At times, it’s hard to believe that it’s only been a few months since the COVID-19 pandemic radically altered the lives of millions across the nation. Memories of a world before the virus can often seem incredibly far away – a lifetime ago, even.

Lockdowns enforced in mid-March caused the U.S. economy to come to a grinding halt, leaving numberless Americans out of jobs and unable to manage their monthly expenses. In April, nearly 9 in 10 Americans said the COVID-19 crisis was causing financial stress – and their money habits, in one way or another, had to change to adapt to the new normal.

To keep you informed on the major ways COVID’s impacting Americans’ money habits, we’ve pulled together statistics on a number of topics such as:
  • people’s experiences with stimulus checks and how they used them
  • the staggering, record-breaking rates at which Americans’ are saving
  • product categories with the highest increases and decreases in consumer spending

Let’s start by taking a closer look at the numbers behind Americans’ experiences with stimulus checks.

The stats on stimulus checks

In March, the U.S. government passed a $2.2 trillion economic relief package in response to the growing pandemic. Under the package, individuals making less than $75k would receive up to $1200, married couples making less than $150k would receive up to $2400, and taxpayers with children would receive $500 for each child.

So, that was the plan. How have things turned out so far?

As of Jun 12th, the IRS delivered around 159 million checks amounting to $239 million in total. While the stimulus payments provided relief for many, not all of the deliveries went off without a hitch. According to a survey by LendingTree, around 1 in 4 Americans reported problems with their stimulus payment. The top 3 issues reported were:

  • I qualified for a stimulus check, but never received one (41%)
  • I qualified for a stimulus check, but received more money than I should have (24%)
  • I qualified for a stimulus check, but received less money than I should have (15%)

Fortunately, over half (54%) of the respondents surveyed were able to get their issues resolved and received the appropriate amount of relief – but that still leaves countless others without adequate aid.


If you’re one of the many Americans facing a difficult financial situation at the moment, we have a few resources that could help make it more manageable:


LendingTree posed a second question in the survey, which was: “Did your stimulus payment help your financial situation?” Out of the 1,000+ respondents, these were the results:

  • 39%: the stimulus check helped significantly
  • 48%: the stimulus check helped a little bit
  • 13%: the stimulus check barely made a dent

While the majority found the stimulus checks to be at least somewhat helpful, what about the 13% that claimed it barely made a dent? The survey results revealed that a majority of the population had been furloughed or laid off due to the pandemic. Unfortunately, many people have found themselves in this exact situation, and a one-time stimulus payment can only provide so much relief.


If you’ve recently lost your income, check out the first episode of our new video and content series Just Ask! Traci Kelly, the founder of financial firm Kelly Greene, joins us to share her simple, step-by-step process for developing a financial plan after experiencing a sudden loss of income.


How stimulus checks are being used

A few weeks ago, the U.S. Census Bureau sent out surveys to millions of Americans and asked them how they used (or planned to use) their stimulus checks. After analyzing the near 75k responses they received, they released their findings in the Week 7 Household Pulse Survey.

Covering expenses

Around 60% of respondents used most of their stimulus check to cover expenses – particularly food, housing, and housing-related expenses, like utility, internet, and cellphone bills. More than half (58.2%) of respondents spent some of their checks on personal care products and household supplies. 20% reported spending a portion of their payments on clothing.

Paying down debt

13% of respondents used some of their stimulus checks to pay down existing debt. For 70% of this population, credit card and student loan debt were the primary targets; vehicle payments were the next most commonly paid down type of debt (25%), with mortgages following shortly after (20%).

Saving and investing

12% of respondents decided to save or invest the majority of their stimulus payments. According to the survey, households with incomes between $75 – $99k were more likely to use their stimulus checks to add to savings, while nearly 90% of households with incomes of less than $25k used the stimulus to cover expenses.

Read more: Suggestions on What to Do With Your Stimulus Check

The future of the economy and job market is still very uncertain, and uncertain times result in people holding onto more of their income. This trend couldn’t be better reflected in the topic we’re about to cover next.

The U.S. personal savings rate hits a record high

The U.S. personal savings rate describes the percentage of money Americans save compared to their total income. In times of economic downturn, people typically start stacking their funds instead of spending money, driving the rate up. As you could expect, the U.S. personal savings rate has been much higher than usual over the last couple of months.

In April, the personal savings rate hit a historic high of 32.3%, soaring far above March’s rate of 12.7%. To give some perspective, the previous record savings rate was set in 1975 at 17.3%. Since then, the rate’s hovered anywhere between 2% to 12% – until now.

Surprisingly, the personal savings rate dropped sharply in May, falling from 32.3% down to 23.2%. The fact that people are spending more of their income could be a good sign for the economy, but it’s difficult to make a solid judgment just yet. The situation is still evolving, and there’s a long way to go before a full recovery is made.

According to projections, the personal savings rate is expected to continue decreasing throughout 2020 and stabilize around 9.5% in 2021.

What consumers are spending on (and what they’re not)

Hanover Research recently shared a detailed breakdown of COVID’s impact on consumer behaviors which measured consumer spending across major essential and non-essential product categories. Through their research, they were able to identify the areas in which spending increased and those in which it decreased.

When it comes to essential products, these were the areas with the highest increases in spending:

Cleaning products and supplies (54%): During the first months of quarantine, cleaning products and supplies like disinfecting wipes, bleach, laundry detergent, paper towels, and nitrile gloves were in short supply and high demand. While the initial surge of demand has faded over time, consumers are still spending more than average in this area.

Education materials and services (48%) When schooling moved online and in-home, many parents had to purchase education materials to teach their children and keep them on track with their classes. In addition, a significant number of students were required to pay access fees for education services to complete their coursework.

Packaged/canned food (43%): As restaurants closed down, people had to begin cooking at home – and grocery sales skyrocketed. In mid-March, grocery sales were up a staggering 79% from the previous year (we all remember the checkout lines…)

And the areas with the highest decreases in spending:

Fast food, takeout, and delivery (32%): The forced shutdown of restaurants, growing concerns about food safety, and tighter budgets for the average American led to a sharp decrease in spending on fast food, takeout, and delivery services.

Personal care (17%): In times of severe financial stress, people often have to decide between paying their bills or putting food on the table. Personal care products, besides the absolute necessities, don’t make the list. It makes sense – no one is going out much, if at all, and consumers don’t see the point in spending money on personal care when the funds could be used somewhere else.

Non-essential product category spending

Consumers are less likely to spend in non-essential product categories compared to essential ones, especially when finances are strained. In fact, 38% of participants in the Hanover study responded that they’re not spending any money on non-essential products currently. That still leaves ~60% of people spending in these categories – so, what are they spending it on?

The top 5 areas of consumer spending in non-essential categories:

  • Video games, music and video streaming services (29%)
  • Clothing and accessories (24%)
  • Home improvement (17%)
  • Electronics (15%)
  • Arts and crafts supplies (15%)

As public venues closed, people had to find new ways to keep themselves busy while stuck at home. Consumer spending on “sit back and relax” forms of entertainment, like video games and streaming services, shot up significantly after the pandemic struck. Spending on personal hobbies like home improvement projects and arts and crafts also increased over the last few months, but not nearly as much as the clothing and accessories category, which saw the second-biggest gains since the beginning of COVID-19.

Now that you’re familiar with the stats, we’re curious – how closely does this breakdown reflect the changes in spending you’ve made in your own household? Are you part of the 38% of consumers that are avoiding spending money on non-essentials? Are you spending more on essentials now than you were before the pandemic? Share your experience with us on LinkedIn, Instagram, Facebook, or Twitter!


August 05, 2020


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