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| Stat Of The Day |
| $1.17 Trillion |
Are you sitting down? Total credit card debt rose to $1.17 trillion in Q4 of 2024 according to recent data from the Fed. That’s a $24 billion surge from the quarter before and the highest level ever recorded. We’ve been sounding the alarm on America’s debt dilemma for a while now. And, let’s be real – if you’re reading this, there’s a good chance you might be feeling the financial squeeze. More people than ever before are paying only the minimum.
Here’s the truth: Getting out of debt and getting your finances in order isn’t about hopping on the latest "no buy 2025" trend, or other challenges that limit your spending to just the essentials. Much like a crash diet, these quick fixes might get you some temporary results, but rarely last. The bad habits usually come creeping back in and you end up worse off than when you started.
What does work? A method that allows you to build good money habits that actually stick, like FinanceFixx, HerMoney’s 4-week money makeover program. With FinanceFixx, you’ll work one-on-one with a certified coach and alongside a small group of women who are all in this together. You’ll track your cash, set spending limits and actually grow your savings.
Our next session kicks off February 5th and seats are filling up fast. Snag yours here and use code SAVENOW for a special discount. |
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| This Week In Your Wallet |
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It’s officially tax season. If you’re looking to get your refund as quickly as possible, there are hacks for that. According to the IRS, "If you’re eager for your refund, the best way to speed up the process is by filing electronically and picking direct deposit for your payment." As CNBC reports, those who do so will typically see their refund within 21 days. Another tip? Make sure your return is "complete and accurate," as any errors can hold up your refund. "Some common tax return errors include missing or inaccurate Social Security numbers, misspelled names, entering information wrong, and math mistakes," notes CNBC.
If you own tech stocks, like Nvidia, this week has probably left you a bit rattled. Here’s the skinny: A Chinese AI company called DeepSeek is gaining some significant traction and causing stocks in the AI sector to slide. As CNN reports, DeepSeek seems to do what other AI companies do at a much lower cost. What impact will DeepSeek have long term? There are differing views in the market, with some saying it will actually end up being a good thing for tech stocks. That said, we’ll have to wait and see. PS, if you want to take a deeper dive into what DeepSeek could mean for the markets, join us (for free!) at the next session of InvestingFixx, our investing club for women, on February 3rd.
Spending more? Your emotions could be to blame. There are four emotions that could cause you to splurge. One of them? Excitement. Financial therapist Amanda Clayman says the excitement of shopping is actually the anticipation of gaining something, whether that’s anxiety relief or a rise in social credibility. Sales can kick many people into excitement overdrive – and when that happens, it’s key to know how to keep your emotions (and budget) in check. If you notice yourself getting a *little* too excited about your favorite store having a sale, remember HerMoney CEO Jean Chatzky’s money rule – even if it’s 50% off, it’s still 50% on. |
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| Things That Save You Money |
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Who needs a $50 Stanley? As The Takeout suggests, you can upcycle the lids of parmesan cheese bottles by adding them to mason jars to make DIY to-go cups. Just make sure to give them an extra good rinse. |
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Bye-bye, Bezos. "Last year while everyone did dry January I did dry Amazon," says Kim, a member of HerMoney’s private Facebook group. "I’m doing it again this year and am now seriously contemplating dropping Amazon all together - it’s such a money suck for me." |
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Is Costco the new Lululemon? Some think so, and say their activewear dupes are just as good as the real deal. |
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| Ask Jean |
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| Q: |
I have almost $20,000 in credit card debt. I pay really high APR fees – is there any way to lower them? |
| A: |
As we explained at the top of this newsletter, credit card debt in the U.S. hit record highs recently. Interest rates are also up there – with those associated with retail cards setting records recently, too.
The very first thing you’re going to want to do is take a good, hard look at your budget and identify what expenses you can cut. As HerMoney’s Kathryn Tuggle recently wrote, some costs (subscriptions, wireless) may be able to be canceled or renegotiated. Others (take-out, entertainment) may be able to be trimmed. The goal is to come up with an amount you can put toward your credit card debt on a monthly basis.
Now, on to lowering your interest rates. One way you could potentially lower the amount you’re paying in interest is through a balance transfer, which is where you would move your credit card debt from one card to another. The goal is that the card receiving the balance would have a lower interest rate — ideally 0% — and you’d pay off the balance before that no-interest period ends (which is usually anywhere from six to 18 months, but you need to read the fine print to make sure.) The goal is that you fully pay off your debt balance before you lose that low interest rate, allowing you to get out of debt faster — that’s because each payment you make will go directly to chip away at your balance, not towards interest. One caveat: Balance transfer cards typically charge a fee of about 3% of the balance you’re moving. Make sure you stand to save more than that.
As you mentioned, you could also try to call your credit card issuer and ask for a reduced APR. If you’re a customer who is in good standing, many credit card issuers will lower your interest rate a few points just for asking, Thomas Nitzsche, Senior Director of Media for Money Management International, a nonprofit credit counseling agency, tells HerMoney.com.
The real key to lower rates? Boosting your credit score. Here’s how to increase yours. |
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| Submit your questions to Jean here. |
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