The Trump Economy Begins: 3 Money Moves the Upper Class Should Make Before Inauguration Day
Written by
Deborah Sabinus
Edited by
Amber Barkley
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Many of President-elect Donald Trump’s policies in his first presidential term benefitted the upper class, and the same is expected to happen in his incoming term. For example, the reduction of corporate tax to 21% resulted in higher salaries for top executives, according to the Center on Budget and Policy Priorities. Trump’s plan to lower this tax to 15% could aid many high net-worth individuals in becoming richer.
This is good news for those in the upper class, and there are some money moves you can take advantage of before Inauguration Day. Experts Crystal Stranger, CEO of Optic Tax, and Andrew Latham, certified financial planner and content director of SuperMoney, shared the moves they recommend making.
Next, find out which money moves the upper middle class should make before Inauguration Day.
Check Your Investments
The proposed tax reduction, a strong dollar and pro-business policies could mean higher corporate profits and stock market gains.
Stranger said, “The initial actions will be linked to increasing the value of the dollar and reducing taxes while cutting spending, so overall for HNW [high-net-worth] individuals, it should be a good time to be in dollars and investing in the U.S. over the next couple of years.”
The strengthening of the dollar could have a ripple effect across the global economy, impacting trade balances, currency exchange rates and international investment flows. Tax reductions, especially for corporations and upper-class members, may stimulate economic activity and investment.
Evaluate Tax Strategy
As Inauguration Day approaches, it is important to reassess all your existing tax strategies, since there will be a shift in tax policies.
Latham recommended high-net-worth individuals revisit their tax strategy. “Take advantage of the current historically high lifetime gift exemption for estate planning, and if higher capital gains taxes are a possibility, consider locking in gains at today’s rates by selling appreciated assets.”
The current high lifetime gift exemption allows you to transfer tax-free wealth to beneficiaries, thereby reducing the impact of future tax law changes. If there are increased capital gains taxes under the new administration, it is strategic to sell appreciated assets and lock in gains at the present, lower tax rates.
Diversify Your Portfolio
Diversification helps to reduce risk by spreading your investments across various sectors and asset classes. Maintaining global exposure and ensuring liquidity in your portfolio also protects your investments. This approach ensures that even if some sectors underperform due to policy changes or other factors, others may compensate and stabilize your overall portfolio performance.
Trying to predict which of your investments will do well is a risky endeavor, so while you may want to make some changes based on predictions, keeping your portfolio diversified is the best strategy.
Editor’s note on political coverage: GOBankingRates is nonpartisan and strives to cover all aspects of the economy objectively and present balanced reports on politically focused finance stories. You can find more coverage of this topic on GOBankingRates.com.
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