What To Do With Your Stimulus Check

Just about everyone has felt the impact of the Coronavirus pandemic. Financially, it has caused difficulties for many people. Furlough, job loss, and a general slowing down of the economy have all contributed to financial stress and left many people looking for work because of Covid-19. If you are struggling financially, getting a stimulus check may be just the thing you need to help you get through the difficult times caused by the coronavirus pandemic. However, each situation is different which means that there is not a single answer to the question of, ‘What should I do with my stimulus check?’ Financial experts around the country have weighed in on this debate and have plenty of advice to offer people who are trying to decide how to allocate the stimulus money. Keep reading to learn what some of the top financial experts have to say about how to spend the latest stimulus check.

Use your stimulus check to cover necessities

Experts agree that the first thing you need to do with your stimulus check is to make sure your necessities or ‘four walls’ are covered. Debt payoff expert Dave Ramsey recommends using the stimulus money to ‘protect your four walls.’ The four walls he is referring to include food, utilities, shelter, and transportation. If you do not currently have enough money to cover these basics then you should use your stimulus check to make sure they are covered. Make sure you cover the basics before you make other financial decisions like paying off debt, saving, investing, or making big purchases. 


Use your stimulus check to build up savings

Acorns is an investing app that also provides financial education for free. Acorns interviewed experts and asked how people should be using the next stimulus check. The expert advice provided states that the best thing to do with the next stimulus check is to save. The article goes on to outline the fact that standard recommendations for emergency funds – three to six months – come up short as illustrated by the pandemic. A six month emergency fund would be long gone if you had to live off of it from the beginning of the pandemic. Even an eight month emergency fund would fall short. Because of this, Acorns recommends beefing up your emergency fund with the stimulus money – even if that means you have more money in savings than other experts recommend.  


Use your stimulus check to pay off debt

CNBC interviewed financial experts who weighed in on the debate about how to use stimulus check money. This article recommends that any American with credit card debt should use the stimulus money to pay that debt down. The high interest rates that often come with credit card debt can cost you hundreds or thousands of dollars a year in interest. You can take a look at the interest rates you are paying on credit cards and other types of loans and put your stimulus check toward the ones that have the highest interest. This will maximize the amount of savings you will see from paying off your debts. 

Before you take this step, make sure you have enough money coming in to cover your expenses going forward. It doesn’t make sense to pay off a credit card with your stimulus money then turn around and use the credit card next month because you are running short. The advice to pay off credit card debt should only be applied in situations where you can cover your current expenses. 

Use your stimulus check to make investments

Clark Howard is a financial expert who helps people get their spending under control and find the best deals on everyday purchases. Howard recommends triaging the money you get from the stimulus check. He recommends looking at the necessities that require money – food, housing, transportation, utilities – and applying the money to those areas as needed. If you have to choose between the must haves and paying unsecured debt on time, Clarks says to choose the must haves. 

Once you are sure that you have the basics covered, you can use your stimulus money to make an investment in your future. If you have a solid emergency fund and are still employed, consider investing the money for your future and get it working for you. You can fund a Roth IRA, put it in a non-retirement investment account, start a college fund for your child, or choose some other type of investment vehicle. 

Answer the most important questions about your financial situation

The YNAB (You Need a Budget) team recommends asking some important questions about your financial situation to help you decide what to do with your stimulus check. These questions include, ‘What does this money need to do right now? Does the money need to cover essentials like food and shelter? Does the money need to be used to stay up to date on loan payments? Can the money be used to extend your budget a little further into the future? Does the money need to be used to increase your emergency savings?’Ask these questions in order and only move on to the next if you are confident that the basics are covered. If you can meet your basic needs, cover your current bills, and plan for future expenses then you can use your stimulus money to increase your savings until the pandemic is over. 


As you can see, every financial expert takes a unique approach to deciding what to do with your stimulus check. The bottom line is, you need to focus on your needs first. Having food on the table, keeping a roof over your head, keeping the utilities on, and having reliable transportation are the top priorities. After the essentials are covered, you should use the money to help you make progress toward your financial goals. It is for you to decide whether your goals are to have more savings, invest more, or bless others with the money you receive from the stimulus check. 

Other Posts

student searching for free stuff online

The Best Free Stuff Students Can Get Online

December 9, 2021

College students may acquire a lot of free goods if they know where to search. We’ve compiled a list of discounts and freebies for college students that will save you a ton of money! If you like free stuff, check out our ultimate guide to the best free stuff anyone can get online. Free Amazon…

Read More

The Best Free Stuff For Active Military & Veterans

November 18, 2021

Military members sacrifice so much, yet they are among the lowest-paid in the nation. In exchange for subsidized housing and healthcare, military families are left with much less cash to use for other living necessities and luxuries. In acknowledgment of the great sacrifices that military personnel, families, and veterans make, many companies and organizations have…

Read More

How To Get The Best Free Stuff For Parents

November 4, 2021

Preparing for a new baby is an exciting time. You get to set up a new nursery in your home. You’re choosing baby names to call them. But the truth is that having and raising a baby gets expensive. Suddenly you’re looking everywhere for free stuff for parents. You’re always on the lookout for baby…

Read More