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Economist advises the best thing you can do when you get your stimulus check is to hold onto it

Coronavirus pandemic has cost countless jobs, so it's important to be smart with your money

MEMPHIS, Tennessee —

In the coming weeks, the government will be giving out coronavirus stimulus checks based on your previous year's income. You'll receive $1,200 if you made under $75,000, couples will receive up to $2,400 plus $500 for each child claimed as a dependent. Those who made more than $75,000 will lose $5 for each $100 made past $75,000 and those who made more than $99,000 will not receive anything.

University of Memphis economics professor Dr. John Gnuschke said the smartest thing to do is hold onto it until you absolutely need it.

"It’s an attempt to address the immediate loss of income for a lot of households in America," Gnuschke said.

While saving your stimulus check seems like the opposite of its purpose, Gnuschke said it'll just delay the stimulation of the economy. It'll take a few rounds of these checks to see a major difference.

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“We’ll have to have multiple levels of stimulus that reflect the losses that are going to be occurring for most households," Gnuschke said.

He predicts this is only the beginning of the economic hardship.

"The virus has been devastating for the local economy, and unfortunately it’s going to get worse before it gets better," Gnuschke said.

Gnuschke said the way businesses can survive this is only how well their finance records have been in the past. Envision Memphis is a small gym based in downtown Memphis. Owner Mark Akin said he's blessed to have a strong client base he's able to train virtually. He said the stimulus check will help some, but his business is staying afloat because he and his business partner have been frugal with their money.

"It helps of course," Akin said. "Grateful for every dollar we can get, but we’re having to get creative and think outside the box and keep revenue coming in."

Akin knows small businesses are a large part of Memphis' economy. His advice to other small business owners is that they'll get through this together.

"Do everything you can to keep your head up, please don’t lose faith, please believe there’s going to be light at the end of the tunnel and, when that light finally gets here, then we will be able to continue to do what we love," Akin said.

Unemployment numbers come out Friday. Many economists predict the unemployment rate could be higher than what it was during the Great Depression.