By now, hopefully, most individuals who qualified for one have received their stimulus checks. Those can be a welcome sight for many who have recently lost their jobs, suffered pay cuts, or had to close down their businesses.
People have varying opinions on the financial help we are receiving. Some see $1,200 as pennies, and fear that the government will just have to send out similar checks again in a matter of months (or weeks!) Some may bring up the fact that other countries are still paying everyone the majority of their salaries through government programs. But, for some, $1,200 could mean the difference between feeding their family for a few months and…not. For some, it may have helped with some more advanced financial needs. No matter where you stand right now, there are smart and good things you can do with your stimulus check.
Buy essential supplies
If your financial situation is dire, make sure you are stocked up on the essentials like food, sanitary items, and feminine products. Don’t spend a penny on anything else until you know your stomach and those of your family members will be filled for the coming months so you can, from there, work on higher financial goals. You can’t successfully look for work if you’re worried about not having enough food.
If you’re in a financial situation that allows you to temporarily part ways with your check in order to grow it in the long term, this can be a good time to buy stock. That may seem counterintuitive because of the state of the economy, but that’s exactly why stock is currently cheap. You can buy low, and see your money grow fast when things reopen.
Advertise your online business
If you own a business and are currently able to run your business online, invest in your business and use that check—or part of it—to run an ad for your business. You could start small, see how that ad does, and see if it’s worth investing in more advertisement. If a $400 ad brings in $3,000 in business, that’s money well spent.
Learn a marketable skill
Maybe you’re coming to the realization that the industry you worked in before the Coronavirus pandemic may take a big hit for a long time, and you’re usual income may not be restored from that line of work for too many months. Perhaps you can use your check to take an online class that will teach you a marketable skill you can use to make money in this “new world.” Accounting? Translating?
Get a device or software to help you work
If there is software or a device that could help you make money, buy it. Maybe that’s Photoshop or some other editing software. Maybe it’s a new laptop with more capabilities. Maybe it’s an accounting software. These are investments if you know you can use them to make an income.
Start a trust fund for your child
If you have children and this pandemic has had you thinking about how turbulent the world might be for them and how you’d like to protect them and set them up financially, you could open a trust fund for them. If they are young, $1,200 can grow a lot by the time they’re adults. And you can contribute a bit more each year. It may be better than starting a Go Fund Me once college comes around, as some parents do.
Buy emergency supplies
In all likelihood, this current pandemic will not affect our access to water or electricity. But it may have you thinking about how you’d like to be prepared for future problems that could affect water and power. Maybe this is a good time to buy a free-standing water filter, a battery-powered hot plate, some quality flashlights, batteries, and things like that.
Help someone who really needs it
If you really weren’t worried about money when that check came in because you’ve been a good saver and/or your job is secure, perhaps you can do something good with your money. Maybe you know of a neighbor struggling to afford food. Help them out. Or you could donate to some of the many organizations doing great things during this pandemic.
Fix your car
If you need your car to make money now, know you will need it when the economy reopens, or would like the option to leave where you currently are—should things in your area become dire—to stay with family in another town, then get your car fixed now. If you wait until the economy reopens, the wait to see a mechanic may be too long.
Open a savings account
If you don’t have a savings account and don’t need to keep your $1,200 liquid, open a savings account. The cool thing about that option is that many banks are offering bonuses to new account holders, like free cash or an excellent introductory rate–better than the usual rather weak ones.
Make a (very) small business loan
If you have an entrepreneurial spirit, have more than enough cash liquid for your immediate needs, and know of a small business that could make good use of that $1,200, maybe you can invest there and help that business out. Perhaps a small business owner you know needs $1,200 to fix his equipment or buy new equipment. You could lend him or her your cash at a reasonable rate, help that business get back up and running, and make a return on your investment.
Negotiate with a lender
If interest rates with a lender have been bleeding you dry, and you have enough cash coming in to pay for immediate needs, you could buy down your rate. Some lenders, like mortgage or car lenders, will accept a one-time cash payment that lowers your rate. So, say you’re paying seven percent on a car loan. Maybe you can negotiate with the lender, give them $1,000 now and have them drop your rate to 5.5 percent. If you have a long loan and a large principal, those long-term savings could equate to way more than $1,000 in the end.
Get an additional freezer
If there is one thing we’ve all learned from this pandemic it’s that the need to go to the grocery store really messes up our greater need to quarantine. Maybe, if you have the space, this is a good time to invest in a large freezer, where you can store a month’s worth of food. Pandemic or no pandemic, that’ll cut down grocery runs.
Pay some of your rent
If your landlord is not providing much relief, you may want to use some of your stimulus check to pay at least part of your rent. It’s better to pay some now then to have several months of missing payments rack up, that you’ll need to pay later.
Open a Roth-IRA
If you didn’t already have one, you could open a Roth IRA. If you are in your thirties or younger, that account has a lot of time to grow before your retirement. In future years, you’ll want to put in more than $1,200 a year but this is a good start.