Here’s What Could Happen to Your Money in Trump’s First 40 Days in Office
As President-elect Donald Trump takes office again, many Americans are curious about how it will affect their personal finances. His administration could bring a host of economic changes, particularly in tax policies, trade and regulatory measures.
We’re also seeing positive signs from the U.S. economy. Inflation rates are down to 2.7% as of November, and unemployment is low at about 4.2%. This backdrop implies the overall environment is on the positive side for the growth of the economy.
Even with these promising signs, many voters were not happy about high costs of living, particularly on housing and food. Rent in the U.S. has increased 19% since 2019, per The Washington Post. U.S. food prices, meanwhile, have increased 25% since 2019, per the U.S. Department of Agriculture. Many people brought those feelings to the polls, giving Trump a win as president-elect.
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Looking at Trump’s policies and the current economy, here are some things that could happen to your money in Trump’s first days in office.
Also see six things to buy before Trump’s inauguration in January.
Trade Policies Could Increase Everyday Costs
Trump has vowed to slap an additional 10% tax on imported goods from China and 25% on goods that come from Mexico and Canada. He has indicated that one of his first executive orders after his inauguration will address these tariffs.
If Trump chooses to impose these tariffs, they will increase government revenue. Additionally, per the Council on Foreign Relations, many Republicans argue that tariffs in general help create jobs, increase economic growth and lower trade deficits, which could be good for consumers. However, tariffs could also lead to price increases on everyday goods, possibly negating any potential tax savings. Plus, inflationary pressure may put additional strain on the limited spending power of lower-income households.
According to a September 2024 survey from the University of Chicago Booth School of Business, an overwhelming majority of surveyed economists agreed that “imposing tariffs results in a substantial portion of those tariffs being borne by consumers of the country that enacts the tariffs, through price increases.”
Be Aware: 3 Major Retailers Who Will Raise Prices Immediately Under Trump — Tariffs Play Key Role
Deregulation Could Lead to Changes for Consumers
Trump has also stated intentions to repeal Biden administration rules on consumer finance and banking under the Congressional Review Act. The Consumer Financial Protection Bureau (CFPB) could see many changes, including leadership changes that could move the bureau from strict regulation to a more lenient approach. According to the McGlinchey Stafford law firm, it’s likely some of these changes will happen “very early” in Trump’s term.
Deregulation can benefit businesses and consumers with reduced costs. As reported by The New York Times, Rep. French Hill stated he wants to ensure that reforms made to the bureau make it a more responsive agency and allow “that consumer protection mission in federal statutes to be met, but be met in the most effective way possible with the least cost, with benefits to the consumer.”
However, deregulation could also harm the protection of financial transactions and consumer credit markets. Weakening the bureau’s regulatory power could mean less oversight of financial institutions. For example, the CFPB has examined capping fees companies can charge consumers, like overdraft fees and credit card fees, per The Washington Post. A more lenient CFPB and diminished consumer protections could lead to greater fees on loans and credit products.
As a result, U.S. consumers could be affected by increased borrowing costs, putting additional strain on household budgets and financial stability.
Healthcare Costs for Seniors Could Change
Trump has promised not to cut Medicare, which is particularly important to seniors who use the program for health coverage. Per Trump’s official platform, he aims to reduce healthcare and prescription drug costs by increasing transparency and promoting competition, which could help Americans keep more money in their pockets.
However, his administration could make privatization a keystone of the program, backing the plans run by private insurers, known as Medicare Advantage, per NPR. The shift toward privatization could lead to higher premiums and fewer choices for seniors. According to NPR, giving insurers more control with Medicare could “trap” consumers in certain plans that are more expensive to taxpayers.
Ultimately, Trump has vowed to not cut Medicare and to help Americans get healthcare without excessive costs, but it remains to be seen how soon he will enact any changes and what the full effects of those changes will be.
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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