Almost half of Americans used the $1,400 stimulus checks to pay off debt

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The third round of stimulus checks helped families with expenses and bills, but in particular helped them pay off debt.by Claudia Sahm, senior fellow at the Jain Family Institute and a former Fed economist. Sahm told Insider that paying down debt gives Americans more financial security and helps cut ongoing interest payments down the road. The checks not only helped Americans with outstanding bills but boosted the overall economy.

Sahm told Insider that these checks gave some families a financial cushion that they didn't have before, helping them pay for expenses or whatever else they needed the money for. To find out how people used the third round of checks, over 1,000 respondents were asked in a survey by the, whether they would use the money to mostly increase spending or savings or mostly to pay off debt.

Families largely negatively impacted by the pandemic also used it to pay debt. Among those noted as having a"thin financial buffer," 59% said they used the checks to mostly pay down debt.

 

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