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After months of delays, it finally happened: Congress passed another spending bill with billions of dollars of COVID relief, which the President signed into law in December. While many types of aid are packed into that bill for individuals and companies, such as extended unemployment benefits and another round of the Paycheck Protection Plan (PPP), one of the direct benefits many Americans can expect to see soon (if you haven’t already) is a $600 stimulus payment, with another $500 per child. While $600 may not seem like much – and many had hoped the payment would be as large as $2,000 – you can still put that money to good use and maneuver into a stronger financial position as the pandemic continues. Here are some great ways to spend that second stimulus check.
Meet Your Pressing Needs
If, like millions of other Americans, you’ve been left unemployed or underemployed by the COVID-19 lockdown, then how you spend that second stimulus check shouldn’t be a difficult choice; buy the things you need with it. Go ahead and purchase groceries, or heating oil, or pay your electric bill. Fill your cars up with gas so you can get to wherever you need to go for the next several weeks. If you have any pressing requirements, put that check to work taking care of it immediately. Even though it probably isn’t as much as you need to feel secure, $600 can fill your fridge and keep your house heated for several weeks, which is definitely something.
Pay Down Debt
Chances are strong that you were already in debt before the pandemic hit, and it has only gotten worse since you began living under lockdown. Many are using credit cards to get by from month to month and to make up the difference between expenses and the decreased cash they’re bringing in each month. If you’ve only been able to make the minimum payments on your credit card, then consider putting that $600 toward your debts. While it probably isn’t going to pay off your balance, it can slow down the speed at which that balance is growing until you’re back on your feet.
Fix Your Car (or Something Else)
If you’ve barely been scraping by, you’ve probably been letting your automobile maintenance slip. After all, your newer car runs just fine, and getting a little more mileage out of that oil may not seem like a big deal. However, if you suddenly have to deal with a major mechanical problem that costs hundreds or thousands of dollars to repair, that’s probably going to be a major crisis for you. So, while you have an extra $600 to spend for once, consider getting some maintenance done on your vehicle. Routine maintenance, such as an oil change, is a great way to prevent serious engine problems later on. You may even want to consider getting your tires replaced if they’re worn down, too. If you feel your car is in good enough condition, then look around your home to see if anything needs maintenance or repair. Keeping your furnace, HVAC, or plumbing in good shape can save you a ton of money later.
Save for Emergencies
If you’ve had enough money throughout the pandemic to get by and don’t need the cash to address serious problems, consider saving that second stimulus check for emergencies. Replenishing your emergency fund is a great way to ensure you have peace of mind as the pandemic continues. For many, that $600 may be the start of the first emergency fund they’ve had, too, since almost half of all Americans have less than $1,000 in savings, even during good times. $600 can make a great start towards an emergency fund that can help later on, in case the lockdown drags on and unemployment or other relief runs out.
Invest Your Stimulus Check
If you’re one of the fortunate ones who’ve remained relatively secure financially throughout the pandemic, you can still put that second stimulus check to good use. Consider investing that $600 as soon as you can cash it. That check could go right into your IRA, 401(k) or some other type of retirement savings account to help you meet your annual retirement savings goal. You could also put that money into a college education savings account, such as a 529 plan, to start saving for your children’s education. Alternatively, you could just deposit the $600 in your brokerage account and invest in stocks or mutual funds. Regardless of how you invest, you’re able to put an extra $600 to work this year.
Don’t Let that Second Stimulus Check Go to Waste
There are many different ways to spend that $600 stimulus check when it arrives in the mail. The best way to spend it depends upon your personal financial situation. So, as you wait for that check to arrive over the next few weeks, think hard about what your priorities are. If you put a little bit of thought into it, you’ll be able to put that money to good use as soon as you deposit it.
