President Bush has spoken, today calling for "an economic growth package as soon as possible." (For more see Chris W.'s Gather article, "Jumpstarting the economy: devil in the details")
With that nod, Congress is discussing several options. One of the options bantered about is a federal kicker check sent to everyone in the U.S., to use -- in the words of Bush -- to immediately "make major investments" in entrepreneurial ventures and otherwise be used "as they see fit: to help meet their monthly bills, pay for higher costs at the gas pump, and pay for other basic necessities." Numbers tossed about for that kicker are up to $600 per person.
Here's my question to you. If you were to receive a $600 check, would it go to the things Bush suggests? If not, how would you use it?
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| Jennifer D. Meacham, Gather Money Correspondent | ||||
Jennifer's column, "The Bottom Line," is published every week to the Gather Essentials: Money channel. Jennifer is a business and personal finance columnist who covers money matters for RedwoodAge.com and real estate news for RISMedia, and co-authored the best-selling retirement investing guide "IRA Wealth: Revolutionary IRA Strategies for Real Estate Investment" (Square One Publishers, New York). Keep up on the latest news and analysis into how you can take control of your business and personal financial future by joining Jennifer's "Self-Directed Investing 101" network. | ||||
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Comments: 106
Everyone else, great ideas!! Sounds like we could collectively make quite an impact in our communities and beyond thanks to the sound spending strategies outlined here.
Or a legal prostitute in rural Nevada, but probably the 401k.
I would use half the money to expand my business a little, and the other half to restart a masonry business so my husband could work for himself again. Working for others in construction where we live has been a joke!!! We would definately be doing our part to better the local economy, since most of the construction companies here are all about lining the pockets of the owners, cheating the employees, and generally making sure the owners get their toys, their vacations and their big homes, while they cut the hours of the very people responsible for making the wealth of the owners.
$1,200 will help us chop down our credit card bill.
My pleasure Trish A.. Though paying off credit cards doesn't boost initial consumption, it does 1) allow you more spendable cash down the road, plus saving you quite a bit on interest that otherwise you'd have to fork out and 2) help the credit card companies -- major employers, though often outside the U.S. -- that of late also are struggling with getting paid back.
1. Am I correct in assuming this "windfall" is our tax money being given back to us so that we can pass it around among ourselves?
2. Is no one concerned about what this does to our staggering national debt?
3. What is the correlation between this action and what got us in this fix in the first place... overspending and taking on more debt?
4. What does this say psychologically? Does anyone besides me think this is pandering of the highest order? Does anyone else see this as a feel-good smokescreen to keep us stupid and pacified?
5. Why is no one telling us the truth about our broken lifestyles?
We need to face facts.... we are spending way beyond our means, both as individuals and as a country trying to maintain a standard of living that is impossible. Our entire way of life is dependent on the automobile and on cheap oil. Cheap oil is over! We need to fundamentally change the way we think and the way we live.
I admit to being naive about economics but I am a good listener. I have heard the explanations about how this is going to "jump start" the economy... get us out of the doldrums. People have cut back spending, as has business, because we can all see the black cloud looming.
6. Is there any reason to think that our country, our economic model, is immune to collapse such as happened in the old Soviet Union? Shakeouts happen. Businesses fail. Sometimes even very large financial institutions fail.
This money would move us so much closer to our goal of paying off a credit card and then allow us to have more spendable income. (We have chronic medical issues and expenses and are down to one income due to disability so this infusion of money will be helpful. We do not live an extravagent life style, no cable etc.)
Here's what $600 dollars would do at my house:
1. It would pay "almost" one month's worth of my health insurance premium,or
2. It would cover the heat bill for this winter. (And I'm in California!), or
3. It could buy groceries for the next 60 days, or
4. Put gas in the car so I can drive myself to a job I hope I still have in 90 days.
The big tax cut he tossed out here a few years ago didn't do squat for "real" people. Why does he think that tossing out $600 for "spending money" to the "real" people in this country is going to make a difference? It won't. This administration has NO CLUE!
It seems to be the norm with King George ~ when in debt, spend some more. How about CUT BACK THE SPENDING!!!???
As for the economy, why not cancel export subsidies? We are paying to raise prices on a number of commodities like corn, with no other benefit to the American consumer than higher prices.
PAY DOWN DEBT
Greg's suggestion is an even better suggestion for families with credit card debt. If you owe a couple thousand bucks and are paying 18% interest on it, it really makes more sense to get rid of a piece of the debt. Most investments are not going to make you the kind of money that you would save by eliminating the interest payments. do you know any stocks that can reliably return you over 18% per year? I don't.
Let's see, that's just enough to cover my rent and cable bill for one month; or half of what I need to fix my broken-down pickup truck; or one fourth of what we needed to pay for Donna's recent car repair bill (timing belt broke on her three-year old car).
There are questions that the $600 will NOT be sent to the lowest income earners in our country; the folks to whom $600 could actually be felt as a temporarily life easing infusion. For the majority of recipients, this $600 will be ice cream and candy money; a small morsel to be added to their portfolios; or spent on fulfilling a whimsy.
Wall-Mart will feel the biggest bump from this.
The other Bush bump came at the start of his administration; oft interpreted as saying "Thanks for electing me." I suspect with this bump coming at the end of his administration, it's his way of saying "Thanks for not impeaching me."
If Bush really wanted to stimulate the economy he'd eliminate taxes on the lowest earners and increase them on the highest earners; or stop greasing the wheels for overseas job sourcing.
. . buying votes in america . .
More Federal Reserve Notes & more Federal Debt
Really, I'm not confused. I'm angry. WHY don't they tell the truth for a change?
As to what we should do with the 600 bucks, maybe we should donate it to the top .5% who already have most of the rest of our money, in the hope that they could continue to tolerate their privileged lives!
I think that I would probably use some of it and save some of it. (I save a portion of everything I get) What worries me is that since the last stimulus package the economy has been slow for the middle class and humming along nicely for the upper class. I think that without tax cuts targeted at the middle class (real tax cuts) that things will not improve. I think that those who would reverse the tax cuts of 2001 and 2002 are correct. They didn't benefit the most people. The last stimulus did not make much of a difference. I see no reason to keep doing the same thing over and over and expecting a different result.
:)
Yes and yes
The way things are going, I'll need all the money I can get!
Its time to stary paying, not expect tax cuts. End the shrub tax cuts for the upper class, quit paying for Haliburton, et.al. and get out of the Iraq Occupation and we would have more money!
Less than a year left of the nekkid emperor....
It is shameful that this government cannot actually face up to the truth. And that people still believe in fairy tales about "stimulus packages" such as this saving the economy. What we really need is some honesty and some hard, serious legislative work in Congress that may put a hurt on everyone, including the big corporate donators, for awhile.
I would put the money towards my daughters obscene tuition bill.
Because of how the economy is, I wouldn't suggest anyone take it unless they have no other option, because chances are, the times won't be any better next year.
It reminds me of the paycheck loans- go in, sign a short term loan at a huge interest rate, and then pay it off with your paycheck. The problem is, those loans (like this one) are aimed at people who live pay check to paycheck, and it sucks them into a vicious cycle, costing them more and more money, while never getting ahead of the game, and only getting further behind.
If you can't afford to lose it next year, you really can't afford to take it now.
(Tongue firmly planted in cheek....but a week? Sheesh! Is no one else writing financial pieces?)
Ah, and maybe Donna, just maybe, it happened because this story has spent a week featured on Gather's homepage under "Money." (P.S. I'm guessing, though this is just a guess, that the money editor is on vacation for the time being....)
Thank you everyone for your thought-provoking comments over the past week. This article is an amazing team effort. As such, I'm forwarding the link for it along to a few of our legislators so that all of our voices can be heard in the crafting of this stimulus package. Here's crossing our fingers....
I KNEW there had to be a reason...so, thanks for the rebate.
The bill being debated in the U.S. House of Representatives, as we speak, asks for $600 per adult ($1,200 per couple) and $300 per child. Checks would be cut in June. I have heard nothing about this being a tax "rebate" that would later need to be paid back, but no confirmation that it's free and clear either. I'll keep you posted as the news comes in.
Also, WRT another persons comment. I don't think you can turn down the check. I don't think there is any formal mechanism to do that.
I personally will put this in my rainy day fund for when times get really tough economicly in the next couple of years.
Now the discussion focuses on a late-April check-cutting date, with $300 going to those making less than $3,000 per year and $600 for those above that threshold. We'll see how this pans out....
In the meantime, I'm thinking that whatever the amount is it will be distributed as a true "kicker check" -- meaning it's given free and clear and would only need to be reported on next year's tax return as income. That's how it's done in Oregon state, where money left in state coffers at year's end is redistributed to residents throughout the state in the form of an annual -- assuming the state is in the black -- mailed-to-you check.
Those who earn up to $75,000 individually or up to $150,000 as a couple will be eligible for the payments, said Republican and Democratic sources familiar with the tentative deal.
However, I still hear that the AP said payments won't be in the mail till June. It does seem like a refund or tax credit. However, it will be counted as income for this tax year. The CBO said that the weakness in the economy could push the deficit to $250 Billion. However, that does not include war spending $150 Billion and Social Security looting ~ $125 - $150 Billion. So we still have a massive debt. This will add to it. To the tune of $150 Billion. For people not paying attention that is a real total of nearly $700 Billion. Our grandchildren are going to be pissed.
We couldn't expand the children's health program, but we can do this?
Well, I know what I'll be doing with my $1,500. 2/3 to credit card debt, 1/3 to emergency savings.
Sorry, I won't be spending my check on crap made in China!
This is one of those ridiculous repub ideas that might sound good to someone who doesn't think much the first time you hear it, but after reflection you realize that the money's got to come from somewhere. And that somewhere is out of our pockets and the pockets of our children.
My full refund, whatever it is, will be going directly into my IRA to compound ad infinitum.
Keep our money out of the hands of rich repubs who don't understand how to manage our money!