Spend your Rebate Check

Your share of the economics stimulus package is coming to your mailbox soon. The intent of the forthcoming gift from the micro economic wizards in Washington is to spur conspicuous consumer consumption. The theory here is that consumption is off because of the fear of recession, and if we are given the gift of a tax rebate, we will dutifully go out and spend, thereby reducing inventory, creating jobs and income. Economic studies will undoubtedly show that is idea will result in marginal economic gains, at best or no economic improvement in the worst case. Notably absent from the plan are any money saving strategies.

Like most misguided micro-economic control schemes, the idea of giving consumption conscious consumers more power to consume more goods hinges on the edge of absurdity. Where do most Americans like to spend their money? Well, the largest retailer in the world is Wal-Mart, where cheap Chinese imports with a life expectancy of three days are begging to make their way into your household just before they are hauled off to the local landfill. As if Wal-Mart and China need anymore of our money or our environment needs any more toxins. There has to be a better way to contribute to the economy, and you might consider the merit of the following ideas.

Here are nine ideas for using your economic stimulus rebate check. Some of these are obvious and some may be not so obvious. The idea is stimulate your thinking about how you can make the government’s charitable donation to work for you in ways other than improving the bottom line of a foreign economy.

1. Make a payment towards your credit card debt. The degree to which your credit rating is teetering on the brink of disaster could be improved in your favor with some on-time payments for a change. An improved credit rating would be beneficial for most everyone in our debt burdened nation. In tough times like these, a good TRW credit score is going to become very important.

2. Homeowners could use the funds to pay their property taxes. Property taxes are another burden that drags the economy down yet they are essential for efficient government services. The money goes back to the government which eventually makes its way back into the paycheck of a fireman, policeman, or a snow truck driver. We need them all, and they are underpaid for their services.

3. Insurance of any form is also a necessary burden that merits payment. Health insurance premiums are troublesome, auto insurance premiums are a necessary evil, and homeowner insurance just keeps going up. Maybe you could get ahead of the game if you sacrifice your money to the insurance industry. If you are unfortunate and suffer a loss, you just might get it back.

4. If you are a homeowner, you could make an additional mortgage payment this year. This reduces the principal and improves the equity in your home. Your mortgage could be paid off earlier and your return in investment will be greater, assuming that you wait long enough for the housing market’s recession to reverse itself.

5. Think about using this unearned gift for paying next year’s, or perhaps this year’s, income taxes. Essentially you give it back to the government, which you are obliged to do anyway. Easy come, easy go.

6. You could place the funds in your trusty savings account, buy a savings bond, a CD or some other savings instrument. Much patience is required as any meaningful interest is nearly nonexistent these days due to inflation and taxes. Budgeting for savings can also improve your TRW credit score.

7. Donate it to your favorite charity. You can write the donation off and pretend it never happened. Charities do important social work and the social climate in our nation improves. Everyone wins, including the government which doesn’t have to provide as many services.

8. Place the money into an educational investment account of some sort for your children or grandchildren. They are the people that are really going to need the money someday. Investing in their future is the greatest gift we can give, and they’re going to need all the help they can get.

9. Plant a tree or anything green that will help mitigate the looming disaster of global warming and provide food.

Perhaps some day we won’t be trillions of dollars in debt, wondering what happened to our children’s future. Until that day comes, and government can live within its budgets, we should be thinking about the saving and preserving the precious economic resources of our nation, not consuming disposable commodities based upon a questionable economic theory.