Federal student loan borrowers affected by the wildfires ripping across Southern California have relief options if they’re worried about keeping up with their payments as they recover.

The same holds true for other people with education debt who find themselves grappling with extreme weather and climate disasters.

“Borrowers impacted by natural disasters may qualify for temporary relief from student loan payments,” said Carolina Rodriguez, director of the Education Debt Consumer Assistance Program, based in New York.

More from Personal Finance:
After the holidays comes ‘Returnuary’ 
Economists have ‘really had it wrong’ about recession
Trump tariffs would likely have a cost for consumers

It’s a good idea for borrowers to familiarize themselves with the relief available to them in case they should need it, experts said.

There was a record number — 28 — of billion-dollar disasters in the U.S. during 2023, including wildfires, droughts and tornados, according to the National Oceanic and Atmospheric Administration. By November of 2024, there were 24 confirmed weather and climate disaster events with losses also exceeding $1 billion each.

Here’s what federal student loan holders should know about their options during a natural disaster.

At Studentaid.gov, the Education Department says its federal student loan servicers check the Federal Emergency Management Agency website at least once each business day to identify all impacted areas connected to a disaster declaration.

In many cases, the U.S. Department of Education will automatically put qualifying borrowers into a natural disaster forbearance, Kantrowitz said.

“Borrowers generally do not need to apply for this,” he added. Still, borrowers who want to make sure their payments are paused might want to contact their loan servicer.

The natural disaster forbearance lasts for up to 90 days, according to the Education Department. In some cases, borrowers will be granted 30-day extensions. However, the forbearance can’t exceed 12 monthly billing cycles from the date of the disaster. (Loan interest continues to accrue during the payment pause.)

Meanwhile, those who want to decline the automatic natural disaster forbearance because they’re able to make their payments should contact the Education Department to do so.

Borrowers who are students at the time of a natural disaster may continue to qualify for an in-school deferment, Kantrowitz said, even if they’re not able to complete the school year.

If you’re in default on your student loans and impacted, you or a family member can contact the Education Department and request a three-month suspension of collection activity.

If you’ve lost any of your student loan records in a disaster, you can access the information through your Studentaid.gov account.

If the natural disaster is not federally-declared or borrowers aren’t deemed eligible for the forbearance for some reason, they can still request a temporary payment pause by applying for a general forbearance with their servicer, EDCAP’s Rodriguez said.

Borrowers should keep in mind that interest can continue to accrue on their debt during a forbearance, and that they might not get credit toward a debt forgiveness program while they’re not making payments, she added.

You’ll likely have fewer disaster relief options with your private student loans, Rodriguez said.

Still, she said, “it is essential to reach out to private lenders as soon as possible to explore available relief and prevent delinquency or default.”

Many Americans are starting 2025 a little worse off than before, at least when it comes to credit card debt.

Almost half of cardholders — 48% — now carry debt from month to month, according to a new report by Bankrate. That’s up from 44% at the start of 2024. Of those carrying balances, 53% have been in debt for at least a year.

Roughly 47% of borrowers said they carry a balance due to an unexpected or emergency expense, most commonly medical bills or car and home repairs. Others cite higher day-to-day expenses and general overspending.

“High inflation and high interest rates have been a nasty combination, and while the worst is behind us, the cumulative effects are significant and will linger,” Ted Rossman, Bankrate’s senior industry analyst, said in a statement.

More from Personal Finance:
After the holidays comes ‘Returnuary’ 
Economists have ‘really had it wrong’ about recession
Trump tariffs would likely have a cost for consumers

Overall, Americans’ credit card tab has continually crept higher. 

The average balance per consumer now stands at $6,380, up 4.8% year over year, according to the latest credit industry insights report from TransUnion from 2024’s third quarter.

By way of example: With annual percentage rates just over 20%, if you made minimum payments toward the average credit card balance ($6,380), it would take you more than 18 years to pay off the debt and cost you more than $9,344 in interest over that time period, Rossman calculated.

Meanwhile, 36% of consumers added to their debt load over the holiday season, according to a separate report by LendingTree.

Of those with debt, 21% expect it’ll take five months or longer to pay it off, LendingTree found. 

According to another report by WalletHub, 24% of Americans said they will need more than six months to pay off their holiday shopping debt. In that survey, most consumers said inflation caused them to spend more than they initially planned.

“Many people need months to repay holiday bills after overspending,” said John Kiernan, editor at WalletHub.

The best move for those struggling to pay down credit card debt is to consolidate with a 0% balance transfer card, Bankrate’s Rossman said.

“You could pay about $300 per month and knock out the average credit card balance in 21 months without owing any interest,” he said.

As it stands, 30% of credit cardholders expect to pay off their credit card debt within a year, while 41% expect to pay it off in 1 to 5 years, Bankrate also found. Another 13% expect it will take more than a decade.

Subscribe to CNBC on YouTube.

The rally in bitcoin and other cryptocurrency prices has generated excitement among some investors, but investment advisors are largely still skeptical that those volatile assets belong in a 401(k) plan or other qualified retirement savings plans.  

Crypto was one of the fastest-growing categories of exchange-traded funds in 2024. The most popular of these funds, the iShares Bitcoin Trust ETF (IBIT), has ballooned to over $50 billion in total assets.

Although crypto is a small part of the 401(k) plan market, it could grow substantially in 2025.

President-elect Donald Trump has suggested he will create a strategic reserve of bitcoin for the U.S. and has nominated Paul Atkins, a cryptocurrency advocate, to chair the Securities and Exchange Commission. The SEC’s approval of spot bitcoin and ethereum exchange-traded funds in 2024 was a key change for the industry. 

The law covering 401(k) plans requires plan sponsors to act as fiduciaries, or in investors’ best interest, by considering the risk of loss and potential gains of investments. The Labor Department has cautioned fiduciaries to exercise “extreme care” before adding crypto options to a 401(k) plan’s core investments. 

Labor Department officials, however, haven’t required fiduciaries to select and monitor all investment options, like those offered through self-directed brokerage windows, according to the Government Accountability Office. Nearly 40% of plans now offer brokerage windows in their 401(k) accounts, according to a 2023 survey by the Plan Sponsor Council of America. 

“With that said, investors need to ensure that they take their risk tolerance and time horizon into account which will define the target allocation,” said Johnson, who is also a member of the CNBC Financial Advisor Council. “The more volatile an asset class is, the less you need of it in the portfolio because you presumably get more bang for your buck.”

Johnson recommends cryptocurrencies range from 2% to 8% of an investor’s portfolio.  

Other experts point to volatility and risk as reasons to be conservative.

“People saving for retirement should probably be even more conservative, because adding crypto to a 401(k) plan would significantly increase the risk that your retirement nest egg could suffer a large loss at the wrong time,” said Amy Arnott, a chartered financial analyst and portfolio strategist with Morningstar Research Services.

Morningstar found that since September 2015, bitcoin has been nearly five times as volatile as U.S. stocks, and ether nearly 10 times as volatile. That type of volatility adds a large risk to a portfolio even with a small amount invested.

Regardless of what assets are in a 401(k) plan, there are limits to how much you can contribute. For 2025, an employee can contribute up to $23,500 in a 401(k) and other employer-sponsored plans — that’s $500 more than in 2024.

People age 50 or older can make a “catch-up contribution” of up to $7,500. And those age 60 to 63 years old can supersize that, with a catch-up contribution of up to $11,250 for 2025.

SIGN UP: Money 101 is an eight-week newsletter series to improve your financial wellness. For the Spanish version, Dinero 101, click here.