Covid-19 hit us all in the year 2020, and it hit us hard. All of us have been affected directly or indirectly. Some of us have had the privilege to work from home. Unfortunately, many jobs were lost during the pandemic. Some companies were forced to cut on expenditure leading to a reduction of salaries for employees. It is a tough time for us, especially for families with school-going children who do not understand what is happening. As the lockdown started opening up, some of us went back to working from the office, others managed to get new jobs, but many still are jobless. Countries like the United Kingdom and the United States are still under lockdown, and we pray that things will be better this year. One thing that the pandemic has taught us is how to manage our finances. I will guide us through some of the ways we can manage our finances in 2021 and beyond.
This is the most important thing to consider when getting started with managing our finances. I can give the quick financial tips that we need, but without a well-defined financial goal, it will not matter because we will not know the tips that will apply to us and those that will lead us in the wrong direction.
It is essential to have a budget. If we have any source of income, let us try and survive with that. Budgeting is the first and foremost understanding of the money we have coming in and going out every month. The first thing to do, in my opinion, is to arrange for any direct debits and regular payments to be made once the salary hits the account. This will allow us to see how much money we are left with for other entertainment or grooming expenditures. Also, set aside some extra cash to the budget to accommodate emergencies that may arise during the month.
No matter how much or how little we have, it is never easy managing our finances. Thanks to the developing technology, we have applications for everything, and there are many budget-making applications available on the internet when it comes to managing our money.
After making the budget, we should keep the money for essentials in a separate bank account. It may look like a smaller amount, but it will make us more aware of our spending.
We all need a good investment. Invest in products that will help in the long run. We might have lost out on jobs, or our salaries might not be enough, but we can look for other income sources. Start small by maybe selling food items because we all need food to survive. Sell off things that aren’t of importance. A little bit of spending will not hurt us once in a while.
2020 has given us a life lesson, and that is to expect the unexpected. Saving up for an emergency is essential, especially in this pandemic. It is one of the best ways to protect ourselves from setbacks and unsureness. Try and save up every month so that we have the savings that will save us when we need the money.
Some of us spend on so many unnecessary things like gym equipment that we will not use in the next six months, eating out daily, subscribing to different channels, and many more. I am not saying that we should stop some of these things completely, but it’s necessary to reduce them. For instance, taking the example of eating habits, it is not abnormal for someone to dine out frequently, especially if they live alone. Well, eating budget during the pandemic can be a problem as the food and hospitality industry might have taken the hardest hit among others. Yet, there are ways, such as ordering food online to have it delivered to your home, which may be cheaper than eating out. Similarly, you could try not overly depend on the credit card; try as much as possible to make cash payments.
While some of these tips may be oblivious, some of us fail to adhere to them. We have all been affected by the pandemic, and we are all trying to survive in one way or another. Sometimes we get carried away in these trying times, and the only way to keep up is by sacrificing luxury for necessity. These tips will help our families now and in the future.