Washington, D.C. Consumers will be spending their stimulus checks at retail outlets, but their purchase plans have shifted, according to a new survey from the National Retail Federation.
Consumers plan to spend approximately 40% of their tax rebate checks, filtering $42 billion back into the economy, the study said. Rather than purchase discretionary items, including electronics and apparel, shoppers are focusing on necessities like gas and food.
As fuel costs continue to rise, 17.2 million people plan to use some of the money to pay for gasoline. This is a drastic jump from February, when 12.1 million people who said they planned to make gas purchases.
Similarly, the rising costs of everyday staples like milk, bread and rice are pushing more consumers to spend the checks on groceries. Specifically, 21.2 million people will use a portion of the check for food, up from 20.4 million people in February, the study reported.
“For many consumers struggling with rising bills and lowering home values, economic stimulus checks could not come at a better time,” said NRF president and CEO Tracy Mullin. “The rising cost of groceries and gasoline means that discretionary spending is taking a backseat to necessities.”
Consumers have other plans for the remaining funds, as well. Some of it will be used to pay down debt ($28.1 billion), some will go toward paying medical bills ($4.9 billion); and some will be invested ($3.4 billion).