FinanceWise Daily

Financial Hardship Letters Explained: How to Write One That Works in 2025 If you're facing financial difficulty—due to job loss, medical expenses, or inflation—you may need to write a financial hardship letter. These letters are essential when requesting relief from creditors, landlords, or lenders, especially as many Americans are still recovering from post-pandemic economic stress. What Is a Financial Hardship Letter? A financial hardship letter is a formal document explaining why you’re unable to meet a financial obligation and requesting temporary or permanent relief. In 2025, such letters are frequently used for mortgage forbearance, student loan deferment, credit card relief, or rent payment adjustments. Why It Matters in 2025 According to a CNBC report , U.S. household debt reached a new high this year, and more people are relying on financial hardship programs. Lenders are still willing to offer accommodations—but only when the request is well-documented and reaso...

Opening a Roth IRA for your child might sound premature—but in 2025, it’s becoming a smart financial move embraced by more American families. With rising concerns about the long-term sustainability of Social Security and increasing college costs, parents are turning to custodial Roth IRAs to give their kids a powerful head start on future wealth. In a recent CNBC report , financial advisors noted a surge in parents setting up Roth IRAs for children with part-time income. The key? Your child must have earned income from a job—babysitting, working retail, or helping in a family business all qualify. What Is a Roth IRA for Kids? A Roth IRA for a minor is a custodial account managed by an adult, typically a parent. Contributions are made with after-tax dollars and grow tax-free. When the child reaches 59½, withdrawals are tax-free as well—assuming the account has been open at least five years. Why It Matters in 2025 With inflation and tuition fees showing no signs of slowing down, ...

Do you know how much your bank really costs you each month? Even if you don’t pay monthly maintenance fees, hidden bank charges like overdraft fees, out-of-network ATM usage, and international transaction fees could be silently draining your account. Common Hidden Fees Banks Don’t Advertise Overdraft Fees: The average overdraft fee in the U.S. is still around $30 per transaction. In 2025, some major banks have reduced or eliminated them, but not all. ATM Fees: Using an ATM not affiliated with your bank can cost you $3 to $7 per transaction when both the ATM owner and your bank charge you. Foreign Transaction Fees: Many banks still charge up to 3% on purchases made overseas or from international websites. Recent Developments in the U.S. Banking Sector In May 2025, CNBC reported that a bipartisan Senate bill is pushing for stricter transparency on overdraft and maintenance fees. The proposal would require banks to clearly disclose all recurring and conditional charges...

How Much Should Be in an Emergency Fund in 2025? With inflation still outpacing wage growth and layoffs on the rise in some sectors, Americans are rethinking how much they truly need in their emergency funds. So, what’s the right amount in 2025? Latest Trends in Emergency Savings According to a recent MarketWatch article from June 2025, financial experts now recommend setting aside at least six to nine months’ worth of essential expenses , especially for freelancers or households with a single income. A Fidelity Investments survey also reports that 61% of Americans feel underprepared for financial emergencies, despite higher average savings during the 2020s. How to Calculate Your Emergency Fund Here’s a basic formula: Monthly essential expenses × 6 (or up to 12 if unstable income) Include rent/mortgage, food, insurance, utilities, and minimum debt payments Example: If your core monthly expenses are $2,500, a 6-month emergency fund would be $15,000. When 3 Months ...

Struggling to Repay Your Federal Student Loans in 2025? If you're falling behind on your federal student loan payments this year, you're not alone. According to the New York Federal Reserve's Q1 2025 report , more than 5 million borrowers are now 90 days or more past due, and the delinquency rate has jumped to over 8% . This marks a sharp increase following the end of pandemic-era relief programs. 1. Understand Your Loan Status First Visit your loan servicer or Studentaid.gov to confirm whether your loans are in good standing, deferment, forbearance, or default. Being proactive is key—ignoring missed payments can lead to credit score drops and even wage garnishment. 2. Enroll in an Income-Driven Repayment Plan (IDR) IDR plans adjust your monthly payments based on income and family size. The recently expanded SAVE plan may offer lower monthly payments and interest forgiveness if you qualify. These plans can prevent default and help stabilize your budget. 3. Explo...