The second stimulus check has now been distributed by the U.S. Government. Households received $600 to help them cover the financial damage/losses throughout the coronavirus pandemic.
The amount of this second stimulus check is significantly lower than the first round distributed towards the start of the pandemic in March 2020 – these being $1,200.
Households are only eligible for this financial support if their income is $75,000 or under a year. For joint couple income households, this income limit is raised to $150,000 a year. Those receiving the stimulus check get $600 and a further $600 for children under 17 years old.
What the Industry Says
Those in the finance and loans industry have raised concerns regarding the effectiveness of these stimulus checks, U.S. Lender Pheabs’ Dan Kettle (founder) commenting the following on the matter:
“Receiving a one-off payment of $1,200 or $600 is useful and will certainly help some households, but it falls well below the national monthly average wage of Americans which is around $2,500.”
“When calculating the loss of income for millions of Americans, the injection of $600 will probably not make much of a difference and it still gives money to people who are working and earning as normal. It could be argued that regular employees do not need this income and it should go to those that need it most.”
“A large proportion of Americans will struggle to claim their stimulus checks and resort to things like payday loans, borrowing from friends or selling their homes or cars to get by – at least until the economy picks up again.”
How Does the U.S. Stimulus Check Compare to Support in Other Countries?
The stimulus check can be seen as comparatively low compared to the financial aid given in such countries as the U.K – where a number of working Brits were granted 80% of their typical monthly wage via the furlough scheme.
Through the furlough scheme, employers were able to grant selected employees furlough. These selected employees were expected not to work throughout the period they were on furlough, offered 80% of their monthly wage to do this.
Although the U.K.’s furlough system has been praised by some, providing employees and businesses effective support throughout this turbulent period in time – especially useful for those in the events, hospitality and travel industries – others have taken a more critical perspective on this.
Some view the U.K.’s furlough scheme as being ‘too generous’, offering employees a significant chunk of their normal wage essentially for doing nothing.
Pheab’s Kettle comments that “The UK version is not perfect” however, “for a lot of individuals and businesses, the amounts are so large that they will not negatively affect their financial positions.”
“There will be some people who have fallen on hard times, but generally people should more or less be able to stay on top of their finances. Especially, if you are receiving 80% of your wage, but do not have to pay for travel, dry cleaning or things like office socials.”