loan will forgo the safety nets that come with federal loans, such as deferments, forbearances, income-driven repayment and loan forgiveness and discharge options.
    Additionally, extending the term of the loan means you ultimately will pay more interest on the balance.

    Savings rates

    While the central bank has no direct influence on deposit rates, the yields tend to be correlated to changes in the target federal funds rate.
    As a result of the Fed’s previous rate hikes, top-yielding online savings account rates have made significant moves and are still paying as much as 5% — the most savers have been able to earn in nearly two decades — up from around 1% in 2022, according to Bankrate.
    “The prospect of the Fed moving at a slower pace next year is better news for savers than for borrowers,” McBride said. “The most competitive yields on savings accounts and certificates of deposit still handily outpace inflation.”
    One-year CDs are now averaging 1.74%, but top-yielding CD rates pay more than 4.5%, according to Bankrate, nearly as good as a high-yield savings account.

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    Paying down debt is Americans’ top financial goal for 2025. Here are some tips that can help

    As the calendar turns to 2025, many Americans want to improve their finances in the New Year.
    Paying down debt is a top financial goal, one recent survey found.
    To successfully get those balances down for good, it helps to shift your priorities, experts say.

    Skynesher | E+ | Getty Images

    When it comes to financial resolutions for 2025, there’s one goal that often lands on the top of the list — paying down debt, according to a new survey from Bankrate.
    That’s as a majority of Americans — 89% — say they have a main financial goal for 2025, the November survey of almost 2,500 adults found.

    While paying down debt came in as a top goal, with 21%, other items on Americans’ financial to-do lists include saving more for emergencies, with 12%; getting a higher paying job or additional source of income, 11%; budgeting and spending better, 10%; saving more for retirement and investing more money, each with 8%; saving for non-essential purchases, 6%; and buying a new home, 4%.
    Those goals cap off a year that had some financial challenges for consumers. Some prices remain elevated, even as the pace of inflation has subsided. As Americans grapple with higher costs, credit card debt recently climbed to a record $1.17 trillion. The average credit card debt per borrower rose to $6,380 in the third quarter, according to TransUnion.

    Lower interest rates may help reduce the costs of holding that debt. The Federal Reserve moved on Wednesday to cut rates for the third time since September, for a total reduction of one percentage point.
    Yet the best-qualified credit card borrowers — those with superior credit scores — still have an average rate of 20.35%, down from around 20.79% in August, according to Mark Hamrick, senior economic analyst at Bankrate.
    “It could be injurious to personal finances if people accumulated debt that they’re not substantially paying down,” Hamrick said. “It’s prudent and heartening to see that people are identifying debt broadly as something they want to address in the coming year.”

    ‘The Fed isn’t the cavalry coming to save you’

    To pay down credit card balances — as well as other debts from auto loans or other lines of credit — individuals may need to shift their financial priorities.
    A majority of Americans admit to having bad financial habits, finds a recent survey from Allianz Life Insurance Company of North America.
    That includes 30% who admit to spending too much money on things they don’t need; 28% who don’t save any money; 27% who only save some money; 23% who aren’t paying down debt fast enough; and 21% who spend more than they earn.
    For debtors who want to pay their balances down, the best approach is to take matters into their own hands, said Matt Schulz, chief credit analyst at LendingTree.
    “Even though the Fed is reducing rates, the Fed isn’t the cavalry coming to save you,” Schulz said.
    More from Personal Finance:Why new retirees may need to rethink the 4% ruleThere’s ‘urgency to act’ to get best returns on cash, expert saysSlash your 2024 tax bill with these last-minute moves
    Asking your credit card company for a more competitive interest rate on your debt often works, according to Schulz. About 76% of people who asked for that in the past year got their way, LendingTree found.
    “It’s absolutely worth a call,” he said.
    Moreover, balance holders also may keep an eye out for 0% transfer offers, which can let them lock in a no-interest promotion for a fixed amount of time, although fees may apply. Or they may consider a personal loan to help consolidate their debts for a lower rate.
    Even as debtors prioritize those balances, it’s still important to prioritize personal savings, too. Experts generally recommend having at least three to six months’ living expenses set aside in case of an emergency. That way, there’s a cash cushion to turn to in the event of an unexpected car repair or veterinary bill, Shulz said.
    Admittedly, by also prioritizing savings, it will take more time to pare down debt balances, he said. But having savings on hand can also help stop the debt cycle for good. More

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    Here’s what to know before ‘taking some risk off the table’ with bitcoin profits, advisor says

    The price of bitcoin sailed past $100,000 in early December and was still up more than 130% year-to-date, as of Dec. 18.
    Some investors now have large bitcoin positions, but could rebalance to better align with their goals, risk tolerance and timeline.
    However, you’ll need to consider capital gains taxes when selling from a brokerage or exchange.

    Hispanolistic | E+ | Getty Images

    Many investors are likely still deciding whether to stay in bitcoin or reduce their profits from the last bull run to new all-time highs.
    So, after a strong year for bitcoin, it could be time for investors to weigh rebalancing their portfolio by shifting assets to align with other financial goals, according to financial experts.    

    The price of the flagship digital currency sailed past $100,000 in early December and was still up more than 130% year-to-date, as of Dec. 18. 
    Some investors now have large bitcoin allocations — and they could have a chance to “take some risk off the table,” said certified financial planner Douglas Boneparth, president of Bone Fide Wealth in New York.
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    “The golden rule of ‘never invest more than you’re willing to lose’ comes into play, especially when we’re talking about speculative assets,” said Boneparth, who is also a member of CNBC’s Financial Advisor Council.
    Before using bitcoin profits to buy other investments, you may consider using the gains to fund another financial goal, like retiring early or buying a home, he said.  

    Decide on your ‘line in the sand’

    There’s a different thought process if you want the money to stay invested, Boneparth said.
    Typically, advisors pick an asset allocation, or mix of investments, based on a client’s goals, risk tolerance and timeline.
    Often, there’s a “line in the sand” for the maximum percentages of a single asset, he said.  
    Typically, Boneparth uses a maximum of 20% of a client’s “investable net worth,” which doesn’t include a home, before he starts trimming allocations of one holding.

    ‘There’s no free lunch’ with taxes

    When selling crypto in a brokerage account or exchange, you could owe taxes on growth, depending on how long you’ve owned the asset, Boneparth said. 
    “There’s no free lunch,” he said. “Just because it’s crypto doesn’t mean you’re exempt from paying taxes on your gains.”
    You’ll owe regular income taxes on profits from crypto owned for one year or less. But you’ll trigger long-term capital gains — taxed at 0%, 15% or 20% — on profitable assets owned for more than one year. 

    However, you could harvest crypto gains tax-free if you’re in the 0% long-term capital gains bracket for 2024, experts say.
    For 2024, you’re eligible for the 0% rate with taxable income of $47,025 or less for single filers and $94,050 or less for married couples filing jointly. These amounts include any gains from crypto sales.
    “That’s a very effective strategy if you’re in that bracket,” Andrew Gordon, a tax attorney, certified public accountant and president of Gordon Law Group, previously told CNBC.
    The 0% capital gains bracket may be bigger than you expect because it’s based on taxable income, which you calculate by subtracting the greater of the standard or itemized deductions from your adjusted gross income. More