Stimulus Update: Why Another Federal Check Would Be Bad News

You may hope for another stimulus check -- but that outcome would likely mean bad things are happening.

The federal government provided three stimulus checks during the earlier part of the COVID-19 pandemic, and many people are hoping for more. In fact, a petition requesting ongoing payments for the duration of the pandemic has received millions of signatures.

But while getting more money deposited into your bank account might sound nice, it would actually be really bad news if a fourth check came your way. Here's why.

This is the big problem with a fourth stimulus check

A fourth stimulus check would not be a good thing for one simple reason. The federal government only provides stimulus money when they believe it is necessary to improve a bad economy or help people cope with an economic crisis.

For example, each of the first stimulus checks that were authorized by Congress were issued when the U.S. was in a state of strict lockdown and when people were very worried about making ends meet as the pandemic raged. The third payment, which only Democrats supported and which was passed over the objections of Republicans, was still passed at a time before COVID restrictions had been mostly relaxed throughout the entire country.

Even prior to the COVID-19 pandemic, when federal financial relief came, it was generally during a recession or other financial crisis. And this makes sense because when things are going well, there is no pressure on Congress to find consensus around passing legislation that offers monetary assistance.

In order for another stimulus payment to be issued, this likely means the country would need to end up in a major recession or the COVID-19 pandemic would need to intensify again, perhaps because of a more dangerous strain that the vaccines were not effective against. No one wants these things to occur even if that would mean that another payment is sent out.

Does that mean you shouldn't hope for more stimulus money?

Although you likely should not hope for a fourth check from the federal government due to what this would mean for the country, things are different when it comes to financial help from your state.

The federal government provided states with lots of financial aid in the COVID relief bills which has led many local governments to end up with a budget surplus. A number of states are giving some of this money to residents in the form of various types of stimulus checks. The issuance of these payments isn't directly linked to any financial disasters since the government is just distributing extra funds.

So, if you want another stimulus payment this year, the best outcome would be for a payment to come from your state. You can check if the place where you live is among the locations handing out payments by visiting the website of your local Department of Revenue.