The third stimulus check is the biggest one yet. But what should you do with it? Can you invest and multiply it? Here are 12 financially mindful ideas.

As the pandemic persists, most Americans’ financial positions are precarious at best, dire at worst. Thankfully our bank accounts are receiving their own helpful injection: a third stimulus check

While you might be tempted to splurge your check on a purse or a PS5 (no judgment), you might also consider these financially mindful options, which can help lower your stress and multiply your money.

There are many different ways you can choose to approach this. So, I wanted to give you a lot of different options, in hopes that at least one or two of them may resonate with your unique financial position.

Bulk up Your Emergency Fund

12 Ways To Spend Your Stimulus Check To Improve Your Finances - Bulk up your emergency fund

One of the best ways to improve your finances with your stimulus check is to bulk up your emergency fund. That is if you have one. If you don’t, it is absolutely time that you get one started. Trust me, you will be thankful when an emergency comes your way.

You don’t have to start big, but anything is better than nothing. Even if you only deposit ⅓ or ½ of what your stimulus check is, you have already helped create a financial buffer for yourself. 

I know that when my family’s emergency fund has at least six months’ worth of expenses in it, we feel much more secure than when it dips lower. The peace of mind of knowing that you are prepared for an emergency, should one come up, is absolutely incredible.

What helped me build my emergency fund up faster was a high-yield savings account. While what they consider “high-yield” these days isn’t exactly what it used to be, they still offer much higher interest rates than you would get at a traditional bank.

There are quite a few options out there, but one of my favorites is the CIT Savings Builder. You only need $100 to open an account, and there are no fees. If you are able to put in a minimum of $100 each month (or maintain a balance of $25,000 or more), then you will earn the highest interest rate they have (1.00%). See details here.

So, if you don’t already have an emergency fund set up, this is the first place I would suggest starting.

CIT Bank. Member FDIC.

Give Your Budget a Boost

Another way to use your stimulus money is to sprinkle it into malnourished areas of your budget. After all, the point of stimulus checks is to stimulate the economy and your budget is where you plan your spending. 

For example, maybe you’ve had to reduce your spending on entertainment, travel, or even groceries over the past year. If so, consider using your third round of stimulus money to replenish those silos. You may even consider planning to spread that money out over multiple months’ budgets, in order to create a small safety net just in case your income decreases.

Personally, I started out budgeting using a spreadsheet that I created in 2002 (which has thankfully evolved!). If you are new to budgeting, or just need a little help, there are a lot of budgeting tools out there. Some of these are free and some are not, but spending a small portion of your stimulus check on a subscription to one may not be a bad idea.

One app that can be a big help is PocketSmith, which serves as a personal assistant for your finances. What I like about PocketSmith is that it shows you the future. As you budget, the app demonstrates how today’s expenditures will affect your finances months, and even years, from now. The best thing about PocketSmith, though, is that you don’t have to pay a dime for the basic version. You’ll have to manually import your transactions and you’ll only get six months of future projections, but it’s worth it. 

Subscribe to a Financial Management Tool

Financial management tools (think budgeting tools) are extremely useful in improving your finances. They can effectively help you determine your weaknesses and figure out an action plan to help you reach your financial goals faster.

If you don’t have one in your toolbelt, why not consider spending some of your stimulus money on one? Because at the end of the day, using a tool to help you budget is going to save you so much money down the road. This is something almost all financial advisors agree upon – and anybody for that matter who has used one.

Most financial management tools have different plan options, set at different price points, so you can customize your experience to match your needs. There are many different options out there to help you manage your finances, but, two of my favorites are both very interactive, and have multiple options to help you maximize how you manage your finances.

Empower is another great example. They have been around for quite some time now, and I have been using them for years. They not only offer a net worth map (which is one of my favorite tools), but a portfolio analysis, fee Analyzer, and budgeting tool. 

Empower ties into all of your bank and investment accounts to aggregate the numbers and figures appropriately. This really helps to give you a bigger picture of everything that is going on with your finances.

(Personal Capital is now Empower)

Invest it

12 Ways To Spend Your Stimulus Check To Improve Your Finances - Invest it

If you already have an emergency fund and have a comfortable budget, then there is another great option. You could use some, or all, of your stimulus check to invest in the stock market instead. You could, with time, turn your check into even more money!

Since my husband and I have started investing in the stock market, it has become one of our favorite activities to help improve our finances. The average return on investments annually in the stock market is around 8%, which can really help improve your finances.

This doesn’t mean you are guaranteed an 8% return on your money every year. This is just the average over time. So, some years will be better than others, but there is no time like the present to get started.

Robinhood is an especially good option,  geared towards Millennials and Gen Z who are new to investing. Not only is it easy to get started, but they make it simple to navigate trades also. You can even perform all functions directly from their app on your phone, so you can manage your investments on the go!

Robinhood has no fees for setting up an account and it’s commission-free. Plus, they give you a free stock worth between $5 and $200 just for signing up!

Pay a Tax Preparer 

If you haven’t filed your taxes yet, and want to make sure you get the best return possible, it may be beneficial to pay a tax preparer. Tax preparers are experts at tax code and finding all of the tax write-offs you may be eligible for. I don’t know about you, but I happen to be a big fan of getting as many tax write-offs as possible because it reduces how much I have to pay in taxes. In fact, for me, it usually means I get a bigger return. Which I love!

If you aren’t sure a tax preparer is worth it for you and your unique situation, you could always go the tax software route instead. Tax software like TurboTax generally costs much less than a tax preparer does, but can still help you find write-offs to lower your taxes!

Hire a Financial Advisor

12 Ways To Spend Your Stimulus Check To Improve Your Finances - Hire a financial advisor

If you don’t already have a financial advisor, then this may be a good use of your stimulus check. Financial advisors are an essential tool to have in anyone’s financial toolbelt, definitely if your financial situation has recently changed. 

A financial advisor will go through every aspect of your finances with you to help determine the best path for you to reach your goal. And if you aren’t sure what your future financial goal is, they can help you figure that out, too.

Just make sure whomever you choose as your financial advisor is a fiduciary. A fiduciary is a fee-only advisor who doesn’t make commissions on sales. Therefore, fiduciaries have your best interest at heart. 

If you decide to hire a financial advisor using your stimulus check, then one of the best places to start is the Paladin Registry. This is an online marketplace specifically created to help you find a financial advisor that will work for you. Even better, they specialize in mostly independent fiduciary financial advisors, instead of advisors at brand name firms. 

Open a “Lazy Portfolio” of Long-Term Investments

Earlier I covered how you can use your third stimulus check to begin actively investing in the stock market using platforms like Robinhood.

But what if you’d like to multiply your money in the stock market without being so hands-on? What if you’re not sure what stocks and ETFs to pick?

Then a “lazy portfolio” might be perfect for you. The term “lazy” comes from how easy it is to start and maintain; nobody will call you lazy for having one, since tons of professionals use them!

A lazy portfolio is a bundle of long-term investments that you pick once, and simply allow to mature over years and decades with little to no intervention. Contrary to popular belief, you don’t have to be buying and selling stocks all day to make money in the stock market. In fact, buying and holding often works better, saves you time, and keeps your stress levels much lower than day trading.

You can launch a lazy portfolio using M1, an investing app geared towards mid-to-long-term investments. M1 prompts you to build “M1 Pies,” which are like bundles of bundles of bundles of investments (talk about diversification). For example, a 40% “slice” of your pie could be M1’s “responsible investing” portfolio, made up of a diverse and safe array of ETFs.

Increase Your Auto Insurance Coverage

Like a fire extinguisher, good auto insurance is something you don’t think about until you need it. Then, you’re really, really glad you have it.

As life returns to normal and businesses reopen, you might find yourself commuting again soon (if you haven’t already). For that reason, now is a good time to consider revisiting your auto insurance coverage levels, and fortifying certain areas as necessary.

One example might be your comprehensive coverage. Will your car be exposed to the elements during your upcoming policy period? Has auto-related crime risen in your area during the pandemic? These are both solid reasons to consider increasing your comprehensive coverage levels and/or reducing your deductible.

Buy Life Insurance

12 Ways To Spend Your Stimulus Check To Improve Your Finances - Buy life insurance

Stephen Colbert once asked Keanu Reeves what he thinks happens when we die. The legendary actor responded, “I know that the ones who love us will miss us.”

That’s true for all of us, and if you have family members that rely upon your income, they may suffer financially as well.

If you have dependents, e.g. relatives or children whom you support financially, you might consider taking out a life insurance policy for yourself and listing them as the beneficiaries. I know, facing your own mortality and thinking about what your family will do if you pass away is not a pleasant thought process, but once you get over the initial discomfort, purchasing a life insurance policy can bring peace to you and your loved ones.

Policies are typically sold as “term life insurance” policies, meaning you pick your total years of coverage upfront. Terms typically range from 10 to 30 years, with some providers offering increments of 5 or even more flexible terms. Plus, term life insurance is pretty cheap when you’re young and healthy.

You’ll like be able to find a super cheap rate for a term life insurance policy by visiting Policygenius. You can enter your info just once and see multiple competing rates from reputable, trustworthy companies. Plus, Policygenius isn’t just for life insurance; it’s a veritable insurance bazaar, where you can find the lowest possible rates for auto, home, disability, life, jewelry, health, even pet insurance.

Buy Pet Insurance

Another great way to protect your hard-earned money is to spend a little of your stimulus on some pet insurance. Pets, like people, have expensive medical bills; a single trip to the vet can cost $3,000 – $10,000 depending on the illness or emergency, so it pays to have your fur baby covered.

Thankfully, although the medical bills are equally horrifying, pet insurance is much cheaper than people insurance. A healthy young pet with minimal coverage may only cost around $15 to $30 per month to insure, while an older pet with pre-existing conditions may cost around $70 – $90 per month. An average pet with average coverage levels will cost around $45 monthly. 

Plus, having pet insurance can remove a lot of hidden background stress from pet ownership. As a dog owner myself, it’s no fun to think of my little mutt as a potential source of financial burden. Pet insurance eliminates that possibility, so she and I can focus on enjoying each other’s smelly company. 

Pay Off Debt

This one may seem obvious, but one of the best things you can do with your stimulus money is to pay off some of your existing debt. 

Your existing debt might include student loans, your auto loan, or even run-of-the-mill credit card debt. And even if you’re already on track to pay off these loans in a timely manner, it helps a ton to put a $1,400 ding in it for a few reasons. 

First, some of this debt may be charging you month-to-month interest. Credit cards especially are notorious for gouging debt holders with upwards of 29.99% APR, which can quickly drain your credit score and lead you further into debt. 

Second, even your lower-interest debt like your auto loan or student loans can benefit from applying your $1,400 stimulus check as an “extra payment” or two. Doing so can reduce your remaining payments but also potentially lower your interest, saving you even more. 

If your $1,400 check helps you pay off a loan early, just be sure to check your lender’s early payoff terms. Some lenders will charge you a fee or a percentage of your remaining interest if you pay off your loan early. In most cases, it’s still worth it, but you should factor in these fees nonetheless. 

Spend it

12 Ways To Spend Your Stimulus Check To Improve Your Finances - Spend it

Last but not least, spending your stimulus check can be a great way to improve your finances. I realize that sounds counterintuitive, but it’s really not. After all, the government sent out stimulus checks to stimulate the economy during this pandemic. So, if you are already set in all of the other categories, then this is likely the category for you.

Here’s just one example of how spending your stimulus check can improve your finances in the long run: if you invest in home improvements, they can help increase the value of your home. This will net you more money when you go to sell your house or if you decide to apply for a home equity loan with a company. The more equity you have built up in your home, the more opportunities you have to access that money down the road.

Lastly, spending doesn’t always have to provide a fiscal return on investment. If a purse or a PS5 will bring you more than $500 worth of joy, go for it. The purpose of money isn’t just to make it and invest it, but to spend it in ways that improve our quality of life. 

So don’t feel guilty about spending your stimulus if that’s the right move for you. Just spend it wisely, and be sure to get a good deal.


If you qualify for a stimulus check, there are so many things you could do with it. But, the best thing you can do is to use it to improve your finances. There are many different ways to go about this, and it will be different for each one of us. 

No matter which path you choose, make sure to maximize your stimulus check’s potential and think before you spend. 

Read more:

¹ You will be responsible for an origination fee of up to 4.99% of your initial draw, depending on the state in which your property is located and your credit profile. You may also be responsible for paying recording fees, which vary by county, as well as a subordination fee if you ever ask Figure to voluntarily change lien position.
*Available APRs range from 6.80% to 15.00%. The advertised APR includes a 0.25% discount for enrolling in autopay as well as the payment of a higher origination fee in exchange for a reduced interest rate, which is not available to applicants or in all states. The lowest APRs are only available to the most qualified applicants, depending on credit profile and the state where the property is located, and those who also select five year loan terms; APRs will be higher for other applicants and those who select longer loan terms. As representative example, for a borrower with a 60% CLTV and a 740 credit score who is eligible for and chooses to pay a 4.99% origination fee in exchange for a reduced APR on a five-year Figure Home Equity Line with an initial draw amount of $50,000 would have a fixed annual percentage rate (APR) of 8.21%. The total loan amount would be $52,495. Alternatively, a borrower with the same credit profile who pays a 3.99% origination fee would have an APR of 8.82% and a total loan amount of $51,995. Your actual rate will depend on many factors such as your credit, combined loan-to-value ratio, loan term, occupancy status, and whether you are eligible for and choose to pay a higher origination fee in exchange for a lower rate. Rates change frequently so your exact APR will depend on the date you apply. APRs for home equity lines of credit do not include costs other than interest. Property insurance is required as a condition of the loan and flood insurance may be required if your property is located in a flood zone.


Figure Lending LLC dba Figure. 15720 Brixham Hill Avenue, Suite 300, Charlotte, NC 28277. (888) 819-6388. NMLS ID 1717824. For licensing information go to Equal Housing Opportunity. Licensed in Alabama 22533, Alaska AK1717824, Arizona 0948458, Arkansas 114692, California: Loans are made and arranged pursuant to a Finance Lenders Law License, Licensed by the California Department of Financial Protection and Innovation under the California Finance Lenders Law (License 60DBO81967), Delaware 026994, Florida MLD1636, Georgia Residential Mortgage Licensee 61229, Idaho MBL-9625, Indiana 39933, Iowa 88893478 and 2018-0048, Kansas MC.0025537 and SL.0026703, Louisiana 1717824, Massachusetts Mortgage Lender License ML1717824, Michigan FL0021494, Mississippi 1717824, Missouri 19-2421, Montana 1717824, Nebraska 1717824, Nevada 4823, New Hampshire 22423-MB, Licensed by the N.J. Department of Banking and Insurance, New Mexico 1717824, North Carolina L-180811, North Dakota MB103310, Ohio RM.804317.000, Oklahoma ML011894, Pennsylvania 66882, South Dakota ML.05202, Tennessee 151185, Washington CL-1717824, West Virginia ML-36248, Wisconsin 1717824BA


Empower Personal Wealth, LLC (“EPW”) compensates Webpals Systems S. C LTD for new leads. Webpals Systems S. C LTD is not an investment client of Personal Capital Advisors Corporation or Empower Advisory Group, LLC.

Related Tools

About the author

Total Articles: 16
Shanah Bell is a freelance writer focusing on health and finance. As the owner of, Shanah she helps her clients learn to live their healthiest and best lives through dietary adaptation within financial constraints. Sarah has a Master's of Nutrition degree and a background in accounting.