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Is there a fourth stimulus check on the horizon for Americans?

Is there a fourth stimulus check on the horizon for Americans?
(Image credit: Getty)

Questions over the possibility of a fourth stimulus check have been inevitable ever since the ink dried on President Joe Biden’s approval of stimulus check 3 (opens in new tab). Indeed, distribution of the third wave of relief payments hasn’t even been completed by the IRS, and yet the pressure for a stimulus check 4 is already being forcefully applied by some. So is there a fourth stimulus check lined up by the Federal Government and is it really needed? 

The arguments for a fourth stimulus check

With the pandemic resulting in record job losses and drastically reduced household incomes nationwide, the case for a fourth stimulus check, particularly for those hardest hit, is relatively easy to make. 

According to the latest U.S. Census Bureau data (opens in new tab), around 30% of Americans couldn’t cover all their household expenses during March, and reported that they had needed to use credit cards, take out loans (opens in new tab) and been borrowing from family and friends to pay for food, housing and gas costs.

Backing these findings up, a Bankrate survey found that 45% of Americans were using their third stimulus check to pay monthly bills (opens in new tab), 36% were spending it on daily essentials, and 32% were using it to pay off debt, including personal and auto loans (opens in new tab)

And illustrating more specifically the benefits that a stimulus check 4 could have on those struggling the most, the Tax Policy Center at the Urban Institute and Brookings Institution found (opens in new tab) that a fourth stimulus check of $1,400 would help lift some 7.3 million people out of poverty if it was to get the go-ahead. 

Is there a fourth stimulus check on the horizon for Americans?

(Image credit: Getty)

Will there be a fourth stimulus check?

Despite the strength of evidence of the good that a fourth stimulus check could deliver, the uncomfortable news for now is that another wave of relief payments is not currently on the cards. 

However, that’s not to say stimulus check 4 won’t happen in the future, particularly if recent pressure from advocates and interested Democrats is sustained. Indeed, before President Biden signed the American Rescue Plan that delivered stimulus payment 3, dozens of congressional lawmakers were calling for recurring stimulus checks to be paid until the effects of the pandemic subside.

“One more check is not enough," the group wrote in a letter (opens in new tab) in January. “Many families cannot afford to wait for 8 months between payments. We need to provide those struggling and left behind with consistent reliable cash payments during this COVID-19 crisis.”

At the end of March, the sentiment was echoed (opens in new tab) by a group of 21 Senate Democrats too. For now, however, the President has made no suggestion he would support a fourth stimulus check and instead remains focused on a plan to boost infrastructure (opens in new tab). And even if Biden did come round to the idea, the rising number of people finding work, the relaxation of coronavirus restrictions and the progress of the vaccination roll out would make a smooth passage through Congress far from likely. 

Is there a fourth stimulus check on the horizon for Americans?

(Image credit: Getty)

What to do instead of a fourth stimulus check

If your finances are stretched, and the lack of a fourth stimulus check is hurting you, there may be certain things you can do to ease the strain:

Lower the cost of your debt
If your credit card has been supporting your spending more than it normally would, it’s vital to at least make the minimum payment each month and to pay off more if you can. Interest-free periods also provide leeway, but if these are coming to an end, or you’re racking up interest already, definitely consider a balance transfer card or perhaps a debt consolidation (opens in new tab) loan, which should make things easier to manage and could lower your interest rate. 

Trim your insurance costs
Lockdowns and remote working means car use has reduced dramatically this past year, leading some of the best auto insurance (opens in new tab) companies to offer discounts and refund customers some of their premiums. If you’re spending more time at home, you may find your home owners insurance (opens in new tab) will come in slightly cheaper than if you were leaving it unoccupied for long periods of time. Shopping around for both is key. 

Time to refinance
If you have a mortgage, but not checked out the interest rates in the past year, there’s a good chance you could save big money (opens in new tab) - or knock time off your repayment term - by refinancing. Even though mortgage rates have edged higher since the turn of the year, they remain extremely low on a historical basis, meaning if you approach the best refinance mortgage companies (opens in new tab), some great home loan deals can still be found. 

Save and invest
If you’ve just had your annual battle with your tax software (opens in new tab), and a tax refund is on the way, if you don’t need the funds urgently elsewhere, consider saving some of what you receive, or perhaps investing it via online stock trading (opens in new tab) to see if you can make it grow. There’s no guarantees of success with investing, but if you’re patient, and in it for the long-term, you stand a better chance of securing a decent return. 

With over 20 years’ experience in the financial services industry, Tim has spent most of his career working for a financial data firm, where he was Online Editor of the consumer-facing Moneyfacts site, and regularly penned articles for the financial advice publication Investment Life and Pensions Moneyfacts. As a result, he has an excellent knowledge of almost areas of personal finance and, in particular, the retirement, investment, protection, mortgage and savings sectors.