This Week In Your Wallet: Get Your Mind Out Of The Gutter
Finally – and finally – it looks like a much-needed COVID relief bill will actually pass both chambers of Congress and make it to the President’s desk for signing this week. What it has: An additional $300 a week in unemployment payments (on top of state benefits) for people who have lost their jobs. A continuing of eviction freezes for those who can’t pay their rent. And a reauthorization of the Paycheck Protection Program or PPP to provide another round of help for businesses small and not-so-small. (Additionally: The pause on federal student loan payments has been extended through the end of January.) What it doesn’t have: Stimulus checks. This $908 billion bill is being cast as a “relief” bill for the next few months rather than a “stimulus” one, explains USAToday. Whether or not to provide the sort of stimulus the CARES Act, passed at the beginning of the pandemic, offered, will be left to the next administration.
Let’s Talk About Your Skillz
I’ve been waiting for a report like this one – and I’m sure many of you have, too. For years, we’ve been writing about the importance, economically, of a college degree. That still holds true. As The New York Times reports, for about ¾ of the new jobs in this country, a four year degree is required. That’s a big driving factor behind income inequality. It’s been 40 years now that incomes have been rising for the college educated and falling for the 2/3 of Americans who are not.
But… we are starting to see a shift toward what’s called “skills-based hiring.” According to a new report from Opportunity@Work, a not-for-profit with the stated mission “to rewire the U.S. labor market so that all individuals can…work, earn and learn to their full potential,” up to 30 million workers could land jobs that pay 70 percent more, on average, than the ones they currently hold. No college degrees needed. In fact, although taking a course or two may be required, many already have the skills.
How can this happen? It will take a combo platter of employers – starting with big corporations – putting initiatives in place to recognize skills-based hiring, combined with a shift in public policy. Some companies already stepping up: AT&T, Microsoft, Walmart, Kaiser Permanente, and McKinsey. Kudos.
Working From Home… Away From Home?
Is your home in a different state than your office? If so, and if you’ve been working there (from home, that is) during COVID, take a deep breath. We need to talk taxes.
As Laura Saunders (who has been writing about taxes for decades) explains in her Wall Street Journal column, the problem is that different states have different rules and tax rates. When you work in one, you may need to file a tax return and pay for the privilege. Making matters worse, the state that houses your office may also want its portion of your income – even though you haven’t been there. As Saunders puts it: “In other words, if a Boston tech employee has been working from home in New Hampshire since March, Massachusetts still wants its income tax.” Ugh.
So, what do you do? And when do you have to do it? Figure out where you spent your time – count the days as accurately as you can. Dive into the tax policies of that/those state(s) as well as the one that houses your employer if it’s different. This helpful (albeit dense) chart from the AICPA lays it all out. If it’s too much, make a quick call to your benefits department or tax preparer to see if you should be withholding more in state taxes so that you don’t face a surprising bill when you file next year. Unfortunately, as Sanders writes: “When someone owes income tax to more than one state, these systems often clash and the taxpayer can wind up owing more tax, or the same, or [rarely] less.”
Get Your Mind (But Not Your Hands) Out Of The Gutter
I often refer to a clean-your-gutters analogy when talking healthcare. Gutter cleaning precautions are the ones that, when not done, will inevitably end up costing you more money in more difficult, invasive and expensive healthcare down the line. Getting your teeth cleaned is an example. So are some preventative screenings. (Reminder: My colonoscopy is overdue. Is yours?)
But there’s a reason it’s an analogy. There are a lot of home maintenance tasks that fall under the same umbrella. And if you don’t take care of these 8 inexpensive tasks every year or so you will very likely be looking at big, big, big bills down the road. On the list (including those aforementioned gutters) getting the HVAC serviced and getting the chimney checked out. You can read about the others at HerMoney.com.
Have a great week,