Financial experts pinpoint how Biden's relief plan could contribute to the reshaping of American families
13 March 2021
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While most American workers have had their eye on the Democrat-backed $1.9 million stimulus package due to the direct payments and enhanced unemployment benefits it provides, there is one other provision that has also caught the eye of financial experts.
According to NPR, financial experts are confident that the initiative could be a critical tool to combat poverty in the United States while helping to improve the finances for lower-income families.
Under the stimulus package, a substantial number of American parents will receive "an allowance of $250 a month for each child and $300 for kids under six," the publication reports. Although the federal government has already offered American families a limited tax incentive for parents, financial experts have outlined a number of ways the latest provision could be a game-changer.
The publication highlights:
First, it vastly expands the amount of money provided to families – 50% to 80% more for each child.
Second, it's designed to be given out monthly, like an allowance, rather than just once a year. And third, parents with little or no income still qualify for the full amount.
It also outlines how the new allowance provision differs vastly from the previous limited tax break. According to Kris Cox, deputy director of federal tax policy at the Center on Budget and Policy Priorities, the past tax break offered American families "nothing at all." This is landmark legislation that would really slash child poverty and target benefits to the lowest-income families that need them the most," Cox said.
For one American family, the allowances will be welcomed. In Nancy Cordiero's case, the allowance real be a new lease on life that may restore her pride. She briefly discussed how the pandemic has subsequently changed her life.
"When you have to go to the food bank, there's a lot of pride at stake and people are suffering from that," Cordiero said. "They're getting depressed over that, because all that weight is on them, just like it is on me."
She added, "It's a huge financial help because that takes away some of the burden of, 'What do I pay?' Do I pay the rent? Do I pay the utilities? Do I pay daycare? Or do I get my daughter some new clothes and new shoes for school?'"
Cordiero may not have to worry about financial preparations for the new school year with the federal government planning to kick off child allowance payments in July of this year.