The Supreme Court and its justices are once again in the headlines — this time thanks to President Joe Biden.
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The President is calling for reforms to the Court. Biden called on Congress to establish term limits for the Court’s justices. According to a statement from the White House, “Term limits would help ensure that the Court’s membership changes with some regularity; make timing for Court nominations more predictable and less arbitrary; and reduce the chance that any single Presidency imposes undue influence for generations to come.”
If Biden’s plan is approved, here are four ways those term limits could hurt your wallet.
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Stock Market Uncertainty
As evidenced by this week’s wild roller coaster on Wall Street, uncertainty can cause big problems for the markets. As the New York Times noted, “The recent havoc has brought back an additional consideration: the risk that markets could tank in response to signs that the economy was slowing too fast.”
If Biden’s plan for Supreme Court term limits is put in place, it could bring uncertainty each time a justice is about to be replaced. This could hurt your wallet, given that this kind of uncertainty may rattle investors and send the stock market down.
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Financial Uncertainty
The uncertainty each time a new justice needs to be named could hurt your wallet in another way.
If you agree with the President’s views on finances and the economy, you may support whoever is selected for the high court. On the other hand, if you disagree with their views, the rulings they’re a part of could hurt your wallet. For instance, think about the more recent rulings on student loan forgiveness and how you felt about those decisions impacting your finances.
Your Ability to Invest
If you follow the Supreme Court closely, you likely realize the rulings can impact your money and finances. If justices are limited in the amount of time they can serve, it could hurt your wallet, with new justices being part of rulings that affect your ability to invest and make money in stocks and other investments.
For instance, take the Moore vs. United States case and ruling, which looked at whether taxpayers with specified foreign holdings could be subject to a one-time tax on the investments. The Court affirmed Congress’s authority to tax some unrealized gains.
So how could a decision like this impact you? According to Kiplinger, “…the decision could potentially lead to broader changes in tax policy in the future, which might impact how investments and wealth are taxed. This could later influence investment strategies and financial planning for a wider range of taxpayers.”
Your Financial Privacy
If you value privacy, including for your finances, Supreme Court term limits could hurt your wallet in another way.
As we saw in the Polselli vs. IRS case, your bank and financial records are probably not as private as you think. The Court ruled in this case, according to Kiplinger, “Sensitive financial information belonging not only to you if you owe taxes, but to loved ones and associates, could be accessible to the IRS without your prior knowledge.” That could mean trouble for you and your bank account, even if you don’t owe taxes.
Editor’s note on election coverage: GOBankingRates is nonpartisan and strives to cover all aspects of the economy objectively and present balanced reports on politically focused finance stories. For more coverage on this topic, please check out 3 Ways Biden’s Supreme Court Term Limits Could Help Your Wallet.
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