Savings And Credit Card Payments Captured 2/3 of Rebate Dollars

Savings And Credit Card Payments Captured 2/3 of Rebate Dollars

According to a recent Harris Poll, 45 percent of Americans believed that rebate checks would help stimulate the economy. Now that summer is over and the rebate checks are cashed, 52% of Americans say spending the checks did not stimulate the economy and only 37% say that it did.

Though 36% have spent at least some of their rebate, 38% indicate how they intend to spend more, suggesting promotional opportunities remaining to marketers. The nationwide Harris Poll of 2,710 U.S. adults includes other findings:

  • 52% of Republicans say rebate checks did stimulate the economy; 61% of Democrats and 56% of Independents say that it did not
  • In April, 73% of Americans predicted they would receive payment; 71 percent now say they did receive a rebate check
  • 70% of Americans with incomes of $34,999 or less and incomes of $75,000 or more say they received a check.
  • 86% of adults with incomes of between $35,000 and $49,999,and 87% between $50,000 and $74,999, say they received rebate checks

While the government hoped that the checks would be spent to spur the economy, the reality was different, notes the report.

April Expectations:

  • Americans said they would use some of the rebate to reduce their non-mortgage debt, paying off bills or credit cards (38%) or adding to their cash savings (35%).
  • One in five (21%) said would spend the money on other things they wanted to buy
  • Twenty percent said they would use the rebate to take a trip for leisure purposes
  • Seventeen percent said they would spend their money on home improvements while sixteen percent said they would use the money in restaurants and for dining out
  • One in ten said they would use the money for technology devices or entertainment events

August Actuals:

  • People primarily used their rebate checks to reduce non-mortgage debt such as paying off bills or credit cards (36%) and to add to their cash savings (29%)
  • One in five (21%) did actually spend the money on other things they wanted to buy
  • Just one in ten (11%) actually used the rebate to take a trip for leisure purposes
  • Americans spent their money on home improvements (14%) and in restaurants and dining out (12%)
  • Only five percent said they used the money for technology devices or entertainment events

As predicted, says the report, much of the rebate money ended up deposited in savings or being mailed to credit card issuers. Retailers did try their best to get some of the rebate money, but that did not end up occurring as much as they, and probably the White House, wanted.

With the economic uncertainty, Americans thought they would want to put away some cash and help reduce debt and that is exactly what they did. What seemed like a great economic fix in the earlier part of the year, though, has not panned out according to the results of the study.

The Extent To Which Respondents Agree Or Disagree With The Statement: "Spending My Tax Rebate Helped Stimulate The Economy." (Base: All Adults... % of Respondents)

 

April 2008

August 2008

Political Party

 

 

 

Rep.

 Dem.

 Ind.

Agree (NET)

 45%

37%

52%

29%

34%

   Strongly agree

9

6

9

4

6

   Somewhat agree

36

30

43

25

28

Disagree (NET)

 48

52

37

61

56

   Somewhat disagree

26

26

21

31

27

   Strongly disagree

21

26

16

30

29

   Not sure

8

11

11

10

10

Source: The Harris Poll, August 2008 (Percentages may not add up exactly to 100% due to rounding.)

 

Response To Actual Expenditure Question: "How Much Money Did You Use For The Following Categories?" (Base: Received Payment; % Of Respondents Receiving Payment;; % Of Dollars Received; Compared to Anticipated Expenditures)

 

Will spend at least some of rebate (NET)

Did spend at least some of rebate (NET)

Indulged in a spa treatment

2%

1%

Invested in stocks or mutual funds

4

2

Paid down mortgage debt

5

5

Funded education for yourself or your family

6

3

Donated to charity

8

4

Spent on entertainment events or devices

10

5

Spent for technology devices (i.e. computer, TV, etc.)

 10

7

Spent on restaurants or dining out

16

12

Spent on home improvements

17

14

Took a trip for leisure purposes

20

11

Spent on other things you have wanted to buy

21

21

Added to your cash savings

35

29

Reduced non-mortgage debt, paying off bills or credit cards

38

36

Source: The Harris Poll, August 2008 (Percentages may not add up exactly to 100% due to rounding. Dollar amount recalculated as a percentage of overall dollars spent.)

For additional charts and more detail about the study, please visit Harris Interactive here.

 

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