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In recent times, many Americans, including people like Glenn, a small business owner from Portland, Oregon, have expressed concern that the actions of Washington could negatively impact their personal finances. This sentiment is echoed by a wide range of individuals across the country. Let's dive into why this is happening and what you can do to protect your finances.

Introduction: Why Are People Worried?

Glenn, a 43-year-old small business owner and parent, fits the profile of someone Republicans often highlight as a beneficiary of their tax policies. However, Glenn feels the recent tax bill won't help her earn more money or increase her payroll. She isn't alone in her skepticism. According to a survey by Bankrate.com, 40% of Americans expect Washington to harm their financial situation, up from 26% last year. Only 24% believe they might receive some help, while 33% don't expect any impact.

The Role of Partisanship

One major reason for these varied expectations is partisanship. Nearly 60% of Republicans believe their finances will improve, while over two-thirds of Democrats think things will get worse. Independents are split between expecting no change and anticipating a downturn. The key issue driving this divide is taxes.

Tax Cuts: Corporations Versus People

What’s the Difference?

The recent tax bill has been a hot topic, especially around who benefits more—corporations or individuals. Generally, corporations have received significant and permanent tax cuts, while individual tax cuts are temporary and less substantial.

Jason Bauman, a 32-year-old from north of Philadelphia, represents those who are wary of these changes. He plans to move to New Jersey and is concerned about the long-term impact on his taxes, especially since some deductions are now capped, making home ownership more expensive.

Why Corporations Benefit More

The tax cuts for corporations are designed to be permanent, unlike those for individuals. Many middle-class families, like Glenn’s, feel that they won't see much benefit. In fact, analysis shows that while middle-income households might see a small tax cut now, the wealthiest earners get much larger cuts.

Tax Bill Winners and Losers

Who Really Benefits?

A survey found that only one-third of Americans support the tax cuts, while over half are opposed. This opposition likely stems from the perception that the wealthy benefit disproportionately. For example, middle-income households might see a $930 tax cut in 2018, while the wealthiest earners could see $7,640 in relief. Over the next decade, many middle-class Americans might even face a small tax increase, while the richest continue to see benefits.

Real-Life Impacts

People like Glenn and Bauman are worried about the long-term effects. Glenn won't be hiring more people, and Bauman fears higher personal taxes down the line. They both represent a broader concern that these tax policies won't help the average American as much as promised.

What You Should Do

Plan for the Future

If you do see some extra cash in your paycheck, think of it as temporary. Here are some steps you can take to secure your financial future:

1. Pay Down Debt: Use any extra money to reduce your debt. This will lower your financial burden and give you more flexibility in the future.
2. Save More: Add to your emergency fund. With potential tax increases in the future, having a cushion can provide peace of mind.
3. Invest Wisely: Consider investing in safe and reliable options to grow your savings over time.

Don't Rely on Tax Cuts

It's crucial not to see these tax cuts as a permanent change. By treating them as a temporary boost, you can avoid getting too comfortable with the extra income, making it easier to adjust if and when the tax cuts expire.

Conclusion: Navigating Uncertain Times

Many Americans, like Glenn and Bauman, are skeptical about the impact of Washington's tax policies on their personal finances. With a significant portion of the population expecting more harm than good, it’s essential to take proactive steps to secure your financial future. By paying down debt, saving more, and investing wisely, you can navigate these uncertain times with greater confidence.

Remember, while the political landscape may change, your proactive financial habits can help you weather any storm.