We’re here to be real with you – managing your personal finances in 2020 has been HELL. There, we said it. No sense in beating around the bush when most everyone I know is struggling due to the economical crisis facing most Americans due to the coronavirus pandemic.
We aren’t naming names, but the photo above pretty much shows what the truth is. The pandemic and the economic crisis it created had more than 20.5 million Americans unemployed in May 2020. The unemployment rate was 14.4% in April, dropped to 13.0% in May, and currently hovers right around 8.4% as of September 4, 2020.
As a blogger, I have seen my income drop drastically, I have not even made 1/2 of what I earned last year, and there are only 3 months left in the year. Will I make that income up? I highly doubt it, and I’m sure many of you are wondering how you are going to be able to make ends meet as well.
The B Word
Yes, we’re going to say the B-word – Budget. However, in this instance we want you to think of budgeting in a positive light. Think of the things you truly value and want to save for. Or perhaps you want to quit smoking and want to know what you can save over a 5 year period. I am trying to quit and seeing it calculated out in front of me that I could have $23,522 sitting in a savings account versus chronic lung damage is indeed an eye-opener.
If you don’t know how to budget properly, that’s where Pigly comes in to help.
I personally love their Family Budget Planning Calculator. I mean you literally enter in your net weekly, biweekly, monthly or annual income to budget your expenses and it does the calculating for you! You can then go in and adjust the values to your personal needs. Budget-in-an-instant.
50 / 30 / 20 Budgeting
The calculator is based on a good general rule of thumb for starting your budget, which is the 50/30/20 method.
50% of Your Income for Needs – ideally this should be at most half of your income and would include food, clothing, transportation, utilities, child support, and alimony.
30% of Your Income for Wants – life is about living and if ever we needed to enjoy life it’s now. Here is where you put items such as dining out, subscription entertainment (Netflix, Amazon Prime Video, Hulu, etc.), vacations, toys, and other social activities such as concerts and movies – if we ever get back to being able to do those things.
20% of Your Income for Savings – it goes without saying that having some sort of savings to fall back on is necessary in an uncertain world. The pandemic has shown those without savings (and even those with) how vitally important it is to have several months of your monthly salary socked away for emergencies.
Quality Over Cost
This is something that took me a long time to realize. I would always buy the cheapest item instead of spending a bit more for the name brand item. No matter what I would buy, at a lesser rate, I ended up buying multiple times. If I had invested in the quality item, to begin with, I would have still been able to use it instead of replacing it.
STOP! If you spend your hard-earned money buying quality – you spend LESS because those items don’t need to be replaced as often and cost less to operate.
We’re talking about stuff you cannot go without. We all need food, clothing, a home, reliable transportation to get back and forth to work if public transportation isn’t an option for you. Be careful though – because wants can seep in and act like an essential, so it’s important to ask yourself if it is truly an essential or a want. For example:
Essentials would be:
- Healthy food
- Good-quality clothing
- A decent house or apartment
- A reliable car
These, on the other hand, are non-essentials:
- Junk food and restaurant food
- Designer clothing
- A mansion
- A luxury car
See what I mean? We aren’t saying you can’t have the wants – but only when your budget and income can allow for them. I mean, there’s no point in buying a mansion with a bowling alley if you have nothing left over after the mortgage is paid. That bowling alley is gonna get old really quick! Instead, use the calculator to determine what is a reasonable mortgage that you can afford.
Emergency and Contingencies
Regardless of what you may think, the real goal of budgeting your money is to help you grow an emergency fund – your cushion to fall back on, should the need arise, for unexpected life events such as unemployment or hospitalization. An emergency fund isn’t designed to take care of everything, but it is designed to help cushion the curveballs life throws at you and damaging your financial well-being.
There is no blueprint that says what you should store away for emergencies. The money experts agree on one thing – your emergency fund should be as big as possible! Low-income families should strive to have at least $2,500 in an emergency fund. Middle-income families should strive to have six times their monthly income.
Name Brand vs. Generic
I am the queen of generics if you ask my family. They see the packaging and go ewww and won’t even bother to taste it. Take it out of the packaging and serve it to them, and they never know the difference. They are conditioned to ‘want’ the name brand products.
Going generic is one of the best ways to cut down your grocery costs with minimal effort. It can get you a lot of savings if you choose the right array of products. This also saves income for things you buy in bulk. However, this isn’t the only way to save on groceries. Budget-conscious American shoppers have a broad array of options to slash their grocery bills by buying bulk, buying ugly produce (produce that is a little deformed in shape but still tastes the same), couponing, etc.
The appliances in your home, the smartphones, the televisions, they all consume power which raises your monthly bill. Did you know you can calculate how much energy an appliance uses? I calculated the cost of our microwave each year – $48.53.
Pigly even offers you the pros and cons of various fossil fuels and solar energy and can help you determine on a state-by-state breakdown where electricity costs the least and the most.
Seriously folks, all joking aside, we all need to tighten our belts and get our finances in order if you haven’t already. Pigly helps you manage everything – from how much your meat costs to utility bills, paying down debt, setting up a budget, figuring out what you can afford for a car loan – there is literally a calculator for everything on their website. All you need is to punch in some basic information and they do the rest for you.
There’s no login required, they aren’t asking you to buy anything, THEY JUST WANT TO HELP. So take a moment to visit Pigly and take a look around their website. You can also connect with them on Facebook and Twitter.
We know you’ll find it as interesting as we did and will incorporate their freely offered advice and calculators every month when working on your budget!