Life After Lockdown: Getting Your Finances In Order
The COVID-19 crisis has strained the financial system to its limits, plunging the world into a recession so deep it has not been seen since the Great Depression. With record-high unemployment and small business bankruptcies on the rise, plenty of people are taking a hard look at their own finances and wondering what happens next.
As the world begins to open up and formerly homebound people cautiously leave their houses, a new normal is already developing. And with a few strategic changes, that new normal could be better and more financially stable than the one the virus left behind. Here are some money-saving tips you can use to survive life after lockdown.
Rethinking The Two Car Family
In the wake of the coronavirus pandemic and the resulting lockdown, millions of cubicle dwellers become at-home workers overnight. And now that the world is opening up, many businesses are rethinking their strategies and preparing for a post-pandemic world in which telecommuting is the norm and not the exception.
From major banks like Barclay’s to insurance companies like Nationwide to tech leaders like Facebook and Twitter, businesses everywhere are exploring a permanent at-home workforce. Some have already announced plans to let employees work from home on a permanent basis, while others are experimenting with hybrid models that combine in-office work with flexible telecommuting rules.
Given the changing labor landscape, there is a good chance you or your spouse will be able to work from home on a permanent or semi-permanent basis. What that means to your finances is that ditching that second car payment is now a real possibility. It may be time to rethink the old two car family model, and that could mean enormous cost savings for households from coast to coast.
Use Your Online Shopping Prowess
Chances are you have been doing a lot of online shopping over the past couple of months. With nonessential businesses shuttered and the remaining big box stores mobbed with shoppers, online outlets became an essential part of our health and safety.
Now that you know how to shop safely online, why not take what you have learned and apply it to a post-COVID world? Even as stores open up and restrictions are relaxed, shopping online can be a smart and frugal thing to do.
There are plenty of ways to save money while shopping online, from establishing ongoing subscriptions at places like Amazon and Target to trading in your credit card rewards for discounts and gift cards.
Another online shopping lesson from the pandemic is the value of stocking up, another money-saving strategy that can persist long after a vaccine is found. From scooping up deals on toilet paper to stocking the pantry with cut-rate cereal, there are plenty of ways to save real money when shopping online.
Reset Your Insurance Rate
When you signed up for your latest car insurance policy, the agent probably asked how many miles you drive, and you responded honestly, detailing your daily commute and checking your vehicle’s odometer. But that was before the virus and the lockdown, long before you traded your corner cubicle for a home office.
Chances are you are driving less, maybe much less, than you did when you took out your automobile insurance policy. Now is the time to reset your rate, so call your agent and ask them to prepare a new quote based on your new driving realities.
Build Out a Second (or Third) Stream of Income
In the blink of an eye, the country went from record low unemployment and millions of unfilled positions to unemployment rates not seen since the depths of the Great Depression. That was a hard lesson for workers everywhere, as millions of workers wondered how they would make ends meet.
The expanded unemployment compensation passed in the wake of the coronavirus crisis helped fill the gap, but the economic reality of employment uncertainty still remains. Given the new realities, it is more important than ever to diversify your streams of income.
Maybe you took on a side hustle following your job loss, delivering groceries and essential supplies to your homebound neighbors. Maybe you went to work in an Amazon warehouse, packing boxes for all those online shoppers. Instead of viewing those side hustles as a temporary solution, look for ways to make them a permanent part of your financial life.
Developing a second (or third) stream of income could be a vital part of leading a more financially secure life. If you do not have time for a second job, consider a side hustle you can do in your spare time, or offer your services to the neighbors you now know on a first-name basis.
You may even be able to develop income streams that do not require any labor at all. If you have money sitting in a low-yielding savings account, moving some of that cash to a higher-yielding bond fund or investing in dividend-paying stocks could increase your passive income and make it easier to make ends meet.
The coronavirus pandemic has changed everything, from the way people work and shop to how they view one another. The financial world has also changed enormously in the wake of the COVID-19 crisis, but the challenges have also created great opportunities. The strategies listed above can help you deal with life after lockdown, so you can enjoy better finances and greater security in this brave new world.
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