The Trump Economy Begins: 3 Money Moves Parents Should Make After Inauguration Day
Written by
Sean Bryant
Edited by
Amber Barkley
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With President Donald Trump now in office, there is a lot of uncertainty about what his policies could mean for the economy. This means many Americans are scrambling to get their finances in order.
If you’re a parent, there’s even more you need to consider. Making sure you’re making the right financial moves today can help safeguard your finances, no matter what happens over the next four years.
Keep reading for a look at three money moves parents should make soon after Inauguration Day.
Contribute to 529 Accounts
It’s no secret that student loan debt is a significant issue in the United States. However, setting up and contributing to a 529 account can help prepare your children for the costs of attending college. These accounts can also be a great way to minimize taxable income.
“529 college savings accounts are a great way to help your kids pay for college but also help lower your taxable income,” said Uli Ebensperger, co-founder and CEO of Ziggma. “States like Colorado, New Mexico, South Carolina and West Virginia allow you to deduct your entire contribution, while many other states offer a partial deduction.”
While Trump has promised changes to the tax code that would benefit all taxpayers, reducing your taxable income can help you keep more money in your pocket.
Add Any Extra Money to Your Emergency Fund
The Trump administration is expected to announce additional tariffs on foreign goods entering the United States within the coming months. While many of the details are still up in the air, goods from China and Mexico will likely be affected. Most economists believe this is going to cause higher prices on many products.
“Because of the potential for higher prices on consumer goods, it’s important to start planning now,” said Ebensperger. “Everything from toys and electronics to appliances are imported to the United States from countries like China. So what happens if your refrigerator stops working and you need to buy a new, more expensive appliance? It’s going to have a more significant impact on your finances.”
Ebensperger continued, “Allocating more money toward your emergency fund over the next few months will put you in a position to afford unexpected expenses without risking the need to go into debt.”
Review Your Health Insurance
While campaigning, Vice President JD Vance discussed allowing health insurance companies to group individuals based on their potential health risks. This would then allow them to implement risk-based premiums.
Given the incoming administration’s stance, it’s important that families review their health insurance coverage and make any necessary changes. If you have a high-deductible health insurance plan, setting up a health savings account (HSA) might be a good idea. Not only can this help pay for unexpected medical expenses, but it can also lower your taxable income.
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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