Americans are stocking up on toilet paper again because of COVID-19: why it's bad

Stockpiling has become something of a national pastime, and fears of a second wave of the COVID-19 pandemic this winter only fuel the urge to stockpile. What can the desire to buy the most cost, the publication said USA Today.

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According to a December LendingTree study that polled over 1000 people about their shopping habits and plans, one in three Americans said they still plan to stock up on groceries. Another third of those surveyed said that they have already stocked up on food and household goods.

This is no longer surprising to shoppers who are once again faced with empty toilet paper shelves or continued restrictions from retailers such as Costco. They still restrict the sale of some high-demand items, such as Clorox wipes, to one pack per customer.

Stockpiling began with renewed vigor in October, when COVID-19 diseases began to rise, but since then, the pandemic has only worsened. Experts say stockpiling provides a psychological sense of comfort and preparedness during a crisis.

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“We're seeing it with hurricanes, blizzards, and we're seeing it with the pandemic,” said Matt Schultz, chief credit analyst at LendingTree. “Situations like this force people to take action to make sure they will be okay if the situation that happened in the spring happens again.”

But this stockpiling behavior can lead to some negative consequences, such as making it difficult for others to find basic necessities such as toilet paper and disinfectant.

Arrears

People who accumulate stock have a flip side to the coin: some of them spend too much money and run into debt. According to LendingTree, consumers say they've spent an average of $ 359 on inventory lately (up from $ 178 in the spring).

This creates a financial hole for some consumers as they accumulate credit card debt associated with stockpiling for the pandemic.

“It's important that people fight these impulses and urges to buy something and take a step back to understand what they need and what they don't,” says Schultz.

To be sure, Americans are spending more on groceries and cleaning supplies in general, but they are also cutting back on travel and dining out during the pandemic, said John Beerbaum, president of research and technology firm Highland. The study found that four in 10 Americans stay at home more often, and more than 6 in 10 are less likely to eat out.

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“This contributes to higher overall grocery costs,” Berbaum said.

No stocks for a rainy day

Another drawback: Nearly half of Americans surveyed by Highland said they ran out of emergency funds, and 8 out of 10 said they could not afford the $ 500 emergency spending. According to a study by the Federal Reserve System, about 4 in 10 consumers before the pandemic said they could not pay for the $ 400 emergency expenses without borrowing.

"Most Americans' financial margin of error is so small that that extra $150 to $200 they spend on supplies will already make it harder for some people to stick to their budget," Schultz says.

Before stockpiling, financial experts advise consumers to take a few steps to avoid cost overruns or debt.

• Budget for 2021

The end of the year is a good time to start budgeting if you haven't already, says Colleen McCreary, chief people officer at financial services company Credit Karma.

“This is the perfect time to think about your monthly expenses as a whole,” she notes. - Think about the habits you want to prioritize. Does it make sense to stockpile stocks? »

• Make a list before buying

Do not get carried away with shopping because there are few or other people grab them from the shelves. Prepare a list before heading to the store and stick to it.

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“People forget that they've stocked up before and may have already stockpiled some of the items they need,” McCreary says. “Don’t buy the biggest pack of toilet paper just because you think you’ll need it.”

• Don't forget to save money for emergencies

Financial experts point out that building or rebuilding your emergency fund should not be sacrificed for hoarding.

“People need to understand that they need to continue to build up their emergency fund,” Schultz says.

Even if it takes longer to pay off the debt, it is important to transfer some money to this account. Otherwise, he says, the next time you face an emergency, you may find yourself even more in debt.

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