1. PERSONAL FINANCE

Will We Get Another Stimulus Check?

Will We Get Another Stimulus Check?
BY Justine Nelson
May 6, 2020
 - Updated 
Sep 26, 2024
Key Takeaways:
  • The stimulus check program ended in 2021.
  • Some taxpayers qualify for additional child tax credit in 2022.

The coronavirus stimulus check was meant to help Americans to protect their financial well-being; but the first check distributed only went so far. Can we depend on another stimulus check?

As the pandemic continues, the government is looking for more solutions to ease the financial difficulties so many Americans find themselves in at this time. Another stimulus package is being considered and has passed the House–including a second round of stimulus checks–although there is a lot of debate in the Senate about the details.

At the time this post was published, government officials are still determining what kind of financial support should be included in the next stimulus package. Here is a look at what’s being discussed, and how you can plan accordingly.

Has the first stimulus check helped at all?

The CARES Act approved a one-time payment for qualifying Americans during the coronavirus outbreak. These federal stimulus checks have been trickling out, providing a maximum of $1,200 for single income earners and $2,400 for couples, plus $500 per child.

While the stimulus checks were meant to help people in need, some would say that it isn’t enough. The pulse survey conducted by Freedom Debt Relief found that 59% of respondents disagreed that the check will be enough to get them through the current economy. In many cities, the cash assistance isn’t enough to cover one month’s rent. To make the situation even more difficult, not everyone has received a stimulus check, and the delivery could stretch out for several months.

What about the $2,000 a month stimulus check?

You may have heard about a second stimulus check that includes a $2,000 per month payout. At this time, there are multiple proposals, but no such recurring cash assistance has passed in Congress. One such proposal, the Emergency Money for the People Act, would hand out these payments for at least six months, but potentially for an additional six months if the employment-to-population ratio does not go back to pre-COVID-19 levels of 60% or more.

This new proposal includes adults who did not qualify for the first wave of stimulus checks, such as college students or disabled adults who are claimed as dependents. Qualifying individuals under this proposal are as follows:

  • Americans age 16 or older who make less than $130,000 would receive the full $2,000 monthly amount.

  • Married couples who make less than $260,000 combined would receive at least $4,000 per month.

  • Couples with children would receive $500 per child per month, up to three children.

  • Dependents, such as college students or adults with disabilities, qualify to receive a monthly cash payout.

It is not clear at this time if this or a similar proposal might pass congressional approval, but it wasn’t included in the package recently passed by the House, so it’s unlikely at this time.

Should everyone get a second stimulus check?

The first stimulus check included tiered payout amounts. If you made more than $99,000 per year as a single income earner, you didn’t receive a stimulus check. Now there’s talk about expanding those limitations to higher income earners.

This raises some concerns. Should everyone get a second stimulus check? More than 36 million Americans have filed for unemployment and arguably, they should receive a stimulus check first. However, under the Emergency Money for the People Act proposal, those who are still employed are slated to receive a second stimulus check.

Those who have filed for unemployment are navigating a loss of medical benefits, trying to pay bills, and looking for a new job. An additional stimulus check could help in the short-term, but likely won’t cover all of the essentials. Take the cost of groceries, for example. The average couple spends $621 per month on groceries, according to the U.S. Department of Agriculture. Add that to your other expenses, like rent, utilities, and car expenses, and the costs are well over $1,200.

If you’re still employed but have experienced a pay cut or temporary furlough, your finances are likely impacted, too. Unemployment benefits aren’t available in this scenario, so a second stimulus check could help you stay afloat temporarily.

How could the second stimulus check affect personal debt?

Depending on your situation, a second stimulus check could help you pay off personal debt, but only if you spend it wisely. First, make sure you can still cover your basic living expenses. If you have already spent all of your first check, a second one could continue to pay the bills in the short-term.

There are currently measures in place for borrowers, like waived federal student loan payments and mortgage assistance programs. A second stimulus check could help you pay down debt or at least continue to make the minimum payments if you haven’t been able to get any forbearance on your debt.

If you are still employed and you can cover basic living expenses, you could prioritize debt payments. If you have high interest debt, focus on that first, putting any additional money towards the most expensive debt you have.

Other stimulus ideas that are being discussed

Along with another cash payout to Americans, other stimulus ideas are being discussed. Things like infrastructure upgrades, state and local government assistance, and full forgiveness of rent and mortgage payments might be included in the next stimulus bill. These additions could be beneficial during the pandemic. A plan is also in the works to expand internet access to neglected areas of the country. This means more people could work from home or seek medical treatment virtually. Unfortunately, it is not clear whether these specific recommendations have a good chance of passing.

Another important issue that is being discussed are payroll tax cuts. The CARES Act included temporary payroll tax cuts for employers, and could be included in the next phase. Any payroll tax cuts could be beneficial for those workers who still receive a paycheck, but worrisome for social security beneficiaries.

These taxes support those who are dependent on social security income to cover their living expenses. A cut would mean more money into the pockets of those who are still working, but less cash for those living off of social security. A solution for some could create problems for others, so they should be viewed from all angles.

How to plan for the short-term

Rather than banking on a second stimulus check, you can set things in motion for your finances in the short-term. While the government tries to figure out a solution, there are a few things you can do.

  • Make sure you file for unemployment benefits. If you lost your job due to the coronavirus pandemic, file for unemployment benefits immediately. The sooner you file, the sooner you can start receiving a cash payout.

  • Apply for forbearance or deferment programs. Those who can’t afford to make payments can look into forbearance or deferment programs.

  • Stockpile cash. If you have little to no savings and still have a paycheck, boost your cash reserves.

  • Basic living expenses takes priority. Make sure you can cover things like rent or a mortgage payment, utilities, gas, and food.

How to manage money, debt, and more

The current state of the economy, coupled with your money challenges, can make it difficult to find your way financially. Our How to Manage Debt guide was created to help you evaluate your options clearly and get on that path to a better financial future. Get started by downloading our free guide right now.

Editor’s Note, May 20, 2020: This post has been updated to reflect the latest actions by Congress regarding ongoing stimulus payments or other support.

Learn More:

Debt relief by the numbers

We looked at a sample of data from Freedom Debt Relief of people seeking debt relief during August 2024. This data reveals the diversity of individuals seeking help and provides insights into some of their key characteristics.

Credit card balances by age group for those seeking debt relief

How do credit card balances vary across different age groups? In August 2024, people seeking debt relief showed the following trends in their open credit card tradelines and average credit card balances:

  • Ages 18-25: Average balance of $9,300 with a monthly payment of $265

  • Ages 26-35: Average balance of $12,920 with a monthly payment of $356

  • Ages 36-50: Average balance of $16,196 with a monthly payment of $453

  • Ages 51-65: Average balance of $16,345 with a monthly payment of $475

  • Ages 65+: Average balance of $16,757 with a monthly payment of $446

These figures show that credit card debt can affect anyone, regardless of age. Managing credit card debt can be challenging, whether you're just starting out or nearing retirement.

Credit card debt - average debt by selected states.

According to the 2023 Federal Reserve Survey of Consumer Finances (SCF) the average credit card debt for those with a balance was $6,021. The percentage of families with credit card debt was 45%. (Note: It used 2022 data).

Unsurprisingly, the level of credit card debt among those seeking debt relief was much higher. According to August 2024 data, 89% of the debt relief seekers had a credit card balance. The average credit card balance was 15659.

Here's a quick look at the top five states based on average credit card balance.

StateAverage credit card balanceAverage # of open credit card tradelinesAverage credit limitAverage Credit Utilization
Connecticut$18,8179$28,21875%
Arkansas$18,7737$24,23796%
New Jersey$18,3729$26,61179%
New Hampshire$18,2558$25,17081%
Massachussettes$17,9428$25,53877%

The statistics are based on all debt relief seekers with a credit card balance over $0.

Are you starting to navigate your finances? Or planning for your retirement? These insights can help you make informed choices. They can help you work toward financial stability and security.

Tackle Financial Challenges

Don’t let debt overwhelm you. Learn more about debt relief options. They can help you tackle your financial challenges. This is true whether you have high credit card balances or many tradelines. Start your path to recovery with the first step.

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