Staying Financially Savvy with your Stimulus
Millions of Americans will soon be receiving $1400 checks as part of the third-round of stimulus payments. This pandemic has hit many families extremely hard, and put many in difficult financial situations. How you intend to use your check depends on your situation. Many people need this stimulus for necessities like rent, bills, food, and other things. But if you’re part of the lucky group that is still fully employed during these difficult times, you might be considering other ways to use your stimulus. This new income has the potential to make a big impact on your life depending on how you choose to use it. Here are a few ways to put this check to good use:
Spend it on the Basic Necessities
Now is the chance to give your regular checking account a break. Use your stimulus check to address your most urgent payments and pay off the basics like rent, bills, or groceries. If you’re worried about paying your day-to-day expenses, using this income to cover them is the obvious choice. It’s what the check is intended for in the first place.
Set it and forget it. Consider putting your stimulus check into a savings account and saving it for future endeavors or major purchases. It is recommended that you have enough in your savings to cover three to six months of expenses. If you’re not near that goal currently, it is a good time to start working towards that. It may be tempting to immediately spend this new income, but you will be thankful in the future to have the money available.
Add to Your Emergency Savings
If this past year has taught us anything, it's that you should always be prepared for the unexpected. If you don’t have an emergency savings fund, now is a great time to start one! Think about putting either your full check, or even just a part of it aside for a rainy day. If you already have an emergency fund, add a little (or a lot) to it. You never know when or for what you will need to tap into this account.
Pay Off your Debts
Debt happens! If you are currently paying off high-interest debt, such as credit card debt, this is a great opportunity to try and pay that off. Not only is this freeing up funds by paying off your short term bills, you are also saving in the long-term by avoiding continuing to pay interest.
If you have ever considered investing but have never taken the leap, take this stimulus check as a sign to start. Even if it is just a small amount, this is a great opportunity to learn more about purchasing stocks. Not only is this a great learning experience, but it gives you the chance to potentially turn this money into even more money in the future.
Another vital lesson we have learned this year is the importance of local businesses. Our local business owners are our friends and neighbors, and their businesses make where you live unique and prosperous. When you spend your money locally, that money goes right back into your community. If you’re thinking of using your stimulus check to treat yourself to something special, consider doing it locally. Whether its a local boutique, florist, apothecary, bakery, or grocery store, spending your money locally reduces environmental impact, supports local infrastructure, and creates more local jobs.
Donate It to a Local Charity
If you are lucky enough to still be in a stable situation, consider helping others that are not. Now more than ever, local charities and nonprofits are relying on their supporters and community members to be able to continue their missions. Consider giving away some or all of your check to charities like food banks, medical services, relief supplies, or housing assistance programs. Our local communities are stronger when we lift each other up and lend a hand to those who need it.
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