Where should you invest the $1,400 money from your stimulus checks?
For most first-world countries, stimulus checks are given to the general population to help people get back on their feet. Stimulus checks are given to both individuals and businesses in pre-determined amounts depending on their status. In theory, this will help pay off the debt/rent of the displaced workers and/or at least encourage spending to help small businesses get sales. For businesses, it should help relieve the lost sales from lockdowns. Of course, fears of inflation is present since there is a sudden surge of cash.
More money out in the market = an increase in demand = an increase in prices.
Now, you can do whatever you want with your stimulus money. But we set up a quick guide just to give you an idea where to put your money to good use.
Clue: it’s not clothing, gadgets, appliances or car parts.
First, split your stimulus money into two parts. Maybe split it in:
- $1,000 and $400
- $700 and $700
Use the first half to:
Pay Debt
Like every other financial adviser. The safest most practical way of putting your stimulus check to good use is paying your debt first. Even if it’s sometimes more financially sound to invest, having debt out of your mind gives people a psychological boost because you can now focus on investing or hustling.
Invest in Bonds
Bonds are a surefire way of earning extra especially if it came from easy money. These are almost 100% secure and would at least discourage you from cashing in.
High Yield Savings Account
If you don’t want long-term investments and would like to be a bit more liquid, a high yield savings account is a good compromise. Interest earnings aren’t spectacular but at least your money isn’t just sitting around doing nothing for you.
Invest in Stocks
They say that the stock market is in a bubble right now. If you’d be patient enough, it’d be great if you would invest the money right when the market crashes! Or go with what Warren Buffett says, invest in an undervalued company no matter what stage. It’s hard to time the market. As long as you invest in a good company, you can’t go wrong.
Invest in Crypto
Bitcoin’s growth for 2021 is about 100% from January. And it’s actually a lot better for the other popular cryptocurrencies trying to catch up to Bitcoin’s market capitalization. Some investors might think that Bitcoin is just a scam but that has been the sentiment for quite a few years now. A lot of institutional investors have started to embrace cryptocurrencies and invested in them. Most notable of these is Elon Musk who invested $1.5 billion USD in Bitcoin.
Invest in Yourself
Warren Buffett credits the best investment in his life is actually a Dale Carnegie course on public speaking. Because of this course, he overcame his fear of speaking to other people and was able to capitalize on this newfound talent to speak to anyone, anywhere at any time. Warren Buffett wouldn’t be our beloved Oracle of Omaha if he didn’t take this course. He would’ve turned out to be just someone who invested stocks for himself. So yes, consider enrolling in something similar or any course that you think would help in overcoming your weakness.
Spend part of the money to help boost the economy.
Keeping the stimulus check for yourself is okay. But, it’d be better if you share the love. Buy from the local small businesses around you. They might be in more trouble than most because they are heavily leveraged and have put everything in their business. Supporting your local businesses will also mean more jobs in your community.
More jobs = Less crime
If people get to keep their dignity up, there’s no reason for them to go homeless and/or steal from other people. Remember Peter Parker regretted that time when he ignored the criminal who ended up killing his uncle Ben? Well, we all have some kind of power and responsibility too.
Spend some of that cash for the community buddy.