By now most of us have gotten our stimulus checks or are waiting on it to arrive. You either know how much your family is getting or have calculated how much you will be getting. And if you have kids, they are also getting a stimulus check. My husband asked our daughter how she is planning to spend her $500 and she said toys at Target, haha. The stimulus check sent to Americans is supposed to do just that, stimulate the economy. Restaurant take-out sales boomed the day most people received their checks. For some who are out of work with no end in sight, the stimulus check is much-needed help to pay their basic expenses. My family is very fortunate to not have a change in our finances, my husband is an essential worker and has to continue going to work at the hospital and I am lucky enough to work for IGG Software that was already a virtual company prior to the pandemic. Although the stimulus check is supposed to stimulate the economy, once it is in your bank account, you can do whatever you want with it. You will need to consider your current financial situation to decide what the best option is for your family. Here are some ideas that you can do with your stimulus check.
Cover your bills
This should be your first priority. Are your expenses covered for the month? Keep in mind that electricity and water expenses may increase since everyone is at home, washing their hands a lot, and plugged into all the electronics.
Depending on who handles your car insurance, they may have sent out a communication saying they will be discounting monthly bills since everyone is driving less. My family has AAA and I received an email saying our bill would be discounted by 20%. If you have not received communication from your car insurance company, you might consider calling them and ask for a discount due to your not driving as much. It is also a good idea to ask about a garage discount for one of your vehicles if you have multiple. You can get a significant discount by “garaging” one car and only using the other car for the rare times you do need to drive.
Your food bill is definitely increasing with everyone being at home. You may want to use your stimulus check to stock up on groceries, particularly dry goods and things that can be frozen to keep your family fed for a while. Depending on where you live, many school districts are handing out free food to school aged children, remember to take advantage of this to stretch your food budget.
Many lenders and landlords are being flexible during this time if you cannot pay your mortgage or rent. Make sure to speak to them as soon as possible if you think you won’t be able to pay the full amount and use the stimulus check to make a payment. Bear in mind that landlords still need to make mortgage payments and keep the utilities on.
Increase your emergency fund
If your expenses are covered for the next month, consider putting the stimulus check into your emergency fund account. Nobody knows how long this pandemic will last and although you may be in a good financial position now, things can change very quickly so make sure you are prepared. Experts say to have 6 months of expenses in your emergency savings account so you are ready for any unplanned expenses or situations. Padding your emergency fund is always a good idea.
Pay off Debt
Have these last couple of weeks caused you to reach for the credit card and charge some needed things? Now is a good time to use your stimulus check to pay off the balance on your high-interest credit card. It may seem like you should save it instead of paying off debt right now but high-interest credit cards can just spiral you into more long term debt if you are only paying the minimum.
Do you have student loan debt? It may not make as much sense to pay this off with your stimulus check. Most student loan lenders are allowing people to put their payments on hold and are not currently collecting interest for the next 6 months. Call your student loan lender and ask what they can do for your situation.
This is an incredibly hard time for a lot of people. Many are out of work with no return to employment in sight. The stimulus check they received may not cover their expenses for even a month. Many food banks and charities are operating with the same amount of money, but a ton more need from their communities. If you are in a good financial position, you may want to help those that are less fortunate than you.
I’ve read during tragedies, look for the helpers, there will always be helpers. Our local community has been incredible. I have seen so many local companies donating food and groceries to those in need. I’ve read stories of people donating pet food or paying for a stranger’s groceries in the store. If you choose to donate some of your stimulus check, find something or an organization that is important to you and believe in supporting. It’s a scary time for everyone and it’s a perfect time to help if you can.
We love hearing from you. Please share how you are spending your stimulus check.
From all of us at IGG Software, be safe and be well!