What can you do with $13 extra a week?
On Friday the 13th of February both the House and the Senate passed a new $789 billion stimulus package as a continuation of the efforts by the United States Government to jumpstart the economy. A significant portion of the package gives a tax cut of $400 to each individual worker and $800 to a couple starting in June 2009. This works out to a paltry $13 per week for individuals making $75,000 or under per year and couples making $150,000 or under per year. How will you stimulate the economy with $13 a week?
When the Bush administration gave out a $600 stimulus last year, Michelle Obama said that it "doesn't pay down every bill every month", and that "it may even feel good that first month when you get that check. And then you go out and you buy a pair of earrings". So I guess if the First Lady qualified for this tax cut she could buy about 24 pairs of $13 earrings this year.
Personally, I would apply the extra money towards my mortgage since my mortgage is fairly new and any added principal cuts down future interest significantly, but this is not the right thing to do for everyone. For those with high interest credit card debt this money is probably best applied there. However, paying off debt does not "stimulate" the economy.
In 2010, the stimulus starts in the beginning of the year so you will be stimulated by approximately an extra $7.70 a week. Eventually all of this money has to be paid back by the U.S. Government to its bond holders, and the U.S. Government's source of revenue is its tax payers. So the $7.70 a week I am getting may equate to hundreds to thousands of extra taxes in the future. So perhaps the best thing to do is to invest this extra money now to pay for taxes in the future?
As a final thought, I just turned in a bunch of cans and bottles at the recycling center and got $8.57 and then I bought two pounds of potato salad at the supermarket next door and still had some money left over. I am sure a lot of people are able to turn in enough cans per week to make $7.70 to $13 so perhaps a more green and less debt-laden plan is to encourage people to recycle? What do you think?