12 Ways to Use Your Child Tax Credit that Can Actually Improve Your Life

Many people are receiving the Advance Child Tax Credit Payments from the IRS, which are an advance payment on the money that you would normally be getting in your 2021 Tax Refund. The stated intention of the payments was to provide ‘relief for working families‘.

However, this is not free money. It is part of your Tax Return for 2021. Be careful because you could end up owing taxes if you take the money now, but then make too much and don’t have enough credits and deductions to offset the taxes.

If you had a very small refund last year or owed money, then you should probably not spend any of your Advance Credit because you may need it to pay your taxes in 2021.

President Biden claims that he has ‘lifted millions out of poverty‘ with his American Rescue Plan, which included an increase in the Advance Child Tax Credits and Covid checks. However, that statement will only be true if people use the money wisely. If people waste the money on junk food, lottery tickets, alcohol, phones, or trendy clothing, poverty will not be improved.

Smart people will be very careful not to waste this money! Think LONG TERM investment, not short-term pleasure.

The most important thing to do is to put some money into a savings account for emergencies. But if you are receiving a large deposit, you could save some and spend some in the following ways to help improve your financial situation.

Here are 12 ways you can put your Advance Child Tax Credit to good use.

  1. Buy healthy food and vitamins. People in poverty often do not buy the best food. Organic fruits and vegetables, quality meats, and fresh eggs are important to a well-functioning brain. Good health will allow you to think better, work harder and improve your life.
  2. Pay off high-interest loans such as payday loans, title loans, pawn shop tickets, and car loans. Getting out of debt will do more for you than you think! Being in debt sets a bad example for your children, as well.
  3. Take care of car and home repairs. Having a reliable vehicle and a safe and well-maintained home is important to your child’s future. Replace broken appliances so you can cook meals at home instead of eating out or buying deli food.
  4. Replace old mattresses, pillows, and blankets. Having a comfortable place to sleep is important to your health. Mites and mold in old bedding cause allergies and poor sleep. Having a nice bed will improve your and your child’s outlook on life!
  5. Buy books about how to make money, start a business, invest, and get out of debt. Better yet, borrow them from the library, but make sure they are current. Financial education will help you get out of poverty!
  6. Purchase tools and lawn equipment that you or your child could use to make money or start a business. These items are assets that will help you increase your future income!
  7. Buy nice clothes/shoes that can be used for job interviews or work. Wearing professional clothing is very important for making a good impression and it also improves your self-confidence during the interview!
  8. Take your children on field trips to museums, parks, the beach, the zoo, landmarks, to visit relatives, and other places to enrich their education. This is something that middle-class parents do, but people in poverty often can’t afford. Expanding their perspective will help them see that they can get out of poverty.
  9. Buy your child running shoes, sports equipment, gym memberships and proper workout clothing so they can improve their health and self-image. And your own!
  10. Put together supplies for emergencies, such as batteries, a generator, flashlights, warm blankets, plastic for windows, and food. There is no doubt that you will need this stuff eventually. Buy while it’s available and the price is not inflated.
  11. Musical instruments, art supplies and lessons. Children whose talents are supported will often have better opportunities in the future. Lessons are also available online.
  12. Other classes, educational experiences and books on topics that can increase your child’s intelligence and job skills, such as coding classes, foreign language, cooking or anything job-related.

Lastly, be very skeptical of investment schemes such as jobs that require you to pay for a kit or book or secret information that promises to make you rich. The only person getting rich that way is the person taking your money!

Salon Classic Hair + Scalp Therapy

Affiliate Link: I may receive a commission purchases from this link.

Salon Classic Hair + Scalp Therapy
old wooden rural abandoned country cottage surrounded by bushes
Photo by João Vítor Heinrichs on Pexels.com


  1. These are great ideas and we have done some of them! We have used a lot of the child tax credit money to buy items that we have needed/wanted for a long time, but have put off buying because we didn’t have the money available. Some of these items have been “frivolous” but have brought joy (this is a hard one for me being the practical minded person I am, lol) and others have improved our quality of life (i.e. shelves for pantry items so they are organized and easy to find). We have also saved some money and been able to invest a small amount. (First time in almost 17 years that this has been an option for us, lol) Whatever you use it for (and whether you agree with the idea or not!), just make sure you are being a wise steward of your money. God Bless 🙂

    • Thats great! I trust that you are being a good steward . We have definitely used some of the covid money for things people might call luxuries , but other people call necessities. 😊 But we’ve tried hard to use it wisely . It has been a blessing. I really hope this list helps someone. Thanks for reading!

  2. Thanx for the solid advice for those who will receive the Advance Child Tax Credit. However, it is basically a ploy by the Biden administration to “buy” voters before they realize the disadvantages of getting the money early.
    Stewardship as you teach is critical.
    ❤️&🙏, c.a.

  3. Good post! Thanks for warning people about the Advance Child Tax Credit. It really is an advance on your own money. I just groan when I think of people not realizing that until they wind up owing taxes this year.

    Awesome advice about buying tools, too! There are some jobs you can do if you just have a few supplies. Lawnmowers are great to have. A bucket of cleaning supplies. I do a lot of sewing, so needles and thread are good to have.

    • $110 billion for the expanded ACTC . Covid was the magic key to open the door to monthly support payments, no taking it away now . 😕 Capitalism is dying and corporatism/fascism is growing .

I'd love to hear your thoughts!

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s