Managing your finances during a pandemic can be overwhelming. During this trying time, it’s essential to focus on your unique financial journey, starting with the basics.
- Nail down your necessary expenses, and focus on costs like your home, electricity, and food. Postpone or eliminate non-essential spending.
- Reevaluate your spending plan. Put automatic recurring expenses on hold if possible.
- Find ways to save money. Redirect funds that were previously used for commuting/transportation, childcare, etc. towards payments or building up an emergency fund.
Determine your necessities
Having a solid idea of what your monthly necessities cost, can make all the difference. Calculate your bills that absolutely must get paid to maintain your health and wellbeing such as, rent, electricity, water, groceries, medications, etc. If your income is enough to cover your necessities – you’re in good shape.
Get real about needs versus wants. Determine if you are paying for services that you could live without. You need to eat every day of the week; you probably don’t need that trendy subscription box. Now is the time to prioritize your spending.
Ensure that your hard-earned money is going towards things that you often use, make you happy, and align with your values.
Be smart about debt
Be proactive when it comes to debt. There is nothing wrong with paying the minimum amount or skipping a payment (with your lenders permission, of course). If you’re still struggling financially, contact your lender’s to request a temporary forbearance or payment deferral. But make sure you understand the agreement before signing. Often while your payments are delayed, interest will continue to accrue, which could cost you even more in the long run.
It’s crucial to understand the ins and outs of temporary COVID-era relief options.
Let technology do the work for you. Set up automatic payments to make sure your necessary bills are paid on time every month. Automatic payments can also help you avoid any possibility of incurring a late fee.
It’s best practice to check in monthly to confirm that your automatic payments did go through. Also, re-evaluate automatic payments regularly. You may discover some monthly subscriptions that you’re paying for are no longer valuable to you.
Adapt to the new normal
Don’t overlook new found slack in your monthly expenses. Believe it or not, the pandemic has created an opportunity for people to save small dollar amounts. By spending more time at home and not commuting, we’re saving on public transportation, gas, and auto repairs. While parents keep their children home and out of expensive daycare programs – they’re saving. We’re also eating out way less often. All of these shifts add up to extra money that you can now put towards covering bills or into an emergency fund.
The pandemic has flipped the world as we know it upside down. We’re staying home more and spending less. Use this new normal to your advantage and modify where your money is going.
Learn to be content
Your income and expenses likely will not be similar to your peers – and that’s okay. Do not compare your financial situation to someone else’s; comparison will rob you of your joy and paycheck. Keep moving forward and doing what’s right for you.
We’re in the middle of a global health pandemic so, please give yourself grace. Your financial journey may not be easy. But as the Rolling Stones say, “No, you can’t always get what you want, but if you try sometimes, well, you might find, you get what you need.”
Here’s to staying home and reevaluating our budgets. Stay safe.