Four things to consider doing with the economic impact payment you receive from the federal government.
The recent economic downturn due to COVID-19 has led to unemployment rates rising, businesses closing and consumer spending dropping. While this is an unfortunate reality, the Economic Impact Payments that many Americans have been receiving as a result of the $2 trillion Coronavirus Aid, Relief, and Economic Security (CARES) Act attempt to help offset the negative financial impacts of this unprecedented crisis.
If you're among those who have received or will receive a payment, you may be wondering what to do with the money. While the answer will vary depending on your individual circumstances and needs, following are some possibilities for you to consider. 1. Pay Off Debt 2. Start or Add to an Emergency Savings If this pandemic has taught us anything, it's that the unexpected can hit at any moment. That's why it's important to have enough savings to cover at least three months of living expenses in case of medical, financial or other emergencies. If you already have an emergency fund but think it could use a boost, consider using a portion of your payment to supplement your savings. If you don't, here's one way to put together an emergency fund. 3. Build Your Retirement Savings While it's important to pay off debts and build an emergency fund, it's also crucial to save for your future. If you received a $1,200 payment like many taxpayers, don't forget about your long-term retirement savings goals—regardless of whether you can sock away 10% ($120), 25% ($300), 50% ($600) or all of it. While the markets are turbulent right now, keep in mind that, historically, they have bounced back from short-term declines over time.* 4. Donate If you have some money left after taking care of your expenses and savings, consider donating to a cause that's important to you. So many organizations have stepped up during this difficult period and helped the communities they serve. Visit usa.gov to learn more about donating to charities. To learn more, please contact your local Mutual of America representative today. *Past performance is no guarantee of future results.You should consider the investment objectives, risks, and charges and expenses of the variable annuity contract and the underlying investment funds carefully before investing. This and other information is contained in the contract prospectus or brochure and underlying funds prospectuses and summary prospectuses, which can be obtained by calling 1-800-468-3785 or visiting mutualofamerica.com. Read them carefully before investing.Mutual of America's group and individual retirement products are variable annuity contracts and are suitable for long-term investing, particularly for retirement savings. The value of a variable annuity contract will fluctuate depending on the performance of the Separate Account investment options you choose. Upon redemption, you could receive more or less than the principal amount invested. A variable annuity contract provides no additional tax-deferred treatment of benefits beyond the treatment provided to any qualified retirement plan or IRA by applicable tax law. You should consider a variable annuity contract's other features before making a decision.