Ideas for What to Do with Stimulus Money
For the millions of Americans that have lost their jobs and are now applying for unemployment, deciding where to spend the stimulus check is easy. However, how should someone use their stimulus check if they’re still working? Here are a few ideas on what to do with your stimulus money.
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Pay for Essentials
Of course, the stimulus package sent out is meant to pay for essentials required for basic living. Essentials include necessities like rent, food, medications, utilities, car insurance, and medical insurance. If you are caught up on bills, consider setting aside the money for future months.
Build an Emergency Fund
If you have little to no savings and won’t have an issue paying your bills this month, it’s time to build your emergency fund. Your emergency fund should be a savings account that is available to you if you are suddenly in need of a lot of cash. Situations where this can occur include losing your job, getting hospitalized, or having to pay for a major car repair. Unsure if you have enough in your emergency fund? Many experts recommend that your emergency fund should be large enough to cover at least six months of living, assuming you have no income during that time.
Reduce your Debt
For those that are in debt, reducing your debt is a great strategy for many taxpayers. However, you should decide which debts to tackle first. It’s easier to get rid of smaller debts first then focus on the big ones later. For example, consider paying off any credit card debt before looking into putting the money towards larger loans. Also, check to see if lenders are freezing payments and stopping interest accrual like the government is doing with federal student loans. If you are financially able, and your emergency fund is looking strong, focus on paying off the loans that aren’t offering as much relief.
We hope that you remain safe and healthy during this unpredictable time. For more financial tips like this, follow the US Auto Sales blog.