What to do with your Stimulus Check: Home Ownership

The US government has said it will be handing out checks for $1200 to every American adult, with an additional $500 per child. As of this moment it's a one-time payment, but there is the high likelihood that there will be additional checks as the pandemic gets worse. With the recent changes in unemployment benefits most Americans will make almost their entire salary while not working, so is the Stimulus check free money? For most people, yes.

If you lost your job due to the Coronavirus Pandemic, and are currently on unemployment, then you should have no problem paying your rent and other bills. You were living on the same amount of money before, and without the ability to go out and spend, there is no reason you shouldn't have enough money for your needs plus some to put aside. Now add $1200 more. What should you do with it?

The answer right now is save it, obviously. No one knows what the future will hold, so at least for the short term , when your money arrives it shouldn't get touched. During this entire outbreak you should be saving every penny you have. If you come out of this without medical bills or a very serious loss in wages then it's going to be an exciting time for investments. However, what if you don't want to invest your money?

Let's say the government gives out just one more stimulus check after this one, and you were able to leave the money alone. If you are single and you walk away with about $2,500 then that is a down payment on a new car. Do you and your partner share a bank account? 2 Stimulus checks for 2 people is $5,000 which could be used towards a down payment on a house.

No matter what you were considering doing with your stimulus check before, the fact of the matter is that when money like this comes around it shouldn't be spent on a bigger television or new phone; this money should be used to better your life in the most fiscally responsible way possible. If you aren't going to invest it, then at least use it to get the highest return possible.

Renting an apartment or house is great, and if you're in a bigger city then you may not have a choice, but home ownership is the first step towards financial freedom. In most areas a mortgage payment ends up being far cheaper than rent, and by building equity in your home you can later refinance to a (possibly) better rate.

Don't discount yourself for a home loan just because you don't have perfect credit. There are many fixer-uppers available on the market, and with the right down payment you can get yourself down to affordable monthly payments that allow you to set aside money for remodeling projects. Check out a local real estate listing and see what is available in your area today. Start considering whether home ownership is for you, and if it is then make the change.