Economic Stimulus Checks: Save or Spend?

Over the past week, I’ve put together some details about the tax rebates associated with the proposed economic stimulus plan. Given all the attention that this has been getting, I thought I’d put together a formal poll just to get a sense of how likely it is that people will do as the government is hoping and spend this money.

As a reminder, I noted in my tax rebate followup that this a straight up payment, and not an advance on next years tax refund. So, with that said, lets get to the poll…


Note: If the poll doesn’t work properly in the RSS feed you’ll have to click through. Sorry.

88 Responses to “Economic Stimulus Checks: Save or Spend?”

  1. Anonymous

    I think it is a joke that we get $250. Being on disability, I used it to pay one months electric bill. It would have been nice to have been able to use it for something nice for myself for a change. I think Obama is a joke.

  2. Anonymous

    Intending to “buy American” I spent it on a new refrigerator. The label inside says “Assembled in USA”, but there is nothing about where the parts came from.

  3. Anonymous

    I will splurge, and spend the money on my kids. The way things are looking, extra money will soon be a thing of the past for most of us. I just wish my check would hurry!

  4. Anonymous

    My hubby changed jobs and had to cash in his retirment that was’nt transferrable making it so we owed taxes on it at the end of the year so my stimulus will be withheld i guess to pay the irs. I should get around $30 yeah i’m putting that lil nest eeg in the bank for sure!

  5. Anonymous

    maybe u should just kill yourslef. Well i assume you all who complain about it’s not enough and it is a joke will be simply throwing your check in the trash as soon as it arrives. you people who complain about a free $600 are a joke. We have a president who has done nothing but good for this country and you complain about him and then you complain when he gives you free momney! You people lose all credibility when you say things like….”this stimulis check is a joke.” if you don’t like the free money, throw it away when it arrives and move to china or some other communist country and move away from our country. go live in poverty with 80% of the rest of the world and leave us alone in the greatest country in the world. oh and to solve your problem with rent going up, buy instead of rent. get a fixed interest rate and walllah your monthly payment will remain consistent and you will actually own somehting instead of pissing money away!

  6. Anonymous

    When I got my check I just wanted to cry. I did want to do something with it to just give myself a breather and enjoy myself but that was a big joke. I had to spend half off it on getting my car fixed. Then I actually owe the state of Maryland 500 dollars…. I just feel like my life isn’t even worthy anymore. I have a professional job, i’m not a loser and I can’t even do anything because the economy is so bad. Even my rent costs keeps increasing …

  7. Anonymous

    I also like others, didn’t know that if you owed no tax, you would only get $300. I had planned to buy a sofa with mine, but I guess that would be next to impossible with only $300. I guess I’ll put it in a envelope and stash it somewhere safe in case my car breaks down again. I have no debt to put it towards.

  8. Anonymous

    This economic stimulus check is a BIG JOKE!!! My family and I distinctly remember reading the bottom feed line on the news channels AND hearing the reporters talk about the stimulus checks and what they stated was that single people would receive 600.00 and married couples would receive 1200.00. Never mentioned that it started at 300.00 and that in order to qualify for it you had to claim yourself as a dependent. I made slightly over the 3000.00 income required, but because is was so low my fiancee once again claimed me on his tax return and he really didn’t need to because we had enough itemized deductions that he still would not have owed any taxes. But he won’t even get 300.00 for me as a dependent because I’m not 17 and under! Had we known, I would filed my own tax return with myself as a dependent and qualified. The mere fact that this was not EXPLAINED FULLY to the public is going to have a lot of people across the U.S., who were counting on these checks to pay bills or even catch up on a house payment, really ticked off!!! These checks are supposed to be credits towards our 2008 taxes, which we haven’t paid and are based on our 2007 taxes, and as I am a taxpayer, paying taxes every week throughout the year, I and others like me DESERVE to have a check as well. This is a complete slap in the face! It’s time to put the government into the hands of “We the people of the United States” and out of politicians who are certainly going to get theirs.

  9. Anonymous

    Wow this stimulus check is a joke.. I am a single mom who is raising 3 teenage daugthers by herself.. All under the age of 18 and 1 who turned 17 in the end of December so none of my girls qualify as dependents for the purpose of this check.. I am also trying to pay for college for 2 of them and clam them all as dependents so they cant receive a stimulus check themselves. I worked my way through college while raising 3 girls by myself and working and also received no financial support from my loser ex-husband. After college I landed a job with a big company and have worked my butt off to get to the position I am in today. My AGI is over the limit for this check so the government is so generous they cut me a check for $49 bucks.. WOW.. that is so stimulating let me tell you.. it is a slap in the face and makes me want to tell them to just keep it.. On the other hand my ex husband who cant hold down a job and has never provided a dime to support these girls will walk away with $600 bucks in his pocket.. Wow way to go Bush.. Way to stimulate me.. I am going to spend my $49 bucks on Bush Toilet paper to wipe my butt with..

  10. Anonymous

    Refreshing, but not comforting to see that my husband and I are not in this alone…We were planning on using our stimulus check to pay for my much needed shoulder surgeries (we have UHC insurance which basically means that the surgery will be paid in full by us), but it’s starting to look like that will have to be put off even longer so we can use it to stay ahead of our bills…ugh! Sadly, when I say “bills” I mean mortgage, utilities, gas, food, and our 1 credit card (which we are trying desperately not to rely on). Can anybody out there see the light at the end of the tunnel?!

  11. Anonymous

    Since my husband was laid off 3 months ago, we have no choice but to spend our check on bills! I am also wondering where this money is coming from…Maybe the bush clan and the other big oil rich people have kicked in a little of their profits from the last 3 months to keep us shut up while they jack up gas prices for summer!! If you can, buy a bike and ride it!

  12. Anonymous

    Why would you donate the money to charity, if everyone would get off the couch and get a job then they don’t need our handouts. Anyone can get a job at mcdonalds making $15,000/year and afford a $350 apartment a month along with another $200 in bills. If they had a job they could be getting there own stimulus check and not mine! Everyone needs to take care of themselves and there own families.

  13. Anonymous

    I am taking my check, which I already know I’ll be getting, and putting it away for the next heating oil fill-up. 175 gallons costs $598.33 and that was only 3 weeks ago. Stimulate the economy by spending it foolishly would be insane. and I do agree with other comments here that the government does not have this money to give us to begin with. Who’s kidding who? We’ll all be paying for this in the end. It’s called deep recession or DEPRESSION.

  14. Anonymous

    I have to change my answer, sadly. I thought I could spend the check on fun things, but it appears even with health insurance and paying co-pays im getting stuck with another load of medical bills, (big family). It gets really old having to spend tax return or any other money we ever get on the american healthcare system. Im not trying to blame america for it. Go home illegal immigrants and stop messing our economy up. Im still buying a big punching bag.

  15. Anonymous

    Seeing as they keep my income tax refund to apply to my student loans, I don’t expect to see any of it. But the $2100 will be a big chunk out of my loans. If we do end up with some, we plan on spending it on my wife’s school tuition. Yes it will be spent but not on stupid stuff…. really an investment in her earning power.

  16. Anonymous

    No fair for me! I am on Social Security Disability. I have to pay taxes on my social security but don’t get a refund check for myself. My medical bills are overwhelming.
    I plan to hold the money my husband and children get until school starts – then use it to pay school fees and buy school clothes for my two teenage boys. They both will be in High School this fall – just to start school (book fees, lunch money, tuition…etc) will cost us about $800. That doesn’t leave much for clothes, shoes and extra curricular. I’m sure Busch could care less about that. He doesn’t even know how much consumers are having to pay for gas. What a self absorbed idiot. He doesn’t care because he is set for life. He will get income and all medical paid for until he dies. May God have mercy on his soul!

  17. Anonymous

    My family and I are spending it, in fact honestly we will not even spend it wisely. We always have great intentions to make our money work, but we would definitely like a swimming pool, even a above ground one. My car needs tires. Likely we will be convinced to get some video games or a big punching bag.

  18. Anonymous

    I can’t believe it but we will be paying the first half of our property taxes with this!!! It just doesn’t seem fair. Everything is going up except our pay checks.

  19. Anonymous

    ill be investing it. if the wonderfully brilliant govt. that dreamed up this idea decides that when china needs to be paid back next year through the federal income tax, ill be happy to pull it out of stocks and hand it back and be happy i made some cash off it.

    its a good idea but poorly executed. to me this method is probably one of the dumbest things the govt. could do to “stimulate” the economy. more national debt. brilliant, g-dub.

  20. Anonymous

    The whole idea is so absurd to me, I have been barely scraping by since the middle of last year. Business is down all over in my area; and my paychecks have been down too!
    So I’ll definitely be spending it; but it’s not like I’ll be buying a new tv or anything.
    I’ll be paying for unforeseen medical expenses my “insurance” won’t cover.
    I’ll be paying my family back for money I had to borrow so I could pay my mortgage last month.
    I’ll be saving the leftover PENNIES to try and buy enough gas to make it to work.
    And then I’ll sit back and wonder how I’ll get through the rest of the year.
    Wow do I need a new job. Or a second job.
    It’s very hard when you train for a career and then business dries up.

  21. Anonymous

    The Wife and I are budgeted for the year, including a savings plan. Therefore, the rebate check will go for a much needed new computer with the remaining going into our home improvement fund and being spent as quickly as I can knock out projects.

    I’m not familiar with this website so I’m not sure of it’s reader base. However, these kinds of polls happen every time rebates and tax refunds happen. They consistently show a majority of people who say save, pay bills or reduce debt. When the pollsters go back and measure what people actually did (however they do that) they find that the vast majority of people spend it regardless of whether their particular financial situation dictates they should not or not.

    My personal recommendation is that if you have credit card debt, fork it all over to that. If you do not, though, do our economy a favor and spend at least half of it. Given the culture we live in, if you do not have credit card debt you, most likely, have a solid financial plan and are disciplined enough to follow it. So, spending some of this money is not going to set you back from your goals but, history shows, it will stimulate the economy and, thereby, possibly stimulate your portfolio.

  22. Anonymous

    I’m in with those paying down debts already incurred. If I do see a check it’ll get me debt free 2 months earlier than my current financial plan has forcasted.

  23. Anonymous

    If….then we’ll put most of it in the rainy day fund savings and use a small portion to buy a few cases of local wine. Gotta have some fun during the recession 😉

  24. Anonymous

    We will be choosing to cash the check; if we recieve one as we still have our doubts, a lot of things can happen between now and then. Once the check is cashed and money is broken down to smaller denominations it will be stashed in a secure area of our property. (Picture bills in a rusty coffee can buried in a hole in the backyard, kind of thing only better!)
    This really is saving but not in the conventional way, therefore our anwering “other.”
    We are planning this so as to have some reserve more than likely to barter with. There will always be those who are so comsumed by monetarial greed they will trade things for cash. Keeping a sum outside of normal financial institutions won’t earn us any additional interest, but should the loans the US have be recalled by China or other holders, as is becoming more and more likely, that earned interest would never be seen by us anyway, let alone any of our personal funds being kept there.
    If we keep it with us for a time when we may need it to get something we need/have to have and otherwise would not be able to obtain, we look at that as emergency preparedness.
    This rebate may be looked at as found money by many, but in reality we have already spent it once through payment of income tax, so why not just continue to live without it, putting it away for not a rainy day but a day the the sky truely falls.

  25. Anonymous

    I plan to spend some of it on food and emergency supplies. I hope to acquire a 3 month supply of food stores for my family. That way if a recession hits, we will have a head start on our groceries. I will save the rest.

  26. Anonymous

    I will probably use it to pay property taxes without dipping into the savings account we would usually use for that purpose, though honestly I’m also considering a charitable contribution so it can go to someone who needs it more than I.

  27. Anonymous

    I will use the rebate to pay my next estimated tax installment for 2008. I won’t even cash the check, I’ll just sign it “Pay to the order of the US Treasury.”

  28. Anonymous

    While the government certainly hopes that people will go out and spend the money and boost the economy, I will be saving it and likely investing most of the money. One has to do what is best for their own situation.

  29. Anonymous

    I count spending it to pay down debt as spending, and that is what we will do with 1/2 of it.

    We will probably use about 1/2 of what we get to supplement our vacation savings. That money will be going to travel expenses and hotel for a trip to Glacier National Park sometime in mid-summer.

    To bring back and old travel slogan “See America First”.

  30. Anonymous

    I’m planning on paying part of my 2007 tax bill. We try to set up withholding to be close to break even, but owe a bit every year. I don’t know if handing it right back to the gov’t counts as spending?

  31. Anonymous

    Eric, Just make sure to get the full size one with the 13 round mag. That really tends to get a rise out of people. Or better yet just go for the AR-15 or AK47. Get them before they try to ban them.

  32. Anonymous

    Curious if you know much about the proposal in the stimulus plan of raising level on Jumbo loans from $417,000 to something like $795,000? Would this potentially impact the interest rates of these loans – hopefully bringing the rates down a bit? Thanks.

  33. Anonymous

    This money will go into our already-established fall Hawaii trip fund. Not sure it this counts as “saving” or “spending”. I did a first run of our taxes, and given this rebate plus my federal and state refunds, the trip is pretty much fully funded. Aloha!

    Hey, I noticed that the original post has a misspelling: “givernment”. Was this a Freudian slip? 🙂

  34. Matt: You have a valid point with regard to paying down debt. I would either classify that as savings or ‘other’. But the emergency fund? That’s clearly saving, no matter what name you choose to attach to the end result.

  35. Anonymous

    If it comes (and it probably will. After all, what member of congress is going to want to be remembered for voting against it, especially in an election year?), I plan to put the $600 in my IRA and will let it grow tax-free.

  36. Anonymous

    Why don’t you have an option for pay down debt, or put towards emergency fund? Or is that included in the save option?

    I’m going to put all of it towards my student loans as well as my tax refund.

  37. Anonymous

    I’m making an extra $500 payment on credit cards and banking the remainder in emergency savings. I’m too close to the edge to put the entire amount down on credit, and I’m definitely not spending any of it on junk I don’t need.

  38. Anonymous

    I was watching Your Money on CNN today and the “experts” were saying that many people will use the rebate to pay off debt or save it for times of uncertainty. They gave many reasons – rising costs of food and gas, job uncertaintly, personal debt, etc. They said its during times of uncertainty (like now) that people cut back and during boom times (the 90s) or times of easy credit (early 2000s) when people spend like drunken sailors. So maybe this poll isn’t too far off – but I agree with most that this sampling is going to be more inclined to save.

    I need new tires so that’s where mine will go, although I would have bought them with or without a rebate. But get this – I priced 4 high performance Michelins for $170/tire (gasp!). 18 months ago I had to buy 1 (same tire) because I slashed the wall on a sewer grate. That 1 tire was only $125 then. I know tires are made from petroleum and it has gone up in the last year and a half, but an extra $55/tire hurts! Inflation, OUCH!

  39. Anonymous

    If they’re just going to give you a pre-April 15th tax ‘refund’, then you’ll just want to pass it back in quarterly taxes or make sure you calculate it in your taxes.

  40. Anonymous

    The rebate will be used to payoff a little debt we have left and the rest will go into a MMA to grow a little more so we can stay on course to retire early. Trying to be personally responsible now so I can reap the rewards later. Yeah – I’m an ant. 🙂

  41. Anonymous

    I plan to spend most of the money locally, at owner-run stores and restaurants as much as possible. I think that’s the best way to stimulate the economy and not feed the banks / insurers and importers of foreign-made goods. I’m a retiree with little debt and a lot of neat shops and restaurants within walking distance; those are real factors in my decision.

  42. Anonymous

    Well, in the first place we don’t have a tax rebate yet: it hasn’t been approved by Congress.

    I’ll believe it when I see it. If anything is forthcoming, I expect I’ll end up using it to pay taxes. Just printed out a Quicken report for my tax lawyer: 126 pages! If any money comes back from the gummint, it will go straight to the money market account where I set aside savings to pay taxes. And tax preparers.

    There’s no excuse for this country’s byzantine tax structure, nor any excuse for the vacuity that lets some of our leaders imagine forking back a few hundred bucks to taxpayers instead of using funds to provide needed services is a grand idea.

    About 90 percent of the junk our esteemed leaders think we’re going to diddle this money away on is made overseas. We’ll stimulate an economy, all right: China’s.

  43. Anonymous

    I’m going to invest it international assets or gold. It’s really starting to get to me how the government keeps spending money it doesn’t have. Handing out free money just comes back to bite you in the form of inflation.

  44. Anonymous

    m.b. –

    The bottom line is that you aren’t going to owe this back the following April.

    It is an adjustment to the 2008 tax rates. So it is not an offset of 2007 as near as I can tell but it is actually a reduction in the 2008 tax structure and we receive all the benefits of that reduction in one check in May. So this should not give you a smaller or larger refund or make you owe less or more when you file your 2008 taxes in April. So spend away.

  45. Anonymous

    I am one inclined to save. I fit the profile of most of the readers here. But this check is being spent on American goods. My portion going to stuff I like, my wife’s to stuff she likes and my daughters to presents for her. My normal policy for “extra” money is to save/pay down debt/retirement account and invest in an index fund.

    The government wants us to spend this money. I don’t fully agree with the stimulus and happen to think it is not great wisdom to borrow against our debt to do this when inflation is going sky high as it is (don’t like preemptive interest rate cuts much either.. I think like forest fires, economic recessions are sometimes necessary to help prune and eventually strengthen the economy… preventing either through unnatural means only makes the fire or recession worse when it finally beats the feeble attempts to stop it)..

    Even though I don’t fully agree with it, there are things that we all would like.. For me it will be fly fishing stuff from a local fly shop. Going to purposefully buy American made goods (there are a few manufacturers in NH where I live and I may even steer towards their goods). This way I can at least feel like my ever so tiny portion at least helped a local business owner, a local supplier and a regional or at least national manufacturer. Will my check being spent alone dent the GDP? No. but if we all spend some or all it would make an even bigger impact and actually do what congress hopes it would do.

  46. Anonymous

    I’m still confused. I saw in the Baltimore Sun article you referenced where they say it won’t be an offset to next year’s tax like the 2001 rebate.

    But I also see sources that say it is an elimination of the 10% tax bracket for 2008.

    These seem to be conflicting statements.

  47. Anonymous

    I’m going to forward every single penny of the stimulus checks we receive into our outstanding credit card debt, immediately and without second thought. I’m not quite sure how much we’ll get quite yet, but we’ll certainly be getting our fair share.

  48. Anonymous

    I think even if this poll were on something like MSNBC, you’d see a very high number of people saying ‘save’ (probably at least 50%). When in actuality, several newspapers and have indicated that close to 75-80% of the money will get spent within 6 months.

  49. Anonymous

    I curious about the results but I have a feeling your poll will skew toward the saving side simply because of your reader base, so figure that the actual “spend it” rate of the average consumer would be at least 10-20% higher than what you will find in this poll.

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