A Stimulus Check Allowed Me To Get Ahead — Here Are All of the Impacts
Written by
Jordan Rosenfeld
Edited by
Molly Sullivan
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While it may feel great to receive money from the government, commonly known as “stimulus checks,” these payments, formally called economic impact payments (EIP), typically signal that times are tough for Americans.
For example, between March 2020 and March 2021, former President Donald Trump and President Joe Biden’s administrations administered three such EIPs to Americans, along with a variety of other relief programs, to target the economic struggles brought about by the COVID-19 pandemic, including the following:
- March 2020: $1,200 per income tax filer, $500 per child (CARES Act)
- December 2020: $600 per income tax filer, $600 per child (Consolidated Appropriations Act, 2021)
- March 2021: $1,400 per income tax filer, $1,400 per child (American Rescue Plan Act)
While experts may disagree on how effective these payments are at actually improving the economy or the financial situation of the average American, for one recipient of stimulus funds, Amanda M., a mother of two young children in Oregon who works in healthcare, the extra (and unexpected funds) enabled her to make financial headway.
An Unexpected Stimulus
Amanda and her family moved from California to Oregon in 2021 and, as a result, the stimulus that had been sent to her home went unclaimed.
“I got this nasty gram from the Feds saying ‘you have this check you have to cash in the next six months,’ and I thought it was spam, so I threw it away,” Amanda said.
When she got a second such reminder, she finally took it more seriously and visited the IRS website to see if there was, in fact, money awaiting her. It turns out a $1,200 check that she should have received at the end of 2021 was still available to be claimed.
“I didn’t even think we qualified for it,” she said.
A Bonus Card
Along with the $1,200 federal stimulus check, she and her family received a $600 Visa gift card, part of a gas rebate from the state of California. That $1,800 bought their family of four groceries for the entire month, as well as put a dent in her gas budget. Due to the rugged nature of the roads in the area where they live, she drives a “gas guzzler” whose costs add up quickly.
Though Amanda and her husband had received smaller COVID stimulus checks in the past, she said, “They didn’t make an impact like this one did.”
Credit Card Debt Loomed
Though not huge, she and her husband were carrying credit card debt on a high-interest card and were able to use the stimulus check to pay that off, as well as some minor outstanding medical debt.
Because their credit card is points-earning, it comes with a very high interest rate, around 23%. “So we’re constantly chasing that interest to keep it down because the points are worth it if we pay it off,” she said.
An Unintended Benefit
An additional benefit of paying off the credit card with the stimulus check is that Amanda was applying to nursing school and needed to take out student loans. It gave her a lower debt to income ratio, helping reduce her loan interest rate.
“It made it way easier to apply for student loans with no other debts.”
While her debt wasn’t huge, she said, “It was much nicer to not have money on my credit card, with that revolving debt.”
More Stimulus Welcome
As far as Amanda is concerned, she can attest to how much of a difference even a small amount of stimulus money can make in an average family like hers. “I see no downside to more stimulus checks.”
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