Families of young adults can get hundreds of dollars
The child tax credit — beefed up for 2021 to include a series of cash payments, under the massive pandemic rescue bill President Joe Biden signed in March — is typically available only if you have kids 17 and younger.
But a one-time payment of $500, which can be taken as a tax refund, is available for familes of children ages 18 to 24.
The IRS has laid out a few eligibility conditions:
- A child who's 18 years old must be claimed as a dependent.
- Children 19 to 24 must be attending college full time.
- Each child must have a Social Security number.
The income limits associated with the expanded child credit are in effect for these payments, too. The money starts phasing out if you earn more than $75,000 as a single tax filer or $150,000 if you're a married couple that files jointly. For head-of-household filers, the income threshold is $112,500.
Even if you don’t normally file taxes, you can still apply for the $500 credit using the IRS child tax credit non-filer sign-up tool.
Other ways to boost your budget
If your family isn’t eligible for the child tax credit money or the special $500 payment for young adult children, there are other ways you can carve out a little more financial breathing room.
Refinance your mortgage. If you've got a mortgage and haven't refinanced in the past year, you could be leaving a lot of money on the table. Nearly half the homeowners who took advantage of the pandemic's historically low mortgage rates are now saving $300 or more a month, according to a recent Zillow survey. Thirty-year mortgage rates are still under 3%, so compare today’s refinance offers and see how much you could save.
Draw down your debt. Carrying multiple high-interest debts, like credit card balances, can make it hard to get ahead financially. It’s a problem you can address by folding your balances into a single, lower-interest debt consolidation loan. You’ll reduce the overall cost of your debt — and pay it off faster.
Cut insurance costs. When was the last time you checked to see if you might be overpaying for car insurance? A little comparison shopping could help you find a much cheaper policy. The same strategy can help you save on homeowners insurance, too.
Put your pennies into a portfolio. You don’t need much extra cash to start earning extra money in the stock market. A popular app allows you to build a diversified portfolio using little more than "spare change" from your everyday purchases.