- COVID-19 has wreaked havoc on the economy
- Millions are out of work with no end in sight
- Changing your habits can make a big difference
During difficult economic times, people seek to tighten their belts and look for ways to save money where they can. Here are some ideas for keeping more money in your pocket.
1. Limit monthly, recurring expenses
With expenses on the rise and salaries stagnant, it is always a good time to reassess living expenses. Chances are rent is pretty set, but especially with COVID-19 rearing its ugly head, some landlords are offering discounts or deferrals. If you’re keeping your money in an interest-bearing account, it might be beneficial to keep your money if your landlord is willing to wait. Monthly cell phone, internet, and utility bills may be negotiated as well.
More easily adjusted, though, can be discretionary purchases. Clothing items can be mended instead of replaced, shoes can be resoled in many cases, and friends are often open to a clothing swap since they will benefit as well. Entertainment costs can be limited, especially during quarantine, since there isn’t anywhere to go anyhow. Stay home, pop some popcorn, and indulge in a movie on a free streaming service or something you already subscribe to.
2. Make a Financial Plan
If you haven’t already, work out what your financial goals really are. Working without a plan can lead you to spend all of your money that’s left after basic bills are paid, but you can make a plan and save towards a real goal. When you start saving for retirement early, you’re more likely to reach your goals, and stay on track, and you also have that money to borrow against if you’re ever in an emergency.
Want to splurge on an expensive bag, car, or other item? First, consider whether you could make do with a less expensive version of the item. If not, set a savings goal for yourself along with a reasonable time frame. Then make that goal a reality using every means at your disposal. Set up a savings account, make regular payments, automatic if possible.
3. Monitor Your Meals
Ordering out daily is a big drain on finances, and making meals at home can save a bundle. While buying organic can be pricey, and it takes planning out and time, it is often less expensive to purchase groceries and cook. Set aside a few hours during the week to meal plan, deciding what you’d like to eat and when. Saturday or Sunday afternoon, make it an adventure to cook up some meals for the week. With a family or without, putting in time is an investment in yourself.
When you make your own lunch and dinner, you eat out less, by definition spending less money each day on consumables. Who hasn’t gone for lunch at work, and picked up a pack of gum as well? There’s the opportunity to streamline all spending when you start brown bagging it.
4. Stop Using Credit Cards & Pay Down Debts
Paying interest on credit cards is throwing money away. What are some ways to save money? If you don’t have to, don’t carry balances on credit cards that charge interest. It’s always good to have a credit card as an emergency backup, but charging frivolous purchases is not a good idea.
Putting money each month to pay off student loans can also feel draining. But if you incurred the expense, it’s your responsibility. Keep paying them off, but recognize that during COVID-19 there may be breaks in your repayment requirements. Keeping abreast of current situations and knowing what is affecting your finances is the single most important thing you can do.
5. Have a Full-On No-Spend Experience
What are some more ways to save money? Don’t forget the power of money. While it can make you feel powerful to spend, it should make you feel equally as powerful by not spending. A No-spend day/week/month/year can save you tons. Decide what you will spend on, for example rent, medical bills, student loans. See about a deferral or hiatus available for any or all of your bills while the world readjusts to COVID-19.
No-spend is a mindset as much as anything else, and it can help to treat it as a game. Can you purchase nothing for a day? Two days? What will you do with the money you’re saving instead of spending?
It can be a real challenge, especially during times of pandemic, civil unrest, and economic insecurity, to retain focus. But if your goals are clear, you will find it easier to meet them. If you have a specific plan in place, it is easier to follow than if you try to do things piecemeal. Keep your eyes on your goal, and plan for whatever future you’re looking forward to!