The S&P 500 has its best August since 1986: What today's news means for your money

Walmart will launch Walmart+; the S&P 500 rose 7% for its best August since 1986; a new payroll tax deferral takes effect; and other news affecting your money.

Twenty20 / Andy Majewski

The S&P 500 just had its best August since 1986, and your next paycheck could include fewer payroll taxes. Here's how the headlines could affect your money:

The market wraps up a record August 

August is typically a slow month for the market, but not this year. The S&P 500 rose 7% for its best August since 1986. Meanwhile, the Dow was up 7.6% for the month, and the Nasdaq, 9.6%. The indexes had their best August since 1984 and 2000, respectively.

September, however, is historically a tough month for the market, so keep your focus on the long term.

Payroll tax deferral takes effect

Tuesday marks the first day of a payroll tax deferral for some employees, stemming from an executive order President Donald Trump announced in early August. 

The order temporarily waives collection of the employee's share of Social Security taxes (6.2%). It only applies to workers whose biweekly pay is below $4,000 before taxes. 

Affected employees at participating companies will see slightly bigger paychecks for the remainder of 2020. But employers must repay the money between January 1 and April 30, 2021 — which means your paychecks early next year will be smaller than usual to compensate. 

Here's how tax brackets actually work

Video by David Fang

Walmart prepares to launch membership program

Walmart+ will launch September 15, the retail giant announced Tuesday. The membership program will cost $98/year or $12.95/month, with perks including unlimited free delivery on orders of $35 or more, fuel discounts of up to 5 cents per gallon, and access to an app to skip store checkout lines. 

Experts say whether Walmart+ or competitor Amazon Prime is a better deal depends on how you shop. Compare before you commit.

Words you've heard: ancillary revenue 

Ancillary revenue is money a company makes from products and services other than its main offerings. It's in the news because Delta Air Lines and American Airlines followed United Airlines Monday in eliminating change fees, one of their most lucrative forms of ancillary revenue. In 2019, the airline industry brought in $2.8 billion from such charges. 

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. Check out stories on Acorns + CNBC's website Grow to get smarter about your money and find the latest money news every day right here.

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