Last week 126 million people cast their vote in the 2012 presidential election to decide the next four years of leadership of our country. Of the millions who left the ballot box on November 6th, jobs and the economy remained top of mind for voters with six out of ten ranking the economy as their number one issue this election cycle. With a 7.9 percent unemployment rate and record high gas prices it’s no surprise that these issues weighed heavy on voters’ minds. Even our poll conducted in the month leading up to the election found that 38 percent of more than 240 budget conscious consumers identified job stability and employment prospects as their number one concern.
But there was a glimmer of hope from voters who participated in the Associated Press national exit poll on Tuesday which found that four in ten people feel the economy is getting better. But the millions of Americans struggling financially right now may find it hard to agree. One thing we can all agree on is the need for sound financial management in the next four years. We need our elected officials to work together to solve some of the most challenging and threatening issues facing this country, most importantly the fiscal cliff that could cost Americans thousands of jobs and send the US back to an era of recession.
Beginning January 1, $500 billion worth of tax provisions are set to expire, including the Bush-era tax cuts and the reduced payroll tax. Once these policies – in addition to the unemployment benefits that have assisted millions of job-seekers – come to an end, nearly 90 percent of Americans will see their taxes rise, according to the Tax Policy Center. This means that the average household will be forced to pay nearly $3,500 more in 2013 than they paid in 2012. This will have a huge affect on all Americans, but especially on those who are struggling to get by. The time to start preparing for the potential impact is now.
There is no guarantee that these cuts will be extended, but there is one thing that this situation can teach us: consumers need to always be prepared and practicing good financial management, even if the government is not.