How The Stimulus Package Affects You and Me

The $819 billion stimulus package proposed by President Obama has been the hottest topic in U.S. News for the past week since President Obama’s inauguration. The bill was recently passed by the U.S. House of Representatives in a party-line vote with all Republicans voting against- and all but 11 Democrats voting for- passing the stimulus package. 

There is much debate over the success of the stimulus package among economic analysts.  Some believe the stimulus package would provide  much needed relief for American families, while others argued  that the tax cuts involved are not great enough- and disagreed with some of the allocation of funds.

And while the debate continues, I can not help but wonder-

“If passed, how will the stimulus package affect an average American taxpayer and homeowner like myself?”

Tax Cuts-The proposed stimulus plan is expected to be seen trickling into the average workers paycheck within a few weeks after the bill is passed. Many workers should see anywhere from an extra $8-$15 a week added to their paycheck which will come from a lower tax withholding.  The amount depends on your salary level.  It doesn’t seem like much, but over the course of a year, at the estimated dollar amounts above, this could me an extra $416-$780/year for some American families.

Unemployment Benefits-If you are one of the approximately 4.8 million Americans collecting unemployment benefits right now- the stimulus package may have a great affect on you. The package should reportedly increase the length of time a candidate can collect as well as increase the amount of benefits approximately $25/week. Over the course of a year this can mean an additional $1300 or so for an unemployed worker.

Jobs-In my opinion, more important than increasing unemployment benefits, is to get to the root of the problem and help stimulate the job market. One aspect of the stimulus package allows for $30 billion for building highways and tens of billions more for transportation projects, water projects, park renovation, military construction and local housing projects. These projects should help the job market– supposedly adding tens of thousands of jobs for American workers.

Schools- To aid the schools in our country the package is allocating $140 billion to education. For example, Title I schools will be allocated a total of $13 billion while another $20 billion will be invested in renovating schools around the country. (And while some critics of the package think that this will provide  little-t0-no help for our economy–others believe our children’s education should be a major priority.)

Food Stamps- Families of four or more currently collecting food stamps are expected to receive an additional $79/month for food at the grocery store. This could mean an additional $948/year for low-income families.

 And while critics argue whether the affects of the stimulus will be as great as the supporters propose, many families are anxiously anticipating some financial relief.  What will you do with your extra money every month?  Pay off your home insurance for the year?  Pay down your mortgage?