Stimulus Checks: Here’s 12 Ways to Spend It
On March 27, 2020, President Trump signed a $2 Trillion dollar economic relief plan that is meant to help keep people involved in the economy. The plan included direct cash payments for many including changes to unemployment benefits and new rules for filing your taxes and making retirement contributions among other things. However, this article focuses solely on 12 ways to spend your coronavirus stimulus check which will come in a one-time cash payment from the IRS.
Individuals earning less than $75,000 can expect $1,200 and Married couples earning less than $150,000 can expect $2,400. Families will then add $500 per qualified child.
Here’s 12 Ways to Spend your Coronavirus Stimulus Check:
- Get caught up on any past due bills. If you are behind on any bills, be sure to bring them current. Do this first before anything else.
- Make sure you can cover any current bills due. Based on your last month’s bills and expectant income, consider what bills are coming up soon and if you’re able to cover them, if not – a good use of your stimulus check will be to cover current or upcoming bills.
- Start or add more money to your emergency fund. It is recommended to have a minimum of 3 months of living expenses saved. Living expenses include your necessities like housing, food, utilities, transportation, and debt payments. If you already have 3 months saved then work towards having 6 months of expenses saved. Having 6 months of income saved will come in handy in tough times like a recession when its harder to find employment or unexpected loss of employment.
- Pay off any high interest debts especially credit cards, personal loans, etc. It’s always good to have minimum debt especially high interest debt.
- Pay down student loans but with a twist. Under the bill, federally backed student loan payments and interest are waived until September 30, 2020 – so that’s 6 full months without required student loan payments or interest accruing. I would recommend saving the money that you would pay on your student loans (regular and extra payments) in an earmarked savings account and then making a large snowball payment before September 30th. I prefer this method because then you will have the cash available to you in case of an unexpected emergency during this pandemic or in case any other relief becomes available to student loan borrowers. However, if you don’t feel like you can save the money without spending it then make those payments because you will be directly paying down your student loan principal. Click here to read more on the changes to student loans during this time.
- Invest in your future. This is a great opportunity to invest more in your retirement accounts and if you don’t have one then you can start an Individual Retirement Account or Roth Individual Retirement Account. If you choose to invest in the stock market then you can earmark some money for your brokerage account to invest in stocks or funds.
- Invest in your child(ren). This is an ideal time to start your child’s college savings account or add to it. Every state offers a 529 College Savings Plan. If you don’t want to invest in a 529 College Savings Plan then you can still save money for their future in a savings account for them. Please don’t find yourself getting so hung on what to do for your child’s future and end up doing nothing. Learn more about a 529 Account by clicking here.
- Invest in your personal development. There are numerous ways to invest in your personal development ranging from low cost ways to expensive investments. Consider buying a book that you’ve been wanting to read and then implement what you read, purchasing an online course and do the work that the course outlines, buy yourself a ticket to attend a conference or event, start a business or maybe even invest in a 1:1 coaching session with someone you’ve been wanting to work with.
“Investing in yourself is the best investment you will ever make. It will not only improve your life, it will improve the lives of all those around you.” ―Robin Sharma
- Cover any items needing maintenance. If you’ve been putting off getting items serviced or maintained then this could be a good time to get it done before it becomes a major problem and expense down the road. Have you recently put off any car maintenance or any home maintenance then maybe use your stimulus check to cover that service.
- Donate to a charity. There are so many people that are in need right now due to COVID-19, this would be a good time to donate to a charity. All donations are typically welcomed so it doesn’t have to a large donation. Consider places like your local food bank, Red Cross, Feeding America or any other charity of your choice.
- Support a small business. There are a lot of small businesses that are currently struggling so this is a great time to support them by purchasing something from them. Other ways to support them is sharing their products and services on social media, following them on social media and recommending them to others.
- Treat yourself. Last but not least, once all of your necessities and priorities are covered then there’s nothing wrong with treating yourself. A few things to consider: A nice cup of coffee or tea from your favorite café, your favorite dessert from your favorite bakery, purchasing something for yourself from your favorite boutique or online store. It doesn’t have to be anything expensive but hopefully something that brings you a little joy during this pandemic.
If you don’t make a spending plan for your money, you will wonder where it went.
Remember to Stay Safe and we are in this together! Please comment below and let me know, How do you plan to spend your Stimulus Check.