By Ceri V., Public Relations Intern and Guest Blogger
What does $1,000 mean to you?
To me – as a college intern – this means gas, new clothes and tuition.
Last fall when Congress was unable to reach a deal on the 2010 payroll tax cut, the White House posed a question to simplify a complex issue. With one Twitter hashtag they asked, ‘What does #40dollars mean to you?’
Now, after much debate, new legislation has been approved to keep $1,000 in American workers’ pockets. (Based on an average annual salary of $50,000.)
At least for now.
In an election year, with no guarantee that the payroll tax cut will continue past this year, it got me wondering; how are investors preparing for this possible 2013 income reduction?
According to Scottrade’s annual investment studies, there are already a number of things contributing to Americans’ financial stress; rising gas prices and everyday expenses, such as groceries. They are reporting that there isn’t enough money to pay the bills and responding by clipping coupons, cutting back on unessential costs and comparison shopping.
Our studies also found that investors have changed their investing strategies due to the economic environment. They are not only being more conservative with their money, but almost one-third are investing less. That uninvested cash is being used to cover everyday expenses.
With the tax cut extension, that means the average American worker will continue to keep about $40 in each paycheck.
How has your investment strategy been impacted by increases in everyday expenses?
Ceri V. has been with Scottrade since November 2011 an intern in the public relations department. She is a student at the University of Missouri-St. Louis studying communication.