9 Smart-Money Ways to Spend Your Stimulus Check (and How Not To)

How to make the most of an unexpected windfall. 

Good news! The third round of stimulus checks is hitting bank accounts. For millions, this desperately needed relief to simply help them get by. 

But if your basic needs are being met—rent, food, insurance, medical care—then you have some choices as to how to spend your stimulus check. And there are plenty. 

But one caveat: Remember the intention. The stimulus payments were meant to help cover basic needs and stimulate the economy to help get Americans back on their feet. Experts warn against dashing out to buy risky stocks, investing in bitcoin, or any kind of get-rich-quick impulse buys. Ditto a new car or iPhone; those are wants vs. needs and don’t directly benefit your financial stability or that of those in your community. 

So. What are some smart ways to use that check? 

Pay down high-interest debts. If you’re carrying a high balance on a credit card, this is where you’re bleeding money. When you buy an outfit at Target and put it on a credit card, that’s like paying a 15-25% markup on the item. (You’re basically getting Target clothes at Nordstrom prices.) Instead, be sure to pay down cards monthly, and if you have any high-interest cards carrying balances, take care of those immediately. 

Tackle loans. 

A lump sum can go toward student or car loans to help lessen some of the burden (and interest) that you’re carrying and shorten the life of the loan. 

Save for retirement. 

If you have a 401K with an employer match, put that money here pronto! You’re essentially getting free money from your employer up to a certain percentage of your gross salary, and that can mean thousands a year if you meet the match requirements. 

Buy gift cards from a local business. 

A pre-purchase like a gift card means the business can get much-needed cash flow now, while you decide when to use your purchase—for instance, you can buy cards from a local restaurant now to plan a night out for an upcoming birthday or celebration. 

Contribute to a 529 for your kids. 

A 529 lets you invest and save pre-tax money for higher education. Hint: It’s best to invest larger sums early on, and let them compound over time. 

Improve your home. 

Some wise investments include curb appeal updates, fresh paint, light fixtures, wallpaper, and other inexpensive DIY projects that can change the look, feel, and increase the value of your home. 


Does your local school need school supplies? Food for hungry kids? PPE for staff? Your gift can have a ripple effect across the community for kids, teachers, and their families. To find a qualified charity helping those impacted by the pandemic, try Charity Navigator.

Pay your taxes. 

Tax time is upon us, and even though the deadline has been moved to May 17, you still may owe a hefty bill. Set some funds aside to cover it. 

Tip extra. 

The Uber Eats driver, your hairdresser, the bartender or barista, anyone whose livelihood has been impacted by the pandemic—and who put themselves on the line to care for others or make our life safe and convenient. 

For most of us, it’s rare to have a large sum of money fall into our laps. Making a plan to use it in a way that creates safety and benefit for ourselves and our community is empowering and allows it to help all of us recover—and rise together. 

If you’re grappling with how to budget, spend or manage your money or wish you had a more meaningful plan for your financial wellbeing, chat with one of our planners at Aspen Wealth Strategies. 

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