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The Federal Reserve held interest rates steady at the end of its two-day meeting Wednesday.
The Fed’s decision to remain on the sidelines still has far-reaching implications for almost all forms of borrowing as well as the returns you earn on your savings.
From credit cards and mortgage rates to auto loans and savings accounts, here’s a look at how your wallet is impacted.

When the Fed hiked rates in 2022 and 2023, the interest rates on most consumer loans quickly followed suit. Even though the central bank lowered its benchmark rate three times in 2024, those consumer rates are still elevated, and are mostly staying high, for now.

Five ways the Fed affects your wallet

1. Credit cards
Many credit cards have a variable rate, so there’s a direct connection to the Fed’s benchmark.
With a rate cut likely postponed until July, the average credit card annual percentage rate has stayed just over 20% this year, according to Bankrate — not far from 2024’s all-time high. Last year, banks raised credit card interest rates to record levels and some issuers said they are keeping those higher rates in place.
At the same time, “more people are carrying debt because of higher prices,” said Ted Rossman, senior industry analyst at Bankrate. Total credit card debt and average balances are also at record highs.
2. Mortgages

Prospective home buyers leave a property for sale during an Open House in a neighborhood in Clarksburg, Maryland.
Roberto Schmidt | AFP | Getty Images

Mortgage rates don’t directly track the Fed, but are largely tied to Treasury yields and the economy. As a result, uncertainty over tariffs and worries about a possible recession are dragging those rates down slightly.
The average rate for a 30-year, fixed-rate mortgage is 6.91% as of May 6, while the 15-year, fixed-rate is 6.22%, according to Mortgage News Daily. 
Mortgage rates “are showing signs of life after a slow couple of years,” said Michele Raneri, vice president and head of U.S. research and consulting at TransUnion. 
But for potential home buyers, that’s not enough of a decline to give the housing market a boost. “Many borrowers are reluctant to take on a loan at today’s rates, particularly if they currently have a loan at a significantly lower rate,” Raneri said.
3. Auto loans
Auto loan rates are tied to several factors, but the Fed is one of the most significant.
With the Fed’s benchmark holding steady, the average rate on a five-year new car loan was 7.1% in April, while the average auto loan rate for used cars is 10.9%, according to Edmunds. At the end of 2024, those rates were 6.6% and 10.8%, respectively.
With interest rates near historic highs and car prices rising — along with pressure from Trump’s 25% tariffs on imported vehicles — new-car shoppers are facing bigger monthly payments and an affordability crunch, according to Joseph Yoon, Edmunds’ consumer insights analyst.
“Consumers continue to face a challenging market, now with added uncertainty of the tariff impact on their next vehicle purchase,” Yoon said. “Prices and interest rates remain elevated, and there’s no fast or easy answer as to how the tariffs will affect inventory levels — and therefore pricing — as buyers try to make sense of an increasingly complex shopping journey.” 
4. Student loans
Federal student loan rates are fixed for the life of the loan, so most borrowers are somewhat shielded from Fed moves and recent economic turmoil.
Interest rates for the upcoming school year will be based in part on the May auction of the 10-year Treasury note, and are expected to drop slightly, according to higher education expert Mark Kantrowitz. Undergraduate students who took out direct federal student loans for the 2024-25 academic year are paying 6.53%, up from 5.50% in 2023-24.

Borrowers with existing federal student debt balances won’t see their rates change, adding to the other headwinds some now face along with fewer federal loan forgiveness options.
5. Savings
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.
“Continued high interest rates are discouraging for those with debt but awesome for savers,” said Matt Schulz, chief credit analyst at LendingTree. 
Yields for CDs and high-yield savings accounts may not be as high as they were a year ago, but the Fed’s rate cut pause has left them well above the annual rate of inflation, Schulz said. Top-yielding online savings accounts currently pay 4.5%, on average, according to Bankrate.
“With all of the uncertainty in the economy right now, it makes sense for people to act now to lock in CD rates and take advantage of current high-yield savings account returns while they still can,” Schulz said.
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Federal student loans may come with slightly lower interest rates in the 2025-2026 academic year, according to an estimate by higher education expert Mark Kantrowitz.
The drop in interest rates could provide some very modest relief to families trying to cover college costs.

Skynesher | E+ | Getty Images

Expected student loan interest rates for 2025-2026

The interest rate on federal direct undergraduate loans could be 6.39% in the 2025-2026 academic year, estimates Kantrowitz. The undergraduate rate for the 2024-2025 year is 6.53%.
At those new undergraduate rates, every $10,000 a family borrowed would lead to a $113 monthly student loan payment after graduation, assuming the student enrolled in a standard 10-year repayment plan. With interest, the borrower would repay $13,559.87 over that decade.
For graduate students, loans will likely come with an 7.94% interest rate, compared with the current 8.08%, Kantrowitz finds.

PLUS loans for graduate students and parents may have a 8.94% interest rate, a decrease from 9.08% now.

The government sets interest rates on its education loans once a year. The rates, which run from July 1 to June 30 of the following year, are based in part on the May auction of the 10-year Treasury note.
Kantrowitz based his calculations on the Treasury Department’s announced high-yield rate on Tuesday of 4.34%.

Which borrowers face lower rates 

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As of March 2025, the IRS workforce had fallen by more than 11,000 employees, or 11%, according to a Treasury Inspector General for Tax Administration report.
The percentage of separated employees was higher for “revenue agents,” who conduct audits. As of March, the agency lost 3,623 revenue agents, or 31%.
However, U.S. Treasury Secretary Scott Bessent on Tuesday said “collections” are still a priority for the agency.

A traffic light is red outside the U.S. Internal Revenue Service building in Washington, D.C., on Feb. 20, 2025.
Kent Nishimura | Reuters

The IRS has lost nearly one-third of tax auditors amid sweeping cuts from Elon Musk’s Department of Government Efficiency, a watchdog report found.
As of March 2025, the agency’s workforce had fallen by more than 11,000 employees, or 11%, due to probationary terminations and the deferred resignation program, according to a May 2 report from the Treasury Inspector General for Tax Administration.

The percentage of separated employees was significantly higher for certain departments — including so-called “revenue agents,” who conduct audits for the IRS. As of March, the agency lost 3,623 revenue agents, or 31%, according to the report.
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The TIGTA report came the same day as President Donald Trump’s fiscal year 2026 discretionary budget request, which called for a nearly $2.5 billion IRS budget cut to end the “weaponization of IRS enforcement.”
U.S. Treasury Secretary Scott Bessent on Tuesday defended the reduced spending request in a House of Representatives Appropriations subcommittee hearing. He said the federal government has cut $2 billion from the agency’s information technology budget “without any operational disruptions.”
As of April 25, the IRS processed more than 140 million returns during the 2025 filing season, slightly more than the previous year, according to agency data.

The Treasury did not respond to CNBC’s request for comment about the TIGTA report.

IRS cuts could help ‘wealthy tax dodgers’

In a March letter to former acting IRS commissioner Melanie Krause, more than 130 House Democrats warned that cutting compliance staff could limit the agency’s ability to collect unpaid taxes from “wealthy tax dodgers.” The lawmakers were responding to IRS staffing cuts that began in late February.
Those cuts hurt the agency’s ability to “improve collections, crack down on complex tax avoidance and evasion by high-income taxpayers and large businesses,” the lawmakers wrote.

Audits of the top 0.1% of taxpayers returned more than $6 in revenue for every dollar spent in resources, according to a 2023 working paper from researchers at the U.S. Department of the Treasury, Massachusetts Institute of Technology, the Wharton School and University of Sydney.
At the House Appropriations subcommittee hearing on Tuesday, Bessent said “collections” were among his IRS priorities. But he expects to meet revenue goals via “smarter IT” and the “AI boom” rather than via “unseasoned collections agents.”
“I would expect that collection would continue to be very robust,” he said. More

Newly confirmed Social Security commissioner Frank Bisignano has faced a series of questions on his involvements with the Department of Government Efficiency.
Among Bisignano’s priorities for Social Security: reducing its error rate, which would help eliminate overpayment issues that leave beneficiaries owing the agency money.
Here’s what we know about Bisignano’s views on the future of Social Security benefits.

Frank Bisignano testifies before the Senate Finance Committee on his nomination to be Commissioner of the Social Security Administration, on Capitol Hill in Washington, DC, March 25, 2025. 
Saul Loeb | AFP | Getty Images

The Senate has voted to confirm Frank Bisignano as the new commissioner of the Social Security Administration, ushering in new leadership at a federal agency that has already undergone many changes this year under the Trump administration’s Department of Government Efficiency.
Bisignano, the chairman and CEO of payments and financial technology company Fiserv Inc., was nominated to serve as Social Security commissioner in December by then President-elect Donald Trump. Trump started his second term on Jan. 20.

The Social Security Administration, which provides monthly benefit checks to more than 73 million beneficiaries, is currently operating under temporary leadership. Acting commissioner Leland Dudek took the helm in February, replacing Michelle King, who stepped down from the temporary role due to concerns about DOGE’s access to sensitive data.
A federal judge has since granted a preliminary injunction that prevents DOGE from accessing personally identifiable information including Social Security numbers, medical records, addresses, bank records, tax information and other sensitive data.
Bisignano’s confirmation vote on Tuesday was divided by party lines. Prior to the vote, Republicans had expressed support for Trump’s nominee, while Democrats raised concerns about Bisignano’s prospective leadership and his alleged ties to DOGE.
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On the eve of the Senate confirmation vote, Democrats including Sens. Elizabeth Warren of Massachusetts and Ron Wyden of Oregon held a rally outside the Senate building to oppose Bisignano’s nomination.

“We want Donald Trump to stand with working families and seniors and stop the attack on Social Security once and for all,” Wyden, ranking member of the Senate Finance Committee, said at the Monday event.
Following the Tuesday Senate vote, advocacy groups expressed concern about the new agency leadership.
“This vote was an opportunity for the Senate to reject the decimation of Social Security, and demand that Trump nominate a commissioner who will stop the bleeding,” Nancy Altman, president of Social Security Works, said in a statement. “Instead, every Senate Republican just signed off on the DOGE destruction of Social Security.”
Neither Fiserv nor the White House responded to CNBC’s requests for comment by press time.

Who is Frank Bisignano?

Bisignano currently serves as chairman and CEO of Fiserv, which processes more than $2.5 trillion in payments per day, according to his Senate testimony.
Bisignano came to that role after serving as chairman and CEO of First Data Corp., which went public in 2015 and combined with Fiserv in 2019.
Before that, Bisignano was co-chief operating officer for JPMorgan Chase and CEO of its mortgage banking unit. Prior to JPMorgan Chase, he held several roles at Citigroup.
Bisignano was raised in a working class, multigenerational immigrant household in Brooklyn, New York, according to his Senate testimony. Bisignano’s father was a 46-year Department of Treasury employee who worked in customs enforcement.
“He was the hardest working person I’ve known,” Bisignano said in his Senate testimony. “I view federal workers from that vantage point.”

What lawmakers said about Bisignano’s nomination

During the consideration of Bisignano’s nomination, Democrats repeatedly raised concerns about his viability to lead the agency.
Warren and Wyden sent a letter to Bisignano ahead of his March confirmation hearing to ask about his views on privatizing the agency. The efforts by DOGE to “hollow out” the agency and “deprive Americans of Social Security benefits they earned and need” may pave the way for a “private sector fix,” the Democratic leaders said.
In his Senate testimony, Bisignano said he did not intend to privatize the agency.
“I’ve never thought about privatizing,” Bisignano said. “It’s not a word that anybody’s ever talked to me about. I don’t see this institution as anything other than a government agency that gets run for the American public.”

During the Senate hearing, Bisignano also faced questions about his involvement with recent changes at the Social Security Administration and with DOGE.
Wyden introduced an anonymous whistleblower letter from a “senior Social Security Administration employee who recently left the agency,” who said Bisignano had been briefed on “key SSA operations, personnel and management decisions.”
In response to a question about whether he would “lock DOGE out,” Bisignano promised to protect personally identifiable information.
“I am going to do whatever is required to protect the information that is private,” Bisignano said.
However, during a February CNBC interview, Bisignano said he is “fundamentally a DOGE person.”
While Democrats have cast doubt on Bisignano’s nomination, the Fiserv CEO has received praise from Republicans and former Citigroup CEO Sandy Weill.
In a March CNBC interview, Weill praised Bisignano as a “great manager” and “terrific person.”
“He used to work for me, and I think he’s the best operations person I’ve ever met in my life,” Weill said, adding we would be “very lucky to have him in that job.”

What Bisignano has said about Social Security

During a March Senate confirmation hearing, as he fielded questions from senators on a host of issues facing the Social Security Administration, Bisignano said it will be important to “put the beneficiaries first.”
“The ability to receive payments on time and accurately is job one,” Bisignano said.
Among the priorities Bisignano said he would emphasize if confirmed include bringing the Social Security’s error rate down, citing an Office of the Inspector General report that put it at around 1%.
“That’s a very high payment processing error rate,” Bisignano said, calling it “five decimal places too high.”
Reducing the agency’s error rate will help eliminate overpayment issues, where beneficiaries receive too much money in their benefit checks. Those errors, which may take months or years to catch, typically leave beneficiaries owing large sums to the Social Security Administration.
From fiscal years 2015 through 2022, the Social Security Administration paid about $71.8 billion in improper payments out of almost $8.6 trillion in benefits, representing about 0.84%, according to a 2024 Office of the Inspector General report.
The agency is currently in the process of adjusting the default withholding rate to 50% for certain benefits affected by overpayments, such as retirement, survivors and disability insurance. Under President Joe Biden, the default rate had been lowered to 10% of monthly benefits or $10, whichever was greater.
“I’m going to make sure that we recover all the money we should recover, but on the other hand we have to be humans in the process, too,” Bisignano told the Senate about overpayment clawbacks.

Bisignano also said he planned to reduce the chronically long wait times Americans face when seeking help from the agency, including when calling its 800 number or when applying for disability benefits.
Having to wait for more than 20 minutes on the phone is not acceptable, Bisignano said. Social Security Administration data shows only about 46% of calls get answered, likely because people get discouraged and hang up, he said.
“I think we could get that to under a minute,” Bisignano said of the agency’s phone wait times, in part by making AI available to people answering the phones to more quickly prompt them with the information they need to answer individuals’ queries.
Bisignano also promised to investigate why it takes so much time to process disability applications. Initial eligibility determinations currently take around seven months, a wait time that has doubled since prior to the Covid-19 pandemic, according to the Urban Institute. More

Warren Buffett and Greg Abel walkthrough the Berkshire Hathaway Annual Shareholders Meeting in Omaha, Nebraska on May 3, 2025.
David A. Grogen | CNBC

Retail investors poured more than $24 million into Berkshire Hathaway’s Class B stock on Monday, proving it’s not just a Warren Buffett cult stock and providing a vote of confidence in incoming CEO Greg Abel.
Everyday traders sent about $24.4 million on balance into Berkshire’s B stock during the session, marking the stock’s highest sum of net inflows since 2016, according to Vanda Research.

The shares declined more than 5% on Monday for their third worst session in the last half-decade, as Buffett shocked the investing world on Saturday with his announcement that he intends to leave the chief executive role at year-end, and Abel set to take the reins.

Buffett’s initial announcement came as tens of thousands of shareholders flocked to Omaha for the yearly gathering, which has become a tradition over Buffett’s six decades helming the sprawling conglomerate. Shareholders idolize the “Oracle of Omaha,” with meeting attendees sporting apparel featuring his likeness and waiting in long lines to purchase a plush toy of him.
“I think the time has arrived where Greg should become the chief executive officer of the company at year end,” Buffett said near the end of Saturday’s question-and-answer event with shareholders.
Buffett is seen as one of the most successful advocates of investing — specifically through a disciplined and value-focused lens — to everyday people. Monday’s inflows may surprise some market observers, as conventional wisdom would suggest mom-and-pop traders would be uneasy with the longtime company leader stepping away.
Yet Monday’s net inflows were more than three times to size of what was seen the previous Friday, underscoring the surge of interest in the stock following the news. It was also the fourth-largest one-day net haul for the stock going back to when Vanda began collecting data in 2014.

Berkshire’s biggest one-day net flows since 2014

Date
Net flows (in U.S. dollars)

6/24/2016
41543725

8/24/2015
26606101

12/9/2014
25732006

5/5/2025
24356196

1/4/2016
22001366

Source: Vanda Research

Now, investors are wondering what’s next for Berkshire under Abel, who hasn’t shown an ability to pick stocks exceptionally well, the trait that made Buffett a rock star to the regular Joe investor. But they may be appeased by Buffett’s comment that he plans to “hang around” and after the board voted to keep him on as chairman.
Buffett, who is Berkshire’s largest investor with more than $160 billion worth of stock, also said he wouldn’t sell a single share of the company he built from a failing textile company into a $1.2 trillion titan. He showered Abel with praise during the meeting, which may have helped ease jitters among attendees about the path forward.

Warren Buffett does a walkthrough of the Berkshire Hathaway Annual Shareholders Meeting in Omaha, Nebraska on May 3, 2025.
David A. Grogen | CNBC

“The decision to keep every share is an economic decision because I think the prospects of Berkshire will be better under Greg’s management than mine,” the 94-year-old said.
Buffett’s future has loomed particularly large over shareholders since the passing of longtime friend and business partner Charlie Munger in 2023. He announced in a shareholder letter released in February that he began walking with a cane and that it “won’t be long” before Abel would take over writing the annual memo.
Despite Monday’s downturn, shares are still up more than 13% in 2025. The S&P 500, which Berkshire has run circles around over the last 60 years under Buffett, has fallen more than 4% this year.

Stock chart icon

Berkshire Hathaway, Class B shares

Retail investors, who helped bid the stock up to a record the Friday before the meeting, may also be banking on Berkshire being a safe haven if tough economic times are ahead. Berkshire has more than $330 billion in cash on hand, enough to buy all but 23 members of the S&P 500 outright.
And perhaps the little guy is betting Buffett, who in the past has done his biggest buying when others are the most fearful, has one last bargain deal in him before he hangs it up. More

The Trump administration is set to garnish the wages of the 5.3 million federal student loan borrowers in default in just a few months.
Meanwhile, it began this week alerting around 195,000 defaulted borrowers that their federal benefits will be subject to garnishment in 30 days.

US President Donald Trump signs executive orders relating to higher education institutions, alongside US Secretary of Education Linda McMahon (R), in the Oval Office of the White House in Washington, DC, on April 23, 2025.
Saul Loeb | Afp | Getty Images

The Trump administration resumed collection efforts on defaulted student loans Monday after a roughly five-year hiatus — and affected borrowers could begin feeling the financial consequences sooner than experts expected.
The U.S. Department of Education released new details on what actions it plans to take, when.

Here’s what to know.

Federal benefits could be garnished by June

Wages at risk over the summer

The Treasury Department will send notices to 5.3 million defaulted borrowers about the collection activity of their wages “later this summer,” the Education Department wrote in the Monday press release.

How student loan collection efforts have changed

Since the pandemic began in March 2020, collection activity on federal student loans has mostly been paused. The Biden administration focused on extending relief measures to struggling borrowers in the wake of the Covid pandemic and helping them to get current.
The Trump administration’s aggressive collection activity is a sharp turn away from that strategy, experts say.
“Borrowers should pay back the debts they take on,” said U.S. Secretary of Education Linda McMahon in a video posted on X on April 22.

The U.S. government has extraordinary collection powers on federal debts and it can seize borrowers’ federal tax refunds, wages, and Social Security retirement and disability benefits.
But in the past, student loan borrowers were usually given 65 days’ notice before the garnishment of their federal benefits, said higher education expert Mark Kantrowitz.
“Odd that they say a 30-day notice,” Kantrowitz said.
Historically, the offsets to people’s retirement and disability benefits were also “a last resort,” Kantrowitz said, “occurring a year after wage garnishment and other attempts at collection had failed.”
“Given the timing, it sounds like they are not pursuing the normal due diligence schedule for collecting defaulted federal student loans,” Kantrowitz added.
The U.S. Department of Education did not immediately respond to a request for comment.

Social Security garnishments may hurt retirees

Carolina Rodriguez, director of the Education Debt Consumer Assistance Program in New York, recently told CNBC that she was especially concerned about the consequences of resumed collections on retirees.
“Losing a portion of their Social Security benefits to repay student loans could mean not having enough for food, transportation to medical appointments or other basic necessities,” Rodriguez said in an April interview.

There are some 2.9 million people ages 62 and older with federal student loans, as of the first quarter of 2025, according to Education Department data. That’s a 71% increase from 2017, when there were 1.7 million such borrowers.

How to avoid collection activity

Borrowers in default will receive emails making them aware of the new policy, the Education Department said. You can contact the government’s Default Resolution Group and pursue a number of different avenues to get current on your loans, including enrolling in an income-driven repayment plan or signing up for loan rehabilitation. 
Some borrowers may also be eligible for deferments or a forbearance, which are different ways to pause your payments, Rodriguez said.
“We’re advising clients to request a retroactive forbearance to cover missed payments, and a temporary forbearance until they can get enrolled in an income-driven repayment plan,” she said.
Are you at risk of collection activity because you’re behind on your student loans? If you’re willing to share your experience for an upcoming story, please email me at [email protected]

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Amid heightened uncertainty stemming from the trade war, the Federal Reserve is widely expected to hold its benchmark short-term borrowing rate steady at its meeting this week.
From credit cards and mortgage rates to auto loans and savings accounts, all sorts of consumer borrowing costs are impacted by Fed moves, even a decision to keep rates unchanged.

On the heels of a stronger-than-expected jobs report and elevated inflation readings, the Federal Reserve is expected to hold interest rates steady at the end of its two-day meeting this week — despite pressure from President Donald Trump.
“Consumers have been waiting for years to see pricing come down. NO INFLATION, THE FED SHOULD LOWER ITS RATE!!!” Trump said in a Truth Social post Friday.

As an independent agency, the central bank has always operated autonomously from the White House. Federal Reserve Chair Jerome Powell has repeatedly said that monetary policy decisions are completely separate from politics. At the same time, the president’s new trade policies are a barrier to cutting rates, in part because economists expect the new tariffs could lead to a widespread rise in prices that complicate inflation forecasts.
To be sure, many Americans are getting squeezed by high prices and high borrowing costs, while the potential inflation impacts from a costly trade war weigh heavily on household budgets.
“Consumers are always the ones who pay the price,” said Eugenio Aleman, chief economist at Raymond James.
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The federal funds rate sets what banks charge each other for overnight lending, but also affects many of the borrowing and savings rates consumers see every day.

“Uncertainty rules amid a trade war and the ever-changing landscape of tariffs,” said Greg McBride, Bankrate’s chief financial analyst. “But with the hard data on consumer spending and employment still hanging in there, the Fed will remain firmly planted on the sidelines.”
Markets now widely expect the Fed to wait to cut rates until July, with two or three more reductions to follow by the end of the year.
Once the federal funds rate comes down, borrowing costs could decrease across a variety of consumer debt, such as auto loans, credit cards and mortgage rates, making it easier to access cheaper money. 
Here’s a breakdown of how it works.

Credit cards

Most credit cards have a variable rate, so there’s a direct connection to the Fed’s benchmark.
For the most part, the average annual percentage rate has hovered just over 20% this year, according to Bankrate, not far from last year’s all-time high. 
The Fed holding steady isn’t the only thing keeping credit card rates high. “Banks are nervous about all of the uncertainty in the economy and what it means for consumers,” said Matt Schulz, chief credit analyst at LendingTree.
“When that happens, banks try to minimize risk as much as possible, and one of the ways they do that is to raise interest rates on credit cards,” he said.

Credit card debt continues to be a pain point for consumers struggling to keep up with high prices. Total credit card debt and average balances are also at record highs.

Mortgages

Although 15- and 30-year mortgage rates are largely tied to Treasury yields and the economy, concerns about the direction of the economic policy and Trump’s tariff plans have been a drag on rates, according to the Mortgage Bankers Association.
The average rate for a 30-year, fixed-rate mortgage is now 6.81%, down from 7.04% at the beginning of the year, according to Bankrate. But for potential home buyers, that’s not enough of a decline to give the housing market a boost.
“Unfortunately for those shopping for a home this summer, rates are likely to stay in or around that range in the near future,” Schulz said.

Auto loans

Although auto loan rates have seen little change, car payments have gone up because prices are rising, while Trump’s 25% tariffs of imported vehicles adds more pressure.
Currently, the average rate on a five-year new car loan is 7.33%, down from 7.53% in January, according to Bankrate.

Student loans

Federal student loan rates are fixed for the life of the loan, so most borrowers are somewhat shielded from Fed moves and recent economic turmoil.
Interest rates for the upcoming school year will be based in part on the May auction of the 10-year Treasury note and aren’t likely to change much. Undergraduate students who took out direct federal student loans for the 2024-25 academic year are paying 6.53%, up from 5.50% in 2023-24.
Although borrowers with existing federal student debt balances won’t see their rates change, many are now facing other headwinds and fewer federal loan forgiveness options.

Savings

On the upside, top-yielding online savings accounts still offer above-average returns and currently pay as much as 4.5%, according to Bankrate. 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 — so holding that rate unchanged has kept savings rates elevated, for now.
“For consumers, oftentimes the best way to protect your finances in times of uncertainty is to double-down on boosting emergency savings and eliminating high interest rate debt,” said Bankrate’s McBride. “This builds a buffer in the event of an income disruption or unanticipated expenses and insulates you from costly borrowing.”
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Americans may be able to get digital access to their Social Security numbers starting this summer.
The Social Security Administration is rolling out the new form of identification as an alternative to paper Social Security cards.
Digital access could be a help when replacing your Social Security card if it’s lost or stolen.

Richcano | E+ | Getty Images

For many Americans, a Social Security number is the first form of identification they receive, mailed as a paper card a few weeks after birth.
Now, the Social Security Administration is looking to give that form of ID an update by enabling secure digital access to Social Security numbers that will provide an alternative to the traditional Social Security card. Experts are cautiously optimistic about the idea, but have some security concerns.

The new digital feature will allow individuals who have either forgotten their Social Security number or who have lost their Social Security cards to access their personal number online through the agency’s My Social Security website. They will also be able to access their Social Security numbers through digital devices and display them as identification for “reasons other than handling Social Security matters,” according to the agency.
More from Personal Finance:Social Security reduces benefit clawback rateTrump administration restarts student loan collectionsWhat experts say about claiming Social Security benefits early
With the new effort, the Social Security Administration aims to reduce the inconveniences caused by lost or stolen cards, which currently requires individuals to apply for replacements either online or in person.
“We believe that this modern approach will meet the needs of our constituents in a more efficient manner,” Social Security Administration acting commissioner Lee Dudek said in a statement.
The agency declined to provide more details the rollout, which is scheduled to become available early this summer.

Experts worry about access, ID theft protections

Experts are cautiously optimistic about the change.
“Generally, anything that is a new avenue for accessing your account or in an interaction with Social Security is a good thing, so long as it’s easy and secure,” said Richard Fiesta, executive director at the Alliance for Retired Americans.
However, the risk is that some individuals, particularly those who are older or disabled, may be left without access if they are not as tech savvy and have difficulty using the internet or mobile phones, he said.
My Social Security is “not the most customer friendly website,” Fiesta said, despite efforts to improve it over the years.

The move toward digital Social Security identification is “certainly a step in the right direction,” said Eva Velasquez, CEO of the Identity Theft Resource Center.
If implemented properly, the digital Social Security numbers may provide more security than paper cards, she said.
“But it really doesn’t solve the problem of identity misuse,” Velasquez said.
Every adult’s Social Security number has likely already been breached, according to Velasquez. The size of the 2024 National Public Data breach prompted some experts to speculate every American could have been affected. The 2017 Equifax breach was estimated to have affected roughly half the U.S. population.
The new process will raise questions as to how to protect both the Social Security numbers and the devices on which they are accessed, she said.

Ultimately, the U.S. in the future will likely move toward a federated identity system, where a user’s identity can be verified with biometric data like fingerprints and facial recognition that is linked across multiple systems, said Cliff Steinhauer, director of information security and engagement at The National Cybersecurity Alliance.
“There’s going to be a future where there’s a clean internet, where everyone that uses it has authenticated with this federated, proven identity so that nobody can pretend to be anybody else,” Steinhauer said.
The Social Security Administration’s move is a first step toward digital identification, though it does not appear to include biometric authentication, he said.
Because there will be risk for fraud, it will be important for the Social Security Administration to make sure its systems are properly protected, Steinhauer said. There should also be phishing-resistant authentication installed to ensure that only authorized individuals access the accounts, he said.
It will be important for individuals to verify that any messages that allegedly come from the Social Security Administration do, in fact, take them to a verified Social Security website.
Any messages the agency sends out, such as a reminder to log in and check an account, could be copied for phishing purposes, Steinhauer said. More