The federal government sent out stimulus checks for $1200 as a result of the coronavirus pandemic and economic turmoil. The last time the government sent a stimulus check was in 2008, during the last recession. Inflation has gone up by 9% since 2008, which means that a $1200 check is now worth $1086.87. Those who spent their stimulus checks on rent, food, and other essentials will feel the most difference due to inflation.
The federal government sent out stimulus checks for $1200 as a result of the coronavirus pandemic and economic turmoil. This wasn’t the first time that stimulus checks were sent out. The government also sent out stimulus checks in 2008 to help people during the recession.
Inflation is a measurement of the rate at which prices are rising. It’s measured by the Consumer Price Index (CPI), which tracks the price changes of a basket of goods and services that a typical consumer might buy. The CPI is calculated over a specific period, usually one year. In this case, we’re using 2008 as our reference point—the start year for our stimulus check calculations—because it was when the recession started and therefore provides a baseline for comparison with other years’ inflation rates.
Stimulus Check inflation Money
The benefits of the stimulus check are immediate, but inflation is a long-term effect. Inflation is when the price of goods and services goes up. In 2008, inflation was 2%. That means that if you bought something for $100 then, it would cost you $102 in 2019 to purchase the same thing. In other words, prices have gone up by 2% per year over 8 years!
Since your stimulus check is being spent on rent, food and other essentials for your household now (which were already expensive back in 2008), those who spent their stimulus checks on these items will feel the most difference due to inflation.