The unprecedented Coronavirus Aid, Relief, and Economic Security Act (CARES Act) was created to support both businesses and individuals in this time of need. One of the biggest impacts the program will have on the wallets of Americans is the stimulus check.
Frequently Asked Questions Regarding the COVID-19 Stimulus Package
How much will my check be? According to IRS.gov, the U.S. Treasury will disburse up to $1,200 per adult for individuals making $75,000 or less and $500 per child under the age of 17. For any $100 above the $75,000 threshold will reduce the amount by $5.
When will my check arrive? The Treasury reports that individuals could see direct deposits as early as April 9 and by April 14 at the latest.
How do I know if I qualify? If you are a taxpayer who filed in 2019 or 2018, you automatically qualify. Nonresident aliens, individuals without a Social Security number or Taxpayer Identification number, and some dependents do not qualify.
How will I get my payment? Most people will not need to take action to receive their payment. The IRS will use the account information used when filing taxes to send via direct deposit. If the IRS does not have your direct deposit information you will be able to submit your information online through a web-based portal.
When You’ve Lost Income
If you’ve lost your job due to COVID-19, now is not the time to be complacent. Once you recover from the initial shock of your situation, there are a few steps you should take to get prepared.
1. Take stock of all of your monthly payments and debts. If you don’t already have a budget drafted, you’ll want to make sure you have a full view of your finances before you seek out assistance and relief.
2. Take advantage of any additional relief programs. Once you have an idea of your current standing, you can begin reaching out to utility companies and creditors. Whether you need to pause your subscriptions or defer your mortgage payment, many organizations are set up to help you in your time of need. In addition, apply for unemployment if you qualify.
3. Make a plan for your stimulus check. Now that you have eliminated some of your short term financial obligations, you’ll have a better picture of where your stimulus money should go. Focus on non-negotiable items like housing and food. By making sure your basic needs are met, you should feel a sense of relief.
4. Consider additional credit options. For many, even payment deferrals and stimulus checks won’t be able to make ends meet. If that’s the case, you may need to consider accruing debt to cover expenses. As long as you have limitations in place about what you will use it for and how it will get repaid, a credit card or personal loan could be your best option.
When You Have Steady Income
Some individuals have been lucky enough to maintain their employment status and steady paycheck. For those who will be able to use the stimulus as a “bonus”, now is a great time to build financial resilience.
1. Get ahead on debt repayment. Even if you’ve been able to maintain your income, most people still have some amount of debt they owe. Consider getting ahead on your monthly payments or paying down a credit card with a low balance.
2. Build your savings. If there was ever an example of why you should build an emergency fund, it’s the current state of the world. While you may feel secure right now, this unprecedented emergency has shown just how unpredictable things can be. Deposit your stimulus check into a high-yield account so that you can continue to build your emergency fund.
3. Consider helping others. If you’re employed, are in good standing with your debts, and already have a healthy emergency fund, consider yourself lucky. Use your check as a true economic stimulus by spending your money locally or donating to charities or loved ones in need.
We’re Here to Help
While we may have answered some of your questions, we understand that you’ll likely have many more. Carter Bank & Trust is proud of our tradition of care and we will continue to provide service that over-delivers.