You filed your taxes yesterday and put your check in the mail. Hopefully Uncle Sam will have a check for you too. Yes, that’s right Uncle Sam will be mailing you a stimulus check equal to $600 per adult and $300 per child. Some families could possibly receive a few thousand dollars.
1. You will receive the full amount if you are an individual with income less than $75,000 or married with a combined income less than $150,000. If you earn more than those limits, your check will be reduced by 5% of the difference.
2. The sooner you filed your return, the sooner you will receive your check.
3. If you chose direct deposit of your tax refund on your tax return, your stimulus check will also be sent via direct deposit quicker than those requesting a mailed paper check.
4. The date your check will be processed is based on when you filed your taxes and the last two digits of your social security number. To find out exactly when you can expect your check you can visit the IRS Resource Page: http://www.irs.gov/newsroom/article/0,,id=180247,00.html
Now once the check arrives, don’t just spend it at the nearest store. Here is how to make the most of the money.
1. If you have any credit card debt, this money should go straight to your bank. Paying off high interest credit cards will give you an immediate return equal to your interest rate. So you might be looking at getting double digit returns for your money. Not to mention how your credit score will increase when you pay off debt.
2. The next priority is to establish or build up your rainy day fund. This is money you set aside for emergencies. The funds should be invested in money market funds or short term CD’s. At many banks, you can find rates in the 3% range.
3. For those with no credit card debt and a healthy rainy day fund, they should consider using the checks to fund their own retirement or their children’s college savings.
If you have all your financial ducks in a row then you can take advantage of the many offers that are popping up at stores. Sears just announced they will offer a 10% bonus to those who convert their checks into a Sears or Kmart gift card. I am sure many more stores will jump on this bandwagon to lure customers to their store to spend their checks.