For Americans hoping for a fourth stimulus check, President Joe Biden’s joint address to Congress this week may have come as something of a disappointment. That’s because the president made no mention of another direct payment to Americans when he spoke before the House and Senate to outline his agenda.
But while there are no current efforts to put more money into people’s bank accounts via a fourth stimulus check, Biden outlined a number of plans that could potentially provide more financial relief to individuals and families over the long term.
See, while a stimulus check is a one-time payment, some of Biden’s proposals could possibly help the typical American save money for years to come.
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President Biden’s American Families Act offers financial help to millions of Americans
Although Biden didn’t mention another stimulus payment, he introduced new proposed legislation called the American Families Plan.
If passed, this legislation would reduce childcare and healthcare costs for many families; subsidize college tuition costs; provide paid sick leave and family leave; expand food benefits; and lower health insurance premiums for many.
The specific effect of these benefits would vary depending on your income level and family situation.
For example, Biden’s plan would offer a tax credit valued at $3,600 per child under age 6 and $3,000 per child over the age of 6 for eligible families. This expanded Child Tax Credit was put in place by the recent coronavirus stimulus bill, but only for 2021. Biden wants to offer this money to families through 2025.
Families with children would also benefit from a proposal to cap daycare costs at 7% of income. This provision alone could save the average family $14,800, according to the White House.
And while individuals without children wouldn’t benefit from these proposals, the president also wants to expand the earned income tax credit for qualifying childless individuals. And he wants to offer more assistance paying health insurance premiums, which could save the average family as much as $50 per month.
Although these changes may not be as exciting as a fourth stimulus check, individuals and families who receive tax credits, subsidized childcare and healthcare, paid leave, and broader access to education could see a more permanent shift in their long-term financial circumstances than a single additional check could offer.
Of course, there’s no guarantee any of the plans the president outlined will come to pass. In fact, while the Democrats were quick to provide a third stimulus check, there was near uniform agreement on the left that additional coronavirus relief was necessary.
Passing the American Families Act will be more challenging as some of the provisions within it are more controversial. The legislation also includes tax increases. While they are targeted towards the wealthy, there’s still some concern that increasing revenue collection in the aftermath of the pandemic could affect economic growth.
Finally, some conservative Democrats believe the next big bill that passes should be bipartisan, as the recent coronavirus relief legislation passed on a party-line basis. If they hold firm to this position, many of the provisions of the American Family Act will likely be unable to become law because Republicans won’t support them.
Still, those hoping for another stimulus check may want to shift their focus to learning how the president’s new proposals could affect their finances, as the fact that Biden failed to mention a fourth check in his recent address suggests the administration has clearly shifted away from stimulus checks towards other proposals they believe could help the public.
View more information: https://www.fool.com/the-ascent/personal-finance/articles/stimulus-check-update-could-bidens-latest-plan-provide-more-financial-help-than-a-fourth-stimulus-check/