Not all of the stimulus check has to go to one purpose, according to Sun, who said she likes the idea of putting some of it towards emergency savings and some toward retirement savings.
Ideally, that retirement money could go into a Roth individual retirement account, she said, which can also serve as a backup emergency savings. Of note, Roth IRAs come with some rules. You have to meet certain income thresholds in order to invest in one of these accounts. Certain qualified penalty-free withdrawals can only be made after five years.
Of course, you may be tempted to do something more extravagant with the money — say, buy a new pair of skis or invest in a favorite company’s stock.
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For retail items on your wish list, you may want to put aside a portion of the stimulus check and then wait for a good deal, Sun said.
Rather than buying individual stocks, it would be preferable to instead focus on your retirement savings or your children’s college savings, she said.
“I do think it would be a mistake to buy individual stocks with it, because the amount’s not that large,” Sun said.
Another great way to invest the money that will reap returns: Invest in yourself, whether it be an online course, book or even a new tool like a webcam, Sun suggests.
“That’s definitely a smart way to use this money,” Sun said.
Source Article from https://www.cnbc.com/2020/12/17/second-stimulus-checks-what-advisors-say-you-should-do-with-the-money.html
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