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Personal finance and money | News summary for 13 February

Update:
Tax season is here and for many inflation continues to put a dent in their purchasing power. Follow our live blog on financial news for all you need to know.

Senator Sanders takes to the floor, advocating for action on lowering prescription drugs

“Do you know why millions of diabetic Americans actually ration their insulin?

“I will tell you why. During the past 20 years, the pharmaceutical industry has spent over $4.5 billion on lobbying and hundreds of millions of dollars in campaign contributions.

“These are campaign contributions which go to Republicans. These are campaign contributions that go to Democrats. And I’m talking about hundreds of members of the House and Senate.

“Further, the pharmaceutical industry has, over the years, mounted an unprecedented lobbying effort in Washington and in states all over this country.

Bernie Sanders, US Senator from Vermont

US NEWS

Can you get financial aid for graduate school?

Looking to go back to graduate school but worried about the possibility of accumulating more debt? Read our full coverage for what options are available to bring down the cost of tuition. Additionally, we break down the current debate over debt cancellation, including news over the extension of the debt moratorium through April.

US NEWS

What have Democrats in Congress said about a new relief bill?

The remainder of President Biden’s signature legislative drive Build Back Better came to a screeching halt at the end of December. Just before the winter recess Senator Joe Manchin, a crucial vote for the legislation to pass the upper chamber, said that he could not vote for it.

Democrats have vowed to keep working to pass the sweeping climate and social policies Biden says will bring relief to Americans from the current high inflation. However, for the time being it appears that other legislative priorities will delay a vote on whatever can be salvaged.

Read more on what stimulus packages are being considered by Congress.

How much did the Consumer Price Index increase in January?

The Bureau of Labor Statistics reported late last week that in January, the Consumer Price Index jumped 0.6 percent, the same increase seen in December. This is a sign that inflation in the market is still on the rise, a major concern for many consumers.

But what is driving up inflation?

Members of the Republican party have been quick to point the finger at stimulus spending, including the sending of a third stimulus check last Spring. However, it has been almost a year since historic levels of spending were approved by Congress and the economy is still seeing increases in prices.

Some economists believe that the increased price level is due to ongoing global supply chains issues, which were only worsened by outbreaks related to the Omicron variant. To maximize efficiency, global supply chains are very fragile and susceptible to disruptions from economic shocks. The primary resources needed to make a product may come from various countries, to be assembled in another, and packaged in another. When factories or production slows in one or more areas, this can lead to bottlenecks in the supply chain which means that there is less supply and no changes in demand, creating a shortage. A typical way the economy treats a shortage, or scarcity, is buy increasing the price.

Saving for retirment on a tight budget

Putting away a nestegg for your golden years can be challenging when you have limited income. Professionals recommend 10 to 15 percent of your annual earnings as a rule of thumb. 

CORONAVIRUS STIMULUS CHECKS

Despite no additional stimulus checks, which states keep giving money?

While all talk of further federal stimulus checks to help Americans deal with lingering financial pain caused by the covid-19 pandemic has ceased in Washington, residents in some states could see some extra money in 2022. Calls by lawmakers on the Capitol Hill to send a fourth stimulus check or more direct payments to help relieve covid-19 induced hardship have faded mainly because detractors blame the last round for stoking inflation.

That is one of the same reasons why states that haven’t yet formalize sending a boost to pocketbooks are considering such a measure. For a second year in a row, states have seen large budget surpluses from better-than-expected tax revenues and their balance sheets padded with federal covid-relief funds, some of which are obligated by law to give some of that surplus back to residents.

Full details

To save money space out paychecks

New finance technology apps are allowing people to access their wages with ever greater frequency. Those who work for Uber have the option to get paid five times a day.

The apps are typically marketed toward low-income people as a way to avoid overdraft and late payment fees. However, research shows that receiving a salary on a daily basis encourages people to spend their earnings more than if they were paid less frequently.

2022 TAX SEASON

Child and Dependent Care Credit: An $8,000 tax credit parents should know about

Families with children should file a 2021 tax return this year if they want to receive any money they are eligible for from the enhanced Child Tax Credit. When you are filing though, you will want to check out other tax credits that were beefed up under the American Rescue Plan.

One may be of particular interest to families that have older dependents as well as children they claim on their tax filing. Although the Child Tax Credit gives taxpayers up to $3,600 per child, the Child and Dependent Care Credit could be worth up to $8,000 for a family with two or more children or dependents. Half that amount if they have just one.

Full details

CORONAVIRUS STIMULUS CHECKS

How much were the first, second and third stimulus checks and when were they sent out?

The Internal Revenue Service said they had been successful in delivering “more than $1.5 trillion to people across the nation through Economic Impact Payments, tax refunds and advance Child Tax Credit payments.” Here's a look at the three Economic Impact Payments, better known as stimulus checks.

Read more

Teaching children about money including filing tax returns

When should you start teaching your children about money? According to Ken Eyler, certified public accountant and CEO of Aquilance, a financial services company around age 5 or 6. By the time they become a teenager they should understand that money is a tool and how it works in society. Eyler gives advice on what kids should learn when they are young.

Web3, a good investment or flushing money

Bitcoin and other cryptocurrency tansactions are maintained on distributed ledgers called blockchains. These decentralized networks have moved beyond digital coins and are now being used to sell non-fungible tokens (NFTs) and could be the foundation of the next big thing in cyberspace Web3.

Advocates and venture capitalists see it as a a better, more decentralised version of the internet. In 2021, $25 billion was poured into crypto-investments five times more than the previous year. But will the decentralized Web3 bring the same kind of returns as its predecessor, and can it really remain decentralized?

"Buy Now, Pay Later" raising debt concerns

Regulators are starting to get worried about a service which allows shoppers to take on short-term, often interest-free loans to make purchases. The number of "Buy Now, Pay Later" loans exploded during the pandemic as shoppers were trapped at home. The are worries that the unregulated lending is creating a debt bubble that could blow up.

SOCIAL SECURITY

What is the medicare deductible for 2022?

The announced increase in the price of Medicare deductibles is here, and it's not good news for those already under pressure from the cost of living squeeze.

The deductibles for Part A and Part B are both increasing, as well as a whole host of other aspects of Medicare. This refers to the amount someone is expected to pay before their Medicare coverage helps them. The higher it is, the more you have to pay.

Full details

SOCIAL SECURITY

How can I apply for Supplemental Security Income?

Supplemental Security Income (SSI) is designed to provide vital financial support for eldery, blind or disabled Americans with insufficient income.

Here's how to claim the payments...

Canadian trucker blockade causing economic misery in Michigan

US Chamber of Commerce, National Association of Manufacturers and Business Roundtable comment upon truckers

The business community is rolling up its sleeves to find workarounds and keep facilities up and running, but we are already seeing some production cuts, shift reductions, and temporary plant closures. The North American economy relies on our ability to work closely together, including our manufacturing sectors. We need to apply the same spirit of cooperation to tackle this problem.

business group statement, regarding trucker blockade

WELFARE PROGRAMS

Are SNAP benefits the same as food stamps?

The covid-19 pandemic and the subsequent inflation that has come with the economic rebound has put a lot of stress on household finances. For families that are struggling to make ends meet, they may be able to participate in the Supplemental Nutrition Assistance Program (SNAP), previously called Food Stamps.

The program is the largest food assistance program in the United States with over 41 million people receiving benefits. That number is an increase of nearly 6 million since before the pandemic when the program reached its lowest number of participants in 10 years in 2019.

Full details

US NEWS

What is the labor force participation rate?

The Labor Force Participation Rate is an estimate of how many people can be classed as 'active' in a workforce. These are people who are currently in work or who are actively seeking a job.

It has been argued that this measure is a better assessment of unemployment, as it excludes those who are incapable of work and accounts for people who aren't looking for a job, something raw unemployment data doesn't do.

Read more

Hello and Welcome!

Tax season is here, the chances of Congress passing the Build Back Better bill are dwindling, unemployment is holding steady.

Today, 13 February, we at AS USA will be bringing you all the personal finance and economic news you need.

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