Pandemic has hurt financially but it's also caused more to save

Due to the impact of the COVID-19 pandemic on people's finances, around 145 million Americans say they cannot afford another year like 2020, according to WalletHub's new Coronavirus Money Survey, released today. This survey illustrates some of the ways in which COVID-19 has impacted Americans' lives and spending habits.

Below are additional highlights of the report, along with a WalletHub Q&A.

Key Stats

• Money problems are a huge source of stress. Money problems have now surpassed COVID-19 as being the top stressor in America, a 15% change since last year.
• The pandemic causes more need for credit cards. 29 Million more Americans say they will apply for a new credit card this year due to coronavirus, compared to last year.
• Women's spending has increased more. Women are 16% more likely than men to say they spend more money due to coronavirus.
• Many Americans have decided to start saving. 61% of Americans are saving more money during the coronavirus pandemic, rather than spending more.
• Touching cash is less scary. About 30% fewer people than last year believe it is possible to contract COVID-19 from money.

Q&A with WalletHub

How difficult was 2020 for Americans' finances?

"Financially, 2020 was such a difficult year that roughly 145 million Americans cannot afford another year like it," said Jill Gonzalez, WalletHub analyst. "Luckily, the U.S. is rolling out the COVID-19 vaccine, which will help conditions in the country approach normalcy more and more over the coming months. The American Rescue Plan, which comes with $1,400 direct payments, should also help ease the burden on people's finances this year."

How are consumers reacting to the coronavirus pandemic financially?

"One of the biggest ways that consumers have reacted to the COVID-19 pandemic is by opening more credit card accounts, as 29 million more Americans say they will apply for a card this year than last year," said WalletHub analyst Jill Gonzalez. "One positive way that consumers have reacted to the pandemic is by increasing the amount of money they save. Roughly 61% of adults say they are saving more, as opposed to buying more, due to COVID-19."

How are consumers feeling emotionally?

"The COVID-19 pandemic is now the second biggest stressor in America, with money problems taking first place," said WalletHub analyst Jill Gonzalez. "The U.S. is rolling out the COVID-19 vaccine and people have gotten used to social distancing measures, which explains why people are worrying a bit less about the pandemic itself. The long-lasting financial consequences caused by COVID-19 are now taking a more prominent position in people's minds."

Has the relief money provided directly to Americans been effective?

"The stimulus checks provided directly to Americans have been a big help during the COVID-19 pandemic. In fact, they led to record paydowns of credit-card debt in 2020, in addition to helping people keep up with other essential bills," said WalletHub analyst Jill Gonzalez. "The additional $1,400 checks provided through the American Rescue Plan should have a similarly positive impact."