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3 Reasons Americans May Not Get a Second Round of Stimulus Checks

By Maurie Backman – Jun 13, 2020 at 6:18AM

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Though some lawmakers are pushing for additional relief, here's why it may not happen in the end.

Tens of millions of Americans have lost their jobs as the COVID-19 pandemic has spread across the country, and countless small businesses continue to struggle. And while a modicum of relief has come to many of them already in the form of government stimulus checks, cash-strapped Americans are already desperate for more financial help, especially now that the country is officially in the throes of a deep recession.

But will more stimulus checks actually arrive? The HEROES Act, which has passed the House of Representatives and is stalled in the Senate, calls for payouts to Americans that are actually more generous than the first ones. But here are three reasons why you shouldn't get your hopes up.

Pile of hundred-dollar bills

Image source: Getty Images.

1. May's unemployment numbers came in lower than April's

In April, the jobless rate reached a record high of 14.7% -- the highest unemployment level on record since the Great Depression. Economic forecasters were convinced May's numbers would be even uglier, but surprisingly, the official jobless rate dropped in May to 13.3%. And while further review of that data indicates that unemployment claims were actually underreported by as much as 3%, the May report could still provide fuel for the argument that American workers don't need a second round of financial assistance.

2. The economy is starting to open back up

Although numerous areas of the country are now seeing fresh spikes in COVID-19 cases, U.S. states are, by and large, gradually allowing people and businesses to resume the activities that were halted by the initial stay-at-home orders. Even hard-hit states like New York and New Jersey are easing their restrictions on what were deemed non-essential businesses. As such, those politicians who are against a second stimulus package may argue that approving one now is premature, and that the better choice would be to wait and see if the U.S. economy revives quickly enough without one.

3. Republican lawmakers strongly oppose the HEROES Act 

From the moment Democratic lawmakers introduced the HEROES Act, Republicans have pushed back against it, calling it too expensive; GOP senators have even gone so far as to describe it as dead on arrival in their chamber of Congress. As such, it's unlikely to even be given a Senate vote, at least in its current form. While another relief package may eventually get approved by the Senate, it's too soon to tell whether it will include direct stimulus payments to ordinary American, and far too soon to guess what that stimulus might amount to.

Right now, the HEROES Act calls for $1,200 stimulus payments to every qualifying adult, similar to the payments that went out under the CARES Act. But where the HEROES Act differs is that it also calls for $1,200 per child for a maximum of three children per household. Under the CARES Act, a household with two qualifying adults and three eligible children would've received $3,900 in stimulus cash ($500 per child), whereas with the HEROES Act, that same household would be in line for a $6,000 payment. Full payments would go to individuals with incomes below $75,000 and married couples with incomes below $150,000. For households with higher income levels, the payment level would be reduced gradually.

How to get by without a second stimulus check

Though Americans might be pleasantly surprised if a second round of stimulus checks comes out of Washington, it's important to accept that it may not happen. If you're in a tough spot financially and don't have savings to tap, your best bet may be to try borrowing money affordably, whether by applying for a personal loan through your bank or for a home equity loan or line of credit. At the same time, don't hesitate to ask for relief from those you owe money to if you're struggling with your expenses, and especially if you're out of work.

Reach out to your landlord or mortgage lender and ask to hit the pause button on your housing payments. As of mid-May, 4.7 million U.S. mortgages were already in forbearance, so you will be far from alone in making the request. Likewise, contact your auto lender and ask for more time to submit your next car payment.

Finally, even if a second stimulus payment does get approved by Congress, it may not happen for a while. And remember that when the first round was approved, checks took a lot longer to reach some households than others, so recognize that history could repeat itself. Either way, if you're in financial trouble, it's still in your power to ask for -- and hopefully find -- a bit of relief.

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