can walk across the street for more money, whether you can take on a side gig, but there are other things that you can do on the expense side too. in particular, look at your credit score. one of the big charges that people face is interest. and interest rates have gone up this year. if you re carrying variable rate credit card debt, we know it just ticked above a trillion dollars for consumers. your interest rate has probably gone up 6% this year. if you have a good credit score, transferring that balance to a lower rate credit card with you can pay it off quicker and cheaper is a good move. what about the differences between withdrawal trg your 401(k) versus taking a loan from your 401(k)? what are the differences there? when you withdraw, you are going to pay taxes on that money and may also be subject to a 10% penalty. these are hardship withdrawals. some of them are penalized, some are not.
for us. so it s up 3.2% over last july. doesn t seem like a good with news for our wallets, jonathan. no, no. that pork chop is going to cost you a little bit more, griff, indeed. look, inflation is up. vice president kamala harris has been wanting to take some victory lap ares about it but it s, unfortunately, going the other way. inflation up in july, up in uni, and it s been up since president biden was in office. prices are up about 16% since biden took office, wages are down by about 3%. and this is why three-quarters of americans, when polled, say they think the economy s in bad shape. you ve got record credit card debt that people are taking out ask and a 36% increase in what they call 401(k) hardship withdrawals. so if bidenomics is working, the average american certainly doesn t feel it. griff: when you really put your finger on i think what was the most significant thing, and that is if prices are generally up 16%, wages down 3%, you eventually run into that problem
Last year, a higher proportion of Americans with 401(k) accounts carried out hardship withdrawals emergency removal of funds from a retirement plan as many people financially struggled under decades-high elevated inflation rates.
so if we do go into a recession, likely will be shallow and short. but if we can t get control of inflation, particularly food and rent inflation, then our economy will sort of the consumer, which is two-thirds of the engine of our economy, will falter and then we could fall into something that makes a short shallow recession seem like a day, a walk in the park. sandra: really interesting, and this coming off also the report we just covered last hour, more and more people are tapping their 401(k) for hardship withdrawals, and that, too, is not a great sign. most should hold off as long as possible, right, bill? appreciate you joining us on that. really interesting perspective. thank you. thank you. john: sandra, a rodent rivalry making this groundhog day a little complicated. nick has that story live from fox weather. nick, what s going on? that s right, john. can you believe it we have
living and as well the rising interest rates which is why americans feel not so fond about the economy at this point. the two biggest concerns, cost of living and interest eights so, matt, how are we seeing that reflected? we are seeing some signs of financial stress. vanguard says the share of retirement savers who were taking money out of their 401(k) due to a financial hardship, that has hit the highest level since they started tracking in 2004. this vanguard survey suggests about 25,000 people in october alone took out so-called 401(k) hardship withdrawals. this is a sign of people need cash. they re having some trouble making ends meet. also we re seeing another reflection of the spike in interest rates which, of course, has driven up the cost to get a mortgage. it s impacted home values and so a recent report from research firm black knight says over 250,000 people who bought homes