Coronavirus stimulus package: How not to spend your $750 bonus
For many low-income earners and retirees, the Australian government’s $17.6 billion coronavirus (COVID-19) stimulus package could mean a bit of financial relief to help cover expenses, from groceries to the electricity bill.
More than 6 million Australians who rely on Centrelink benefits will receive a $750 payment under the stimulus package, set to hit their bank accounts from March 31.
The one-off, tax-free payment aims to encourage more households to open up their wallets and support businesses struggling to keep afloat amid coronavirus panic. It comes in light of fears that the pandemic could leave Australia’s economy in dire straits, as consumers pull back on spending and adopt a hoarding mentality.
“Our plan will back Australian households with a stimulus payment to boost growth, bolster domestic confidence and consumption, reduce cash flow pressures for businesses and support new investments to lift productivity,” said Prime Minister, Scott Morrison.
RELATED ARTICLE: What the coronavirus stimulus package will mean for Aussie small businesses
What not to do with your stimulus payment
The question then is how to wisely spend the $750 bonus. As tempting as splurging or comfort spending may be, those extra dollars are a great opportunity for you to whip your finances into better shape.
To get the ball rolling, here are four things to avoid doing, so you can make the most of your stimulus payment:
1. Don’t leave the money be
Although $750 may seem like a hefty amount, if all you do is leave it inside your bank account, you’ll be surprised at how quickly it disappears after a few purchases here and there.
That’s why having a spending strategy in place is super important, like adding the $750 to your budget and mapping out exactly what you’ll do with the money.
If you’re not sure how you’ll spend the bonus just yet, move it into a high interest savings account. With a savings account you can earn interest on your bonus, plus there’s less temptation to ‘dip’ into your funds.
Compare high interest savings accounts
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Mozo experts choice awards won:
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Savings Maximiser
5.50% p.a. (for $0 to $100,000)
0.55% p.a.(for $0 and over)
Yes up to $250,000
Deposit $1,000 into a personal ING account, make 5 eligible transactions with a linked Orange Everyday account and grow the balance each month.
Great variable rate every month when you grow your balance each month in addition to other eligibility criteria. No ING fees to pay. Save even more with ING Everyday Round Up. Mozo Experts Choice Awards Everyday & Savings Bank of the Year winner for 2024.^
CompareCompareSavings Maximiser
Great variable rate every month when you grow your balance each month in addition to other eligibility criteria. No ING fees to pay. Save even more with ING Everyday Round Up. Mozo Experts Choice Awards Everyday & Savings Bank of the Year winner for 2024.^
- Maximum rate
- 5.50% p.a. (for $0 to $100,000)
- standard interest rate
- 0.55% p.a.(for $0 and over)
- Govt Deposit Guarantee
- Yes up to $250,000
- account fee per month
- $0.00
- Maximum rate conditions
- For customers who deposit $1000 from an external source into a personal ING account (excluding Orange One and Living Super), make 5 eligible transactions and grow their nominated Savings Maximiser account each month so there is more in the account at the end of the month than there was at the start of each month (excluding interest). The total bonus interest rate is available on balances up to $100,000 on one Savings Maximiser the next month after meeting eligibility.
- Access
- Phone banking, Internet banking
- Minimum balance
- $0.00
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Bonus Saver
5.00% p.a. (for $0 and over)
0.50% p.a.(for $0 and over)
Yes up to $250,000
Bonus interest for the first four months from the account opened date. No minimum balance required. No monthly or ongoing fees or withdrawal penalties. Manage your money easily via phone or online banking or via the BCU Bank app.
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Bonus interest for the first four months from the account opened date. No minimum balance required. No monthly or ongoing fees or withdrawal penalties. Manage your money easily via phone or online banking or via the BCU Bank app.
- Maximum rate
- 5.00% p.a. (for $0 and over)
- standard interest rate
- 0.50% p.a.(for $0 and over)
- Govt Deposit Guarantee
- Yes up to $250,000
- account fee per month
- $0.00
- Maximum rate conditions
- Bonus rate for the first 4 months from account opening.
- Access
- BPay, Branch access, Internet banking
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Bonus Saver Account
5.00% p.a. (for $0 to $250,000)
0.05% p.a.(for $0 and over)
Yes up to $250,000
Deposit at least $20 each month and make 5 Visa Debit transactions with a linked Glide account.
Open a Bonus Saver Account in under 5 minutes. There are no fees to pay or penalties for withdrawing money. Get a seamless personalised insights and online statements via the My State Bank app.
CompareCompareBonus Saver Account
Open a Bonus Saver Account in under 5 minutes. There are no fees to pay or penalties for withdrawing money. Get a seamless personalised insights and online statements via the My State Bank app.
- Maximum rate
- 5.00% p.a. (for $0 to $250,000)
- standard interest rate
- 0.05% p.a.(for $0 and over)
- Govt Deposit Guarantee
- Yes up to $250,000
- account fee per month
- $0.00
- Maximum rate conditions
- Bonus rate when at least $20 is deposited each month and five Visa Debit transactions are made each month using linked Glide transaction account.
- Access
- Internet banking
- Minimum balance
- $0.00
- Other restrictions
- Must link to a transaction account
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MoneyMAX Account
No Current Offer
4.70% p.a.(for $1 and over)
Yes up to $250,000
Unlimited access 24/7 via Banking App, Phone & Internet Banking. Interest is calculated daily and paid monthly. No transaction fees or monthly service fees. No minimum balance or withdrawal restrictions. Online access only.
CompareCompareMoneyMAX Account
Unlimited access 24/7 via Banking App, Phone & Internet Banking. Interest is calculated daily and paid monthly. No transaction fees or monthly service fees. No minimum balance or withdrawal restrictions. Online access only.
- Maximum rate
- No Current Offer
- standard interest rate
- 4.70% p.a.(for $1 and over)
- Govt Deposit Guarantee
- Yes up to $250,000
- account fee per month
- $0.00
- Maximum rate conditions
- n/a
- Access
- BPay, Internet banking
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- $0.00
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Read reviews and learn more about Unity Bank savings accounts
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Smart Saver Account
4.50% p.a. (for $0 and over)
0.05% p.a.(for $0 and over)
Yes up to $250,000
Increase account balance by any amount and make no more than two withdrawals
Work towards your savings goals with this account. Earn bonus interest when you grow your balance and make no more than 2 withdrawals each month. Earn a guaranteed standard rate of interest each month on your savings. No monthly account keeping fees to pay. Use the app or internet banking to manage your account 24/7.
CompareCompareSmart Saver Account
Work towards your savings goals with this account. Earn bonus interest when you grow your balance and make no more than 2 withdrawals each month. Earn a guaranteed standard rate of interest each month on your savings. No monthly account keeping fees to pay. Use the app or internet banking to manage your account 24/7.
- Maximum rate
- 4.50% p.a. (for $0 and over)
- standard interest rate
- 0.05% p.a.(for $0 and over)
- Govt Deposit Guarantee
- Yes up to $250,000
- account fee per month
- $0.00
- Maximum rate conditions
- Increase account balance by any amount (excluding interest) and make no more than two withdrawals in the month
- Access
- BPay, Branch access, Internet banking
- Minimum balance
- $0.00
- Other restrictions
- -
Read reviews and learn more about Newcastle Permanent savings accounts
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Or if you plan on keeping some of the money in an everyday bank account, make sure you've picked one with no pesky monthly account-keeping fees.
RELATED ARTICLE: Suncorp ditches account keeping fees on ALL deposit accounts
2. Don’t buy at first sight
From a $4 coffee to a new pair of sneakers, it can be easy to throw money down the drain for the things you love or crave. But spending your stimulus payment recklessly won’t do much to help you out of a financial rut.
That’s why when deciding what to spend the $750 on, separate what you want (e.g. eating out, entertainment) from what you need (e.g. groceries, energy bill) - and channel the extra funds into the latter category.
With essential expenses, it also pays to shop around. For instance, think about switching to a better value electricity plan or taking out cheaper car insurance.
3. Don’t continue the debt cycle
If you’ve got credit card debt under your belt, paying it off with the help of the stimulus bonus is a good idea. Just be careful that you don’t undo your efforts by whipping out your plastic again the following month, whether to pay your rent or transport fares.
A way around this is to put a portion of the payment towards your emergency fund. That way, you have a safety net in case something goes wrong and won’t have to resort to using your credit card.
4. Don’t gamble it away
It may surprise you that as many as 33% of Australians try to earn back enough money to clear their debt, by gambling or entering the lottery.
But taking your chances at the casino is certainly not the money savvy way to spend your stimulus bonus - for one, there’s no guaranteed rate of return, plus your odds of winning are incredibly low.
If you’re looking for a place to keep your money while also earning guaranteed interest, start your search with our savings accounts comparison page.
Or if you want to hop onto a fee-free bank account, then check out your options over at our bank accounts comparison page.
^See information about the Mozo Experts Choice Savings Account Awards
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