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IN THIS ISSUE: Job market update, debt trimmers, and passive income |
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THE HEADLINES
Tax actWhat’s happening: Earlier this month, a sweeping domestic policy bill was signed into law, and it included many tax changes.
Here’s why: The law makes permanent most of the tax cuts embedded in the 2017 Tax Cuts and Jobs Act (TCJA). It will also provide an additional tax boost for seniors, parents of younger children, and those with high state and local taxes (SALT).
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What it means for you:
Tax rates aren’t changing, and your taxes may go down due to increased standard deduction amounts and increases to the SALT itemized deduction limit. Among the provisions to pay for the tax changes were cuts to Medicaid spending, termination of clean energy credits that were part of the 2022 Inflation Reduction Act, permanently removing personal exemptions, and permanently capping the SALT limit. Some of the law’s provisions, like no taxes on tips and deductible car loan interest, are temporary. Learn
what else is in the new law and one thing that didn’t make it in.
Want more details about how the act could impact you? Consider speaking with a financial or tax professional. |
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IRA-OKWhat’s happening: Total assets in IRAs are up almost 23% over last year, according to Fidelity’s Building Financial Futures: Q1 2025 report,1 which analyzes retirement saving trends. The number of accounts also grew by nearly 13%.
Here’s why: Investors might be learning more about the benefits of IRAs, including tax-free or tax-deferred growth potential. It also could be because people may not be able to rely on Social Security paying full benefits, and savers want to make sure they have enough for retirement.
What it means for you: You might already have an IRA, but funding it and leaving that money uninvested is a common mistake. If you’re a Fidelity customer, check in your Fidelity app or by logging in to your Fidelity account. If you see a dollar amount more than $0 in “Available to trade,” (under “Balances” on Fidelity.com), you have uninvested dollars. Consider these
investing ideas for your IRA.
Plus, make sure you aren’t overlooking these 7 strategies to make the most of your IRA. |
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Mixed signalsWhat’s happening: Recent reports suggest the US is in a “hire less, fire less” job market.
Here’s why: June’s job report showed gains, but some sectors shrunk or were flat. In fact, the private sector had the lowest growth since last October’s dual damaging hurricanes. At the same time, a separate report showed layoffs are near multidecade lows. This all could suggest employers aren’t making moves until they get a clearer economic picture amid new tariff policies.
What it means for you: Job hunting might feel tough right now—unless you return to a previous employer. Boomerang hires are surging, according to a recent ADP report. If you’re thinking of going back, find out if your previous tenure can count toward becoming fully vested in your employer’s retirement plan matching contributions. (Get a refresher on how vesting works.) Trying to go to a new company?
Get tips for standing out as an applicant, and learn how to roll over your 401(k) from your previous employer. |
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HOW TO
Pay off $45,000 in debtAfter 2 stressful life events, Sheyna (pictured here with her dog, Obi) coped by overspending—until she maxed out her credit card. That was her wake-up call to find new tactics to regain control of her finances. |
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HELPING HANDOur thoughts are with everyone affected by the recent floods. Here are steps to begin recovering financially from a natural disaster. Not directly impacted, but want to help? Get
guidance from Fidelity Charitable®. |
SPOTLIGHT ON…
DividendsA dividend is a payment some public companies give to shareholders. Holding stock that regularly pays dividends—generally monthly, quarterly, or yearly—can be a nice source of passive income. The money isn’t guaranteed, though. A company can reduce or even cancel its dividend at any time, or a payment could be a one-time thing. On the flipside, better-than-expected profits at a company could mean bigger payouts to shareholders.
Recently, a Federal Reserve report showed some big banks could manage through an economic downturn if one happens—and could afford to raise their dividends as a result. If you own shares of those companies, some extra money could be in your future.
Even if not, you could research companies’ dividend payment history to help decide whether you’d like to invest in them. Need a hint on where to start? Some industries—including utilities, telecommunications, and financials—have consistently paid dividends. It’s also possible you’re already receiving dividends, and you don’t even know it. Dividends are usually distributed as cash but can also be issued as additional shares. Here’s how to
find and reinvest dividends. |
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