LAS VEGAS (KTNV) — How are people spending their stimulus checks?
According to a survey by the Federal Reserve Bank of New York, people in 2020 used their stimulus checks to buy things (29%), to pay bills (35%) and for future needs (36%).
The first $2.2 trillion stimulus package was passed by Congress in March 2020.
The purpose of the package was to stimulate the economy through stimulus checks. However, two thirds of the people surveyed used it to pay off their debt or put it into savings.
The people who did spend it used 18% of the money on necessary living expenses like food, utilities and rent. 8% was spent on non-essentials like hobbies and leisure activities and 3% was donated to charity.
35% of those surveyed said they put the money aside because of uncertainty about the future, restrictions on in-person shopping and “delayed” rent payments.
The other 36% of those surveyed said they used the money to pay off student loans, personal loads and credit cards.
People who were over 40, white, college educated and had an income of over $75,000 were most likely to save.
People who were over 60, non-white, not college graduates and had an income of less than $40,000 were most likely to spend on essentials.
People most likely to spend on non-essentials and donate to charity were also over 40, white, college educated and had an income of more than $75,000.
Those who used the money to pay debt were between the ages of 41 and 60, non-white, no college degree and had an income less than $40,000.
The Federal Reserve Bank concluded that while the economic impact payments were a significant boost to the economy, households spend a relatively small share of the payents by June 2020.
According to the U.S. Census Bureau’s Household Pulse Survey between Feb. 17 and Marc 1, 2021, more people are planning to use the money from the most recent check to pay off debt (52%).
The survey also found that 28% are planning to spend it and 19% are planning to save it.
For those who are spending it, they plan on spending 57.6% on food, 44.2% on utilities, 35.7% on household supplies, 30.6% on personal debt and 25.5% on rent.