Sunday, November 26, 2023
Journal: What’s going on with Personal Finance?

This past week in U.S. personal finance saw several significant developments. The Federal Reserve expressed a cautious approach toward achieving its inflation goals, hinting at continued interest rate adjustments. The holiday shopping season is witnessing a surge in 'Buy Now, Pay Later' (BNPL) with $17 billion expected to be generated, but consumer advocates warn about the risks of accumulating debt through this method. The IRS updated its tax brackets for 2024, reflecting current inflation levels, which could affect many taxpayers. Mortgage rates have hit 8% for the first time since 2000, impacting homebuyers and the real estate market. Additionally, personal loan rates have risen slightly, with a notable increase in 3-year and 5-year loans, suggesting tightened credit conditions.

For the upcoming week, U.S. personal finance trends to watch out for include further movements in mortgage rates, which have shown a trend of decline recently. This could be an opportunity for those looking to refinance or secure a mortgage. The FDIC announced a special assessment to rebuild its insurance fund after several bank failures, which might indirectly affect banking services. With the holiday season approaching, retailers face an inventory glut, potentially leading to aggressive discounting and an impact on inflation. Additionally, consumer debt balances and delinquency rates have risen, which could influence lending practices and consumer spending. These factors, combined with rising concerns over debt distress, as indicated by the National Foundation for Credit Counseling, suggest a cautious approach to personal finance management in the coming week.