As Congress continues to grapple with a follow-up relief package to the CARES Act, there’s one thing that Republicans and Democrats seem to agree on: however the final bill will end up looking, it is all but certain to include a second round of stimulus checks for 100+ million Americans.
The CARES Act, passed on March 27, provided Economic Impact Payments of up to $1,200 per adult to individuals whose income was less than $99,000 ($198,000 for joint filers) and $500 per child under 17 years old – or up to $3,400 for a family of four. According to a statement from IRS Commissioner Charles Rettig, 160 million payments worth a total of $270 billion had been made by the end of June, and it is believed that the stimulus checks played a vital role in cushioning consumer spending amid the unprecedented jobs crisis.
As the following chart, based on data from the U.S. Census Bureau’s Household Pulse Survey, shows, the stimulus payments were used to pay for a wide range of things, with essentials like food, utilities and household supplies on top of the list. Combined with the fact that only few Americans used the windfall to buy non-essentials like recreational goods and electronics or even to build up savings, this goes to show that the federal checks were crucial in enabling affected households to pay their bills. As the weekly $600 in additional unemployment benefits ran out this week, with no compromise on a possible extension found yet, millions of Americans will be hoping for a quick arrival of the second round of stimulus payments to give them a hint of financial security in these difficult times.