Catch up on bills or treat yourself? Plan now for how to use that stimulus payment

The second round of economic impact payments are in the process of being distributed across America. Here are a few tips to make sure you are putting that money to good use and getting the most bang for your buck.

Catch up on bills

Whether you have been sick, have had your hours cut, or have been out of a job altogether, falling behind on your bills is not something to be embarrassed about. This past year has been a struggle for most of us, and the whole purpose of the stimulus checks is to help us get back on our feet. Use this as a chance to get caught up on some bills that might have fallen behind due to the pandemic. Paying off this debt, or as much as you can, and getting back to a more normal payment schedule will be a huge weight off your shoulders and one less thing you have to worry about.

Pay off debt

Speaking of paying off debt, after making sure you are caught up on all your bills, take some time to look at any other debt you may owe. This stimulus may help you pay off some credit card debt, make a dent in your mortgage, or pay off your auto loan. If you are fortunate enough to have options with what to do with this money, take the opportunity to lessen your overall debt.

Save

If you are caught up on your bills and do not have a lot of debt that you are worrying about paying down, I would suggest putting this money into savings. This past year more than ever, we have seen the importance of having that emergency savings built up. Add this stimulus check into the savings that you already have built up, or contact your financial institution to see what types of savings accounts they offer. If possible, put it somewhere it can grow and earn interest.

Treat yourself

2020 was a long, hard, struggle of a year for all of us and if your situation allows, feel free to use this money to give yourself a well-deserved break. Reward yourself with a nice dinner, a cool date night, or that one thing from your favorite store that you have had your eye on but just could not bring yourself to buy. Remember to make time for yourself and do what makes you happy. That is more important now than ever.

When you receive your economic impact payment, take some time to really think about your situation and how you can use your stimulus check in a way that will be most beneficial to yourself, your mental health and your future.

Kat Hnatyshyn, when not blogging or caring for her little ones, is a manager with CommunityAmerica Credit Union. For more financial chatter, visit http://communityamerica.com

This story was originally published January 19, 2021 at 5:00 AM.