top of page
  • James Veal

Top Three Things You Should Do With Your Stimulus Check?

The American Rescue Plan - a $1.9 trillion economic stimulus package passed by the government (Democrats to be exact) on March 11 - will provide Americans with another stimulus check. For those who meet the income requirements, the payout will be for $1,400 - to help ease the impact of the coronavirus pandemic.

While $1,400 can only go so far, every dollar does help. I'm going to chime in here and give you my advice on the top three ways to use it if you were my typical client:


If you've falling behind on high-priority bills such as your mortgage, rent and utilities, there is no question that you should take care of these issues right away. That's what it's for!

If you haven't already, it's also worth seeing if there's any way you can reduce your bills before you pay them. Many credit card issuers have been offering financial hardship assistance, such as flexible bill payments and waived late fees and interest. Your bank might be willing to put you on an adjusted payment plan if you ask.


A great idea would be to save your stimulus money and start building up your saving accounts.

If you don't already have three to six months' worth of expenses stashed away, this could be a good way to start. As you have witnessed in the news, millions of American citizens lost their jobs and most of them did not have adequate saving funds to keep up with their bills or to keep food on the table for their families.

For the millions who are unemployed due to the coronavirus pandemic and scrambling for income, having cash on hand is very important. So, if you think your income may be in jeopardy (you expect a layoff, being furloughed or reduced working hours), save the money from the stimulus check in a safe FDIC savings account.


If you have no debt and a good-size emergency fund in place, you are fortunate in these times. Since you are in a good financial position, we recommend that you invest the stimulus funds.

If you work with a financial advisor or you're a DIY, make an effort to spread the funds across several stocks or index funds. You can set up the account(s) and invest a certain portion on a monthly basis. This is called dollar-cost-averaging, and it means you won't have to guess about when the best time might be to buy or sell a stock. Although stocks will go up on some days and down on others, you'll be paying an average price over time. "This is the best strategy that typical investors should use to grow their portfolios," said the greatest investor of all time-Warren Buffett.


With another round of stimulus checks already in your hands or on its way, the best way to spend the extra cash depends on your situation. You can use it to pay the bills, build a savings cushion, pay off high-interest credit card debt, or to invest it.

And at the end of the day, don't be ashamed if you decide to use some of it to treat yourself. Times are tough and we're all human. If you can afford to, spend a little now on something that makes your life easier. There's nothing wrong with that.

bottom of page