The IRS has been quick to get that money out to those who need it.
Perhaps the most celebrated provision of the American Rescue Plan, the recently-signed $1.9 trillion coronavirus relief bill, is the round of $1,400 stimulus checks that comes with it. Though the bill was only signed into law two weeks ago, the IRS has been working hard to get stimulus funds out to the public. In fact, the agency announced yesterday that about 127 million payments have already gone out, totaling about $325 billion.
Who's gotten stimulus money already?
The majority of people who have already received a stimulus are those eligible for direct deposit. The IRS can quickly issue electronic fund transfers in batches, and those payments have already hit a large number of bank accounts.
But those who are waiting for a stimulus in the mail will need to sit tight a bit longer. The IRS can only issue a limited number of physical payments at a time. So far, about 15 million paper checks totaling $34 billion have been sent in the mail. Another 5 million prepaid debit cards have also gone out already, totaling $11 billion. But if you're not eligible for a stimulus via direct deposit, you may have to wait until well into April to get your check or debit card.
What to do with your stimulus
Many people are counting on their stimulus money to cover immediate bills or pay for household expenses like food and prescriptions. If you're not in that same spot -- say, you're still working and your paycheck can cover your essential living costs -- then you may want to save your stimulus check.
If the pandemic has shown us anything, it's that financial emergencies can catch us off guard. So take a look at your emergency fund and see where it's at. If you don't have at least three months' worth of living expenses available in your savings account, then you may want to sock your stimulus away in the bank.
If you're happy with your savings but have credit card debt, you should use your stimulus to chip away at the balance. Not only can debt cost you a lot of money, but it can also damage your actual credit score.
Of course, if you don't have to pay off debt, you may be inclined to pump your stimulus into the economy by using it to make purchases. After all, isn't that what the money is for?
If you're doing well financially, there's nothing wrong with going that route, but make sure there's not a more important use for that money. The last thing you want to do is spend your stimulus on electronics, only to wind up in a bind a month or two later when an unplanned bill pops up and you don't have enough money in savings to take care of it.
In the coming weeks, the IRS will continue to issue stimulus payments via direct deposit, checks, and debit cards. If you want to know where your money stands, use the IRS's Get My Payment tool to check up on your stimulus. That way, you can better plan for its arrival.
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