You’ve heard a lot of words over and over again that describe the past few months: unprecedented, new normal, trying, uncertain. It doesn’t look like we’ll return to life as we knew it before COVID-19 anytime soon, and that can be a very frightening thought, especially if your circumstances, income, or job have been altered by the global pandemic. Many Americans are concerned about the economic outlook moving forward, and what it means for their families. Scary as it may be, now isn’t the time to panic. It’s time to plan.
Set a budget.
Most of us are concerned about our income and cashflow right now. It’s only natural given the grim news about the economy that plays on repeat on the news. The best way to fight fear is with knowledge. If you haven’t created a budget, now is the time to sit down with all your bills for the last six months and see where every penny has gone. Don’t leave out any trips to Starbucks or Whataburger, even if it’s just a few dollars. Use a spreadsheet (or pen, paper, and a highlighter) and categorize your purchases. That way, you’ll be able to easily see how much your basic needs, like housing, utilities, medicine, and food cost, and work from that number to determine how much money you need to bring in each month.
Once you’ve developed a budget you can live with, meaning it provides some wiggle room for a higher-than-average electric bill, or the occasional pizza when you can’t handle cooking one more day, you can evaluate how much you can save. Even if it’s $50 a month, sometimes just starting is the most difficult part of saving. At Lone Star Credit Union, we can help you set up an automatic deposit from your checking account to your savings, ensuring you never forget to stash some money away for a rainy day.
Evaluate your savings.
Now that you’ve set a budget, it’s time to evaluate your current savings. Did you know that 28% of Americans have no savings at all, while 41% could not cover an emergency expense of $1000? If you have secure income, now is the time to buckle down and make saving a priority.
- Reduce or eliminate takeout. We’re all sick of cooking at home (and emptying the dishwasher three times every day!) but reducing the amount you spend eating out can really add up. Try this saving tip: every time you decide to eat at home rather than ordering Uber Eats or a pizza delivery, move that money into your savings account.
- Try discount stores or couponing. Shopping somewhere like Aldi or WinCo can really add up to big savings! You could even compare your total at a discount grocery store to what you might have spent elsewhere and move the difference into savings.
- Use apps that pay you. Apps like Fetch Rewards give you points for uploading receipts. Cash out those points for gift cards to stores you already visit or buy a gift card for pizza delivery and pay $0 for your Friday night family pizza!
Set a savings goal.
The common savings recommendation is to have six months of income stashed away for a rainy day. However, that figure can be very intimidating, especially if you’re starting at zero. Add in saving for retirement and college, and the prospect of saving anything at all can be very discouraging. Instead of giving up before you even start, try setting a small savings goal. Remember the statistic that 41% of Americans can’t cover a $1000 emergency? Make it your goal to save that amount, so the next time you need a brake job on your car, or the dryer dies you have it covered.
No, we don’t mean physical fitness - though that’s important, too! Our Financial Independence Training, or FIT program helps Members better manage their money and forge a path to financial stability. This is a free service that can help you choose a reachable financial target, develop proactive financial habits, and create a debt-reduction plan. Our FIT coaches are highly trained and can help you get back on your feet and reach your financial goals. Make an appointment to speak with a certified FIT coach today.
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