President Biden's $1.9 trillion stimulus package known as the American Rescue Plan includes $400 billion direct payments to Americans, about 21 percent of the total amount. Americans who qualify receive $1,400 checks.
In the latest TIPP Poll, we asked respondents how they plan to spend the stimulus payment. Here are the answers:
- 35% plan to save the money
- 33% to pay for food/grocery
- 27% to pay down credit cards or other debt
- 19% to pay rent/mortgage
- 17% for home improvement projects
- 11% use it towards a down payment for a car or a home
- 9% want to invest in the stock market (stocks, ETFs, bonds, etc.)
- 7% would like to invest in cryptocurrencies (Bitcoin, Ethereum, etc.)
The two investment categories netted out 13%. TIPP estimates, approximately $45 billion will go to the stock market.
So, who plans to invest in the stock market or cryptocurrencies? You'll find the answers in the chart below.
According to the National Bureau of Economic Research, Americans spent 40% of the one-time $1,200 payments provided by the CARES Act last spring, while the remainder saved it or used the funds to pay down debt.
US stimulus Will Stimulate Global Economy
President Biden's $1.9 trillion stimulus package would not only provide a significant boost to the U.S. economy, but it would also have a significant impact on the rest of the world. A thriving U.S. economy will ultimately benefit the world as a whole.
The countries that stand to benefit from the stimulus-induced consumer spending the most are China, Mexico, and Canada.
The Organization for Economic Co-operation and Development (OECD) estimates that the stimulus package could increase China's gross domestic product by 0.5% over the next year.
According to Allianz S.E., our spending on computers, household equipment, and clothing will boost China's imports by $60 billion between 2021 and 2022.