The fiscal cliff is looming as a result of a deal made last year between the President and Congress. What it is, is an agreement to increase taxes while cutting spending (in areas such as defense and education) that will come into effect on December 31st. The prevalent economic analysis shows that the economy, which is slowly starting to edge out of a recession, will be plunged backwards under the strain of such a change. As of now, the President and Congress have not been able to reach an agreement to prevent the US economy from falling off of the cliff. What does it mean for you? 

Unfortunately, it does have the potential to effect government-funded loans. Grant funding and loans would likely see a cutback. Other parts of education that would likely see cutbacks are school programs for special-needs and disadvantaged students.

Homeowners are the least likely to be adversely impacted. Both Republicans and Democrats have a strong interest in stimulating the housing market, as it is essential to economic growth. Houses have been - and will continue to be - a holdout tax shelter. 

While the Republicans initially took the stance that they will not allow any tax raises under any conditions, Republican politicians are beginning to relent. Inc.com's David Lonsdale points out that public sentiment is on the side of the Democrats. One of the cornerstones of Obama's campaign was higher taxes for the wealthy, and he won a victory with it. He also points out that while Congress is likely to reach a deal, and it will look largely Democratic, it may take longer than December 31st to do so.