Did you get a stimulus check?
Many American citizens are about to or have already gotten, a stimulus check from the government. I am one of the lucky ones who has already received it in my bank account! Very exciting and very needed at this point. I am lucky enough to still have a job. However, since I get paid by the hour my paycheck is way down. With kids at home, not much work is getting done. I am also concerned about the security of my job since I work in a real-estate adjacent field. I can’t imagine that it won’t be affected (here are some steps to take if you are nervous about your job). What that will mean I don’t know.
Here is how I am going to use my “check”:
We got the deposit and immediately transferred it into my Barclays Savings account. That is where I keep my large emergency fund. We have been working for a while to save up between 3-6 months of expenses. We are not there yet. I have never had the balance been as large as it is today!
Figuring out our new budget
This part is pretty difficult as there is a lot of guesswork. Food expenses are up and transportation is way down but we are sort of guessing as to how much we are spending on these categories. We have lower childcare costs, which is great, and lower random spending. The fewer times we go to the store, the less we end up buying random stuff that we “need”. Going to the store less often has been good for my budget.
This is a good time to see what you can cut from your budget
Any recurring expenses you can cut? Any subscriptions?
Call your auto insurance and see if they will give you a lower rate based on lower driving time (if this applies to you).
Call your internet and phone providers and see if they will give you a new deal. Sometimes it’s worth just calling and you might save some money!
Cancel credit cards with annual fees. This may cause a temporary drop in your credit score but that won’t affect you much unless you are actively seeking to get more debt (ex a mortgage or a loan), this is a good time to rethink some travel credit cards. I am not imagining travel anytime soon. You can usually apply for credit cards again if you decide to resign up for those cards.
If money is tight, then now is a great time to cut down on takeout and other discretionary expenses. It’s much easier to save money on clothing, shoes, home goods, etc. when you are not going out to shop. Now is the time to cut as much as you can. You can always spend more later.
Stimulating the economy
There are definitely points to be made about using the stimulus money to, you know, actually stimulate the economy. If you have a job and have a HEFTY amount of money in savings then you should use your money to help support small businesses. However, if you are not in that position then you should take care of yourself first. We don’t know how long this will last so it is important that you are prepared for the long haul.
That being said, I am giving maaser (tithing) from the check. I don’t know if I “have to” according to Jewish law but we have decided to do so regardless. We are giving 10% to various local charities. One, in particular, is giving cash assistance to struggling families. I think that in these trying times we have to do all we can to help those who are less fortunate than us. We can so easily be in their position. Since we were blessed to be in a better position than that means that we must help.
Calculating our “new” income
I am doing my best to calculate how much money I might make this month. This means evaluating how many hours of work I can probably work without going crazy. Since we have this money available to us, I don’t think I should sacrifice my health to work extra hours that are not needed. I can basically only work at night after the kids are sleeping, there are not so many hours available to work. Working until the early hours of the morning and then dealing and homeschooling the kids is not a good idea. Luckily, I can make up the shortfall with this money and with our lowered expenses.
Each month, I am planning on taking the stimulus money out of our emergency fund to cover the shortfall and gap between our income and expenses. I don’t want to keep all the money in my checking account or I might be tempted to spend it. I firmly believe that we spend the money we have. That is why I usually love spending cash rather than a credit card and why I live on a strict budget.
Obviously, now I have switched to using a card. Whoever, the money that is available to us is the money we spend. That is why I don’t keep the money I don’t want to spend in my checking account. Out of sight is out of mind.
By keeping the stimulus money in the emergency fund it ensures that I will only spend what I need. When all this is over (hopefully soon!) then the money will already be in my emergency fund. If I don’t need it all then that means my emergency fund will get a much-needed boost. If I do need it this way will hopefully allow it to stretch a bit longer and reduce any extra spending.
so… my stimulus check:
- 10% to charity
- Cover loss on income
- emergency fund
What are you doing with your stimulus check?