Research: The Pandemic Changes How Americans Think About Money

Debt.com and HerMoney asked more than 1,000 adults if COVID-19 has made them more financially responsible. The answer was a resounding yes – even for those who have lost no income.

The pandemic has had such a major impact on Americans’ finances and psyche that even those who didn’t lose part of their income are now rethinking how to approach spending and saving.

More than two thirds of respondents to a new Debt.com/HerMoney.com poll say they’re spending much less than during the pandemic – and includes those who haven’t suffered any income loss.

For this survey, Debt.com partnered with HerMoney.com, a digital media company focused on improving the relationships women have with money. The most dramatic result came from the most basic question: “Has the pandemic changed how you think about money?” For those who lost money in 2020 – from a quarter of their income to all of it – just over 70 percent responded that the pandemic had indeed changed their thinking in “profound ways.”

But the most dramatic result was from respondents who haven’t lost money: an astounding 50 percent also say the financial ramifications of COVID-19 has changed how they think about money in “profound ways.”

Why would the pandemic change so many minds even among those who have lost nothing, compared to those who have lost something or even everything?

HerMoney.com founder Jean Chatzky thinks she knows why: “Sometimes the fear of losing something is more overwhelming than the actual loss when it happens. So those who are worried they might be next are the ones who are preparing now for the worst.”

The other results were equally compelling…

More Americans are budgeting since the COVID-19 outbreak

Sticking to a budget is now more important

Nearly half said they’ve cut spending by a fourth

Three out of ten say they’re now interested in buying pre-owned big-ticket items

More of those who lost money now pay attention to interest rates on their credit cards

More Americans understand the importance of an emergency fund

More than a quarter of all respondents are paying more attention to retirement savings

Slightly less than half feel their financial situation will improve under the Biden administration

Survey results for all respondents, click here

Have you lost income during the pandemic?	Percentage of respondents
Yes, we’ve lost all our household income	2.82%
Yes, at least half of my household income	8.18%
Yes, at least a quarter of my household income	23.40%
No, I did not lose any household income	65.60%

Has the pandemic changed how you spend money?	Percentage of respondents
Yes, I’ve cut at least half of my spending	13.21%
These days, I only buy bare necessities	18.69%
No, I still spend the same	19.67%
Yes, I’ve cut spending by at least 25 percent	48.43%

Has the pandemic changed how you handle money?	Percentage of respondents
Yes, I’ve never made a budget but do now	11.02%
No, I never had a budget and still don’t see a need for one	11.12%
I don’t currently have a budget but now see why it’s important	20.94%
No, I had a budget and still use one	27.66%
I’ve never stuck to my budget in the past, but do now	29.26%

Has the pandemic changed how you think about money?	Percentage of respondents
No, my attitude about money is the same	42.52%
Yes, in profound ways	57.48%

If the pandemic has changed how you think about money, which of the following apply?	Percentage of respondents
I’m not ignoring my retirement savings anymore	14.88%
I’m paying more attention my credit card interest rates	18.77%
I’m more willing to buy used cars and other pre-owned big-ticket items	19.94%
I now realize how important it is to save for emergencies	46.42%

Do you think your financial situation will improve under President Biden?	Percentage of respondents
No	23.14%
I think it will stay the same	31.96%
Yes	44.90%

Those who have lost income due to the pandemic, click here

Have you lost income as a result of the pandemic due to:	Percentage of respondents
Job furlough	26.16%
Taking a pay cut	32.27%
Job loss	41.57%

Has the pandemic changed how you spend money?	Percentage of respondents
No, I still spend the same	5.44%
Yes, I’ve cut at least half of my spending	21.49%
These days, I only buy bare necessities	27.79%
Yes, I’ve cut my spending by at least 25 percent	45.27%

Has the pandemic changed how you handle money?	Percentage of respondents
No, never had a budget, still don’t see the need for one	6.40%
Yes, I’ve never made a budget but do now	16.57%
No, I had a budget and still use one	18.02%
I don’t currently have a budget but now see why it’s important	21.22%
I’ve never stuck to my budget in the past, but do now	37.79%

Has the pandemic changed how you think about money?	Percentage of respondents
No, my attitude about money is the same	29.39%
Yes, in profound ways	70.61%

If the pandemic has changed how you think about money, which of the following apply?	Percentage of respondents
I’m not ignoring my retirement savings anymore	26.92%
I’m paying more attention my credit card interest rates	37.41%
I’m more willing to buy used cars and other pre-owned big-ticket items	38.11%
I now realize how important it is to save for emergencies	83.92%

Do you think your financial situation will improve under President Biden?	Percentage of respondents
No	21.84%
I think it will stay the same	24.71%
Yes	53.45%

Those who haven't lost income due to the pandemic, click here

Has the pandemic changed how you spend money?	Percentage of respondents
Yes, I’ve cut at least half of my spending	8.92%
These days, I only buy bare necessities	13.97%
No, I still spend the same	27.04%
Yes, I’ve cut spending by at least 25 percent	50.07%

Has the pandemic changed how you handle money?	Percentage of respondents
Yes, I’ve never made a budget but do now	8.10%
No, I never had a budget and still don’t see a need for one	13.61%
I don’t currently have a budget but now see why it’s important	20.80%
I’ve never stuck to my budget in the past, but do now	24.77%
No, I had a budget and still use one	32.72%

Has the pandemic changed how you think about money?	Percentage of respondents
No, my attitude about money is the same	49.33%
Yes, in profound ways	50.67%

If the pandemic has changed how you think about money, which of the following apply?	Percentage of respondents
I’m not ignoring my retirement savings anymore	25.73%
I’m paying more attention my credit card interest rates	30.25%
I’m more willing to buy used cars and other pre-owned big-ticket items	33.18%
I now realize how important it is to save for emergencies	80.36%

Do you think your financial situation will improve under President Biden?	Percentage of respondents
No	23.81%
I think it will stay the same	35.71%
Yes	40.48%

Methodology: Debt.com surveyed 1,064 people and asked 12 questions about how the COVID-19 pandemic has impacted their earnings and spending. People responded from all 50 states and Washington, DC and were aged 18 and above. Responses were collected through SurveyMonkey. The survey was conducted from Nov. 12, 2020 to Dec. 5, 2020.

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