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Find ways to save money during the pandemic

With stock market crashes, the coronavirus pandemic, and economic recession around the corner, nearly everyone is thinking about ways to save money. As we adjust to a “new normal,” it’s important that we figure out ways to save money that still apply while the pandemic is in full force.

After all, saving a bit of money right now could help you beef up your emergency fund, take care of important obligations, and save for a brighter future. But what are some tips that still apply in our strange new world?

Keep reading to see if our money-saving ideas can help you feel just a little bit richer.

1. Get real (and kind)

As with any kind of financial exercise, it’s important to be totally honest with yourself about your current financial fitness. After all, if you avoid or ignore the reality of your finances because it’s nerve-wracking to think about, it can lead you to lose money down the line.

To plan ways to save money, it’s important that you first get honest about your income changes, spending, savings, investments, debts, and other financial obligations.

As you go through this process, recognize that you’re not alone if it provokes feelings of shame about money. In reality, personal finance-related anxiety is so common that a Financial Therapy Association has sprouted up to help budgeting novices overcome the discomfort related to money. 

To help yourself get real about your financial situation, try to also treat yourself with compassion. Try to resist the urge to hold yourself to a perfectionistic standard when you’re testing out new ways to save money. If one day you splurge on a $6.00 coffee because of a sudden caffeine craving, that doesn’t mean that all of your progress has been lost.

After all, trying new ways to save money is really about improving your long-term financial fitness, not denying yourself all of life’s pleasures. 

2. Adjust your budget for the new normal

After you’ve figured out your basic money habits, it’s a good time to make a budget. Creating a realistic budget that takes into account our new normal is one of the most important ways to save money.

Nearly everyone’s financial situation has changed since the coronavirus pandemic started, so make sure you take into account any changes. Has your employment situation changed? How much will adding masks, cleaning supplies, hand sanitizer, and delivery fees change your monthly grocery budget? Are you saving money on transportation?

After you’ve taken into account these changes, see if you can still roughly apply the 50/30/20 spending rule to help you organize your spending. If you follow the 50/30/30 spending rule, about half of your budget should be reserved for essentials (food, masks, insurance, shelter, and healthcare), 30% to flexible spending (hobbies, fun activities, and non-essential treats), and about 20% to your financial goals (investing, saving, and paying debts).

You may also consider combining this strategy with the Pay Yourself First (PYF) principle. Folks who follow PYF invest the last 20% of their budget as soon as they get paid. This simply forces you to prioritize your financial goals differently. 

3. Trim back on spending 

Especially during the pandemic, it’s important to eliminate unnecessary spending. You can begin by reviewing how you typically spend more than necessary on eating out, groceries, entertainment, and other products.

See if some of these ways to save money might work for you:  

  • Groceries: Being locked up might be a good time to reset some of your eating habits and grocery budget. Try cutting back on junk food, expensive pre-made meals, and exotic luxury foods. With more free time, you can even start clipping coupons. 
  • Take-out: If you have more time on your hands, you can probably cut back on take-out and instead cook at home. 
  • Subscriptions: Review your subscriptions and get honest about what you really use and what really brings you joy. You might decide to keep your Headspace subscription, but perhaps you find that Netflix binges and Disney+ marathons aren’t really improving your mental health.
  • Try a money-saving challenge: If you have more time on your hands, you can spend some time to find a money-saving challenge that might work for you. For example, you can test the 52-week money challenge and adjust it for your current situation.

4. Preserve your savings

If one of the ways to save money that works for you is cutting back on subscriptions, eating out, and normal transportation costs, save your savings.

Especially during a stressful time, it might be tempting to squander your savings on online shopping or other unnecessary spending, but try to put that extra money towards your emergency fund, savings account, or conservative investments.

Although it might not feel like it right now, those savings will multiply and make you happier in the long run than the unicorn onesie that caught your eye from Wish.

While these ways to save money might not resolve all of your financial woes related to the pandemic, they might be able to help you painlessly save more. For more ideas on how to save money, review the rest of the FlexAcademy library!

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