The U.S. national debt is the total amount of money owed by the federal government. As of January 2025, it stands at $36.16 trillion.1 The difference between deficit and debt When the federal government spends more money than it collects in taxes in any given fiscal year (the government's fiscal year runs from October 1 to September 30), there is a deficit. The opposite of a deficit is a surplus. To fund its operations when there is a deficit, the government borrows money by selling … [Read more...]
Erb Financial: March Newsletter 2025
Link to Printable PDF: 2025 03 March Newsletter Funding the Federal Government The IRS collected a little more than $4 trillion in net taxes (after refunds) in fiscal year 2023. About half was individual income taxes, and around 35% was employment (payroll) taxes, including Social Security, Medicare, unemployment insurance, and railroad retirement. Business income taxes made up a little over 10% of the total, with relatively small contributions from excise, estate and trust income, and estate … [Read more...]
Tariffs: How They Work and Potential Economic Effects
On February 1, 2025, President Trump authorized an additional 25% tariff on all goods entering the United States from Canada and Mexico (except for a lower 10% tariff on energy resources from Canada) and an additional 10% tariff on all goods from China. Nine days later, Trump authorized a 25% tariff on steel and aluminum, effective March 12, which strengthened and elevated tariffs levied by the first Trump administration in 2018.1 These were the opening salvos in what promises to be a period of … [Read more...]
Key Retirement and Tax Numbers for 2025
Every year, the Internal Revenue Service announces cost-of-living adjustments that affect contribution limits for retirement plans and various tax deduction, exclusion, exemption, and threshold amounts. Here are a few of the key adjustments for 2025. Estate, gift, and generation-skipping transfer tax The annual gift tax exclusion (and annual generation-skipping transfer tax exclusion) for 2025 is $19,000, up from $18,000 in 2024. The gift and estate tax basic exclusion amount … [Read more...]
Accounts for Two: A Team Approach to Retirement Savings
Almost half of U.S. families headed by a married couple include two working spouses.1 With dual careers, many spouses accumulate assets in separate retirement accounts. Each might have funds in an employer-sponsored plan and an IRA. Even if most of a married couple's retirement assets reside in different accounts, open communication and teamwork can help them craft a unified retirement strategy. Working together Tax-deferred retirement accounts such as 401(k)s, 403(b)s, and IRAs … [Read more...]
Erb Financial: February Newsletter 2025
Link to Printable PDF: 2025 02 February Newsletter Steady Growth in Real Wages Wages rose strongly with inflation beginning in mid-2021, but the pace of price increases was faster than wage increases, leading to a loss of buying power despite higher income. Real wages — adjusted for inflation — actually declined during this period. For example, at the height of inflation in June 2022, wages increased at an annual rate of 6.7%, but real wages declined by 2.4%. Inflation has dropped … [Read more...]
What’s New for 2025?
To help you stay informed, here are five changes you can look forward to in the new year. Higher catch-up contributions for some. As of January 1, individuals ages 60 through 63 may be able to make increased catch-up contributions (if offered) to their workplace plan. The catch-up amount for people age 50 and older is $7,500 for 2025, but for people ages 60 through 63, the limit will be $11,250.1 Cap on out-of-pocket Medicare drug costs. A bit of welcome news for people with Medicare Part … [Read more...]
Three Market-Moving Economic Indicators to Watch
Among all of the economic indicators released each month, three reports in particular can move the market: the Employment Situation, gross domestic product, and Personal Income and Outlays. The Employment Situation Each month, the Bureau of Labor Statistics (BLS) publishes the Employment Situation Summary report based on information from the prior month. The data for the report is derived primarily from two sources: (1) a survey of approximately 60,000 households, or about 110,000 … [Read more...]
Erb Financial: January Newsletter 2025
Link to Printable PDF: 2025 01 January Newsletter Do You Have a New Year's Resolution? One out of three U.S. adults typically plan to make New Year's resolutions. Younger people are more likely to make resolutions, and they tend to place more emphasis on finances, happiness, and mental health, whereas older people tend to emphasize physical health. Experts suggest that it's easier to keep resolutions that are specific and measurable, and it can be helpful to reward yourself for meeting … [Read more...]
Tax Preparation Checklist 2024
View, Download, or Print - Tax Preparation Checklist 2024 Tax Preparation Checklist - 2024 Tax Year WE MAKE FILING LESS TAXING Copy of both sides of your Driver’s license or State ID. Joint filers need both IDs. (Not necessary if we already have your unexpired IDs on file.) Wage Statements (W-2) and 1099 Forms Pension, IRA, or Annuity Statements (1099-R) Social Security Income Statements (SSA-1099) Interest & Dividend Income Statements (1099-INT & 1099-DIV) … [Read more...]
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