Money doesn’t fall from the sky, but in the stimulus bill that just became law, we’re going to see something similar in the form of stimulus checks.
How much will I get in my stimulus check?
Most Americans can expect a check for $1200—or $2400 if you’re married filing jointly on your taxes. Plus, add $500 per kid if you have a family. Bazinga!
If you make more than $75,000 (or $150,000 as a couple), you’ll see smaller amounts (eventually phasing out at high income levels). Use this calculator to find out how much you’ll get.
How do I get it?
Most checks will be direct-deposited automatically based on information from your 2019 (or 2018) tax return.
When will I get it?
Treasury Secretary Steven Mnuchin said he expected most people to get their payments within three weeks. Don’t pencil that date in quite yet though—some experts say it may take longer. Prepare your heart: read more about timing.
Why are they sending checks?
Ok, I doubt anyone is actually questioning “free” money, but let’s give some background anyway. Since we’ve all been binge-reading the news (but trying not to), it will surprise no one that our economy just took a nosedive. It’s not unlike a roller coaster that just tipped over a big hill—and our stomachs followed and now feel like they’re full of moths, sand, and a turf grass smoothie. The stimulus checks are just one piece of a much larger plan to coax the economy back to its previous state of thriving.
So what should I do with it?
Many of you already know what this money needs to do (Pay rent! Pay the mortgage! Buy food!). Or maybe some things you want it to do (Stream Contagion! Buy floret flower seeds! Pay whatever fee is required to keep the kids entertained for just two more hours!).
As you’re deciding what to do with this windfall, we have a little framework to help guide your way.
1. Don’t “Use” the Money Before You Get It
Yes, it’s downright tempting to justify the impulse spending now because you know you’re getting this check soon. But, you don’t have the money yet. You don’t know when it will arrive. Save yourself the stress of anticipation by only giving those dollars jobs when they hit your bank account.
2. Ask: What Does This Money Need to Do Right Now?
It might be glaringly obvious what this money needs to do right now. Maybe you need food, so you rush out and get food the minute the check lands. You throw things in your cart. Where’s the bread?! One loaf left and it’s rye! You don’t even like rye! Who cares—into the cart it goes! But step back and look at the pace and the unsettled chaos of this approach.
When you’re asking this question of “what does my money need to do right now,” does it sound like the sped-up, high-pitched voice of Alvin the chipmunk or the calm, steady pitch of Morgan Freeman?
Sure, everything feels chaotic right now (Waffle House—you were our strong and steady!), but you don’t need to operate in a state of chaos or urgency. Just take a few minutes, find some calm, and gut check (and budget check) what you need this money to do right now.
- Are your essentials covered (food, shelter, utilities)?
- Are your loan payments covered (private student loans, car loans, credit card payments)?
- If you’re in a state of hardship, have you called your providers to reduce these costs?
- Could you budget for essentials further out in the future?
- Could you fatten your cushion (emergency fund, future car repair, future pet expense)?
Look at this list through the lens of your budget and everything is crystal-clear in terms of priority and timing. Armed with the full picture, maybe you spend $50 less on groceries this week because you know you need to make the rent payment in five days.
3. Ask: What Will Boost My Financial Immune System the Most?
If you’re broke (or close to it):
We realize those reading this are in every financial situation possible: you might have a razor-thin cushion and this money will put food on the table. This money will keep the lights on. You’re just trying to keep your head above water and you know exactly what will help your situation the most. Budget for those essentials like food, housing, and utilities first and foremost.
Read: 6 Steps to Make Your Money Go Further
If you’ve got a bit of a cushion:
For those with a bit more of a cushion but you still feel a little financially shaky, the decision isn’t quite as clear cut. Sometimes, your best move may be to save that money rather than spend it. Build up your true expenses, fatten your emergency fund, or save for the car repair that you don’t see coming yet.
You may be thinking, “Well, it’s better for the economy if I spend this money.” Consider this: an economically healthy country is made up of economically healthy citizens. And when you strengthen your own financial health, you lessen your risk to the whole. Sure, you might spend your stimulus check in a month, in six months—but bringing yourself to a financially stable place helps everyone.
If you have solid financial footings:
You’ve set up your finances to weather a storm (though you weren’t planning on a storm like this). We tip our hats to you, but we all know there’s no victory dance to be had here with so many hurting. It’s tempting right now to shelter in the well-built security of your strong financial health—but maybe what’s best for your financial immune system is to look outward instead of turning inward. How can your strong position help someone in a weak position?
Donate your stimulus money to an organization that’s helping, pay for someone else’s groceries, or earmark a set amount for random acts of giving.
Sometimes, an extra dose of generosity is the superfood you didn’t know existed.
4. Give Every Dollar a Job
Once the money hits your bank account and you’ve thought through these questions (all nice and calm-like), give every dollar a job. You might have a lot of jobs to dole out—a family of four could be looking at $3400 in stimulus money! Maybe you earmark $300 for that future car repair, or you budget your mortgage payment for the next two months.
Covered your essentials and you just want to order Chinese take-out tonight? Yep, that’s a worthy cause too—send $60 to your “eating out” category. That’s the beauty of a budget: responsible saving and guilt-free spending.
5. Use Your Budget to Calm the Chaos
The budget can calm you when things feel chaotic—and there’s plenty of that going around. Sure, there’s a lot of uncertainty right now, but now you’ve got the facts laid out in front of you with your budget. Use this shot of stimulus money to tend to your immediate needs and bolster your financial health for the near future. Deep breath, it’s gonna be OK.
The post How to Spend Your Stimulus Check appeared first on You Need A Budget.
Via Finance http://www.rssmix.com/
No comments:
Post a Comment