Big changes are happening this year—many of them because of the new presidency. The Biden Administration will affect different people in different ways, but there are some important financial changes that will be important for everyone to understand. As we navigate 2021, here are some ways in which the Biden Administration will affect your personal finance.
The DL on Taxes
So far, President Biden’s tax plan only increases taxes for those making $400,000 or more. That’s good news for most of us and means that there’s no need to panic. So now that you know your taxes won’t go up, think of this as found money and start saving. If you need to do this in bite sizes, that’s fine. Even just putting away $25 a week will make a small dent. Think of this as your weekly Starbucks money. And remember that Biden’s plan right now is only a proposal. So, things could change. Prepare yourself for that and start putting away money now, in case taxes do increase for your income bracket down the line. Don’t assume your taxes won’t go up in the next four years.
New Job Alert
With Biden’s vaccine rollout plan and promise to create new jobs, including 10 million in clean energy and 3 million in caregiving, now is the time to start job hunting. Remember that President Biden is focusing new job creation by industry, and specifically for the working and middle class. He also supports raising the minimum wage to $15 an hour. So do some research and be open to new opportunities. A minimum wage job under President Biden—paired with a side hustle—might actually pay the same amount as an entry-level corporate job.
Student Loan Debt: Still a Thing
For now, student loans are still a thing. There’s been talk that President Biden wants to get rid of student loan debt and to cancel $10,000 in student loans. That remains to be seen, however. The good news is that President Biden has extended the federal loan repayment forbearance until September 30, 2021. And the Biden Administration has proposed other forms of relief, such as making community college free for two years and doubling the maximum of Pell grants and other federal aid. You want to continue to save money here in case you’ll owe money when the extension expires, but at the same time, hold tight. Alleviation could be coming.
Gas & Electric
We don’t usually look to our utility bills as a way to save money, but under the Biden Administration, we could see federal tax credits for renewable energy. This might mean a drop in energy costs. President Biden has also proposed a $2 trillion investment in green energy. There’s no way to know this for certain right now, though. But again, this could also mean more jobs in this sector, and more money and investment. Look to see what renewable energy start-ups are hiring. Go to websites such as Angel.co, a job hunting site for startups, and search by industry.
Back to Business
President Biden proposed a $30 million plan called the Small Business Opportunity Fund, which looks to support small businesses, especially crucial following the pandemic, when so many have closed. The plan aims to invest $50 billion for Black and brown entrepreneurs. There are other initiatives on the horizon for small business owners, such as expansions to Obama’s Small Business Credit Initiative and the Rural Microentrepreneur Assistance Program. If you’ve never looked to the government for financial assistance, now might be the time. You’ll want to take advantage of these initiatives.
Remember that right now, most of these initiatives are only proposals. They aren’t a guarantee, so don’t assume big changes are going to take place right away. And as we’ve seen with the vaccine rollout and other government-initiatives, change can be slow. It would be prudent to continue to be proactive instead of waiting for assistance. Save some money every week and check job sites.
A version of this article was originally published on Forbes.
