Travel down, home improvement up as spending shifts while we stay at home
Posted May 14, 2020 4:45 p.m. EDT
Updated May 14, 2020 5:03 p.m. EDT
As we all know, spending habits have changed while a large percent of the population has been staying home during the pandemic. Check out how drastic those changes have been according to a new analysis from North Carolina financial cooperative Coastal Credit Union.
How Has Our Spending Changed During Quarantine?
By: Joe Mecca, VP of Communication, Coastal Credit Union
It’s fairly easy to observe how much our spending habits have changed as we’ve all adapted to being quarantined at home and having our favorite stores and restaurants closed or restricted. We can see packed parking lots at local home improvement stores, and delivery trucks making frequent stops in our neighborhoods. On the other hand, very few of us have boarded a plane in the past couple months, nor seen the inside of a restaurant. But, have you wondered what that looks like on a more widespread scale, or how drastic those changes have actually been?
Doreen Brown, VP of Cards for Coastal Credit Union in Raleigh, recently performed an analysis of credit card and debit card spending trends among the credit union’s members during April. Some of the numbers are pretty staggering.
“While the data is specific to card usage by Coastal members,” says Brown, “we believe the numbers provide a representative snapshot of what’s happening throughout the Triangle.”
For example, spending on travel was down by 80% from a year ago, as spring break plans gave way to stay-at-home orders. Additionally, as those orders restricted eateries to delivery or take-out only, spending at restaurants dropped by 60%. Interesting to note, while overall restaurant spending was down significantly, the average purchase amount rose by 23%, likely a result of delivery fees, tips and minimum purchase amounts.
With fewer places to travel to, fuel spending has plummeted, too. Overall fuel spend fell by 40%, with the average purchase amount dropping, as well, compounded by lower gas prices.
Despite all this being caused by a disease, healthcare spending was also down significantly, dropping as much as 30% from 2019. While the average healthcare purchase amount hasn’t changed, people are putting off all but essential or emergency care.
Generally speaking, a change of more than a few percentage points will raise eyebrows around a conference table – or lately, a WebEx meeting. Seeing percentages in the high double-digits is usually unheard of. Not all the change has been negative, either. A few commercial sectors are enjoying a steep increase in business.
We all still have to eat. So, while restaurant spending has dropped, grocery sales have risen sharply. Not only are shoppers spending more overall, they’re buying a lot more per trip, with the average grocery receipt totaling as much as 30% more. And while we’re at home, we’re tackling a lot of projects around the house and yard. Home improvement spending increased by 23% over last year.
Even though we’re visiting our own doctors less, we’re looking after the well-being of our furry friends more. Spending on veterinary services increased by 3% over last year.
While all these numbers are interesting, they don’t come close to the biggest change. Shoppers have migrated to online purchasing and home delivery by record amounts. Coastal reports that its members have increased what they’re spending at Amazon by 90% over last year, both in terms of how much they spend, and how many transactions they’re doing.
What does that mean for the road ahead? In many ways, it’s too early to tell. As more businesses are allowed to reopen and people are able to spend more time away from home, we’ll likely see restaurant, grocery and home improvement numbers start to head back toward normal. Fuel spending will likely get back to normal, too. What will be interesting to watch, though, is how long it will take travel spending to recover, and if the online shopping increase is here to stay.
About Coastal Credit Union
Coastal Credit Union is a not-for-profit, member-owned, financial cooperative, offering a full range of financial products and services. Today, with $3.6 billion in assets, Coastal serves 270,000 members from 1,700 business partners and is among the leading financial institutions in North Carolina. Coastal operates 24 branches in central North Carolina and serves members in all 50 states through a network of 5,000 shared branches, 80,000 surcharge-free ATMs, mobile banking featuring mobile check deposit, and a robust offering of online services at www.COASTAL24.com.
About Joe Mecca
Joe is Coastal’s VP of Communication. He serves as company spokesman, and is integral to the credit union’s public relations and corporate communications, so he loves to keep members and employees in the know. A self-proclaimed personal finance nerd, Joe will gladly talk your ear off about spending plans, spreadsheets and anything else money related.