Millions of people have lost their jobs in the wake of COVID-19, and while unemployment benefits can be a lifeline in that scenario, they're often not enough to compensate for an absent paycheck. That's part of the reason a massive economic stimulus package was introduced in late March that calls for, among other provisions, a one-time $1,200 payment for eligible Americans whose income falls below a certain threshold.
Working-age folks who are without a job may need to use their stimulus checks to pay for essentials -- things like food, medications, and rent. But what if you're already retired and therefore aren't counting on that stimulus check to pay your bills because you're still getting Social Security and have the option to tap your retirement savings as needed? You have several options for putting it to good use, so here are a few to start with.
1. Pad your emergency fund
An emergency fund is something you need at any age, so if yours is lacking, consider adding your stimulus check to it. Even in retirement, you should aim to have enough money in easily available cash to pay for at least three months' worth of living expenses, so if you're not quite there, make padding your emergency fund your priority.
2. Cover home or vehicle repairs
Spending money on existing home or car repairs can help prevent minor problems from turning into major ones. If you've been putting off home projects or work on your automobile to conserve funds (you may be choosing to limit retirement plan withdrawals right about now to avoid having to cash out investments at a loss), your stimulus could help you prevent future headaches.
3. Invest in your health and wellness
The COVID-19 crisis hasn't been easy on anyone, but seniors may be feeling some added pressure. For one thing, you may be worried about falling ill and suffering extreme symptoms. You may also be struggling with feelings of isolation if you're no longer seeing loved ones. As such, it pays to spend your stimulus check on something that could improve your mental and physical health, like fitness equipment, a subscription to an online yoga class, or even a series of appointments with a counselor or social worker who can help you get through these difficult times. Along these lines, if you lack the technology needed to stay connected to the people you care about, invest in it. That could mean buying a tablet or paying for a faster internet connection than the one you have now.
4. Invest in your safety
If you're older, now's not the best time to be cramming into grocery stores to buy food. But grocery delivery can be expensive, and it may be outside your usual budget. If that's the case, why not use your stimulus payment to treat yourself to that added convenience? It could not only make your life easier, but help you stay safe.
5. Invest in the stock market
As a general rule, you should never invest money you expect to need within seven years. But if you don't need your stimulus per se, you have a prime opportunity to grow that $1,200 into a larger sum. You could buy individual stocks you've had your eye for a while, or put your money into index funds, which track the broader market.
Right now, Americans on a whole are hurting financially, and seniors aren't necessarily the exception. If you're getting a stimulus check, be sure to use that money wisely. But also, don't hesitate to spend it on things that make your life easier and help you get through this turbulent period.