Coronavirus Stimulus Package: All the Facts On ‘How To Money’
By Diana Brown
April 6, 2020
Joel and Matt know that pretty much every single person in the country has been affected in some way by the Covid crisis, so on this episode of How To Money, they focus on the recent $2 trillion stimulus package that passed Congress. What new resources are available thanks to this package? What should we do with our stimulus checks? What about small businesses? They also answer listener questions about investing in real estate, pulling funds from an existing 401K, what might be happening with mortgage payments, and how to handle student loan debt. But first, here are some resources you may not already know about: Amazon is offering free kids’ books through Audible, and Walmart, Aldi, and Instacart are all hiring if you’re in need of some kind of employment.
But if working at the grocery store isn’t in the cards for you, the guys point out that part of the stimulus package is expanding unemployment benefits, giving people an additional $600 a week. It also extended those benefits to workers who historically aren’t eligible for unemployment, like gig workers, freelancers, and those who are furloughed – still technically employed, so they can still use their employer-based health insurance, but no longer receiving a paycheck. In addition, “pretty much every single American” is going to receive a check: $1200 per adult and $500 per child. The stimulus also made $350 billion available for small business loans. Taking on more debt “isn’t great,” they admit, “but it’s better than going under altogether,” and if business owners can retain their employees instead of laying them off, the loans could be forgiven completely, turning them “basically into a grant.” This “three-pronged approach” should have “a really big effect to keep us going” and help Americans feel a sense of financial security.
Then they answer some listener questions: the IRA contribution deadline has also moved to July 15 to coincide with the federal tax filing deadline, so you can continue to contribute to your IRA. Federal student loan payments are automatically stopped until September, with no interest being applied for 60 days, though they point out that this does not apply to borrowers with private loans. A listener in San Diego is thinking about taking money from their 401K to invest in a second rental property, but Joel advises against it. “You’ll be locking in your losses and missing the eventual ride back up,” he points out, as well as owing income tax on that money. They also discuss mortgage lending standards, the importance of emergency fund savings, the inspiring ways they’re seeing their community come together – figuratively, of course – during the quarantine, and so much more on this episode of How To Money.
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