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“Underconsumption core” showcases the old items that people are still using.
The trend follows other recent pushes on social media to normalize not spending, such as “loud budgeting” and “de-influencing.”

Sophie Hinn with a pencil holder her mom made out of trash.
Courtesy Sophie Hinn

Using only one water bottle. Finishing that tube of makeup before buying another. Owning furniture that’s been passed down through generations.
This isn’t the lifestyle that social media influencers promoting their Amazon storefront or their brand discount codes show. So-called “underconsumption core,” however, is one of the latest personal finance trends to go viral on TikTok, with many videos about the topic receiving millions of views.

On social media, the “core” ending is often used to describe a shared aesthetic among users. Non-personal finance examples include cottage core and goblin core. Underconsumption core showcases the old items that people are still using.
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The trend is coming into play at a point when consumers feel increasingly cash-strapped.
“I think it’s romanticizing being middle class,” real estate agent Sophie Hinn of Okoboji, Iowa, told CNBC.
She has posted about how she embodies the trend, including using old towels for cleaning rags and filling her home with furniture that’s “thrifted, gifted, repurposed, [or] family hand-me-downs.”

‘Wrong to throw away perfectly usable things’

Maya Feldman with her old hairdryer.
Courtesy Maya Feldman

In a July video — one of the first using the term “underconsumption core” — 18-year-old Maya “Liu” Feldman from Germany shows the old hair dryer she still uses, and clothes from seventh grade and holey jeans she still wears.
Feldman’s TikTok immediately went viral, racking up more than 436,500 likes and 2.3 million views. Many users commented that they lead a similar lifestyle or that they were motivated to spend less after watching Feldman’s video.
“I didn’t really have a lot as a kid, and it kind of gave me this mentality of it being wrong to throw away perfectly usable things,” Feldman told CNBC.
The underconsumption core trend follows other recent pushes on social media to normalize not spending, such as “loud budgeting” and “de-influencing.”
“This one just puts a little bit more emphasis on upcycling items,” sustainability influencer Sabrina Pare told CNBC. A video showcasing her version of the trend — including the “7+ years old” leggings she still wears, and how she cuts open makeup products to “get every last drop” — received 210,600 likes.
She said de-influencing “was just focusing on not buying, and this was more focused on using what you have.”

Underconsumption or normal consumption?

Some creators have also argued that underconsumption core should instead be called “normal consumption core” because some of the behaviors frequently shown in the videos, such as reusing items, are a part of many people’s everyday lives. 
“With TikTok Shop and just people always trying to sell you something, I think it’s refreshing for people to see [that] other people don’t consume,” Hinn said.
Still, it’s possible for the underconsumption core trend to go too far, said Douglas Boneparth, a certified financial planner and the founder of Bone Fide Wealth, a wealth management firm based in New York City. He is also a member of CNBC’s Financial Advisor Council.

He pointed to the Financial Independence, Retire Early movement that gained popularity a few years ago as another example of people wanting to save money. Followers of the movement aim to save up to 75% of their income, often sacrificing current comforts for the goal of exiting the workforce early.
“The flip side is if you get too caught up in that, are you basically sucking the joy out of things?” Boneparth said. “Are you not allowing yourself to actually partake in some of the more fun or frilly things in life? If you’re in the extreme camp of each, neither is good.”

‘The key word in personal finance is personal’

Hinn, Feldman and Pare all showed different interpretations of underconsumption core in their TikToks. Also, none of them expressed interest in changing their lifestyles much because they felt they already had the underconsumption core mindset, even if the term didn’t exist yet.
“I think [sustainability] is definitely a part of my everyday life,” Pare said. “It’ll always be a part of my content.”
Still, she said she’s curious if people will be using the term “underconsumption core” a few months into the future.
While the videos about underconsumption core can serve as inspiration for how to save money, Boneparth emphasized that the strategies they promote shouldn’t necessarily be immediately adopted. It’s smart to assess how a certain change fits, and what kind of benefit you may see from the effort.

Even when the underconsumption core trend fades out on social media, a balanced financial lifestyle will still be important, he said.
“The key word in personal finance is personal,” Boneparth said. “The ultimate goal should be finding the thing that works for you that allows you to be consistent and allows you to be disciplined, whether we’re talking about savings, investing [or] the accumulation of assets.” More

Everything from car loans and mortgages to credit cards will be impacted once the Federal Reserve starts lowering interest rates.
Here’s how you can position yourself to benefit.

The Federal Reserve could start lowering interest rates as soon as next month, based on the latest inflation data.
“We think that the time is approaching,” Fed Chair Jerome Powell said at a press conference after the last Federal Open Market Committee meeting in July.

For Americans struggling to keep up with sky-high interest charges, a likely September rate cut may bring some welcome relief — even more so with the right planning.
“If you are a consumer, now is the time to say: ‘What does my spending look like? Where would my money grow the most and what options do I have?'” said Leslie Tayne, an attorney specializing in debt relief at Tayne Law in New York and author of “Life & Debt.”
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Fed officials signaled they expect to reduce the benchmark rate once in 2024 and four times in 2025.
That could bring the benchmark fed funds rate from the current range of 5.25% to 5.50% to below 4% by the end of next year, according to some experts.

The federal funds rate is the one at which banks borrow and lend to one another overnight. Although that’s not the rate consumers pay, the Fed’s moves still affect the rates they see every day on things such as private student loans and credit cards.
Here are five ways to position your finances for the months ahead:

1. Lock in a high-yield savings rate

Since rates on online savings accounts, money market accounts and certificates of deposit are all poised to go down, experts say this is the time to lock in some of the highest returns in decades.
For now, top-yielding online savings accounts are paying more than 5% — well above the rate of inflation.
Although those rates will fall once the central bank lowers its benchmark, a typical saver with about $8,000 in a checking or savings account could earn an additional $200 a year by moving that money into a high-yield account that earns an interest rate of 2.5% or more, according to a recent survey by Santander Bank in June. The majority of Americans keep their savings in traditional accounts, Santander found, which FDIC data shows are currently paying 0.45%, on average.
Alternatively, “now is a great time to lock in the most competitive CD yields at a level that is well ahead of targeted inflation,” said Greg McBride, chief financial analyst at Bankrate.com. “There is no sense in holding out for better returns later.”
Currently, a top-yielding one-year CD pays more than 5.3%, according to Bankrate, as good as a high-yield savings account.

2. Pay down credit card debt

With a rate cut, the prime rate lowers, too, and the interest rates on variable-rate debt — most notably credit cards — are likely to follow, reducing your monthly payments. But even then, APRs will only ease off extremely high levels.
For example, the average interest rate on a new credit card today is nearly 25%, according to LendingTree data. At that rate, if you pay $250 per month on a card with a $5,000 balance, it will cost you more than $1,500 in interest and take 27 months to pay off.
If the central bank cuts rates by a quarter point, you’ll save $21 and be able to pay off the balance one month faster. “That’s not nothing, but it is far less than what you could save with a 0% balance transfer credit card,” said Matt Schulz, chief credit analyst at LendingTree.
Rather than wait for a small adjustment in the months ahead, borrowers could switch now to a zero-interest balance transfer credit card or consolidate and pay off high-interest credit cards with a personal loan, Tayne said.

3. Consider the right time to finance a big purchase

If you’re planning a major purchase, like a home or car, then it may pay to wait, since lower interest rates could reduce the cost of financing down the road.
“Timing your purchase to coincide with lower rates can save money over the life of the loan,” Tayne said.
Although mortgage rates are fixed and tied to Treasury yields and the economy, they’ve already started to come down from recent highs, largely due to the prospect of a Fed-induced economic slowdown. The average rate for a 30-year, fixed-rate mortgage is now around 6.5%, according to Freddie Mac.
Compared to a recent high of 7.22% in May, today’s lower rate on a $350,000 loan would result in a savings of $171 a month, or $2,052 a year and $61,560 over the lifetime of the loan, according to calculations by Jacob Channel, senior economic analyst at LendingTree.
However, going forward, lower mortgage rates could also boost homebuying demand, which would push prices higher, McBride said. “If lower mortgage rates lead to a surge in prices, that’s going to offset the affordability benefit for would-be buyers.”
What exactly will happen in the housing market “is up in the air” depending on how much mortgage rates decline in the latter half of the year and the level of supply, according to Channel.
“Timing the market is virtually impossible,” he said. 

4. Consider the right time to refinance

For those struggling with existing debt, there may be more options for refinancing once rates drop.
Private student loans, for example, tend to have a variable rate tied to the prime, Treasury bill or another rate index, which means once the Fed starts cutting interest rates, the rates on those private student loans will come down as well.
Eventually, borrowers with existing variable-rate private student loans may also be able to refinance into a less expensive fixed-rate loan, according to higher education expert Mark Kantrowitz. 
Currently, the fixed rates on a private refinance are as low as 5% and as high as 11%, he said.
However, refinancing a federal loan into a private student loan will forgo the safety nets that come with federal loans, he added, “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.
Be mindful of potential loan -term extensions, cautioned David Peters, founder of Peters Professional Education in Richmond, Virginia. “Consider maintaining your original payment after refinancing to shave as much principal off as possible without changing your out-of-pocket cash flow,” he said.
Similar considerations may also apply for home and auto loan refinancing opportunities, depending in part on your existing rate.

5. Perfect your credit score

Those with better credit could already qualify for a lower interest rate.
When it comes to auto loans, for instance, there’s no question inflation has hit financing costs — and vehicle prices — hard. The average rate on a five-year new car loan is now nearly 8%, according to Bankrate.
But in this case, “the financing is one variable, and it’s frankly one of the smaller variables,” McBride said. For example, a reduction of a quarter percentage point in rates on a $35,000, five-year loan is $4 a month, he calculated.
Here, and in many other situations, as well, consumers would benefit more from paying down revolving debt and improving their credit scores, which could pave the way to even better loan terms, McBride said.

Don’t miss these insights from CNBC PRO More

The T-Mobile logo is displayed on a laptop screen and a smartphone, seen in this illustration photo taken in Krakow, Poland, Feb. 22, 2024.
Jakub Porzycki | Nurphoto | Getty Images

The July consumer price index reading indicated cooling inflation and July retail sales addressed investors’ fears about an economic slowdown. They also boosted hopes of an interest rate cut at the Federal Reserve’s upcoming meeting in September.
Amid improving market sentiment, investors looking for some good stocks can rely on top Wall Street analysts, who can suggest stocks with attractive long-term growth potential. Top analysts make recommendations after conducting an in-depth analysis of a company’s financials, competitive backdrop and future prospects. 

With that in mind, here are three stocks favored by the Street’s top pros, according to TipRanks, a platform that ranks analysts based on their past performance.
Monday.com
This week’s first pick is project management software provider Monday.com (MNDY). The company impressed investors with its second-quarter results and raised full-year outlook, thanks to strong demand from large customers. Notably, the number of paid customers with more than $100,000 in annual recurring revenue (ARR) increased by 49% to 1,009.
In reaction to the robust results, TD Cowen analyst Derrick Wood boosted his firm’s price target for MNDY to $300 from $275 and reiterated a buy rating, calling the stock a top pick. The analyst highlighted solid demand for Monday.com’s products among high-paying customers, with the company winning its largest deal ever with a multinational healthcare company.
“We see this as a proof-point that MNDY is successfully moving up-market and becoming more of a platform sale, and we think this is an early sign of more large deals to come,” Wood said of the deal.
The analyst also noted that Monday.com expects its net dollar retention (NDR) rate to remain stable at about 110% through fiscal 2024, with management projecting a modest upside by the end of the year. 

“We see upmarket traction, new product adoption, and pricing tailwinds as strong growth vectors for continued execution into 2H,” said Wood.
Wood ranks No. 197 among more than 8,900 analysts tracked by TipRanks. His ratings have been successful 60% of the time, with each delivering an average return of 13.3%. (See MNDY Hedge Fund Trading Activity on TipRanks)
CyberArk Software
Another favorite tech company is CyberArk Software (CYBR). The identity security company posted upbeat second-quarter results and raised its full-year outlook, citing durable demand for its platform.
Following the Q2 print, Baird analyst Shrenik Kothari reaffirmed a buy rating on CYBR stock and raised his price target to $315 from $295. The analyst believes that the strong NNARR (net new annual recurring revenue) in Q2, solid new business acquisitions and the expansion of business among existing customers were driven by CYBR’s unified identity security platform. 
Kothari noted that CYBR’s workforce identity and machine identity solutions are emerging as major growth catalysts. He believes that the stock’s premium valuation compared to peers is justified, given “the shift to recurring revenues and CYBR’s position as a market leader.”
Despite macroeconomic challenges, the analyst is optimistic about the demand for CyberArk’s identity security solutions due to an evolving threat landscape. He added that the company’s robust profitability and free cash flow indicate its ability to leverage clients’ identity security needs.
The analyst highlighted that management is positive about the pending acquisition of Vanafi, which is expected to enhance CyberArk’s position in the machine identity security market. 
Kothari ranks No. 196 among more than 8,900 analysts tracked by TipRanks. His ratings have been profitable 72% of the time, with each delivering an average return of 22.7%. (See CYBR Stock Charts  on TipRanks)
T-Mobile US, Inc.
Finally, the week’s third stock pick is wireless network provider T-Mobile US (TMUS). The company recently reported better-than-expected second-quarter results and raised its full-year guidance for postpaid net customer additions and cash flows.
On August 12, Tigress Financial Partners analyst Ivan Feinseth reiterated a buy rating on TMUS stock and increased his price target 15% to $235 from $205. T-Mobile US continues to outperform the industry in terms of customer additions and services revenue growth, backed by “the industry’s best ultra capacity 5G high-speed network,” Feinseth said.
T-Mobile’s high-speed network and extensive 5G availability are boosting subscriber growth and driving higher revenue and cash flow, the analyst added. Highlighting TMUS’ vast footprint, Feinseth said that the company’s 5G network reaches 98% of Americans, while its ultra capacity 5G network covers over 330 million people. He expects the company to benefit from opportunities in fixed wireless access (FWA).
Additionally, Feinseth is encouraged by T-Mobile’s shareholder returns. In Q2 2024, TMUS returned $3 billion to shareholders via $759 million in dividends and $2.3 billion in share repurchases.
Feinseth ranks No. 239 among more than 8,900 analysts tracked by TipRanks. His ratings have been profitable 60% of the time, with each delivering an average return of 11.9%. (See TMUS Stock Buybacks  on TipRanks) More

Many people who borrow private student loans are required to get a co-signer, a requirement that can spread the pain if repayment becomes a challenge.
“It’s very, very difficult to get off of the loan if you are a co-signer,” said Anna Anderson, a staff attorney at the National Consumer Law Center. “We’ve seen how this can destroy families.”

Kumikomini | Istock | Getty Images

In 2004, Sabrina Finch returned to school to become a nurse.
Her mother, Rebecca, was excited for Sabrina, then in her early 30s, to finally have a career. She’d watched for years as Sabrina struggled to get by working low-wage jobs, including in fast-food restaurants and factories.

As a result, when Sabrina took out a private student loan from Navient in 2007 to complete her nursing degree, Rebecca was happy to be the co-signer on the loan.
Both women have come to regret that decision.
Sabrina, who is now 53 and lives in Vinton, Virginia, said her life took many difficult turns in the last two decades.
She said she became resistant to treatments for her bipolar disorder and found it difficult to get out of bed on many mornings. Consequently, she fell behind on her bills.
In May, Navient excused Sabrina from her private student loan after she proved her disability left her unable to work. However, the company then transferred the loan to her mother.

Rebecca is now 85, with health challenges of her own, including cardiovascular disease and constant pain from a fractured hip. Several strokes have left Rebecca with speech and cognitive issues, Sabrina said.
Rebecca’s only income is her roughly $1,650 monthly Social Security benefit. There’s no way she can afford to pay down the loan balance, which is more than $31,000, Sabrina said.
“I’m worried they’ll take her house,” Sabrina said. So is Rebecca, she said.
Sabrina spoke on her mother’s behalf, given Rebecca’s extensive medical issues.

Rebecca Finch
Courtesy: Rebecca Finch

Paul Hartwick, vice president of corporate communications at Navient, a significant owner of private education debt, said it informed Finch in April that the loan would be transferred to her mother if she was removed from it.
“A co-signer for a loan is liable for the account if the primary borrower cannot or does not make payments on the loan,” Hartwick wrote in an email to CNBC.

Lenders require co-signer on most private student loans

The private student loan market is skyrocketing — and with it the number of family members and friends who are also on the hook for the debt as co-signers.
As the cost of higher education swells, the $130 billion private education loan industry has grown —more than 70% between 2010 and 2019, according to the Student Borrower Protection Center. Today, Americans owe more in private student loans than they do in past-due medical debt or payday loans.
Borrowers of private student loans are much more likely to be required to have a co-signer compared with other kinds of lending, said Hanneh Bareham, a student loans expert at Bankrate.com.
“There are other loan types that offer co-signers as an option to assist with getting approved or getting a lower interest rate, but many don’t require co-signers like some private student loan lenders do,” Bareham said.
Indeed, more than 90% of private student loans include a co-signer who is equally financially and legally responsible for the debt, according to an analysis by higher education expert Mark Kantrowitz.
“A co-signer is often required for a private student loan because the student borrower has a thin or non-existent credit history,” Kantrowitz said. “They are an unproven asset.”
But there are many financial risks and few safeguards for co-signers of private student loans, said Anna Anderson, a staff attorney at the National Consumer Law Center.

Pavlo Gonchar | Lightrocket | Getty Images

“It’s hard to predict how things will turn out for the student when they first take out the loan,” Anderson said. “Graduation is sometimes years down the road, and there is no guarantee that the student will be able to graduate at all.”
Nearly half of all borrowers ages 50 and up who co-signed on a private student loan ended up making a payment on the loan themselves, a 2017 AARP survey found.
“It’s truly an inter-generational problem,” said Persis Yu, deputy executive director at the Student Borrower Protection Center.

‘It’s very, very difficult to get off of the loan’

The U.S. Department of Education, which typically doesn’t require co-signers on its federal student loans, forgives the debt of borrowers who become permanently disabled or can prove they were defrauded by their schools. Federal student loans also die with the borrower.
In contrast, student loan forgiveness by private lenders is extremely rare, experts say.
Only about half of the lenders discharge the debt when the primary borrower becomes disabled or dies, according to Kantrowitz, who’s been tracking education loan data for decades.

We’ve seen how this can destroy families.

Anna Anderson
lawyer at the National Consumer Law Center

Even when a lender does grant a borrower relief, as Sabrina found, the debt then often falls on their co-signer, said Anderson, of the National Consumer Law Center.
“It’s very, very difficult to get off of the loan if you are a co-signer,” Anderson said. “We’ve seen how this can destroy families.”
Carolina Rodriguez, director of the Education Debt Consumer Assistance Program, or EDCAP, in New York, agreed.
“Based on my experience, co-signer release is virtually non-existent in practice,” Rodriguez said.
Indeed, the Consumer Financial Protection Bureau found in 2015 that private student lenders rejected 90% of co-signer release applications.

Her private debt has nearly doubled

In October, Sabrina was approved for disability benefits through Social Security because of her schizoaffective bipolar disorder. Another neurological issue she’s recently developed requires her to use a wheelchair most of the time.
“I really wanted to keep nursing, but my mental illness kept me from doing it,” Sabrina said.
The Education Department often forgives the federal student loans of borrowers who can document that they’re receiving Social Security disability benefits over a long period. Sabrina didn’t need to go through that process, because the Education Department canceled her federal student loan balance in October through its recent relief efforts for those who have been in repayment for many years. Her federal student loan debt was around $120,000.

Rebecca Finch’s house in Troutville, Virginia.
Courtesy: Rebecca Finch

But her private student loan balance has only grown.
Sabrina originally borrowed $17,600 from Navient in 2007; the loan balance is now more than $31,000, according to information provided by Hartwick. The variable interest rate is currently set at 10%.
Sabrina said Rebecca, who is now responsible for the debt, can’t afford the $312 monthly loan payment.
Rebecca worked low-wage jobs throughout her career, mostly as a cashier at a truck stop. Her mortgage payment, at around $635, eats up more than a third of her $1,650 monthly Social Security benefit.
“My mom barely makes enough to cover her basic human needs,” Sabrina said.

Sabrina said her worst fear is that the lender will come after her mother’s two-bedroom house in Troutville, Virginia. She said one of the callers from Navient mentioned that possibility to her. Rebecca’s house was built in the 1950s and has a leaking roof and no heat, among other problems that the family can’t afford to fix, Sabrina said.
“But it’s all she has,” she said.
Hartwick, of Navient, said he couldn’t comment on whether the lender discussed the possibility of a lien on Rebecca’s house.
“But I can say, in general, private student loans do not go into collections until after a period of delinquency,” Hartwick said. “And, like other loans, there’s a process, often lengthy, to take legal action toward repayment.”

My mom barely makes enough to cover her basic human needs.

Sabrina Finch

Lenders of private student loans are incredibly aggressive with their collection tactics, said Anderson, of the National Consumer Law Center.
“We see drastic steps taken where the borrowers are sued, and get brought into court and end up with very costly judgments against them,” Anderson said. “This can result in liens being placed on their houses, having their wages garnished and bank accounts frozen.”
Hartwick said Navient recommended Rebecca apply to the company for a disability discharge herself.
Sabrina told CNBC she has informed Navient that her mother is ill. Sabrina submitted that application on behalf of her mother on July 26, and is waiting for a determination.
That didn’t stop Navient from continuing to contact Rebecca, Sabrina said.
“They are unrelenting even though they have the review in process,” she said.
Hartwick said borrowers can always contact the lender and share their communication preferences “or update their communication preferences online — including asking us to not call them.”

A father’s retirement at risk

In 2007, Kathleen Cullen began attending The French Culinary Institute, a for-profit school in downtown Manhattan, with dreams of becoming a chef. Her father, Ken, a union electrician, co-signed her nearly $30,000 private student loan from Navient.
“He was excited about the possibility, and looking to help me fast-track myself into a career,” said Cullen, now 41. “We couldn’t afford to do the traditional college route.”
Unfortunately, Cullen said, the nine-month education program fell far short of the world-class one she was promised by the school’s recruiters. Many of her classes were taught by recent graduates of the school and centered on simple knife and food safety lessons, knowledge she could have picked up online, she said.
“You wouldn’t expect a whole class to be on learning a basic French recipe like beef bourguignon,” Cullen said.
The International Culinary Center, formerly known as The French Culinary Institute, is no longer enrolling students, according to its website. It says it is now collaborating with The Institute of Culinary Education.
Former International Culinary Center students brought a class-action lawsuit against the center in 2014, alleging an “ongoing fraudulent scheme.” That lawsuit was dismissed in 2015. Rodriguez, of EDCAP, said the suit was likely settled out of court.
EDCAP is helping Cullen in her efforts to get Navient to cancel her debt. Cullen was not involved in the 2014 lawsuit, Rodriguez said.
“They promised high employment prospects, high quality teachers and courses, and it was a lie,” Rodriguez said of The French Culinary Institute. “The degree was worthless.”
“The Institute of Culinary Education entered into a licensing agreement with [The French Culinary Institute/ The International Culinary Center] in 2020 upon their closure,” Stephanie Fraiman Weichselbaum, public relations and communications director at the Institute of Culinary Education, wrote to CNBC in an email.
“We therefore cannot comment, as we have no records prior to that time,” Fraiman Weichselbaum said.
Cullen, who lives in New York City, said that because of the poor-quality education she received, she’s still working as a bartender and earns around $40,000 a year. That makes it difficult for her to meet her private student loan bill each month, she said.
Whenever Cullen falls behind, her father receives phone calls from Navient, she said.
“His phone is just going off the hook,” she said. “It puts a huge strain on our relationship.”

He was excited about the possibility, and looking to help me fast-track myself into a career.

Kathleen Cullen

Anderson, of the National Consumer Law Project, said parents who co-sign on student loans for for-profit schools are at additional risk.
“We have seen many instances of students and family members taking out private loans to cover expenses at for-profit institutions that have a history of poor outcomes for students, often leaving them further behind in terms of job prospects and financial stability,” Anderson said.
“This is different than when someone co-signs on a loan for something tangible that their loved one will benefit from right away, such as a car or an apartment,” she said.
Asked about Cullen’s case, Navient’s Hartwick reiterated that co-signers are responsible for the loans when borrowers don’t pay, adding that this is the case with many other types of debt.
“If an account is delinquent, we may contact both the borrower and co-signer,” Hartwick said.
Cullen said that despite her father saving for retirement for decades, he’s now worried her debt will upend his plans. The private student loan currently has a 15% interest rate, and the balance is nearing $77,000 today, more than double what Cullen originally borrowed, according to financial records reviewed by CNBC.
“He’s worked so hard to make sure he has a safety net, and the loan puts that in jeopardy,” Cullen said.
Her father declined to be interviewed but gave permission for his daughter to share their story.
Cullen is in the process of trying to prove to Navient that her school defrauded her. In such cases, the lender will consider discharging the borrower’s debt and releasing any co-signer, said Eileen Connor, director of litigation at The Project on Predatory Student Lending.
Navient provides a form specifically for borrowers seeking cancellation on the basis of school misconduct. However, Navient frequently rejects such requests, even when the federal government has agreed to forgive the student debt for that school, Connor said.
“What we’ve seen is a lot of denials that don’t make sense,” Connor said. “There’s just not an explanation.”
Hartwick declined to comment on Navient’s debt cancellation process for defrauded borrowers.
Borrowers who have asked a loved one to co-sign the debt have few options, Connor said.
“You have to keep paying, because you don’t want to ruin your mother’s credit,” she said. “They have borrowers trapped.” More

Vice President Kamala Harris on Friday called for an expanded child tax credit, which has been a priority for Democrats.
Her plan would restore up to $3,600 per child or up to $6,000 in total benefits for middle- and low-income families during the first year of a child’s life.
The plan comes less than one week after Sen. JD Vance of Ohio, former President Donald Trump’s GOP running mate, floated a $5,000 child tax credit. 

U.S. Vice President Kamala Harris speaks at an event with U.S. President Joe Biden (not pictured) in Prince George’s County, Maryland, U.S., August 15, 2024. 
Elizabeth Frantz | Reuters

Vice President Kamala Harris on Friday unveiled an economic plan, including an expanded child tax credit worth up to $6,000 in total tax relief for families with newborn children.
The Democratic presidential nominee’s plan aims to restore the higher child tax credit enacted via the American Rescue Plan in 2021, which provided a maximum credit of up to $3,600 per child, according to a fact sheet from the campaign.

The 2021 credit was up to $3,000 or $3,600, depending on the child’s age and family’s income. Harris’ proposed tax break would increase for middle- to lower-income families for one year after a child is born.
“We will provide $6,000 in tax relief to families during the first year of a child’s life,” said Harris during a policy speech in Raleigh, North Carolina.
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The plan comes less than one week after Sen. JD Vance of Ohio, former President Donald Trump’s GOP running mate, floated a $5,000 child tax credit. 
A Trump campaign official told CNBC: “Trump will consider a significant expansion of the child tax credit that applies to American families.”

While Harris has followed President Joe Biden’s footsteps with her proposed child tax credit expansion, the $2,400 bonus for newborns is “different and somewhat surprising,” said Kyle Pomerleau, senior fellow and federal tax expert with the American Enterprise Institute. “That, to me, sounds very much like a response to JD Vance.”
The Harris campaign did not immediately respond to CNBC’s request for comment.

‘Bipartisan momentum’ for the child tax credit

Senate Republicans earlier in August blocked an expanded child tax credit that passed in the House with broad support. However, Republican lawmakers are expected to revisit the measure after the election.
“There is bipartisan momentum behind expanding the [child tax credit],” said Andrew Lautz, associate director for the Bipartisan Policy Center’s economic policy program.

There is bipartisan momentum behind expanding the [child tax credit].

Andrew Lautz
Associate director for the Bipartisan Policy Center’s economic policy program

The size of the expansion and future credit design will hinge on which party controls the White House and Congress. But the House-passed bill and Senate negotiations could be a starting point, Lautz said.

Future child tax credit expiration

Without action from Congress, the maximum child tax credit will drop from $2,000 to $1,000 once Trump’s 2017 tax cuts expire after 2025.
The American Rescue Plan temporarily increased the maximum child tax credit from $2,000 to either $3,000 or $3,600, depending on the child’s age. Families received up to half via monthly payments for 2021.
The child poverty rate fell to a historic low of 5.2% in 2021, largely due to the credit’s expansion, according to a Columbia University analysis.

If there’s a future child tax credit expansion, Pomerleau doesn’t expect it to be as large as the tax break that Harris or Vance have proposed.
Amid the federal budget deficit, lawmakers are already wrestling with trillions in expiring tax cuts that are “prohibitively expensive,” he said.
Expanding the child tax credit to $3,000 or $3,600 could cost an estimated $1.1 trillion over a decade, according to the Committee for a Responsible Federal Budget. Meanwhile, the expansion to $6,000 for newborns could cost $100 billion.
The Harris campaign’s economic plan fact sheet said she would fulfill her “commitment to fiscal responsibility,” including calls for higher taxes on wealthy Americans and large corporations. More

The federal minimum wage has not increased from $7.25 per hour since 2009.
On the campaign trail, Democratic presidential nominee Kamala Harris has said that needs to change.
While some states and companies have enacted their own higher pay thresholds, some say it’s time to raise the national minimum pay rate.

Activists demonstrate in support of a $15-per-hour minimum wage and tips for restaurant workers in Washington, D.C. on Feb. 8, 2022.
Mandel Ngan | AFP | Getty Images

The federal minimum wage recently marked a new anniversary. But for affected workers, that may not be something to celebrate.
The federal minimum wage has now been stuck at $7.25 per hour for 15 years.

On the campaign trail, Democratic presidential nominee Kamala Harris recently suggested that should change.
“When I am president, we will continue our fight for working families of America, including to raise the minimum wage and eliminate taxes on tips for service and hospitality workers,” Harris said at an Aug. 10 Nevada campaign event.
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Many states have enacted minimum hourly pay rates that are higher than the federal minimum wage. Yet 20 states have wages that are no higher than the federal level, according to Business for a Fair Minimum Wage. They include Alabama, Georgia, Idaho, Indiana, Iowa, Kansas, Kentucky, Louisiana, Mississippi, New Hampshire, North Carolina, North Dakota, Oklahoma, Pennsylvania, South Carolina, Tennessee, Texas, Utah, Wisconsin and Wyoming.
The federal minimum wage for tipped workers is $2.13 per hour, provided their tips bring them to the $7.25 per hour federal minimum wage. Michigan recently became the first state in more than four decades to eliminate the subminimum wage for tipped workers.

Harris has not said how high she wants to raise the minimum wage, though she has praised states that have raised the rate to at least $15 per hour.
The Harris campaign did not return a request for comment by CNBC.

Congressional Democrats in 2021 tried to raise the federal minimum wage to $15 per hour as part of a broader Covid relief package. However, those efforts failed after it was determined the change could not be included in legislation handled through a one-party majority.   
During a 2020 debate, then President Donald Trump expressed concerns about whether raising the federal pay threshold would hurt small businesses.
“How are you helping your small businesses when you’re forcing wages?” Trump said during the 2020 debate. “What’s going to happen and what’s been proven to happen is when you do that these small businesses fire many of their employees.”
Trump’s campaign did not respond a request for comment by CNBC.
A CNBC survey from earlier this year found a majority of small business owners — 61% — support raising their state’s minimum wage, though half said such a change could make it difficult to be able to afford to pay workers who are critical to their businesses.
One point that tends to get lost in the minimum wage debate is the connection between a higher wage and stronger consumer buying power, according to Holly Sklar, CEO of advocacy group Business for a Fair Minimum Wage.
“When you lose minimum wage buying power, it means you’re losing customer buying power,” Sklar said.
Once workers earn higher minimum wages, they will be more likely to spend that money, which will help businesses, she said.
Raising today’s federal minimum wage would help low-wage workers who are trying to earn a living and have a sense of economic security, said Ben Zipperer, senior economist at the Economic Policy Institute, a Washington, D.C., think tank that provides economic research.
“The minimum wage has basically lost, 29%, 30% of its purchasing power over the last 15 years, simply because Congress has failed to update it,” Zipperer said.

Lifting the minimum wage threshold to $15 per hour would increase the incomes of about 20 million workers, Zipperer said. That would include people who are low-wage workers who may be earning hourly pay that is slightly more than the federal minimum wage threshold.
“Changes in wages don’t necessarily result in big changes in employment,” Zipperer said.
“When you raise wages at a particular workplace, that makes it a lot easier to recruit and retain workers,” he said.
Some companies, such as Target and Walmart, have set their own higher minimum pay thresholds, at $15 and $14 per hour, respectively, in response to tight retail labor market conditions.
Still, advocates hope for a broader change at the national level.
“We look forward to supporting efforts to raise the minimum wage in the next White House, in the next Congress, and showing that there’s a very good business case for that,” Sklar said. More

The 20 most-watched stock-picking videos on TikTok from 2023 to June 2024 show that over 64% of the 87 total stock predictions in these videos came out accurate.
Experts that CNBC spoke to warned against talking wholesale advice from these “finfluencers,” but agreed that they help promote financial awareness among young investors.

FILE PHOTO: TikTok app logo is seen in this illustration taken, August 22, 2022. 
Dado Ruvic | Reuters

Investing in equities can be a complex exercise, warranting specialized guidance. From where can one get that advice?
Some attempt to do their own research, poring over reams of financial indicators to identify potential winners, while others consult investment advisors and experts with years of experience in the market.

There are also people who look at the movement of celestial bodies or the earthly elements to determine where to put their cash.
And then there are those who turn to social media, scrolling through their feeds to seek out “financial influencers” or “finfluencers” to multiply their their money.
Let’s take a look at that last set of advisors — the “finfluencers” — as there popularity, especially among young investors, has been growing and could supersede that of traditional investment advisors.

Track record

While the idea of investing based on advice from someone on Tiktok appears risky — maybe not as much as investing based on astrological signs — these “finfluencers” have had quite a solid track record in the first half of 2024.
The investment theme for the first half of 2024 was dominated by an outsized focus on the tech industry, especially on stocks that are a part of the artificial intelligence value chain.

Brokerage aggregator site BestBrokers analyzed the 20 most-watched stock-picking videos on TikTok from 2023, that recommended shares that could potentially surge in 2024.
The team then tracked the prices of the recommended stocks from the day the videos were posted up until June 21, 2024. It also calculated returns on a $1,000 investment in each stock or ETF recommended in these videos.
“Our findings show that over 64% of the 87 total stock predictions in these videos came out accurate, including the remarkable rallies of AI stocks such as Nvidia and Qualcomm,” the BestBrokers report from July said. About 36% of the recommendations resulted in losses.
The report said that a majority of the influencers had advised picking stable, blue-chip stocks such as Google, Nvidia and Amazon, something that traditional money experts also advise to people looking for less risky investments.
The most profit that an investor could have generated from a single stock would have been Nvidia, which grew 63.08% in the period surveyed. An investment of $1,000 in the stock would’ve grown to a substantial $1,630.79.
On the flip side, a $1,000 investment into the worst performing stock — New York-listed biotech company Ginkgo Bioworks Holdings — would have fetched a 74.74% loss.
What if one decided to cut the risk by not betting on a single name and, instead, diversified by purchasing all stocks recommended in a single video?
If a person invested $1,000 in every stock recommended in the one video that got the most bets right, the gains would have amounted to $4,860.
However, “[this] would require a $23,000 initial investment in 23 different stocks, some profitable, some not so much.”
On the other hand, putting money into all the stocks recommended in the video that got most bets wrong would have led to a loss of $1,517. 

Credibility concerns

Given the aforementioned track record, is following advice proffered by financial influencers a reliable method for growing your wealth?
Experts CNBC talked to do not think “finfluencers” are a sound alternative to professional analysts and brokers.
Gerald Wong, founder and CEO of Singapore investment advisory platform Beansprout said it may not be fair to conclude that these “finfluencers” can be trusted, simply because a lot of their stock predictions were accurate over a short time period. Wong also added that the broader U.S. stock market in general did well during the period of the study.
The accuracy of their predictions is “spurious,” said Jeremy Tan, CEO of asset and wealth management firm Tiger Fund Management. “Furthermore, a single period coincident result does not translate to a definitive conclusion of predictability in the long run.”
Jiang Zhang, head of equities at First Plus Asset Management, said that as these influencers are largely unregulated and have unknown credentials, they could have questionable objectivity.
They could be paid by companies to promote those shares, or might be front-running — recommending shares they own to others with the aim of boosting stock prices and then cashing out — Zhang said.
The motivations of these “finfluencers” could be in conflict with the interests of those who are seeking advice on these platforms, Tan said. “Recommendations or opinions found online could often be biased, unverified and provided by individuals that are not professionally certified or regulated.”
“Very often, insufficient disclosures are provided for the public to discern the independence of such recommendations,” he added.

Investor education

For all their caution against taking investment advice from “finfluencers,” the experts agreed that social media content creators, especially on Tiktok, do help spread financial literacy among younger investors.
Beansprout’s Wong, who was with Credit Suisse for 13 years before founding his investment advisory platform, suggested that Gen Z investors have a “keen desire” to learn more about investing through self directed means, compared to consulting with a financial planner or advisor.
In a survey conducted by Beansprout, more than half of the respondents said that they were not confident about the investment decisions they have made, signaling a dearth of investment advisory avenues.
“We believe this reflects how access to expert investment insights has not caught up with the proliferation of investment platforms and products in the market,” Wong said.
Influencers could bridge this gap by distilling research and content into bite-sized content that is easily relatable and digestible for retail investors, according to Emelia Tan, director of research and financial literacy at the Singapore Exchange.
First Plus’ Zhang said, “compared with traditional financial news media that report mostly factual events, the finfluencers’ investment narrative offer retail investors the most value as it helps the viewers on how to craft an investment view based on publicly available information.”
He does not think that “finfluencers” and professional advisors should be seen as mutually exclusive avenues for investment know-how.
Influencers can be a starting point for investors to get the basics of investing and wealth management, but they should seek professional financial advice from established and regulated financial institutions, given the superior investor protection offered by these institutions, Zhang said. More

About 2.9 billion people may have had their personal financial data compromised, a lawsuit alleges.
“It’s not a matter of if, it’s a matter of when” you may be personally affected by a breach, one expert says.
Experts say there’s one best step to take to protect your personal data.

Sakorn Sukkasemsakorn | Istock | Getty Images

About 2.9 billion people may have had their personal information hacked, a new proposed class action lawsuit alleges.
If true, reports suggest all Americans may have had valuable personal information compromised — including full names, current and past addresses, Social Security numbers and information on parents, siblings and other relatives.  

The alleged April 2024 breach occurred when a background check company doing business as National Public Data, owned by Jerico Pictures Inc., failed to properly safeguard information it scraped, the lawsuit states. The company provides instant search access to billions of records.
Neither National Public Data nor Jerico Pictures returned requests for comment by CNBC.
“If this turns out to be accurate … then it would just basically mean that everyone’s affected,” said Cliff Steinhauer, director of information security and engagement at The National Cybersecurity Alliance, a nonprofit focused on cybersecurity awareness and education.

However, this breach may not be as far-reaching as reports suggest, said James E. Lee, chief operating officer at the Identity Theft Resource Center, a nonprofit working to minimize the risk of identity theft.
For example, if there were multiple records per individual compromised, that could reduce the total number of people affected. If other countries were affected too, that could reduce the number of Social Security numbers involved. In addition, much of the information leaked may have already been available elsewhere, he said.

‘You’re vulnerable forever’

Massive data breaches are not new.
A 2017 Equifax data breach was estimated to have affected half the U.S. population. In 2013, a Yahoo data breach may have hit all the company’s accounts, or a total of 3 billion people.
Still, experts say the news of this latest breach should put consumers on high alert.
“It’s not a matter of if, it’s a matter of when,” Steinhauer said. “I’d be surprised [if] there are many people who haven’t been affected by a data breach like this already, just because of the sheer number of breaches that have happened that contain similar data.”
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Consumers tend to find out their information may have been compromised through data breach notices from the companies affected.
“We’ve got enough data now to say if you get a data breach notice, there’s a high likelihood that you’re going to suffer an identify crime at some point within 12 months,” Lee said.
While it’s still not possible to directly correlate a breach to an identity theft, he said, the risks have no expiration date once your information has been exposed.
“You’re vulnerable forever,” Lee said.

Freezing your credit is the ‘No. 1 piece of advice’

The best tip to protect your personal records is to put a security freeze on your credit reports, which will limit access to your records, experts say.
It’s also the best first step if you think your data has been compromised.
“Freezing your credit is the single most important thing you can do when you get a data breach notice,” Lee said.
The process can be done quickly and for free by submitting separate requests to each of the three credit bureaus, which includes Equifax, Experian and TransUnion.
While freezing your credit will limit access to your credit reports, it won’t block it completely. Your records will still be available to certain companies and under certain circumstances.
The freeze doesn’t just block bad actors. Notably, if you want to apply for a new credit card or auto loan, you may get rejected if you do not unfreeze your credit first.

As you freeze your credit, you should proceed with caution. Make sure you’re not clicking on a lookalike domain that purports to be one of the three major credit bureaus that could instead be operated by hackers, Steinhauer said.
Additionally, do not open your personal records on public Wi-Fi, he said.
Consumers can purchase additional protection through dark web monitoring services, which will let you know when your information is compromised. While that step can provide peace of mind, it’s not going to stop anything from happening, Lee said.
Consumers should also make sure they have strong and unique passwords that use multifactor authentication, where two or more steps are used before access to an account is granted. Consumers may want to consider using a password manager, which can help generate strong passwords and store those codes, Steinhauer said.

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