5 Things You Should Do with Your Stimulus Check
The first set of Americans have received their economic impact payments, and more disbursements should arrive in the coming weeks. Before you run to the nearest electronics store for a $1,200 TV, take a moment to think about long-term goals. What is the best way to use your stimulus payment? How can this help you in the present and in the future? Here are some tips to help you make the most of your stimulus check.
Take Care of Your Immediate Needs
Think about your most immediate needs. If you’re out of work or getting reduced pay, make sure your most important bills are covered. Pay rent for a month or two. Pay your past-due electric bill so your electricity does not get cut off. Make a car payment to prevent your vehicle from being repossessed. Prioritize these matters before you consider other ways to use your stimulus check.
Save Your Stimulus Check for Future Needs
If you have no pressing needs now, save your economic impact payment. No one truly knows what the future has in store for the U.S. economy. A $1,200+ emergency fund could be a lifesaver later on. Wait to use the money when you need it most.
Pay off Debt, Particularly High-Interest Loans and Credit Cards
Do you have one loan or credit card that is costing you hundreds of dollars in interest? Eliminate high-interest debt to ease your burden in the future. Not only will this lower your monthly bills, but it will prevent you from paying even more in interest moving forward.
Open a Secured Credit Card to Improve Your Credit Score
If you have bad credit or limited credit, you could use your stimulus check to open a secured credit card, such as the Green Dot Primor Visa Gold Secured Credit Card. A secured card acts much like a traditional credit card. The only difference is that you are the one funding your line of credit. If you open a card with a $1,200 deposit, that will be your credit limit. Use the card like you would any credit card, and make monthly payments to reimburse the funds. The card provider will report your positive payment history, and it could help build your credit if you use the card responsibly. If you decide to cancel the card, the funds in the account will return to your method of deposit, minus any fees or unpaid balances you may have. Check out these secured credit cards to get started.
If You Are Going to Shop, Shop Local
We can’t stop you from spending your stimulus check, but if you are going to spend it, shop local. The Small Business Association has maxed out its lending capacity, to the tune of $350 billion in business loans. Over 1.6 million loans were approved as a result of quarantine restrictions from the COVID-19 outbreak. Businesses in your community now have nowhere to turn for emergency funds, which could be the difference between staying open or shutting down for good. Buy gift cards, order takeout from local restaurants, and find ways to help your favorite small businesses. They need your support more than ever before.