Relief checks summary news: 4 January
Financial news: Latest updates
Headlines: Wednesday, 4 January 2023
- US housing market likely to slow in 2023, experts warn
- California inflation relief program will conclude this month - How many payments are left?
- Social Security recipients receive COLA boost of 8.7% to start the year
- Biden signs $1.7 trillion spending bill to fund government - Medicaid expansion reversed
- Supreme Court to hear challenges to Student Loan Forgiveness in February
- What next for interest rates as inflation starts to ease?
- Minimum wage to rise in several US states in 2023
Related news stories:
Which states' insurance is getting much more expensive?
Two states, Wyoming and West Virginia, have healthcare costs that are 50% more expensive compared to the national average, with both having annual costs of over $10,000 a year on the silver plan alone.
Three states have silver plans that cost less than half of this crazy figure: New Hampshire, Maryland, and Minnesota.
Healthcare costs are increasing for most Americans in 2023. Without a public healthcare system price rises in some states may put thousands onto worse coverage plans and potentially leave them staring at financial ruin for a problem that was not their fault.
According to valuepenguin.com, the average monthly cost of health insurance in the United States is $560, a 4% increase on 2022′s $531. This is based upon the average silver plan cost for a 40-year old applicant.
The most well known change to the 401k retirement plan at this stage is the increase of the contribution limits. The IRS will increase the thresholds in 2023, allowing workers to contirbute more towards their retirement.
However, it isn’t just the contributions limits that are increasing. Plans inside the latest yearly spending bill for 2023 set to make a few key changes to the retirement plan that look set to make it easier for workers to save money for their future life.
What will happen to interest rates this year?
Last year the Federal Reserve relentlessly targeted high inflation. There were fairly few tools at the Fed's disposal to help with this effort and it resorted to a number of interest rate hikes to make borrowing more expensive and cool the overheated economy. But, as those with mortgages will have felt, interest rate increases can have wider consequences...
Updated standard deduction thresholds for 2023.
- Single; or Married and filing separately - $13,850
- Married filing jointly and Surviving spouses - $27,700
- Head of household - $20,800
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If you’re thinking about starting your tax filing, you should be aware of the updated standard deduction thresholds for 2023.
The term ‘standard deduction’ is the earnings threshold below which you will not have to pay tax on your income. This either means that you can reduce your tax bill, or it could free you from income tax entirely.
For 2023 the IRS has upped the standard deduction thresholds significantly, meaning that more people will not be required to pay federal income tax.
After inflationary pressures pushed up prices across the board in 2022, household incomes have effectively been devalued. This has encouraged the IRS to update income thresholds for the upcoming tax year, which could save you money when it comes to filing time.
Here’s a look at what has changed for 2023...
When are the final inflation relief checks going out?
Last year Gov. Gavin Williamson passed the California Middle Class Tax Refund, offering one-off payments worth up to $1,050 to state residents. The payments are set to conclude this month with the final waves of debit cards going out now.
If you are still waiting for a California inflation relief check, here's the payment schedule...
Will I lose Medicaid coverage in 2023?
The passing of Congress’ $1.7 trillion omnibus package provided the funding required to prevent a partial government shutdown over the holidays. That bill was required to keep federal programs running for 2023, but some major changes were included in the final package to ensure it passed.
Chief amongst those changes was a provision that will allow states to remove millions of people off Medicaid from April 2023. The Kaiser Family Foundation estimates that roughly 20% of current recipients could lose Medicaid coverage.
This equates to more than 15 million Americans.
When a public health emergency (PHE) was declared in early 2020 to help tackle the covid-19 pandemic, states were prevented from removing anyone from Medicaid. Eligibility for the heavily subsidised healthcare is based on a variety of economic and personal factors, meaning that people are added to and removed from Medicaid as their situation changes.
Will interest rates stay high in 2023?
Throughout 2022, in a bid to tackle the sustained high rate of inflation, the Federal Reserve imposed a series of interest rate hikes. Their aim was to cool the overheating economy by making borrowing more expensive, but this move has also had broader consequences in the economy. There are hopes that the Fed may be able to lower interest rates in 2023, but inflation remains the top priority.
Healthcare costs are increasing for most Americans in 2023. Without a public healthcare system price rises in some states may put thousands onto worse coverage plans and potentially leave them staring at financial ruin for a problem that was not their fault.
According to valuepenguin.com, the average monthly cost of health insurance in the United States is $560, a 4% increase on the figure of $531 recorded in 2022. This is based upon the average silver plan cost for a 40-year old applicant.
We take a look at the different options on offer...
House at a standstill after Speaker vote deadlock
Congress has a series of major economic issues to contend with in the near future. Tackling inflation, rebuilding the economy and bringing the deficit under control are all the stated aims of the new majority party, the Republicans, but their rule faced an immediate setback after members were unable to agree on a new Speaker of the House on Tuesday.
For the first time in 100 years a Speaker was not elected in the first vote, and after three winner-less ballots the decision was made to adjourn the chamber until noon today.
Keep up to date with all the latest from the House here: McCarthy fails to claim a majority in Speaker vote
More than 76 million Americans were affected by a massive T-Mobile data breach which saw hackers steal the personal information of huge numbers of current, former and prospective clients. The incident first came to light after Vice uncovered posts on an online forum which offered T-Mobile customer data for sale.
The settlement represents the second-largest data break pay-out in US history and millions of victims are expected to be eligible for compensation. Payments range from $25 to $25,000.
Here's everything you need to know to make a claim...
Which states have raised the minimum wage?
Workers in California will now receive at least $15.50 per hour after the state's employment laws upped the minimum wage. The Golden State was one of 23 states to introduce a minimum wage increase at the start of 2023, with another four set to impose a boost later on this year.
Full list of minimum wage increases
The housing market has been characterised by instability in recent years. At first the economic shutdown left interest rates, and therefore mortgage rates, on the floor. However to address sustained high inflation during 2022 the Federal Reserve instituted a number of interest rate hikes, making borrowing especially expensive.
After this fluctuation it is difficult to predict where the housing market will go in 2023, but Forbes spoke to a number of real estate experts to get their take on the outlook for the year ahead…
Tax credits available for electric cars
The Biden Administration's Inflation Reduction Act was heralded as a key legislative achievement when it was signed into law last year, but not everyone is aware of the programs included in the package. One such measure is a significant tax credit for anyone who buys a new electric car, worth up to $7,500..
A statement from the White House reads: "The Inflation Reduction Act lowers energy costs for consumers and small businesses while creating good-paying jobs as America’s clean energy economy and manufacturing sectors grow."
Boost for auto industry expected this year
The automobile industry has been hampered by a number of factors since the start of the pandemic, but it was the supply chain issues that proved the most difficult to resolve.
There was a severe shortage of semi-conductor chips which are essential for the production of modern cars. Now that those problems have largely been resolved, experts suggest further groth for the manufacturing industry.
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Stay with us for all the latest on the COLA increase for 2023 and other financial news from the United States.