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How to ’emotionproof’ your portfolio ahead of the presidential election

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Emotion-proof your portfolio: Here's what to know

Stock market volatility could increase in the run-up to the U.S. presidential election, strategists predict. That’s making some investors more anxious about what the election outcome could mean for their money. 

In a survey by the American Psychiatric Association this spring, 73% of people said they felt anxious about the election. Other polls show investors nervous about the election are more inclined to move their investments or pull money out of the market, which could derail long-term financial plans. 

“When we become emotionally charged, we become rationally challenged,” said financial psychologist Brad Klontz, a member of the CNBC Global Financial Wellness Advisory Board. “In times of uncertainty, which is typical around election periods, we are really prone to just absolutely destroy ourselves financially.”

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Here are four steps that Klontz and other experts recommend to keep election jitters in check and help emotionproof your portfolio: 

Picture your goal

If you’re feeling anxious about how the election is going to impact your wallet, take a step back and evaluate your goals. If you’re invested for long-term goals, picture what those are and stay focused.  

“If your goal is to pay off your mortgage, or buy a car, put a picture on your front door, put it in your office, that’s your vision, that’s your goal that you’re working for,” said Erika Wasserman, a financial therapist in Miami. “The election that’s going to happen is going to happen. Your input isn’t going to change that one way or the other, for the most part.” 

Dig deep to understand what is really concerning you. Keep a journal to write down your worries and see if there a common theme that surfaces.

Ask yourself: Is your worry fact, or fiction? 

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Analyze your fears to determine their risk. It’s easy to come up with “what if” scenarios, but the chances of those worries becoming reality are often smaller than imagined. 

The fact is the presidential election is months away and until then, the outcome is unclear. House and Senate races will also play a large role in actual policy changes. 

Plus, political promises don’t often become reality. Playing on emotions is a tactic used by campaigns to drum up support. 

“We’re very emotional, and so that’s actually the biggest risk we’re facing right now,” said Klontz, who is a Boulder, Colorado-based psychologist and certified financial planner. He notes that the stock market tends to be volatile before the election and goes up after the race is determined, regardless of political party. 

“Because all of a sudden things aren’t quite so uncertain, and so everyone relaxes a little bit,” he said. 

Once you have your worries written down, go back and put a true or false next to it, “Then you can deal with the stuff that’s the truth, and the stuff that’s fiction put aside for another day until that really comes about,” Wasserman said.

Revisit your goals and investments

Now is a good time to use your worries to drive action by revisiting your goals and evaluating your portfolio. With the market fairly stable and the economy healthy, consider your time horizon and the diversity of your investments. 

“That’s a really good thing to do, no matter what, every couple years,” said Megan McCoy, a financial therapist and professor of financial planning at Kansas State University.

You may want to consult with a tax and financial professional to make sure you are putting your money in the right type of accounts, understanding that there is uncertainty.

“What is the wisest decision you can make with the information you have now, because we really can’t predict the future.” Klontz said.

‘Spread out the all the stressors’

Some people will let their worries spiral, thinking the outcome of the election could cause the stock market to crash, inflation to worsen and put their current job or new employment opportunities in jeopardy. McCoy recommends using that stress to take action over what you can control.

“Spread out all the stressors, all the worries, maybe write them all down to get to the actual root of your fears,” she said.

Then map out the steps that are in your control that you plan to take to address these issues, she added, “use that as an outlet for the stress and anxiety.”

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Trump plan to freeze funding stymies Biden-era energy rebates for consumers

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Some states have stopped disbursing funds to consumers via Biden-era rebate programs tied to home energy efficiency, due to a Trump administration freeze on federal funding enacted in January.

The Inflation Reduction Act, passed in 2022, had earmarked $8.8 billion of federal funds for consumers through two home energy rebate programs, to be administered by states, territories and the District of Columbia.

Arizona, Colorado, Georgia and Rhode Island — which are in various phases of rollout — have paused or delayed their fledgling programs, citing Trump administration policy.

The White House on Jan. 27 put a freeze on the disbursement of federal funds that conflict with President Trump’s agenda — including initiatives related to green energy and climate change — as a reason for halting the disbursement of rebate funds to consumers.

That fate of that freeze is still up in the air. A federal judge issued an order Tuesday that continued to block the policy, for example. However, it appears agencies had been withholding funding in some cases in defiance of earlier court rulings, according to ProPublica reporting.

In any event, the freeze — or the threat of it — appears to be impacting state rebate programs.

“Coloradans who would receive the Home Energy Rebate savings are still locked out by the Trump administration in the dead of winter,” Ari Rosenblum, a spokesperson for the Colorado Energy Office, said in an e-mailed statement.

The U.S. Department of Energy and the White House didn’t return a request for comment from CNBC on the funding freeze.

In some states, rebates are ‘currently unavailable’

Consumers are eligible for up to $8,000 of Home Efficiency Rebates and up to $14,000 of Home Electrification and Appliance Rebates, per federal law.

The rebates defray the cost of retrofitting homes and upgrading appliances to be more energy efficient. Such tweaks aim to cut consumers’ utility bills while also reducing planet-warming carbon emissions.

California, the District of Columbia, Maine, Michigan, New Mexico, New York, North Carolina and Wisconsin had also launched phases of their rebate programs in recent months, according to data on an archived federal website.

All states and territories (except for South Dakota) had applied for the federal rebate funding and the U.S. Department of Energy had approved funding for each of them.

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The Arizona Governor’s Office of Resiliency said its Home Energy Rebates programs would be paused until federal funds are freed up.

“Due to the current federal Executive Orders, memorandums from the White House Office of Management and Budget, and communications from the U.S. Department of Energy, funding for all Efficiency Arizona programs is currently unavailable,” it said in an announcement Friday.

Rhode Island paused new applications as of Jan. 27 due to “current uncertainty” with Inflation Reduction Act funding and executive orders, according to its Office of Energy Resources.

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The Georgia Environmental Finance Authority launched a pilot program for the rebates in fall 2024. That program is ongoing, a spokesperson confirmed Monday.

However, the timeline for a full program launch initially planned for 2025 “is delayed until we receive more information from the U.S. Department of Energy,” the Georgia spokesperson explained in an e-mail.

However, not all states have pressed the pause button: It appears Maine is still moving forward, for example.

“The program remains open to those who are eligible,” Afton Vigue, a spokesperson for the Maine Governor’s Energy Office, said in an e-mail.

The status of rebates in the eight other states and districts to have launched their programs is unclear. Their respective energy departments or governor’s offices didn’t return requests for comment.

‘Signs of an interest’

While the Trump administration on Jan. 29 rescinded its memo ordering a freeze on federal grants and loans — two days after its initial release — the White House said the freeze nonetheless remained in full force.

Democratic attorneys general in 22 states and the District of Columbia filed a lawsuit against the Trump administration, claiming the freeze is unlawful. The White House has claimed it is necessary to ensure spending aligns with Trump’s presidential agenda.

David Terry, president of the National Association of State Energy Officials, said he is optimistic the rebate funding will be released to states soon.

“For these two particular programs, I do not think [the freeze] will stymie the programs,” Terry said. “I see signs of an interest in moving them forward and working with the states to implement them.”

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Social Security Fairness Act benefit increases to arrive this spring

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Lump sum payments to begin arriving in February

In a new update released on Tuesday, the SSA said it will begin issuing retroactive payments in February. Most people will receive the one-time payment by the end of March, according to the agency.

The SSA plans to process the increase to monthly benefits starting in April.

The new timeline “supports President Trump’s priority to implement the Social Security Fairness Act as quickly as possible,” Social Security acting commissioner Lee Dudek said in a statement.

“The agency’s original estimate of taking a year or more now will only apply to complex cases that cannot be processed by automation,” Dudek said. “The American people deserve to get their due benefits as quickly as possible.”

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Among those affected include some teachers, firefighters and police officers in certain states; federal employees who are covered by the Civil Service Retirement System and people who worked under foreign social security systems, according to the Social Security Administration.

What affected beneficiaries should know

Retroactive payments, which most people should receive by the end of March, will be deposited directly into bank accounts on file with the Social Security Administration.

All affected beneficiaries should receive a notice by mail from the Social Security Administration with details about their retroactive payment and new benefit amount. Those notices should come two to three weeks after the retroactive payments, according to the agency.

If your direct deposit information or current mailing address are up to date with the agency, no action is needed, according to the agency. If you want to double check the information the agency has on file, you may sign into your personal online account or call the agency.

If you want to ask about the status of your retroactive payment, the Social Security Administration urges you to hold off until April.

Beneficiaries should also wait until after they have received their April monthly check before contacting the agency to ask about their new benefit amount.

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The average IRS tax refund is 32.4% lower this season. Here’s why

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The average tax refund is 10.4% lower than last year according to the latest Internal Revenue Service data, and inflation is taking more of those dollars.

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The average tax refund this year is down 32.4% compared to last year, according to early filing data from the IRS. 

Tax season opened on Jan. 27, and the average refund amount was $2,169 as of Feb. 14, down from $3,207 about one year prior, the IRS reported on Friday. That figure reflects current-year refunds only.

However, the Feb. 14 filing data doesn’t include refunds receiving the earned income tax credit or additional child tax credit, which aren’t issued before mid-February, the IRS noted. The previous year’s filing data included tax returns claiming these credits. The value of these tax breaks can be substantial, even resulting in five-figure refunds, in some cases.

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Typically, you can expect a refund when you overpay taxes throughout the year via paycheck withholdings or quarterly estimated payments. By comparison, there’s generally a tax bill when you haven’t paid enough.

Filing season numbers will ‘even out’

‘Don’t call the IRS’ for refund updates

The latest filing statistics come amid mass layoffs for the agency as Elon Musk’s so-called Department of Government Efficiency, or DOGE, continues to cull the federal workforce

It’s unclear exactly how the staffing reduction could impact future taxpayer service. But experts recommend double-checking returns for accuracy to avoid extra touch points with the agency.

“Don’t call the IRS looking for your refund,” said Tom O’Saben, an enrolled agent and director of tax content and government relations at the National Association of Tax Professionals. 

You can check the status of your refund via the agency’s “Where’s My Refund?” tool or the IRS2Go app, which is “available 24 hours a day,” O’Saben said.

Typically, the agency issues refunds within 21 days of a return’s receipt. But some returns require “additional review,” which can extend the timeline, according to the IRS.

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