According to a survey by the Federal Reserve Bank of New York, Americans spend most of their incentives on debt repayments and savings.
Respondents Survey of consumer expectations by the Federal Reserve Bank of New York It’s for the third round of stimulus checks that sent $ 1,400 to qualified Americans They were going to use It saves about 25% and 41% of total payments and uses the remaining 34% to repay debt.
These answers show that Americans are spending a small amount of money compared to the first two rounds of bailout payments. By comparison, studies show that Americans used 29% of checks, saved only 36% in the first round of checks, and were worth $ 1,200 in March 2020.
The third round of stimulating checks was included in the $ 1.9 trillion American Rescue Program, which was signed by President Joe Biden on March 11. The IRS said more than 130 million checks, worth $ 335 billion, have already been sent.
Researchers say that how people spend their stimulus depends on their household income and education level. For example, households with income of less than $ 40,000 expect to spend 44% of their second stimulus check on debt repayment, and households over $ 75,000 will spend 32% of their money on debt. Households earning more than $ 75,000 spent 24% of stimulus checks, and low-income households spent 27%.
Spencer Richards, 32, of Utah, First two stimulus checks According to CNBC, they lost two jobs during the pandemic because of rent and food. Richards said he plans to use the third check for surgery that is not well covered by health insurance.
“I’m worried about the potential consequences of the government taking on a lot of debt very quickly, but the payments have brought great benefits to my family,” Richards said.
Households without a college degree expect to spend 37% of their third incentive on debt, while households with a degree will spend 27% for the same purpose. It states.
One college student, Barca told Vox A $ 1,400 stimulus check is heading for the bill.
“My monthly salary as a graduate student is $ 2,000 and the stimulus is $ 1,400. It takes less than a month. First I used the stimulus to clear important invoices, and if there was anything left, Get better headphones for Zoom, “says Varsha.
Economists at the Federal Reserve Bank of New York said the findings show “high unemployment, as well as high uncertainty about the duration of the pandemic and its ongoing economic impact.”
“As the economy resumes and fears and uncertainties recede, high levels of savings should drive more spending in the future,” the researchers said. “But there is a lot of uncertainty and controversy about the pace of this increase in spending and the degree of stagnation in demand.”
According to CNBC reports, Stacy Starkey, 37, said she had difficulty finding a job while homeschooling her 11-year-old daughter and would use a stimulus to pay late payments. ..
“I will do my best [and] Stretch as much as possible, “said Starkey.
The sample size of the Federal Reserve Bank of New York’s Consumer Expectations Survey is 1,300 households. Data from the second and third stimulus checks were obtained from the January and March 2021 surveys, with 1,062 and 1,007 respondents, respectively. Data on the first round of payments came from a June 2020 survey of 1,423 respondents.