President Joe Biden made some big promises on his way to the Oval Office. Here’s how he's doing on a few major money issues and what they mean for your wallet.
COVID-19 relief: In March, Biden delivered on a third relief bill. The $1.9 trillion rescue package included a new round of stimulus checks for up to $1,400 per eligible person (including qualifying dependents). Also: billions in aid – from $350 billion for state, local, and tribal govs and $130 billion for K-12 schools to $7.5 billion for vaccine distribution and over $7 billion for small businesses. As promised, the bill also increased the child tax credit to $3,000 per child ages 6 to 17 and $3,600 for children under 6. What was missing: student loan forgiveness (more on that in a sec) and a minimum wage increase.
Your move: If you got (or are still expecting) a stimulus check and haven’t made a plan for that money, put it to work. Think: showing your emergency fund some love, paying off credit card debt and/or investing. Bonus: if you can afford it, you could also donate some.
Student loans: Biden has said he would make four-year public colleges and universities tuition-free for students whose families earn less than $125,000. And cancel $10,000 in debt for all federal borrowers. Now, some lawmakers are pushing to cancel $50,000 in federal student debt per borrower. The admin has been exploring whether it'd be legal to do it. What happens next is still TBD.
Your move: If your student loans are on pause until October, add the minimum payment back into your budget now so you’re ready to restart as soon as the gov says, ‘go.’ But once that happens, consider holding off on making extra payments until it’s clear whether the new admin will discharge debt soon. If you have private student loans...sorry, these plans won’t help. But you may be able to help yourself to a lower payment by refinancing.
Taxes: Biden says he won’t raise taxes for most Americans. But corporations could face a tax hike to pay for his proposed $2.3 trillion infrastructure plan. Aside from improving the nation’s roads and bridges, the package proposes investing billions of dollars in job training, research and development, manufacturing, and expanding long-term care services.
Who else might see a tax hike? In his latest plan, Biden proposed a tax increase on the wealthiest Americans to fund childcare and education.
Your move: Save a little extra while you can. Because higher corporate taxes could translate to higher prices for consumers, aka you. Here are a few science-backed tips to help you save. And take advantage of all the credits and deductions available to you to save on your own tax bill. Reminder: the new tax day is May 17.
Healthcare: Through the American Rescue Plan, Biden expanded eligibility for the Affordable Care Act to help people pay for insurance bought through the individual marketplace. He also created and extended a special enrollment period for that public exchange. So a larger number of Americans who were previously uninsured are now eligible to enroll in a plan at a price they can afford.
Your move: Make sure your insurance matches your needs. If it doesn’t, change things up during open enrollment. (Psst...that's right now until August 15 for the public marketplace.) And take advantage of ways to save. Like signing up for an HSA or FSA, only going to in-network docs, scheduling preventative appointments, and opting for generic, 90-day supplies of prescriptions (if your doc and insurance approve).
theSkimm: The Biden-Harris admin has some ideas to mix things up. Be sure you’re making smart money choices for yourself, whether they’re able to push their proposed policies through or not.
Say ‘hi’ to our weekly newsletter. Every Friday, we break down the news and info you need to make smarter money decisions.
Skimm'd by: Ivana Pino, Casey Bond, Stacy Rapacon, and Elyse Steinhaus