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What Are the Best Uses For Your $1200 Stimulus Check?

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With the passage of the $2 trillion economic relief package, millions of Americans will receive a paycheck of $1,200. 

So, if you're wondering how to put the money to work--besides for using it in place of a paycheck or to pay off rent--Ellevest CEO Sallie Krawcheck has some ideas.

Watch the video above for more.

And watch the full interview with Krawcheck here: How to Handle Market Volatility, Manage Personal Finances During the Coronavirus Pandemic

Video Transcript:

Millions of Americans are expecting to get this $1200 paycheck, one time paycheck, in their bank accounts. What do you advise these Americans to do with that? Should they put it to work in the market? Should they put it in their savings account?

Yeah, I think it really depends on individual circumstances. For some people, they're going to need that to pay their bills, they just are, and so that goes to that. For some people who haven't built a three to six month emergency fund, now you're realizing that, oh, this is why we do that. For some people it's going to be paying off credit card debt. I'm always surprised, frankly, by how many people who you think, boy, he or she has got it together. They're investing, they've got a great job, and then you find out they have X amount of money in credit card debt, and so for some people it's going to be that and it's really taking those things in order. Do I wish everybody would take it and invest? Sure. But everyone doesn't have the luxury of that.

And again, I think for those who do, if history is any guide, when you invest in a diversified investment portfolio and we're on the other side of this, which we will be, I think they're going to be a lot of people saying, "Remember that 1200 bucks? Well, guess what it's worth now?" And in fact, to go back to a statistic that every time I say it, it's so mind boggling, "If you had invested $1000 in 1900 and left it and allowed it to compound." And over that period of time we had the Flu Pandemic of 1917, we had two world Wars, we had the Great Depression, we had the Great Recession, we had terrorist attacks on U.S. shores, we had the Cold War, we had Vietnam, we had Korea, we had inflation, we had stagflation, oh my gosh, so many bad things happened.

Wow, what's that $1000 going to be worth? And I think most people would be like, "No, $10,000, I think." The answer is $57 million. Because of the power over time of having that money invested and allowing it to compound and earn returns on the returns and returns on the returns on the returns, and so on over time. Never underestimate the resilience of the U.S. economy, of U.S entrepreneurialism, of capitalism to figure these things out. Maybe everything isn't perfect about capitalism, but if you are able to invest and hold and compound, the returns to it over time have been extraordinary.

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