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We asked young consumers to tell us what they plan to do with the stimulus checks that are coming their way—here’s what they told us…
There’s no question that the COVID crisis will have financial implications for many young consumers. They’re being hit hard by unemployment, with YPulse research showing 13% of 19-37-year-olds have lost their jobs because of Coronavirus. Millennials already endured the Great Recession, which put them behind other generations financially and they’re now facing their second historic financial downturn—all before they turn 40. Meanwhile, Gen Z will likely be permanently impacted by Coronavirus as well, with some experts predicting the crisis will make them “a generation of supersavers.” Already, YPulse’s exclusive COVID-19 research has found that both generations are making financial changes because of the crisis, with 57% telling us that they have cut back on some spending because of Coronavirus.
At the same time, they’re still spending on the supplies and entertainment that they feel they need to get them through this time. Seven in ten Gen Z and Millennials tell us that they feel like they need to stock up on food and supplies to survive the Coronavirus crisis—and they’re helping to fuel booms in multiple industries, from video gaming to flour and yeast. Snack brands are reporting unprecedented online sales, and movie studios releasing theatrical films on-demand are saying that record-numbers are buying.
So even now, these generations are still spending—but what they’re spending on has shifted significantly. And nearly all will soon have at least some new money to decide how to spend: the pending stimulus checks. We wanted to know how these generations are planning to spend their money, and in the last week of March, we surveyed 1000 13-39-year-olds about the financial implications that COVID-19 has already had for them—from how they’re spending to their employment status. We also asked, “What do you plan to spend your stimulus money on?” What they told us says a lot about their current mindsets and what their spending could look like post-pandemic. Here are the top responses we received:
What They’re Planning to Spend Stimulus Money On
- Food / Groceries
- Necessities / Supplies
- Investing / Stocks
- Healthcare Products / Medicine
- Things for kids / family
- Things I need
- College / School / Education
- Video Games / Console
Practical purchases and payments top the list of what Gen Z and Millennials plan to spend their stimulus money on, with “bills” the second most common response we received. Many told us that using their checks (or direct deposit) on bills is “the smart thing to do.” According to Crediful, a personal finance website, Millennials are the most likely to plan to use stimulus checks to cover housing costs, and our research echoes that, with rent also coming up in the top five ways they’re planning to spend it. Saving the stimulus was also a popular response, coming in at number three on our ranking here. In 2019, we asked Gen Z and Millennials about their biggest financial worries, and savings and debt topped the list—and they’re continuing to prioritize both.
But the number one thing that young consumers say they’ll be spending their stimulus check on is food and groceries. Young consumers told us that they plan to stock up on supplies, and are unsure of how long the crisis will stretch on. Many have been worried about stocking up, with almost half of young consumers telling YPulse that they’re afraid of running out of supplies because of Coronavirus. So CPG brands can expect that their boom will continue, as food is the biggest necessity to these generations. They’re also spending money on restaurants, with one Gen Z student explained to us that spending money ordering food feels like the only way he can help. Like him, about 21% of Millennials and Gen Z are actually ordering more food delivery during the COVID-19 crisis.
We should point out that there are other industries that could be impacted by young consumers’ stimulus plans. Clothes ranks at number six on the list, driven by Gen Z consumers who were more likely than Millennials to say that this is what they’ll spend their money on. Meanwhile, some young consumers plan to invest their stimulus in the stock market—despite current economic instability. Males were more likely than females to say they would be investing their stimulus funds, with many saying that investing the money will help them to “get ahead” later, and one explaining, “I believe the market will recover and I will make more money if I invest now.”
The ranking of what young consumers plan to spend their money on also includes an item that says a lot about what they see as necessities: video games. While some explained that they would be buying games or consoles to pass the time during quarantine, others actually do see them as essentials, with one 21-year-old male explaining, “I live and breathe video games.”