KANSAS CITY, Mo. - Despite warnings about the looming fiscal cliff, some Kansas Citians are unaware of how much going over the cliff will affect their paychecks.
During his address to the nation Friday afternoon, President Obama warned that every American’s paycheck will get smaller if Congress does not come to an agreement.
Some of the Kansas Citians we interviewed were not paying attention to the debate, even though it could mean a hefty change to their paychecks.
Those who have been following the debate told us they were scared to see how much those tax increases would affect their bottom line.
According to the U.S. Census, the average household income in Kansas City is $45,246. We used that number in Bankrate’s financial cliff calculator which uses tax policy analysis from the non-partisan Tax Policy Center.
Using one exemption and single status, it told us the yearly tax bill would go up $1350, or about $112.50 a month.
“It is that is really high,” said Stacy Winters upon seeing the figures. “I can understand 20 or 30, but 100? I'm like-- that's a lot of money!”
Winters said it will affect what she buys.
“Maybe not going out to eat as much or just little luxuries? I might have to cancel my cable or something. I don't know. I don't want to think about it really,” Winters said.
Colette Kingston said she too would have to cut back.
“It makes a difference in how much groceries I buy, how much food we eat, things we go out and do,” said Kingston.
Those cutbacks worry small business owners, like John Vargas, who anticipate they’ll feel the pinch as families cut back.
“It's going to affect my business in the fact that again people have less money to spend. Less money to spend? It means our economy isn't going to grow the way it should. They put these tax savings in years ago we need it as much now as we did then,” Vargas said.
To see exactly how the fiscal cliff could affect your paycheck, visit http://www.bankrate.com/calculators/tax-planning/fiscal-cliff-calculator/
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