According to a recent Deutsche Bank survey, half of online investors polled between 25 and 34 years old are planning to spend at least half of their latest stimulus check with the stock market.
"I'm excited that some people are thinking, 'hey if I don't need it, let me see if I can do something productive with it,'" certified financial planner Michael Macco said.
Macco feels strongly that the stimulus should cover a "triage" of expenses before long-term investments: rent, other bills, and even getting ahead on those expenses and cushioning savings accounts. However, trendy retail trades may be influencing people to put their checks elsewhere.
"The fear of missing out and what that can create sometimes with investors is maybe not the best decision making," Macco said. "Putting all of your money in to one company's stock is usually not the best idea no matter where that money comes from, whether it's an inheritance or the federal government via COVID stimulus check."
Macco says that investors who don't wish to handle the daily research and labor of individual trades should consider trusting a professional to build a diverse portfolio with risk averse priorities.
"Its not very sexy to put your money in an asset allocation mutual fund or something, but its probably what most people ought to be doing," Macco said.
