The American Rescue Plan is About People, Not Just Dollars
Tara’s after-school enrichment program was just starting to take off when COVID-19 shuttered public schools in March of last year. Not long after her small business was shut down, Tara’s husband contracted COVID-19. He passed away a few weeks later. By the time Tara got the virus herself, she had lost access to her husband’s health insurance, and she couldn’t afford COBRA. She had to pay for her medical treatment using a credit card.
Our nearly 500,000 members are primarily working families, earning, on average, less than $35,000 a year, and have been hard hit by lost work due to the pandemic.
The American Rescue Plan will mark a life-saving and life-changing step in America, charting a new course for the future of SaverLife members. COVID-19 has been an uneven burden—essential workers, low-income families, women, people of color, people with disabilities, and others have faced tremendous hardship. Not only have our members disproportionately endured more of the impact of the disease itself, but they have also lost income, employment, healthcare, and housing. The historic signing of this bill means help is on its way. Millions of families will benefit from its passage. Here are a few ways the bill will help those who need it most.
Providing Direct Cash Assistance
The $1,400 per-person checks included in the Rescue Plan will put cash directly into the hands of SaverLife members. For SaverLife member Rachel, who lost her job as an office manager and has struggled to find a new job with commensurate pay, the stimulus payment will replenish a savings account to help her weather future financial turmoil.
Stimulus payments will help our members build a base of financial stability. Last year, we published research showing that direct cash payments helped households pay down growing credit card debt, provided food and housing security, and rebuilt savings balances.
Expanding Benefits for Low-Income Parents
Jamila is one of many working parents who have struggled to make ends meet during the pandemic. Her job cut her hours, thereby decreasing her income. With her kids remote-learning at home, her expenses shot up. The parents of remote-learning children are 35% more likely to say caring for children makes it more difficult to earn money. Between the loss of income and the higher costs, families like Jamila’s have faced an impossible financial squeeze that has now lasted for an entire year. The American Rescue Plan will help with childcare expenses so that all Americans can provide for their families.
The American Rescue plan expands the Child Tax Credit by increasing the amount of money families can claim. More low-income families will fully qualify and be eligible to receive the credit as advance checks of about $300 a month per child starting in July, giving families access to the benefit before tax season. The Plan also makes childcare more affordable by increasing the dependent and child care credit.
Eighty percent of SaverLife members have dependent children, and many of them have struggled to survive with increased costs and decreased income during the pandemic. This expanded tax credit will cut child poverty in half by putting more money directly into the pockets of SaverLife members in need of immediate financial assistance.
Broadening Access to Healthcare
As millions of Americans and SaverLife members have lost their jobs over the past 12 months, many have also lost healthcare access, like Tara. For our members who have had to stay home to care for children or sick family members, they have simultaneously faced a loss of earnings and higher bills.
The American Rescue Plan makes COBRA available for free for people who have lost jobs or hours, eliminates income caps on who qualifies for reductions in monthly insurance premiums, limits the amount households pay for health insurance to 8.5% of their income, and boosts subsidies to lower-income consumers. This will lower healthcare costs for almost 14 million people and ensure that no one is left without health insurance because they can’t afford it.
Helping Families Stay in Their Homes
The America Rescue Plan allocates almost $43 billion to provide housing financial assistance for families hard hit by the pandemic. Those making 80% of area median income—which includes over 90% of SaverLife members—and experiencing financial hardship would receive financial assistance. Lower-income families that have been unemployed for three months or more would be given priority for assistance.
For example, Sarah and her husband are hoping they can save enough money to get an apartment closer to his job, or to purchase a used RV. But with all the financial difficulties they are facing, Sarah isn’t sure how they will afford a new home. The Plan’s housing assistance could help Sarah’s family, and other families in similar situations, secure safe housing.
Continuing to Provide Extra Unemployment Benefits
After the pandemic decimated their revenue, the owners of the small business where Rachel worked laid her off. She had worked for the company for 18 years and been planning to retire in a few years.
Millions of Americans lost work because of the COVID-19 pandemic through no fault of their own. The American Rescue Plan will extend federal unemployment benefits through September 6, 2021, at $300 per week, with tax forgiveness on the first $10,200 of unemployment income.
A Much-Needed Lifeline & A New Path Forward
The American Rescue Plan will not only rescue millions of Americans from poverty, it will also be a lifeline for millions of people across the country, like Jamila, Sarah, Rachel, and Tara, who are working hard to put food on the table and keep a roof over their heads.
We applaud President Biden, Vice President Kamala Harris, members of Congress, and countless others—who voted, participated, and spoke up—to collectively bring forth this plan to help our most vulnerable Americans. We support this legislation as the first of many steps that need to be taken to make this a truly equitable recovery, especially for women and people of color.
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