• Home
  • Personal Finance
  • Investing
  • Business
  • Career
  • Consumer
  • Debt
  • Lifestyle
  • Retirement
  • Taxes

Personal Finance News

Latest News About Personal Finance

  • Blogger Net Worths
  • Top Personal Finance Blogs
  • Blogroll

Debt Management

36% Earning $100,000 or More Living Paycheck to Paycheck

June 16, 2022 Leave a Comment

Thirty-six percent of U.S. employees with salaries of $100,000 or more are living paycheck to paycheck — twice as many who said they were in 2019, according to a survey conducted by Willis Towers Watson, a consulting firm. CNBC reports:

That’s more than the 34% of workers who earn $50,000 to $100,000 a year who are living paycheck to paycheck, though lower than the 52% of paycheck-to-paycheck workers with incomes of less than $50,000, according to the survey.

However, the high earners are the only group that saw an increase in their paycheck-to-paycheck ranks in the last three years.

“Employees at higher pay levels aren’t immune to living paycheck to paycheck,” said Mark Smrecek, the financial wellbeing market leader for North America at Willis Towers Watson.

Willis Towers Watson polled 9,658 full-time employees from large and midsize private employers in December and January 2022, before the most recent inflation readings.

Two-Thirds of Americans Live Paycheck to Paycheck

May 11, 2022 Leave a Comment

With inflation still near 40-year highs, close to two-thirds of Americans are living paycheck to paycheck. Inflation is showing no signs of slowing down, making it harder for workers to make ends meet. CNBC reports:

As of March, close to two-thirds, or 64%, of the U.S. population was living paycheck to paycheck, just shy of the high of 65% in 2020, according to a LendingClub report.

“The number of people living paycheck to paycheck today is reminiscent of the early days of the pandemic and it has become the dominant lifestyle across income brackets,” said Anuj Nayar, LendingClub’s financial health officer.

Consumers who are struggling to afford their day-to-day lifestyle tend to rely more on credit cards and carry higher monthly balances making them financially vulnerable, the survey of more than 2,600 adults found.

Financially Hobbled for Life: The Elite Master’s Degrees That Don’t Pay Off

July 9, 2021 Leave a Comment

Columbia and other top universities push master’s programs that fail to generate enough income for graduates to keep up with six-figure federal loans. The Wall Street Journal reports:

Recent film program graduates of Columbia University who took out federal student loans had a median debt of $181,000. Yet two years after earning their master’s degrees, half of the borrowers were making less than $30,000 a year. The Columbia program offers the most extreme example of how elite universities in recent years have awarded thousands of master’s degrees that don’t provide graduates enough early career earnings to begin paying down their federal student loans, according to a Wall Street Journal analysis of Education Department data. Recent Columbia film alumni had the highest debt compared with earnings among graduates of any major university master’s program in the U.S., the Journal found. The New York City university is among the world’s most prestigious schools, and its $11.3 billion endowment ranks it the nation’s eighth wealthiest private school.

For years, faculty, staff and students have appealed unsuccessfully to administrators to tap that wealth to aid more graduate students, according to current and former faculty and administrators, and dozens of students. Taxpayers will be on the hook for whatever is left unpaid. Lured by the aura of degrees from top-flight institutions, many master’s students at universities across the U.S. took on debt beyond what their pay would support, the Journal analysis of federal data on borrowers found. At Columbia, such students graduated from programs including history, social work and architecture. Columbia University President Lee Bollinger said the Education Department data in the Journal analysis can’t fully assess salary prospects because it covers only earnings and loan repayments two years after graduation. “Nevertheless,” he said, “this is not what we want it to be.”

At New York University, graduates with a master’s degree in publishing borrowed a median $116,000 and had an annual median income of $42,000 two years after the program, the data on recent borrowers show. At Northwestern University, half of those who earned degrees in speech-language pathology borrowed $148,000 or more, and the graduates had a median income of $60,000 two years later. Graduates of the University of Southern California’s marriage and family counseling program borrowed a median $124,000 and half earned $50,000 or less over the same period. “NYU is always focused on affordability, and an important part of that is, of course, to help prospective students make informed decisions,” said spokesman John Beckman. Northwestern spokeswoman Hilary Hurd Anyaso said the speech-language pathology program is among the best in the world, leading to a “gratifying career path that is in high demand.” USC spokeswoman Lauren Bartlett said providing students financial support and employment opportunities was a priority for the school.

Billionaire CEO of Software Company Indicted For Alleged $2 Billion Tax Evasion Schemes

October 16, 2020 Leave a Comment

The billionaire chief executive of Ohio-based Reynolds and Reynolds Co, Robert Brockman, has been indicted on charges of tax evasion and wire fraud conducted over “decades.” ZDNet reports:

The scheme, in which roughly $2 billion was hidden away in offshore accounts and through money laundering, took place between 1999 and 2019, the US Department of Justice (DoJ) said on Thursday. According to the indictment (.PDF), the resident of both Houston, Texas, and Pitkin County, Colorado allegedly used a “web” of offshore organizations in Bermuda and Nevis to hide the profits he made from investments in private equity funds. 

Brockman squirreled away his capital gains and also tampered with the evidence of his alleged activities, prosecutors say, by methods including backdating records and using “encrypted communications and code words” to communicate with co-conspirators, including the phrases “Permit,” “King,” and “Redfish.” A ranch, luxury home, and yacht were among the purchases apparently made with non-taxed income. US prosecutors also say that between 2008 and 2010, Brockman used a third-party entity to purchase $67.8 million in debt securities from the software company. As CEO, the executive is not permitted to do so without full disclosure as it can have an impact on share prices and trading; however, Brockman allegedly did so without informing sellers. 

As a result, approximately $2 billion in income was kept hidden from the US Internal Revenue Service (IRS). In addition, US prosecutors allege that investors in the software firm’s debt securities were also defrauded. A federal grand jury in San Francisco, California has issued a 39-count indictment, including seven counts of tax evasion, 20 counts of wire fraud, money laundering, evidence tampering, and destruction of evidence.

The Average American Has $90,460 in Debt

October 16, 2020 Leave a Comment

Debt

In our efforts to keep up with the Joneses (or just get by during this period of economic uncertainty, debt has become a normalized part of the American lifestyle. CNBC reports:

Borrowing money is often an important part of a long-term financial plan, whether it’s to access education and career opportunities, buy a car for your commute or find a place to call home.

However, debt also involves a little risk and can be expensive. Not only do you pay interest fees, borrowing of any kind requires you to make your payments on time in order to keep your account and credit score in good standing. It’s not uncommon for consumers to make a few common mistakes while learning how credit works and establishing lifelong money habits.

That’s why knowledge is important: Using 2019 data from credit bureau Experian, we looked at how much debt the average American has at every stage of their lives, breaking it down by total balance(s) and type, so you can get a big-picture view of how much Americans are borrowing, and why.

While the average American has $90,460 in debt, this includes all types of consumer debt products, from credit cards to personal loans, mortgages and student debt.

Knowing these trends is important. Along with staying informed about financial planning, reading advice about saving for retirement and learning credit card basics — knowing where you stand can help you decide where to go next on your financial journey.

20-Year-Old Robinhood Customer Dies By Suicide After Seeing A $730,000 Negative Balance

June 18, 2020 Leave a Comment

Worst Mistakes Investors Make

The note found on his computer by his parents on June 12, 2020, asked a simple question. “How was a 20 year old with no income able to get assigned almost a million dollars worth of leverage?” The tragic message was written by Alexander E. Kearns, a 20-year-old student at the University of Nebraska, home from college and living with his parents in Naperville, Illinois. Earlier that day, Kearns took his own life. Forbes reports:

Like so many others, Kearns took up stock investing during the pandemic, signing up with Millennial-focused brokerage firm Robinhood, which offers commission-free trading, a fun and easy-to-use mobile app and even awards new customers free shares of stock. During the first quarter of 2020, Robinhood added a record 3 million new accounts to its platform. As the Covid-19 stock market swung wildly, Kearns had begun experimenting, trading options. His final note, filled with anger toward Robinhood, says that he had “no clue” what he was doing. 

In fact, a screenshot from Kearns’ mobile phone reveals that while his account had a negative $730,165 cash balance displayed in red, it may not have represented uncollateralized indebtedness at all, but rather his temporary balance until the stocks underlying his assigned options actually settled into his account.

Kearns apparently fell into despair late Thursday night after looking at his Robinhood account, which appeared to have $16,000 in it but also showed a cash balance of negative $730,165. In his final note, seen by Forbes, Kearns insisted that he never authorized margin trading and was shocked to find his small account could rack up such an apparent loss. 

Quarter Of Americans Have No Emergency Savings In Age Of Coronavirus

April 3, 2020 Leave a Comment

The U.S. economy is currently facing its toughest challenge since the Great Depression, and millions of Americans suddenly find themselves out of work. Financial experts have long advised people to build a savings account for emergencies, but it’s fairly safe to say that no one saw a widespread economic emergency of this scale coming. We’re all scrambling to adapt, but a new survey is illustrating just how bad the situation is for many Americans. Studyfinds reports:

A total of 1,100 Americans were polled, and one in four (25%) said they don’t have any emergency savings at all. Another 23% only have enough to get by for three weeks. While there is some help on the way in the form of $1,200 government stimulus checks, 42% said they’ll have to immediately spend that money on bare essentials like groceries.

The survey, commissioned by GOBankingRates, also came to a number of other financial findings. Perhaps one of the most eye-opening is the revelation that two-thirds of Americans have either already been financial burdened by the coronavirus crisis (36%) or expect to be soon (28%).

Coronavirus Reveals Financial Irresponsibility of Americans

March 23, 2020 Leave a Comment

How long could you sustain your household if you were to stop earning income? If you are like most Americans, the answer is not for long. Only 40 percent of Americans can afford an unexpected $1,000 expense with their savings. The Hill reports:

In fact, nearly 80 percent of workers are living paycheck to paycheck. It is no surprise that the probability of an economic recession brought on by the coronavirus pandemic caused many to worry.

In major cities such as Boston, New York, Los Angeles, and San Francisco, restaurants and businesses have been ordered to close. For many hourly workers, this means no paychecks in the coming weeks. Almost one in five Americans have already lost their jobs or have reduced hours. At the same time, salaried workers are concerned about job security, as mass layoffs at numerous companies loom. While the situation is understandably stressful for every person affected, it serves as a sobering reminder that Americans must learn to live within their means and regularly save money.

The need for all Americans to be able to sustain themselves for at least a few months on savings is accentuated during a time of crisis. This means planning ahead when times are good.

Trump to Waive Interest on Federal Student Loans ‘Until Further Notice’

March 14, 2020 1 Comment

President Donald Trump on Friday said that he wouldeliminate the intereston federal student loans “until further notice” as part of a package of emergency executive actions designed to address the economic fallout from the coronavirus pandemic. Politico reports:

The unprecedented move will provide relief to the more than 42 million Americans who owe more than $1.5 trillion in outstanding federal student loans…

It’s not clear how much money the interest waiver will save borrowers, but it could be billions of dollars, depending on how long the Trump administration keeps the policy in place. In fiscal 2019 alone, the Education Department reported that it charged more than $100 billion in interest on all federal student loans…

The Education Department on Friday was still determining the mechanics of how to carry out Trump’s announcement.

U.S. Household Debt Exceeds $14 Trillion for the First Time

February 12, 2020 Leave a Comment

Debt

Total U.S. household debt rose by $601 billion in the fourth quarter from a year earlier, or 1.4%, surpassing $14 trillion for the first time, the New York Fed’s quarterly household credit and debt report showed. Bloomberg reports:

That’s $1.5 trillion above the previous peak in the third quarter of 2008. Overall household debt is now 26.8% above the second-quarter 2013 trough.

Mortgage borrowing rose by $120 billion to $9.56 trillion. The rate for a 30-year mortgage has fallen by about 100 basis points over the past year, adding to home purchasers’ buying power. For example, a $500,000, 30-year loan costs about $300 less per month.

“Mortgage originations, including refinances, increased significantly in the final quarter of 2019,” Wilbert Van Der Klaauw, vice president at the New York Fed, said in a statement.

Over 40% of Americans Don’t Have $1,000 for an Emergency!

January 22, 2020 Leave a Comment

Many of us would be in trouble if we had to foot the bill for an unplanned expense. Bankrate’s January Financial Security Index survey reveals that just four in 10 U.S. adults (41 percent) would cover the cost of a $1,000 car repair or emergency room visit using savings. Bankrate reports:

The findings echo what previous Bankrate studies and others — including the Federal Reserve and the Pew Charitable Trusts — have found about Americans’ lack of rainy-day savings.

The higher your household income, the more likely you would be to use savings to pay for unanticipated costs. That’s true for nearly six in 10 (59 percent) households earning $75,000 or more annually.

Men (45 percent) were more likely than women (38 percent) to say they would draw from savings when faced with the unexpected. And when their backs are against the wall, just 36 percent of younger millennials would turn to emergency funds to pay $1,000 (compared with 41 to 44 percent of older folks who would say the same).

A $45,000 Loan for a $27,000 Ride: More Borrowers Are Going Underwater on Car Loans

November 9, 2019 Leave a Comment

John Schricker took out a loan to buy a car in 2017. Then he took out another. And then another. In two years, the 40-year-old electrician signed up for four auto loans, each time trading in the previous car and rolling the unpaid balance into the next loan. He recently bought a $27,000 Jeep Cherokee with a $45,000 loan from Ally Financial Inc. The Wall Street Journal reports: 

Consumers, salespeople and lenders are treating cars a lot like houses during the last financial crisis: by piling on debt to such a degree that it often exceeds the car’s value. This phenomenon—referred to as negative equity, or being underwater—can leave car owners trapped.

Some 33% of people who traded in cars to buy new ones in the first nine months of 2019 had negative equity, compared with 28% five years ago and 19% a decade ago, according to car-shopping site Edmunds. Those borrowers owed about $5,000 on average after they traded in their cars, before taking on new loans. Five years ago the average was about $4,000.

Rising car prices have exacerbated an affordability gap that is increasingly getting filled with auto debt. Easy lending standards are perpetuating the cycle, with lenders routinely making car loans with low or no down payments that can last seven years or longer.

US Debt Surpasses $23 Trillion for First Time

November 2, 2019 Leave a Comment

The federal government’s outstanding public debt has surpassed $23 trillion for the first time in history, according to data from the Treasury Department released on Friday. The Hill reports: 

Growing budget deficits have added to the nation’s debt at a speedy rate since President Trump took office. The debt has grown some 16 percent since Trump’s inauguration, when it stood at $19.9 trillion. It passed $22 trillion for the first time just 10 months ago.

Of the $23 trillion figure, just under $17 trillion was in the category of debt held by the public, which is a more useful gauge of the debt the government has to pay down, and the number typically used in calculating the nation’s debt burden. The other $6 trillion comes from loans within government bodies.

Still, the $23 trillion figure marks a milestone.

America’s Middle Class Is Addicted to a New Kind of Credit

October 29, 2019 Leave a Comment

Debt

It’s called the online installment loan, a form of debt with much longer maturities but often the same sort of crippling, triple-digit interest rates. Bloomberg reports: 

If the payday loan’s target audience is the nation’s poor, then the installment loan is geared to all those working-class Americans who have seen their wages stagnate and unpaid bills pile up in the years since the Great Recession.

In just a span of five years, online installment loans have gone from being a relatively niche offering to a red-hot industry. Non-prime borrowers now collectively owe about $50 billion on installment products, according to credit reporting firm TransUnion. In the process, they’re helping transform the way that a large swathe of the country accesses debt. And they have done so without attracting the kind of public and regulatory backlash that hounded the payday loan.

“Installment loans are a cash cow for creditors, but a devastating cost to borrowers,” said Margot Saunders, senior counsel for the National Consumer Law Center, a nonprofit advocacy group.

For many families struggling with rising costs and stagnant wages, it’s a cost they’re increasingly willing to bear.

Average Millennial Has $27,900 In Debt

September 17, 2019 Leave a Comment

Millennials by ITU Pictures

Millennials carry an average of $27,900 in debt, not including mortgages, according to new data released today by Northwestern Mutual. Gen Z, the oldest of whom are now 22 years old, have an average debt of $14,700. Buzz Feed News reports: 

Having sizable debt at a young age “is the new normal,” said Chantel Bonneau, wealth management advisor at Northwestern Mutual. “There are lots of people who exit school, and before they start their first job, have debt. That is a different situation from 30 years ago.”

Millennials’ main source of debt is credit card bills, and Gen Z’s is student loans. In a previous poll by CreditCards.com, 40% millennials said the top reason they carried a credit card balance was daily expenses such as groceries, childcare, and utilities, and about 20% pointed to unexpected emergencies such as medical bills and car repairs. Bonneau said discretionary expenses such as vacations and eating meals out also contribute to credit card debt.

About 45% of millennials and 43% of Gen Z reported feeling guilty about their debt at least every month — more than other age groups. But debt is a major stressor across age groups. One-fifth of all respondents said their debt made them physically ill at least monthly, 45% said it made them anxious at least monthly, and 35% said they felt guilty once a month or more.

  • 1
  • 2
  • 3
  • …
  • 7
  • Next Page »

Must Read

  • What's the Recommended Temperature for Vacant Home in Winter?
  • Professional Panda Cuddler as the World's Best Job for $32,000 per Year
  • How to Refinance a Paid Off Car
  • How to Reach a Live Person at IRS to Resolve Tax Problems
  • How to Cash Out Pension Plan Early
  • 401(k) Balances Hit a New All-Time High
  • 61% Now Living Paycheck to Paycheck
  • 36% Earning $100,000 or More Living Paycheck to Paycheck
  • Amazon Cash: Now You Can Pay With Cash on Amazon
  • Losses To Romance Scams Reached a Record $304 Million in 2020

Recent Posts

  • More Americans Are Using ‘Buy Now, Pay Later’ Services To Pay for Groceries
  • 5 Tips To Get The Best Value On An Insurance Policy
  • 61% Now Living Paycheck to Paycheck
  • 36% Earning $100,000 or More Living Paycheck to Paycheck
  • Two-Thirds of Americans Live Paycheck to Paycheck
  • The Hit to Your Pocketbook From Higher Gasoline Prices: $2,000 a Year
  • Uber Now Lets You See How Many One-Star Ratings You Received From Drivers
  • Survey: 7 In 10 Americans Living Paycheck To Paycheck

Connect With Us

  • Facebook
  • Twitter
Home · About · Terms · Privacy · Contact · Copyright © 2023 · Personal Finance News