You can have a huge income and all the money in the world, but how you spend it determines how much of it you keep. Over the years, I have discussed spending many times and it is extremely important to think about how you spend every dollar. Some of you may have been laid off, some of you may be working reduced hours, and some of you may not be impacted at all by Covid19. It has always been about how you spend – is something a need or a want? Can payment be deferred? If you have received a stimulus check, here are a few spending tips:
Shore Up Your Emergency Fund. Ideally, you should have at least three to six months’ worth of living expenses in a savings account. If you’re not there yet, your stimulus check is a good start.
Pay Off High-Interest Debt. If you’re carrying credit card debt, you’re probably paying upwards of 15%. You can free up a lot of cash by paying off those cards.
Save For Retirement. If you haven’t funded a Roth or traditional IRA for 2019, there’s still time to make a contribution that can lower your 2019 tax bill.
Please be smart during this trying time and be safe.