How Stimulus Checks Can Give You A $ 14,000 Windfall This Year

Congress nears the finish line as lawmakers rush to pass President Joe Biden’s $ 1.9 trillion relief package by mid-March.

The program includes the third round of stimulus checks – up to $ 1,400 this time – plus an extension of emergency federal unemployment benefits, an expanded child tax credit and more.

So if you need more help paying off debt or covering household expenses, you might start receiving it in a few weeks.

Taken together, government assistance this year could provide a family of four with a stack of cash totaling at least $ 14,000, according to a new analysis. Here’s how your household could benefit from such a windfall in 2021.

How does the math work with $ 14,000?

Take the Smiths, a hypothetical family of four with two adults and two children aged 7 and 10, for example. Provided they met the stimulus check income criteria, the Smiths would have received $ 2,400 in January of the second round of payments: $ 600 for each adult and each child.

If Congress passes the current aid bill and Biden signs it, the family will receive an additional $ 1,400 per person, for a total of $ 5,600. Add that to the $ 2,400 at the start of the year, and you have a total of $ 8,000 in household stimulus checks.

Another part of the president’s COVID rescue program is increasing the child tax credit to give low- and middle-income families $ 3,000 for every child aged 6 to 17 by 2021. Half of that money would go in installments monthly (a different type of “stimulus check”) during the second half of the year.

Thus, the Smiths would receive an additional $ 6,000 for children – for a total of $ 14,000 in government relief this year.

Some households have even more to gain, notes a report by financial services firm Raymond James.

How do you raise over $ 14,000?

Families with children under the age of 6 can expect to receive credits of $ 3,600 per child instead of $ 3,000.

So let’s say you are a parent who is eligible for stimulus checks and you have two children aged 3 and 5. $ 7,200 – bringing your transport from Uncle Sam this year to a huge $ 15,200.

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There is even more money if you are one of the millions who were made unemployed during the pandemic.

The federal government paid unemployment premiums in addition to the usual state benefits. The current payments of $ 300 per week are expected to run out soon; the relief bill would increase these federal benefits to $ 400 per week and extend them until August.

Considering all the different types of federal COVID help available to families and individuals this year, “the American consumer will be largely in the best financial position they have been in, on average, for at least 40 years (probably never). “writes Raymond James analyst Tavis McCourt.

But McCourt adds that if the cash flow increases the chances of an economic recovery, it threatens to increase inflation in the near term.

What if you don’t qualify for $ 14,000?

Just this week, Biden agreed to a compromise with more conservative Democratic senators who would target stimulus checks and impose new income limits. Households with incomes over $ 160,000 (or $ 80,000 for one-earners) will miss the third round of out-of-pocket payments altogether.

If your household does not qualify for stimulus checks or children’s credit and you need more money yesterday, here are some things you can do:

• Reduce the cost of your debt. Credit is convenient, but interest is a killer. If you’re racking up a lot of expensive interest these days, there’s a better option. Make it easier to transport your debt – and offload it sooner – by consolidating your balances into one debt consolidation loan at a lower interest rate.

• Lower your insurance bills. Auto insurance companies are offering discounts to drivers who stay close to home during the pandemic. If your insurer isn’t budging, maybe it’s time to look for a better deal. And while you search, you could save hundreds on your home insurance by comparing rates to find a lower price.

• Reduce your mortgage payments by refinancing your mortgage. If you haven’t looked for a lower interest rate on your home loan in the past year, what are you waiting for? Rates remain historically low, and refinancing your mortgage could lower your monthly payment.

• Cut your budget and “write your own” stimulus check. By finding a few creative ways to cut your expenses, you could reorganize your budget to find an additional $ 1,400. Cut off your cable service or any monthly entertainment subscription you don’t use. Do you have a hobby or a special talent? Turn it into a side scramble to bring in extra income. And download a free browser extension that will automatically search for better prices and coupons every time you shop online.