We are living in unprecedented times.
- A global pandemic literally shut down the world.
- 1 in 5 Americans knows someone who has passed away from the Coronavirus. (((hugs)))
- 2 million women stopped working to care for dependents leading to a 30% unemployment rate for women by the end of 2020.
- 10 million jobs have been eliminated in the past year.
- Millions of families converted their homes to work-from-home offices.
- Millions of children had to adjust to learning via Zoom.
It’s only been 1 year since this microscopic virus turned our lives upside down.
Now Congress has passed and President Biden signed the $2 trillion American Rescue Plan Act. This bill directly impacts 85% of American households.
That includes you if:
- You are single and make less than $75,000 (benefits phase out above $80,000) annually
- You are married and earn less than $150,000 (benefits phase out above $160,000) annually
- You have children under the age of 17
- You claim adult dependents age 17 & up
- You are unemployed and receiving unemployment benefits
- You receive healthcare insurance through the ACA or COBRA
- You require emergency rental assistance or mortgage aid
The American Rescue Plan will touch a lot of families.
Child Tax Credit
Most of us are aware that benefits include $1400 payments per person to households that earn below the income limits. That’s helpful.
However, this 3rd stimulus package differs in that it extends the child tax credit to $3000 per child ($3600 for children 5 and under) and disperses half of the total in regular payments starting in July.
For example, a family claiming 3 dependent children under the age of 17 could expect to receive payments of $750 per month from July to December. The balance of that credit can be claimed on your next tax return.
The disbursement process has not been officially set yet. We don’t exactly know if the checks will be monthly. But, they are set to begin dropping in July.
Which begs this question…
What’s Your Plan?
Of course, if you are not working, your plan for the stimulus benefits should be to cover necessities.
Use the help that’s coming. Some reports suggest payments may be deposited this weekend.
If those 4 areas are not a concern, then let’s consider how to make this stimulus work best for you.
Start by answering the following questions:
- What are your financial goals?
- What are your financial priorities?
- What is on your financial wishlist?
- How much do you have in your emergency savings account?
- How much debt do you have?
10 Great Ways to Use Your Stimulus Benefit
- Blow it on a trip to Bermuda!!!
I kid. Let’s start again.
- Save at least $1000 in starter emergency fund.
- Pay off your smallest bill completely! (It will feel amazing to experience a quick win – trust me)
- Pay more than the minimum on the smallest debt you have if you’re not able to pay it off entirely.
- Establish a settlement agreement with a creditor and pay off an old, outstanding debt to clear up your credit report.
- Catch up on any bill that you’ve fallen behind on recently.
- Start a savings account with $50 – $100 in for each of your children.
- Open an investment account with $25 for each person in your household and purchase stock in a company that you know, purchase their products/services, and love.
- Save more than $1000 if you don’t have any pressing needs.
- Bless someone or something in need with a monetary gift.
- Budget in a feel-good purchase or pamper yourself. This has been a looooooong year!
Invest in you. Can you use this money (or a portion) in some way that will grow your area of expertise? Your income? Your income-producing power? Is there a class, a book, a seminar that can help you grow beyond this one-time stimulus benefit? I love how this young lady spent a $3400 tax refund in a way that led to a $12,000/month side-hustle.
Just brainstorming ideas.
How do you plan to use your stimulus relief benefits? Let me know in the comments below.