6 financial tips during difficult times
You can plan and prepare for a lot of scenarios in life, but the first few months of 2020 have been an undeniable reminder and a sobering lesson of how quickly things can veer off course. With a big shift in day-to-day life, emotions and money are inextricably linked, so it’s understandable to be feeling on edge about finances.
While some things are out of our control, many are still well within our reins. During times of uncertainty, there are things you can do to anchor your finances, manage your anxiety and prepare for what’s ahead – like having a plan. Succeeding financially through these unusual circumstances may mean cutting back on the things you’ve been wanting to for a while or even shifting where your savings are going – there’s a silver lining in there.
Here are a few simple things you can do with your finances while we await a return to normalcy:
1. Spend some time rearranging and reprioritizing your budget
One of the upsides of social isolation is your bills for expensive coffees, gas and meals out are way down. This is a great time to make a spending plan (not a budget) because this will allow you to focus on things you can control and places you can save. Evaluate your bank accounts and spending to see if you can cut out some costs. Look at what you were spending (before social distancing was a thing) and put that money towards your debts or savings.
2. Get your emergency fund together
Given the situation, it’s important that you have at least three months of emergency expenses set aside. Even if you probably won’t need it, it’s always good be prepared. Make sure the fund is liquid and accessible. That doesn’t mean a stash of cash under your mattress, more like a HISA.
3. File your taxes
We officially have an extended deadline to file taxes (June 1, 2020). You will also not have to pay any balance owing until Sept. 1, 2020, and this also applies to installments for the 2020 tax year. Delayed filing means delayed refund, and if you owe, it’s better to know sooner rather than later so you can plan appropriately.
4. Embrace less meat
One of the biggest costs on your grocery bill is meat. While a plant-based diet is all the rage for health, even cutting out meat three meals a week can save you $30-50 on your weekly grocery bill. It isn’t much, but definitely adds up.
5. Shut out online temptation
With all this time on screens, you’re likely already being targeted with sales more than ever. With nowhere to go, you may be enticed to browse Amazon, but now is a great time to cut out as much online shopping as possible. Do an aggressive unsubscribe to retailers and influences currently tempting you to spend.
6. Give the car a rest
It’s not everyone’s first choice, but if you’re a two-car household and working from home you’re not using your vehicle nearly as much. This might be a good opportunity to save on insurance and maintenance. Park your car in the garage and once physical distancing measures are lifted, reinsure!
While working through all of this, it’s important to keep a clear mind and assess what your financial position is compared to where it was before the pandemic and where it could end up down the line.
It’s natural to have some financial regret about past spending, even more so to have anxiety about future finances, but if you’re armed with a little focus and proactivity, it’s also possible to feel more secure about your future. For the time being, be calm, understand where you are right now and prepare for what may come.