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Hi, welcome to The Weekly Scoop from Share Scoops, your trusted source for navigating the financial world.

We help keep you informed on everything that affects your work, home, and wallet.

Here’s what you need to know this week:

1️⃣ Layoffs are low.

2️⃣ Borrowing costs are staying high.

3️⃣ Credit card debt is becoming a problem for many.

4️⃣ It’s a challenging time to buy a home.

 💡Answers to common client questions about student loans.

Layoffs are still low, but it’s a competitive hiring market.

According to the Labor Department, initial jobless claims dropped to 207,000 for the week ending January 25, lower than economists expected and lower than pre-crisis averages. Relatively low layoff levels and unemployment rates indicate that most employers are holding onto their workers. Continuing claims, which show how many people received unemployment benefits for consecutive weeks, decreased slightly from the highest level in over three years. These numbers have been climbing steadily over the past year, showing that finding a new role is getting increasingly more challenging. Job seekers should expect longer search periods than in recent years, and everyone should be building their emergency savings.

Policymakers aren’t ready to make borrowing cheaper anytime soon.

The Federal Reserve decided to keep baseline interest rates steady in its January policy meeting at 4.25% to 4.5%. After quickly hiking borrowing costs in 2022 and 2023 to fight inflation by slowing borrowing and spending, the Fed reduced rates by a full percentage point last year. They felt comfortable that inflation had calmed down and wanted to avoid overly restricting business activity. While the cost of living isn't rising anywhere near as fast as it was a couple of years ago, it's still climbing.

The Fed plans to keep lowering interest rates this year but expects to do so slowly to avoid reigniting inflation. The economy seems to be avoiding a downturn for now, so the Fed is comfortable watching how things develop, especially given the uncertainty around taxes, government spending, and the potential impact of proposed tariffs on imported goods. This means borrowing costs for business loans, credit cards, mortgages, and auto financing could remain relatively high for the year ahead, making it challenging for consumers to manage debt or make big purchases.

More people are struggling with credit card debt.

The Philadelphia Federal Reserve reported that in the third quarter of 2024, 10.75% of active credit card accounts made just the minimum payment, the highest since 2012. Credit card delinquencies are up too, with 3.52% of cardholders more than 30 days past due, surpassing pre-pandemic levels. With average credit card interest rates over 21%, higher balances and rising rates are making it harder for consumers to pay down debt. If you have credit card debt, paying more than the minimum can help you avoid extra interest costs and reduce the time it takes to pay off your balances.

It’s a challenging time to buy a home.

Last year, the number of Americans selling their homes was the lowest in nearly 30 years. The National Association of Realtors reported that the number of resold homes rose 2.2% last month, the highest since February. However, the sales pace for the whole year was extremely low. Total sales for 2024 were just 4.06 million, the lowest since 1995. Low supply kept prices from falling. The median sale price of an existing house hit a record high of $407,500 last year. If you're considering buying a home, be prepared for fewer options, near-record prices, and high mortgage costs.

Common client questions this week: