News

Locals say they'll save, pay 'boring' bills with rebate checks

By Katie Curley and Stephen Tait
Staff Writers
Published: May 1, 2008

NEWBURYPORT — As economic stimulus checks start showing up in bank accounts, some residents say the money will not provide the economic jump start the government is hoping for.

Most people asked yesterday how they will spend the money said they will be saving or paying off debt rather than hitting the shopping malls.

"I'm going to put gas in my car and maybe put a little toward home repairs," said Linda Desse, 67, of Amesbury. "There is a myriad of things. We are driving cross country this summer, too; not the best time to do it though."

Economic stimulus payments began going out earlier this week.

The rebates, which are expected to go to 130 million households, range up to $600 for individuals and $1,200 for married couples, plus $300 per child for eligible parents.

How you receive the rebate depends on how you filed your taxes.

The exact timing for both direct deposits and paper checks depends on the last two digits of the main tax filer's Social Security number. The IRS Web site says those with Social Security numbers ending in digits between 00 and 20 who filed their taxes with direct deposit refunds will have the payments transmitted to their accounts no later than tomorrow, May 2. Numbers 21 through 75 will go out by May 9, and 76 through 99 by May 16.

Paper checks will go out beginning May 9 and continue weekly. The last batch, numbers 88 through 99, will be mailed no later than July 11, the IRS site says.

In an Associated Press-AOL Money & Finance poll earlier this month, 35 percent said they would use their regular tax refunds for bills and credit card payments, up from 27 percent who said that a year ago.

With consumer spending screeching to a halt in recent months, the retail industry needs shoppers to splurge. But with gas predicted to reach $4 a gallon by summer and a gallon of milk now costing an average of about $3, local residents will be using their refund frugally.

Tom Gynan, 20, said he is putting his money right into the bank.

"I'm probably just going to save it," said Gynan, who grew up in Amesbury and Newburyport and now works in construction. "I've got two kids; I need all the money I can get."

"I'm paying off bills," Newburyporter Cathy Lane said. "Boring, boring, boring."

Noting the irony, Lane said that she will use some of the money to pay for the services to get her taxes done and also to pay off some "store charges" that come with high interest rates.

After that, she says most of the money will be gone.

"There is nothing exciting about it," she said.

Retailers have already tried to grab a share of the billions of dollars flowing to households. Sears Holdings Corp. is offering discounts and freebies to shoppers who convert rebate checks into gift cards. Home Depot Inc. launched a campaign urging people to spend on eco-friendly products like energy-saving light bulbs.

Judy Letener of Park Circle in Newburyport, a Market Basket employee, said the only exciting thing she would be using the check for is to buy a new washer and dryer.

Yesterday, as Keith Fufure, the manager of GNC Vitamins off Storey Avenue, stocked shelves, he thought about that he would do with the money.

"I will be banking it," Fufure said. "I think that's the best thing to do with the economy like it is."

Meg Richardson, who is the manager of the Book Rack at the corner of State and Pleasant streets, said she is going to do with her money what most plan to do: "I think I'll just put it in my savings or may get a little ahead of my other bills."

Richardson said at the heart of the problem is the philosophy behind the tax rebates. She said the country would have been better served if President Bush put the money toward new jobs, retraining for those who need employment or for increasing manufacturing.

"I don't think that saving the economy by consumer spending is a good thing," she said. "It is not long-term thinking. It is emergency thinking."

Direct Deposit Payments

If the last two digits of your Social Security number are, payment will be transmitted by:

00-20 May 2

21-75 May 9

76-99 May 16

Paper Checks

If the last two digits of your Social Security number are: Checks will be mailed by:

00-09 May 16

10-18 May 23

19-25 May 30

26-38 June 6

39-51 June 13

52-63 June 20

64-75 June 27

76-87 July 4

88-99 July 11

Courtesy the Internal Revenue Service more information is available at www.irs.gov