Less saving, less spending, more stock buying

Americans are putting more of their money into the stock market and putting less of it into savings accounts. They're also spending less on things like housing or basic goods and services, a new survey from the Conference Board finds.

What's happening: The survey shows a decrease in spending by consumers on all categories, with the exception of home improvements and decorating from the second quarter to the fourth quarter.

• No data were available for the third quarter.

Between the lines: The survey also found that spending on housing costs fell to a record low of 18% in Q4, down 3.5 percentage points from Q2, thanks largely to "plummeting rental rates in city centers, rent abatements and cuts, temporary rent and mortgage non-payments, and historically low mortgage rates."

• Along with housing savings, total spending on essential goods and services, such as food and beverage at home, routine transportation, education and medical fell 4.1 percentage points in Q4 compared to Q2.
• Consumers shifted their money largely to discretionary products like electronics and apparel. and of course the stock market.

The big picture: The Conference Board's U.S. Consumer Dynamics Report found that "pandemic-related forces—including more time at home, reduced opportunities to spend, and enhanced fiscal support from the government—continue to be the chief factors shaping consumer behavior in the United States."

Keep it 💯: "The booms and busts of a few unlikely ‘meme stocks’ have grabbed recent headlines, but the rise of individual investors tells a broader story about spending habits during COVID-19," said Denise Dahlhoff, senior researcher at the Conference Board.

• "Trends like low interest rates and declining debt concerns—alongside below-normal spending on vacations and out-of-home entertainment due to pandemic restrictions—have left a portion of Americans with more disposable income and fewer ways to spend it. Stocks, which continue to yield strong returns, have become an increasingly attractive option for these consumers."