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Mortgage applications are up, and some businesses get coronavirus tax relief: How the headlines could affect your money

A CARES Act provision lets you carry back losses incurred in 2018 and 2019 as well as 2020.

Twenty/20

Markets even out after rallies, mortgage applications are way up, and how the CARES Act could help you if your business lost money this year. Here's how the headlines could affect your money.

Indexes even out after rallies

The major indexes fell Tuesday, a day after the S&P and the Dow closed at an all-time high. Markets opened slightly higher Wednesday morning. 

The market often fluctuates after big updates, like promising Covid vaccines from Pfizer/BioNTech and Moderna. But the further you pull back, the more obvious it is that the trendline generally slopes up. That's why it's good not to trade the news: News cycles are short, whereas the consequences of investment decisions are often long lasting.

VIDEO3:2003:20
How to plan for stock market downturns

Video by Stephen Parkhurst

Mortgage applications soaring

Mortgage applications were up 4% last week and up 26% from the same time last year, according to the Mortgage Brokers Association. Experts say possible reasons for the increase include the improved job market and the demand for increased space as people spend more time at home.

Although buying a home is the right decision for some, look at your personal situation before you leap. You might be better off renting if, for example, you're not sure you're going to stay in the same area or have the same size family for the next few years.

Good tax news for business owners

Suffering losses in business is no fun, but the CARES Act includes special pandemic-related rules about net operating losses that can help your cash flow. You can now carry back losses incurred not only in 2020 but also in 2018 and 2019.

Words you've heard: net operating loss (NOL)

A net operating loss occurs when a business has more deductible expenses than income. A helpful IRS code allows these businesses to benefit from these deductions in future years rather than simply invalidating them.

Although the daily news can have an impact on your wallet, remember to take a long-term outlook when it comes to decisions on spending, saving, and investing.


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