Everyone is wondering how to best spend their stimulus money after uncle Sam energized many American's bank accounts last week. The stimulus checks were received via direct deposit, and those who are expecting it through snail mail should receive their's within the next week. For those who have not received their funds, Smartasset.com utilizes a brilliant calculator to help you calculate your amount. The timing could not have been better due to the set back created by the Covid-19. The $2.2 trillion Coronavirus Aid, Relief and Economic Security Act (CARES) included $300 billion in the form of direct payments to American families and individuals. Everyone is encountering different financial dilemmas in their lives due to recent events with Covid-19, and are undoubtably debating how to allocate their funds. Here are 5 good ways to put that check to use:
- Put that money into a savings account, if your not as financially stricken from the current economic situation. Cash is King in uncertain times! As stated in the last post, Saving Money: Build the Emergency Fund, the average American has $8,863 in a readily available account. Strengthening the savings account would be a smart money-move with the uncharted economic conditions.
- Health Savings Accounts (HSA's) are becoming more common among Americans. Having means to take care of your health is always a positive investment, especially with the on-going pandemic which is creating a health crisis for many. If those funds are not used to care for yourself now they can be used at a later date. Putting your money into an HSA can also help with taxes. The HSA Contribution would be tax-deductible, and they can grow tax-free!
- Invest in yourself by furthering your knowledge or education. Look into books that will help you learn a new skill or expand your expertise in a given area. Learning how to do web design through books and online courses would be a great investment and create an opportunity for a side hustle. Through online web design platforms, such as WordPress, you can create websites for free.
- Americans are being affected differently during this pandemic and are in different financial situations. Some people do not have the luxury of investing the stimulus funds as mentioned in 1-3, but need to make ends meat. They may have to pick and choose which bills to pay and which to miss. I would prioritize paying my mortgage, due to the financial impact a foreclosure would have. Due to the varying levels of stability right now, individuals would have to evaluate every option before making a decision. Knowing the mortgage type and terms and if it is federally backed could be a make or break on the decision, as mortgage payment deferrals or forbearance could be an option to buy time.
- If housing was covered for the month I would look into paying off the next essential debt. Having a form of transportation could be crucial to some individuals. Once this crisis passes, having transportation to your current job or transportation to aid in a search for a new job could be necessary to move forward. This would require making these vehicle payments. Along the lines of making vehicle payments, for those that take public transportation, stashing the money away to aid in paying for public transportation is also an option if needed.