ELECTION REPORT: Trump’s Plans for Your Money | Personal Capital
Must be a valid email address.
Password must be 8-64 characters.
Must be a valid phone number.
Recession incoming? Here’s how you can prepare.
Daily Capital
Home>Daily Capital>Investing & Markets>ELECTION REPORT: Trump’s Plans for Your Money

ELECTION REPORT: Trump’s Plans for Your Money

After a politically tumultuous year, Election night has finally come and gone. In perhaps the closest election in the United States’ history, America chose Donald Trump to be the 45th president of the United States. Trump will be the first president without any military or political experience to be sworn into office. A true business mogul in the White House, his election begs questions about how markets will react and what changes individuals can expect in their day-to-day financial lives if his policies are enacted.

As Trump’s upset in the polls unfolded on Election night, markets all over the world tanked. S&P 500 futures were down the maximum allowable 5% in after-hours trading. Dow futures were down 750 points, a larger fall than right after 9/11. The Mexican peso plunged more than 11 percent to a record low against the dollar. But by the time markets opened Wednesday morning, most of the fear had dissipated. Risk assets recovered their initial losses and US stocks opened just about flat. Despite the muted response so far today, the next week is likely to be volatile as investors continue to digest.

Americans Are Asking

However, most Americans aren’t as concerned with market fluctuations. According to the Personal Capital advisors, the most common financial question American investors are asking the past 48 hours is: “What does Trump mean for my retirement and my cashflow?”

The bottom line: Investors should not let short-term political drama drive their long-term financial priorities or investment decisions.

But there’s more to it than that. In order to help American investors come up with an action plan for their money, Personal Capital dug into the policies and assessed the short and long-term market and personal finance implications of a Trump presidency.

Below is a shortened look at President Trump’s policies on taxes, Social Security, education, and health care – how they may affect your money and what you should do about it.

President Trump’s Plans For Your Money

1. Taxes: Trump plans to revise both the individual and corporate tax codes and has proposed collapsing the seven tax brackets into three. For married-joint filers that have an income of $75,000 or less they will fall in the 12 percent bracket, those earning more than $75,000 but less than $225,000 will fall in the 25 percent bracket and those earning more than $225,000 will fall in the 33 percent bracket.
What you should do: For an optimal tax strategy, regardless of income, Personal Capital recommends that investors utilize tax-loss harvesting, tax allocation and buy tax efficient securities.

2. Social Security: Trump plans not to touch social security and wants to maintain current medicare programs once he is sworn into office.
What you should do: With a currently underfunded Social Security system, Personal Capital recommends that investors take a conservative approach and plan for a reduction in Social Security benefits or an increase in the Social Security tax rate while working.

3. Cost of Education: Trump wants to add an additional investment from federal dollars of $20 billion towards education.
What you should do: With the likely difficulty of funding such a program, Personal Capital recommends families nevertheless plan ahead and budget $25,000-$40,000 per year for education.

4. Cost of Health Care: Trump plans to repeal and replace the Affordable Care Act with Health Savings Accounts.
What you should do: Personal Capital recommends investors optimize their financial plans to anticipate approximately $250,000 in medical expenses during retirement.

Creating A Financial Plan That Withstands Political Change

A new president can mean new policies on taxes, Social Security, education, and health care — hot topics that affect the personal finances of every American. And whether Americans are thrilled to see Trump in office or not, the successful rollout of his policies still comes down to compromise within each house of Congress, across both the House and the Senate, and between Congress and the White House. The best thing to do as an investor concerned about your retirement and cash flow, is make sure you have a sound, long-term investment strategy. Then just stick to it and wait.

The content contained in this blog post is intended for general informational purposes only and is not meant to constitute legal, tax, accounting or investment advice. You should consult a qualified legal or tax professional regarding your specific situation. Keep in mind that investing involves risk. The value of your investment will fluctuate over time and you may gain or lose money.

Any reference to the advisory services refers to Personal Capital Advisors Corporation, a subsidiary of Personal Capital. Personal Capital Advisors Corporation is an investment adviser registered with the Securities and Exchange Commission (SEC). Registration does not imply a certain level of skill or training nor does it imply endorsement by the SEC.

Better financial lives through technology and people.
Icon Close

To learn what personal information Personal Capital collects, please see our privacy policy for details.

Let us know…

This year, my top financial priority is:

Building my emergency fund
Paying off high-interest debt
Budgeting better
Saving for a short-term goal, like a vacation or new car
Increasing my investment contributions
Maintaining status quo - I’ve got this under control

Make moves toward your money goals with Personal Capital’s free financial tools.