Updated: January 12, 2021
The pandemic has caused many Americans to lose their jobs and the financial stability to provide for their families. This is a harsh reality, and last year’s stimulus check alleviated the strain, but not for long. Those without a financial safety net are scrambling to keep themselves afloat. The government has intervened and allocated more funds for the second round of stimulus checks that may help your financial burden.
What will you do with your stimulus check? Take these ideas into consideration.
Rent and Bills
At a time when there is so much uncertainty, the core necessities are what matter the most. With restrictions on leaving your home in place for the entire country, using your stimulus check to keep a roof over your head is a good strategy.
This is especially crucial when renting or leasing a home. Speak with your landlord about delayed or partial payments if you need more relief in these trying times.
Save Emergency Funds
If you do not have a nest egg for emergencies now is a great time to start. Any amount of rainy day funds can make a difference. When the unexpected occurs it is a relief to know that you have a cushion of savings and won’t need to rely on credit to stay afloat. This is a wise way to use your stimulus check.
There are a few reasons why saving money at this time is necessary. Your job security may be in question or you may be working fewer hours than before. Perhaps the same has happened to your partner or roommate. In any case, an emergency fund would greatly reduce your anxiety and provide support when you need it most.
Paying Off Debt
Debt can be overwhelming when your financial stability is uncertain. About 110 million Americans carried credit card debt into the coronavirus quarantine. Many are unsure about how or when they will afford their next payment and the basic necessities.
A 2016 Federal Reserve report found that 43% of families who spent more money than they earned each month relied on credit cards to stay afloat. This creates a compounding debt problem that quickly becomes insurmountable. If you already rely on credit cards to cover the basic necessities, debt payment may not be the best use of your stimulus check.
If you would like to pay off high-interest credit card debt during this crisis, we recommend a debt consolidation loan. You’ll pay off the same debt at a lower interest rate, which will lower your monthly payments and allow you to put a bigger dent in your principal. This is a more sustainable long-term solution than a single large payment.
Lendah can find a debt consolidation loan that fits your needs. The process is easy and simple with just one application. We offer fast approvals, often within a day!
Our loan matchmakers will find the best terms tailored to your situation with rates starting as low as 3.84% and approval for up to $100,000 from more than 30 lenders. Best of all, you won’t be penalized for paying off your loans early!