7 Rule Changes in 2023 That Impact Your Wallet

Key Takeaways

  • Regulators cracked down on junk fees and proposed rules that could make it easier to share your personal data when you’re shopping for better banking services.
  • Holding retirement advisors accountable for best-interest advice and changes to Social Security rules could impact your retirement savings.
  • Proposed changes to how credit card transactions are processed and tax credits for purchase of electric vehicles could generate savings for consumers.
  • A ban on non-compete clauses affects wages and employability.
  • The Biden Administration is working on ways to provide relief to student loan borrowers after repayments for their debt began in October this year.

Policy and rule changes by government agencies often grab headlines but may have far-reaching consequences for your wallets.

Here are some of the most significant rule changes—enacted and proposed—from the Consumer Financial Protection Bureau (CFPB), President Joe Biden’s administration, the Internal Revenue Service (IRS) and more for 2023 that are set to impact your finances in the coming year.

Personal Financial Data Rights Rule (CFPB)

A new Personal Financial Data Rights rule proposed by the CFPB on Oct. 19, seeks to increase competition in the financial sector and allow consumers to share bank account information more easily when shopping for better rates and lower fees. This proposal is in a notice-and-comment period that ends on Dec. 29.

Why It Matters: If this rule goes into effect, customers will benefit in more than one way. First, they will find it easier to look for options for better service by directing their banks to share personal data with other providers. Not only that, banks will not be allowed to charge any additional or junk fees to share this information.

Credit Card Competition Act (Congress)

The Credit Card Competition Act of 2023 (CCCA) is a bipartisan bill that aims to increase competition in the credit card industry by requiring large banks to allow more than one payment network to process credit card transactions. The bill was introduced into Congress on June 7. It awaits consideration by committee before a possible future vote in the House or Senate.

Why It Matters: Proponents say the bill would reduce merchants’ operating costs, lowering consumer prices. Opponents say merchants would retain the savings and credit card companies would reduce rewards.

Fiduciary Rule of 2023 (Department of Labor)

The U.S. Department of Labor (DOL) proposed a new fiduciary rule on Oct. 31, requiring retirement advisors to act in the best interests of their clients—in other words, as fiduciaries. The proposed rule is in a public comment period that ends Jan. 2, following which the DOL plans to implement the rule.

Why It Matters: Under the new rule, anyone who provides investment advice or recommendations would be defined as an investment advice fiduciary. This includes advice concerning rolling assets out of employer-sponsored plans. All this spells financial security, not to mention higher returns, for retirement investors.

Rule on Unfair or Deceptive Fees (Federal Trade Commission)

The Federal Trade Commission (FTC) on Oct. 11 proposed a rule to ban junk fees. The rule would require companies to stop charging hidden or misleading fees, show the total price upfront and disclose whether fees are refundable. The comment period for this rule is open until Jan. 8.

Why It Matters: According to the FTC, junk fees cost consumers tens of billions annually. According to the CFPB, almost two-thirds of banks have eliminated non-sufficient fees since 2021 after regulatory scrutiny, saving customers about $2 billion a year.

Ban on Non-Compete Clauses (Federal Trade Commission)

The FTC proposed a ban on non-compete clauses in employment contracts on Jan. 5.

A non-compete clause restricts employment options for former employees and can devastate wages and employability. The Federal Trade Commission (FTC) is expected to vote on a final rule to ban non-compete agreements in employment contracts in April.

Why It Matters: The FTC estimates the proposed rule could increase wages by nearly $300 billion annually. Opponents say a total ban on non-compete clauses would provide little protection to employers and expose trade secrets.

Credits for New Clean Vehicles Purchased in 2023 or After (IRS)

As of April 18, 2023, if you purchase a new plug-in electric vehicle (EV) or fuel cell vehicle (FCV), you may qualify for a clean vehicle tax credit of up to $7,500. The amount you qualify for depends on the vehicle’s MSRP, final assembly location, battery component and/or critical minerals sourcing, and your modified adjusted gross income (AGI).

Why It Matters: This rule comes as a part of the Biden Administration’s clean energy push. Electric vehicles are often considered more expensive than gas-powered cars, and this credit could go some distance in helping buyers make a decision.

Student Loan Repayment Rules (Biden Administration)

Following the Supreme Court’s rejection of President Joe Biden’s latest student loan forgiveness plan on June 30, the Department of Education initiated a new income-driven repayment plan known as the Saving on a Valuable Education (SAVE) program.

Meanwhile, the Biden administration began moving forward on a new plan to cancel some student debt. The plan, still in development, will be announced sometime in 2024. Meanwhile, student loan debt relief remains in “stay tuned” mode.

Why It Matters: Millions of borrowers will see their monthly payments cut in half under the SAVE plan, which will get more generous in 2024. Biden’s second attempt at forgiving student debt will likely be challenged in court yet again but could impact the wallets of up to 43 million student loan borrowers if successful.

link