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The Trump Effect: How Donald Trump Will Affect the Wallet of the Average American

The United States has about 41.5% of the global personal wealth on the planet and by comparison, Japan – in the number two spot on the list – only has 10%; but that wealth is unevenly distributed and so a win by Donald Trump can mean different things to different people – at least when it comes to their money. Here are some of the good things that Americans can expect to happen to their money as a result of the Trump Administration taking office, as well as some of the worst things that they can expect to happen to their wallets.

Taxes under Trump

There is almost certainly going to be tax cuts sometime in 2017 – particularly because both the Executive Branch and the Legislative Branch is controlled by the GOP. But since Trump had a couple of different tax plans it is difficult to predict just what that tax cut will be. However, one thing that experts agree on is that it won’t be great for everyone. Tax brackets will be reduced to three and groups that could pay higher taxes include large families and some single parents. On the other hand, the new tax brackets could mean less tax for many people, particularly since the lowest bracket rate is just 12% and goes from $0 to $75,000 (for joint filing).

Your Everyday Shopping Under Trump

On one hand, Trump’s campaign statements could make you believe that his policies will promote higher prices on foreign goods in the near future – particularly because of excise taxes. In addition, some of the trade policies he proposed could cost millions of private sector jobs.  On the other hand, spending may actually go up because people have more money due to Trump’s tax policies.

Housing under the Trump Administration

There wasn’t a whole lot about housing discussed by either party, but the issue of affordable housing still stands – and affects millions.  On one hand, the fact that Donald Trump got his start in real estate, and used that expertise to make billions, could mean that he has the knowledge and leadership to fix the housing crisis and make housing affordable for middle-class families. But no one really knows. Strong growth and better income distribution can help housing, but if Trump’s plans backfire, the housing problems could be worse than ever.

Investing Under Trump

It just isn’t possible to predict how investing is going to go under the new president. Experts predicted the market to drop out of shock if Trump won, and they did on election night, but the next morning they were trending back up. The market is so unpredictable and looking at it, trying to find reasons why it is going up or down based upon who is running the country, is an exercise in futility. Some companies, such as Glenmore investments, offer personal account advisors as well as a number of other advantages – and that’s what investors need no matter who the president is.

Paying for College under Trump

Under Trump, the student loan system will almost certainly be better – if his proposals get passed. He plans to cap federal student loan payments at 12.5% of the income of the student for up to 15 years after graduation. That is certainly better than the current system, but no one knows if he will actually go through with it. 

The Bottom Line

The bottom line here is uncertainty. No one knows what effect Trump will have on the financial markets, and other things – like his promise to repeal Obamacare – need to be considered as well. The best that the average American can do is wait and see.

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