BOISE, Idaho — Millions of Americans started getting their stimulus money from the federal government this week.
Most individuals are getting $1,200, while couples who filed their taxes jointly will collect $2,400. Families with children under age 17 will also receive an extra $500 per child.
For many, how to spend the tax-free money is a simple answer.
On one hand, the idea of the stimulus checks is to help stimulate the struggling economy. On the other, many people have lost their jobs and need the money to pay bills.
We spoke with financial planner Dave Petso, who says how you spend the money should be well-thought-out.
(Editor's note: The following interview has been edited for length and clarity):
"Those of us that are still working, how can we reach out to businesses and people that are really struggling right now?" Petso said. "One of the things that people are doing is going out and saying 'let's go to a restaurant, let's do a takeout,' trying to do things that are stimulating the local businesses that really are struggling even if they're open.
"It's free money, they can use it in their communities and, and I actually recommend that, unless their jobs are insecure," he added. "If their jobs are insecure, there's no way that people should be doing anything but setting this aside until this is done because we need to make sure we have reserves."
Petso points out that whether you spend the money immediately to hang onto it really depends on your personal financial situation.
"This shows us anything can hit us anytime from anywhere," he said. "This is a total black swan. And people have to have more than a month set aside to make sure that they can pay their bills. For those that do, this is a great opportunity to help those around them."
For people who don't have more than a month's money set aside, Petso says the stimulus money could make all the difference.
"If you're wondering how you're going to make your rent payment, there it is," he said. "For some people who really were on the edge, this is going to be enough to get them through. We hope to get this economy going and people getting back to work, but it's going to take some time to get everybody fully-employed so again for those that are on the edge, this is certainly going to be a big help a big boost to get through."
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