Trump’s ‘Big, Beautiful Bill’ Is a ‘Mixed Bag’ for Advisors

The Trump administration’s “big, beautiful bill” isn’t just keeping Congress up all night.

Financial advisors have been poring over Trump 2.0’s signature legislation, weighing the consequences of the One Big Beautiful Bill Act, which is expected to be passed by the House of Representatives today, taking it a step closer to landing on President Trump’s desk by his July 4 deadline. Some worry about adding trillions of dollars to the already ballooning national debt, while others applaud extending the Tax Cuts and Jobs Act, set to expire next year. If passed, the legislation will have monumental impacts on wealth managers and their clients, including tax and estate planning, for years to come.

“The thought by the current administration is that lower interest rates, increased economic growth and revenue from tariffs will result in lowering the deficit,” said Tom Balcom, founder of 1650 Wealth Management in Lighthouse Point, Florida. “Only time will tell if their game plan holds true.” 

Midterm Mayhem

Many advisors agree that extending some form of the TCJA will be a net positive for clients. Maintaining those cuts, along with other economic stimulators, could boost the economy and help curb the deficit, Balcom said. “If not, the mid-term elections may prove difficult for the Republican party,” he said. “I have clients on both sides of the political spectrum, so I have to remain neutral (Switzerland) when it comes to this topic.”

There is an argument for a modest economic boost with lower tax rates, but the evidence is a “mixed bag,” said Kevin J. Brady, CFP at Wealthspire Advisors in New York City. Instead of addressing the deficit, individual tax rates are being kept low, and “expensive, gimmicky” changes like not taxing tips, overtime and Social Security are grabbing headlines. “As a professional, I will advocate for my clients in whatever form the final bill takes, but it is a bad piece of legislation in my personal view.”

One Tip Wonder. Trump’s bill is filled with short-term rewards, but has the potential to create very long-term pain, said Alex Caswell, a planner at Wealth Script Advisors in San Francisco, adding that he was “shocked” by the tax cuts for the wealthy and how little the legislation does for lower-income Americans. According to taxact.com, the bill’s top-level provisions include:

• State and local tax (SALT) deduction cap increase, mainly impacting filers in high-tax states like New York, California, or New Jersey. 
• No tax on tips, which could mean more take-home pay for workers.

Tips are often paid in cash, however, and probably won’t move the needle, Caswell added. “We are already seeing cracks due to our debt via downgrades, weak Treasury auctions, and a dropping dollar,” he said. “Eventually, someone will need to make a hard call to rein in the deficit.”