16 Mar

5 Ways to Make the Best Use of Your Stimulus Check

The pandemic is still taking a toll on the financial well-being of many Americans, and the 2021 American Rescue Plan is intended to ease some of the burdens. The third round of economic stimulus payments is expected to be sent out soon. You can learn more about who’s eligible, and the timing at IRS.gov/coronavirus.

Whether the money means help with necessities or being able to afford a few extras, it’s important to think about how you can make the best use of any relief payment.

Prioritize necessities
If the pandemic has left you in a hardship situation, the first thing to do with any stimulus check is to use those funds to cover essentials for you and your family. The intent of economic relief bills is to help those in need with necessities like housing payments, utility bills and groceries. Navigator Members who are dealing with financial difficulties as a result of COVID-19 can request a review of your situation. While automatic COVID-related payment extensions and COVID Relief Loans are no longer available, you can ask for consideration due to special circumstances by calling our Member Contact Center, 800-344-3281. Each request will be handled confidentially and on a case-by-case basis.

Start or supplement an emergency fund
Although Congress continues to consider sending additional relief checks, if, when and how much will be approved is not certain. If at all possible, consider using at least a portion of your stimulus check to create or add to a “rainy day” fund. Many financial experts recommend having three to six months’ worth of living expenses in a liquid savings account available to support you and your family during an emergency. That may have to remain a goal for the future, but any amount you can set aside gives you a cushion. Consider setting up an automatic transfer to your Navigator savings account to help make saving easy, as well as easy to access.

Pay off debt
While completely paying off debt may not be possible, it’s a good idea to pay down debt whenever you can. Every little bit helps, so focus on whittling down debt by paying more than the required minimum amount. Refinancing to a lower interest rate (such as for a personal or car loan) may also help you pay down debt faster. Talk to a Navigator Team Member to see if an auto loan refinance, a credit card balance transfer or a debt consolidation loan can help your financial situation. With auto loan rates as low as 1.99%credit card rates as low as 10.9% and an array of personal loan options, you may be able to lower your monthly payments, helping relieve some of the stress of a challenging time. You can even apply online safely and quickly.

Build great credit
Making on-time payments and handling credit responsibly will raise your credit score, a number that is considered for a large loan such as a mortgage, or even getting a job or apartment in some cases. Navigator’s online bill pay and other e-services can help you make payments on schedule. In addition to paying accounts on time, preferably for at least six months, another way to boost your credit score is with a secured credit card. No credit or poor credit isn’t an issue with a secured credit card which is backed by the cash deposit you make when you open the account. The deposit is usually equal to the credit limit available to make purchases. Account activity and payment history are reported to credit bureaus. Responsible use can help increase your credit score to be eligible for an unsecured card and the return of your initial deposit. Navigator’s Secure Credit Card has no application fee, no annual fee, no prepayment penalty and can be used anywhere Visa® is accepted. Plus the interest rate is a low fixed 12.9% APR. You can even apply online.

Save toward a long-term goal
Whether you’re looking ahead to retirement, making plans for a mortgage down payment, hoping to send your kids to college or simply dreaming of an extra special Christmas this year, Navigator offers convenient and flexible savings options designed to meet your needs. If you’re in a position to set aside a portion of your income or a portion of your stimulus check, the sooner you begin to set aside even a small amount, the quicker you’ll reach your savings goal. Benjamin Franklin coined the phrase, “A penny saved is a penny earned,” meaning to save money is as beneficial as earning the same amount. In truth, a penny saved is worth more than a penny due to earning interest over time. Even if you’re not able to contribute to a savings plan, you can begin saving money with every purchase made with your Navigator debit card if you’re enrolled in our Save’N Up Debit Card Savings Program. Rounded-up savings earn 5.5% APY, and Navigator will even match your rounded up saving up to $300 per year.

The effects of COVID-19 have left even the most experienced economists debating the long-term effects on the economy. But despite all the uncertainly, you can rely on Navigator Credit Union for more ways to save, pay off debt, manage loans and prepare for your future. We’re thankful for the trust you have placed in us, and we’re as committed as ever to providing the strength, stability and financial resources our Members need – no matter what happens on life’s journey. For details about banking with Navigator while the COVID-19 pandemic continues to affect our communities, visit navigatorcu.org/community-strong.