The Most Consequential Money News of 2018 Probably Isn’t What You’d Think
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"If you’re carrying a lot of debt, now’s a good time to double-down on paying it off. The Fed’s expected to continue raising rates throughout 2019."

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Sensational headlines dominated the news in 2018, especially when it came to our money—from tax reform and tariffs to interest rate hikes and minimum wage fights. Each came with its own set of dramatic predictions. But did the hype match reality? Here’s what really happened.

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Tax cuts didn’t make us that much richer.

The jury’s out on whether tax reform will fulfill on its long-term promise to stimulate the economy, but the short-term impact of tax cuts was pretty minimal.

In a CNBC poll, just 32 percent of workers said their take-home pay increased as a result. And while corporations enjoyed billion-dollar windfalls—and some of that money was shared with employees via one-time bonuses—we didn’t see dramatic raises in 2018 overall. A Bankrate survey found 62 percent got no raise at all, and an AON survey found that while salaries are going up slightly next year, total compensation will actually shrink.

Related: Should You Be Earning More Money?

Minimum wage increases put $4.7 billion more in Americans’ pockets.

So if companies are still being stingy with raises, have minimum wage movements and new government rules forced up wages? Yes—in some places. In 18 states, we saw relatively modest minimum wage increases in 2018, from Alaska’s 4-cent bump to Maine’s $1 hike. The Economic Policy Institute says the new rules meant raises for 4.5 million workers, who were expected to receive $4.7 billion in new spending power as a result.

It’s hard to study the true impact of minimum wage hikes on local economies, but public discussion has spurred change. In October, Amazon voluntarily raised wages to $15 an hour—a step that could have bigger consequences than state laws, if more employers follow suit.

Multiple interest rate hikes made it harder to pay off debt.

The year began with dire predictions that the Federal Reserve (our country’s central bank) needed to raise interest rates quickly before runaway inflation (a.k.a. raising prices) attacked our economy. While the inflation fears were overstated, the Fed still raised rates four times, causing a lot of trickle-down consequences for consumers.

Those are most directly felt in the credit card market. And indeed, average credit card interest rates are around 17 percent now—about 1.5 percent higher than midway through 2017. Higher rates make it more expensive to get rid of already-tough-to-beat revolving credit card debt. Mortgage rates have climbed, too, with average 30-year fixed rates around 4.7 percent, up from 3.85 percent in 2015.

If you’re carrying a lot of debt, now’s a good time to double-down on paying it off. The Fed’s expected to continue raising rates throughout 2019.

Tariffs cost the average family less than $130.

A looming trade war with China has stolen a lot of headlines this year. It may feel like it’s stolen some stock market value from you, too, as it’s contributed to some volatile days.

It’s not easy to calculate how tariffs affect our everyday expenses, though—in part, because the greatest impact is on big-ticket items like cars, in which only some components come from China. But some number crunching from the New York Times suggests that the impact is fairly minimal at just $127 for the average household (that didn’t buy China-part-heavy products like washing machines or cars).

Even that is probably somewhat exaggerated. While tariffs are often described as an additional sales tax on goods, in reality, sellers often absorb at least part of it, like this: If a Chinese toy costs $100, and a $10 tariff is added, sellers might only raise the price to $105 or so.

After a wild ride, oil prices ended where they started.

Oil, and, by extension, gas for our cars, has been subject to wild price swings (due at least in small part to controversy from Saudi Arabia). But in the end, the national average price of a gallon of gas at the pump today ($2.37) is basically where it was a year ago ($2.43), according to AAA. Getting there was messy, however. In November, the average price of a gallon sat at $2.69. And in October, it was $2.91, almost 20 percent higher than it sits today.

Related: Here’s What We’ll Be Paying More for in 2019

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