What Trump Means for Your Finances

A presidential election usually brings significant economic uncertainty, and that has certainly been the case during the most recent round of political maneuvering. As the vote results were coming in, Dow futures plunged 900 points on the night of the election. Several months later, the market has recovered but not in all sectors. During campaigns, presidential candidates make many promises, only some of which will come to fruition. Now that Trump controls White House policy, markets respond based on predicted policies. Here are a few things to watch out for over the next four years.

Growing Poverty Problem Not Helped by More Taxes and Less Services

The lower class has the least insulation against policy changes that result in less income or rising prices. When you are constantly juggling bills, even small changes to your tax rate or one additional expense can push you off the financial cliff. Here is what may happen if some of President Trump's campaign promises materialize.

What Repeal and Replace Means for the Working Poor

Under the new provisions of the Affordable Care Act, colloquially known as Obamacare, some reports put the number of new Medicaid enrollees north of 20 million. If all of those individuals lost coverage simultaneously, the impact would be immediate and enormous. If you work in health care, expect to see sudden job shrinkage. If you don't have access to employer-sponsored health insurance, you'll be stuck with the challenge of finding alternative coverage at a much higher price point. For the lower class, repeal and replace may be a very expensive proposition.

What About All That Job Growth?

With massive infrastructure investments promised by the president everything from building a border wall to a new oil pipeline job growth could be on the horizon. If Trump can deliver on promised tax cuts and movement from the Federal Reserve Bank doesn't slow growth opportunities, more jobs could translate into more financial opportunity.

More Military Spending

Both Trump and Clinton spent much of their campaign time talking about expanded military spending. If the POTUS can get his budget approved, military spending is almost sure to skyrocket. That means more recruitment opportunities and more generous signing options. It can also mean a lot of opportunity for businesses that supply military operations, engineering outfits and technology.

Tax Reform for All

Another big campaign promise was tax reform. Trump has proposed a tax plan that has only three rates of 12, 25 and 33 percent. With the current low rate at 10 percent, this could mean a sharp increase in taxes for the lower class.

What Do These Policies Mean for the Middle Class?

Each of these policy changes will also affect the middle class, though where you fall in the bracket can significantly alter the financial picture.

End of Obamacare

The inception of Obamacare coincided with sharply rising premium costs. While some studies show that premium rate increases slowed after the inception of Obamacare, other studies show significant cost increases under the new legislation. Without a clear picture of what replacement plan will go into effect, it is virtually impossible to determine the likely outcome for middle class households. If you have health insurance through work, not much is likely to change in the near future. If you don't, you might see some significant changes to the individual health care market.

Projected Job Growth

With unemployment still higher than projected, more jobs can only improve your financial outlook. More jobs means negotiating power shifts to employees and encourages employers to offer more generous benefits packages and incentives.

Military Spending

Many small business owners may benefit from government set-asides as military spending ramps up. Increased and stable business opportunities could be of tremendous value if you are in a business that handles military contracts or services.

Tax Reform

Depending on where you fall in the current seven-tiered tax bracket, Trump's simplified tax plan could be very good or very bad. The 25 percent tax rate would apply to any single earners in the $37,500 to $112,500 range.

Trump Policies Brighten Financial Picture for the Upper Class

While there are many other Trump policies that may impact the upper class (school vouchers, reduced regulation, etc.) these four areas are some of the most commonly mentioned.

Obamacare Effects on the Upper Class

Currently, many of the upper class enjoy benefits packages subsidized by their employers. While it is true that premium costs are on the rise, it is unlikely that changes in Obamacare will have a direct impact on your finances unless you work in health care.

Job Growth

There are more than 5 million new job postings with unfilled positions available in the American job market. The upper class enjoys the highest percentage of college graduates, also offering the most economic opportunity from these unfilled job postings. Highly skilled job openings often sit empty for longer than entry-level jobs due to a lack of skilled applicants.

Military Spending

Unless involved in an industry directly related to military spending, this particular policy change is unlikely to massively affect the upper class. For those with business interests that supply military outfits and fill defense contracting needs, this is likely to be a highly lucrative time.

Tax Reform

The simplified tax plan proposed by Trump offers a significant tax cut to the wealthiest earners, though it may also include an uptick in taxes for those who fell into an upper-middle class bracket under existing tax brackets. The current maximum tax bracket sits at 39.6 percent.Until some of Trump's economic policies go into effect, it is impossible to say what the exact result will be. Many economists predicted a sharp fall for stock markets, but defying expectations, the market is up 15 percent domestically.