ECONOMIC STIMULUS CHECKS

In an effort to fuel the U.S. economy, the President and Congress have created a program that will provide Economic Stimulus checks to millions of households across the country. Individuals and households will be receiving checks over the next several months that will range from $300 up depending upon the size of the household. Many low income households may be eligible for this money, even if they do not usually file a tax return. You should consult a tax advisor for more information.

I’m not writing to announce this package, though. That has already been done in many other ways. I’m writing to suggest how to spend the money if you are one of the many who receive a check. The federal government wants you to spend this money on consumer goods in order to circulate money through the economy. While this may or may not create the desired effect in the economy, it is probably not a strategy that will create a long term benefit for you. Make no mistake, the government did not create this program to help you, or because they want you to have a big screen TV.

I know, you’re already dreading it: “Pay off the charge cards”.  Yes, that is indeed my first suggestion. But, besides the obvious personal benefits of no longer paying a big chunk of your monthly payment in interest, I also think that this would help the economy. This country is swimming in credit card debt. If each of us paid their share down, just a little, it would boost confidence and competitiveness in financial markets.

If you must spend the money, invest it in yourself. Take a class, get a membership at a fitness center, or deposit the money in an IRA, IDA, or savings account.  After all, it IS your money.