February is the perfect time to check in on your financial goals and make sure you’re staying on track for the year. Whether it’s budgeting smarter, saving more, or planning ahead, building strong financial habits now can set you up for success all year long. In this edition, you’ll find practical tips and tools to keep your financial fitness in peak condition. Let’s get to it!
Home Financing
Buying This Year? It’s Time to Strategize
If buying your first home—or upgrading to a new one—is on your to-do list this year, you may be wondering what challenges and opportunities lie ahead. The good news? There are some changes on the horizon that could work in your favor.
As inflation continues to ease, the Federal Reserve has been gradually reducing interest rates. Many experts predict this trend will continue in 2025, with mortgage rates likely to follow suit, but perhaps at a slower pace than originally expected. The good news is that lower rates could mean more affordable monthly payments for future homeowners.
In some areas, the inventory of homes for sale is also increasing. States like New Jersey are seeing more homes hit the market as retirement-age homeowners move south to states like Florida. This shift could lead to more choices for buyers in select markets.
However, it’s not a full-fledged buyer’s market yet. Many regions still face higher prices and limited inventory, with many current homeowners holding on to their ultra-low mortgage rates—over 50% of mortgage holders have rates under 4%.
If you’re serious about buying a home this year, it’s time to strategize. Consider exploring areas just outside your ideal location or looking into planned new developments. Most importantly, get pre-qualified for a mortgage to understand your budget and start your journey with confidence.
Source: investopedia.com
Insurance
Is Your Auto Insurer Too Nosy?
If you’re currently driving with a mobile app or a plug-in device that tracks your driving habits, you may be sharing more data than you realize.
Earlier this month, the state of Texas filed a lawsuit against major insurer Allstate, alleging that the company is illegally collecting additional driver data through secretly embedded software. Texas’ Attorney General has accused Allstate and its subsidiary Arity of collecting trillions of miles’ worth of data from over 45 million customers and selling it to third parties.
While Arity (a data and analytics company) admits to collecting and analyzing “enormous amounts of data”, they also insist that they do this solely to make transportation smarter and safer for everyone.
Allstate isn’t the only auto insurer that offers tracking devices to customers in exchange for possibly lower, usage-based rates. Typically, these devices collect users’ driving habits, including braking and accelerating habits, how fast they drive, and even the times of day they drive. Some apps also track cell phone usage and penalize customers for texting while driving.
If you’re driving with a tracker app, such as Snapshot, SmartMiles or DriveEasy, you may want to contact your insurance company to discuss the types of data collected.
Source: insurancejournal.com
In the News
Why This Pesky Inflation Just Won’t Go Away
Recent Consumer Price Index (CPI) data reflects a mixed picture of inflation, with some positive signs but continued pressure on household budgets.
Energy costs remain a concern for many. The gasoline index rose 5.3% last month, and fuel oil increased by 4.7%, keeping heating costs elevated. Electricity prices also edged up by 0.5%, reversing some earlier declines.
Grocery prices have shown only a slight overall increase of 0.4%, but specific items tell a different story. For example, supply chain issues and reduced crop yields have led to a 4.1% spike in vegetable prices, making them one of the highest-rising categories.
There is some relief, however. Prices for personal care items, communication services, and some household goods have decreased, providing minor savings for consumers. While inflation has slowed compared to its peak, the path to stability remains uneven.
Staying informed and adjusting your budget to reflect these trends can help manage the current economic landscape.
Credit and Consumer Finance
Medical Debts Leaving Millions of Credit Reports
Recently, the Consumer Financial Protection Bureau (CFPB) announced that medical debts will be removed from around 15 million consumer credit reports. This is expected to increase affected credit scores by an average of 20 points.
The CFPB says its research found that outstanding health care claims are a poor predictor of someone’s ability to repay a loan. The agency also found that outstanding medical bills disproportionately affects people of color.
While this ruling’s good news, future medical bills can still pose a major problem, even for those with insurance coverage. Here are some ways to manage them:
Determine if you qualify for charity care. Federal law requires nonprofit hospitals to adjust bills according to a patient’s household income.
File an appeal under the provisions of the No Surprises Act. This is a federal law that says insurance companies must reasonably cover any out-of-network services related to emergency and some non-emergency medical care. If you’re being charged more than expected for in-network services, the bill may actually be illegal.
Source: apnews.com
Did You Know?
What To Expect from Certified Pre-owned Vehicles
If you’re shopping for a new vehicle but on a budget, you may want to consider a certified pre-owned or CPO model. Here’s what you can expect if you go this route.
CPO vehicles are used cars and trucks that have been tested and inspected by their seller, usually a dealer or manufacturer of the same makes and models. Generally, these come with an extended warranty and a lower price than a brand-new model.
Sellers have their own set of requirements for their CPO program, although they all tend to include:
- Mileage and age limits
- Inspection standards
- Warranty coverage
For example, Lincoln vehicles undergo a 200-point inspection before being offered as a CPO while Genesis models are checked against 191 types of criteria. Other brands may not share the exact details of their CPO program.
Dealerships aren’t the only sources of CPO vehicles. You may find them at third-party auto sellers, and even retailers like Costco. Exploring several options means that you can compare prices, inspection criteria and warranty coverages to get the right ride at the right price.
Source: kiplinger.com