People earning less than $75,000 will receive a one-time cash payment of $1,200 as part of the $2tn economic plan to provide relief from the Covid-19 pandemic.
Individuals earning $75,000-$99,000 will receive a lower payment based on a sliding scale. But a look at household finances reveals that cash injection might not last long for those affected by the pandemic.
The Bureau of Labor Statistics (BLS) publishes detailed information about household spending; everything from pets ($55 a month on average), to fresh fruits ($27) and healthcare ($414). The data shows that the Covid-19 aid package would support the average person earning less than $75,000 for less than two weeks. The breakdown of an individual’s expenses looks like this:
There is a lot that goes into that “everything else” category including education, personal care, clothing and something still in high demand: alcohol.
Of course, these averages are a simplification of everyone in this income bracket because those earning less typically spend less too. And yet even those earning less than $15,000 still have average monthly outgoings of $1,653, meaning that the cash payment would tide over people in the lowest income group for less than a month.
Similar calculations can be made for couples who file their taxes jointly and earn less than $150,000. Under the terms of the bill, these couples would receive a cash payment of $2,400 and couples earning $150,000-$198,000 would receive a lower payment based on a sliding scale.
The result is still bleak. A $2,400 cash injection for US couples earning less than $150,000 would last less than two weeks. This, despite the fact that the economic effects of Covid-19 will last for months, not weeks.
