George Kamel - The Truth About Trump’s “Big Beautiful Bill” (How It Affects Your Wallet)

Episode Date: July 28, 2025

💵 Start your free budget today. Download the EveryDollar app! Today, we’re breaking down President Trump’s “Big Beautiful Bill” by unpacking the highlights, andtalking about how the changes will impact your wallet. Next Steps: • 🎥 Watch my video The Biggest Tax Changes in 2025. • 📈 Are you on track with the Baby Steps? Get a free personalized plan. • 📙 Order my book, Breaking Free From Broke, in hardcover.   Connect With Our Sponsors: • Get 20% off when you join DeleteMe. • Learn more about opening a high-yield savings account with Laurel Road. • Get up to 40% off Cozy Earth with code GEORGE. Explore More From Ramsey Network: 🎙️ The Ramsey Show 🍸 Smart Money Happy Hour 💸 The Ramsey Show Highlights 🧠 The Dr. John Delony Show 💡 The Rachel Cruze Show 🪑 Front Row Seat with Ken Coleman 📈 EntreLeadership   Ramsey Solutions Privacy Policy Learn more about your ad choices. Visit megaphone.fm/adchoices

You asked for it, I answered. Today we're talking about President Trump's Big Beautiful Bill. Formal name, One Big Beautiful Bill Act, or OBBBA for short, also Abba. Not to be confused with Aba, which I assume is Trump's favorite band to dance to outside of YMCA. It's a sweeping piece of legislation that introduces major changes to tax policy, health care, education, and federal spending, a lot of stuff that affects you. So we're going to break it all down, unpack the highlights, and, talk about how the changes will impact your wallet.

Now, when Trump called this piece of legislation big, he wasn't lying, unlike when he told us he'd be the healthiest president in history. Filo fish has omega-3s, that doesn't count. Love my omega-3s. But for real, this thing is almost 900 pages, and it covers pretty much everything imaginable, including tax cuts for whaling captains and fishermen from Western Alaskan villages. Page 433, baby, your boy sourced.

So instead of focusing on every little detail inside this bill, which would take until my two-year-old graduate high school, will cover the five major changes that will make the biggest impact. Starting with change number one, making Trump's 2017 tax cuts permanent. Well, as permanent as you can make anything in today's America. Eight years ago, during his first term, Trump signed a series of tax cuts into law

that included increases to the standard deduction and the child tax credit, along with tax bracket adjustments. Originally, those cuts were set to expire in 2025, but thanks to the big beautiful bill, they're here to stay. At least until the next guy or gal changes it. Katie Perry, 2028, make it happen. It can't get worse. They ask you how you are you. You just have to say that you're fine. Here's what that looks like. The standard deduction for 2025 will go up to $15,750 for single filers, an increase of $750

and married couples filing jointly are getting a $1,500 bump up to $31,500 total. An adult 65 and older will get a bonus deduction of $6,000 if they meet certain income requirements through 2028. And the child tax credit will get a $200 boost, bringing it up to $2,200 per child. So get to baby making. Daddy's got to save on Texas. Excuse me, what? Now, at least on the surface, this is all good news for many Americans. More money in your pocket and less that you have to send to the government, typically a positive development. Major change number two in the Oba, no taxes on tips, or money.

or overtime pay, at least to an extent. You see, this change only applies to the first $25,000 you make in tips, and the first $12,500 you make an overtime pay as an hourly worker, which means once you hit $12,501, Uncle Sam is going to enter the chat. And as with most of these deductions, the benefit will decrease or completely go away if you make too much money. And by the way, these tax breaks are set to expire after 2028. And this change actually comes in the form of a deduction,

which just means any money you make from tips are working overtime, up to the limit in each category, doesn't count toward your taxable income. And since those deductions are above the line, you're eligible for them even if you don't itemize. So is this a good thing? Well, depends on who you ask. As the Washington Post reported back in May, some economists have warned that this new policy may just incentivize employers to start paying their workers less by reclassifying some salaries as tips. But if you rely on tips for a large portion of your income, it means you'll get to keep more. of that money to the tune of thousands of dollars back in your pocket every year. Same goes if you're consistently working overtime.

So the bottom line, as with most things that come out of DC, this development isn't nearly as heroic or catastrophic as some people want you to think. Up next, we've got free money for babies. Yep, all you need these days to get a free check from the government are some chubby cheeks, snow teeth, and fecal incontinence. That's disgusting! With the big beautiful bill, every U.S. citizen born between January 1, 2025, in December 31st, 2028 will automatically receive a $1,000 deposit into an investment account,

which will be set up and funded by the U.S. Treasury. The funds will be invested into the stock market on the child's behalf, and you can add up to $5,000 annually in after-tax dollars to these accounts until the child turns 18. Now, the whole idea here is that you can use these accounts to get a jumpstart on investing for your kids to go to college or even their retirement. But beyond the $3,000, they're really not all that helpful. And that's because unlike a 529 plan or an education savings account, these so-called Trump accounts have practically no tax advantages.

You fund them with after-tax dollars and all the growth gets taxed when you withdraw it, regardless of how you use the money. So my recommendation, absolutely take the $3,000. Let it sit in the account and grow for as long as possible and do the rest of your investing elsewhere. All right, major change number four from the Big Beautiful bill, a student loan shakeup. Trump's new policies are giving student loans quite the facelift.

So move that bus because it's time for extreme makeover loan edition. The big news here is that the repayment plans that have been available for the last few years are no more. Anyone borrowing after July 1st, 2025 will have two main options. Number one, a standard repayment plan with fixed monthly payments that stretched from 10 to 25 years depending on how much you owe. And number two, a new income-driven plan called the repayment assistance plan, which ties your monthly payment to your income. somewhere between 1 and 10% and forgives whatever's left after 30 years. But it's not just for payment plans getting a shake-up. Grad plus and parent-plus loans are also going through a major transformation,

kind of a glow-down, if you will. Grad-plus loans used to let students borrow up to the full cost of attendance. Translation, you could basically swipe the federal loan card for whatever your school billed you. But starting July 26, that's over. No new borrowers will be accepted into the grad plus program, and all other federal loans will come with new borrowers. So if you were planning on financing your underwater basket weaving PhD, you may be fresh out of luck. Same story for Parent Plus loans. Parents used to be able to borrow the whole shebang for their

kids' college costs. But starting July 1st, 2026, there's going to be a $65,000 lifetime cap per student and a $20,000 annual limit, which still feels like a lot until you see the price tag of that self-published textbook, your sociology professor, forced you to buy. And while we're on the topic of education, 529 plans are getting an update too. Now, you can use the money in a 529 before college to pay for additional educational expenses like tutoring or certain therapies for students with disabilities. And after high school, you can now spend 529 funds tax-free on qualifying workforce training and similar programs in addition to traditional college, which honestly is a great development

because non-degree programs like trade schools are an amazing option for a lot of students these days. All right, the fifth and final major change from the ABBA could have a major impact on the car market and I'll break it down in just one second. But first, let me tell you about something else that could have a major impact under savings, and that's opening up a high-yield savings account with online bank Laurel Road, one of the sponsors of today's video. Unlike most dusty old traditional savings accounts at brick and mortar banks, which offer horrible interest rates, Laurel Road offers competitive top-tier APY, which lets your money grow way faster. Plus, they never

charge any sneaky fees, and there's no minimum balance required to open an account. And best of all, your deposits with Laurel Road are FDIC insured. so you know your money's safe and sound. So open an account today by going to laurel road.com slash George or click the link in the description below. And before we get back to talking about how Trump's new bill affects your wallet, let's talk about Delete Me, another sponsor of today's video. Delete me combs through hundreds of data broker sites

to get rid of your personal info and make sure it doesn't fall into the hands of anyone's shady. And that's a big deal, since online scams are becoming a lot more common and sophisticated these days. Plus, every few months they'll send you a customer report letting you know exactly what they've done and how much time they've saved you. And so far, they've removed me from over 240 data broker sites and save me 94 hours of time.

And right now, you can get 20% off their annual plans by going to join deleteme.com slash George or click the link in the description. Okay, major change number five in the big beautiful bill, updates to the car market. For starters, this bill puts an end to the $7,500 new EV tax credit, which means that brand new cyber truck you've had your eyes on will now cost you almost $8 grand more. Now, is this some vengeful post-breakup move Trump-F? pulled on Elon, jury's still out on that.

Hello? Elon? You were going to break up with him anyway? He just did it for... Wait, how are you watching this video live? It's not even out yet. We haven't even edited. You have access to the cameras? Shut up.

Guys, he does it from SpaceX, he said. Start what? Listen, now's not that... I know. I know. We'll ride around later. I know you want to be in millionaires and cars getting coffee, but we haven't done a billionaire in car getting coffee. I don't know how to do that yet. Just a single billionaire. I'm not there yet. One sign? Okay. You'll share a billion with me just so we can do the video.

That's a true friend. Thanks, bud. Love you too. Love you. Okay, I got to go. Bye-bye. Sweet guy. Back to EV tax credit stuff. This change will go officially into effect at the start of October 2025. So if you were planning to take advantage of the credit, you'll need to wake up before September ends. Wow, that's an old reference. Another change in the car world? Anyone who buys a new American-made vehicle over the next four years can deduct up to $10,000 annually in interest paid on auto loans, though the deduction decreases

if you make more than $100,000 a year or $200,000 for couples. Now look, if you've been watching this channel for long enough, you know how I feel about buying brand new cars and about car loans. I probably don't even have to remind you that the typical new car loses about 60% of its value over the first five years. But in case you've forgotten, allow me to remind you, new cars lose about 60% of the value for the last five years. Okay, I get it. So I'm giving this part of the big beautiful bill a big beautiful thumbs down, because it incentivizes going into debt for a depreciating asset, which is always dumb.

And why not just let us all deduct $10,000 annually if we buy an American car used or new with debt or with cash? And speaking of debt, I would be remiss not to mention that the Congressional Budget Office expects this bill to add over $3 trillion to our national debt. Yeah, tax cuts. Add to the deficit. What's going on with that? Which means that even though this bill will certainly be a positive development for lots of people, it's coming with a steep cost to America's future that unfortunately our kids will just have to deal with.

Now, like I said at the beginning, these are just the highlights of the bill. It covers a metric ton of other stuff, including increasing the state and local tax deduction by 400%, adding $1,000 above-the-line charitable giving deduction, making more people eligible for HSAs, and adjusting the requirements for Medicaid. But the five changes we went over in this video are the ones with the highest likelihood of affecting your personal finances. So, what are my overall takeaways on the Big Beautiful Bill? I'll give you three. Number one, for most people, it won't affect your life all that much. Now, some people will see a huge benefit from this, and others are going to be hurt by it.

According to the Congressional Budget Office, this bill's Medicaid updates could cause almost 12 million people to lose insurance coverage by 2034. That sucks. But on the bright side, more than 8 and 10 households overall would get a tax. cut in 2026 according to the tax policy center. So at the end of the day, this bill's not going to rip the country to shreds, and it's also not going to be anyone's savior. If your finances are a mess, no politician or bill is going to dig you out of that hole, but you always have the power to do it yourself. Number two, don't spend money just to get a tax deduction. All right, a tax deduction is not free money. It just decreases your taxable income. So while deductions do lower your overall tax bill,

it's not a one-to-one swap. A $25,000 deduction does not mean you save $25,000 in tax. So moral of the story, it's almost never worth the squeeze to make financial decisions purely based on the tax implications. Just because you have a coupon doesn't mean you should go shopping. Number three, you should take advantage of what you're eligible for. Now, don't go do something dumb like buy a new car or take out student loans, but if you qualify for one of these cuts or deductions, take advantage of it. And by the way, the tax updates we've gone over today aren't the only ones that could save you money when you file next year. I recently made this video breaking down other potential money-saving tax updates for 2025. So click here to watch it next, or you'll see you.

use the link in the description. That's it for today. Be sure to hit like on this video if you learn something and click that big beautiful subscribe button if you haven't already. Thanks for watching. We'll see you next time.