An American Century Investments news release said 27% of respondents were headed for the malls when the tax checks arrive, while another 25% reported they would save or invest the money. Some 36% said they would plough the funds back into their budget to pay down their debt.
Legislation passed by Congress would result in $600 checks being sent to individual taxpayers and $1,200 checks to joint filers, subject to overall income limitations. Among the survey’s other findings:
- Men are more likely to be aware of the rebate than women (89% vs. 79%).
- Increasing age was also associated with higher awareness. Ninety-six percent of those aged 65+ had heard of the possibility of rebates compared to only 63% of those under 25.
- Awareness is highest among those with income of $100,000 or more (90%), and lowest among those with incomes less than $25,000 (76%).
Men were more likely to plan to spend the rebate than women (31% vs. 22%), while women are more likely to use the money to pay off debt (42%).
The youngest (32% of those under 25) and the oldest (31% of 65+s) age groups were more likely than those in the middle to plan on saving or investing the money. Those in the 25 to 49 age group were most likely to use the rebate to reduce debt. In fact, more than half (51%) of 25 to 34 year olds would use the money to pay off debt. Finally, the largest portion (37%) of 65-plus group say that they would simply spend the rebate.
Individuals with only a high school education are less likely than college graduates to save or invest the tax rebate (18%).
Those with incomes of $100,000 or more are least likely to use the rebate to pay off debt (27%). Conversely, those with incomes less than $25,000 are least likely to plan to save or invest the money (19%) or to simply spend it (22%).
Of those who would save or invest the money from the economic stimulus tax rebates, almost half would put the money in a savings account. One-fourth as many report that they would put the money into a mutual fund. Additionally:
- Women are more likely than men to plan to put the money in a savings account (58% vs. 41%), while men are more likely to report a money market account (16%) or stocks (10%).
- Individuals under the age of 50 are more likely to put the money into a savings account (57%), while those age 50 or over are more likely to report using a mutual fund (21%).
- Those with incomes below $50,000 are most likely to put the money in a savings account (58%), while those with incomes of $100,000 or more are more likely to put the money in a mutual fund (25%). However, the largest portion (37%) of those with $100,000 or more in income still report they would put the money in a savings account.
“This survey indicates that there are people out there who recognize the value of socking away even a small amount of unexpected money,” said Jeff Benton, Senior Vice President, Direct Sales & Service with American Century Investments, in the news release. “The receipt of a tax rebate check might just be the catalyst some people need to start saving for retirement or funding a child or a grandchild’s education.”
Among survey respondents who indicated they would save or invest the rebate check, 47% said they would put the money into a savings account.
The e-Rewards Consumer Online OmniPulse is conducted once a week among a demographically representative sample of 1,500 U.S. adult panel members (age 18+) of the e-Rewards consumer online panel. Tax rebate questions were included in the poll for January 28.