Whether it‘s $ 600, $ 1,200, or $ 1,400, Americans have been consistent in how they have spent all three stimulus checks. But what has changed is its allocation of savings versus spending, according to findings released Wednesday by the New York Federal Reserve. In the first round of economic impact payments, households reserve 29% of their checks for consumption. In the second round, that fell to 26% and in the most recent round it fell to 25%.
“In this latest round of stimulus checks, households reported that they expect to spend 13% on average on essential items and 8% on non-essential items. ”
In January, households reported that they used or planned to use an average of 16% of the second round stimulus funds for essential expenses and 6% for non-essential expenses. In this latest round of stimulus checks, households reported that they expect to spend 13% on average on essential items and 8% on non-essential items. The survey results reflect “high uncertainty about the duration and continued economic impact of the pandemic,” including “high uncertainty about future inflation,” economists at the New York Fed wrote in a publication. That said, consumer confidence, a measure of how consumers feel about the economy, hit a pandemic high last month as more Americans get vaccinated against coronavirus and businesses can reopen with fewer restrictions. So far, the Internal Revenue Service has distributed 156 million stimulus checks, totaling $ 372 billion, as part of the $ 1.9 trillion American Rescue Plan, as of Wednesday. That includes about 25 million payments that were made to Social Security and VA beneficiaries. Of the households surveyed by the New York Fed in March, about 32% reported that they had received a third-round payment, with an average payment amount of $ 3,162.