Smart Ways to Spend Your Stimulus Check
March 18, 2021
If you are in a solid financial place, you may be wondering “what are some smart ways to use my stimulus money?” Here are several ideas to make the most of your stimulus check.
1. Pay your bills.
Reducing your credit card balances or bringing delinquent accounts current is the first smart way to use your stimulus funds. So start there, if needed.
2. Establish an emergency fund.
If you don’t have an emergency fund, start one today. Saving at least three to six months of living expenses in a savings account can help you cover unexpected costs, such as car repairs or medical bills. Having this fund can also help you from going further into debt, as you won’t have to rely on credit cards to pay for unplanned costs.
3. Add to your retirement.
Keep in mind that because the stimulus payment is not taxed, opening a Roth IRA makes it triple tax-free: you did not pay taxes on the funds, they will grow tax-free, and you won’t pay taxes when you withdraw the money.
4. Do some maintenance.
Taking care of your investments is important, whether it is a car, a home, or both. If you now have the means, take your car in for routine maintenance, and consider home repairs, or making any updates you may have been putting off.
5. Help others.
Making a donation to one or more of your favorite charities is great way to help others, and the local economy. With the pandemic, there are more people than ever in need. Contributing part of your stimulus funds to a local food pantry, or another organization that helps those most in need, is a great way to help.
There are many ways to spend your stimulus check. Using the funds to shore up your own financial position, and supporting those in your community who could use extra help are great places to start.
Tags: Money Management, Savings, Community