Financial Impact of COVID-19: Spending Habits | Personal Capital
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Post-Pandemic Spending Report: How COVID-19 Altered Financial Habits

Key Findings

  • 80% of Americans plan to continue at least one budget change in a post-pandemic world.
  • Throughout the pandemic, Millennials have been savers. 69% have saved more than $100 per month, and 20% have saved $500 or more.
  • Americans plan to redirect the extra money they saved during the pandemic into savings (51%) and paying off debt quicker than planned (30% overall, 34% Millennials).
  • 83% of Americans are excited to make a specific purchase during pandemic recovery. Read on to find out what they’re itching to buy.


With COVID-19 vaccines now widely available, we’re beginning to see clear skies ahead — and our spending is showing it.

Before March 2020, travel and restaurants accounted for 27% of spending for the average person who uses the Personal Capital Dashboard, according to anonymized spending data.*

After COVID-19 hit, consumers’ travel-and-restaurant expenditures dropped to 15% for the remainder of 2020.

Now in the first few months of 2021, vacationing and dining out are on the upswing. People are putting 17.4% of their spending toward these two long-favored spending categories.

Though a slight increase, it indicates a noteworthy cause: optimism.

At the same time, broader concerns over inflation may put a damper on spending. The U.S. government’s strategy for bringing back employment involves an anticipated inflation that “should fade over time as the economy recovers from the pandemic.”

“The economy is rebounding thanks to stimulus and COVID-19 vaccines,” said Lacey Cobb, CFP, director of advice solutions at Personal Capital. “During the pandemic recovery, there will be price spikes and likely a longer-term trickle-down effect. What people can do to protect themselves is ensure they have adequate emergency savings, continue contributing to their retirement savings vehicles, and spend within their means.”

Read More: The 50-30-20 Budgeting Rule: Is it Right for You?

A Post-Pandemic Wish List

The uptick in people’s spending corresponds to a recent Personal Capital survey conducted by the Harris Poll**: 83% of Americans are excited to make a specific purchase in a post-vaccine world.

  • 51% of respondents are looking forward to travel and vacations.
  • 34% (and 48% Gen Z) want to go shopping for new clothes.
  • 31% are eager for sports and concerts.

The biggest ticket items? Travel, cars, and homes.

Nearly 1 in 5 are looking forward to buying a car (17%), and over 1 in 10 want to purchase a house (11%, 21% Millennials).

Read More: Understanding PITI: How Much House Is Right for You?

A Look Back on How Pandemic-Era Cash Was Spent

Where did people’s money go over the past year?


In the early pandemic, home improvement expenses outweighed travel costs, according to Personal Capital platform intelligence.

Spending toward general merchandise (at places like Amazon, Costco, Walmart, and Target) ballooned over the pandemic, but it’s tightening up to pre-COVID levels.

People’s spending for groceries also spiked, but buyers appear to be aware that, indeed, their stockpile of staples is now sufficient.

After the first stimulus check payouts, consumers upped their spending in travel (though only slightly), restaurants, and home improvements. After the second round of checks, travel was most popular. Personal Capital proprietary data, updated monthly, has not yet indicated the impact of the third wave of stimulus checks.

The Role of Saving in Spending

For those fortunate to maintain disposable income amidst widespread job loss, building up savings has been one positive shift in personal finance habits.

Millennials, in particular, have shored up their savings: 69% have saved more than $100 per month, and 20% have saved $500 or more, according to the Personal Capital spending survey.

That could be because they’ve cut back on the fun funds. Overall, 86% of Americans have missed spending on at least one small splurge during the pandemic. Items topping the list include:

  • Going out for dinner (60%)
  • Concerts and events (40%)
  • Sporting events (31%, 40% Millennials)
  • Salon appointments (29%)
  • Shopping for a new outfit or shoes (25%)
  • Going out for coffee (24%, notably 31% of those who live in the Northeast)

Granted, a latte a week won’t likely break the bank. But these small savings could be put to good use.

“Invest,” said Cobb. “Start with your retirement accounts — a company 401k, a Roth IRA, a SEP IRA. Start early, save aggressively, and contribute as consistently as possible.”

Read More: How to Keep Track of Your Investments

Money Habits in a Post-Pandemic World

As optimism rises, Americans intend to carry forward healthy financial practices learned during the pandemic. 80% of survey respondents plan to continue at least one budget change they made during the pandemic after it’s over. This includes:

  • Reducing the number of meals eaten out (49%)
  • Purchasing fewer clothes and shoes (41%)
  • Traveling less frequently (37%)
  • Going to the salon less frequently (30%)

What do they plan to do with this money?

Of those surveyed by Personal Capital, 51% plan to redirect the extra cash they saved during the pandemic by putting it into savings; 30% intend to pay off debt quicker than planned.

Read More: What We Did With Our Money After Becoming Debt Free

People also aim to contribute more to retirement savings (16%) or investments (16%).

“What many don’t realize is that even the smallest changes can have a big impact down the road,” Cobb said. “Tax-deferred accounts can be a great way to let your money grow without impacting your taxable income. In addition to traditional retirement accounts, health savings accounts like HSAs and FSAs can be great tax management tools, too.”

The Other Side of the Coin

Of course, the pandemic has produced less rosy retrospection for households strained by job loss and other financial concerns.

Millions of American are still unemployed, and one survey by Money and Morning Consult found that one-third of respondents said their situation earlier this year was somewhat or much worse now than it was in February 2020.

For those who’ve been hit hard, 66% are excited to get back to positive habits they were not able to maintain during the pandemic — especially putting more into savings each month (35%, 43% Millennials), according to the Personal Capital survey.

These people are on the right track; Cobb recommends replenishing your emergency fund if it dwindled during the pandemic.

“We typically recommend three to six months of expenses in cash, but there isn’t a magic number to hit, as that number is based on your needs,” she said.

Additionally, 15% of survey respondents will be adding more to their retirement contribution and buying more investments. 22% of Millennials are excited to buy cryptocurrency.

Taking a Shot Toward Spending

For many, the possibility of getting vaccinated or already being vaccinated has changed their financial outlook.

One in three feel more optimistic about the economy stabilizing (32%). A quarter of respondents — and even more in younger generations — are ready to get back into their normal spending habits (36% Gen Z, 31% Millennials).

Though spending seems to be on track to normalizing, there’s room for improvement across financial wellness. Only 15% feel confident about their ability to save for retirement, while a similar amount of people (14%) say the same about investing.

Financial literacy — or the understanding of financial concepts and skills — is at the very core of gaining confidence, and learning how to control the controllable.

“When you understand finances, you begin to feel more confident about all of your financial choices,” Cobb said. “You no longer have to feel like you’re just guessing your way through managing your money. Instead, you know where you stand.”

* To obtain this data, Personal Capital collected the spending data of dashboard users on an anonymized basis from January 2020 through March 2021. All charts, figures, and graphs are for illustrative purposes only.

** This survey was conducted online within the United States by The Harris Poll on behalf of Personal Capital from March 18-22, 2020, among 2,002 U.S. adults ages 18 and older. Data is statistically weighted by age, gender, geographic region, education and race to ensure reliable and accurate representation of the total U.S. population, 18 years of age and older. This online survey is not based on a probability sample and therefore no estimate of theoretical sampling error can be calculated.

The content contained in this blog post is intended for general informational purposes only and is not meant to constitute legal, tax, accounting or investment advice. You should consult a qualified legal or tax professional regarding your specific situation. Keep in mind that investing involves risk. The value of your investment will fluctuate over time and you may gain or lose money.

Any reference to the advisory services refers to Personal Capital Advisors Corporation, a subsidiary of Personal Capital. Personal Capital Advisors Corporation is an investment adviser registered with the Securities and Exchange Commission (SEC). Registration does not imply a certain level of skill or training nor does it imply endorsement by the SEC.

Alicia Castro is the Managing Editor of Daily Capital.
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This year, my top financial priority is:

Building my emergency fund
Paying off high-interest debt
Budgeting better
Saving for a short-term goal, like a vacation or new car
Increasing my investment contributions
Maintaining status quo - I’ve got this under control

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