With the pandemic raging, many people have found themselves losing their secondary income or even completely out of work. Fortunately, we’re able to see the light at the end of the tunnel, as the economy all around the world has begun to recover. This may take a few more years, however, so budgeting has become a number one priority.
Fortunately, you can save money and improve your finances even during uncertain times by remembering these five budget-saving tips.
Odds are that you can cut down on at least one regular monthly expense if you take a hard look at your expense records. Starbucks coffee is one great example, but a lot of people also spend tons of cash ordering food online from restaurants for delivery.
In general, it’s much cheaper to make food at home. Many people just prefer to order food online because it’s much more convenient, especially if they live otherwise busy lives. The point isn’t necessarily to cut down on ordering in. It’s to cut down on things you don’t need to be spending money on, particularly if you want to spend money elsewhere.
Next, luxury entertainment should be out of the question. Because of the quarantine, quite a few people have begun to spend their time (and money) on video games, digital trading platforms, or even at prestigious online casinos.
While we’re in some form all stuck with our computers as our best friends, we should refrain from partaking in addictive activities that may cause us to spend our monthly savings on them.
Another example is gas. Do you really need to drive everywhere? If you don’t, you could stop wasting money on gas by walking more often.
Alternatively, hold off on spending money on Black Friday or other big “shopping holidays” that are little more than schemes designed to get you to spend, spend, spend.
By cutting down on things you don’t really need, you’ll save money in the long run or be able to redistribute that money toward other purposes. This is the best way to save money by far if you can’t increase your income in the short-term future (such as by asking for a raise, etc.).
For starters, make sure that you regularly track your spending. Whether you use physical spreadsheets or basic online software, you should track your income and expenses rigorously. Why?
Simply put, it’s easy for us to spend way more money than we anticipate on small everyday luxuries or expenses. For example, a cup of Starbucks coffee usually costs around five dollars no matter what you want to put in it. How many times do you stop at Starbucks every week?
By tracking your expenses, especially on websites like Amazon, you can figure out where you are spending most of your money and determine places where you can cut unnecessary expenses. This leads us to our next big budget-saving tip.
Many people enter financially uncertain times in the first place because they have multiple debt sources accruing interest and demand monthly payments. If you aren’t careful, debt can quickly pile up and ruin your financial livelihood. Even a few different credit card bills can sap away much more of your income than you might think.
Because of this, one good money-saving strategy actually involves spending money… on your debts, that is. For the best results, prioritize paying down the smallest credit cards or loans that you have in full as quickly as you can.
Why do this? Every credit card or loan that you have accrues interest over time, meaning you pay more for the credit card balance or loan the longer you take to pay off the balance. If you pay off a loan's balance entirely, it costs more in the short term, but saves you money in the long term.
This is an excellent budget-saving strategy in general, not just for securing a little side income so you can enjoy your favorite hobbies.
You can further increase your likelihood of saving enough money for your favorite hobbies or for side projects if you make saving strategies automatic.
Thankfully, lots of debit cards or bank accounts have automated controls you can use to divert some of your paycheck at the end of every week or month into a dedicated savings account. A lot of people have difficulty remembering to put some money away in a savings account, especially if they want to save for a big-ticket item or a luxury like a vacation.
By using automated saving tools, you don't have to think about it whatsoever. Instead, your bank can take out a certain percentage of each check and safely tuck that money away into your savings account. The next time you look at your savings account balance, you might be surprised at how much you have managed to save!
Aside from directly saving money, you can also boost your budget by starting a side hustle. Side hustles are anything from second jobs to monetizing your favorite hobbies or niche interests. It can be running a personal store on a platform like Etsy, doing a little freelance work on the side, or anything else.
The point is this: a side hustle would theoretically allow you to bolster your budget by adding income directly to your bank account at the end of every month. You can then use this extra income to save directly for an expensive item or you can use the extra income for your favorite hobby.
Side hustles don’t work for everyone, however. You have to have the time and energy to do a good enough job at your side hustle that you can actually gain securities and income from it. Still, this can be a great way to increase your overall budget if you have already looked at your current expenses and don’t see anywhere you can make cuts.
As you can see, there are lots of ways you can improve your finances during uncertain times, especially if you just need to save a little money over the short term (as a lot of families did during the coronavirus pandemic).
We’d recommend trying each of the tips above. Combined, they have the potential to dramatically increase your budgetary health and ensure that you’re never fully living paycheck to paycheck.
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