We saw the stimulus effect of $ 1,400 per head that started hitting US bank accounts back in March, weakened a bit. Some spent the money on immediate needs. Many who didn’t need it right away still keep some of that money to help in their bank accounts.
Like Emma Flynn, 26, who worked at a hospital in a coffee shop in Omaha, Nebraska for $ 10 an hour. Then he hit COVID-19 and she quit. Her first $ 1,200 relief payment covered the rent for a month, “and then I started withdrawing money from my Roth IRA,” she said, “any money I put in and could withdraw without penalty.”
Flynn has now returned to work and has invested $ 1,400 in savings. “I’m just trying to get back all the savings I spent, I hope it will grow and I will be able to retire one day,” she said.
Some saved or invested their checks. Others pay student loans, buy new windows and go on vacation. “Families in our lowest-income quartile, we’ve seen more than double their liquid cash balances, with each round of relief,” said Fiona Greig of the JPMorgan Chase Institute, who monitoring how relief payments affected the state of banks in America.
These households spent most of that money inconvenience immediately on food, rent, medicine, and utilities. Economist Jay Shambaugh of George Washington University said government relief has changed the financial trajectory for millions of households.
“We have seen that delinquency is decreasing, cars are being returned less, similar things, where people could make payments because they received this kind of support,” he said.