The pandemic is changing everybody’s lives. But just because the world around us is chaotic doesn’t mean your budget has to go into the red. We’ve gathered our best money-saving tips to help you stay calm, cool, and collected during these uncertain times. Keep reading for our best budgeting tips.
Don’t be hasty with your investments
If you have stocks but you’ve seen them drop in recent days, it’s wise to reach out to financial advisors from trusted companies, like broker dealers from Cetera. A financial expert can help you strategize your stocks and investments to limit the damage a downturn in the markets can have on your nest egg. It’s important not to make rash decisions on your own so you avoid losing money unnecessarily.
Set realistic goals
If you’ve just lost your job or your partner has lost his or her job, your large savings goals probably aren’t going to happen in the short term. Instead, consider setting more realistic goals for the short term. For example, can you put away an extra $100 a paycheck for an emergency fund? Can you pick up a side hustle?
Look closely at your cashflow
When you’re ready to get serious about your budget, consider writing out a list of your earnings and your expenses to track your finances. You can separate out your variable expenses and fixed expenses that you must pay each month.
Examples of fixed expenses include:
- Student loan payments
- Auto loan payments
- Auto insurance premiums
- Utility payments
- Electricity payment
- Internet bill
- Phone bill
Your fixed expenses will be about the same each month. However, your variable expenses and discretionary spending is where you should be looking to cut back. Here are a few examples of places in your budget where you can cut down on spending:
- Eating out
- Entertainment expenses
Don’t move money from your 401k
If you contribute to retirement funds, don’t stop doing so in the face of an economic downturn. Typically, these drops in the market are temporary, so it’s not smart to suddenly stop contributing to your retirement. Investments should be looking at the long-term, not reacting to short-term changes. Unless your retirement horizon is in the next few years, you shouldn’t change any of your 401k settings.
Pause your financial goals
If you’ve been saving up for a big vacation or for a new car, you’re probably going to have to wait on making the jump. While it might be a little disappointing, being smart about your money will help you recover faster and close in on that savings goal a little later.
Instead, consider putting away more money into your savings funds so you can pay for emergency, life-sustaining expenses instead. After all, you never know when you could lose your job or have a medical crisis.
End your subscriptions
Although Netflix or Hulu are awesome time-fillers, you don’t really need them. Considering using an app like Trim to find all your recurring subscription costs and then eliminate the ones you don’t need or use. Maybe you have a monthly gym membership – but if you never find yourself at the gym, it’s a good idea just to cancel it.
Instead, consider doing free at-home exercises like yoga at home or riding a bike outside.
Consider changing your mode of transportation
Using your personal car constantly can mean you spend a lot of money. Maintenance, gas, registration, insurance – those costs can really add up! If you commute by car to work, consider using public transportation instead or commuting by bike. Or, you can do a combination and take the train part of the way and bike the last segment.
Saving money during uncertain times can be difficult, especially if you’re dealing with the loss of a job or another traumatic event that upends life as you know it. With that said, if you approach your money with a strategic mindset, you can gain control of your finances. It’s important to set a budget in place and cut back on discretionary spending across the board. It’s also a good idea to put more money away into your emergency fund. With these tips, you’ll be on your way to financial freedom faster than you know it.