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What a Coronavirus Vaccine Means for Your Wallet

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Throughout the U.S., the first COVID-19 vaccinations are already being administered to high-risk individuals, including healthcare workers. It will take months for enough vaccinations to become available to everyone who wants one, but there is light at the end of the tunnel. And we now have a real reason to hope the coronavirus pandemic will soon be behind us.

The vaccine will do more than just protect your future health, though. It could also have a profound impact on the economy -- and on your pocketbook. Here's what you need to know about how COVID-19 vaccinations could affect your financial situation.

How much the vaccine itself could cost

According to the Centers for Medicare & Medicaid Services, you shouldn't have to pay any money for the vaccine itself. The government provided funding to drug companies for the development of the vaccine and, in exchange, required that Americans have free access without coinsurance costs or copays.

Some providers, however, may charge fees for administering the free shots. These fees should be covered by insurance as preventive care. As such, your insurer should pay for the expense even if you haven't met your deductible yet. However, you may want to check with your insurer about whether you need to meet any requirements -- such as receiving your vaccination at certain in-network locations -- in order for it to be paid for.

If you don't have health insurance, you should still get the shot itself for free, but you may get stuck with a small fee for its administration. Shop around with different providers once the vaccine becomes widely available to compare costs.

Jobs should come back, but not necessarily all of them

Most experts, including leaders at the Federal Reserve, are optimistic about jobs coming back next year. This should happen as the vaccine is widely distributed and states can finally lift restrictions designed to slow the spread of the novel coronavirus.

The Federal Reserve now predicts the unemployment rate should fall to 5% by the end of 2021, down from the current level of 6.7%. This is still well above the 3.5% unemployment rate in February before COVID-19 took hold. And the Federal Reserve doesn't anticipate getting close to that level until 2023, when it expects the country to hit 3.7% unemployment.

Unfortunately, the reality is that COVID-19 forced many businesses to close permanently. And others may operate at reduced levels for a while, as it will take time for consumer demand to rise again. That means companies won't necessarily rush to hire even after the pandemic is behind us.

Interest rates should stay low

Interest rates on mortgages and other loans should stay low for some time. The Federal Reserve plans to continue to buy bonds and mortgage-backed securities. It will also keep its benchmark rate close to 0% for the foreseeable future. That's the rate at which banks can borrow from each other, and when it's low, so is the cost of borrowing.

As such, even when the vaccine starts to prompt economic recovery, you'll still be able to get affordable credit. For example, perhaps you've been unable to secure a mortgage refinance loan due to tighter COVID-19 lending restrictions or because of uncertain job prospects. If the vaccine improves your economic situation in the coming months, you may still have a chance to apply.

Your investments should probably do pretty well

COVID-19 vaccine approval news pushed the stock market up. As more positive news about increasing immunization rates is released, it's possible this will move the market even higher. If Republicans retain control of the Senate, a divided government could also have a positive impact on the market. Gridlock in D.C. is generally preferred by investors.

Of course, no one can predict with certainty what will happen to the stock market. Your best bet is to make sure you have a well-balanced, diversified portfolio invested with an affordable brokerage firm.

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