It may seem like it’s been going on forever, but the 2016 presidential election is finally getting started, for real. Several months of primary elections begin Feb. 1 with the Iowa caucus, and soon enough, we’ll know who will be on the general election ballot come November.
One of those people could be Sen. Bernie Sanders (D-Vt.). Whether or not you’re feeling the Bern, it’s important to know how a Sanders presidency could affect you and your money. Like all presidential candidates, Sanders has identified many things he’d like to change about life in the U.S. There’s no way to know how many of his proposals would become reality if he’s elected — making such changes is a lot more complicated than proposing them — but several have the potential to significantly impact Americans’ personal finances. (We’ll be covering other candidates’ impact on your money in the next few weeks.)
Here are some of the main issues Sanders would like to address and how it could impact your finances.
1. Single-Payer Healthcare
There’s a lot of debate over how a single-payer healthcare system would affect the average American’s budget, because overhauling the system would be complicated and therefore costly. Without getting into the details (partially because Sanders hasn’t shared all of those yet), here’s what he’s proposing: Sanders is calling it his “Medicare for All” plan, and it aims to simplify the process of getting and paying for healthcare while detaching insurance from employment.
“As a patient, all you need to do is go to the doctor and show your insurance card,” reads Sanders’ website. “Bernie’s plan means no more co-pays, no more deductibles and no more fighting with insurance companies when they fail to pay for charges.”
Sanders plans to pay for the program, which his campaign estimates to cost $1.83 trillion annually, through a tax increase on those making more than $250,000 a year, premiums paid by employers and some households (dependent on income), other tax adjustments and program savings.
2. A $15 Minimum Wage
Currently, the national minimum wage is $7.25 per hour. Sanders wants to raise it to $15 per hour over the next several years. For people working minimum wage jobs, that could make a significant difference in their earnings and overall financial health. At the moment, only Emeryville, Calif., comes close with its $14.44 minimum wage, though San Francisco and Seattle have plans in place to implement $15 minimum wages in the next several years.
3. Paid Family Leave & Sick Days
Maternity leave, paternity leave and medical leave are hot topics in politics right now. Many parents don’t have the option of taking paid time off to care for new or sick children, and for those that do, it’s often an unaffordable one. Sanders proposes 12 weeks of paid family or medical leave for all U.S. workers, as well as 7 days of guaranteed paid sick days.
4. Free College
Sanders has outlined six steps he would take to making college debt-free. One of those ideas is to eliminate tuition at public colleges and universities throughout the country. For the 2015 to 2016 school year, the average in-state tuition at a public institution cost $9,410, according to the College Board, which is a 13% increase from the previous academic year. Even with the other costs of education beyond tuition, eliminating that expense could make a college degree much more affordable.
The entire plan is estimated to cost $75 billion annually, according to Sanders’ campaign website. He plans to pay for the plan by imposing what is essentially a sales tax on stocks and other investment products.
5. Student Loan Refinancing
Part of the problem with high tuition costs is the student loan debt it generates. There’s more than $1.3 trillion in outstanding student loan debt in this country, and it continues to grow as new borrowers take on loans and current balances accrue interest.
Those interest rates are a huge point of contention in the student loan world. Student loan rates are high by most consumer loan standards, and for the most part, borrowers are stuck with them. Sanders not only wants to cut interest rates in the first place, he also proposes making refinancing available so borrowers with high rates from many years ago can take advantage of today’s lower rates. (You can see how your student loan debt may be affecting your credit scores by viewing your free credit report summary, updated each month, on Credit.com.)
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