Smart Tips on how to Spend your Stimulus Money
Millions of people got their $1,200 coronavirus stimulus check this week. And if you’re still expecting yours, it should be coming soon. Here are five tips on how to be smart with it when it does come . . .
1. Take care of your immediate needs. This includes things like food, monthly bills, and your rent or mortgage. Once you’re set on those, use any leftover funds to pay down credit cards or other debt that’s charging you interest.
2. Pay your taxes. The deadline for filing your taxes has been pushed back to July 15th. And if you’ll owe, you could use the stimulus check to cover the payment and send the money right back to the government, as painful as that sounds.
3. Start or add to an emergency fund. A good rule of thumb for an emergency fund is enough to cover expenses for three to six months. And while $1,200 likely won’t cover that, it can be a decent starting point.
4. Open an investment account for your children. The stimulus package includes an additional $500 per child. And if you don’t need that money for necessities, consider starting a 529 investment plan for your kids, which can be used for their education.
5. Give to those in need. If you’re one of the lucky few who haven’t been impacted financially during the crisis, consider giving at least some of your check to people who haven’t been as fortunate. That could be anything from a food bank or hospital to friends and family members who’ve been hit hard by the pandemic.