WAUKESHA — November has been a busy month for Wall Street. The stock market is reacting to recent events like the Presidential Election and Coronavirus vaccine breakthroughs. Waukesha-based Drake & Associates have details on how all of this affects your wallet and ultimately your financial future.
So how is the stock market responding to recent events?
Leading up to the November election a lot of volatility was seen on Wall Street. When it became apparent that there would be no second stimulus package passed before the November election the stock market saw significant drops. Now in the last couple weeks, we have seen and heard of promising news on possible COVID-19 vaccines, this has caused a reaction on Wall Street to see increases as optimism for that vaccine rose. But it's a double-edged sword because Coronavirus cases are soaring across the nation which has some stocks seeing dips as states impose further lockdowns and restrictions on businesses.
When it comes to the results of the election, what do I need to know about President-Elect Joe Biden and my money?
In order to get a full picture, you have to look at a few things.
First, President-Elect Joe Biden has said he plans to raise taxes for those making more than $400,000 a year, which his administration hopes will fund a host of new initiatives. According to CNBC those who make $400,000 or more account for the top 1.8% of taxpayers and earn about 25% of the nation's income.
The former Vice President has also said he has plans to increase Social Security benefits and plans to fund it through higher payroll taxes on the wealthy.
Since lawmakers were unable to come to an agreement on a second Coronavirus stimulus package, President-Elect Joe Biden has said he would like to dedicate $2 trillion to help boost the economy in January of 2021. This would be done by refilling the pot of funds previously used in the Heroes Act which supported small businesses, assistance for airline industry workers, and help with education and childcare funding. The heroes act also provided $1,200 direct payments to taxpayers and $500 per dependent.
So how does all of this impact the economy?
The stock market reacts after most large events, but that's not true in every event. For example on Wednesday, November 18th, 2020 stocks closed down at the closing bell even though Pfizer had announced that its COVID-19 vaccine is allegedly 95% effective. Some say that's likely because Coronavirus infection numbers continued to skyrocket.
Investment advisors with Drake & Associates say while elections are certainly something to keep an eye on, it's not necessarily something that should be driving investment decisions and recommended working with a financial advisor before making major changes to your portfolio which can include your 401(k) retirement account.
How can you feel financially secure?
Drake & Associates say while you can plan and prepare for changes in the economy you cannot ultimately control it. But you can control other factors like how much debt you take on and how much you put into your retirement accounts.
Meeting with a financial professional can help ensure that you have peace of mind. Understand that every stage of life requires different approaches to how you may make financial decisions so it's important to work with a financial advisor to get a plan in place for you and your financial future.
Drake & Associates has additional details on how to make sure you are prepared for the future at