Personal Finance

Consumer Behavior in the Wake of the Pandemic

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Since the onset of the coronavirus pandemic, 78% of Americans have changed the way they spend their disposable income. Savings rates are at an all-time high at 33% – the highest level since the U.S. Bureau of Economic Analysis began tracking in the 1960s. Spending has decreased by a record-breaking 13.6% for the month of April1.

  • 115,000 Americans have died from COVID-192
  • 33 million Americans have filed for unemployment3
  • Over 100,000 small businesses have permanently closed4

As a result, many Americans have changed the way they budget, shop, and work. Some activities – like working from home and buying groceries online – may fade after COVID-19. Others, like banking, are likely to change permanently.

Consumers were already changing their habits before COVID-19 swept across the planet. For example, Millennials made 60% of their purchases online in 2019, up from 47% in 20175. But the pandemic quickened the pace of this structural shift.

In 2019, millennials only made 40% of their purchases in brick-and-mortar stores, down from 53% in 2017.

In this article, we’ll describe some of these consumer behavior changes and whether they will persist post-pandemic. We’ll also suggest smart moves you can employ when managing your money.

Americans Are Worried About Their Finances

Seventy-five percent of Americans look at finances negatively; money has globally become the second-biggest worry for people, with health taking the top spot. When Americans recently had the opportunity to choose a word to describe their feelings toward their money, 46% of them chose “worried.” Thirty-nine percent chose “nervous” to describe their feelings about their finances6.

Will this continue past the pandemic?

Many behaviors will persist. Economic recovery depends on whether the increase in savings is due to shutdowns or structural changes in consumer habits. Changes are also partly due to unemployment; once the economy rebounds and hiring increases, people will start to grow more confident in spending.

The Smart Move.

Whether the economy is thriving or not, saving money is always a good idea. Consumers should consider opening a high-yield savings account to maximize potential financial growth. UFB Direct (our sister bank) has savings accounts currently offering some of the highest interest rates in the nation.

The COVID-19 pandemic has shown us economic conditions can change on a dime, and future financial wellbeing is never certain. Having a sizable emergency fund will allow you to ride out any economic storm and provide peace of mind, flexibility, and security in unforeseen circumstances.

Cash Is No Longer King

The use of cash has been declining for years, and the pandemic has hastened that decline. With shelter-in-place orders in effect and non-essential businesses closed, many consumers turned to online shopping for goods – and with online shopping, coins and bills have no place.

Over the course of the pandemic, there has been a 57% fall in cash usage among respondents of a recent EY survey.

For purchases at brick and mortar stores, the preferred payment option – up by 34% – is contactless payment. Moving forward, two-thirds of global consumers plan on using contactless payment instead of cash7.

Will this continue beyond the pandemic?

Yes. Cash is inconvenient to carry, difficult to track, and dirty. The fact that the coronavirus (and other viruses and bacteria) can cling to surfaces has all but doomed the future of physical cash. As convenient digital banking services increase, the usefulness of cash continues to wane.

The Smart Move.

Stay cashless. Use your mobile banking app to track where your money goes, and use contactless payment options for in-person purchases. This allows you to manage your money more effectively and spot areas where you’re not spending according to your goals.

Americans Are Getting Errands Done from Home

The pandemic led to an increase in U.S. e-commerce by 49% in April. 21% of Americans say they have ordered groceries online or through an app because of the COVID-19 outbreak; online book sales have doubled, and digital electronic sales increased 58%8.

Will this continue past COVID-19?

This trend is likely to continue, especially with errands that are unenjoyable, like driving to an ATM or bank to deposit a check. Institutions are finding ways to digitize more analog processes – everything from simple account withdrawals to home equity loans – to meet consumer demand for full-service banking from home.

The Smart Move.

Bank at a safe distance. New mobile banking registrations rose 200% in April, while mobile banking traffic rose 85%9. Much of this uptick is due to pandemic-related lockdowns, leaving many branches closed and no tellers available.

Looking to the post-pandemic future, only 40% of consumers say they expect to return to bank branches, signaling that this surge in digital banking will likely become permanent.

Using a mobile app lets you bank from anywhere at any time, and there’s no waiting in line, giving you more free time to spend at other places. Many banks (like Axos Bank) allow you to do every aspect of banking from home.

Post-Pandemic Money Management

The COVID-19 pandemic has changed the way people handle their money. While Americans are saving more of their disposable income, banks are seeing huge upticks in account logins, remote deposits, and online account openings. Shopping from home is at an all-time high, and more people are using contactless payment than ever before.

Making the switch to digital banking is a smart move to easily and safely manage finances, track spending, and grow your savings with a high-yield savings account. While some degree of normalcy is bound to return as stores reopen and people become comfortable again, many lifestyle norms may vanish into pre-pandemic history.


1. Fitzgerald, Maggie, "U.S. savings rate hits record 33% as coronavirus causes Americans to stockpile cash, curb spending",, May 29, 2020.
2. "Coronavirus Disease 2019 (COVID-19) – Cases in the U.S." U.S. Center for Disease Control, June 16, 2020.
3. Cohen, Patricia and Hsu, Tiffany, "'Rolling Shock' as Job Losses Mount Even With Reopenings", The New York Times, June 11, 2020.
4. Guzman, Joseph, "More than 100,000 small businesses have permanently closed due to coronavirus, study estimates", The Hill, May 13, 2020.
5. "Millennials now do 60% of their shopping online", Digital Commerce 360, March 26, 2019.
6. "N26 Finds Only 27 Percent of People Globally Feel 'In Control' of Their Finances", Cision PR Newswire, March 27, 2020.
7. Bellens, Jan, "Four ways COVID-19 is reshaping consumer banking behavior", EY, May 8, 2020.
8. Perez, Sarah, "US e-commerce sales jump 49% in April, led by online grocery" TechCrunch, May 12, 2020.
9. Sheng, Ellen, "Coronavirus crisis mobile banking surge is a shift that’s likely to stick",, May 27, 2020.

Consumer Behavior in the Wake of the Pandemic

This blog post was published by Axos Bank on July 23, 2020 and last updated on July 24, 2020.

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