Those $1,400 stimulus checks that started hitting mailboxes in March are proving valuable to people overwhelmed by debt.
A study from bill paying service doxo finds that 62% of stimulus checks are being used to pay bills, with a significant portion of that earmarked for credit card debt.
From March 17 to March 21, the service saw a 29.8% increase in the number of payments compared to the same period last month. And the total amount of payments was up 37% compared to February.
Credit cards payments saw the biggest lift, with 29% more cardholders making payments while the amount paid jumped 72%. Utilities came in second, with a 23% increase in payments compared to a month ago. Cable/Internet companies saw a 20% increase in payments.
Since the start of the pandemic, says doxo, 42% of Americans have skipped paying at least one bill.
The doxo numbers fall in line with data from the U.S. Census Bureau’s Household Pulse Survey. In March, a study from that group showed the majority of stimulus check recipients planned to use the money on food and utilities, as household budgets remained stretched during the pandemic. A study of 110 million people who reported receiving stimulus checks, taken between Feb. 17 and March 1, showed debt reduction and household expenses as the top priorities.
Day-to-day spending items were the lowest priority for consumers, according to that Census Bureau survey. Clothing was on the agenda for just 10% of recipients. Just 6% said they were considering household items, including TVs, electronics, furniture, and appliances. And just 2.5% had plans to buy recreational goods, such as sports and fitness equipment, bicycles, toys, and games. (Respondents in that survey could choose more than one category.)
