How does the math work on $14,000?

Family saving money to piggy bank
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Consider the Smiths, a hypothetical family of four with two adults and two children, 7 and 10. Provided they met the income criteria for stimulus checks, the Smiths would have received $2,400 in January from the second round of payments: $600 for each adult and each of the kids.

If Congress passes the current aid bill and Biden signs it, the family would get another $1,400 per person, for a total of $5,600. Add that to the $2,400 from earlier in the year, and you get a total of $8,000 in stimulus checks for the household.

Another part of the president's COVID rescue package boosts the child tax credit to give low- and moderate-income families $3,000 for each child between the ages of 6 and 17 for 2021. Half that money would be paid out in monthly installments (a different kind of "stimulus check") during the second half of the year.

So, the Smiths would receive an additional $6,000 for the kids — for a grand total of $14,000 in government relief this year.

Some households stand to get even more than that, notes a report from the financial services firm Raymond James.

How do you collect more than $14K?

Families with children younger than 6 can expect to receive credits of $3,600 per child instead of $3,000.

So let’s say you're parents who qualify for stimulus checks and have two children ages 3 and 5. Over the year, your child tax credit total would be $7,200 — bringing your haul from Uncle Sam this year to a whopping $15,200.

There's even more money if you're among the millions who've been thrown out of work during the pandemic.

The federal government has been paying bonus unemployment benefits, on top of the usual state benefits. The current $300-a-week payments are due to run out soon; the relief bill would raise those federal benefits to $400 a week and extend them through August.

Given all of the various types of federal COVID aid offered to families and individuals this year, "the U.S. consumer will largely be in the best financial position they have been in, on average, for at least 40 years (likely ever)," writes Raymond James analyst Tavis McCourt.

But McCourt adds that while the stream of cash increases the chances for economic recovery, it threatens to increase inflation in the short term.

What if you won’t qualify for $14,000?

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Just this week, Biden agreed to a compromise with more conservative Democratic senators that would target the stimulus checks and impose new income limits. Households with incomes above $160,000 (or $80,000 for single earners) will miss out on the third round of direct payments completely.

If your household won't qualify for the stimulus checks or the child credit, and you need more cash yesterday, here are a few things you can do:

  • Cut the cost of your debt. Credit is convenient, but interest is a killer. If you’re piling up lots of expensive interest these days, there’s a better option. Make your debt easier to carry — and unload sooner — by folding your balances into a single debt consolidation loan at lower interest.
  • Slash your insurance bills. Car insurance companies have been handing out discounts to drivers sticking close to home through the pandemic. If your insurer won’t budge, then maybe it’s time to shop around for a better deal. And while you’re looking, you could save hundreds on your homeowners insurance by comparing rates to find a lower price.
  • Reduce your mortgage payments by refinancing your mortgage. If you haven’t looked around for a lower interest rate on your home loan in the last year, what are you waiting for? Rates remain historically low, and refinancing your existing mortgage could slash your monthly payment.
  • Trim your budget and "make your own" stimulus check. By finding a few creative ways to cut back, you might rearrange your budget to find another $1,400. Cut your cable service or any monthly entertainment subscriptions you’re not using. Have a hobby or special talent? Turn it into a side hustle to bring in extra income. And, download a free browser extension that will automatically hunt for better prices and coupons whenever you shop online.

About the Author

Sigrid Forberg

Sigrid Forberg

Staff Writer

Sigrid is a staff writer with MoneyWise. A graduate of Carleton University's journalism program, she spent the better part of the last six years writing about business and retail. In her spare time, she enjoys reading, baking and riding her bicycle.

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