Wallet Watch: Will the Senate’s ‘Big Beautiful Bill’ Ease or Squeeze Your Family Budget?

By James Farias
Founder & CEO, Relief Strategies, LLC

Quick Summary

The Senate’s “Big Beautiful Bill,” signed into law on July 4, 2025, is the most sweeping tax and spending overhaul in years. This article covers:

The major tax cuts and credits, and who benefits most
Changes to government programs, unemployment, and healthcare
How household budgets, disposable income, and debt repayment will be affected
What these changes mean for debt relief and settlement services
Real-world perspectives from experts and families

If you want to know how the new law will impact your wallet, read on for a breakdown of the winners, losers, and what to watch for next.

Introduction

On July 4, 2025, President Trump signed the Senate’s “Big Beautiful Bill” into law, capping months of debate over the future of tax policy and government spending in the U.S. This comprehensive legislation touches nearly every American household, with changes to income taxes, credits, healthcare, and social programs. For families already feeling the squeeze of inflation and rising debt, understanding how these changes will affect day-to-day finances is more important than ever.

Major Financial Provisions in the Bill

Tax Cuts and Credits

The bill extends and expands many of the 2017 Tax Cuts and Jobs Act (TCJA) provisions, including lower individual income tax rates and higher standard deductions. 1
New or expanded tax credits target working- and middle-class families, such as a larger deduction for overtime pay and enhanced credits for seniors. 9
The Child Tax Credit (CTC) and Earned Income Tax Credit (EITC) are modified, with eligibility tightened in later years, impacting some low-income households. 1
The bill also introduces a temporary deduction for “qualified overtime compensation” for those earning up to $160,000, available from 2025 to 2028. 9

Spending and Program Changes

Medicaid faces roughly $930 billion in cuts over the next decade, with potential implications for low-income families’ healthcare access. 6
Adjustments to the Supplemental Nutrition Assistance Program (SNAP) restrict future benefit increases to inflation, limiting potential growth in food assistance. 2
The bill increases the federal debt limit by $5 trillion to accommodate the expanded tax cuts and spending. 7

Impact on Household Budgets

Disposable Income and Tax Burden

Most households will see an increase in after-tax income, especially in the next few years. Middle-income families are projected to benefit the most, with after-tax incomes rising by up to 6.3% in 2026. 1
Lower-income households see modest gains initially, but by 2034, some of these gains reverse as tighter eligibility for credits like the CTC and EITC take effect. For the bottom 20% of earners, after-tax income could fall by 0.4% on a conventional basis in 2034, though economic growth may offset this slightly. 1
High-income households benefit from permanent extensions of certain tax cuts, but the largest proportional gains are for those earning under $50,000. 3

Household Expenses and Program Support

Cuts to Medicaid and stricter SNAP rules may increase out-of-pocket costs for healthcare and food for vulnerable families. 6, 2
The bill’s economic modeling suggests overall GDP growth of 1.2%, which could boost job opportunities and wages, but also risks higher deficits and future interest costs. 1

Short- and Long-Term Economic Effects

Consumer Debt Trends

With more take-home pay, many families may have greater capacity to pay down revolving debt in the short term. However, reduced federal safety nets could leave households more exposed if economic conditions worsen.
The bill’s large increase in federal deficits, estimated at $3.8 trillion over the next decade, even after accounting for growth, raises concerns about future inflation or interest rate hikes, which could increase borrowing costs for consumers. 1

Potential for Financial Strain

While many will see relief in the form of lower taxes and higher credits, the expiration or tightening of key benefits in later years could strain budgets for lower-income families, especially if healthcare or food costs rise. 1, 6, 2
Middle-income families are likely to see the biggest boost to disposable income, at least through 2026. 1

Cartoon shark character Shady Pay in a business suit holding a pen, with quote: “A little extra cash now and a lot less help later? That’s my kind of trade.”

Implications for Debt Settlement and Relief Services

The initial increase in disposable income may help some households avoid default or delinquency in the short term, reducing immediate demand for debt relief. 1
However, as program cuts and tighter credit eligibility take hold, and if interest rates rise due to higher deficits, more families could find themselves struggling with debt in the coming years.
Debt relief companies should prepare for increased inquiries from lower-income households and those affected by changes to Medicaid and SNAP, as well as potential regulatory scrutiny as the landscape shifts. 2, 7, 9

Voices from the Field

“Those making less than $50,000 receive the largest proportional benefit from the new tax relief, but the long-term impact for the lowest earners is less clear as some credits tighten.”
~Joint Committee on Taxation 3

“The bill’s tax cuts will put more money in Americans’ pockets, but the cuts to Medicaid and other safety nets could leave some families more vulnerable.”
~Policy analyst, Holland & Knight 4

Anecdotally, some families report optimism about higher take-home pay, while others worry about losing access to healthcare or food assistance as program rules change. For example, a single parent working overtime may see a tax break, but if they rely on Medicaid or SNAP, they could face higher costs elsewhere. 8

Final Thoughts

The Senate’s “Big Beautiful Bill” delivers immediate tax relief for most households, with the largest gains for middle-income families. However, cuts to healthcare and food assistance, as well as tightening eligibility for key credits, mean the long-term outlook is mixed, especially for lower-income Americans. As always, the best defense is to stay informed, budget carefully, and seek professional guidance if you’re facing financial strain.

Need help deciding if settlement is the right step for you, or what to do next?
Relief Strategies can walk you through your options and help you protect your future while addressing the stress today.

👉 Visit ReliefStrategies.com or contact us at (888) 870-7922 for a free consultation.

About the Author

James Farias is the CEO of Relief Strategies, LLC, a leading firm dedicated to helping individuals achieve financial freedom through effective debt relief solutions. With over 30 years of business leadership experience and a deep passion for empowering others, James has guided countless clients through the process of reducing debt and regaining control of their finances.

Recognizing how quickly debt can overwhelm even the most disciplined individuals, James focuses on strategies that lower monthly payments, relieve financial stress, and unlock new opportunities. His mission is to help people move beyond financial hardship and build a more secure future.

Connect with James on LinkedIn or visit Relief Strategies to learn more about how he and his team can assist you on your journey to financial wellness.

Sources:

Tax Foundation, “One Big Beautiful Bill Act Tax Policies: Details and Analysis” 1
Congress.gov, “One Big Beautiful Bill Act” 2
Senate Finance Committee, “One Big Beautiful Bill: New Tax Relief Overwhelmingly Benefits Working Class” 3
Holland & Knight, “Trump Signs the One Big Beautiful Bill Act” 4
AOTA, “Senate passes new version of the One Big Beautiful Bill Act” 6
PwC, “Overview of Senate-passed version of H.R. 1, One Big Beautiful Bill Act” 7
CNBC, “What the Senate Republican tax-and-spending bill means for your money” 9
CNN, “Here’s who stands to gain from the ‘big, beautiful bill.’ And who may struggle” 8