Such a move could lift more than 7 million people out of poverty, according to a recent analysis from the Urban-Brookings Tax Policy Center, a nonpartisan think tank.
Matt Schulz, chief credit analyst at LendingTree and nationally recognized credit card expert with more than a decade of experience in helping Americans make smarter decisions about their money also addressed the mattered earlier in a report.
“That’s a huge difference, but it’s a good thing. Nine months ago, most Americans were terrified and had no idea what the future held, so they focused on basic expenses and building up savings. Fast-forward nine months, and things have changed a lot,” Matt Schulz said in the report.
“Repeated stimulus and reduced spending means people have more cash in their pockets, and that—combined with the hope spurred by widespread vaccinations—has given them the luxury of paying down debts instead of solely squirreling away cash.”
According to the LendingTree report, only 19 percent of stimulus check recipients were using the $1,400 payment for basic expenses (citing US Census Bureau data)
“Make no mistake: It is very, very unusual for people to pay down debts in a massive way in an economic downturn. It just doesn’t happen, especially when unemployment is at record highs. The combination of government stimulus and reduced personal spending, among other things, made that possible during the past year, though,” Schulz added.
“Yes, many, many Americans have been financially devastated and may never quite recover, but a surprising number of Americans will emerge from the pandemic in far better financial shape that most anyone would’ve predicted.”
In the past year, three rounds of stimulus checks — payments of up to $1,200, $600 and $1,400 per person — helped to raise income by 20% for the lowest-income households, according to the Economic Security Project’s new report.