WS Chronicle

By Lisa Terry

Whether you were financially impacted by the pandemic or not, the luxury of receiving a stimulus check or tax refund can be quite enticing. Spring is a perfect time to create new, healthy financial habits. Here are a few tips to consider before cashing that check or swiping your debit card.

*Put a plan on paper before you receive your funds or spend any of your stimulus check. Make an itemized list of how you intend to use your funds so that you are aware of how much you will have left. Planning can help you get the most out of your money. Think about needs over wants!

*Do you have a savings account? Do you have funds set aside for an emergency? Start one immediately or increase your current savings. Peace of mind is priceless, but a flat tire or brake job is not! Check out www.AmericaSaves.org for tips and take a personal pledge to save.

* Negotiate past due bills. You may have fallen behind on basic living expenses due to loss of income because of COVID-19. Prioritize a list and calculate the total amounts past due to make them current. Is there room to negotiate if you can’t pay it all at once? Can you make payment arrangements for the remaining balance?

* Pay down debt. Look at any debt you owe and prioritize based on either highest interest rates or lowest balances and pay down your debt.

*Invest. This lump sum is an opportunity to invest in your future or your children’s future – savings, education, investments, etc. Do your research. Find someone who can give you sound advice.

* Check your credit report for accuracy and dispute errors. About 85% of credit reports have inaccuracies. Having available funds is also a prime time to pay off or negotiate collection or charged-off accounts to work toward improving your credit. You can check your credit for free every 12 months at www.annualcreditreport.com.

* Establish credit. Consider setting aside $500. You can contact a local bank or credit union if you are ready to reestablish credit by opening a secured credit card.

*Asset maintenance – car and home. Will it be cheaper to fix the car you have instead of using a lump sum like this stimulus payment to buy a car with payments? Will you be able to afford full coverage insurance, maintenance, and payments with a new car loan term? Have you had to skip over HVAC service or other common household repairs? Consider home or car repairs to get more life from your current assets.

* Donate to charity. You may be in a position to make a charitable contribution to an organization that is important to you. There could be future tax deduction benefits if you make this choice. In addition, studies show that donating to a special cause brings increased happiness, improved self-worth, and changes lives for the better!

If you are not sure what to do or where to start, just pause. Save it. Sit on it. If you would like to meet with a counselor to help you with goal setting and prioritizing your finances, contact Financial Pathways of the Piedmont: 

336-896-1191 or email info@financialpaths.org.

Lisa Terry is the director of financial management and education at financial Pathways of the Piedmont. Reach her at lisa@financialpaths.org or call 336-837-0656.