Quick take

• The 30-year mortgage rate hit 6.71%, up from 6.04% a year ago. Ralph doesn't expect it to drop back into the 4-5% range anytime soon.
• A regular savings account earning 0.4% can cost you hundreds of dollars a year compared to a high-yield account or CD.
• A CP2000 notice from the IRS is not an audit. It's an automated mismatch letter, and you have 30 days to respond.
• The 1099 reporting threshold moved from $600 to $2,000, but you still owe tax on every dollar of income whether or not you get a form.
• Authorized users on a credit card are generally not responsible for that debt after the cardholder dies.

Why are mortgage rates going up right now?

The 30-year fixed mortgage rate climbed to 6.71% this week, its highest point in more than a year and well above the 6.04% it sat at twelve months ago. Ralph put it in plain terms: lenders typically cap your mortgage payment at 28% of gross monthly income, so as the rate climbs, the loan amount you qualify for shrinks with it. He's not expecting the Fed to bring rates back down to the 4-5% range anytime soon, and pointed out that Federal Reserve governors have already discussed raising rates further at their September meeting.

What class action settlements are open right now?

Three settlements have deadlines this month. A cookware brand is paying $6 per pan or $12 per household with no receipt required, though it's limited to buyers in California and Colorado. Google Play and O'Reilly Auto Parts both close their settlement windows on September 14 and 28. Ralph's rule for these: verify through the official court-appointed administrator's website, never pay a fee to file a claim, and never hand over your full Social Security number to collect a payout.

What does the new $2,000 1099 threshold mean for freelancers?

The reporting threshold for 1099-NEC forms jumped from $600 to $2,000 per person, per year. Businesses won't have to issue a 1099 unless they paid someone more than that. Here's the trap for freelancers and gig workers: no 1099 doesn't mean no tax owed. You're still required to report every dollar you earned, form or no form. Ralph's advice is to open a separate bank account for gig income, run every expense through it, and set aside 25-30% of every dollar for taxes.

Should you move money out of a low interest savings account?

Dana from Ohio wrote in with $15,000 sitting at 0.4% interest. Ralph ran the numbers: at 0.4%, that balance earns $57 a year.

An 18-month CD at 4.25% would earn $637.50, but it locks the money up. Ralph's recommendation was to keep one month of expenses fully liquid, then ladder the rest across three, six, and twelve-month CDs so a chunk becomes available every few months.

What does a CP2000 notice from the IRS actually mean?

Marcus from Pennsylvania got a CP2000 notice claiming he owes $3,200 for an unreported 1099 from 2024. First thing Ralph told him: this is not an audit. It's an automated notice the IRS sends when what you reported doesn't match what employers, banks, and clients reported on your behalf. Marcus has 30 days to agree, partially agree, or dispute the amount. If he had business expenses against that 1099 income, Ralph noted, filing an amended return with a Schedule C could bring the number down significantly. Ignore the notice, though, and it can convert into a statutory notice of deficiency, at which point the proposed amount becomes final.

Do you have to pay a parent's credit card debt after they die?

Yvonne from Michigan is fielding collection calls over $9,000 in credit card debt her late mother left behind. She was an authorized user on one of the cards, not a cosigner, and that distinction matters. Authorized users generally aren't on the hook for a deceased cardholder's debt. That debt belongs to the estate, and if the estate can't cover it, it typically goes unpaid rather than landing on family, unless someone cosigned, was a joint account holder, or lives in a community property state. Ralph also pointed out that 70% of people don't have a will, which is often exactly what turns a situation like Yvonne's into a mess.

Got a money question?

Send it to us at becomingfinanciallyconfident.com and we'll tackle it on a future show.